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21-1092
21-1092ORDINANCE NO AN ORDINANCE APPROVING AN ECONOMIC DEVELOPMENT AGREEMENT UNDER CHAPTER 380 OF THE LOCAL GOVERNMENT CODE TO PROMOTE ECONOMIC DEVELOPMENT AND TO STIMULATE BUSINESS ACTIVITY AND ECONOMIC GROWTH OF THE CITY OF DENTON, BETWEEN THE CITY OF DENTON AND DYNAGRID CONSTRUCTION GROUP, LLC, REGARDING THE EXPANSION OF OPERATIONS AND INCREASE IN THE NUMBER OF HIGH WAGE OR KNOWLEDGE- BASED JOBS IN THE CITY OF DENTON; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, Dynagrid Construction Group, LLC (“Dynagrid Construction Group”), is a Texas limited liability company; and WHEREAS, Dynagrid Construction Group has made a request, on or about April 6, 202 1, of the City of Denton (“City”) to establish economic development incentives under Chapter 380 of the Texas Local Government for a relocation and expansion and job-based grant to expand their business and increase the number of high wage or knowledge-based jobs in the city to stimulate economic development and growth (“Grant Application”); and WHEREAS, the Grant Application was subsequently recommended by the Economic Development Partnership Board as compliant with the City of Denton’s Tax Abatement and Incentive Policy (Resolution No. 20-504, as adopted, on March 17, 2020) and the City Council hereby also finds compliance therewith; and WHEREAS, City and Dynagrid Construction Group have negotiated a Chapter 380 Economic Development Agreement to reflect the terms of the incentive, a copy of which is attached hereto and made a part hereof by reference (the “Agreement”); and WHEREAS, the City Council of the City of Denton hereby finds that the contemplated use and for the proposed purposes and considerations provided for in the Agreement, and the other terms and conditions of the Agreement, will promote economic development, increase employment, and stimulate business and commercial activity within the City of Denton for the benefit of the public and therefore meets the requirements under Chapter 380 of the Texas Local Government Code; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON, TEXAS 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 attached hereto 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. Page 1 SECTION 3. This Ordinance shall become effective immediately upon its passage and approval. The mption to approve this Ordinance was made by Bq, IRa $ eLk ,_ and se,onded by {\ \\son Mag O ? ct , the Ordinance was passed and amd by the following vote al - 1.2] : Nay Abstain Absent Gerard Hudspeth, Mayor: Vicki Byrd, District 1 : Brian Beck. District 2:„/ ,/ & Jesse L. Davis, District 3 : Alison Maguire, District 4: Deb Armintor, At Large Place 5 : Paul Meltzer, At Large Place 6:Z PASSED AND APPROVED this the C,tO day of 202 1 H, MAYOR ATTEST: ROSA RIOS, CITY SECRETARY At1111111f E IF %Z.Z APPROVED AS TO LEGAL FORM: CATHERINE CLIFTON, INTERIM CITY ATTORNEY Digitally signed by Mack #'„Z Gk=J:W=d„''„;=':„:';BY: 1 -VJ VV Page 2 DocuSign Envelope ID: 28072256-D68B4CD7-8BDF-EDF9FB180F76 THE STATE OF TEXAS § COUNTY OF DENTON § ECONOMIC DEVELOPMENT AGREEMENT WITH DYNAGRID CONSTRUCTION GROUP, LLC This Economic Development Agreement (this “Agreement”) is made and entered into as of the Effective Date as defined herein by DYNAGRID CONSTRUCTION GROUP, LLC (“Grantee”), an Texas limited liability company, located at 725 E. Jones St., Lewisville, Texas, 75057, and the CITY OF DENTON (“City”), a Texas home-rule municipal corporation, located at 215 E. McKinney St., Denton, Texas, for the purposes and considerations stated below. Grantee and City may be individually referred to as a “Party” and collectively as the “Parties.” WHEREAS, this Agreement is authorized pursuant to Article III, Section 52-a of the Texas Constitution and 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 intends to relocate and expand their business and increase the number of high wage or knowledge-based jobs in the City of Denton; and WHEREAS, on or about April 6, 202 1, Grantee submitted an application to the City to request economic development incentives pursuant to the Act (the “Grant Application” as shown in Exhibit B attached hereto and incorporated herein for all purposes); and WHEREAS, the Grant Application was reviewed by the Economic Development Partnership Board (the “EDP Board”) in accordance with the City of Denton Tax Abatement and Incentive Policy on May 12, 2021, and the EDP Board found the Grant Application meets the qualifications for financial incentives and recommended approval of the proposed incentives unanimously; and WHEREAS, the City Council of the City of Denton (“City Council”) desires to provide an incentive in the form of a grant to the Grantee to relocate and expand the business and jobs in the City of Denton and hereby finds that the contemplated use of funds to be provided will promote economic development, increase employment, and stimulate business and commercial activity within the City of Denton for the benefit of the public and therefore meets the requirements under Chapter 380 of the Texas Local Government Code; and WHEREAS, the City Council has determined that a grant of funds in accordance with the terms of this Agreement will directly establish a public purpose and that all transactions involving the use of public funds and resources in the establishment and administration of this Agreement contain controls likely to ensure that the public purpose is accomplished; and NOW, THEREFORE, the City and Grantee for and in consideration of the promises contained herein do hereby contract, covenant, and agree as follows: 1 DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 1. DEFINITIONS “Annual Salary” means wages, paid bonuses, commissions, incentive pay or any other amounts that are recorded in Box 1 of an employee’s W-2 form as reported to the Internal Revenue Service. “Base Jobs” means the One Hundred and Ninety-One (191) employees of Grantee at the Lewisville, Texas facility included in the Grant Application. “Eligible Job” means a Job which is paid an Annual Salary of at least Sixty-Five Thousand Dollars ($65,000) per year; provided that for any employee that is employed in an Eligible Job during a partial year, the Annual Salary requirement shall be pro rated for the number of days during such year in which such employee was employed by the Grantee. “Eligible Reimbursable Expenses” means expenses made by the Grantee during the term of this Agreement as part of its business expansion, including relocation costs, utilities (including internet and cloud storage), purchase of furniture, fixtures, and equipment (including computers, office equipment, and other materials necessary to operate the business), construction and improvement costs, of which the Grantee can provide documentation of making such expense during the term of this Agreement. “Established Resident” means an individual hired by Grantee after the Effective Date of this Agreement with a primary dwelling place inside the corporate limits of the City of Denton at the time an employment application was submitted and/or the date the employee was offered the position with Grantee. This is to be included in the employment roster attachment to the Certificate of Compliance. “Expansion Grant” means a grant in an amount not-to-exceed $40,000 for Eligible Reimbursable Expenses. “Job” means a permanent, full-time employee (not independent contractor) of the Grantee working in the City of Denton, not including any of the Base Jobs, that maintains full-time paid employment and is issued an Internal Revenue Service W-2 form by Grantee. “Job Grant” means a grant made once per each new Eligible Job added by the Grantee between January 1 of the Program Effective Year and December 3 1 st of the year that the five (5)-year term ends with payments occurring pursuant to Article IV and V of this Agreement. “New Resident” means an individual hired by Grantee after the Effective Date of this Agreement with a primary dwelling place outside the corporate limits of the City of Denton at the time an employment application was submitted and/or the date the employee was offered the position with Grantee, but establishes a primary dwelling place inside the corporate limits of the City of Denton after an employment application was submitted and/or the date the employee was offered the position with Grantee. This is to be included in the employment roster attachment to the Certificate of Compliance. 2 DocuSign Envelope ID: 28072256-D68B4CD7-8BDF-EDF9FB180F76 “Program Effective Year" means the first year for which Grantee requests that the grant payment be initiated and City determines that Grantee is eligible to receive a grant. “Residency Bonus” means a grant made to Grantee for each Job added during the “Coverage Period” for which the Grantee can successfully demonstrate the employee is an Established Resident or New Resident during the “Coverage Period,” with payments occurring pursuant to Article IV and V of this Agreement. 11 GRANT CONDITIONS Grantee shall satisfy the following conditions to receive the grant payments from the City provided in Article IV and V, and to avoid termination of this Agreement pursuant to Article VIII : A. Grantee covenants and agrees with the City that the City’s obligations under this Agreement are subject to the fulfillment of the Grantee’s obligations under this Agreement, and Grantee hereby agrees to perform and comply with the terms, conditions, and provisions of this Agreement and in all other instruments and agreements, if any, between Grantee and the City with respect to the financial or other incentives provided herein. B. Grantee is duly authorized and existing under U.S. law and is in good standing under such laws and is registered to do business in the State of Texas. C. In the event of any conflict between the City of Denton Code of Ordinances and federal, state, or other local regulations, and this Agreement, such ordinances and/or regulations shall control. D. In accordance with Chapter 2264 of the Texas Government Code, Grantee covenants and certifies that Grantee shall not knowingly employ any person who is not lawfully admitted for permanent residence to the United States or who is not authorized under law to be employed in that manner in the United States (“Undocumented Worker”). During the term of this Agreement, Grantee shall notify the City of any complaint brought against Grantee alleging that Grantee has knowingly employed Undocumented Workers. In accordance with section 2264.052 of the Texas Government Code, if Grantee is convicted of a violation of 8 U.S.C. section 1324a(f) for employing an Undocumented Worker, all grant payments shall be terminated, and Grantee shall repay the amount of all grants with interest of ten percent (10%) per annum from the date the grant payment(s) was made. Repayment shall be paid within 120 days after the date Grantee receives notice of such conviction from the City. E. For the term of the Grant, Grantee must maintain its corporate headquarters and principal place of business within the corporate limits of the City of Denton. For the avoidance of doubt, nothing herein precludes Grantee from maintaining satellite offices in any location, provided the headquarters and principal place of business remain within the corporate limits of the City of Denton. 3 DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 F. Grantee shall not fail to render for taxation any property located within the City of Denton, nor shall it allow the ad valorem taxes owed to the City on any property owned by the Grantee and located within the City of Denton to become delinquent beyond the last day they can be paid without assessment of penalty, as such date is generally extended to allow for any appeal. G. Grantee shall not allow any other municipal fees, levies, assessments, bills, or fines to become delinquent. H. Grantee shall not discriminate in employment and contracting based on race, sex, sexual orientation, gender identity, age, disability, creed, color, genetics, or national origin, and shall not violate any applicable anti-discrimination laws in connection with Grantee’s business. I. Grantee agrees to use good faith efforts to purchase and select goods, services, and contractors from businesses located in the City of Denton whenever such goods, services, and contractors are comparable in availability, quality, and price. In the selection of contractors, suppliers, or other persons proposed for work on this Agreement, Grantee agrees to use its good faith efforts to select and employ historically underutilized businesses for work on this Agreement, whenever such vendors are comparable in availability, quality and price; however, Grantee is not required to use such vendors. Grantee is not required to but may submit information related to any good faith efforts as it relates to the local procurement of goods and services or the use of historically underutilized businesses with its annual Certificate of Compliance. 111 TERMS OF GRANTS A. The City agrees to provide the Grantee a Job Grant in the amount shown in TABLE V-1 for each new Eligible Job, above the Base Jobs, added in the applicable “Coverage Period” as shown in TABLE IV-1. The total amount of the Job Grant shall not exceed One Hundred and Nine Thousand Five Hundred Dollars ($109,500) over the term of this Agreement. B. An additional Residency Bonus will be provided in the amount of $300 for each Job added that is a New Resident in the applicable “Coverage Period” as shown in TABLE IV-1, and $700 for each Job added that is an Established Resident in the applicable “Coverage Period” as shown in TABLE IV-1 if the Grantee provides documentation of such employee’s residency in the City of Denton corporate limits during the applicable “Coverage Period”. The total amount of the Residency Bonus shall not exceed Twenty-Seven Thousand Three Hundred Dollars ($27,300) over the term of this Agreement. C. The calculation of the Job Grant payment amount for any “Coverage Period” as shown in TABLE IV-1 and the schedule of payments shall be made in accordance with Articles IV and V. D. To receive a Job Grant payment for a “Coverage Period,” the Grantee must submit the annual Certificate of Compliance (as shown in Exhibit A attached hereto and incorporated herein for all purposes) in accordance with the dates provided in TABLE IV-1, along with all 4 DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 documentation required to certify compliance with the terms and conditions of this Agreement, including but not limited to, employee W-25, offer letter, and an annual employment roster. E. If at any time during the term of this Agreement Grantee fails to maintain the total number of Eligible Jobs from all previous “Coverage Periods,” the Grantee is ineligible for the Job Grant payment until the Eligible Job numbers exceed the level prior to reduction. Only Eligible Jobs added above the level which existed prior to the reduction will be eligible to receive a Job Grant. For purposes of illustration and clarification, if Grantee receives the Job Grant for two (2) Eligible Jobs in “Agreement Year 1,” and in “Agreement Year 2” one of the Eligible Jobs for which a Job Grant was received in “Agreement Year !” is no longer maintained by Grantee, but another two (2) Eligible Jobs are added, the Grantee is only eligible to receive the Job Grant for one (1) Eligible Job added in “Agreement Year 2.” F. The City will provide an Expansion Grant to Grantee in an amount not to exceed Forty Thousand Dollars ($40,000) upon Grantee’s successful certification and reasonable demonstration of Eligible Reimbursement Expenses to the City. G. The Expansion Grant, or a portion thereof, may be requested by Grantee during the term of this Agreement after Eligible Reimbursement Expenses have been incurred by Grantee. Grantee may only submit a written request for payment of the Expansion Grant, or a portion thereof, once every six (6) months during the term of this Agreement. H. The total amount of the Job Grant, Residency Bonus, and Expansion Grant shall not exceed One Hundred Seventy-Six Thousand Eight Hundred Dollars ($ 176,800). I. The Job Grant, Residency Bonus, and Expansion Grant provided for in this Agreement shall be subject to annual appropriation by the City Council in the annual budget and the City’s obligations under this Agreement shall not constitute a general obligation of the City or indebtedness under the constitution or laws of the State of Texas. IV PAYMENTS OF GRANTS A. The Expansion Grant payment, or a portion thereof, will be paid to Grantee within sixty (60) days of City’s receipt of a written request from Grantee, with appropriate documentation evidencing Eligible Reimbursement Expenses. Grantee may only submit a written request for payment of the Expansion Grant, or a portion thereof, once every six (6) months during the term of this Agreement. B. Grantee must provide the City with a written request to commence the Program Effective Year at least thirty (30) days prior to the last day of the Program Effective Year. The Grantee shall be entitled to the Job Grant and Residency Bonus payments in accordance with the following requirements and schedule: 5 DocuSign Envelope ID: 28072256-D68B4CD7-8BDF-EDF9FB180F76 TABLE IV-1 Certification Due March the followin 'ear March the followin 'ear March the followin 'ear March the followin 'ear March the followin 'ear Coverage Period ’rogram Effective Year)Year 1 Year 2 Year 3 Year 4 Year 5 Payment Within 60 da Within 60 da Within 60 da Within 60 da Within 60 da V CALCULATION OF INSTALLMENT PAYMENTS A. The Job Grant shall be calculated for a “Coverage Period” by multiplying the number of new Eligible Jobs added in the “Coverage Period” by the “Grant Amount per Eligible Job” in Table V- 1. TABLE V-1 Annual Salary Ranges $65,000 to $74,999.99 $75,000 to $89,999.99 $90,000 to $99 >9.99 $ 100,000 or greater Grant Amount Per Eljgjble Job $500 $ 1 ,000 $2,500 $5,000 B. There is no cap on the Job Grant payments for any “Coverage Period” so long as the cumulative Job Grant payments do not exceed One Hundred and Nine Thousand Five Hundred Dollars ($109,500) over the term of this Agreement. C. The Residency Bonus shall be calculated by multiplying the total number of new Jobs established in any “Coverage Period,” which can successfully demonstrate residency in the corporate limits of the City of Denton during the applicable “Coverage Period” by Three Hundred Dollars ($300) for each New Resident and Seven Hundred Dollars ($700) for each Established Resident. D. There is no cap on the Residency Bonus payment for any “Coverage Period” so long as the cumulative Residency Bonus payments do not exceed Twenty-Seven Thousand Three Hundred Dollars ($27,300) over the term of this Agreement. E. Payments shall be issued to DYNAGRID CONSTRUCTION GROUP, LLC, unless an approved assignment occurs under Article XVII herein, and in which case payment shall be directed to the entity assigned rights under this Agreement. OTHER GRANTEE OBLIGATIONS VI A. In order to receive payment of a Job Grant and Residency Bonus for the “Coverage Period,“ Grantee shall submit the Annual Certificate of Compliance form attached hereto as Exhibit A certifying compliance with the obligations set forth in this Agreement not later than 6 DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 March 3 1 of the year following the applicable “Coverage Period” in accordance with TABLE IV- 1 B. Grantee shall submit to the City documentation supporting Grantee’s request and demonstrating proof of Eligible Jobs and residency in accordance with the terms of this Agreement adequate to justify Grantee’s receipt of the Job Grant and Residency Bonus. A failure to provide the Certificate of Compliance and supporting documentation by the “Certification Due” date set forth in TABLE IV- 1, may, in the sole discretion of the City, result in Grantee being ineligible to receive the Job Grant and Residency Bonus for the applicable “Coverage Period.” VII AUDITS AND MONITORING During the term of this Agreement, the City reserves the right to conduct audits of the employment records of the Grantee related to this Agreement if, in the sole opinion of the City, such action is determined to be necessary. Grantee agrees upon reasonable advance request to furnish the City with additional records and information reasonably requested to support that the terms and conditions of this Agreement have been satisfied. Failure to provide such assistance shall be grounds for default, and City may withhold any Job Grant, Residency Bonus, and Expansion Grant payment until such assistance is provided. During the term of this Agreement, the City will keep, or cause to be kept, copies of the Certificates of Compliance and all documentation or employment records provided by the Grantee, payments made to Grantee, and any other calculations, allocations, and payments required by this Agreement. VIII DEFAULT AND TERMINATION If a party fails to perform any of its obligations under this Agreement and such failure is not cured within thirty (30) days after written notice, the failure of the non-performing party to cure within such thirty (30) day period (or to commence and continue diligently to cure such default if the nature of the failure cannot reasonably be cured within 30 days in the exercise of all due diligence) shall constitute a default under this Agreement. A default by Grantee shall entitle the City to all remedies available at law or in equity, including but not limited to, termination of this Agreement, injunctive relieve, specific performance, and suspending or withholding Job Grant, Residency Bonus, and Expansion Grant payments. A default by the City shall entitle Grantee as its sole remedy to seek specific performance of the terms of this Agreement. IX [NDEMNITY IT IS UNDERSTOOD AND AGREED THAT GRANTEE IN PERFORMING ITS OBLIGATIONS HEREUNDER IS ACTING INDEPENDENTLY AND THE CITY ASSUMES NO RESPONSIBILITIES OR LIABILITIES IN CONNECTION THEREWITH TO THIRD PARTIES AND GRANTEE AGREES TO DEFEND, INDEMNIFY, AND HOLD HARMLESS THE CITY FROM AND AGAINST ANY AND ALL DIRECT AND OUT-OF-POCKET DAMAGES INCURRED BY THE CITY RESULTING FROM 7 DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 CLAIMS, SUITS, AND CAUSES OF ACTION OF ANY NATURE WHATSOEVER BROUGHT BY ANY THIRD PARTY ARISING OUT OF GRANTEE’S OBLIGATIONS HEREUNDER. X REPRESENTATIONS AND WARRANTIES BY THE CITY The City represents and warrants that: A. The City is a home rule Texas municipal corporation that has the power to enter into and has taken all actions to date required to authorize this Agreement and to carry out its obligations hereunder; and B. The City knows of no litigation, proceedings, initiative, referendum, investigation, or threat of any of the same contesting the powers of the City or its officials with respect to this Agreement that has not been disclosed in writing to Grantee; and C. The City knows of now law, order, rule, or regulation applicable to the City or to the City’s governing documents that would be contravened by, or conflict with, the execution and delivery of this Agreement; and D. This Agreement constitutes a valid and binding obligation of the City, enforceable according to its terms, except to the extent limited by governmental immunity and bankruptcy, insolvency, and other laws of general application affecting creditors’ rights and by equitable principles, whether considered at law or in equity; The funds granted by the City are derived from sources lawfully available to the City and are not proceeds of bonds or other obligations of the City payable from ad valorem taxes. XI REPRESENTATIONS AND WARRANTIES BY GRANTEE Grantee represents and warrants that: A. Grantee is a Texas limited liability company duly registered and validly existing under the laws of the State of Texas and is, or will prior to the Effective Date of this Agreement, be qualified to do business in the State of Texas; has the legal capacity and the authority to enter into and perform its obligations under this Agreement; and B. The execution and delivery of this Agreement and the performance and observance of its terms, conditions and obligations have been duly and validly authorized by all necessary action on its part to enter into this Agreement; and C. Grantee knows of no litigation proceeding, initiative, referendum, or investigation or threat of any the same contesting the powers of the City, Grantee or any of its principals or officials with respect to this Agreement that has not been disclosed in writing to the City; and 8 DocuSign Envelope ID: 28072256-D68B4CD7-8BDF-EDF9FB180F76 D. Grantee has the necessary legal ability to perform its obligations under this Agreement and has the necessary financial ability, through borrowing or otherwise, to construct improvements on the portions of the property that Grantee may acquire or improve in accordance with this Agreement. This Agreement constitutes a valid and binding obligation of Grantee, enforceable according to its terms, except to the extent limited by bankruptcy, insolvency and other laws of general application affecting creditors' rights and by equitable principles, whether considered at law or in equity. XII RIGHTS OF LENDERS AND INTERESTED PARTIES The City is aware that financing for Grantee may be provided, in whole or in part, from time to time, by one or more third parties, including, without limitation, lenders, major tenants, equity partners and purchasers or developers (individually, an “Interested Party” and collectively, “Interested Parties”). In the event Grantee fails to perform any of its obligations under this Agreement, all notices to which Grantee is entitled under XVIII of this Agreement shall be provided to the Interested Parties at the same time they are provided to Grantee (provided the Interested Parties have previously been identified to the City and provided their notice addresses to the City). If any Interested Party is permitted under the terms of its agreement with Grantee to cure the event of default and/or to assume Grantee's position with respect to this Agreement, the City agrees to recognize such rights of the Interested Party and to otherwise permit the Interested Party to cure the event of default and to assume all of the rights and obligations of Grantee under this Agreement. The City shall, at any time upon reasonable request by Grantee, provide to any Interested Party an estoppel certificate or other document evidencing that this Agreement is in full force and effect and that no event of default by Grantee exists hereunder (or, if appropriate, specifying the nature and duration of any existing event of default). Upon request by any Interested Party, the City will enter into a separate assumption or similar agreement with such Interested Party, consistent with the provisions of Article. XIII COMPLIANCE This Agreement shall be conditioned upon and subject to compliance with applicable federal, state, and City laws, ordinances, rules, and regulations. XIV NO VESTED RIGHTS The Grantee shall be subject to all applicable ordinances of the City, whether now existing or in the future arising. This Agreement shall confer no vested rights, as defined and referenced in Chapter 245 of the Texas Local Government Code, as amended, on the Grantee or property where Grantee conducts business. Grantee agrees and acknowledges that this Agreement is not required by the City for the Owner to complete the project described in the Grant Application. 9 DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 XV ENTIRE AGREEMENT; CHANGES AND AMENDMENTS This Agreement constitutes the entire agreement of the Parties with regard to the subject matter hereof. Except as specifically provided otherwise in this Agreement, any alterations or deletions to the terms of this Agreement shall be by written amendment executed by both Parties to this Agreement. XVI SUCCESSORS AND ASSIGNS This Agreement shall be binding on and inure to the benefit of the Parties, their respective successors, and assigns. Grantee may assign all or part of its rights and/or obligations in or to or under this Agreement upon written notice to the City of such assignment. The City may execute an amendment to this Agreement evidencing the assignment and the City’s execution of said amendment to the Agreement shall not be unreasonably withheld or delayed. If an assignee agrees in writing to be bound by the terms and conditions of this Agreement and executes an amendment to this Agreement stating the same, the assignor shall be released as to the obligations assigned but not as to any obligations or liabilities of the assignor to the City that arose prior to the assignment. XVII NOTICE Any notice and/or statement required or permitted to be delivered shall be deemed delivered five business days after being deposited in the United States mail, certified with return receipt requested, postage prepaid, addressed to the appropriate party at the following addresses, or at such other addresses provided by the Parties in writing. Any such notice and/or statement shall also be deemed delivered when delivered by a nationally recognized delivery company (e.g., FedEx or UPS) with evidence of delivery signed by anyone at the delivery address. If to Grantee: DYNAGRID CONSTRUCTION GROUP, LLC Ann: Charlie Ferrera 725 E. Jones St Lewisville, Texas, 75057 If to the City: City of Denton Ann: City Manager 215 E. McKinney Denton, Texas 76201 Phone: (940) 349-8307 Fax: (940) 349-8596 With a copy to: City of Denton Ann: City Attorney 215 E. McKinney Denton, Texas 76201 Phone: (940) 349-8333 Fax: (940) 382-7923 10 DocuSign Envelope ID: 28072256-D68B4CD7-8BDF-EDF9FB180F76 XVIII . APPLICABLE LAW This Agreement shall be governed by and construed in accordance with the laws and court decisions of the State of Texas. Venue for any action under this Agreement shall be the State’s District Court of Denton County, Texas. This Agreement is performable in Denton County, Texas. XIX BENEFIT OF AGREEMENT This Agreement is executed solely for the benefit of the Parties and their successors and assigns, and nothing in this Agreement is intended to create any rights in favor of or for the benefit of any third party. XX LEGAL CONSTRUCTION/PARTIAL INVALIDITY OF AGREEMENT In case any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision thereof 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, upon written, mutual agreement of both parties and approval of the City Council, 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. XXI TERM This Agreement shall be effective as of the Effective Date. This Agreement will terminate on the earlier to occur of (a) payment of the maximum authorized amount of the Job Grant, Residency Bonus, and Expansion Grant; (b) December 31st of the final year of the 5-year term from the Program Effective Year; (c) December 31, 2030; (d) date of termination for default in accordance with Article VIII. After termination of this Agreement, the City shall not be liable to make any further payments to Grantee except, if applicable, the payment for “Agreement Year 5“ as provided in TABLE IV- 1 for which Grantee is eligible. EXECUTED and effective as of the iSU day of Tone. , 2021 (“Effective Date”), by the City signing by and through its City Manager, duly authorized to execute same by action of the City Council, and by Grantee, acting through its duly authorized officials. 11 DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 CITY OF DENTON. TEXAS W SARA HENSLEY, INTERII ITY MANAGER ATTEST: THIS AGREEMENT HAS BEEN BOTH REVIEWED AND APPROVED as to financial and operational obligations and business terms.Ma ROSA RIOS, CITY SECRETARY Jessica Rogers APPROVED AS TO LEGAL FORM:PR[NTED NAME Beau Signed Dr I M,& pr,A,,r -\7FgD328BF-)2a4E5 CATHER[NE CLIFTON, CITY ATTORNEY Director of Economic Development TITLE INTERIM Economic Development DEPARTMENT \t 111111/ DYNAGRID CONSTRUCTION GROUP, LLC, a Texas limited liability company .„:.PG{;i:'r„. Its. President 12 DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 EXHIBIT A CITY OF DENTON JOBS-BASED INCENTIVE ANNUAL CERTIFICATE OF COMPLIANCE DynaGrid Construction Group, LLC A. Job Creation Information Start of Coverage Period (date te Period (dateEnd of Cove: Total number ons abort "e Total number of Jobs above "Base Jobs” at End of Coverage Period Total number of Jobs added he 4 minus line 3 Total number of Eligible Jobs1 added 1 Eligible Job is a permanent, full-time employee (not independent contractor) of the Grantee working in the City of Denton, not including any of the permanent, full-time jobs of the Grantee established prior to the start of Coverage Period, that results in paid employment for at least 2,080 hours annually per position and is issued an Internal Revenue Service W-2 form by Grantee, and which is paid an Annual Salary of at least sixty-Dye thousand dollars ($65,000) per year. B. Calculation of Job Grant Total Annual Job Grant Payment Multiply the Grant Amount per Job by the Number of lble Jobs AddedEl 5 BonusC. Calculation ofResidenl Total Number of New Jobs with New Resident (Residency Established Currently and New to Denton Residency Bonus per Jobs Added llrrently and Previously in Denton) Residency Bonus >r Jobs Added $300 Total Amount of Residency Bonus (multiply Line Cl by Line C2) + (multiply Line C3 by Line C4) DocuSign Envelope ID: 28072256-D68B4CD7-8BDF-EDF9FB180F76 D. Total PaYment Request Total Amount of Annual Job Grant Ine B9 Total Amount of Residency Bonus ine C5 Total Amount of Paymenmquesa(Add DI and D2 E. Required Attachments Grantee to submit annual employment roster to include titles of positions, Established Resident or New Resident, and associated employment. Grantee should indicate in which Coverage Period the job was added and if the Job has received a Residency Bonus payment. I hereby certify that, to the best of my knowledge and belief, the information provided herein is accurate and in compliance with the terms of the Economic Development Agreement with the City of Denton, Texas. I have provided a copy of all documentation needed to substantiate the number of Eligible Jobs added and to establish the residency requirement for those positions for which I am requesting a Residency Bonus payment. Printed Name and Title of Certifying Officer Signature of Certifying Officer Date Note: This form is due by March 3 1 of each year after the commencement date, and as long as this Agreement is in effect. Attach employee W-2s, offer letter and employee roster as required by Economic Development Agreement. This Certificate of Compliance should be mailed to: City of Denton AHn: Economic Development 215 E. McKinney St. Denton, TX 76201 14 DocuSign Envelope ID: 2807225&D68B4CD7-8BDF.EDF9FB180F76 EXHIBIT B Economic Incentive Application City of Denton, Texas version 07012019 DENTON iNSTRUcrIONS The City of Denton's Economic Development Department will use your responses to this application to prepare an economic impact analysis of your location or expansion project. Please enter the required information in the shaded cells or check boxes. If you have additional notes or information to include, insert rows or use Column K. Please attach any revelant maps, plats, metes and bounds, or renderings Only complete applications will be considered. If you need assistance, call (940) 349-7776. Please email the completed questionnaire to Erica.Sullivan@cityofdenton.com PLEASE COMPLETE PAGES (TABS) 1 - 7 GENERAL INFORMATION Today's date: 7/9/2020 Company contact inforn Name: Dynagrid Construction Group, LLC Address: 725 E Jones Street City, State, ZIP: Lewisville, TX 75057 Website: www.dynagrid.com Person submitting the questionnaire: Name: Donald Clark Title: Division Manager Email: don.dark@dynagrid.com Phone: 469-338-3035 Fax: Person responsible for grant administration: Name: Diane Ferrara Title: Corporate Secretary EmaIl: diane.ferrara@dynagrid.com Phone: 972-829-6026 Fax: Brief description of company's history including current operations: DynaGrid is a niche Civil Contractor that delivers industry leading Civil Construction Services to the Renewable and Conventional UtiIIty Markets. DynaGrid was founded in 2012 and has a current annual Revenue of $88 Million. DynaGrid is currently headquarted in Lewis\NIle, TX and employs 225 individuals. Company ownership: C'] Privately Held [] Publicly Traded Business form: k] Corporation a Joint Venture a Partnership [] Sole Proprietorship Parent company (if applicable)N/A Company's primary 6-digit North American Industry Classification System (NAICS) Code: 238110 and 237130 Is the project a relocation of an existing facility to Denton from another location? [a Yes If yes, give current location: Lewisville, TX [] No PLEASE COMPLETE NEXT TAB: Descrintion DocuSign Envelope ID: 28072256-D68B4CD7-8BDF-EDF9FB180F76 Economic Incentive Application PROJECT DESCRIPTION Please provide a brief description of the project in Denton (activities to be performed, products to be produced, services to be provided). 250 word limit. DynaGrtd provides Industry Leading Civil Construction Solutions for Renewable and Conventional Energy Partners across the United States. DynaGrid plans to move its Corporate Headquarters to Denton from Lewisville. Our entire corporate team will be located in the main building. This team is comprised of our Executive Team, as well as our Accounting, Human Resources, Safety, and Project Management Departments. We will have a shop that maintains our company owned equipment and vehicles, and will be the primary hub for our Fleet. DynaGrid aligns with the City of Denton Economic Development Incentive Policy in the following areas: 1) industry leader in civil construction for renewable and clean energy markets 2) relocation and creation of new high wage, knowledge based jobs (200+ jobs at average wages above $80,000) 3) recession-proof company that experienced growth and expansion during COVID 4) Significant capital investment and relocation of corporate headquarters office 5) Generates significant business travel into Denton with hotel stays and local spending 6) will have on-site solar facilitites for renewable energy generation 7) has numerous suppliers and vendors located in Denton, and is utilizing local business for due diligence on land acquisition DynaGrid’s expansion into Denton meets the following Economic Development Priority Considerations - expanding and diversifying the tax base - increase in jobs above the Denton County Median - increase in jobs paying over $75,000 per year - encouraging high wage and high skill jobs - engaging in sustainable practices and activities DynaGrid plans to add 48 new jobs with wages over $75,000 in the next five years. They have the option to add these jobs at their existing location/facility in Lewisville but would like to make a significant capital investment in Denton and build a new facility Dynagrid provides construction, support, and services for the Renewable and Conventional Energy Sectors. In addition, we plan to utilize Solar Power for a portion of the Corporate Complex that will be constructed on the site. Dynagrid will bring over 191 jobs to the city of Denton, and a significant number of those jobs exceed Denton County's Median Wage. In addition, this entire site will be developed which will utilize numerous resources from within Denton County creating jobs and stimulating the local economy Please provide a justification for the use of public funds for this incentive request (barriers, financial gap, need) List any additional factors to be considered for this project. Please select all that apply Occupies building vacant for at least 2 a rs Project creates k=£=;;iw1 skilled, or high-paying jobs Significant relationship with unIversities Improvements to Downtown Bternational or national headquarters o i=inn;iii;; filled by Denton residentsmm;i © SUSTAINABLE PRACTICES List any company "green" or sustainable initiatives: Plan to utilize Solar Energy for a portion of the property. Will the company be seeking LEED Certification? n Yes ['] No DocuSign Envelope ID: 28072256-D68B4C D7-8BDF-EDF9FB180F76 If yes, please provide level of certifIcation sought: PLEASE COMPLETE NEXT TAB: Employment DocuSign Envelope ID: 28072256-D68&4CD74BDF-EDF9FB180F76 i EMPLOYMENT AND WAGE WORKSHEET Economic Incentive Application Please insert the EXISTING full-time jobs located in Denton with your company [!8eUllmM18mElIB pport Shoo/Mechanics / Personnel 8 9.009,00 Number Existing Jobs Number of existing FULL-TIME jobs: Number of existing PART-TIME jobs: TOTAL jobs: Annual PAYROLL for existing jobs: 189.00 2.00 191.00 $17,000,000.00 Field Management Please insert the type (engineer, manager, team lead, technical, laborer) and number of NEW full-time jobs that wiN be created in Denton.a Year 6 Pr Manager 1 1mEeKscs 1 7 7 5 7 $69,438 $81,128 $76,998 $57.748 $102,000 $33.38 $39.00 $37.02 $27.76 549.04 $0.00 Field Mana ent Totals !ji:gTr-i-iiI: Estimated number of full-tIme jobs at capacity (part-time can be combined); Estimated annual payroll for full-time jobs at capacity: 273.00 $23,090,696.00 average average PLEASE COMPLETE NEXT TAB: Sales Tax DocuSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 Economic Incentive Application SALES TAX This information is used to estimate the fiscal impact. Please provide the current annual taxable sales (if applicable). Please provide the current annual taxable purchases. This data is used to determine the economic impact of the construction period. Please provide the number of construction jobs anticipated. The following are used for the economic impact of out-of-town visitors. Number of out-of-town visitors estimated in the first year. Average number of Hotel room nights in Denton. $0 $3,439,481 100.00 100.00 180.00 PLEASE COMPLETE NEXT TAB: Utility Doc,uSign Envelope ID: 28072256-D68B-4CD7-8BDF-EDF9FB180F76 UTILITY USAGE AND iNFRASTRUCrURE Economic Incentive Application ELECrRiC Estimated ANNUAL usage in kWh Estimated MONTHLY KW demand Estimated Peak KW Capacity factor 111435 9286.25 12100 What types of power equipment will your facility use? Office equipment; shop equipment (e.g. compressor) Please provide the percent of the project's projected utility usage for manufacturing or processing operations (if applicable).0% 0 0 0 NATURAL GAS Estimated ANNUAL usage in mcf Estimated MONTHLY mcf demand Estimated Peak mcf WATER Estimated ANNUAL usage in gpd Estimated MONTHLY gpd demand Estimated Peak gpd 138600 11550 17000 WASTEWATER Estimated ANNUAL usage in gpd Estimated MONTH gpd demand Estimated Peak gpd 30000 does not include property run-off quantities 2500 5000 TRANSPORTATION Estimated number of trucks per day 10 PLEASE COMPLETE NEXT TAB: New Construction DocuSign Envelope ID: 28072256-D68B4CD7-8BDF-EDF9FB180F76 Economic Incentive Application NEW CONSTRUCTION PROJECT INFORMATION Project type: ['] Build to Suit D Speculative Project use: C'] Industrial a Retail/Restaurant a Other (please describe) Project size: Acreage: 14.52 Preferred start date : 4/1/2021 Desired completion date: 4/1/2022 Current property value from Denton Central Appraisal District* (DCAD): * Please attach a copy of the latest property tax statement(s) from DCAD. [] Other (please describe) ['] Office [] Warehouse/Distribution Sq. Feet:40000.00 $1,264,982.00 iNVESTMENT What funds will be invested or leveraged for the project? Category mprovements/ Structures Personal Property Total Project Costs TAX BASE Provide the estimated valuation of the project $3,2@ $1,500,000 $5,000,000Total @t / Structure: Describe any off-site infrastructure requirements. Will require a tap into the mw ana1 of Way Will require a tap into the existing wastewater line PLEASE COMPLETE NEXT TAB: Relocation - Expansion