23-1054ORD[NANCENO. 23-1054
AN ORDINANCE OF THE CITY OF DENTON APPROVING AN AGREEMENT BETWEENTHE CITY OF DENTON AND HICKORY & RAIL VENTURES, LLC, REGARDING ANECONOMIC DEVELOPMENT PROGRAM FOR STOKE DENTON, IN THE AMOUNT OF$ 183,963; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City Council of the City of Denton (“City”) deems it is in the public interest
and serves a municipal and public purpose to enter into an agreement with Hickory & Rail Ventures,
LLC (“HRV”), for the purpose of providing for a program to promote economic development through
the joint effort of the City and HRV; and
WHEREAS, to achieve this public purpose, the City created Stoke Denton in 2016 to offera co-working space and access to resources to support entrepreneurship, small business
development, and the development of tech and tech-enabled businesses and workers; and
WHEREAS, Stoke Denton is focused on the recruitment and support of tech and tech-
enabled startups, as well as memberships of businesses in other sectors that are complementary to
a healthy startup community; and
WHEREAS, the City contracted with HRV on November 14, 2017 for the management
and operation of Stoke Denton, and
WHEREAS, HRV has submitted a proposal to the City for the continued support and
management of Stoke Denton and entrepreneurship focused programming beginning July 1, 2023
in the amount of $183,963; and
WHEREAS, Article III, Section 52-a of the Texas Constitution and Chapter 380 of the
Texas Local Government Code authorize the City to enter agreements that promote local economic
development and stimulate business and commercial activity in the City of Denton; and
WHEREAS, the City agrees that HRV is uniquely positioned to continue management of
Stoke Denton and can assist in the City’s strategic goals to support entrepreneurs, startups, and
other small businesses and support the recruitment and growth of tech and tech-enabled businesses
and workers;
WHERAS, City Council deems it in the public interest to authorize such a payment and
program agreement; NOW THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The findings and recitations contained in the preamble of this ordinance are
incorporated herein by reference.
SECTION 2. The City Council finds that the Agreement between the City and Hickory &
Rail Ventures, LLC, attached hereto and made a part hereof by reference (the “Agreement”) serves a
valid municipal and public purpose and is in the public interest.
SECTION 3. The Agreement shall be effective on July 1, 2023 and shall remain in full force
and effect until September 30, 2024.
SECTION 4. The City Manager is hereby authorized to execute the agreement between the
City and Hickory & Rail Ventures, LLC, and the expenditure of funds and transfer of property
pursuant to the Agreement is hereby authorized.
SECTION 5. The City Council hereby expressly delegates the authority to take any actions
that may be required or permitted to be performed by the City under the Agreement to the City
Manager of the City, or the City Manager’s designee.
SECTION 6. This Ordinance shall become effective upon its passage and approval.
The motion to approve this ordinance was made by B, ip_ Be a k and
seconded by By t FIr. I +u ,' , the ordinance was passed and approved bythe following vote U - A :
Aye Nay Abstain Absent
Mayor Gerard Hudspeth:.J
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Vicki Byrd, District 1 :
Brian Beck, District 2:
Paul Meltzer, District 3 :
Joe Holland, District 4:
Brandon Chase McGee, At Large Place 5 :
Chris Watts, At Large Place 6:
PASSED ANDAPPROVPDthi,th, T-–7 1-d,„ ,f JLJ AL 2023
aiX-a–immT@A–f6R
Page 2
ATTEST :
JESUS SALAZAR, INTERIM CITY SECRETARY '$"a?%
APPROVED AS TO LEGAL FORM:
MACK RErNWAND, CITY ATTORNEY
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Page 3
AGREEMENT BETWEEN
THE CITY OF DENTON, TEXASAND HICKORY & RAIL VENTURES, LLC
THIS AGREEMENT is made and entered into as of the ljM day of Jw\R ,
2023 between the City of Denton, Texas, a home rule municipal corporation, hereinafter referredto as the “City”, and Hickory & Rail Ventures, LLC hereinafter referred to as “HRV”, jointly
referred to herein as “parties” and each separately as a “party.”
WHEREAS, the City seeks to support, encourage, and promote the public purpose of
driving new business creation and job growth by fostering a sustainable startup community for
entrepreneurs primarily in early-stage tech and tech-enabled businesses; and
WHEREAS, to achieve this public purpose, the City created in 2016 a co-working space
with access to resources to support entrepreneurship, small business development, and the
development of tech and tech-enabled businesses and workers (“Stoke Denton”); and
WHEREAS, Stoke Denton is focused on the recruitment and support of tech and tech-
enabled startups, as well as memberships of businesses in other sectors that are complementary
to a healthy startup community; and
WHEREAS, the City contracted with HRV on November 14, 2017 for the management
and operation of Stoke Denton, and
WHEREAS, HRV has submitted a proposal to the City for the continued support and
management of Stoke Denton and entrepreneurship focused programming after June 30, 2023;
and
WHEREAS, Article III, Section 52-a of the Texas Constitution and Chapter 380 of theTexas Local Government Code authorize the City to enter agreements that promote local
economic development and stimulate business and commercial activity in the City of Denton;
and
WHEREAS, the City agrees that HRV is uniquely positioned to continue management of
Stoke Denton and can assist in the City’s strategic goals to support entrepreneurs, startups, and
other small businesses and support the recruitment and growth of tech and tech-enabled
businesses and workers;
NOW THEREFORE, in consideration of the covenants, promises, terms, and provisions
contained herein, and for the considerations expressed herein, the City and HRV mutually
AGREE to the following:
I
ARTICLE ISERVICES TO BE PROVIDED BY HRV
HRV represents, acknowledges, warrants, and agrees to perform and provide the
following with regard to its operation, purpose, and services provided for Stoke Denton:
(1) Purpose. HRV agrees to operate Stoke Denton for the purpose of providing support
to entrepreneurs, startups, small businesses, tech and tech-enabled workers, and
remote workers in Denton. The goal of the partnership will be to build businesses,
create jobs, and strengthen the culture and economy of the City of Denton.
(2) Mission. HRV, through Stoke Denton, will support programs, partnerships, events,
and activities that will build a supportive entrepreneurial ecosystem in the City ofDenton.
(3) Independent. HRV operates as a private legal entity separate from the City. This
Agreement does not in any way constitute a joint venture or create a partnership or
principal-agent relationship between the City and HRV. Neither party will assert
control over the operations of the other party.
(4) Organization. HRV is a Texas limited liability company duly organized and validly
existing under the laws of the State of Texas and is qualified to do business in the
State of Texas. HRV has the legal capacity and authority to enter into and perform its
obligations under this Agreement.
(5) Administration. HRV will administer funds, property, services, or other benefits in
accordance with the following procedures and requirements:
a. HRV shall maintain records and accounts that document all funds received by
HRV and all costs incurred by HRV, including any in-kind support received
by HRV.
b. HRV shall provide a report to the City of Denton Economic Development
Partnership Board annually to summarize HRV’s financial information and
benefit to the City as it relates to the performance under this Agreement.
c. A copy of any HRV financial audits and required tax filings shall be provided
to the City upon request.
(6) Staff. HRV shall employ an Executive Director for the entirety of this Agreement.
HRV must also maintain the appropriate staff to carry out the functions of Stoke
Denton in accordance with this Agreement. The Executive Director and any other
staff member of HRV are employees of HRV and shall not be considered an
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employee of the City and shall not be entitled to any payment or benefit from the City
on account of services performed pursuant to this Agreement.
(7) Equipment and Supplies. HRV shall provide any equipment, supplies, or materials
necessary to fulfill the obligations of this Agreement.
(8) Performance. As a condition of the receipt of City funds, HRV hereby agrees to use
and expend all funds pursuant to the agreed upon scope of work as set forth in
Exhibit A. The parties agree that the scope of work is a planning tool, and the City
and HRV reserve the right to revise the scope of work with written consent of both
partres
(9) Reporting. HRV will attend meetings and submit reports on actions and progress
according to the following schedule:
a.
b.
C.
Monthly meetings between Stoke Denton Executive Director and City’s
Director of Economic Development.
Progress on economic development strategic plan work plan items will be
provided to City’s Director of Economic Development or designated staff as
needed, but no less than monthly.
Quarterly reports to be provided by Stoke Denton Executive Director to City’s
Director of Economic Development or designated staff, which must include
the following:
i. Number of active memberships,
ii. Percentage of tech or tech-enabled members,
iii. Member satisfaction (at least annually),
iv. Description of and number of regional startup and tech event
sponsorships,
v. Number of blog posts/content creation regarding Denton’s startup
cornrnunrty,
vi. Social media metrics,
vii. Description of and number of educational events or programs held atStoke Denton,
viii. Description of and number of startup/tech events held at Stoke Denton,
ix. Number of mentor sessions held at Stoke Denton, and
x. Description of activities with partner entities, including education,
nonprofit, and government agencies.
Annual report and presentation to the City’s Economic Development
Partnership Board.
d.
(10) Sponsorship and Acknowledgement. For any programs listed in Exhibit A which
are supported by or partially supported by funding provided by this Agreement, the
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City must be listed as a co-sponsor and acknowledged on any applicable marketing
materials and event materials, both verbally and in print, whenever possible.
ARTICLE II
OBLIGATIONS OF THE CITY OF DENTON
The City will provide the following to HRV:
Funding. The City shall pay One Hundred Eighty Three Thousand Nine Hundred Sixty
Three Dollars ($183,963) to HRV to be utilized for the purposes set forth in Exhibit A.
Payment shall be made no later than July 3 1, 2023 .
ARTICLE IIITERM OF THE AGREEMENT
This Agreement shall be effective on July 1, 2023 and shall remain in full force and
effect until September 30, 2024. The City or HRV shall have the right to terminate the Agreement,
in whole or in part, without cause any time upon sixty (60) calendar days’ prior written notice to
the other party. Upon receipt of a notice of termination by the City, HRV shall promptly cease all
further work pursuant to the Agreement, with such exceptions, if any, specified in the notice oftermination. If this Agreement is terminated by HRV, or terminated for cause by the City
because HRV fails to meet the performance requirements of this Agreement, HRV shall pay the
City a prorated amount of the funds provided by the City pursuant to this Agreement, which
amount shall be prorated to the months remaining in the term of this Agreement.
ARTICLE IV
ASSURANCES BY THE PARTIES
The following is a list of representations, assurances, understanding, policies, procedures,
and agreements regarding the roles, relationship, and functions of the City and HRV in their
working relationship pursuant to this Agreement:
A. Any agreement between HRV and City that is not within the scope of the terms of this
Agreement shall receive the prior approval of the City Council.
B. HRV has no authority to supervise, direct, control, or demand that a City employee
perform any function on behalf of HRV.
C. This Agreement does not grant HRV authority to use the City’s name and trademarks
unless directly specified in this Agreement.
D. Any personnel employed by or volunteering on behalf of HRV shall be deemed
employees or volunteers respectively of HRV and shall not be deemed employees or
volunteers of the City. HRV shall be responsible for the supervision, management, and
control of such HRV employees and volunteers and any payroll, taxation, or other
4
employment obligation, if any, incident to their work. Any personnel employed by or
volunteering on behalf of the City shall be deemed employees or volunteers respectively
of the City and shall not be deemed employees or volunteers of HRV. The City shall be
responsible for the supervision, management, and control of such City employees and
volunteers and any payroll, taxation, or other employment obligation, if any, incident to
their work.
E. HRV shall maintain general liability insurance in the amount of $1,000,000 and in
accordance with City insurance requirements, including adding the City as an additional
insured party.
F. HRV will appoint a representative who will be available to meet with City officials when
requested.
G. HRV AGREES TO INDEMNIFY, HOLD HARMLESS, AND DEFEND THE
CITY, ITS OFFICERS, AGENTS, AND EMPLOYEES FROM AND AGAINSTANY AND ALL CLAIMS OR SUITS FOR INJURIES, DAMAGE, LOSS, ORLIABILITY OF WHATEVER KIND OR CHARACTER, ARISING OUT OF ORIN CONNECTION WITH THE PERFORMANCE BY HRV OR THOSE
SERVICES CONTEMPLATED BY THIS AGREEMENT, INCLUDING ALLSUCH CLAIMS OR CAUSES OF ACTION BASED UPON COMMON,CONSTITUTIONAL, OR STATUTORY LAW, OR BASED, IN WHOLE OR INPART, UPON ALLEGATIONS OF NEGLIGENT OR INTENTIONAL ACTS OFHRV, ITS OFFICERS, EMPLOYEES,
SUBCONTRACTORS, LICENSEES, AND INVITEES.
AGENTS.VOLUNTEERS,
ARTICLE VNOTICE
Any notice or other written instrument required or permitted to be delivered under the
terms of this Agreement shall be deemed to have been delivered, whether actually received or
not, when deposited in the United States mail, postage prepaid, registered or certified, return
receipt requested, or via electronic mail, hand-delivery or facsimile, addressed or sent to HRV or
the City, as the case may be, at the following addresses:
CITY
City of Denton, Texas
Attn: City Manager
215 E. McKinney St.Denton, TX 76201
Sara.Hensley@cityofdenton.com
Hickory & Rail Ventures, LLC
Hickory & Rail Ventures, LLC
Ann: Heather Gregory608 E. HickoryDenton, TX 76205
Heather@stokedenton.com
City of Denton, Texas
AHn: Director of Economic Development401 N. Elm St.
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Denton, TX 76201 ARTICLE VIRIGHT TO AUDIT
HRV agrees to retain all books, records, documents, reports, and written accounting
policies and procedures pertaining to services provided under this Agreement for a period of five
(5) years. The City shall have the right to audit and make copies of the books, fundraising
activities, pledges, donations, gifts, statements, financial records, and computations pertaining to
the Agreement.
ARTICLE VIIADMINISTRATION OF AGREEMENT
HRV shall designate an officer responsible for the administration of the Agreement forHRV. The City Manager, or designee, shall be the City staff member responsible for the
administration of this Agreement on behalf of the City.
ARTICLE VIII
NO ASSIGNMENT
The Agreement is solely between the parties and cannot be assigned to another party
without the express advance written approval of the non-assigning party.
ARTICLE IXMODIFICATION OF AGREEMENT
No modification of this Agreement shall be effective unless it is in writing and signed by
both parties to the Agreement.
ARTICLE XGOVERNING LAW AND VENUE
This Agreement is subject to, governed by, and shall be construed under the laws of the
State of Texas. Venue of any suit or cause of action arising under this Agreement shall be
exclusively in Denton County, Texas.
ARTICLE XISEVERABILITY
If any provision of this Agreement is found or deemed by a court of competent
jurisdiction to be invalid or unenforceable, it shall be considered severable from the remainder ofthis Agreement, and shall not cause the remainder of this Agreement to be invalid or
unenforceable. In such event, the parties shall reform this Agreement to replace such stricken
provision with a valid and enforceable provision which comes as close as possible to expressing
the intention of the parties hereto respecting the stricken provision.
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ARTICLE XIICAPTIONS
The captions of this Agreement are for informational purposes only and shall not in any
way affect the substantive terms or conditions of this Agreement.
ARTICLE XIIICOUNTERPARTS
This Agreement may be executed in multiple counterparts, by one or more signatories,
separately and each of such counterparts shall be deemed an original for all purposes, and all
such signed counterparts shall constitute but one and the same instrument. For purposes of the
parties’ execution of this Agreement, it is expressly agreed that a facsimile or telecopy of a
party’s signature hereto shall be valid, binding and enforceable as the original.
IN WITNESS THEREOF, the City and HRV have executed this Agreement in original
counterparts, the City acting by and through its duly-authorized City Manager, and HRV acting
by and through its duly-authorized undersigned officer.
CITY OF DENTON
[SLESARA
ATTEST:,\\11111111
JESUS SA]CITY SECRETARY
BY a
APPROVED AS TO LEGAL FORM:
MACK REINWAND, CITY ATTORNEY
SEgaBY:
THIS AGREEMENT HAS BEENBOTH REVIEWED AND APPROVED
As to financial and operational
obligations and business terms.
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Signatureata
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Department
HICKORY & RAIL VENTURES, LLC
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EXHIBIT ASCOPE OF WORK
DESCRIPTION I AMOUNT NOTES
RV will produce annual events such as
• FlintConf (annual conference for entrepreneurs)
• Big Ideas (typically have a couple of these throughout the year)
• Startup Crawl (happens throughout Denton to showcase our
businesses)
• Global Entrepreneurship Week (series of events during GEW -
including pitch competition, startup crawl, speakers, etc)
• Produce Denton Pitch Competition for the second year
• Pitch competition - amount includes $10,000 to be distributed
directly to pitch contest winners and an additional $5,000
more than last year to produce the eventEvents$62,306.00
HRV will maintain current programming efforts such as educational
programming and monthly mentor sessions and other educationalprogramming and entrepreneur support
HRV will produce programs, events, and entrepreneurial curriculum that are
targeted at serving current or aspiring technologists as well as women, and
jminority entrepreneursPrograms$59,381.00
HRV will create valuable content such as graphics, blog posts, press releases,
downloadable resources, and videos to help raise awareness around the
entrepreneurship community and the positive impact it has on our economy
and culture.Marketing $23,700.00
HRV will coordinate and convene stakeholders and thought leaders as
represented in the Denton Business Allies and EdTech Alliance, as well as
participate in other partner events and initiatives throughout the region with
DISD, DMSA, Chamber, etc.
HRV will continue to develop and distribute an entrepreneurial ecosystem map
l$38,576.oo lthat includes resources and companies in our local ecosystem.
M1
Ecosystem
Total
HRV will support City staff in the implementation and reporting of progress of the following
strategies and actions identified in the City of Denton Economic Development Strategic Plan
(“Strategic Plan”) by performing the following Work Plan Items:
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Strategic Plan Goal 2B. Foster Growth
2B.1. Champion and Convene
2B.1.2. Establish connections with DFW entrepreneurship organizations such as Dallas 1Million Cups, 1 Million Cups Frisco, Dallas Innovates, Capital Factory, and the Dallas
Entrepreneur Center.
2B.1.3. Assemble a knowledge resource network to support entrepreneurs and companies with
access to financial, legal, policy, and research information needed for their businesses to grow.
2B.1.4. Partner with local and regional partners to design reverse-pitch competitions to engage
major corporations and organizations in the DFW Metroplex with needs for innovation.
2B.1.5. Ensure that targeted resources are available for businesses owned by women and people
of color, who have historically faced barriers to accessing traditional economic development
tools
2B.1.
•
•
Work Plan Items
Attend events hosted by regional startup organizations and stakeholders.
Host and sponsor events that support students and connect them to entrepreneurs,
mentors, and peers.
Seek out opportunities for partnerships, sponsorships, or collaborations with regional
entrepreneurial organizations and stakeholders.
Continue to develop entrepreneurial ecosystem “map” which details companies, mentors,
support organizations, resources, etc. and make the document available to the public.
Write and publish ebook to provide entrepreneurs with tangible tools, templates, and
resources for launching their business.
Expand network of mentors and advisors, specifically increasing participation from
women and minority entrepreneurs and thought leaders.
Initiate the planning of a reverse pitch competition with local and regional partners.
Pursue programming and partnerships that help connect minority entrepreneurs with
peers, mentors, and resources.
•
•
•
•
•
•
2B.2. Access to Capital
2B.2.3. Network with regional entrepreneurship programs so that they become familiar with
Denton and the resources available for businesses looking to grow and expand within the DFW
Metroplex.
2B.2.4. Revise the funding requirements for the EDP Investment Fund to be more inclusive of
innovative startups that might not meet current thresholds for employment and capitalinvestment.
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2B.2. Work Plan Items
Participate in Angel Capital Association and Texas Angel Network calls and syndicate
deal flow when possible.
Attend regional events focused on entrepreneurship, specifically with veteran fundraisers,
angel investors, or VC firms.
Co-host a networking mixer with Denton Angels, Chamber investors, and the Economic
Development Partnership Board.
Engage Denton Angels in Stoke programming and events, specifically pitch events, to
increase connections between investors and entrepreneurs.
•
•
•
•
2B.3. Ecosystem Building
2B.3.1. Partner with the Denton Innovation Group to define a vision for entrepreneurship in
Denton, establish goals, measure progress, and connect with DFW organizations.
2B.3.3. Host a Citywide pitch competition to identify and develop innovative entrepreneurs in
Denton. This not only builds Denton’s creative brand but also provides the City with a way of
identifying top talent in the community.
2B.3.
•
•
Work Plan Items
Coordinate and host Denton Innovation Group meetings on at least a quarterly basis.
Engage groups of thought leaders to increase connections and opportunities between
institutions and anchors (TWU, UNT, NCTC, DISD, Denton Innovation Group,
TechMill, Denton Angels, etc.)
Produce a city-wide pitch competition.
Continue to launch cohorts ofAccelerateHER, a startup incubator program for early stage
startups led by women entrepreneurs.
Host technical meetups and events at Stoke.
Sponsor and support technical meetups and events in Denton and the region.
•
•
•
•
2.B.6. Promoting Denton’s Creative Brand
2B.6.2. Pitch stories about successful Denton companies to media outlets, such as the Denton
Record-Chronicle, Dallas Morning News, Fort Worth Star-Telegram, Dallas Innovates, and D
Magazine.
2B.6.3. Develop a Citywide entrepreneurial recognition program that harnesses the strengths of
local efforts that already exist in Denton.
2.B.6. Work Plan Items
• Continue to publish two to four blog posts each month, including a regular spotlight of a
mentor or members.
• Write and distribute press releases around entrepreneurial activity and Denton startups.
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• Initiate planning of a program that recognizes entrepreneurs, startups, organizations, and
educators that are having an impact on the entrepreneurial ecosystem.
Strategic Plan Goal 3. Strengthen Community Inclusion
3.3. Grow your Own Talent Initiative
3.3.1. Support youth entrepreneurship programs at the local level to foster a culture of
innovation and cultivate an entrepreneurial spirit.
3.3.2. Encourage Denton ISD to incorporate entrepreneurship into academic curricula and
increase exposure and access to Denton’s startups.
3.3 Work Plan Items
• Pursue partnership with Denton ISD to support entrepreneurial education and access to
Denton’s startups.
• Seek out opportunities to include Denton ISD students in mentorships programs and otherevents .
Offer tours to Denton ISD classes/clubs to share out Stoke Denton, its mission, and the
entrepreneurial experience.
Work with community members and partner organizations to pursue technical
entrepreneurial programming for youth.
Conduct community-wide surveys to learn ways that Stoke could provide better support
and resources for traditionally underserved and under-funded entrepreneurs to help
narrow the inequity gap.
•
•
•
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