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City (W Hayt,("-w"rm H-w 1 210, day of 2010.
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Exhibit "A"
CITY OF BAYTOWN / GANTSTEIN ESQUIRE LLC
CHAPTER 380
ECONOMIC DEVELOPMENT AGREEMENT
STATE OF TEXAS §
COUNTY OF HARRIS §
This Chapter 380 Economic Development Agreement ( "Agreement ") is made and entered
into by and between GANTSTEIN ESQUIRE, LLC, a Texas limited liability company, its
successors and assigns ( "GANTSTEIN ") and the CITY OF BAYTOWN, TEXAS, a home rule
city and municipal corporation ( "CITY ").
RECITALS
WHEREAS, as part of the Project, the CITY seeks to induce GANTSTEIN to create at
least sixty (60) new jobs in connection with the Project and the operations of GANTSTEIN in
the corporate limits of Baytown, Texas, which jobs will promote state and local economic
development and stimulate business and commercial activity within the corporate limits of
Baytown; and
WHEREAS, as part of the Project, the CITY seeks to induce GANTSTEIN to invest at
least $800,000 by December 31, 2010, in real property improvements located at 4555 Garth
Road for the development of a Food Court Facility featuring regional and national tenants. as
hercinbelow described, and to increase the taxable value of such property to at least $1 million
by December 31, 2010; and
NOW, THEREFORE, in consideration of the mutual benefits and promises and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the CITY and GANTSTEIN agree as follows:
1.
Authority
1.01 CITY. The CITYSs execution of this Agreement is authorized by Chapter 380 of the
Texas Local Government Code and constitutes a valid and binding obligation of the
CITY.
1.02 GANTSTEIN. GANTSTEIN'S execution and performance of this Agreement constitutes
a valid and binding obligation o1' GANTSTEIN. The CITY acknowledges that
GANTSTEIN is acting in reliance upon the CITY'S performance of its obligations under
this Agreement in making its decision to invest its funds and expand employment in
Baytown.
Chanter 380 EtiMMig lkyelopment Agreement. Page I
11.
Definitions
2.01 "Food Court Facility": A building or buildings containing food storage, preparation,
service and dining facilities with tenants operating under the trade names of Freebirds
and Jason's Deli or equal or superior restaurateurs as determined by the CITY at the
location described as follows:
4555 Garth Road
Baytown, TX 77521
2.02 "E=ffective Date" is August 12, 2010.
2.03 "Job(s)" means full -time and part -time jobs performed at the Food Court Facility by
employees of Freebirds and Jason's Deli or equal or superior restaurateurs as determined
by the CITY, and created as the result of the construction and the operation of the Project
by GANTSTEIN.
2.04 "Program" means the economic development program for this Project established by the
CITY pursuant to Texas Local Government Code Chapter 380 to promote local economic
development and stimulate business and commercial activity within the CITY.
2.05 "FICAD" means the Harris County Appraisal District or its successor.
2.06 "Lease Term" shall mean the terms of the GANTSTEIN's leases with Freebirds and
Jason's Deli, which shall be at a minimum of 6 years.
III.
GANTSTEIN Obligations
3.01 Creation of Jobs. Between the effective date of this Agreement and December 31, 2010,
GANTSTEIN through its tenants Freebirds and Jason's Deli will create at least 60 new
Jobs and maintain those throughout the Lease Terms. In the event of a voluntary or
involuntary termination or elimination of a Job after December 3 1. 2410, that causes the
number of people employed in Jobs to fall below 60, GANTSTEIN shall continue to
receive the incentives set out in Section 4.01 below, provided the required number of
people employed in said Jobs is re- established within one hundred twenty (120) days
after the date of the termination or elimination that caused the number of people
employed in Jobs to fall below 60.
3.02 Creation of Taxable Value. Between the effective date of this Agreement and December
31, 2010, or such other date as approved in writing by the City Manager, GANTSTEIN
Chapter 380 Economic IkNelopmcnt Aerremcnt_ Page 2
shall invest at least $800,000 for the expansion and build -out of an existing space of
7,500 square feet to a space of 8,500 square feet for use as the Food Court Facility and
shall increase the value of the property so that the same has a taxable value of at least $1
million on January 1, 2011, as assessed by HCAD. The property must maintain a taxable
value of at least $1 million throughout the Lease Terms.
3.03 Certificate of Compliance and lnspection.
(a) GANTSTEIN shall annually deliver to the CITY a Certificate of Compliance, at
the time that GANTSTEIN delivers to the CITY the annual Property Tax Notice
required under Section 4.01 below, utilizing the form attached as Exhibit A. The
form is subject to revision by the CITY in its sole discretion.
(b) In the Certificate of Compliance, GANTS "FEIN shall warrant to the CITY
whether it is in full compliance with each of its obligations under this Agreement,
including the number of new Jobs maintained by GANTSTEIN's tenants
Freebirds and Jason's Deli for the preceding year pursuant to Section 3.01 above.
(c) The CITY, and/or its representative(s), has the right to inspect only such pertinent
records of GANTSTEIN and its tenants Frcebirds and Jason's Deli as are
reasonably necessary to verify compliance with all requirements of this
Agreement. Inspections shall be preceded by at least two week's notice in writing
to GANTSTEIN. GANTSTEIN shall make copies of the pertinent records of its
tenants Freebirds and Jason's Deli available to the CITY at the Restaurant Facility
or deliver them directly to the City.
3.04 Failure to Meet Obligations. In the event that GANTSTEIN fails to fulfill its obligations
under the performance guidelines contained in this Article III, after receipt of notice and
expiration of the cure period described in Section 5.03 below, the CITY may, at its
option, terminate this Agreement. whereupon GANTSTEIN shall be required to
reimburse the CITY within 30 days for payments made by the CITY pursuant to this
Agreement in accordance with the following:
Year of Non-Compliance
2010 -- 2011
11crevulage 14) he Reiniburscd
100%
2012
80%
2013
60%
2014
40%
2015
20%
IV.
CITY Obligations
4.01 Economic Development Incentive. As consideration for GANTSTEIN's performance of
its obligations under this Agreement and as the CITY'S sole obligation under this
Chapter 3801?connmic Do-cinpment Artccmcnl. Page 3
Agreement, the CITY, upon proof of GANTSTEIN'S compliance with its obligations
under this Agreement, will reimburse during the first four years of this Agreement
GANTSTEIN a portion of the real property ad valorem which it pays to the City on the
Food Court Facility based upon the following formula:
(TAXABLE VALUE OF FOOD COURT FACILITY- $733,000) X (CITY'S AD
VALOREM TAX RATE)
If the product of the above - referenced equation yields a negative number, the CITY shall
not be obligated to pay GANTSTEIN any monies under this Agreement and the CITY
may terminate this agreement for GANTSTEIN's failure to comply with Article III
hereof. Reimbursements shall be made within thirty (30) days after the CITY's receipt of
a reimbursement request, proof of payment, and proof of compliance with Article III.
4.02 Indebtedness to the CITY. If GANTSTEIN, at any time during the term of this
agreement, incurs a debt, as the word is defined in section 2 -662 of the Code of
Ordinances of the City of Baytown, it shall immediately notify the CITY'S Director of
Finance in writing. If the CITY'S Director of Finance becomes aware that GANTSTEIN
has incurred a debt, the CITY'S Director of Finance shall immediately notify
GANTSTEIN in writing. If GANTSTEIN does not pay the debt within 30 days of either
such notification, the CITY'S Director of Finance may deduct funds in an amount equal
to the debt from any payments owed to GANTSTEIN under this Agreement, and
GANTSTEIN waives any recourse therefor.
V.
General Terms
5.01 Term. This Agreement shall become enforceable upon execution by the City Manager of
the CITY and shall be effective on the Effective Date. Unless terminated earlier in
accordance with its terms, this Agreement shall terminate December 31, 2017, If an
extension is granted by the City Manager pursuant to Section 3.02, such extension shall
also extend the term of this agreement so that the GANTSTEIN'S obligations specified
herein are effective for a period of six years.
5.02 Default. If either the CITY or GANTSTEIN should default in the performance of any
obligations of this Agreement, the other party shall provide such defaulting party written
notice of the default, and a minimum period of sixty (60) days after the receipt of said
notice to cure such default, prior to instituting an action for breach or pursuing any other
remedy for default.
5.03 Termination. In the event GANTSTEIN elects not to proceed or continue with with the
Project as contemplated by this Agreement, GANTSTEIN shall notify the CITY in
writing, and this Agreement and the obligations on the part of both parties shall be
deemed terminated and of no further force or effect. If so terminated, GANTSTEIN shall
be required to reimburse the CITY for all monies paid pursuant to Section 4.01
hereinabove prior to the termination being effective.
Chaplet 380 Economic tkcelo m nl Agrg mcnt. Page 4
5.04 Mutual Assistance. CITY and GANTSTEIN will do the things commercially reasonable,
necessary or appropriate to carry out the terns and provisions of this Agreement, and to
aid and assist each other in carrying out such terms and provisions in order to put each
other in the same economic condition contemplated by this Agreement regardless of
changes in public policy, the law or taxes or assessments attributable to GANTSTEIN
facilities.
5.05 Entire Agreement. This Agreement contains the entire agreement between the parties. All
prior negotiations, discussions, correspondence, and preliminary understandings between
the parties and others relating hereto are superseded by this Agreement. This Agreement
may only be amended, altered or revoked by written instrument signed by the CITY and
GANTSTEIN.
5.06 Binding Effect. ffect. This Agreement shall be binding on and inure to the benefit of the parties
and their respective successors and assigns.
5.07 Assianment. Except as provided below, GANTSTEIN may not assign all or part of its
rights and obligations to a third party without prior written approval of the CITY, which
approval shall not be unreasonably withheld or delayed. Notwithstanding anything to the
contrary, GANTSTEIN may assign all or part of its rights and obligations without the
prior consent of the CITY to an affiliate of GANTSTEIN and to a third party lender
advancing funds for the acquisition, construction or operation of Restaurant Facilities.
5.08 Release. By this Agreement, the CITY does not consent to litigation or suit, and the
CITY hereby expressly revokes any consent to litigation that it may have granted by the
terms of this Agreement or any other contract or agreement, any charter, or applicable
state law. Nothing contained herein shall be construed in any way so as to waive in
whole or part the CITY's sovereign immunity. GANTSTEIN assumes full responsibility
for its obligations under this Agreement performed hereunder and hereby releases,
relinquishes, discharges, and holds harmless the CITY, its officers, agents, and
employees from all claims, demands, and causes of action of every kind and character
that is caused by or alleged to be caused by, arising out of, or in connection with
GANTSTEIN'S obligations hereunder. This release shall apply with respect to
GANTSTEIN'S work regardless of whether said claims, demands, and causes of action
are covered in whole or in part by insurance.
5.09 Notice. Any notice and /or statement required or permitted to be delivered shall be
deemed delivered by actual delivery, by facsimile, with receipt of confirmation, or 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:
GANTSTEIN:
Gantstein Esquire, LLC
333 Freeport St.
Houston, TX 77015-23 10
ChaDlur 380 Page 5
CITY:
City of Baytown
P.O. Box 424
Baytown, TX 77522
FAX: 281- 420 -6586
Attn: City Manager
Either party may designate a different address at any time upon written notice to the other
party.
5.10 Interpretation. Each of the parties has been represented by counsel of their choosing in
the negotiation and preparation of this Agreement. Regardless of which party prepared
the initial draft of this Agreement, this Agreement shall, in the event of any dispute
regarding its meaning or application, be interpreted fairly and reasonably and neither
more strongly for, nor against any party.
5.11 Applicable Law. This Agreement is made, and shall be construed and interpreted, under
the laws of the State of Texas and venue shall lie in the State courts of Harris County,
Texas.
5.12 Severability. In the event any provisions of this Agreement are illegal, invalid or
unenforceable under present or future laws, and in that event, it is the intention of the
parties that the remainder of this Agreement shall not be affected. It is also the intention
of the parties that in lieu of each clause and provision that is found to be illegal, invalid or
unenforceable, a provision be added to this Agreement which is legal, valid or
enforceable and is as similar in terms as possible to the provision found to be illegal,
invalid or unenforceable.
5.13 Paragraph Headings. The paragraph headings contained in this Agreement are for
convenience only and will in no way enlarge or limit the scope or meaning of the various
and several paragraphs.
5.14 No Third Party Beneficiaries. This Agreement is not intended to confer any rights,
privileges or causes of action upon any third party.
5.15 No Joint Venture. It is acknowledged and agreed by the parties that the terms of this
Agreement are not intended to and shall not be deemed to create any partnership or joint
venture among the parties. The CITY, its past and future officers, elected officials,
employees and agents do not assume any responsibilities or liabilities to any third party in
connection with GANTSTEIN facilities or the design, construction or operation of any
portion of the facilities.
5.16 Public Information. Records and information provided to the CITY or its
representative(s) to verify compliance with this Agreement shall be available for public
inspection.
C'hapicr 380 F.con imic Develrgnrcni Agrcemem. Page 6
.17 Exhibits. The following Iahihit "A" is attached and incorporated by reference Cor all
purposes.
�.l S Multiple Ori',2inals. This Au-recment may be executed in multiple counterparts, each of
which shall be deemed an original, and all of which. taken together, shall ChnSlilUle but
one and the same instrument, which may he sufliciently evidenced by one counterpart.
x.19 :Authority to Enter Contract. Each party has the full power and authority to enter into and
pertorm this Agreement, and the person signing this Agreement on behalf of each party
has been properly authorized and empowered to enter into this Agreement. The persons
executing this Agrcement hereby represent that they have authorization to sign on behalf
oftheir respective entities.
�?O Non- Naiycr. Failure of either party hereto to insist on the strict performance of any of
the aurcements contained herein or to exercise any rights or remedies accnring hereunder
Upon default or failure of performance shall not be considered a waiver of the right to
insist on and to enforce by an appropriate remedy, strict compliance with any other
ohlioation hereunder to exercise any right or remedy occurring as a result of any future
default or failure ofperlormance.
I: \l:Cl. "II:D by the authorized representatives of the parties on the dates indicated
below.
CAN'' TI]IN ESQUI .LC
ANDRF \V ROSENBERG
7/J i _/n
(Date)
CITY OF BAYTOWN, THNAS,
GARRISON C. BRUNIBAC K
City Nlanaucr
(Date)
Chanicr ;so t-cnrNmuc ►kvei,gmcm , giccmcnt rage'.
ATTEST:
LETICIA GARZA
City Clerk
APPROVED AS TO FORM:
IGNACIO RAMIREZ, SR.
City Attorney
STATE OF TEXAS §
COUNTY OF
The foregoing instrument was acknowledged before me on this '( "'day of %urtu -,A , 2010, by
Andrew Rosenberg, Manager of Gantstein Esquire, LLC, a Texas limited liability company, on
behalf ofsaid entity.
[ SEAL I
KAREN L HORNER
1(9 Notary Public, State of Teues
commission Expires May 9, 2014
R % KarcnlFilcstContractsKiantstcin Gscquitc 3WE-conomic Development Agrcement.doc
Chapter 380 Economic Development ngreetrtent. Page 8
Notary Pu lic
Exhibit "A"
Fconomic Development Agreement Reporting Form
City of Baytown
RI PORTING YEAR 2011
I.0 Iatnployntent
1.1 Number ofemployees at facility for reporting year:
Full -time 3 a
Pan Time S v
Total 4°O
1.2 A%cr:ae Annual Salar\
A%cra_e. annual .alas tier reporting scar Sv
1.3 Total Payroll
00
Annual payroll I'm reporting \car S ������•"
�.0 hivesnnent
1.1 Agreement requires a taxable value of S 1.000.000 by December 31. 2010 tier the
Restaurant Facility.
Imemment titr first %car S �000 000
.o Value.
1 -otal imr.tment tier first \car of the agreement: 5_I a�)aOQ
IiCAD appraised value for subsequent reporting years:
L the authorized GANTSTEIN F :SQUIRT:. LLC representative, hereby certily that the nbme information
is correct and accurate pursuant to the terms of the Agreement.
GANT ' N LSQUIRt_.
DRIA Rt -NBF:RG
Manager