HomeMy WebLinkAboutC2015-020 - 2/10/2015 - Approved FIRST AMENDMENT TO THE BUSINESS INCENTIVE AGREEMENT BETWEEN
THE CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION AND SAM
KANE BEEF PROCESSORS, INC
FOR CREATION AND RETENTION OF JOBS
This First Amendment to the Business Incentive Agreement ("Amendment") is entered into
between the Corpus Christi Business and Job Development Corporation ("Corporation") and
Sam Kane Beef Processors, LLC ("Sam Kane"), a Texas Limited Liability Company.
WHEREAS, the Corporation and Sam Kane entered into a certain Business Incentive
Agreement between the Corpus Christi Business and Job Development Corporation
("Corporation") and Sam Kane Beef Processors, LLC ("Sam Kane"), a Texas Limited Liability
Company for the creation of jobs at their beef processing facility located in Corpus Christi,
Texas, dated July 15, 2013 ("Agreement");
WHEREAS, Sam Kane has requested to accelerate the remaining incentive payments to be
paid this fiscal year;
WHEREAS, on January 19, 2015 the Board determined that it is in the best interests of the
citizens of Corpus Christi, Texas to amend the Agreement;
NOW, THEREFORE, in consideration of the covenants, promises, and conditions stated in the
Amendment, the Corporation and Sam Kane agree as follows:
1. The effective date of this Amendment is the latest date that either party executes this
Amendment.
2. Exhibit A of the Agreement is hereby amended such that Sections 1 and 2 thereof
are deleted and replaced with the following:
1. Sam Kane shall retain 739 full-time jobs during the term of this Agreement, with
an average annual salary of $27,700 per year. Sam Kane shall create at least 70
full-time jobs over the term of this Agreement.
a. Sam Kane has been paid $600,000 for the first year and will be paid
$2,400,000 in the second year.
b. Should the Company fall below the Performance Standards at the end of
the term of the Agreement, Sam Kane shall pay back the reduced
percentage of the Remaining Cash Incentive (as illustrated below). Such
reduction will be in that percentage equal to the percentage Sam Kane's
performance falls below the Performance Standards. However, if Sam
Kane's performance falls below 70% at the end of the term of the
Agreement, then Sam Kane shall pay back the Remaining Cash
Incentive.
As an illustration, the reduced Remaining Cash Incentive shall be
calculated as follows: if at the end of the term of the Agreement Sam
Kane only has 750 full-time employees, which represents 92.7% of 809
full-time employees, Sam Kane would be required to pay back 7.3% of
the Remaining Cash Incentive (i.e., $175,200). As a further illustration, if
at the end of the term of the Agreement Sam Kane only has 550 full-time
employees, which represents 68% of 809 full-time employees, Sam Kane
would be required to pay back the full amount of the Remaining Cash
Incentive.
2015-020 1
2/10/15
Res030414 lent Amendment Sam Kane 4 Type A Bus Incen Agmt Sam Kane Beef 01-20-15
Sam Kane Beef Processors Inc. INDEXED
c. Prior to receiving the above-described payment for the second year, Sam
Kane must provide to the Corporation a schedule that sets forth for Sam
Kane the capital invested to-date in Sam Kane by its current and prior
members;
d. During the term of this Agreement, Sam Kane's capital distributions will
be limited to "Tax Distributions," which are distributions to Sam Kane's
members that are limited to amounts intended to facilitate the members'
payment of their respective tax obligations relating to any calendar year.
If, however, during the term of this Agreement Sam Kane makes capital
distributions other than Tax Distributions, Sam Kane will be obligated to
return the $2,400,000 second year grant payment to the Corporation, and
the original performance standards, and associated $600,000 per year
incentive payments, will be restored as they currently appear on Exhibit A
of the Agreement.
[Remainder of Page Intentionally Left Blank]
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Type A Business Incentive Agreement Amendment Sam Kane 4 Type A Bus Incen Agmt Sam Kane Beef 01-20-15
Corpus Christi Busi -ss Job Develo•• - orporation
i
By: /AtA(
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Bart Bras •n
President
Date: /./b ( 15—
Attest:
By: 4-0----kz,T---2,1.PyCC..4%
becca Huerta
Assistant Secretary
Sam Kane Beef Processors, LLC
By: / A „ff.,
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Lo i- A inters, Jr. b L/�L
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Pre..is -nnt n1OUNCIL , 4
Date: r . 2 01,‘
THE STATE O TEX S SECRETARv
COUNTY OF NUECES
This instrument was acknowledged before me on Rtit4rty gg- , 2015, by Louis A.
Waters, Jr., President, for Sam Kane Beef Processors, LLC a Texas Limited Liability Company,
on behalf of the Sam Kane Beef Processors, LLC.
ACA (Al (//ir------_
Notary Public
State of Texas
,.�;.:.;:ya�y RICHARD WILLARD PAINTER1,a,' "; Notary Public.State of Texas
My Commission Expires
1‘?;iiikVMarch 13, 2015
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Type A Business Incentive Agreement Amendment Sam Kane 4 Type A Bus Incen Agmt Sam Kane Beef 01-20-15