21-159721-1.597
ORDINANCE 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 SAFRAN
ELECTRICAL COMPONENTS USA, INC., 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, Safran Electrical Components USA, Inc. ("Safran Electrical Components"),
is a Delaware Corporation; and
WHEREAS, Safran Electrical Components has made a request, on or about July 15, 2021,
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 Safran Electrical Components 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 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 Interim City Manager, or her 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 motion to approve this Ordinance was made by �A j , �a ( q tj;° c - and
seconded by -T,e.8 e- ba..i : s , the Ordinance was passed and approved by
the following vote [-1_ - 0 1:
Aye Nay Abstain Absent
Gerard Hudspeth, Mayor: we
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 G:
PASSED AND APPROVED this the y day of e<- 2021.
ATTEST:
ROSA RIOS, CITY SECRETARY
APPROVED AS TO LEGAL FORM:
GERARDTFUDSPETH, MAYOR
CATHERINE CLIFTON, INTERIM CITY ATTORNEY
Digitally signed by Mack
Reinwand
Date: 2021.09.10 09:12:26
BY: _ -05,001
Page 2
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THE STATE OF TEXAS
COUNTY OF DENTON
ECONOMIC DEVELOPMENT AGREEMENT WITH
SAFRAN ELECTRICAL COMPONENTS USA, INC
This Economic Development Agreement (this "Agreement") is made and entered into as
of the Effective Date as defined herein by SAFRAN ELECTRICAL COMPONENTS USA, INC.
("Grantee"), Delaware Corporation, located at 3780 Flightline Drive Santa Rosa, CA 95403, 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 "Parry" 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 July 15, 2021, 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 August 11, 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 fords that the contemplated use of fiends 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:
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I.
DEFINITIONS
"Annual Salary" means wages, paid bonuses, commissions, incentive pay or any other amounts
that are recorded in Box l of an employee's W-2 form as reported to the Internal Revenue Service.
"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 or Grantee's Designated
Representative 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 $50,000 for Eligible Reimbursable
Expenses.
"Grantee's Designated Representative" means Safran Electrical & Power USA, LLC, a Delaware
limited liability company.
"Job" means a pernnanent, 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, 2021 and December 31, 2026 with payments occurring pursuant to Article IV and V of
this Agreement.
"New Resident" means an individual hired by Grantee or Grantee's Designated Representative
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.
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"Residency Bonus" means a grant made to Grantee for each
Period" for which the Grantee can successfully demonstrate
Resident or New Resident during the "Coverage Period," wit
Article N and V of this Agreement.
H.
GRANT CONDITIONS
h
Job added during the "Coverage
the employee is an Established
payments occurring pursuant to
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.
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.
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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.
III.
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 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 One Thousand, Five
Hundred Dollars ($101,500) 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 -Three Thousand Six Hundred and Twenty -Five
Dollars ($23,625) 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
documentation required to certify compliance with the terms and conditions of this Agreement,
including but not limited to, employee W -2s, 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
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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 1" 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
Fifty Thousand Dollars ($50,000) 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-five Thousand One Hundred and Twenty-five Dollars
($175,125).
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. The Grantee shall be entitled to the Job Grant and Residency Bonus payments in
accordance with the following requirements and schedule:
TABLE IV -1
Coverage Period
Certification Due
Payment
Year 1
March 31, 2022
Within 60 days
Year 2
March 31, 2023
Within 60 days
Year 3
March 31, 2024
Within 60 days
Year 4
March 31, 2025
Within 60 days
Year 5
March 31, 2026
Within 60 days
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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.
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 One Thousand, Five Hundred
Dollars ($101,500) 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 -Three Thousand Six
Hundred and Twenty -Five Dollars ($23,625) over the term of this Agreement.
E. Payments shall be issued to SAFRAN ELECTRICAL COMPONENTS USA, INC,
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_
VI.
OTHER GRANTEE OBLIGATIONS
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
March 31 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
3
TABLE V-1
Annual Salary Ranges
Grant Amount Per Eligible Job
$65,000 to $74,999.99
$500
$75,000 to $89,999.99
$1,000
$90,000 to $99,999.99
$2,500
$100,000 or greater
$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 One Thousand, Five Hundred
Dollars ($101,500) 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 -Three Thousand Six
Hundred and Twenty -Five Dollars ($23,625) over the term of this Agreement.
E. Payments shall be issued to SAFRAN ELECTRICAL COMPONENTS USA, INC,
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_
VI.
OTHER GRANTEE OBLIGATIONS
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
March 31 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
3
UocuSign tnvelope IU:(;r-B(;U2D9-A559-481B-92I=1-(;4/UA13[;9BUbt
forth in TABLE N-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 either party shall
entitle the non -defaulting party 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.
IX.
INDEMNITY
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
CLAIMS, SUITS, AND CAUSES OF ACTION OF ANY NATURE WHATSOEVER
BROUGHT BY ANY THIRD PARTY ARISING OUT OF GRANTEE'S NEGLIGENCE IN
THE PERFORMANCE OF ITS OBLIGATIONS HEREUNDER.
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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 no 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 Corporation duly registered and validly existing under the laws of the
State of Delaware 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
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
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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 to complete the project described in the Grant Application.
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
W
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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:
SAFRAN ELECTRICAL COMPONENTS USA, INC
Attn: Jorge Uribe
3790 Russell Newman Blvd.
Denton, Texas 76208
Phone: 940-272-5700
Fax: 940-272-5716
If to the City:
City of Denton
Attn: City Manager
215 E. McKinney
Denton, Texas 76201
Phone. (940) 349-8307
Fax: (940) 349-8596
10
With a copy to:
City of Denton
Attn: City Attorney
215 E. McKinney
Denton, Texas 76201
Phone: (940) 349-8333
Fax: (940) 382-7923
UocuSign Envelope ID: UFB(;02D9-A569-4blB-92E2-[;4/UAL3UUiUbt
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 CONSTRUCTIONIPARTIAL 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 passible
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) March 31, 2027; or (c) 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 1 ` -rn day of 5et� 1�7 , 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: CFBCO2D9-A569-4B1B-92E2-C470ABC9B067
ATTEST:
ROSA RIOS, CITY SECRETARY
APPROVED AS TO LEGAL FORM:
oocuSigned by:
I
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7F9t]3286F�294�...
CATHERINE
CLIFTON, INTERIM
CITY ATTORNEY
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IJ10111110
CITY OF DENTON, TE S
SARA HENSL Y, INTERIM OrY MANAGER
THIS AGREEMENT HAS BEEN
BOTH REVIEWED AND APPROVED
as to financial and operational obligations and business
terms.
DocuSigned by:
E
'dd�'�'s+
97�9EBOFOQB41 E..
NIUNAI U1?h
Jessica Rogers
PRINTED NAME
Director of Economic Development
TITLE
Economic Development
DEPARTMENT
SAFRAN ELECTRICAL COMPONENTS USA,
INC ooeuSigned by:
By• A079D3EBA242F-
Its:
CEO
12
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EXHIBIT A
CITY OF DENTON
JOBS -BASED INCENTIVE
ANNUAL CERTIFICATE OF COMPLIANCE
Safran Electrical Components USA, INC.
A. Job Creation Information
Start of Coverage Period date
1. January 1, 20
End of Coverage Period date
2. December 31, 20
Total number of Jobs above 'Base Jobs" at Start of Coverage Period
3.
Total number of Jobs above 'Base Jobs" at End of Coverage Period
4.
Total number of Jobs added line 4 minus line 3
5.
Total number of Eligible Jobs' added
6.
1 Eligible Job is a permanent, full -tune 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 annuallyperposition and is issued an .Internal Revenue Service W-2 form by Grantee
or Grantee's Designated Representative, and which is paid an Annual Salary of at least sixty-five
thousand dollars ($65, 000) per year.
B. Calculation of Job Grant
Annual Salary Range
Grant
Number of Eligible
Total Annual Job
of Eligible Jobs
Amount Per
Jobs Added in Each
Grant Payment
Previously in Denton)
Job
Annual Salary Range
4. $700
Total Amount of Residency Bonus (multiply Line Cl by Line
5
Insert number of Eligible Jobs
Multiply the Grant Amount
added in each salary range in
per Job by the Number of
Lines 1 through 4.
Eligible Jobs Added
$65,000 to $74,999.99
$500
1.
5.
$75,000 to $89,999.99
$1,000
2.
6.
$90,000 to $99,999.99
$2,500
3.
7.
$100,000 or greater
1 $5,000
1 4.
8.
Total Amount of Annual Job Grant (add Lines B5 through B8)
9.
C. Calculation of Residency Bonus
Total Number of New Jobs with New Resident (Residency
1
Established Currently and New to Denton)
'
Residency Bonus per Jobs Added
2. $300
Total Number of New Jobs with Established Resident (Currently and
3
Previously in Denton)
Residency Bonus per Jobs Added
4. $700
Total Amount of Residency Bonus (multiply Line Cl by Line
5
C2) + (multiply Line C3 by Line C4)
13
UocuSign tnvelope IU: UI-UU02D9-Abb9-4blb-9;4LZ-U4/VAB(;Vt5ObI
D. Total Payment Request
Total Amount of Annual Job Grant Line B9 1.
Total Amount of Residency Bonus Line CS 2.
Total Amount of Payment Requested (Add D1 and D2) 3.
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 31 of each year after the commencement date, and as long as
this Agreement is in effect.
Attach employee W -2s, offer letter and emplovee roster as required by Economic Development
Agreement.
This Certificate of Compliance should be mailed to:
City of Denton
Attn: Economic Development
401 N. Elm St.
Denton, TX 76201
14
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EXHIBIT B
GRANT APPLICATION
C2 - Restricted
Economic Incentive Application
City of Denton, Texas ciry.
QF
version 07012019 DENTON
INSTRUCTIONS
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.5ullivan@cityofdenton.com
PLEASE COMPLETE PAGES (TABS) 1- 7
Today's date: 7/9/2021
Company contact inform
Name: Safran Electrical Components USA Inc.
Address: 3780 Flightline Dr.
City, State, ZIP: Santa Rosa, CA.
Website: www-safran-electrical-power.com
Person submitting the questionnaire:
Name: Carl Johnson
Phone: 940-272-5571.
Title: Director of Contracts
Fax: 940-272-5716
Email: carl.johnson@safrangroup.com
Person responsible for grant administration:
Name: Carl Johnson
Phone: 940-272-5571
Title: Director of Contracts
Fax: 940-272-5716
Email: carl.johnson@safrangroup.com
Brief description of company's history including current
A leader in its field, with over 60 years' experience, Safran Electrical Components, a subsidiary
of Safran Electrical & Power, specialises in the design and manufacture of electrical interconnect
Company ownership: 0 Privately Held U Publicly Traded
Business form: [� Corporation n Joint Venture [] Partnership C] Sole Proprietorship
Parent company (if applicable): Zodiac US Corp.
Company's primary 6 -digit North American industry
Classification System (NAICS) Code: 336413
Is the project a relocation of an existing facility to Denton from another location? 2 Yes ❑ No
If yes, give current location: Santa Rosa, California
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C2 - Restricted
Economic Incentive Application
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.
Safran Electrical Components (SEC) is considering re -locating it's Santa Rosa, California facility to Denton, Texas. SEC is hopeful to co -locate with
its Safran company affiliate, currently located in Denton, Texas (Safran Electrical & Power USA, I.I.C. located at 3790 Russell Newman Blvd. Safran
Electrical Components would transfer approximately 157 employees work from Santa Rosa, California to Denton, Texas. SEC is a manufacturing
company whom specializes in the aerospace businsss. SEC produces products for aircraft such as large numbers of backshells, conduits, sleeves,
and accessories for cable protection and routingto both aircraft manufacturers, and their suppliers. The company also produces landing gear
electrical dress kits for the entire range of Airbus commercial aircraft and for the Boeing 737 and 787.
The company specialises in the following areas:
*Electrical interconnect components: •Backshells and fittings
*Conduits and sleeves
•Fluid conveyance *Convoluted PTFE hose and hose assemblies
Wight refuelling hoses
-Rigid tubes and special fittings
*Engine build-up kits
I• Power contacts -Lamella contact band
-Specialised connectors
•Build -to -spec harnesses: *Landing gear dress kits
Please provide a justification for the use of public funds forthis incentive request (barriers, financial gap, need).
Like most of the aerospace industry, Safran and it subsidiary, Safan Electrical & Power (SEP) has suffered tremendous economic distress through
the pandemic and the resulting effects on the airline industry. As a result, SEP is considering consolidating more of its work into one facility. Our
strong preference is to locate in Denton, however, without adequate assistance, our headquarters will request us to consider other locations.
Incentives help cement our desire to expand in Denton and create new jobs.
List any additional factors to be considered for this project. Please select all that apply.
X
Occupies building vacant for at least 2
ears
X
Project creates knowledge based, high
X
skilled, or high -paying jobs
X
Significant relationship with
universities
Improvements to Downtown
X
International or national headquarters
25% of local contractors utilized or new jobs filled
X
by Denton residents
Targeted industry sector
Community support and involvement
List any company "green" or sustainable initiatives: Safran Company is pursuing green aircraft initiaves.
This green iniative is aimed at lowering the carbon
footprint currently in existing aircraft
Will the company be seeking LEED Certification? LJYes 1-1JNo
If yes, please provide level of certification sought:
)ocuSign Envelope 10: CFBCO209-A569.489 13-92E2-C470ABC96067
C2 - Restricted
Economic Incentive Application
Please insert the EXISTING full-time jobs located in Denton with your companv.
Existing job Type/Category
Average
Number of Fulk Annual
Time Positions Wage
Position
Average
Hourly
Per Wage Per
Position
Year 3
14
Year 4
14
Year 5
14
Year 6
14
Year 7
14
Year 8
14
Year 9
14
Year r
14
Total Nbr.
140
Annual
Salary
$47,543
Hourly
Wage J'
$22.86
Assembler
44
0.4
44
44
44
44
Number of existing FULL-TIME jobs: N/A
Number of existing PART-TIME jobs: N/A
TOTALjobs: N/A
Annual PAYROLL for existing jobs: N/A
Please insert the tvpe (engineer, manager, team lead, technical, laborer) and number of NEW full-time lobs that will be created in Denton.
PWI New Jobs Created
Job Type/Description
Lead
Yearl
14
Year2
14
Year 3
14
Year 4
14
Year 5
14
Year 6
14
Year 7
14
Year 8
14
Year 9
14
Year r
14
Total Nbr.
140
Annual
Salary
$47,543
Hourly
Wage J'
$22.86
Assembler
44
0.4
44
44
44
44
44
44
44
44
440
$37,164
$17.87
Brazer/Welder
2
2
2
2
2
2
2
2
2
2
20
$44,000
$21.15
Conflex Operator
5
5
5
5
5
5
5
5
5
5
50
$40,000
$19.23
Extrusion Operator
2
2
2
2
2
2
2
2
2
2
20
$35,000
$16.83
Machinist
29
29
29
29
29
29
29
29
29
29
290
$47,543
$22.86
:ean Sigma Engineer
1
1
1
1
1
1
1
1
1
1
10
$56,023
$31.74
Continuous Improvement director
1
1
1
1
1
1
1
1
1
1
10
$134,151
$64.50
Manufacturing Engineering Manager
1
1
1
1
1
1
1
1
1
1
10
$117,676
$56.58
Manufacturing Engineer
4
4
4
4
4
4
4
4
4
4
40
$74,737
$35.93
Planning/Customer Service Specialist
2
2
2
2
2
2
2
2
2
2
20
$58,573
$28.16
Production Planner
2
2
2
2
2
2
2
2
2
2
20
$77,882
$37.44
Master Scheduler
1
1
1
1
1
1
1
1
1
1
10
$82,290
$39.56
Production Control Director
1
1
1
1
1
1
1
1
1
1
10
$134,151
$64.50
Planning and Production Control Manger
1
1
1
1
1
1
1
1
1
1
10
$117,676
$56.58
Supply Chain Manager
1
1
1
1
1
1
1
1
1
1
10
$117,676
$56.58
Quality Inspector
4
4
4
4
4
4
4
4
4
4
40
$52,804
$25.39
Quality Inspector Lead
1
1
1
1
1
1
1
1
1
1
10
$65,601
$31.54
Quality Technician
1
1
1
1
1
1
1
1
1
1
10
$62,084
$29.85
Quality Engineer
3
3
3
3
3
3
3
3
3
3
30
$73,473
$35.32
Quality Director
1
1
1
1
1
1
1
1
1
1
10
$134,151
$64.50
Production Manager
2
2
2
2
2
2
2
2
2
2
20
$117,676
$56.58
Shipping/Receiving Clerk
7
7 1
7
7
7
7
7
7
7
7
70
$35,682
$17.15
DocuSign Envelope ID: CFBCD2D9-A669-4816-92E2-C470ABC98067
C2 - Restricted
Shipping/Receiving Lead
1
1
1
1
1
1
1
1
1
1
10
$47,543
$22.86
Procurement
1
I
1
1
1
1
1
1
1
1
10
$65,601
$31.54
Commodity Buyer
2
2
2
2
2
2
2
2
2
2
20
$89,621
$43.09
Design Engineer
10
10
10
10
10
10
10
10
10
10
100
$74,737
$35.93
Engineering Manager
1
1
1
1
1
1
1
1
1
1
10
$117,676
$56.58
Document Control Clerk
1
t 1
1
1
1
1
1
1
1
1
10
$43,221
$20.78
Controller
1
1
1
1
1
1
1
1
1
1
10
$152,932
$73.53
Aaccounting Manager
1
1
1
1
1
1
1
1
1
1
10
$117,676
$56.58
GR Generalist
1
1
1
1
1
1
1
1
1
1
10
$69,537
$33.43
HR Manager
1
1
1
1
1
1
1
1
1
1
10
$117,676
$56.58
IT Help desk
1
1
1
1
1
1
1
1
1
1
10
$65,601
$31.54
Systems Administrator
1
1
1
1
1
1
1
1
1
1
10
$73,473
$35.32
Program Manager
1
1
1
1
1
1
1
1
1
1
10
$117,676
$56.58
Program Director
1
1
1
1
1
1
1
1
1
1
10
$134,151
$64.50
Sales Director
1
I
1
1
1
1
1
1
1
1
10
$152,932
$73.53
Sales Manager
2
2
2
2
2
2
2
2
2
2
20
$134,151
$64.50
Estimated number of full-time jobs at capacity (part-time can be combined): 157 / year
Estimated annual payroll for full-time jobs at capacity: $ 3,347,760.00
OocuSign Envelope IU: L;F-BQ01D9 A569-4t31L3-91CL-U4(UAb(;Vt3UEi/
Economic Incentive Application
C2 - Restricted
SALES TAX
This information is used to estimate the fiscal impact.
Please provide the current annual taxable sales (if applicable). $27.177M
Please provide the current annual taxable purchases. $3.771M
This data is used to determine the economic impact of the construction period.
Please provide the number of construction jobs anticipated. 29.40
The following are used for the economic impact of out-of-town visitors.
Number of out-of-town visitors estimated in the first year. 20.00
Average number of Hotel room nights in Denton. 270.00
PLEASE COMPLETE NEXT TAB: Utility
uocu5ign tnveiope iu: �rrs�u�ua Haan 4ts ia-a�t�-1 lUHtSC�JCUa!
C2 - Restricted
Economic Incentive Application
ELECTRIC
Estimated ANNUAL usage in kWh 2,338,973.53
Estimated MONTHLY KW demand 194,914.46
Estimated Peak KW 32,204
Capacity factor
What types of power equipment will your facility use?
The facility will use several equipment including: CNC Milling, Tube bending, Injection Mold,
Braiders, Radial driller & miller, Robotic tool, Welder, Laser wire marking, Vertical lifter,
Convoluter extruder, Harding manual chucker, Heath treat oven, Engine lathe, CNC lathe, wire
carousel and Vacuum systems
Please provide the percent of the project's
projected utility usage for manufacturing or
processing operations (if applicable). 80%
NATURAL GAS
WATER
WASTEWATER
TRANSPORTATION
Estimated ANNUAL usage in mcf 98,556.48
Estimated MONTHLY mcf demand 8,213.05
Estimated Peak mcf
Estimated ANNUAL usage in gpd 3,474
Estimated MONTHLY gpd demand 104,220
Estimated Peak gpd 10,145
Estimated ANNUAL usage in gpd Uncertain
Estimated MONTH gpd demand Uncertain
Estimated Peak gpd Uncertain
Estimated number of trucks per day 2
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C2 - restricted
Economic Incentive Application
Project type:
Project use:
Project size:
[] Build to Suit ❑ Speculative
❑ Industrial ❑ Retail/Restaurant
❑ Other (please describe)
Acreage: Sq. Feet:
Preferred start date:
Desired completion date:
❑ Other (please describe)
❑ Office ❑ Warehouse/Distribution
Current property value from Denton Central Appraisal District* (DCAD):
*Please attach a copy of the latest property tax statement(s) from DCAD.
What funds will be invested or leveraged for the project?
Category
Improvements/ Structures
Total :19
$0
Persona[ Property
$0
Engineering and Design
$0
Site Development
$0
Other Improvements
$0
Total Project Costs
$0
Provide the estimated valuation of the project.
low Estimated
Category Valuation
Improvements/ Structures
New
$o
Personal Property
$0
Inventory
$0
Freeport Exemption
$0
Total
$0
Describe any off-site infrastructure requirements.
Water
Wastewater
Streets
Drainage
Other
uocubign tnveiope w; �rrsuuzua-Hgoa-nes is y�r� �4�uHes�acun�
C2 - Restricted
Economic Incentive Application
Project type:
❑ Build to Suit
❑ Speculative
✓ Other (please describe) Modification of Exisiting
Project use:
Q Industrial
❑ Retail/Restaurant
Q Office ❑ Warehouse/Distribution
❑ Other (please describe)
Project size: Acreage: Sq. Feet: 20000.00
Preferred start date: 9/1/2021
Desired completion date: 3/1/2022
Current property value from Denton Central Appraisal District* (DCAD):
*Please attach a copy of the latest property tax statement(s) from DCAD.
What funds will be invested or leveraeed for the Prolect?
Category
Improvements/ Structures
Total
$1,400,000
Personal Property
$300,000
Engineering and Design
$100,000
Site Development
$0
Other Improvements
$0
Total Project Costsl
$1,500,000
Provide the estimated valuation of the project.
$7,541,525.00
Category Current
Improvements/ Structures
Estimated
Valga.fion
$7,541,525
Increase in Estimated
Valuation
$1,400,000
New
Valuation
$8,941,525
Personal Property
$2,010,438
$300,000
$2,310,438
Inventory
$5,423,203
$0
$5,423,203
Freeport Exemption
$0
$0
$0
Totall
$14,975,1661
$1,700,0001
$16,675,166
Describe anv off-site infrastructure requirements.
None Identified
Water
!None Identified
Wastewater
None Identified
Streets
None Identified
Drainage
None Identified
Other