HomeMy WebLinkAboutC2015-076 - 5/12/2015 - Approved BUSINESS INCENTIVE AGREEMENT BETWEEN
THE CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION AND
GOVIND DEVELOPMENT, LLC FOR CREATION AND RETENTION OF JOBS
This Business Incentive Agreement for Capital Investments and the Creation and Retention of
Jobs ("Agreement") is entered into between the Corpus Christi Business and Job Development
Corporation ("Corporation") and Govind Development, LLC ("Govind"), a Texas Domestic
Limited Liability Company.
WHEREAS, the Texas Legislature in Section 4A of Article 5190.6, Vernon's Texas Revised Civil
Statutes (Development Corporation Act of 1979), now codified as Subtitle C1, Title 12, Texas
Local Government Code, Section 504.002 et seq, ("the Act"), empowered local communities
with the ability to adopt an optional local sales and use tax as a means of improving the
economic health and prosperity of their citizens;
WHEREAS, on November 5, 2002, residents of the City of Corpus Christi ("City") passed
Proposition 2, New and Expanded Business Enterprises, which authorized the adoption of a
sales and use tax for the promotion and development of new and expanded business
enterprises at the rate of one-eighth of one percent to be imposed for 15 years;
WHEREAS, the 1/8th cent sales tax authorized by passage of Proposition 2 was subsequently
enacted by the City Council and filed with the State Comptroller of Texas, effective April 1,
2003, to be administered by the Corpus Christi Business and Job Development Corporation
Board;
WHEREAS, the Corpus Christi Business and Job Development Corporation exists for the
purposes of encouraging and assisting entities in the creation of jobs for the citizens of Corpus
Christi, Texas;
WHEREAS, the Board of Directors of the Corporation ("Board"), on October 18, 2010, amended
the Corporation's Guidelines and Criteria for Granting Business Incentives ("Type A
Guidelines"), which the City Council approved on November 9, 2010;
WHEREAS, Section 501.073 of the Act requires the City Council to approve all programs and
expenditures of the Corporation;
WHEREAS, Govind Development , LLC is a full service, multi-discipline engineering firm located
at 9359 IH 37, Corpus Christi, Texas;
WHEREAS, Govind proposes to invest approximately $1,000,000 over a five year period;
WHEREAS, on March 9, 2015 the Board determined that it is in the best interests of the citizens
of Corpus Christi, Texas that business development funds be provided to Govind, through this
Agreement with Govind, to be used by Govind to expand their engineering facility and will result
2015-076 1
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Ord.030500
Govind Development LLC INDEXED
in the creation of 44 full-time jobs and the retention of 162 existing full-time jobs, with an
estimated annual average salary of$87,200.
In consideration of the covenants, promises, and conditions stated in this Agreement,
Corporation and Govind agree as follows:
1. Effective Date. The effective date of this Agreement ("Effective Date") is the latest date that
either party executes this Agreement.
2. Term. The term of this Agreement is for five years beginning on the effective date.
3. Performance Requirements and Grants. The Board awarded a grant of$908,000 to be paid
out over five years.
a. Govind shall invest at least $1,000,000 to expand their offices inside Corpus Christi,
over a five year period. The company agrees that they shall provide adequate
documentation that they comply with the guidelines and criteria for creation of
primary jobs as a Primary Employer (Type A Guidelines) as approved by
Council, November 9, 2010. Govind shall further, over the term of this
Agreement, create 44 full-time jobs and retain 162 full-time jobs, with an average
annual salary of$87,200 as described in the schedule below.
Year Number of Number of Annual Payroll Capital
New Jobs Retained Jobs Investment
1 0 162 _ 14,126,400 1,000,000
2 44 162 _ 17,963,200 0
3 0 206 17,963,200 0
4 0 206 17,963,200 0
5 0 206 17,963,200 0
b. One-third of the grant or $302,600 will be paid out on the signing of the agreement
and proof of 162 retained jobs. The remaining $605,400 will be paid out as $151,350 in
years 2 through 5 per year.
c. Should the Company fall below any of the Performance Standards in any one year,
the Company shall receive a reduced percentage of the Cash Incentive in effect that
year. Such reduction will be in that percentage equal to the percentage the Company's
performance falls below the Performance Standards. However if the Company falls
below 70% of any of the standards, there is no payment for that year. In the event of a
conflict between any of the provisions of this contract, the provision that results in the
smallest incentive payment shall prevail.
d. The Corporation will award a grant to Govind payable not later than May 15 of years 2
through 5.
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e. Govind will display signage that states that they are recipients of Type A funding. This
signage will be created at the company's own expense and will be displayed in a
location that is visible to a visitor to their facility. All Type A funded projects must have
signage erected in a prominent publicly visible area acknowledging funding. The grantee
must pay for the signage and a photo must be submitted as part of contract compliance.
Signage must include:
• Approved Type A logo (provided by the Board)
• Indoor signage must be a minimum of 10" x 10"; Outdoor signage must be a
minimum of 12" x 12" (only one sign is required)
• Made of durable materials as to placement
• Displayed during the length of the contract
• Worn or damaged signs must be replaced as necessary
Additional acknowledgement beyond signage is encouraged at the discretion of the
grantee which could include websites, media coverage, special events, etc.
4. Job Creation Qualification.
a. In order to count as a created job under this Agreement, a "job" must be as defined in
the Type A Guidelines as a full-time employee, contractor, consultant, or leased
employee who has a home address in the Corpus Christi MSA.
b. Govind agrees to confirm and document to the Corporation that the minimum number
of jobs created as a result of funding provided by this Agreement is maintained
throughout the term by the Business.
c. Govind agrees to provide Corporation with a sworn certificate by authorized
representatives of each business assisted under this Agreement certifying the number of
full-time permanent employees employed by the business.
d. Govind shall ensure that the Corporation is allowed reasonable access to personnel
records of the businesses assisted under this Agreement.
5. Utilization of Local Contractors and Suppliers. Govind agrees to exercise reasonable efforts
in utilizing local contractors and suppliers in the construction of the Project, except where not
reasonably possible to do so without added expense, substantial inconvenience, or sacrifice in
operating efficiency in the normal course of business, with a goal of 50% of the total dollar
amount of all construction contracts and supply agreements being paid to local contractors and
suppliers. For the purposes of this section, the term "local" as used to describe manufacturers,
suppliers, contractors, and labor includes firms, businesses, and persons who reside in or
maintain an office within a 50 mile radius of Nueces County. Govind agrees, during the
construction of the Project and for four years after Completion, to maintain written records
documenting the efforts of Govind to comply with the Local Requirement, and to provide an
annual report to the City Manager or designee, from which the City Manager or designee shall
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determine if Govind is in compliance with this requirement. Failure to substantially comply with
this requirement, in the sole determination of the City Manager or designee, shall be a default
hereunder.
6. Utilization of Disadvantaged Business Enterprises ("DBE"). Govind agrees to exercise
reasonable efforts in utilizing contractors and suppliers that are determined to be disadvantaged
business enterprises, including minority business enterprises women-owned business
enterprises and historically-underutilized business enterprises. In order to qualify as a business
enterprise under this provision, the firm must be certified by the City, the Regional
Transportation Authority or another governmental entity in the jurisdiction of the home office of
the business as complying with state or federal standards for qualification as such an enterprise.
Govind agrees to a goal of 30% of the total dollar amount of all construction contracts and
supply agreements being paid to disadvantaged business enterprises, with a priority made for
disadvantaged business enterprises which are local. Govind agrees, during the construction of
the Project and for four years after Completion, to maintain written records documenting the
efforts of Govind to comply with the DBE Requirement, and to provide an annual report to the
City Manager or designee, from which the City Manager or designee shall determine if Govind is
in compliance with this requirement. Failure to substantially comply with this requirement, in the
sole determination of the City Manager or designee, shall be a default hereunder. For the
purposes of this section, the term "local" as used to describe contractors and suppliers that are
determined to be disadvantaged business enterprises, including minority business enterprises
women-owned business enterprises and historically-underutilized business enterprises includes
firms, businesses, and persons who reside in or maintain an office within a 50 mile radius of
Nueces County.
7. Living Wage Requirement. In order to count as a permanent full-time job under this
agreement, the job should provide a "living wage" for the employee. The target living wage
under this agreement is that annual amount equal or greater than poverty level for a family of
three, established by the U.S. Department of Health and Human Services Poverty Guidelines,
divided by 2,080 hours per year for that year.
8. Health Insurance. To qualify for this incentive, an employer shall certify that it has offered a
health insurance program for its employees during the term of the Agreement.
9. Warranties. Govind warrants and represents to Corporation the following:
a. Govind is a corporation duly organized, validly existing, and in good standing under
the laws of the State of Texas, has all corporate power and authority to carry on its
business as presently conducted in Corpus Christi, Texas.
b. Govind has the authority to enter into and perform, and will perform, the terms of this
Agreement to the best of its ability.
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c. Govind has timely filed and will timely file all local, State, and Federal tax reports and
returns required by laws to be filed and all Texas, assessments, fees, and other
governmental charges, including applicable ad valorem taxes, have been timely paid,
and will be timely paid , during the term of this Agreement.
d. Govind has received a copy of the Act, and acknowledges that the funds granted in
this Agreement must be utilized solely for purposes authorized under State law and by
the terms of this Agreement.
e. The person executing this Agreement on behalf of Govind is duly authorized to
execute this Agreement on behalf of Govind.
f. Govind does not and agrees that it will not knowingly employ an undocumented
worker. If, after receiving payments under this Agreement, Govind is convicted of a
violation under §U.S.C. Section 1324a(f), Govind shall repay the payments received
under this Agreement to the City, with interest at the Wall Street Journal Prime Rate, not
later than the 120th day after the date Govind has been notified of the violation.
10. Compliance with Laws. During the Term of this Agreement, Govind shall observe and obey
all applicable laws, ordinances, regulations, and rules of the Federal, State, county, and city
governments.
11. Non-Discrimination. Govind covenants and agrees that Govind will not discriminate nor
permit discrimination against any person or group of persons, with regard to employment and
the provision of services at, on, or in the Facility, on the grounds of race, religion, national origin,
marital status, sex, age, disability, or in any manner prohibited by the laws of the United States
or the State of Texas.
12. Force Majeure. If the Corporation or Govind are prevented, wholly or in part, from fulfilling
its obligations under this Agreement by reason of any act of God, unavoidable accident, acts of
enemies, fires, floods, governmental restraint or regulation, other causes of force majeure, or by
reason of circumstances beyond its control, then the obligations of the Corporation or Govind
are temporarily suspended during continuation of the force majeure. If either party's obligation
is affected by any of the causes of force majeure, the party affected shall promptly notify the
other party in writing, giving full particulars of the force majeure as soon as possible after the
occurrence of the cause or causes relied upon.
13. Assignment. Govind may not assign all or any part of its rights, privileges, or duties under
this Agreement without the prior written approval of the Corporation and City. Any attempted
assignment without approval is void, and constitutes a breach of this Agreement.
14. Indemnity. Govind covenants to fully indemnify, save, and hold harmless the
Corporation, the City, their respective officers, employees, and agents (`Indemnitees")
against all liability, damage, loss, claims demands, and actions of any kind on account of
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personal injuries (including, without limiting the foregoing, workers' compensation and
death claims), or property loss or damage of any kind, which arise out of or are in any
manner connected with, or are claimed to arise out of or be in any manner connected
with Govind activities conducted under or incidental to this Agreement, including any
injury, loss or damage caused by the sole or contributory negligence of any or all of the
Indemnitees. Govind must, at its own expense, investigate all those claims and
demands, attend to their settlement or other disposition, defend all actions based on
those claims and demands with counsel satisfactory to lndemnitees, and pay all charges
of attorneys and all other cost and expenses of any kind arising from the liability,
damage, loss, claims, demands, or actions.
15. Events of Default by Govind. The following events constitute a default of this Agreement by
Govind:
a. The Corporation or City determines that any representation or warranty on behalf of
Govind contained in this Agreement or in any financial statement, certificate, report, or
opinion submitted to the Corporation in connection with this Agreement was incorrect or
misleading in any material respect when made;
b. Any judgment is assessed against Govind or any attachment or other levy against the
property of Govind with respect to a claim remains unpaid, undischarged, or not
dismissed for a period of 120 days.
c. Govind makes an assignment for the benefit of creditors.
d. Govind files a petition in bankruptcy, or is adjudicated insolvent or bankrupt.
e. If taxes owed by Govind become delinquent, and Govind fails to timely and properly
follow the legal procedures for protest or contest.
f. Govind changes the general character of business as conducted as of the date this
Agreement is approved by the Corporation.
g. Govind fails to comply with one or more terms of this Agreement.
16. Notice of Default. Should the Corporation or City determine that Govind is in default
according to the terms of this Agreement, the Corporation or City shall notify Govind in writing of
the event of default and provide 60 days from the date of the notice ("Cure Period") for Govind
to cure the event of default.
17. Results of Uncured Default by Govind. After exhausting good faith attempts to address any
default during the Cure Period, and taking into account any extenuating circumstances that
might have occurred through no fault of Govind, as determined by the Board of Directors of the
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Corporation, the following actions must be taken for any default that remains uncured after the
Cure Period.
a. Govind shall immediately repay all funds paid by Corporation to them under this
Agreement.
b. Govind shall pay Corporation reasonable attorney fees and costs of court to collect
amounts due to Corporation if not immediately repaid upon demand from the
Corporation.
c. Upon payment by Govind of all sums due, the Corporation and Govind shall have no
further obligations to one another under this Agreement.
18. No Waiver.
a. No waiver of any covenant or condition, or the breach of any covenant or condition of
this Agreement, constitutes a waiver of any subsequent breach of the covenant or
condition of the Agreement.
b. No waiver of any covenant or condition, or the breach of any covenant or condition of
this Agreement, justifies or authorizes the nonobservance on any other occasion of the
covenant or condition or any other covenant or condition of this Agreement.
c. Any waiver or indulgence of Govind's default may not be considered an estoppel
against the Corporation.
d. It is expressly understood that if at any time Govind is in default in any of its conditions
or covenants of this Agreement, the failure on the part of the Corporation to promptly
avail itself of the rights and remedies that the Corporation may have, will not be
considered a waiver on the part of the Corporation, but Corporation may at any time
avail itself of the rights or remedies or elect to terminate this Agreement on account of
the default.
19. Govind specifically agrees that Corporation shall only be liable to Govind for the actual
amount of the money grants to be conveyed to Govind, and shall not be liable to Govind for any
actual or consequential damages, direct or indirect, interest, attorney fees, or cost of court for
any act of default by Corporation under the terms of this Agreement. Payment by Corporation is
strictly limited to those funds so allocated, budgeted, and collected solely during the grant term
of this Agreement. Corporation shall use its best efforts to anticipate economic conditions and
to budget accordingly. However, it is further understood and agreed that, should the actual total
sales tax revenue collected for any one year be less than the total amount of grants to be paid
to all contracting parties with Corporation for that year, then in that event, all contracting parties
shall receive only their pro rata share of the available sales tax revenue for that year, less
Corporation's customary and usual costs and expenses, as compared to each contracting
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parties' grant amount for that year, and Corporation shall not be liable to for any deficiency at
that time or at any time in the future. In this event, Corporation will provide all supporting
documentation, as requested. Payments to be made shall also require a written request from
Govind to be accompanied by all necessary supporting documentation.
20. The parties mutually agree and understand that funding under this Agreement is subject to
annual appropriations by the City Council; that each fiscal year's funding must be included in the
budget for that year; and the funding is not effective until approved by the City Council.
21. Notices.
a. Any required written notices shall be sent mailed, certified mail, postage prepaid,
addressed as follows:
Govind:
Govind Development, LLC
Attn: Mr. Govind Nadkarni
9359 IH 37
Suite A
Corpus Christi, Texas 78409
Corporation:
City of Corpus Christi
Business and Job Development Corporation
Attn.: Executive Director
1201 Leopard Street
Corpus Christi, Texas 78401
b. A copy of all notices and correspondence must be sent the City at the following
address:
City of Corpus Christi
Attn.: City Manager
P.O. Box 9277
Corpus Christi, Texas 78469-9277
c. Notice is effective upon deposit in the United States mail in the manner provided
above.
22. Incorporation of other documents. The Type A Guidelines, as amended, are incorporated
into this Agreement.
23. Amendments or Modifications. No amendments or modifications to this Agreement may be
made, nor any provision waived, unless in writing signed by a person duly authorized to sign
Agreements on behalf of each party.
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24. Relationship of Parties. In performing this Agreement, both the Corporation and Govind will
act in an individual capacity, and not as agents, representatives, employees, employers,
partners,joint-venturers, or associates of one another. The employees or agents of either party
may not be, nor be construed to be, the employees or agents of the other party for any purpose.
25. Captions. The captions in this Agreement are for convenience only and are not a part of
this Agreement. The captions do not in any way limit or amplify the terms and provisions of this
Agreement.
26. Severability.
a. If for any reason, any section, paragraph, subdivision, clause, provision, phrase or
word of this Agreement or the application of this Agreement to any person or
circumstance is, to any extent, held illegal, invalid, or unenforceable under present or
future law or by a final judgment of a court of competent jurisdiction, then the remainder
of this Agreement, or the application of the term or provision to persons or
circumstances other than those as to which it is held illegal, invalid, or unenforceable,
will not be affected by the law or judgment, for it is the definite intent of the parties to this
Agreement that every section, paragraph, subdivision, clause, provision, phrase, or word
of this Agreement be given full force and effect for its purpose.
b. To the extent that any clause or provision is held illegal, invalid, or unenforceable
under present or future law effective during the term of this Agreement, then the
remainder of this Agreement is not affected by the law, and in lieu of any illegal, invalid,
or unenforceable clause or provision, a clause or provision, as similar in terms to the
illegal, invalid, or unenforceable clause or provision as may be possible and be legal,
valid, and enforceable, will be added to this Agreement automatically.
27. Venue. Venue for any legal action related to this Agreement is in Nueces County, Texas.
28. Sole Agreement. This Agreement constitutes the sole Agreement between Corporation and
Govind. Any prior Agreements, promises, negotiations, or representations, verbal or otherwise,
not expressly stated in this Agreement, are of no force and effect.
29. Survival of terms of Agreement and obligations of parties. The terms of this Agreement and
the obligation of the parties relating to Section 14.a and b shall survive the termination of this
Agreement.
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Corpus Christi :r: ness & J•,. % - e ent Corporation
By:
Bart :Prselton
Date: President
A�I Pcove 4S 6 form,
Attest: ()4,41,\) g4),1
By:
Rebecca Huerta
Assistant Secretary
Govind Development, LLC
By: 41,141-----M44/kt40%-"--- / j� Oa( •
" v` I TNUKI�c►
Govind Nadkarni
ILLILPresident/CEO 3T COMM----
Date: 6//o / I i CteTAR
THE STATE OF TEXAS
COUNTY OF NUECES
This instrument was acknowledged before me on I,b , 2015, by Govind
Nadkarni, President/CEO, for Govind Development, LLC, behalf of the company
oXJD
Notary Public �`\ ELISSA M MOLINA
State of Texas ( �<I My Commission Expires
February 6,2019
OfRV
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