Loading...
HomeMy WebLinkAboutContract 55376 DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 CSC No. 55376 ECONOMIC DEVELOPMENT PROGRAM AGREEMENT This ECONOMIC DEVELOPMENT PROGRAM AGREEMENT ("Agreement") is entered into by and between the CITY OF FORT WORTH (the "City"), a home rule municipality organized under the laws of the State of Texas, and ARIAT INTERNATIONAL, INC., a California corporation("Company"). RECITALS The City and Company hereby agree that the following statements are true and correct and constitute the basis upon which the City and Company have entered into this Agreement: A. Company designs, manufactures, and sells high quality and performance footwear, apparel and accessories in the work and equestrian industries. Company wishes to lease property located at 15201 Blue Mound Road("Development Site")to construct a new regional distribution hub and corporate office of not less than 800,000 square feet. Exhibit "A" contains a more detailed description of the Land and is attached hereto and made a part of this Agreement for all purposes. B. In order to encourage Company to undertake certain required improvements and job creation on the Development Site, the City has offered an economic development incentive consisting of (i) a nine (9)-year real and personal property tax abatement, as governed by that certain Tax Abatement Agreement to be by and between City, Company, and NP-OV Fort Worth Project 1, LLC, as authorized by the City Council's approval during its regular meeting on August 4, 2020, of agenda item M&C 20-0495 ("Tax Abatement Agreement") and (ii) a one-time grant payment to Company that is based on new job creation, as authorized by Chapter 380 of the Texas Local Government Code and governed by this Agreement. C. Company's investment in the Development Site and its operations thereon will benefit the City by increasing the scope of an important commercial operation in the City with significant opportunities for employment and tax base growth. D. As recommended by the City's 2020 Comprehensive Plan, adopted by the City Council pursuant to Ordinance No. 24071-03-2020 ("Comprehensive Plan"), and in accordance with Resolution No. 5039-01-2019 ("Economic Development Program Policy"or"Policy"),the City has established an economic development program pursuant to which the City will, on a case-by-case basis, offer economic incentives authorized by Chapter 380 of the Texas Local Government Code that include monetary loans and grants of public money, as well as the provision of personnel and services of the City, to businesses and entities that the City Council determines will promote state or local economic development and stimulate business and commercial activity in the City in return for verifiable commitments from such businesses or entities to cause specific employment and other public benefits to be made or invested in the City(11380 Program") OFFICIAL RECORD Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. CITY SECRETARY FT. WORTH, TX DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 E. The economic development grant set forth in this Agreement (referred to herein as the Jobs Grant) is authorized by Section 14 (Employment Designated Project Fund Incentives) of the Policy. F. The City Council has determined that the feasibility of the proposed business expansion project described herein is contingent on Company's receipt of the Jobs Grant. The City Council has determined that the development and use of the Jobs Grant will benefit and stimulate the local economy and that the 380 Program is an appropriate means to achieve this project. In addition,the City Council has determined that,by entering into this Agreement, the potential economic benefits that will accrue to the City are consistent with the City's economic development objectives, as outlined in the Comprehensive Plan. This Agreement is authorized by Chapter 380 of the Texas Local Government Code. NOW, THEREFORE, in consideration of the mutual benefits and promises contained herein and for other good and valuable consideration,the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: AGREEMENT 1. INCORPORATION OF RECITALS. The City Council has found, and the City and Company hereby agree, that the recitals set forth above are true and correct and form the basis upon which the parties have entered into this Agreement. 2. DEFINITIONS. In addition to other terms defined in the body of this Agreement, the following terms will have the definitions ascribed to them as follows: 380 Program has the meaning ascribed to it in Recital D. Affiliate means all entities,incorporated or otherwise,under common control with, controlled by or controlling Company. For purposes of this definition, "control" means fifty percent (50%) or more of the ownership determined by either value or vote. Development Site has the meaning ascribed to it in Recital A. Director means the director of the City's Economic Development Department or his authorized designee. Effective Date has the meaning ascribed to it in Section 3. Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 Full-time Equivalent Job means a job provided on the Development Site by Company or a Third-Party Logistics Provider to one (1) or more individuals for at least thirty(30)hours per week. Jobs Grant means the one-time economic development grant paid to Company from the City's Designated Project Fund under Section 14 of the Policy for Full-time Jobs retained for at least three (3)years at certain minimum Salary levels, as outlined in Section 4 of this Agreement. New Job has the meaning ascribed to it in Section 4. Policy has the meaning ascribed to it in Recital D. Records has the meaning ascribed to it in Section 6. Salary means direct pay and planned bonuses, but not benefits, expense reimbursements, or discretionary bonuses. Tax Abatement Agreement has the meaning ascribed to it in Recital B. Term has the meaning ascribed to it in Section 3. Third-Party Logistics Provider means a specialized provider offering distribution, warehousing and fulfillment services. 3. TERM. This Agreement will take effect on the last date as of which all parties have executed this Agreement("Effective Date"),and,unless terminated earlier pursuant to and in accordance with this Agreement, will expire on the date as of which the City has paid the Jobs Grant required hereunder ("Term"). 4. OBLIGATIONS AND COMMITMENTS. 4.1 Company will be entitled to receive a one-time Jobs Grant of up to Two Hundred Twelve Thousand Dollars and Zero Cents ($212,000.00) in accordance with the terms of this Agreement. 4.2 To receive the Jobs Grant, Company must employ and continually retain a certain number of new Full-Time Equivalent Jobs for a period of at least three consecutive years (each a "New Job"). A Full-Time Equivalent Job will be considered new if the individual was hired on or after December 31, 2021. 4.3 The amount of the Jobs Grant will be based on the number of New Full- time Equivalent Jobs at the Development Site as of December 31 of the year preceding the year in which the Jobs Grant is paid. Specifically, the amount of the Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 Jobs Grant will equal the sum of the "Maximum Amount Toward Jobs Grant Per New Job"referenced in the chart set forth in Exhibit"B",attached hereto and made a part of this Agreement for all purposes, applicable to each New Job. The number of New Jobs and the"Annual Salary of each New Job" (as set forth in Exhibit`B") will be determined on the basis of the annual employment and salary reports filed by Company in accordance with Section 5. 4.4 Company has the right to select the calendar year in which it desires the Jobs Grant to be calculated and paid, provided that the earliest year in which the Jobs Grant may be paid is 2025, with the last year being 2028. 4.5 City will pay the Company the Jobs Grant within thirty (30) days after the Director verifies the employment requirements set forth herein, including the number of New Jobs and the period of employment. 5. REPORTS. 5.1 Annual Employment and Salary Report. On or before February 1, 2022 and February 1 of each year thereafter, in order for the City to assess the degree to which the New Jobs for the previous calendar year were met, as well as to verify the average annual Salary of all New Jobs at the Development Site, Company must provide the Director with a report in a form reasonably acceptable to the Director that sets forth the total number of individuals who held Full-time Jobs at the Development Site, as well as the Salary of each, all as of December 31 (or such other date requested by Company and reasonably acceptable to the City) of the previous year, together with reasonable supporting documentation. 5.2 Additional Information. Company agrees to provide the City with any additional information that the City may reasonably require in order to ascertain Company's compliance with this Agreement and to assist the City in properly calculating the Annual Grants and the Jobs Grant payable in accordance with this Agreement. 6. AUDITS. The City will have the right throughout the Term, but no more than once per year, to audit the financial and business records of Company or any Affiliate that relate to this Agreement as well as any other documents necessary to evaluate Company's compliance with this Agreement or with the commitments set forth in this Agreement (collectively "Records"). Company must make all Records available to the City on the Development Site or at another location in the City acceptable to both parties following reasonable advance notice by the City and will otherwise cooperate fully with the City during any Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 audit. This provision will survive the expiration or early termination of this Agreement for a period of two years. 7. APPLICATION FEE AND FEE CREDIT. Company has paid an economic development incentive application fee of $5,000.00. Of this, $2,000.00 is non-refundable and will be used to offset costs incurred by City staff in processing the application and preparing this Agreement. 8. DEFAULT, TERMINATION AND FAILURE BY COMPANY TO MEET VARIOUS DEADLINES AND COMMITMENTS. 8.1. Failure to Submit Reports. If Company fails to submit any report required by and in accordance with Section 5, the City's obligation to pay any Jobs Grant, if any, will be suspended until Company has provided all required reports; provided, however, that if any report required hereunder is delinquent by more than one (1) year, the City will have the right to terminate this Agreement following provision of notice and opportunity to cure in accordance with Section 8.2 8.2. General Breach. Unless stated elsewhere in this Agreement, Company will be in default under this Agreement if Company breaches any term or condition of this Agreement. In the event that such breach remains uncured after thirty(30)calendar days following receipt of written notice from the City referencing this Agreement (or,if Company has diligently and continuously attempted to cure following receipt of such written notice but reasonably requires more than thirty (30) calendar days to cure, then such additional amount of time as is reasonably necessary to effect cure, as determined by both parties mutually and in good faith), the City will have the right to terminate this Agreement immediately by providing written notice to Company. 8.3. Knowing Employment of Undocumented Workers. Company acknowledges that the City is required to comply with Chapter 2264 of the Texas Government Code, enacted by House Bill 1196 (80th Texas Legislature), which relates to restrictions on the use of certain public subsidies. Company hereby certifies that Company, and any branches, divisions, or departments of Company, does not and will not knowingly employ an undocumented worker, as that term is defined by Section 2264.00](4) of the Texas Government Code. In the event that Company, or any branch, division, or department of Company,is convicted of a violation under 8 U.S.C.Section 1324a(fl (relating to federal criminal penalties and injunctions for a pattern or practice of employing unauthorized aliens): Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 • if such conviction occurs during the Term of this Agreement, this Agreement will terminate contemporaneously upon such conviction (subject to any appellate rights that may lawfully be available to and exercised by Company), and Company must repay, within one hundred twenty (120) calendar days following receipt of written demand from the City, the aggregate amount of the Program Grants received by Company hereunder, if any,plus Simple Interest at a rate of four percent (4016)per annum; or • if such conviction occurs after expiration or termination of this Agreement, subject to any appellate rights that may lawfully be available to and exercised by Company, Company must repay, within one hundred twenty (120) calendar days following receipt of written demand from the City, the aggregate amount of the Program Grants received by Company hereunder, if any,plus Simple Interest at a rate of four percent(4016)per annum. For the purposes of this Section, "Simple Interest" is defined as a rate of interest applied only to an original value, in this case the aggregate amount of Program Grants paid hereunder. This rate of interest can be applied each year, but will only apply to the aggregate amount of Program Grants paid hereunder and is not applied to interest calculated. For example, if the aggregate amount of the Program Grants paid hereunder is $10,000 and such amount is required to be paid back with four percent(4%)interest five years later, the total amount would be $10,000+ [5 x ($10,000 x 0.04)],which is $12,000. This Section 9.6 does not apply to convictions of any subsidiary or affiliate entity of Company,by any franchisees of Company, or by a person or entity with whom Company contracts. Notwithstanding anything to the contrary herein, this Section 9.6 will survive the expiration or termination of this Agreement. 9. INDEPENDENT CONTRACTOR. It is expressly understood and agreed that Company will operate as an independent contractor in each and every respect hereunder and not as an agent, representative or employee of the City. Company will have the exclusive right to control all details and day- to-day operations relative to the Required Improvements and the Development Site and any improvements thereon and will be solely responsible for the acts and omissions of its officers, agents, servants, employees, contractors, subcontractors, licensees and invitees. Company acknowledges that the doctrine of respondeat superior will not apply as between the City and Company, its officers, agents, servants, employees, contractors, subcontractors, licensees, and invitees. Company further agrees that nothing in this Agreement will be construed as the creation of a partnership or joint enterprise between the City and Company. Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 10. INDEMNIFICATION. COMPANY, AT NO COST TO THE CITY, AGREES TO DEFEND, INDEMNIFY AND HOLD HARMLESS THE CITY, ITS OFFICERS, AGENTS SERVANTS, REPRESENTATIVES, AND EMPLOYEES, AGAINST ANY AND ALL THIRD PARTY CLAIMS,LAWSUITS,ACTIONS, COSTS,AND EXPENSES OF ANY KIND, INCLUDING, BUT NOT LIMITED TO, THOSE FOR PROPERTY DAMAGE OR LOSS (INCLUDING, BUT NOT LIMITED TO, ALLEGED DAMAGE OR LOSS TO COMPANY'S BUSINESS AND ANY RESULTING LOST PROFITS) AND PERSONAL INJURY, INCLUDING, BUT NOT LIMITED TO, DEATH, THAT MAY RELATE TO,ARISE OUT OF, OR BE OCCASIONED BY(i) COMPANY'S BREACH OF ANY OF THE TERMS OR PROVISIONS OF THIS AGREEMENT OR (ii) ANY NEGLIGENT ACT OR OMISSION OR INTENTIONAL MISCONDUCT OF COMPANY, ITS OFFICERS, AGENTS, ASSOCIATES, EMPLOYEES, CONTRACTORS (OTHER THAN THE CITY) OR SUBCONTRACTORS, RELATED TO THE DEVELOPMENT SITE, OR OTHERWISE TO THE PERFORMANCE OF THIS AGREEMENT. 11. NOTICES. All written notices called for or required by this Agreement must be addressed to the following, or such other party or address as either party designates in writing, by certified mail, postage prepaid, or by hand delivery: City: Company: City of Fort Worth Ariat International, Inc. Attn: City Manager Attn: Pankaj Gupta 200 Texas Street 3242 Whipple Road Fort Worth, TX 76102 Union City, CA 94587 Legal@ariat.com with copies to: the City Attorney at the same address with copies to: and the following: Sharon Welhouse Principal City of Fort Worth Ryan, LLC Attn: Director 100 Congress Avenue,#1900 Economic Development Department Austin, Texas 78701 1150 South Freeway Sharon.Welhouse@ryan.com Fort Worth, TX 76104 12. ASSIGNMENT AND SUCCESSORS. Company may, at any time assign,transfer, or otherwise convey any of its rights or obligations under this Agreement to an Affiliate without the approval of the City so long Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 as Company,the Affiliate and the City first execute an agreement under which the Affiliate agrees to assume and be bound by all covenants and obligations of Company under this Agreement. Otherwise, Company may not assign, transfer or otherwise convey any of its rights or obligations under this Agreement to any other person or entity without the prior consent of the City Council, which consent will not be unreasonably withheld, conditioned on(i) the prior approval of the assignee or successor and a finding by the City Council that the proposed assignee or successor is financially capable of meeting the terms and conditions of this Agreement and(ii)prior execution by the proposed assignee or successor of a written agreement with the City under which the proposed assignee or successor agrees to assume and be bound by all covenants and obligations of Company under this Agreement. Any attempted assignment without the City Council's prior consent will constitute grounds for termination of this Agreement following ten (10) calendar days of receipt of written notice from the City to Company. Any lawful assignee or successor in interest of Company of all rights under this Agreement will be deemed "Company" for all purposes under this Agreement. 13. COMPLIANCE WITH LAWS, ORDINANCES, RULES AND REGULATIONS. This Agreement will be subject to all applicable federal, state and local laws, ordinances, rules and regulations, including, but not limited to, all provisions of the City's Charter and ordinances, as amended. 14. GOVERNMENTAL POWERS. It is understood that by execution of this Agreement, the City does not waive or surrender any of it governmental powers or immunities. 15. NO WAIVER. The failure of either party to insist upon the performance of any term or provision of this Agreement or to exercise any right granted hereunder will not constitute a waiver of that parry's right to insist upon appropriate performance or to assert any such right on any future occasion. 16. VENUE AND CHOICE OF LAW. If any action,whether real or asserted, at law or in equity, arises on the basis of any provision of this Agreement,venue for such action will lie in state courts located in Tarrant County, Texas or the United States District Court for the Northern District of Texas—Fort Worth Division. This Agreement will be construed in accordance with the laws of the State of Texas. Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 17. NO THIRD PARTY RIGHTS. The provisions and conditions of this Agreement are solely for the benefit of the City and Company, and any lawful assign or successor of Company, and are not intended to create any rights, contractual or otherwise, to any other person or entity. 18. INTERPRETATION. In the event of any dispute over the meaning or application of any provision of this Agreement, this Agreement must be interpreted fairly and reasonably, and neither more strongly for or against any party, regardless of the actual drafter of this Agreement. 19. CAPTIONS. Captions and headings used in this Agreement are for reference purposes only and will not be deemed a part of this Agreement. 20. SEVERABILITY. If any provision of this Agreement is held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired. 21. ENTIRETY OF AGREEMENT. This Agreement, including any exhibits attached hereto and any documents incorporated herein by reference, contains the entire understanding and agreement between the City and Company, and any lawful assign and successor of Company, as to the matters contained herein. Any prior or contemporaneous oral or written agreement is hereby declared null and void to the extent in conflict with any provision of this Agreement. Notwithstanding anything to the contrary herein, this Agreement may not be amended unless executed in writing by both parties and approved by the City Council of the City in an open meeting held in accordance with Chapter 551 of the Texas Government Code. 22. COUNTERPARTS. This Agreement may be executed in multiple counterparts, each of which will be considered an original,but all of which will constitute one instrument. 23. ELECTRONIC SIGNATURES This Agreement may be executed by electronic signature,which will be considered as an original signature for all purposes and have the same force and effect as an original signature. For these purposes, "electronic signature" means electronically scanned and transmitted versions (e.g. via pdf file or facsimile transmission) of an original signature, or signatures electronically inserted via software such as Adobe Sign. Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 EXECUTED as of the last date indicated below: CITY OF FORT WORTH: ARIAT INTERNATIONAL, INC. a California corporation: Docu Signed by: By: Jesus Chhaapa(Mar5,2(022111� By 1:18 CST) �� a Jesus Chapa ankaj upta Deputy City Manager CFO/COO Date: Mar 5, 2021 Date: 2/25/2021 CONTRACT COMPLIANCE MANAGER: By signing below, I hereby acknowledge that I am the person responsible for the monitoring and administration of this contract, including ensuring all performance and reporting requirements: By: Name of City Employee: Robert Sturns Title: Director APPROVED AS TO FORM AND LEGALITY: By: Tyler F. Wallach Assistant City Attorney M&C: 20-0495 (August, 4, 2020) Form 1295: 2020-578020 ATTEST .dpa`FORT � °°° Y By. �o Mary Kayser P v o o=� City Secretary ���'�°°° a41 00000°°° �EXAS��� OFFICIAL RECORD Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. CITY SECRETARY FT. WORTH, TX DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 EXHIBIT "A" Description and May Depicting the Development Site BEING a tract of land situated in the A. King Survey, Abstract No. 710, the W. Sample Survey, Abstract No. 1207,the L. Butler Survey,Abstract No. 64, and the A. Robertson Survey,Abstract No. 1553,Denton County,Texas and being part of that certain tract of land described by deed to M.T.Cole Family Partnership Number 2,LP,recorded in Instrument Number 2009102749,Deed Records,Denton County,Texas, said tract of land being more particularly described by metes and bounds as follows: COMMENCING at a point in the northerly right-of-way line of F.M. 156(variable width public right-of-way), recorded in Instrument Number 2007-110923, Deed Records, Denton County, Texas, the southeast corner of Lot 4, Block 1, Dave Addition, an addition to the City of Fort Worth, according to the plat recorded in Instrument Number 2018-152, Plat Records, Denton County, Texas, in a non-tangent curve to the left having a central angle of 15°36'59", a radius of 2,964.79 feet,a chord bearing and distance of South 84°36'55"West—805.57 feet and from which a found 1/2" iron rod with cap stamped "SPIARS ENG"bears South 80°58'17" East,a distance of 0.90 feet; With the north right-of-way line of said F.M.156 the following courses and distances: With said non-tangent curve to the left in a southwesterly direction,an arc length of 808.07 feet to a point for the most southerly southwest corner of said Lot 4, Block 1, Dave Addition, being in centerline of Elizabeth Creek and the POINT OF BEGINNING of herein described tract of land and the beginning of a non-tangent curve to the left having a central angle of 05°26'35",a radius of 2,964.79 and a chord bearing and distance of South 74°05'09"West—281.54 feet; With said non-tangent curve to the left in a southwesterly direction,an arc length of 281.65 feet to a point; South 81°12'39"West,a distance of 106.20 feet to a point for the beginning of a non-tangent curve to the left having a central angle of 26°37'57", a radius of 2,984.79 feet and a chord bearing and distance of South 56'02'18"West— 1,374.95 feet; With said non-tangent curve to the left in a southwesterly direction, an arc length of 1,387.40 feet to a point; South 47'16'39"East,a distance of 20.00 feet to a point for the beginning of a non-tangent curve to the left having a central angle of 01°1 F35", a radius of 2,964.79 feet and a chord bearing and distance of South 42°07'32" West—61.73 feet; With said non-tangent curve to the left in a southwesterly direction,an arc length of 61.73 feet to a point; South 41°31'45"West,a distance of 2,286.16 feet to a point for the beginning of a curve to the left having central angle of 00°50'15", a radius of 4,683.66 feet and a chord bearing and distance of South 41°06'37"West—68.46 feet; Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 With said curve to the left in a southwesterly direction,an are length of 68.46 feet to a point in the northerly right-of-way line of said F.M. 156; THENCE North 47°51'10" West, departing the northerly right-of-way line of said F.M. 156, crossing into said M.T. Cole Family Partnership No. 2,LP, a distance of 102.37 feet to a point; THENCE North 41°00'36"West, a distance of 100.72 feet to a point; THENCE North 47°51'10" West,a distance of 888.32 feet to a point; THENCE North 41°31'45" East,a distance of 1,171.00 feet to a point; THENCE North 19'04'13" East,a distance of 117.80 feet to a point; THENCE North 41°31'45" East,a distance of 75.59 feet to a point; THENCE North 63'59'17" East,a distance of 117.80 feet to a point; THENCE North 41°31'45"East,a distance of 888.30 feet to a point in the southerly line of a certain tract of land described in deed to Forestar(USA) Real Estate Group, Inc. recorded in Instrument Number 2018-27156, Deed Records, Denton County, Texas and the approximate centerline of Elizabeth Creek; THENCE with the approximate centerline of said Elizabeth Creek and with the southerly line of said to Forestar(USA)Real Estate Group, Inc. tract the following courses and distances: South 61°35'42"East,a distance of 77.25 feet to a point; South 75°35'06"East,a distance of 572.39 feet to a point; North 77°13'32" East,a distance of 487.75 feet to a point; North 29'1018" East,a distance of 163.71 feet to a point; South 80°48'42"East,a distance of 175.36 feet to a point; North 67°02'13" East,a distance of 406.53 feet to a point; North 47°37'34" East,a distance of 257.66 feet to a point; North 36°4V52" East,a distance of 119.87 feet to a point; North 80°04'54" East,a distance of 80.79 feet to a point; South 55°06'26"East,a distance of 248.69 feet to a point; South 04°57'53"East,a distance of 134.41 feet to a point; South 65°53'00" East, a distance of 67.91 feet to the POINT OF BEGINNING and containing a calculated area of 3,257,120 square feet or 74.773 acres of land. Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 15201 Blue Mound Road Fort Worth, TX 76052 CO WeOy HIGHWAY�174 c WARLEY �� m vTEXAN' 4• r i 0 Y J 2 I K 0 Z I J� BNSF Internnodal .; Facility Alliance Airport Copyright 2020 City of Fort Worth.Unauthorized reproduction is a violation of applicable laws.This products of for informational purposes and may not have been prepared for or be suitable for legal,engineering,or surveying purposes.It does not represent an on-the-ground survey and represents on the approximate relative location of property boundaries.The City of Fort Worth assumes no responsibility for the accuracy of said data. Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. DocuSign Envelope ID:5D3608C4-C95D-4E14-BB71-EFD696B635C8 EXHIBIT "B" Chart for New Jobs Eligible for Jobs Grant from Employment Designated Proiect Fund Maximum Amount Toward Jobs Grant Annual Salary of each New Job Per New Job $58,552-$73,111 $1,000 $73,112-$87,671 $1,500 $87,672-$102,231 $2,000 $102,232 or above $2,500 Economic Development Program Agreement between City of Fort Worth and Ariat International,Inc. 12/28/2020 M&C Review Official site of the City of Fort Worth,Texas CITY COUNCIL AGENDA FORTTII DATE: 8/4/2020 REFERENCE M&C 20- LOG NAME: 17ARIATINCENTIVEAGREEMENT NO.: 0495 CODE: C TYPE: NOW PUBLIC NO CONSENT HEARING: SUBJECT. (CD 7)Authorize Execution of Tax Abatement and Economic Development Program Agreement with Ariat International, Inc. and NP-OV Fort Worth Project 1, LLC, or Affiliates, for a Corporate Office and Regional Distribution Hub to be Located at 15201 Blue Mound Road in Tax Abatement Reinvestment Zone No. 100, City of Fort Worth Texas (Continued from a Previous Meeting) RECOMMENDATION: It is recommended that:the City Council: 1. Authorize the City Manager to execute a 9-year Tax Abatement Agreement with Ariat International, Inc. and NP-OV Fort Worth Project 1, LLC, or affiliates„ for development an approximately 800,000 square foot corporate office and regional distribution hub to be located at 15201 Blue Mound Road in Tax Abatement Reinvestment Zone No. 100, City of Fort Worth Texas; and 2. Authorize the City Manager to execute an Economic Development Program Agreement with Ariat International, Inc., or an affiliate, for a one-time grant from the Economic Development Designated Project Fund based on new job creation, as authorized by Chapter 380 of the Texas Local Government Code and Section 14 of the City's Economic Development Program Policy. DISCUSSION: As part of a competitive site selection process, Ariat International, Inc. ("Company"), is considering the lease of approximately 800,000 square feet of an exsiting office/manufacturing facility owned by NP-OV Fort Worth Project 1, LLC ("Owner") at 15201 Blue Mound Road ("Project Site"). The Project Site would be redeveloped into a regional distribution hub and corporate office for Company's business operations. In order to facilitate the selection of Fort Worth as the preferred location, staff is proposing that the City enter into a Tax Abatement Agreement with Company and Owner to incentivize Company's decision.. Under the proposed terms, Company will expend or cause to be expended a minimum of $43,000,000 in construction costs for the required improvements by the "completion date", which will be the date as of which all occupiable space comprising the Development has received a temporary or final certificate of occupancy from the City. The completion date for the Development must occur on or before December 31, 2021. Company must locate or cause to be located taxable business personal property (BPP) that is new to the City of Fort Worth on the Project Site having a minimum taxable appraised value of $30,000,000 by January 1, 2022. The Company will spend or cause to be expended 15\% of total construction costs (hard and soft) for the required improvements with contractors that are Minority/Women Owned Business Enterprise companies located within the market areas applicable to the six county areas where the City spends 80\% of its tax dollars. Those counties are Tarrant, Dallas, Denton, Johnson, Parker and Wise. Only firms with a principal office in the market area will be counted towards the M/WBE goals. Failure to meet the M/WBE construction requirement will result in a reduction of the maximum potential grant percentage by 10 percentage points. Company must provide a minimum of 450 full-time jobs (consisting of 75 Ariat-employed corporate office positions and 375 indirect employees from a third-party provider) on the Project Site under the schedule below. The average annual salary for all full-time jobs must be a minimum of$43,992.00. 75 full time jobs as of December 31, 2021 125 additional full-time jobs as of December 31, 2022 (total 200 jobs) 125 additional full-time jobs as of December 31, 2023 (total 325 jobs) 125 additional full-time jobs as of December 31, 2024 (total 450 jobs) apps.cfwnet.org/council_packet/mc_review.asp?ID=28064&councildate=8/4/2020 1/3 12/28/2020 M&C Review In return, the City will grant a 40 percent tax abatement on the incremental increase in value of real and personal property improvements for a period of nine years. Company must meet specific construction spending and annual employment commitments in order to achieve the maximum amount of potential incentive for each abatement year. Maximum Potential Abatement Percentage with Corresponding Commitments Property Owner or Company Commitment Potential Abatement Base Commitment: Real and Personal Property Investment = $73,000,000 25\% (Base Commitment will be reduced by 10\% if MWBE Commitment is not met) Annual Commitments: Average Annual Salary for all Full-Time Jobs > $43,992.00 10\% Overall Employment Per Schedule Outlined Above 5\% TOTAL* 40\% Staff is also recommending that the City enter into an Economic Development Program Agreement with Company pursuant to Section 14 of the Economic Development Program Policy. Under the Economic Development Program Agreement, the City will provide a one-time cash grant from the Designated Project Fund of up to $212,000.00 to be paid upon confirmation of job creation and retention for a minimum of three years as of December 31 of the year preceding the year in which the grant is paid. Company will have the right to select the year in which it wishes the grant to be calculated and paid, provided that the earliest year in which the grant may be paid will be 2025 (based on verified employment and retention for a minimum of three years as of December 31, 2024) and the last year in which the grant may be paid will be 2028 (based on verified employment and retention for a minimum of three years as of December 31, 2027). The specific amount of the grant will be based on the number of such jobs that pay salaries in accordance with the following table: TABLE III-II Maximum Amount per New Position Maximum Amount Per New Minimum Annual Wage Rate Position $58,552 - $73,111 $1,000 $73,112 - $87,671 $1,500 $87,672 - $102,231 $2,000 $102,232 or above $2,500 The City will not pay a grant for any new jobs created after December 31, 2024. This project is located in COUNCIL DISTRICT 7. FISCAL INFORMATION/CERTIFICATION: The Director of Finance certifies that upon final approval of the Tax Abatement Agreement, a loss of 40% of property tax revenue may occur over the next nine years. This reduction in revenue will be incorporated into the long term financial forecast upon the Tax Abatement being officially granted. TO Fund Department Account Project Program Activity Budget Reference# Amount ID ID Year Chartfield 2 FROM apps.cfwnet.org/council_packet/mc_review.asp?ID=28064&councildate=8/4/2020 2/3 12/28/2020 M&C Review F l(Dund d Department Account Project Program Activity Budget Reference# Amount ID ID Year Chartfield 2 Submitted for City Manager's Office by_ Jay Chapa (5804) Originating Department Head: Robert Sturns (2663) Additional Information Contact: Robert Sturns (2663) ATTACHMENTS apps.cfwnet.org/council_packet/mc_review.asp?ID=28064&councildate=8/4/2020 3/3