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HomeMy WebLinkAboutContract 63862Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 CSC No. 63862 ECONOMIC DEVELOPMENT PROGRAM AGREEMENT This Economic Development Program Agreement ("Agreement") is entered into by and between the City of Fort Worth, a Texas home -rule municipal corporation ("City") and Ariat International, Inc., a California corporation ("Company"). RECITALS 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 is a performance footwear and apparel company focused on equestrian sports, work, and outdoor gear. It presently has its western U.S. regional headquarters, and a distribution facility located at 15201 Blue Mound Rd., Fort Worth, Texas. B. Company intends to (i) expand its regional headquarters ("Phase 1 Project") and (ii) construct and operate a new regional distribution center to be located at 2501 Eagle Parkway, Fort Worth, Texas ("Phase 2 Project"). These two projects, together in the aggregate, would result in approximately $72,600,000 in capital investment and 250 new jobs. C. For the Phase 1 Project, the Company, at a minimum, commits to (i) expend, or cause to be expended, at least $8,900,000 in property capital improvements, equipment, and related expenditures at the Phase 1 Project Site ($6,900,000 in Construction Costs and $2,000,000 in Taxable Business Personal Property; collectively "Phase 1 Project Required Improvements" at its regional headquarters) and (ii) create, or cause to be created, 150 new jobs with an average salary of $95,000 ("Phase 1 Project Employment Commitment"). D. For the Phase 2 Project, the Company, at a minimum, commits to (i) expend, or cause to be expended, at least $63,700,000 in property capital improvements, equipment, and related expenditures at the Phase 2 Project Site ($19,900,000 in Construction Costs and $43,800,000 in Taxable Business Personal Property; collectively "Phase 2 Project Required Improvements" at 2501 Eagle Parkway) and (ii) create, or cause to be created, 100 new jobs ("Phase 2 Project Employment Commitment"). E. In exchange for Company timely fulfilling its commitments described herein, City will provide (i) a one-time grant from the City's Economic Development Initiatives Fund ("EDIF") of up to $300,000 following the completion of the Phase I Project and (ii) up to five (5) annual Economic Development Program Agreement grants based on 70 percent of the maintenance and operations portion of incremental City property taxes on both real and business personal property ("Grants"). F. All commitments and obligations set forth in this Agreement may be performed by Company, an Affiliate, or a combination of either, in Company's discretion; however, Company EDPA - City of Fort Worth and Ariat International, Inc. OFFICIAL RECORD Page 1 of 19 FINAL 20250820 CITY SECRETARY FT. WORTH, TX Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 shall remain responsible for any Affiliates in the performance of any of the commitments or obligations set forth in this Agreement. G. The Company's commitments described herein will benefit the City by leading to increased employment in a target industry. H. As recommended by the City's 2023 Comprehensive Plan, adopted by the City Council pursuant to Ordinance No. 26050-03-2023 ("Comprehensive Plan"), and in accordance with the City of Fort Worth's Economic Development Program Policy ("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 ("380 Program"). I. The City Council has determined that the feasibility of the Company's proposed commitments described herein are contingent on Company's receipt of the Grants. J. The City Council has determined that the Company's proposed commitments described herein will benefit and stimulate the local economy and that the 380 Program is an appropriate means to achieve these projects. K. 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. L. 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: EDPA - City of Fort Worth and Ariat International, Inc. Page 2 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 a. 380 Program has the meaning ascribed to it in Recital H. b. Affiliate means all entities, incorporated or otherwise, under common control with, controlled by, or controlling the Company. For purposes of this definition, "control" means more than fifty percent (50%) ownership in Company or Affiliate as determined by either value or vote. C. Business Equity Firm ("BEF") has the meaning assigned to it in the City of Fort Worth's Business Equity Ordinance (Chapter 20, Article X of the City Code), as amended. below. d. BEF Construction Percentage has the meaning ascribed to it below. e. BEF Construction Spending Commitment has the meaning ascribed to it f. Certificate of Completion has the meaning ascribed to it below. g. Comptroller means the Texas Comptroller for Public Accounts. h. Construction Costs means the aggregate of Hard Construction Costs and the following costs directly expended for the Required Improvements: engineering fees; architectural and design fees; real estate commissions; costs of third -party consultants, including attorneys and environmental consultants; Company fees; zoning fees; insurance and taxes directly related to the construction of the Development; and financing costs, including capitalized interest and FF&E. Property acquisition costs do not constitute "Construction Costs." i. Director means the director of the City's Economic Development Department or that person's authorized designee. j. Effective Date is December 10, 2024. k. First Operating Year means the first full calendar year following the year in which the Project Sites Real Property Completion Date occurred. I. Job means a job provided to one (1) individual by Company, or staffing agency of Company, for at least forty (40) hours per week. M. Grant means the five (5) economic development grants paid by the City to Company in accordance with this Agreement and as part of the 380 Program. EDPA - City of Fort Worth and Ariat International, Inc. Page 3 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 n. Hard Construction Costs means the aggregate of the following costs expended by Company for the Required Improvements: actual site development and construction costs, contractor fees, and the costs of supplies and materials, but excludes land acquisition costs paid by Company for the various parcels that make up the Project Sites. o. New Job means a Job that was not in existence before, and the individual was hired after, the Effective Date. P. Phase 1 Proiect Emplovment Commitment has the meaning ascribed to it in Recital C. q. Phase 2 Proiect Emplovment Commitment has the meaning ascribed to it in Recital D. r. Phase 1 Proiect Site has the meaning ascribed to it in Recital C. S. Phase 2 Proiect Site has the meaning ascribed to it in Recital D. t. Phase 1 Proiect Required Improvements has the meaning ascribed to it in Recital C. U. Phase 2 Proiect Required Improvements has the meaning ascribed to it in Recital D. V. Policy has the meaning ascribed to it in Recital H. W. Proiect Sites mean both the Phase 1 Project Site and the Phase 2 Project Site. X. Proiect Sites Taxable Business Personal Propertv Deadline means December 31, 2028. Y. Proiect Sites Real Propertv Completion Date - Phase 1 means the date as of which all of Project Sites Phase 1 Project Required Real Property Improvements have been completed and all occupiable space within the Phase 1 Project Site has received a temporary or permanent certificate of occupancy. Z. Proiect Sites Real Propertv Completion Date — Phase 2 means the date as of which all of Phase 2 Project Required Real Property Improvements have been completed and all occupiable space with the Phase 2 Project Site has received a temporary or permanent certificate of occupancy. EDPA - City of Fort Worth and Ariat International, Inc. Page 4 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 2027. aa. Proiect Sites Real Property Completion Deadline means December 31, bb. Records has the meaning ascribed to it below. CC. Salary means a cash payment or remuneration made by Company to an individual for services rendered as an employee to Company, including any paid time off, commissions, bonuses, or equity paid in accordance with Company's published bonus plan, but does not include the value of any benefits provided to an employee or any reimbursements for actual and necessary expenses incurred by the employee in the course and scope of the employee's job duties. dd. All -New Jobs Average Salary has the meaning ascribed to it below. ee. Taxable Business Personal Propertv means property that can be owned and is not permanently attached to the land or building which would include, but not limited to, furniture, fixtures, equipment and machinery, computers, inventory held for sale or rental, raw materials, finished goods, and work in process that is used in a business or used to produce income. ff. Term has the meaning ascribed to it below. 3. Term. This Agreement will be effective as of the date this Agreement is signed by an Assistant City Manager of the City and unless terminated earlier pursuant to and in accordance with this Agreement, will expire ten years after the end of the year in which the Phase 1 Project has been completed ("Term"). 4. Company Obligations and Commitments. a. Use of Proiect Sites. From the Completion Date until expiration of the Term of this Agreement, Company must use the Project Sites for office, operations, service support, and/or warehouse operations. b. Required Improvements — Construction Costs (Required Real Propertv Improvements). i. Phase 1 Proiect Required Real Property Improvements. By the Project Sites Real Property Completion Deadline, Company must expend or cause to be expended at least Six Million and Nine Hundred Thousand and 00/100 Dollars ($6,900,000.00) in Construction Costs on the Phase 1 Project Required Real Property Improvements. ii. Phase 2 Proiect Required Real Propertv Improvements. By the Project Sites Real Property Completion Deadline, Company must expend or cause EDPA - City of Fort Worth and Ariat International, Inc. Page 5 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 to be expended at least Nineteen Million and Nine Hundred Thousand and 00/100 Dollars ($19,900,000.00) in Construction Costs on the Phase 2 Project Required Real Property Improvements. C. Required Improvements —Taxable Business Personal Property. i. Phase 1 Proiect Required Improvements. By the Project Sites Taxable Business Personal Property Completion Deadline, Company must install, or cause to be located, at least Two Million and 00/100 Dollars ($2,000,000.00) of Taxable Business Personal Property on the Phase 1 Project Site that was not previously located on the same. ii. Phase 2 Proiect Required Improvements. By the Project Sites Taxable Business Personal Property Completion Deadline, Company must install, or cause to be located, at least Forty -Three Million and Eight Hundred Thousand and 00/100 Dollars ($43,800,000.00) of Taxable Business Personal Property on the Phase 2 Project Site. d. Business Equity Firm Commitment. i. On or before the Project Sites Real Property Completion Deadline, Company aims to expend or cause to be expended at least fifteen percent (15%) of the total of all Construction Costs for both the Phase 1 Project Site and Phase 2 Project Site with BEFs ("BEF Construction Spending Commitment"). ii. The City will provide Company with a list of approved BEF vendors within 90 days of the date the City executes this Agreement. e. Employment Commitment. i. Phase 1 Proiect Emplovment Commitment. Company must provide, and maintain throughout the Term of the Agreement, a minimum of 150 New Jobs at the Phase 1 Project Site by December 31, 2032, with an average salary for the New Jobs of $95,000 annually. ii. Phase 2 Proiect Emplovment Commitment. Company must provide, and maintain throughout the Term of the Agreement, a minimum of 100 New Jobs at the Phase 2 Project Site by December 31, 2029. iii. Determination each year of compliance with the Employment Commitment will be based on the employment data provided to the City pursuant to this Agreement for the year under evaluation. EDPA - City of Fort Worth and Ariat International, Inc. Page 6 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 iv. Staffing agencies such as a third -party logistics firm are acceptable for the creation of eligible jobs under this Agreement. f. All -New Jobs Average Annual Salary. The All -New Jobs Average Annual Salary, measured on a calendar year basis, of All -New Jobs pursuant to both the Phase 1 Project Employment Commitment and Phase 2 Project Employment Commitment must equal at least $70,000.00 for the Term of the Agreement beginning December 31, 2032. The average salary of the Phase 1 Project Employment Commitment will remain $95,000 annually throughout the Term of the Agreement beginning December 31, 2032. There are no other salary requirements other than those set forth in Section 4.e.i. (Phase 1 annual New Job annual salary of $95,000) and this Section 4.f. (All -New Jobs Average Annual Salary of $70,000). g. Reports. i. Quarterly Reports — Construction Costs. From the Effective Date until the earlier of Project Sites Real Property Completion Date— Phase 1 or Project Sites Real Property Completion Deadline, Company must provide the Director with a calendar -year, quarterly report in a form reasonably acceptable to the Director that specifically outlines (i) the then -current aggregate Construction Costs expended for both the Phase 1 Project Required Real Property Improvements and Phase 2 Project Required Real Property Improvements; and (ii) the then -current aggregate Construction Costs expended with BEFs for the same. ii. Final Report — Construction Costs. Within sixty (60) calendar days following the earlier of Project Sites Real Property Completion Date — Phase 2 or Project Sites Real Property Completion Deadline, in order for the City to assess whether the Construction Costs for both the Phase 1 Project Required Real Property Improvements and Phase 2 Project Required Real Property Improvements and the applicable BEF Construction Spending Commitment have been met, Company must provide the Director with a report in a form reasonably acceptable to the Director that specifically outlines (i) the total Construction Costs expended or caused to be expended for the Construction Costs for Phase 1 Project Required Real Property Improvements and Phase 2 Project Required Real Property Improvements, respectively as of the earlier of Project Sites Real Property Completion Date — Phase 2 or Project Sites Real Property Completion Deadline and (ii) the total Construction Costs expended or caused to be expended with BEFs for both the Phase 1 Project Required Real Property Improvements and Phase 2 Project Required Real Property Improvements as of the earlier of Project Sites Real Property Completion Date — Phase 2 or Project Sites Real Property Completion Deadline, together with supporting invoices and other documents necessary to demonstrate that such amounts were actually paid, including, without limitation, final lien waivers signed by the general contractor for the Phase 1 Project Required EDPA - City of Fort Worth and Ariat International, Inc. Page 7 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 Real Property Improvements and Phase 2 Project Required Improvements, respectively. iii. Quarterly Reports - Taxable Business Personal Property. From the Effective Date until the Project Sites Taxable Business Personal Property Completion Deadline, Company must provide the Director with a calendar -year, quarterly report in a form reasonably acceptable to the Director that specifically outlines the then -current aggregate Taxable Business Personal Property, and the value of each item installed, or cause to be located, at both the Phase 1 Project Site and Phase 2 Project Site. iv. Final Reports — Taxable Business Personal Property. Within ninety (90) calendar days following the earlier of Project Sites Real Property Completion Date orthe Project Sites Taxable Business Personal Property Completion Deadline, in order for the City to assess whether the aggregate Taxable Business Personal Property to be installed, or cause to be located, the Phase 1 Project Site and Phase 2 Project Site, respectively, have been met, Company must provide a report in a form reasonably acceptable to the Director that specifically outlines all Taxable Business Personal Property, and the value of each item installed, or cause to be located, at each of the Phase 1 Project Site and Phase 2 Project Sites, respectively. V. Annual Employment and Salary Report. - Phase 1: On or before March 31, 2033 and March 31 of each year thereafter, in order for the City to assess the degree to which the Phase 1 Project Employment Commitment for the previous calendar year was met, as well as to verify the All -New Jobs Average Annual Salary and Phase 1 Project Employment Commitment annual salary, Company must provide the Director with a report, in a form reasonably acceptable to the Director, that sets forth the total number of individuals, and their individual salaries, who held New Jobs at each Project Site, as well as the Salary of each of the New Jobs, all as of December 31 (or such other date requested by Company and reasonably acceptable to the Director) of the previous calendar year, together with reasonable supporting documentation. Reports shall be redacted to remove confidential employee information. - Phase 2: On or before March 31, 2030 and March 31 of each year thereafter, in order for the City to assess the degree to which the Phase 2 Project Employment Commitment and the Phase 2 Project Employment Commitment for the previous calendar year was met, as well as to verify the All -New Jobs Average Annual Salary and Phase 2 Project Employment Commitment annual salary, Company must provide the Director with a report, in a form reasonably acceptable to the Director, that sets forth the total number of individuals, and their individual salaries, who held New EDPA - City of Fort Worth and Ariat International, Inc. Page 8 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 Jobs at each Project Site, as well as the Salary of each of the New Jobs, all as of December 31 (or such other date requested by Company and reasonably acceptable to the Director) of the previous calendar year, together with reasonable supporting documentation. Reports shall be redacted to remove confidential employee information. vi. Performance by Affiliates. The City will accept performance of any obligations set forth in this Section by an Affiliate of Company, with the understanding that Company will be responsible for preparing and providing all reports required hereunder, including the assembly of and access by the City to any data or information of an Affiliate that is reflected in any such report. vii. Additional Information. Company agrees to provide the City with any additional information that the Director may reasonably require to ascertain Company's compliance with this Agreement and to assist the City in properly calculating Grants payable in accordance with this Agreement. h. Performance Bonds. To ensure Company's adherence to its obligations and duties under this Agreement, and to protect the interests of the City, Company shall ensure a Performance Bond in the amount equal in value to the EDIF Grant (or any lesser amount of the EDIF Grant as may remain subject to Clawback in the manner discussed in Section 6.c.) is in effect for the duration of this Agreement as specified in this Section (the "Performance Bond"). i. Performance Bond. On or before the Completion Date, the Company shall deliver to the City a Performance Bond, in a form provided or approved by the City, in the dollar amount specified above and payable to the City. This Performance Bond shall be effective, and claims may be made upon it, in whole or in part, for at least twelve months after the Completion Date. Thereafter, the Company shall ensure a Performance Bond payable to the City in the amount specified above is effective and claims may be made upon it, in whole or in part, for a term ending no earlier than 180 days following the term of this Agreement. ii. Tvpes of Acceptable Performance Bonds. The Company shall satisfy its requirement to obtain a Performance Bond using one of the following methods: 1. Third -Party Performance Bond. The Company may comply with the requirements of Section 4.h. by obtaining a bond from a third - party surety company authorized to do business in the State of Texas, with the Company as the principal and the City as the obligee. The Third -Party Performance Bond must guarantee the Company's performance underthis Agreement and must include the requirements established in Section 4.h.iii. EDPA - City of Fort Worth and Ariat International, Inc. Page 9 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 2. Guarantee Agreement. In lieu of executing a Third -Party Performance Bond, the Company may comply with the requirements of Section 4.h. by executing a Guarantee Agreement, in the form and manner prescribed by the City, that guarantees the Company's performance under this Agreement. The Company's parent company must execute the Guarantee Agreement in which it agrees to pay the amount specified above if the City makes a claim on the Guarantee Agreement. The Guarantee Agreement must include the requirements established in Section 4.h.iii. iii. Claims. The Company shall ensure the Performance Bond is structured to authorize the City to make a claim on the Performance Bond, in whole or in part and in more than one occasion, as often as necessary, in the following circumstances: 1. Upon a Termination under Section 7 of this Agreement; 2. The Company commits an act that results in the loss of money or property by the City and that constitutes a default or one act in a series of repeated acts of possible default under this Agreement; 3. The Company is subject to a penalty under Section 6.c.; or 4. Any other instance in which the Company has unpaid amounts due and payable to the City under this Agreement. i. Inspections of Project Sites. At anytime during Company's normal business hours throughout the Term and following reasonable notice to Company, the City will have the right to inspect and evaluate the Project Sites, and any improvements thereon, and Company must provide full access to the same, in order for the City to monitor compliance with the terms and conditions of this Agreement. Company will cooperate fully with the City during any such inspection and evaluation. Notwithstanding the foregoing, Company will have the right to require that any representative of the City be escorted by a representative or security personnel of Company during any such inspection and evaluation. j. Audits. The City will have the right throughout the Term to audit the financial and business records of Company or any Affiliate that relate to both the Phase 1 Project Site Required Improvements and Phase 2 Project Site Required Improvements 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 at either of the Project Sites or at another location in the City with reasonable advance notice that is acceptable to both parties. Company will otherwise cooperate fully with the City during any audit assuming EDPA - City of Fort Worth and Ariat International, Inc. Page 10 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 that reasonable advance notice acceptable to both parties has been provided. This section will survive the expiration or early termination of this Agreement. 5. Certificates of Completion. The City shall issue Certificates of Completion for completion of (i) Phase 1 Project and (ii) Phase 2 Project. 6. Grants. a. Economic Development Initiatives Fund ("EDIF") Grant. Following the Company's timely completion of all of Phase 1 Project Required Improvements, the City, within sixty (60) days after the issuance of a Certificate of Completion on the Phase 1 Project, will make an EDIF grant payment in an amount not to exceed Three Hundred Thousand and 00/100 Dollars ($300,000.00) to Company from the City's EDIF. b. 380 Grant. Following the Company's (i) completion of both the Phase 1 Project Required Improvements and Phase 2 Project Required Improvements by the Project Sites Real Property Completion Deadline and the issuance of Certificates of Completion for the Project Sites, (ii) meeting both of the Phase 1 Project Employment Commitment by December 31, 2032 and Phase 2 Project Employment Commitment by December 31, 2029, the City, following the end of the First Operating Year and continuing annually thereafter for a period of five (5) years, will provide a Grant equal to seventy (70) percent of the City's incremental real property and taxable business personal property maintenance and operation tax revenues directly attributable to the Project Sites. The City will annually continue to fund this Grant provided Company maintains its Phase 1 Project Employment Commitment (and annual $95,000 salary requirement per each New Job), Phase 2 Project Employment Commitment, and All -New Jobs Annual Average Salary. The Grants will be paid by the City on or before June 1 of the Second Operating Year and on or before June of each subsequent Operating Year as may be applicable under this Agreement. C. Clawback. If at any time following delivery of a Grant, Company fails to maintain its Phase 1 Project Employment Commitment (and annual $95,000 salary requirement per each New Job), Phase 2 Project Employment Commitment, and All -New Jobs Annual Average Salary, Company will be responsible for returning, by payment to the City, no later than ninety (90) days following written notice from the City, an amount equal to the EDIF Grant paid (the "Clawback"). The amount of the EDIF Grant that is subject to Clawback will be reduced proportionally for each full Operating Year following the Completion Date in which Company successfully met the conditions specified in this Section 6.c, as discussed above. In the event of a failure by Company to make payment to the City for the Clawback, City will reserve the right to make a claim on the Performance Bond or to pursue collection of the amount due by any means allowable under the law. d. Source of Grant Funds. EDPA - City of Fort Worth and Ariat International, Inc. Page 11 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 i. It is understood and agreed that all Grants paid pursuant to this Agreement will come from currently available general revenues of the City and not directly from ad valorem taxes on the Project Site or improvements thereon that are received by the City. ii. Company understands and agrees that any revenues of the City other than those dedicated for payment of a given annual Grant pursuant to and in accordance with this Agreement may be used by the City for any lawful purpose that the City deems necessary in the carrying out of its business as a home -rule municipality and will not serve as the basis for calculating the amount of any future Grant or other obligation to Company. iii. Non -Appropriation of Funds. Expenditures not appropriated by the City in its current fiscal year budget are deemed to be contingent liabilities only and are subject to appropriation in subsequent fiscal year budgets. In the event no funds or insufficient funds are appropriated and budgeted in any subsequent fiscal period by the City for performance under this Agreement, the City shall notify Company and this Agreement shall terminate on the earlier of the last day of the fiscal period for which sufficient appropriation was made or whenever the funds appropriated for payment under this Agreement are exhausted. 7. Default, Termination, and Failure by Company to Meet Agreement Deadlines and Commitments. a. Failure to Meet Deadlines, Employment Commitments, and Salary Commitment. Notwithstanding anything to the contrary herein, the City will have the right to terminate this Agreement upon provision of written notice to Company, without further obligation to Company hereunder, if (i) the Project Sites Real Property Completion Deadline or Project Sites Taxable Business Personal Property Completion Deadline have not been met or (ii) Phase 1 Project Employment Commitment (and annual $95,000 salary requirement per each New Job). Upon written notice, Company will have 90 days to cure, or otherwise remedy the default, as applicable, or this Agreement will be terminated. b. Failure to Meet BEF Construction Spending Commitment. A percentage of the Grant will be based on whether the Company met the BEF Construction Commitment ("BEF Construction Percentage"). If Company meets the BEF Construction Commitment, the BEF Construction Percentage for each Grant hereunder will be ten percent (10%). If the Company does not meet the BEF Construction Commitment, the BEF Construction Percentage for each Grant hereunder will be zero percent (0%). C. Failure to Use Proiect Sites for Business Operations. If Company (i) fails to complete its requirements under this Agreement at location(s) within the City of Fort Worth for, at a minimum, its office, operations, service support, and/or warehouse operations for more than thirty (30) consecutive calendar days at any time during the EDPA - City of Fort Worth and Ariat International, Inc. Page 12 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 Term of this Agreement for any reason (other than on account of Company's temporary displacement caused by a casualty to such location and resulting ongoing repairs or restoration to that location necessitated by such casualty), Company will be in default under this Agreement and the City will have the right to terminate this Agreement following provision of notice and opportunity to cure in accordance with Section. d. Failure to Submit Reports. If Company fails to submit any report required by and in accordance with this Agreement, the City's obligation to pay any Grants at the time, 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 in accordance with Section 10 and opportunity to cure in accordance with Section 7.e. e. 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. f. Knowing Employment of Undocumented Workers. i. Company acknowledges that the City is required to comply with Chapter 2264, Texas Government Code, , 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 2264.001(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(f) (relating to federal criminal penalties and injunctions for a pattern or practice of employing unauthorized aliens): 1. 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 Grants received by Company hereunder, if any, plus Simple Interest at a rate of four percent (416) per annum; or EDPA - City of Fort Worth and Ariat International, Inc. Page 13 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 2. if such conviction occurs after expiration or termination of this Agreement based on conduct that occurred during the term 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 Grants received by Company hereunder, if any, plus Simple Interest at a rate of four percent (4%) per annum. ii. 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 Jobs Grants paid hereunder. This rate of interest can be applied each year but will only apply to the aggregate amount of Grants paid hereunder and is not applied to interest calculated. For example, if the aggregate amount of the 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 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 will survive the expiration or termination of this Agreement. 8. 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 Project 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. 9. INDEMNIFICATION. COMPANY, AT NO COST TO THE CITY, AGREES TO DEFEND, INDEMNIFY, AND HOLD THE CITY, ITS OFFICERS, AGENTS, SERVANTS, REPRESENTATIVES, AND EMPLOYEES, HARMLESS AGAINST ANY AND ALL CLAIMS, LAWSUITS, ACTIONS, COSTS AND EXPENSES OF ANY KIND, INCLUDING, BUT NOT LIMITED TO, THOSE FOR PROPERTY DAMAGE OR LOSS (INCLUDING 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 PROJECT SITE, OR ANY IMPROVEMENTS THEREON, INCLUDING THE REQUIRED EDPA - City of Fort Worth and Ariat International, Inc. Page 14 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 IMPROVEMENTS, OR ANY OTHER NEGLIGENT ACT OR OMISSION OF THE COMPANY THAT IS RELATED TO THE PERFORMANCE OF THIS AGREEMENT. THE COMPANY HAS NO INDEMNIFICATION OBLIGATION BEYOND THAT WHICH IS SET FORTH IN CATEGORIES (i) AND (ii) ABOVE. BY WAY OF EXAMPLE, THE COMPANY HAS NO DUTY TO INDEMNIFY THE CITY, ITS OFFICERS, AGENTS, SERVANTS, REPRESENTATIVES OR EMPLOYEES FOR ANY NEGLIGENT ACTOR OMISSION OR INTENTIONAL MISCONDUCT OF THE CITY, ITS OFFICERS, AGENTS, SERVANTS, REPRESENTATIVE, OR EMPLOYEES. 10. 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, electronic transmittal or by hand delivery: City: City of Fort Worth Attn: City Manager 100 Fort Worth Trail Fort Worth, Texas 76102 with copies to: the City Attorney AND the City's Economic Development Director at the same address Company: Ariat International, Inc. Attn: Pankaj Gupta, CFO, COO 1500 Alvarado Street, Ste 100 San Leandro, CA 94577 with copies to: Ariat International, Inc. Attn.: General Counsel 1500 Alvarado Street, Ste 100 San Leandro, CA 94577 Ryan, LLC Attn: Sharon Welhouse 301 Main Street Suite 1500 Baton Rouge, LA 70801 11. Assignment and Successor. 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 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 EDPA - City of Fort Worth and Ariat International, Inc. Page 15 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 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. 12. 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. 13. Governmental Powers. It is understood that by execution of this Agreement, the City does not waive or surrender any of its governmental powers or immunities. 14. 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 party's right to insist upon appropriate performance or to assert any such right on any future occasion. 15. 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. 16. 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. 17. 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. 18. Captions. Captions and headings used in this Agreement are for reference purposes only and will not be deemed a part of this Agreement. 19. 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. 20. 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 assignee 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 EDPA - City of Fort Worth and Ariat International, Inc. Page 16 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 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. 21. 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. 22. 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. 23. Authority to Execute Agreement. Each Party represents that it has obtained all necessary approvals, consents and authorizations to enter into this Agreement and to perform its duties under this Agreement; the person executing this Agreement on its behalf has the authority to do so; upon execution and delivery of this Agreement by the Parties, it is a valid and binding contract, enforceable in accordance with its terms; and the execution, delivery, and performance of this Agreement does not violate any bylaw, charter, regulation, state or federal law or any other governing authority of the Party. ----- This space left blank intentionally. ----- ----- Signature pages follow. ----- EDPA - City of Fort Worth and Ariat International, Inc. Page 17 of 19 FINAL 20250820 Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 CITY EXECUTED as of the last date indicated below. City of Fort Worth, a Texas home -rule municipal corporation C�4 v Signature By: Jesica McEachern Printed Name Assistant City Manager Title Signed on the 26 day of August , 2025. FOR CITY OF FORT WORTH INTERNAL PROCESSES: Approval Recommended: By: Name: Kevin Gunn Title: Interim Director, Econ. Development Approved as to Form and Legality By: t.uwffvw o, c"W� Name: Larry Collister Title: Sr. Assistant City Attorney Contract Authorization: M&C: 24-1156 (12/10/24) M&C: 25-0511 (06/10/25) Form 1295: 2024-1197380 (08/06/24) EDPA - City of Fort Worth and Ariat International, Inc. FINAL 20250820 Contract Compliance Manager: By signing I acknowledge that I am the person responsible for the monitoring and administration of this contract, including ensuring all performance and reporting requirements. By: P+I -iich [ �Jg25,20 11:12T 7: 99 CDT) Name: Michael Hennig Title: Economic Development Manager City Secretary: AoFgFonr °na evo Ito 0!`a gd0 �PPpr°�a a QQQIl nEoo sa6a By: Name: Jannette Goodall Title: City Secretary OFFICIAL RECORD CITY SECRETARY Page 18 of 19 FT. WORTH, TX Docusign Envelope ID: E8E81121-B741-4276-888A-0O3B398FA742 COMPANY Ariat International, Inc., a California corporation Signed by: Slgnff6fA7F638416_. By: Pankaj Gupta Printed Name COO/CFO Title Signed on the 21 day of August , 2025. EDPA - City of Fort Worth and Ariat International, Inc. Page 19 of 19 FINAL 20250820 ACITY COUNCIL AGEND Create New From This M&C Official site of the City of Fort Worth, Texas FoRTWORTti DATE: 6/10/2025 REFERENCE NO.: **M&C 25-0511 LOG NAME: 17ARIATEDPA AMENDM&C CODE: C TYPE: CONSENT PUBLIC NO HEARING: SUBJECT: (CD 10) Amend Mayor and Council Communication 24-1156 Authorizing Execution of an Economic Development Program Agreement with Ariat International, Inc. or Affiliate, for the Expansion of its Regional Headquarters at 15201 Blue Mound Road and for the Construction and Operation of a New Regional Distribution Center Generally Located at 2501 Eagle Parkway to Correct the Employment Requirement and Related Deadline for Each of Phase 1 and Phase 2 Respectively RECOMMENDATION: It is recommended that the City Council amend Mayor and Council Communication 24-1156 authorizing execution of an Economic Development Program Agreement with Ariat International, Inc. or Affiliate, for the expansion of its regional headquarters at 15201 Blue Mound Road and for the construction and operation of a new regional distribution center generally located at 2501 Eagle Parkway to correct the employment requirement and related deadline for each of Phase 1 and Phase 2 respectively. DISCUSSION: Ariat International, Inc. (Company) is a performance footwear and clothing company focused on equestrian sports, work, and outdoor gear. Company currently has a regional distribution hub and corporate office that serves as its western U.S. regional headquarters in Fort Worth, Texas and is proposing an expansion of its presence in Fort Woth that would result in approximately $72,600,000.00 in new capital investment and an additional 250 jobs. Company is seeking a regional corporate expansion that will involve approximately $8,900,000.00 in real property improvements, equipment, and other related expenditures (Phase 1 Project). The Phase 1 Project will accommodate 150 employees with $95,000.00 average salaries. Additionally, Company is seeking to establish a new regional distribution hub generally located at 2501 Eagle Parkway that will involve approximately $63,700,000.00 in real property improvements, equipment, and other related expenditures (Phase 2 Project). The Phase 2 Project will accommodate 100 employees. On December 10, 2024, the City Council approved M&C 24-1156 authorizing execution of an Economic Development Program Agreement with Ariat International, Inc. or affiliate, for the expansion of its regional headquarters at 15201 Blue Mound Rd. and for the construction and operation of a new regional distribution center generally located at 2501 Eagle Parkway to provide a one-time grant from the Economic Development Initiatives Fund and up to five Economic Development Program grants based on the new incremental value of City Maintenance and Operations taxes from property associated with the project, subject to certain performance requirements relating to real property improvements, equipment installations, and new employment. Among the Company commitments outlined in M&C 24-1156 were certain minimum requirements and deadlines relating to employment in association with the Phase 1 Project and the Phase 2 Project that were attributed to the incorrect phase and were therefore inconsistent with the deliverables outlined above. Therefore, staff recommends adoption of this Mayor & Council Communication, to amend M&C 24- 1156 to provide for the above in the following manner: Company must provide a minimum of 150 full-time jobs on the Phase 1 Project site on or before December 31, 2032, with average annual salaries of at least $95,000.00 for the duration of the Agreement. Company must also provide an additional 100 full-time jobs on the Phase 2 Project site by December 31, 2029, for a cumulative job total of 250 minimum jobs and maintain that level for the duration of the agreement, with a combined average salary of at least $70,000.00 across the Phase 1 Project and Phase 2 Project. The Company commitments relating to site improvements remain the same. As discussed in M&C 24-1156, Company is committing to expend or cause to be expended at least 15\% of all construction costs (Hard and Soft) for the Project as defined in Chapter 20, Article X of the City Code. Failure to meet this commitment will not constitute a default, but will result in a 10\% reduction of any grant payable by City to Company. This development is located in COUNCIL DISTRICT 10. FISCAL INFORMATION/CERTIFICATION: The Director of Finance certifies that approval of this agreement will have no material effect on the Fiscal Year 2025 Budget. While no current year impact is anticipated from this action, any effect on expenditures and revenues will be budgeted in future Fiscal Years and will be included in the long- term financial forecast. TO Fund Department Account Project Program I Activity I Budget Reference # Amount ID ID Year (Chartfield 2) FROM Fund Department Account Project ID ID Submitted for City Manager's Office by: Originating Department Head: Additional Information Contact: ATTACHMENTS Program Activity Budget Reference # Amount Year (Chartfield 2) Jesica McEachern (5804) Form 1295 Certificate 08.28.2024.pdf (CFW Internal) M&C 17ARIATEDPA.pdf (CFW Internal) Kevin Gunn (2015) Michael Hennig (6024)