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12-19-2018 (WEDC) Agenda Packet TIC IF F TI 4 ylie Economic D eve lopment CORPORATION Special Meeting Agenda December 19, 2018 —7:00 A.M. WEDC Offices—Conference Room 250 South Highway 78 —Wylie, Texas Bryan Brokaw President Todd Wintters Vice President John Yeager .............................................. Secretary Demond Dawkins Treasurer Marvin Fuller Board Member Mayor Eric Hogue Ex-Officio Member Mindy Manson, City Manager Member Samuel Satterwhite Executive Director Jason Greiner Assistant Director Angel Wygant Senior Assistant In accordance with Section 551.042 of the Texas Government Code, this agenda has been posted at the Wylie Municipal Complex, distributed to the appropriate news media, and posted on the City Website: www,mtiefexas.gov within the required time frame. CALL TOO ' IER Announce the presence of a Quorum. INVOCATION & PLEDGE OF ALLEGIANCE CITIZEN PARTICIPATION Residents may address the WEDC Board regarding an item that is or is not listed on the agenda. Residents must provide their name and address. The WEDC Board requests that comments be limited to three (3) minutes. In addition, the WEDC Board is not allowed to converse, deliberate or take action on any matter presented during citizen participation. ACTION ITEMS I. Consider and act upon approval of the December 10, 2018 Minutes of the WEDC Board of Directors Meeting. II. (Remove from Table} Consider and act upon ratifying an Agreement of Purchase and Sale between the WEDC and Karan Associates, LLC for the acquisition of a 2.3866-acre tract of land situated in the Francisco De LA Pina Survey,Abstract No. 686,and the J. Truett Survey, Abstract No. 920, same being Lots 1-A-A and 1-A-B of City Lot 1-A, City of Wylie, Texas as shown on the Revised Map recorded in Volume 1002, Page 194, Deed Records, Collin County, Texas and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Agreement, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). WEDC—Agenda December 19, 2018 Page 2 of 2 III. Consider and act upon a First Amendment to Performance Agreement between the WEDC and Hooper-Woodbridge II, LLC. DISCUSSION ITEMS IV. December Sales Tax Report. V. Discussion of issues to be placed on future WEDC Board Meeting agenda (no substantial consideration/discussion allowed). EXECUTIVE SESSION Recess into Closed Session in compliance with Section 551.001, et.seq. Texas Government Code, to wit: Section 551.072 (Real Estate) of the Local Government Code, Vernon's Texas Code Annotated (Open Meetings Act). Consider the sale or acquisition of properties located at: • State Highway 78 & 5th Street • State Highway 78 & Ballard Section 551.087 (Economic Development) of the Local Government Code, Vernon's Texas Code Annotated(Open Meetings Act). Deliberation regarding commercial or financial information that the WEDC has received from a business prospect and to discuss the offer of incentives for: • Project 2018-1Ob ' CONVENE INTO OPEN MEETING Take any action as a result from Executive Session. ADJOU MENT CERTIFICATION 1 cert that this Notice of Meeting was posted on this 14th day of December 2018 at 5:00 p.m. as required by law in accordance with Section 551.042 of the Texas Government Code and that the appropriate news media was contacted. As a courtesy, this agenda is also posted on the City of Wylie website:wwwwylietexasggu. Stephanie Storm,City Secretary Date Notice Removed Minutes Wylie Economic Development Corporation Board of Directors Meeting Monday, December 10, 2018 —6:30 A.M. WEDC Offices—Conference Room 250 South Highway 78 —Wylie, Texas CALL TO ORDER Announce the presence of a Quorum President Bryan Brokaw called the meeting to order at 6:34 a.m. Board Members present were John Yeager, Marvin Fuller and Todd Wintters. Ex-officio members Mayor Eric Hogue and City Manager Mindy Manson were present. WEDC staff present was Executive Director Sam Satterwhite, Assistant Director Jason Greiner, and Senior Assistant Angel Wygant. INVOCATION & PLEDGE OF ALLEGIANCE Board Member Wintters gave an invocation and led the Pledge of Allegiance. President Bryan Brokaw recessed into Executive Session. EXECUTIVE SESSION Recess into Closed Session at 6:36 a.m. in compliance with Section 551.001, et. seq. Texas Government Code, to wit: Section 551.072 (Real Estate) of the Local Government Code, Vernon's Texas Code Annotated (Open Meetings Act). Consider the sale or acquisition of properties located at: • State Highway 78 & 5th Street • Birmingham& 78 Section 551.087 (Economic Development) of the Local Government Code, Vernon's Texas Code Annotated(Open Meetings Act). Deliberation regarding commercial or financial information that the WEDC has received from a business prospect and to discuss the offer of incentives for: • Project 2018-10b Mayor Hogue left the meeting at 7:08 a.m. City Manager Manson left the meeting at 7:14 a.m. RECONVENE INTO OPEN MEETING The WEDC Board of Directors reconvened into open session at 7:17 a.m. and moved to Citizen Participation. WEDC—Minutes December 10, 2018 Page 2 of 9 CITIZEN PARTICIPATION With no citizen participation, President Brokaw moved to Action Items. ACTION ITEMS ITEM NO. 1—Consider and act upon approval of the December 4,2018 Minutes of the Wylie Economic Development Corporation (WEDC) Board of Directors Meeting. MOTION: A motion was made by Marvin Fuller and seconded by John Yeager to approve the December 4,2018 Minutes of the Wylie Economic Development Corporation. The WEDC Board voted 4 —FOR and 0—AGAINST in favor of the motion. ITEM NO. 2 — Consider and act upon approval of the November 2018 WEDC Treasurers Report. Sales Tax receipts for the month of December had not yet been updated by the Comptroller's Office. Staff agreed to forward this report to the Board once the data has been released. MOTION: A motion was made by Todd Wintters and seconded by John Yeager to approve the November 2018 Treasurer's Report for the Wylie Economic Development Corporation. The WEDC Board voted 4 — FOR and 0 — AGAINST in favor of the motion. Prior to consideration of Items 3 and 4, Board Member Fuller indicated that McClure Partners had contacted Inwood National Bank regarding funding for these projects. Therefore, to avoid any potential conflict of interest,he would abstain from discussion of and voting on these items. Board Member Fuller left the meeting at 7:23 a.m. ITEM NO. 3 — Consider and act upon issues surrounding a Real Estate Sales Contract between the WEDC and the Rocking M,L.L.C. (McClure Partners). Staff reviewed a Real Estate Sales Contract between the WEDC and The Rocking M, LLC which is the legal entity created by the McClure family to own the proposed office building. The WEDC purchased the ±0.26-acre tract on Jackson Street from the McMillan family in 2017 for $89,500, which included $14,000 for the demolition of the family home which existed on the lot to complement its holdings on Jackson Street. The Contract identifies a 30-day due diligence period and a 7-day close with the Purchaser having the opportunity to extend the due diligence period for one, 30-day period. Under Article XI, should Purchaser fail to obtain a building permit from the City of Wylie for the contemplated office project by April 1, 2019. the WEDC shall have the right to repurchase the property back from the Purchaser for an amount equal to the purchase price. WEDC—Minutes December 10, 2018 Page 3 of 9 MOTION: A motion was made by Todd Wintters and seconded by John Yeager to approve a Real Estate Sales Contract between the WEDC and the Rocking M, LLC and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction. The WEDC Board voted 3 —FOR and 0—AGAINST in favor of the motion. ITEM NO.4—Consider and act upon issues surrounding a Performance Agreement between the WEDC and the Rocking M,L.L.C. (McClure Partners). Staff presented a Performance Agreement between the WEDC and The Rocking M, LLC. As an accompaniment to the previous Purchase and Sale Agreement, the WEDC is committing to fund an $89,500 reimbursement incentive should The Rocking M construct the contemplated office project as evidenced by the issuance of a building permit by April 1, 2019 and a certificate of occupancy issued by April 1, 2020. Company must also provide documentation supporting construction costs of not less than $300,000. MOTION: A motion was made by Todd Wintters and seconded by John Yeager to approve a Performance Agreement between the WEDC and the Rocking M, LLC and further authorize the WEDC Executive Director to execute the Agreement. The WEDC Board voted 3 —FOR and 0—AGAINST in favor of the motion. Board Member Fuller rejoined the meeting at 7:27 a.m. ITEM NO. 5 — Consider and act upon WEDC Resolution No. 2018-01 (R) approving a Project, a Loan from The American National Bank of Texas, the expenditure of funds, and enacting other provisions relating to the subject, further authorizing WEDC President Brokaw and Secretary Yeager to execute all documents relating to said Loan. Staff reviewed Resolution and Loan Documents authorizing the WEDC to borrow an amount not to exceed $4,500,000 from The American National Bank of Texas. The term of the loan is sixty (60) months at a 5.25% interest rate with a ten(10) year amortization. The first seven (7) months of the loan require interest only payments with the balance of the term being principal and interest payments. The loan is to be secured by a pledge of the Corporation's sales tax receipts as collateral for the debt. The Loan proceeds will be utilized to purchase several contiguous properties within the City of Wylie under separate closings as part of a master-planned redevelopment effort pursuant to Chapter 501 of the Texas Local Government Code, as amended. Staff has committed to make a public presentation to Council detailing project specifics within the next 45 days. On December 11, 2018 the Wylie City Council will be presented with a Resolution approving the attached WEDC Resolution authorizing the WEDC to enter into a Loan with The American National Bank in the amount of$4,500,000. While staff has been communicating project specifics with Council since July 2018, should the City Council not approve the Resolution,the WEDC will not be moving forward with multiple acquisitions. WEDC—Minutes December 10, 2018 Page 4 of 9 Board Member Wintters pointed out that the language in the loan documents requires 6 months interest only payments rather than 7. Staff will clarify with American National Bank whether the term is 6 or 7 months. Board Member Fuller inquired about the liquidity requirements and staff indicated that this requirement had been reviewed with ANB and the WEDC was in compliance. MOTION: A motion was made by John Yeager and seconded by Todd Wintters to approve Project, a Loan from The American National Bank of Texas in the amount of $4.5000,000, the expenditure of funds, and enacting other provisions relating to the subject, further authorizing WEDC President Brokaw and Secretary Yeager to execute all documents relating to said Loan. The WEDC Board voted 4—FOR and 0—AGAINST in favor of the motion. ITEM NO. 6—Consider and act upon authorizing the WEDC Executive Director to execute an Assignment of Contract for the purchase of property located in Collin County, Texas which is further described as Railroad Addition,Block 4,Lot 9 and Lot 10,Wylie,Texas and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Commercial Contract for Sale, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). As part of a WEDC property assemblage and master-planned redevelopment effort, and as contemplated and funded via WEDC Resolution No. 2018-01 (R), staff informed the Board that the WEDC plans to execute an assignment of Contract for the above referenced property under the below terms: Purchase price $145,000 Area 16,292 square feet Improvements No Due Diligence Expires 1-15-19 Closing 2-15-19 Staff anticipates having the contract assigned the week of December 10th and closing in January subject to receipt of a survey, issuance and evaluation of the title policy, and Wylie City Council approval of WEDC Resolution No. 2018-01 (R). MOTION: A motion was made by Marvin Fuller and seconded by Todd Wintters to authorize the WEDC Executive Director to execute an Assignment of Contract for the purchase of property located in Collin County, Texas which is further described as Railroad Addition, Block 4, Lot 9 and Lot 10, Wylie, Texas for the purchase price of $145,000 and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the WEDC—Minutes December 10, 2018 Page 5 of 9 transaction as prescribed within the terms of the Commercial Contract for Sale, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). The WEDC Board voted 4 —FOR and 0—AGAINST in favor of the motion. ITEM NO. 7—Consider and act upon authorizing the WEDC Executive Director to execute an Assignment of Contract for the purchase of property located in Collin County, Texas which is further described as Railroad Addition, Block 2, Lot 4b and Lot 5b, Wylie, Texas as otherwise known as the West one-half of Lots 4 and 5, Block 2 of Railroad Addition, and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Residential Contract, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). As part of a WEDC property assemblage and master-planned redevelopment effort, and as contemplated and funded via WEDC Resolution No. 2018-01 (R), staff informed the Board that the WEDC plans to execute an assignment of Contract for the above referenced property under the below terms: Purchase price $175,000 Area 8,146 square feet Improvements Yes—940 Square Feet SF Due Diligence Expires 11-20-18 Closing 1-7-19 Staff anticipates having the contract assigned the week of December 10th and closing on or before January 7, 2019, subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). MOTION: A motion was made by Marvin Fuller and seconded by Todd Wintters to authorize the Executive Director to execute an Assignment of Contract for the purchase of property located in Collin County, Texas which is further described as Railroad Addition, Block 2, Lot 4b and Lot 5b, Wylie, Texas as otherwise known as the West one-half of Lots 4 and 5, Block 2 of Railroad Addition, for the purchase price of$175,000, and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Residential Contract, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). The WEDC Board voted 4 — FOR and 0 — AGAINST in favor of the motion. ITEM NO. 8—Consider and act upon authorizing the WEDC Executive Director to execute a Residential Contract to purchase a portion of Lots 4 and 5, Block 2 of Railroad Addition to the City of Wylie, Collin County,Texas, according to the plat thereof recorded in Volume WEDC —Minutes December 10, 2018 Page 6 of 9 1,Page 11 of the Map Records,Collin County,Texas and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Agreement, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). As part of a WEDC property assemblage and master-planned redevelopment effort, and as contemplated and funded via WEDC Resolution No. 2018-01 (R), staff informed the Board that the WEDC plans to execute a Residential Contract for the above referenced property under the below terms: Purchase Price $204,388.38 Area 8,146 square feet Improvements Yes—680 Square Feet SF Due Diligence Expires 12-14-18 Closing 12-17-18 Staff anticipates having the contract executed on December 12th and closing on December 17th, subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). MOTION: A motion was made by John Yeager and seconded by Todd Wintters to authorize the Executive Director to execute a Residential Contract to purchase a portion of Lots 4 and 5, Block 2 of Railroad Addition to the City of Wylie, Collin County, Texas, according to the plat thereof recorded in Volume 1, Page 11 of the Map Records, Collin County, Texas, for the purchase price of $204,388.38, and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Contract, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). The WEDC Board voted 4 — FOR and 0 — AGAINST in favor of the motion. ITEM NO. 9—Consider and act upon ratifying an Agreement of Purchase and Sale between the WEDC and Karan Associates, LLC for the acquisition of a 2.3866-acre tract of land situated in the Francisco De LA Pina Survey, Abstract No. 686, and the J. Truett Survey, Abstract No. 920, same being Lots 1-A-A and 1-A-B of City Lot 1-A, City of Wylie,Texas as shown on the Revised Map recorded in Volume 1002, Page 194, Deed Records, Collin County,Texas and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Agreement, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). As part of a WEDC property assemblage and master-planned redevelopment effort, and as contemplated and funded via WEDC Resolution No. 2018-01 (R), staff recommended that the WEDC—Minutes December 10, 2018 Page 7 of 9 WEDC Board to ratify an Agreement of Purchase and Sale for the above referenced property under the below terms: Purchase Price $1,250,000 Area 2.3866 acres Improvements Yes—24,000 Square Feet Due Diligence Expires 12-19-18 Closing 12-28-18 Staff is awaiting confirmation from an environmental consultant which is evaluating internal contaminants (asbestos) within the structure and a separate consultant evaluating soil samples. Due dates for those results are 12-8-18 and 12-14-18 respectively. As well, staff anticipates that the existing structure will be demolished at an estimated cost of $100,000. Again, all recommendations are subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). MOTION: A motion was made by John Yeager and seconded by Marvin Fuller to Table this item until the next available meeting of the WEDC Board of Directors. The WEDC Board voted 4—FOR and 0—AGAINST in favor of the motion. ITEM NO. 10—Consider and act upon authorizing the WEDC Executive Director to execute an Assignment of Contract for the purchase of a tract of land situated in the J.Truitt Survey, Abstract No. 920 and the F. De La Pina Survey, Abstract No. 688, City of Wylie, Collin County,Texas and being all and part of City Lot 1-C,the City of Wylie,Collin County,Texas according to the plat thereof recorded in Volume 1002, Page 194, Deed Records, Collin County, Texas, and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Residential Contract, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). As part of a WEDC property assemblage and master-planned redevelopment effort, and as contemplated and funded via WEDC Resolution No. 2018-01 (R), staff asked the WEDC Board to ratify an Agreement of Purchase and Sale for the above referenced property under the below terms: Purchase Price $6.84 psf Area 2.13 - 2.599 acres Improvements Yes—3,704 Square Feet Due Diligence Expires 12-19-18 WEDC—Minutes December 10, 2018 Page 8 of 9 Closing 2-2-19 WEDC Counsel Randy Hullett is still evaluating abandoned City right-of-way impacting the property which will determine whether the WEDC is purchasing approximately 2.13 acres or approximately 2.599 acres. Should the final area be 2.13 acres, the contract has a floor of $715,000. Should the area be 2.599 acres the purchase price will revert to $6.84 per square foot or $774,486.40. Staff anticipates Mr. Hullett's final evaluation/discussions with the Title Company will be on or about December 14th. Staff is also evaluating data recently received from WEDC environmental consultants which may require a renegotiated purchase price to offset potential enrollment in the TCEQ Voluntary Cleanup Program. While there are still several 'open' issues,staff requested approval of the assignment of the contract in order to close under the worst-case scenario of accepting the property as-is and a maximum purchase price of$774,486.40. Should the Board require more input pertaining the outcome of the City right-of-way and environmental impacts, this item can be tabled, and staff can post a Board Meeting for December 19th prior to the expiration of the due diligence period. Again, all action subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). Board Member Wintters clarified that the price range being approved was based on the outcome of the right-of-way property. Staff confirmed that was the case. MOTION: A motion was made by Todd Wintters and seconded by John Yeager to authorizing the WEDC Executive Director to execute an Assignment of Contract for the purchase of a tract of land situated in the J. Truitt Survey, Abstract No. 920 and the F. De La Pina Survey, Abstract No. 688, City of Wylie, Collin County, Texas and being all and part of City Lot 1-C, the City of Wylie, Collin County, Texas according to the plat thereof recorded in Volume 1002, Page 194, Deed Records, Collin County, Texas, for the purchase price of no less than $715,000 and no more than $774,486.40, and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Contract, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). The WEDC Board voted 4—FOR and 0 —AGAINST in favor of the motion. Mayor Hogue returned at 7:52 a.m. DISCUSSION ITEMS ITEM NO. 11 - Staff report: review issues surrounding WEDC Performance Agreement Summary, Hotel Occupancy Tax, Environmental Activity Summary, Active Project Summary, and Regional Housing Starts. Staff updated the Board on WEDC projects and activities noting that year-over-year sales tax receipts for the Woodbridge Crossing shopping center decreased 3.88% and Woodbridge Centre WEDC—Minutes December 10, 2018 Page 9 of 9 experienced only a 6% increase over the same time period. Housing starts remained strong with thirty-four new homes permitted in Wylie. With the addition of a second hotel,Hotel Occupancy Tax receipts to the City of Wylie rose 114% and 177%respectively for the months of August and September over last year's receipts. ITEM NO. 12—Discussion of issues to be placed on a future WEDC Board Meeting agenda (no substantial consideration/discussion allowed). No Board Member requested any items to be placed on future Agendas. ADJOURNMENT With no further business, President Brokaw adjourned the WEDC Board meeting at 7:57 a.m. Bryan Brokaw,President ATTEST: Samuel Satterwhite,Director ylie cono ic I evelop ent Corporation ENID - A DU TO: WEDC Board of Directors FROM: Samuel Satterwhite, Executive SUBJECT: Real Estate Transaction DATE: December 12, 2018 Issue {Remove from Table} Consider and act upon ratifying an Agreement of Purchase and Sale between the WEDC and Karan Associates, LLC for the acquisition of a 2.3866-acre tract of land situated in the Francisco De LA Pina Survey, Abstract No. 686, and the J. Truett Survey,Abstract No. 920, same being Lots 1-A-A and 1-A-B of City Lot 1-A, City of Wylie, Texas as shown on the Revised Map recorded in Volume 1002, Page 194, Deed Records, Collin County, Texas and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Agreement, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). Analysis As part of a WEDC property assemblage and master-planned redevelopment effort, and as contemplated and funded via WEDC Resolution No. 2018-01 (R), the WEDC will be ratifying an Agreement of Purchase and Sale for the above referenced property under the below terms: Purchase Price $1,250,000 Area 2.3866 acres Improvements Yes—24,000 Square Feet Due Diligence Expires 12-19-18 Closing 12-28-18 With Council approve the WEDC debt, the only outstanding issue is negotiating for the increased asbestos remediation costs which staff will be working on right up to the Meeting on the 19th. WEDC—Real Estate December 12, 2018 Page 2 of 2 Recommendation Based upon further negotiations with Karan Associates, LLC, staff will be making a recommendation surrounding the ratification of an Agreement of Purchase and Sale between the WEDC and Karan Associates,LLC for the acquisition of a 2.3866-acre tract of land situated in the Francisco De LA Pina Survey, Abstract No. 686, and the J. Truett Survey, Abstract No. 920, same being Lots 1-A-A and 1-A-B of City Lot 1-A, City of Wylie, Texas as shown on the Revised Map recorded in Volume 1002,Page 194,Deed Records,Collin County,Texas,for the current purchase price of$1,250,000 and further authorize WEDC President Brokaw to execute all documentation necessary to effectuate the transaction as prescribed within the terms of the Agreement, all subject to Wylie City Council approval of WEDC Resolution No. 2018-01 (R). ylie Econo ic I evelo a ent Corporation E 0 - A DU TO: WEDC Board of Directors FROM: Samuel Satterwhite, Executive Director. SUBJECT: Hooper-Woodbridge II, LLC—First Amendment DATE: December 19, 2018 Issue Consider and act upon approval of a First Amendment to the Performance Agreement between Hooper-Woodbridge II, LLC and the WEDC. Analysis On April 18, 2018, the WEDC entered into a Performance Agreement with Hooper-Woodbridge II, LLC to provide assistance with the development of qualified infrastructure in the amount of $20,000. To qualify for assistance, Mr. Lanman was to obtain a Building Permit and Certificate of Occupancy (CO) for a 5,500 square foot medical office building located at 505 Woodbridge Parkway with a project cost of $750,000 and qualified infrastructure at a minimum cost of $20,000. Staff recently recognized that the intent of the Agreement does not match the required Performance Measures. Hooper-Woodbridge intended to have the building partially leased at a minimum with a Certificate of Completion in place for the balance of the property. As indicated above, a CO is required for the entire building. A lease is in place for 3,200 square feet and the balance is being marketed for medical uses. The intent identified above was to get the qualified infrastructure (extensions of utilities) in place first and foremost. Staff is recommending the Amendment below to clarify the contradictory language. The attached First Amendment to Performance Agreement amends Incentive No. 1 as follows: Incentive No. 1 ...... ...... $20,000.00 A Proof of Building Permit for 5,500 SF by June 1, 2018 A Proof of Certificate of Completion for 5,500 SF by February 28, 2019 A Proof of Certificate of Occupancy for 3,200 SF by February 28, 2019 A Proof of$750,000 Minimum Construction Cost A Proof of$20,000 Minimum Qualified Infrastructure Cost A Ad valorem property taxes current. WEDC—Hooper-Woodbridge II, LLC December 19, 2018 Page 2 of 2 Recommendation Staff recommends that the WEDC Board of Directors approve the attached First Amendment to Performance Agreement between Hooper-Woodbridge II, LLC and the WEDC. Attachments First Amendment Performance Agreement FIRST AMENDMENT TO PERFORMANCE AGREEMENT THIS FIRST AMENDMENT TO PERFO' CE AGREEMENT (this "First Amendment"), is entered into and is effective as of the day of 2018 by and between WYLIE ECONOMIC DEVELOPMENT CORPORATION, a Texas economic development corporation ("WEDC"), and Hooper-Woodbridge II, LLC, a Texas limited liability company(the "Company"). WITNESSETH: WHEREAS, WEDC Board of Directors approved that certain Performance Agreement between WEDC and Company on April 18, 2018 to facilitate the development of a 5,500 square foot medical office building (the "Project"); and WHEREAS. WEDC and Company desire to modify and amend the Agreement in certain respects, as more particularly set forth in this First Amendment. NOW, THEREFORE, in an effort to address unforeseen circumstances surrounding the development of qualified infrastructure, the WEDC and Company covenant and agree as follows: 1. Defined Terms. Capitalized terms used but not defined in this First Amendment will have the meanings given to them in the Agreement. 2. Modification to Performance Obligations. Notwithstanding anything to the contrary in the Agreement, the Criteria to Qualify for Economic Assistance is amended in Section 2a as follows: Requirements for Reimbursement Incentive. a. Incentive No. la: An Economic Development Incentive of Twenty Thousand Dollars ($20,000) will be paid to Company upon completion of the following Performance Requirements for Incentive No. la: 1) Receipt of documentation by WEDC of a Building Permit for no less than a five thousand five hundred (5,500) square foot medical office building issued by the City of Wylie no later than June 1, 2018, approval of said documentation at the sole and absolute discretion of the WEDC; and 2) Receipt of documentation by WEDC of a Certificate of Completion for no less than a five thousand five hundred (5,500) square foot medical office building issued by the City of Wylie no later than February 28, 2019, approval of said documentation at the sole and absolute discretion of the WEDC; and 3) Receipt of documentation by WEDC of a Certificate of Occupancy for no less than a three thousand two hundred (3,200) square foot medical office space issued by the City of Wylie no later than February 28, 2019, approval of said documentation at the sole and absolute discretion of the WEDC; and 4) Receipt of documentation by WEDC supporting a minimum project cost of the Seven Hundred Fifty Thousand Dollars($750,000)as evidenced by paid invoices supporting the minimum cost, approval of said documentation at the sole and absolute discretion of the WEDC; and 5) Receipt of documentation by WEDC supporting a minimum cost of Twenty Thousand Dollars ($20,000)for the construction of Qualified Infrastructure (more specifically improvements to water, sewer, & storm sewer utilities); and 6) Company is current on all ad valorem taxes and other property taxes due on the Facility by January 31 of the year after they are assessed and provide written notice and evidence of such payment to WEDC in a form satisfactory to WEDC; and 7) Eligibility expiration for the Company to qualify for this Incentive No. la is February 28, 2019, 3, Ratification. As expressly modified by this First Amendment, the Agreement is hereby ratified and confirmed by WEDC and Company. 4. Counterparts: Transmission. This First Amendment ma be be executed in multiple counterparts, each of which shall be deemed an original, and all of which shall constitute one and the same agreement. Transmission of an executed signature page of this First Amendment by email will be effective to create a binding agreement. [Signatures appear on next page] IN WITNESS REOF,the parties hereto have executed this First endment the day and year first above written. WEDC: Wylie Economic Development Corporation, a Texas Corporation By. Name: Tit]e: COMPANY' Hooper-Woodbridge II,LLC,a Texas limited liability company ("Company"). Name: Tide:• PERFO ' ANCE AG' EMENT Between WYLIE ECONOMIC DEVELOPMENT CORPORATION And HOOPER-WOODB " I GE II, LLC This Performance Agreement (this "Agreement") is made and entered into by and between the Wylie Economic Development Corporation (the "WEDC"), a Texas corporation organized and existing under the Development Corporation Act of 1979, as amended from time to time (the "Act"), and Hooper-Woodbridge H, LLC, a Texas limited liability company (the "Company"). RECITALS WHE' AS, the Company is desirous of making real and personal property improvements in the form of a 5,500 square foot medical office building (the "Project"). The project will have an estimated project cost of Seven Hundred Fifty Thousand Dollars ($750,000) and will be located on Lot 2, Block A of the Lanman Addition, generally located at 501 Woodbridge Parkway in Wylie, Texas (the"Facility"); and WHEREAS, the Company has requested that the WEDC provide economic assistance to facilitate the construction of the Facility and the related improvements by providing cost reimbursement for the proposed improvements (the"Improvements"); and WHEREAS, the WEDC has determined that it is in the best interest of the public and the City and promotes the purposes authorized by the voters of the City of Wylie for which the WEDC was established to encourage the development and use of business properties within the City; and WHE' AS, for the public purpose of promoting economic development and diversity, increasing employment, reducing unemployment and underemployment, expanding commerce and stimulating business and commercial activities in the State of Texas, and the City of Wylie, the WEDC desires to offer economic assistance to Company as more particularly described in this Agreement. NOW, THE ' FO ' , for and in consideration of the promises, covenants and agreements set forth herein, the receipt and sufficiency of which are hereby acknowledged, the WEDC and Company agree as follows: I. Economic Assistance. Subject to the terms of this Agreement, the WEDC will provide the Company economic assistance in an amount up to, but not to exceed Twenty Thousand Dollars ($20,000.00) (the "Economic Development Incentives"), The Economic Incentives will be paid per the criteria set forth herein with the WEDC's obligation to pay the Economic Development Incentives terminating on February 28, 2019. Upon meeting the qualifications and requirements (the "Performance Requirements"), the Company shall be entitled to the following Economic Development Incentives: Page 1 of 5 518822-1 Economic Development Incentive Payment Schedule, Expected Cost of WEDC Cumulative Eligibility Year Incentive Improvements Incentive Incentive Expiration 2019 No. 1 $750,000 $20,000 $20,000 2/28/19 II. Reouirements for Reimbursement Incentive. a. Incentive No. la: An Economic Development Incentive of Twenty Thousand Dollars ($20,000) will be paid to Company upon completion of the following Performance Requirements for Incentive No. la 1) Receipt of documentation by WEDC of a Building Permit for no less than a five thousand five hundred (5,500) square foot medical office building issued by the City of Wylie no later than June 1, 2018, approval of said documentation at the sole and absolute discretion of the WEDC; and 2) Receipt of documentation by WEDC of a Certificate of Occupancy for no less than a five thousand five hundred (5,500) square foot medical office building issued by the City of Wylie no later than February 28, 2019, approval of said documentation at the sole and absolute discretion of the WEDC; and 3) Receipt of documentation by WEDC supporting a minimum project cost of the Seven Hundred Fifty Thousand Dollars ($750,000) as evidenced by paid invoices supporting the minimum cost, approval of said documentation at the sole and absolute discretion of the WEDC; and 4) Receipt of documentation by WEDC supporting a minimum cost of Twenty Thousand Dollars ($20,000) for the construction of Qualified Infrastructure (more specifically improvements to water, sewer, & storm sewer utilities); and 5) Company is current on all ad valorem taxes and other property taxes due on the Facility by January 31 of the year after they are assessed and provide written notice and evidence of such payment to WEDC in a form satisfactory to WEDC; and 6) Eligibility expiration for the Company to qualify for this Incentive No, la is February 28, 2019. III. WEDC Payment of Reimbursement Incentives. Supporting documents must be submitted to the WEDC not more than thirty (30) days from the eligibility expiration. Subject to the terms of this Agreement, the WEDC shall pay the Reimbursement Incentives within approximately forty-five (45) days of receipt of the required documentation from the Company, subject to verification by the WEDC that the Performance Requirements have been met by the Company. Page 2 of 5 W.\Board\2018\448-1 8\HOOPER-WOODBRIDGE II-Po-1, ti.0100 Agreement DOC IV Non-Attainment of Performance Requirements. In the event that the Company does not meet or exceed a Performance Requirement as specified in Section II, the WEDC Economic Development Incentive will be voided in advance of payment in addition to all future Economic Development Incentive payments being voided at the sole discretion of the WEDC. The Company will not be eligible to receive an Economic Development Incentive payment if documentation supporting Performance Requirements are not received by WEDC prior to the Eligibility Expiration Date. Company will be notified in writing in the event a Performance Requirement is not met and have thirty (30) days to cure said default. V Economic Assistance Termination. The Agreement may be terminated by mutual agreement of the parties or by either party, upon the failure of the other party to fulfill an obligation as set forth in Section II above. Regardless of the Company's level of attainment of the Performance Requirements set forth in Section II above, the WEDC's obligation to pay a portion or all of the Reimbursement Incentive will expire in full on February 28, 2019, VI. Employee Hiring, Materials and Supplies Purchase. Although not an event of default or a condition to any advance in the Agreement, WEDC requests that the Company satisfy its need for all additional employees from Wylie residents and purchase all materials, supplies and services necessary to affect the renovations and subsequent occupancy of the leased office space from Wylie merchants and businesses. VII. Community Involvement. Although not an event of default or condition of any advance hereunder, the Company agrees to actively participate in community and charitable organizations and/or activities, the purpose of which are to improve the quality of life in the City of Wylie, Texas, and to actively encourage its City of Wylie employees to be involved in such organizations and/or activities. VIII. Verification and C:ompliance. The Company will allow the WEDC to audit necessary Company's records, documents, agreements and other instruments in furtherance of the following purposes: (i) to ensure the Company's compliance with the affirmative covenants set forth in this Agreement; (ii) to determine the existence of an Event of Default under the terms of this Agreement; (iii) to ensure compliance with any other terms and conditions set forth herein or any related documents. IX. Cessation of Economic Assistance. Notwithstanding anything herein to the contrary, WEDC shall have no obligation to disburse WEDC Economic Incentives if the Company becomes insolvent, files a petition in bankruptcy or similar proceedings, or is adjudged bankrupt, is delinquent on any property tax payments, or an Event of Default under the terms of this Agreement occurs. X. Non-Payment of Economic Assistance. The following will constitute an Event of Default: the Company becomes insolvent, makes any materially false statements to the City and/or the WEDC, fails to pay ad valorem taxes, any event of bankruptcy, or files suit against the City and/or the WEDC. Page 3 of 5 W:\Boardk201 8\4-18-181-100PER-WOODBR1DGE II-Performance Agreement DOC XI. Miscellaneous, a. This Agreement shall inure to the benefit of the parties hereto and shall not be assignable by Company without the prior written consent of the WEDC, which consent may be withheld by the WEDC in its sole and absolute discretion. b. This Agreement shall be construed according to the laws of the State of Texas and is subject to all provisions of Vernon's Ann. Civ. St. Art. 5190,6, which are incorporated herein by reference for all purposes. In the event any provision of the Agreement is in conflict with article 5190.6, article 5190.6 shall prevail. c. This Agreement contains the entire agreement of the parties regarding the within subject matter and may only be amended or revoked by the written agreement executed by all of the parties hereto. d. This Agreement shall be governed by the laws of the State of Texas and is specifically performable in Collin County, Texas. e. Any notice required or permitted to be given under this agreement shall be deemed delivered by depositing the same in the United States mail, certified with return receipt requested, postage prepaid, addressed to the appropriate party at the following addresses, or at such other address as any part hereto might specify in writing: WEDC: Samuel D. R. Satterwhite Executive Director Wylie Economic Development Corporation 108-C W. Marble Wylie, Texas 75098 With copy to. Abernathy, Roeder, Boyd and Joplin, P.C. 1700 Redbud Blvd., Suite 300 McKinney, Texas 75069 Attention: Mr. G. Randal Hullett COMPANY: HOOPER-WOODB* I GE II, LLC Attn: Aaron J. Lanman, Managing Member IA/ 1-1-9 N.-DAL.d / Pgpef.:1 Wylie, TX 75098 With copy to: Page 4 of 5 W:\Board\2018 4-18-18\HOOPER-WOODBRIDGE II-Performance Agreement.DOC By the execution hereof, each signatory hereto represents and affirms that he is acting on behalf of the party indicated, that such party has taken all action necessary to authorize the execution and delivery of the Agreement and that the same is a binding obligation on such party. EXECUTED this I f;day of April, 2018. WEDC: WYLIE, ECONOMIC DEVELOPMENT CORPORATION Samuel D. R. Satterwhite, Executive erector COMPANY: HOOPER-WOODB ID GE II,LLC, a Texas limited liability company By: Aaron J I. , Managing Member Page 5 of 5 WABoard\20 1 8\4-1 8-1 811-100PER-WOOD BR TDCi F.II-Performance Agreement DOC 1NYLIE ECONOMIC DEVELOPMENT CORPORATION SALES TAX REVENUE FOR THE MONTH OF DECEMBER 2018 MONTH WEDC WEDC WEDC DIFF % DIFF 2017 2018 2019 18 VS 19 18 VS 19 DECEMBER $197,808 $184,849 $214,867 $30,019 15.18% JANUARY 196,347 191,896 FEBRUARY 276,698 275,668 MARCH 191,648 182,852 APRIL 168,844 163,485 MAY 244,816 203,707 JUNE 191,732 199,412 JULY 223,571 213,977 AUGUST 261,573 249,590 SEPTEMBER 210,974 213,426 OCTOBER 195,549 210,702 NOVEMBER 267,816 273,197 Sub-Total $2,627,376 $2,562,759 $214,867 $30,019 15.18% AUDIT ADJ TOTAL $2,627,376 $2,562,759 $214,867 $30,019 15.18% WEDC SALES TAX ANALYSIS $300,000 :.- „, �..,, Q ... ....m. . ... _m ....,. $250,000 .. _ m; $150,000 _ $100,000 ®' _. $0 1;. p k F E s . { S s t 1 -- 0 ' - E > 2 m Q rn E 0 E n Q a) 0 in z • ylie cono is I evelop ent Car, oration iE 0 - ANDU TO: WEDC Board of Directors FROM: Sam Satterwhite, Executive Director SUBJECT: Future Agenda Items DATE: December 11, 2018 Issue Discussion of issues to be placed on future WEDC Board Meeting agenda (no substantial consideration/discussion allowed). Analysis During this Discussion Item, Board Members will have the opportunity to propose that an issue be placed on a future agenda for consideration. The Board will note that no substantial consideration/discussion is allowed so that there will not be a violation of the Open Meetings Act which requires discussion/action items be placed on Agenda's with specific language as to what will be discussed. For example, the above language will allow a Board Member to present a request for a certain item to be placed on an agenda for consideration, but not the ability for the same Board Member to argue the merits of the issue. Conversely, another Board Member may not discuss the merits as to why they may not want that particular item on a future agenda. Recommendation This Item is for discussion only and will provide direction to Staff No formal action is allowed.