HomeMy WebLinkAboutPR 21195: AMENDMENT NO. 1, EDC, AGREEMENT WITH MAX HOLDINGS, LLC Interoffice
MEMORANDUM
To: Mayor, City Council, City Manager
From: Floyd Batiste, CEO
Date: December 10, 2019
Subject: P.R. No. 21195; Council Meeting of December 17, 2019
ATTACHED IS PROPOSED RESOLUTION NO. 21195
APPROVING AMENDMENT NO. 1 TO THE ECONOMIC
DEVELOPMENT CONDITIONAL GRANT AGREEMENT
BETWEEN THE CITY OF PORT ARTHUR SECTION 4A
ECONOMIC DEVELOPMENT CORPORATION AND MAX
HOLDINGS, LLC
P. R. No. 21195
12/9/2019 KVM
RESOLUTION NO.
A RESOLUTION APPROVING AMENDMENT NO. 1 TO THE
ECONOMIC DEVELOPMENT CONDITIONAL GRANT
AGREEMENT BETWEEN THE CITY OF PORT ARTHUR
SECTION 4A ECONOMIC DEVELOPMENT CORPORATION
AND MAX HOLDINGS, LLC
WHEREAS, per Resolution 19-208 dated May 21, 2019, the City Council of the City of
Port Arthur approved an Economic Development Conditional Grant Agreement(the"Agreement")
between the City of Port Arthur Section 4A Economic Development Corporation("PAEDC")and
Max Holdings, LLC ("Max Holdings") in an amount of$118,800.00 to reimburse Max Holdings
for the necessary infrastructure improvements for the development of a multi-tenant shopping
center located on 9th Avenue in Port Arthur, Texas; and
WHEREAS, the Performance Milestone Schedule as set forth in the Agreement attached
hereto as Exhibit "A" is incorrect as to the performance time frame; and
WHEREAS, at their regular Board meeting of December 2, 2019, the PAEDC Board of
Directors approved an amendment to the Agreement milestones correcting the project time frame
from six months to twenty-four months as detailed in the corrected milestones attached hereto as
Exhibit"B".
NOW THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF PORT ARTHUR, TEXAS:
Section 1. That the facts and opinions in the preamble are true and correct.
Section 2. That the City Council approves Amendment No. 1 to the Agreement between
PAEDC and Max Holdings, LLC as denoted in the amendment attached hereto as Exhibit"B".
Section 3. That a copy of the caption of this Resolution shall be spread upon the Minutes
of the City Council.
READ, ADOPTED AND APPROVED on this day of A.D., 2019,
at a Meeting of the City Council of the City of Port Arthur, Texas, by the following vote: AYES:
Mayor
Councilmembers
NOES:
Thurman Bartie, Mayor
ATTEST:
Sherri Bellard, City Secretary
APPROVE •
Floyd Batis e, PA C CEO
APPROV P AS TO ORM:
1 01
Guy N. Goodson, PAEDC Attorney
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APPROVED AS TO FORM:
Valecia R. Tizeno, City Attorney
1,1707738
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EXHIBIT "A"
ECONOMIC DEVELOPMENT CONDITIONAL GRANT AGREEMENT
BETWEEN
THE CITY OF PORT ARTHUR SECTION 4A
ECONOMIC DEVELOPMENT CORPORATION
AND MAX HOLDINGS, LLC
Executive Surn__ma,
The City of Port Arthur Section 4A Economic Development Corporation ("PAEDC')
finds that the construction of infrastructure
Port Arthur, Texas (the "Ci improvements located on 9th Avenue in the City of
business s ty), is beneficial for the development and expansion of new and
existingenterprises in the City. For the reason, based upon findings of economic
development as set forth in this Economic Development Conditional Grant
"Agreement), PAEDC conditionally grants to Max Holdings, Agee) lia (the
company, the costs of infrastructure improvements LLC, a Texas limited iab' .
of 5118,800.00. to construct the sh '
oPPg plaza in the amount
Max Holdings, LLC, a Texas limited liability co
to construct infrastructure improvements (the "Improvements")company
for a"Incentive plaza
Recipient")plansplans
(2) or more commercial businesses PAEDC shall reimburse Incentive Recipient
td two
thirty
percent (30%) of the conditional grant upon completion of ' thrrty
five percent (35%) when the Incentive Recipient obtains a improvements, thirty
commercial space, and then thirty five percent(35%)of the conditionalsg ant when the for the first
Recipient obtains a certificate of occupancy for the second commercial spit when Incentive
If Incentive Recipient breaches or defaults under this Agreement, then anyfunds
by PAEDC will automatically convert to a loan for a period of three (3) granted
default, and an interest rate of ten o n yearsfrom the date of
percent (I O/o)per annum.
Incentive Recipient agrees to send PAEDC reports each
quarter on the sof the Improvements and the proposed commercial developmentas ttined in the Performance
Milestone Schedule of this Agreement.
Incentive Recipient has agreed to provide as collateral for the performance of its
obligation under the Agreement a Letter of Credit_
ECONOMIC DEVELOPMENT CONDITIONAL GRANT AGREEMENT
BETWEEN
THE CITY OF PORT ARTHUR SECTION 4A
ECONOMIC DEVELOPMENT CORPORATION
AND MAX HOLDINGS, LLC,
Recitals
WHEREAS, Max Holdings, LLC, a Texas limited liability
property(the "Property") located on 9th Avenue, B133p�Y des12 7o nd Llop
T8
TR7 BLK 13 RG ] BLK 131 in Port specifically L8 TR4 RGE 1.247 and T8
and Arthur, Texas for the construction of the shopping plaza;
WHEREAS, §501.103, Texas Local Government Code authorizes expenditures on
infrastructure by the City of Port Arthur Section 4A
("PAEDC") if the PAEDC Board finds the expenditure Economic Development Corporation
infrastructure necessary to promote or develop new expanded businessen�rises,'or suitable for
WHEREAS, on May 6, 2019 following presentation of facts contained in u "
the PAEDC Board found that the facts reasonably Exhibit A,
improvements for construction of the shopping support the finding that the infrastructure
tenants are required in order to for tenants leaseg s plaza ("Plaza")the which will have two(2) or more
space in the Plaza; and
WHEREAS, the PAEDC Board approved an economic development conditional grant to
Max Holdings, LLC to redevelop and make necessary infrastructure improvements to the
Property; and
WHEREAS, the PAEDC and Max Holdings,
the terms and conditions for PAEDC's conditional
to set forth in this Agreement
desire
payments for the infrastructure
improvements to the Property.
NOW THEREFORE, the parties agree as follows:
AGREEMENT DATES
AGREEMENT START DATE
1. This Economic Development Conditional Grant Agreement(the "Agreement")is entered
into with an effective date of
no case later than
2019, by and between the City of Port Arthur 20lSection 4A EconomicDevelopment
Corporation ("PAEDC")and Incentive Recipient.
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AGREEMENT END DATE
2. This Agreement expires 30 days after Incentive Recipient either performs fully or
breaches the Agreement, subject to earlier termination or extension, voluntary or
involuntary, as provided herein.
PARTIES
3. Ci of Port Arthur Section 4A Economic Develoament Co a oration(`PAEDC"), located
at 501 Procter Street, Port Arthur, Texas 77640, is a co
on.
do business in the State of Texas under Chapter 501, 504 TexasIt is duly authorized to
(the "Act" or 'Development CorporationLocal Government Code
Act") and duly authorized by Resolution of the
City Council the ofPrt
bylaws,Arthure enter into this Agreement. So authorized and
as provided by the PAEDC g �I'r�es1dent and Secretary of the PAEDC Board
have the authority to execute this A
eem
4. Max HoIdin s LLC, a Texas limited liability company located at 3706 Greenway Pointe
Drive,Port Arthur,Texas 77642. Attn: Rahim Jasani.
CONDITIONS PRECEDENT
5. This Agreement has no legal consequences unless and until:
a. Both the PAEDC Board and the City of Port Arthur City Council approve the
Agreement in its final form; and
b. Incentive Recipient delivers to PAEDC quarterly
progress of construction improvements to the infrastructure and providesorts reflecting the
certificates of occupancy for the first commercial space and the second
commercial space.
PROMISED PERFORMANCE
6. The parties agree to perform as follows:
a. Performance by PAEDC
r PAEDC shall conditionally grant Incentive Recipient not to exceed
$118,800.00 for the purpose of making qualified infrastructure
improvements for the construction of the Plaza;
ii. Incentive Recipient will provide PAEDC evidence of completion of the
infrastructure improvements as set forth in Exhibit "C" and upon receipt
PAEDC will reimburse Incentive Recipient thirty percent (30%) of the
Conditional Grant;
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iii. Incentive Recipient will provide PAEDC a Certificate of Occupancy for
the first commercial space of the Plaza and upon receipt of that Certificate
of Occupancy, PAEDC will reimburse Incentive Recipient thirty-five
percent(35%)of the Conditional Grant; and
iv. Incentive Recipient will provide PAEDC a Certificate of Occupancy for a
second commercial space of the Plaza and upon receipt of the Certificate
of Occupancy, PAEDC will reimburse Incentive Recipient thirty-five
percent(35%)of the Conditional Grant.
These arc PAEDC's only obligations.
b. Performance by Incentive Recipient
i. Incentive Recipient shall make infrastructure improvements to the
Property as outlined in the Grant Application referenced in Exhibit "B."
ii. Incentive Recipient shall provide PAEDC with quarterly reports detailing
the progress of the infrastructure improvements.
iii. Incentive Recipient shall provide PAEDC certificates of occupancy for the
first commercial space and the second commercial space in order to
receive the reimbursable percentage that coincides with the completion of
the two (2)commercial spaces.
iv. Incentive Recipient shall use its best efforts to hire architect(s),
engineer(s), and general subcontractor(i) from the Nine-County Southeast
Texas Region for the construction of the Building;
v. Incentive Recipient will use its best efforts to
ensure
Texas residents are hired for the construction of e Building to the
maximum extent feasible.
vi. Incentive Recipient must complete the infrastructure improvements and
receive certificate of occupancy for each retail space in Section 6.a. above
within l 8 months from the date this Agreement is executed.
vii. On written demand by PAEDC and in response to Incentive Recipient's
failure to achieve a performance milestone, Incentive Recipient shall
provide PAEDC within 10 business days following receipt of such written
demand with assurances that it has both the intention and capabilities to
perform fully its Agreement dual obligations.
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INCENTIVE RECIPIENT'S PERFORMANCE MILESTONE SCHEDULE
7. Although failure to achieve a performance milestone is not a breach of Agreement,
failure is grounds for PAEDC to demand reasonable assurances' fromcin en ve
Recipient that it can and will fully perform its Contractual obligations. Failure to provide
demanded assurances is a breach of Agreement.
8. Incentive Recipient's performance milestones are contained in Exhibit "C."
PAEDC'S CONDITIONAL OBLICATIONS AND LIMITED LIABILITY
9. The PAEDC's sole liability/obligations, if any, shall be to Incentive Recipient and shall
be limited to the conditional incentive obligations detailed in this Agreement. The
PAEDC shall not be liable, in Agreement or otherwise, to Incentive Recipient, or to any
person or entity claiming by or through Incentive Recipient., for any expense,
expenditure or cost incurred by or on behalf of Incentive Recipient related to the
construction of the Building made the basis of this Agreement.
LIQUIDATED DAMAGES FOR BREACH OF AGREEMENT BY INCENTIVE RECIPIENT.
10. In the event Incentive Recipient breaches this Agreement or does not fulfill its obligation
to complete infrastructure improvements in order to provide PAEDC certificates of
occupancy, Incentive Recipient will not be reimbursed for costs incurred by them for
infrastructure improvements.
11. It is expressly understood and agreed by the parties that any right or remedy shall not
preclude the exercise of any other right or remedy under this Agreement or under any
provision of law, nor shall any action taken in the exercise of any right or remedy by
deemed a waiver of any other rights or remedies. Failure to exercise any right or remedy
hereunder shall not constitute a waiver of the right o exercise that or any other right or
remedy at any time.
RECORDS/INSPECTION/PAEDC AUDIT
12. Incentive Recipient shall maintain records as necessary to allow the PAEDC to audit in
compliance with this Agreement and the representations and warranties contained herein
and in Incentive Recipient's application.
13. Incentive Recipient shall give the PAEDC, or any of its duly authorized representatives,
access to and right to examine all books, accounts, records, reports, files and other
papers, things or property belonging to or in use by Incentive Recipient pertaining to this
Agreement. Such rights to access shall continue as long as the records are maintained by
Incentive Recipient. Incentive Recipient agrees to maintain such records in and
accessible location. Driver's license information is appropriate for interim reporting of
Port Arthur residents hired. The reporting objective is to include documentation
'Examples of reasonable assurances arecoP ies of pending Agreement g s and commitment letters.
Page s
necessary for PAEDC to verify Incentive Recipient's reports without further outside
inquiry.
14.All records pertinent to this Agreement shall be retained by Incentive Recipient at least
three (3) years following the date of termination of this Agreement, whether said
termination is a result of default or whether said termination is a result of fins]
submission of a close out report by Incentive Recipient detailing Incentive Recipient's
compliance with its obligations provided herein. Further, in the event any litigation,
claim or audit arising out of or related to this Agreement is instituted before the
expiration of the three (3) year period and extends beyond the tree (3)
records will be maintained until all litigation, claims, or audit findings involving this
Agreement and the records made the basis of same has been resolved
15. Upon written request, Incentive Recipient shall
reasonably necessary for PAEDC to comply with the Development
Pet DC with all reports
opCorporation Act.
16. It is expressly understood and agreed by the parties hereto that if Incentive Recipient fails
to submit to PAEDC in a timely and satisfactory manner any report
Agreement, PAEDC, may at its sole discretion, demand assurances that Incentive
Recipient can and will fully perform its Contractual obligations. If Incentive Recipient
fails to provide adequate assurances in ten (10) business days then Incentive Recipient is
in breach and PAEDC is not obligated to reimburse Incentive Recipient for expenses
incurred for infrastructure improvements.
17. The PAEDC reserves the right, from time to time, to carry out field inspections/audits to
ensure compliance with the requirements of this Agreement. After completion of any
such audit, the PAEDC, at its option, may provide Incentive Recipient with a written
report of the audit findings. If the audit report details deficiencies in Incentive Recipient
performance under the terms and conditions of this Agreement, the PAEDC may
establish requirements for the timely correction of any such deficiencies by Incentive
Recipient.
HOLD HARMLESS
18. INCENTIVE RECIPIENT SHALL INDEMNIFY, DEFEND AND HOLD THE PAEDC
AND THE CITY(TOGETHER THE"INDEMNIFIED PARTIES")HARMLESS FROM
ALL INJURIES, CLAIMS, LIABILITIES, COSTS OR DAMAGES (INCLUDING
COURT COSTS AND REASONABLE ATTORNEY'S FEES) SUSTAINED BY OR
THREATENED AGAINST ANY OF THE INDEMNIFIED PARTIES FOR INJURY
OR DEATH TO PERSONS OR PHYSICAL DAMAGE TO PROPERTY ARISING
OUT OR RELATING TO THE PERFORMANCE BY INCENTIVE RECIPIENT OF
ITS OBLIGATION UNDER THIS AGREEMENT.
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SUBCONTRACTORS
19. Incentive Recipient may subcontract obligations under this Agreement
owever,
Incentive Recipient, in subcontracting for any performances describen this Agreement,
expressly understands that PAEDC is in no way liable to Incentive Recipient's
subcontractor(s).
20. Incentive Recipient is responsible for performances, as if such performances rendered
were rendered by Incentive Recipient. PAEDC maintains any right of action which may
exist or which may be subsequently accrue to PAEDC under this Agreement.
27. Incentive Recipient, as well as all of its subcontractors, shall comply with all applicable
federal, state, and local laws, regulations, and ordinances relatin to the o
activities of the redevelop of the Building. g perations and
CONFLICT OF INTEREST/DISCLOSURE OBLIGATION
22. Conflict of Interest: No employee, agent, officer or elected or appointed official of the
City of Port Arthur or the PAEDC who has participated in a decision making process
related to this Agreement (without recusing him/herself and executing
affidavit) may obtain a personal or financial interest or benefit from an PAEDC assisted
activity, or have an interest in any Agreement
proceeds thereof) with respect to an PAEDC assisted activity,
duringror agreement for
one I their tenure or for
( ) year thereafter. Incentive Recipient shall ensure compliance with applicable
provisions of the Act and Chapter 171,Local Government Code.
23.Disclosure: In conjunction with execution of this A
fully disclosed to PAEDC all known and gr'eement, Incentive Recipient has
in Incentive
Recipient and its general partner(whether stockholder,omanager,wners f memberor otherwie).
In the event of any change in ownership or control of Incentive Recipient of five percent
(5 %) or greater, Incentive Recipient shall notify PAEDC in writing. Further, Incentive
Recipient shall be obligated to notify in writing the PAEDC in the event any time prior
to, during or one(1)year after the term of this Agreement, any City or PAEDC employee
or representative or any third party with a conflict of interest obtains or proposes to
obtain a financial benefit, direct or indirect, from Incentive Recipient or its general
partner. Failure to provide said notice immediately or no later than five(5)business days
after receipt of information shall constitute a default herein.
NONDISCRIMINATION/EMPLOYMENT/REPORTING
24. Incentive Recipient shall ensure that no person shall on the
religion, sex,handicap,or national origin be excluded from participation in,be race, color,
e
benefits of, or be subjected to discrimination under any construction activity.
Additionally:
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a. To the greatest extent feasible, opportunities for training
arising
in connection with the redevelop of the Building wilbee given and p to Portt Arthur
residents;
b. To the greatest extent feasible, Agreement s for work to be
connection with the construction of the Building will be awarded first to Port
orm� in
Arthur residents and businesses, then to the residents and businesses of the nine-
county Southeast Texas Region; and
c. If Incentive Recipient advertises for workers in any media then it will advertise in
the"Port Arthur News."
LEGAL AUTHORITY
25. Incentive Recipient assures and guarantees that Incentive Recipient
and/or corporate authority to enter into this Agreement, perpossesses legal
ces
Incentive Recipient has obligated to perform hereunder and has provided,
and the willsinithe
future provide, as requested by the PAEDC, such corporatep the
evidence this authority. resolutions necessary to
26. The person or persons signing and executing this Agreement on behalf of Incentive
Recipient, or representing themselves as signing and executing
of Incentive Recipient, do hereby warrant and Agreement have
behalfben
duly authorized by Incentive Recipient to execute this Agreement he,
onshe behalf or o fInceenbti
ve
Recipient and to validly and legally bind Incentive Recipient to all terms, performances,
and provisions herein set forth.
NOTICE OF LEGAL OR REGULATORY CLAIMS AGAINST INCENTIVE RECIPIENT.
27. Incentive Recipient shall give PAEDC immediate notice in writing of 1) any legal or
regulatory action, including any proceeding before an administrative agency filed against
Incentive Recipient, directly or indirectly; and 2) any material claim against Incentive
Recipient or its general partner, which may impact continued operations. For
herein, "material" claims shall mean claims in excess of$15,000. Except as th�osse
directed by PAEDC, Incentive Recipient shall furnish immediately to PAEDC copies of
all pertinent documentation of any kind received by Incentive Recipient with respect to
such action or claim.
CHANGES AND AMENDMENTS
28. Except as specifically provided otherwise in this Agreement, any alterations, additions,
or deletions to the terms of this Agreement shall be by amendment in writing and
executed by all parties to this Agreement.
29. It is understood and agreed by the parties hereto that performances under this Agreement
must be rendered in accordance with the Act, the regulations promulgated under the Act,
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the assurances and certifications made to PAEDC by Incentive Recipient, and the
assurances and certifications made to the City of Port Arthur with regard to the
construction of the PIaza. Based on these considerations, and in order to ensure the legal
and effective performance of this Agreement by all parties, it is a
be parties
hereto that the performances under this Agreement may be amended thy
efol owing
manner: PAEDC may from time to time during the period ofperfo
of this
Agreement issue policy directives which serve to establish interpret
clarify
performance requirements under this Agreement consistent with the intent of the parties.
Such policy directives shall be promulgated by the PAEDC Board of Directors in the
form of PAEDC issuances shall be approved by the City Council and shall have the effect
ofifherein.ualifying terms of this Agreement and shall be binding upon Incentive Recipient,
as30. Any alterations, additions, or deletions to the terms of this
by changes in federal, state, or local law are automatic�mmcoent woch are required
into this
Agreement without written amendment hereto, and shall become effecti etn the date
designated by such Iaw or regulation. Incentive Recipient agrees to comply with all
federal, state, and local laws whether existing or hereinafter enacted
DEFAULT/TERMINATION
31. In the event of default of any of the obligations of Incentive Recipient detailed herein or
in the event of breach of any of the representations of or warranties of Incentive
Recipient either detailed herein or in Incentive Recipient's application to the PAEDC,the
PAEDC may, at its sole and exclusive option and remedy,
terminate
whole or in part. In the event of such termination, but subjecteprovisions hereof, in
addition to (i)any other remedies available to the PAEDC as provided by the laws of the
State of Texas or(ii) any other remedies available to the PAEDC as provided herein, the
PAEDC may, at its sole option:
a. Withhold and/or disallow further PAEDC grant payments or incentives to
Incentive Recipient, including funds to be advanced to Incentive Recipient
hereunder.
32. In addition to the foregoing, the parties agree that this Agreement may be terminated at
any time when both parties agree, in writing, to the terms and conditions of any such
voluntary termination.
INCENTIVE RECIPIENT AUDITS
33. If directed by the PAEDC Board, Incentive Recipient shall arrange for a compliance audit
by a certified public accountant to verify performances reported under this Agreement.
34. Incentive Recipient shall take all necessary actions to facilitate the
and all such audits, whether annual, mandatory, performanced r any
Agreement. or otherwise requested under this
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35. Subject to financial privacy requirements of Incentive Recipient and properly designated
requests for non-disclosure due to proprietary reasons, all approved audit reports may be
made available for public disclosure to the extent required by the Public Information Act.
ENVIRONMENTAL CLEARANCE REQUIREMENT
36. Incentive Recipient understands and agrees that by execution of this Agreement,
Incentive Recipient shall be responsible for making all reasonable efforts in providing to
PAEDC all information, concerning this PAEDC funded project,required for PAEDC to
meet its responsibilities for environmental review, decision making, and other action
which applies to PAEDC in accordance with and to the extent specified in federal, state,
and local law. Incentive Recipient further understands and agrees that Incentive
Recipient shall make all reasonable efforts to assist PAEDC in handling inquiries and
complaints from persons and agencies seeking redress in relation to environmental
reviews covered by approved certifications.
ORAL AND WRITTEN CONTRACTS/PRIOR AGREEMENTS
37. All oral and written contracts between the parties to this Agreement relating to the subject
matter of this Agreement that were made prior to the execution of this Contract have been
reduced to writing and are contained in this Contract.
38. The documents listed below are hereby made a part of this Agreement for all purposes,
and constitute promised performances by Incentive Recipient and/or PAEDC, as the case
may be, in accordance with this Agreement:
a. Exhibit "A"Findings of Fact for Infrastructure Improvements
b. Exhibit"B"Max Holdings,LLC Grant Application for PAEDC for funding
c. Exhibit"C"Performance Milestones
d. Exhibit"D" Certification Regarding Lobbying
e. Exhibit"E"Compliance Statement
f. Exhibit"F" Commercial Promissory Note
g. Exhibit"G"Letter of Credit
VENUE
39. For purposes of litigation that may accrue under this Agreement, venue shall lie in
Jefferson County, Texas where substantially all the performance will occur.
ADDRESS OF NOTICE AND COMMUNICATIONS
City of Port Arthur Section 4A Economic Development Corporation
501 Procter Street
Port Arthur, Texas 77640
ATTN: Floyd Batiste, Chief Executive Officer
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Pagc 10
Max Holdings, LLC
3706 Greenway Pointe Drive
Port Arthur, Texas 77642
Attn: Rabin Jasani
CAPTIONS
40. This Agreement has been supplied with captions to serve only as a guide to the contents.
The captions does not control the meaning of any paragraph or in any way determine its
interpretation or application.
COMPLIANCE WITH FEDERAL,STATE AND LOCAL LAWS
41.Incentive Recipient shall comply with all federal, state, and local Iaws, statutes,
ordinances, resolutions, rules, regulations, orders and decrees of any court or
administrative body or tribunal related to Incentive Recipient's performance under this
Agreement. Upon request by PAEDC or by the City of Port Arthur, Incentive Recipient
shall furnish reasonable satisfactory proof of its compliance herewith including execution
of the Certification Regarding Lobbying attached hereto as Exhibit "D" and the
Compliance Statement attached hereto as Exhibit"E".
ASSIGNMENT
42. This Agreement may not be assigned by Incentive Recipient to another entity unless and
until the PAEDC, by the action of the PAEDC Board, approves the assignment.
SUPPLEMENTAL COVENANT
43. Incentive Recipient and any branch, division or department of Incentive Recipient
certifies that they have not and will not knowingly employ an "undocumented worker" which
means "an individual who, at the time of employment, is not lawfully admitted for
permanent
residence to the United States or authorized under law to be employed in that manner in the
United States."
44. Incentive Recipient acknowledges that it has reviewed Chapter 2264, Texas
Government Code and hereby affirmatively agrees by execution of this Agreement to repay the
amount of any incentive with interest at the rate of ten 10
%) percent per the 120th day after the date PAEDC notifies Incentive Recipient of a violation.
um not later than
45. Incentive Recipient acknowledges PAEDC may bring a civil action or cover any
amounts owed under this Chapter and further acknowledges that PAEDC may recover court
costs and reasonable attorneys' fees incurred in an action brought under.§2264.101(a). Incentive
Recipient is not liable for a violation of this Chapter by a subsidiary, affiliate or franchisee of the
Incentive Recipient or by a person with whom the Incentive Recipient contracts.
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ATTORNEY APPROVALS
APPROVED AS TO FORM:
Guy Goodson, General Counsel fbr PAEDC
VERIFIED AS CONSISTANT
WITH CITY COUNCIL RESOLUTION: Resolution Number:
/t / )
.1 Torr .1For twincy
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Pap 12
CONTRACT EXECUTION
CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT
CORPORATION
SIGNED AND AGREED TO on the Q ' day of
2019.
By. .irLL,..4: _ fes'��•
PresId:, By �z%'
Sectary
vr
c,,s i
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Page 13
MAX HOLDINGS,LLC
SIGNED EED AND AGRTO on the 4Y\
day of `v‘"-e-' .2019
(de
0160723
M
EXHIBIT "A"
FINDINGS OF FACT FOR INFRASTRUCTURE IMPROVEMENTS
Facts:
• Max Holdings, LLC has requested an incentive agreement from the PAEDC
for infrastructure improvements to construct the shopping plaza on 9th
Avenue in Port Arthur, Texas.
• Max Holdings, LLC wants to make infrastructure improvements in order to
make it suitable for commercial tenant space which will house two (2) or
more businesses.
Findings:
• The PAEDC Board of Directors has found that constructing infrastructure
improvements on 9th Avenue in Port Arthur, Texas would lead to the
development of new and expanded business enterprises in the City of Port
Arthur.
• The infrastructure improvements may lead to the opening of two new
businesses in the City of Port Arthur.
• The opening of such businesses would increase sales tax revenues for the
City of Port Arthur and add to the City ad valorem tax base.
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•
EXHIBIT "C"
PERFORMANCE MILESTONE SCHEDULE
MAX HOLDINGS, LLC
IIDATE MILESTONE
I Review approved infrastructure plans by the City of Port Arthur
JUNE 1, 2019 and projected costs with PAEDC for the construction of the
project.
MAX Holdings,LLC will issue a status report to PAEDC on
(b) JULY 30, 2019 Project construction on 9th Avenue in Port Arthur, Texas
MAX Holdings, LLC will provide evidence of completion of the
AUGUST 31, 2019 qualifYing infrastructure improvements.
PAEDC will issue 30%of Economic Incentive Grant
MAX Holdings,LLC assign letter of credit for 30%of
AUGUST 31, 2019 Infrastructure Incentive Grant
MAX Holdings, LLC will obtain Certificate of Occupancy for the
(d) OCTOBER 30,2019 first retail tenant space and provide a copy to the PAEDC
PAEDC will issue 35% of Economic Incentive Grant
IMAX Holdings, LLC assign letter of credit for 35%of
OCTOBER 30, 2019 Infrastructure Incentive Grant
I
NOVEMBER 30, reMAXal Holdings, LLC will issue a satus report to PAEDC on
2019 g project construction on 9thAvenue in Port Arthur,
Texas
MAX Holdings,LLC will obtain Certificate of Occupancy for the
second retail tenant space and provide a copy to the PAEDC.
(g) DECEMBER 30, 2019 PAEDC will issue the remaining 35% of Economic Incentive
Grant
MAX Holdings, LLC meets all of their contractual agreement.
(h) JANUARY 30, 2020 File is closed
IPAEDC Board of Directors release Letter of Credit to MAX
JANUARY 30,2020 Holdings, LLC
*1640723
Page 27
EXHIBIT"D"
CERTIFICATION REGARDING LOBBYING
For Contracts, Grants,Loans, and
Cooperative Agreements
The undersigned certifies,to the best of his knowledge and belief;that:
1• No funds have been paid or will be Paid, by or on behalf of the undersign
to
any person for influencing or attempting to influence an officer or emplyee of
any agency, a member of the City or of the PAEDC
in connection with the
awarding of any contract, the making of any grant, the making of any loan, the
entering into of any cooperative
loan,or coo agreement,or modification of any contract,
cooperative agreement
2 The undersigned shall require that the 1
the award documents for all sub-awards (including
be included in
sub-
grants, and contracts under grants, loans, and tiding subcontraan, t
all Subs shallcooperative agreements), and that
certify and disclose accordingly.
This certification is material representation of fact which reliance was placed when this
transaction was made or entered into. Submission of this certification is a prerequisite for
making or entering into this transaction.
MAX HOLDINGS,LLC
Date: 2y
r• j
01640723
Page is
•
EXHIBIT "E"
COMPLIANCE STATEMENT
Max Holdings, LLC hereby certifies that it has fully complied with Local
Government Code §176.006, as amended, which mandates the disclosure
requirements for persons who contract or seek to contract with a local
governmental entity.
MAX HOLDINGS,LLC
Date: ,' 2-4
By /
#1640723
kip 19
EXHIB
CONDITIONAL CO RC L PROMISSORY NOTE
Port Arthur,Texas
This COMMERCIAL PROMISSORY NOTE becomes effective on the date when Max Rol
LLC a limited liability � ,
centive and LoanG (hereinafter called `Maker") breaches that certain Econ'
Development Corporation(heerreinamt�called"Lender')een the 'of Port Arthur Section 4A Economic019
and Maker,dated 2019
Effective Date of Note: The Note shall be dated effective the
201 which is the date upon which Lenderday of
Economic Incentive Contract & Loan provided notification to Maker of its default under the
Maker datedmem (the "Agreement") by and between Lender and
2019("Date of Default'.
Principal Amount: Principal amount is $
credits earned by Maker which is $ less the incentive
according to the Agreement(descnbed hereinabove).
Term of the Loan: From the Date of Default, Maker shall thereafter make equal monthly
insrtailments of principal and interest(interest10 t per annum) until being calculated as hereinafter m fi
sped at the rate of
Maker, a (the "Final Payment Date"). Lender shall provide to
Payment amortization schedule for the monthly installments due hereunder. Maker
that all principal and interest on this Note shall be due and agrees
FOR VALUE payable by the Final Payment Date:
�, the and. .; ,ed "Maker", promises to payto
P.O. Box 1089, Port Arthur, Texas, 77. t 1089, or such other ear' office at
shall from time to time deignate in written noce to Maker, °r places as the hider hereof
lawful money of the United States of America, together with interest amount,principal h in Ieghereo
until maturity at the rate of ten percent(10%)per'annum as detailed herein All flim the date hereof
rate of fifteen t due percent(15%)and�� shall bear interest from date of maturity
until)1� annum, or to the maximum extent allowed bylaw ( ppacihd at the
greater)as may hereafter be in effect,payable on demand after (whichevea is
maturity.
Any notices required or permitted to be given by the holder hereof to Maker
provisions of this note shall be in writingand shall be eitherpursuant to by
first class United States mail, addressed to Maker at the personally deliveredtor fitted b
notice (or at such other address as Maker may, address designated below for receipt hoolder
hereof for receipt of notices hereunder). Any suchnotice to time, designate a swriting to a holder
of the date of delivery, and any notice transmitted by mail, in personally accordancedewith all bethe
effective as
g
such
provisions, shall be deemed to have been given to and received by a o the date o whwhr h
postage prepaitice d deposited with the United States Postal Service, properly addressed and with
This note is also secured by and entitled to the benefits of all other security
pledges, collateral assignments, deeds of trust, guaranties, m agreements,
anlien
mstruments, if any, of any kind executed by Maker or by anyothermortgages,
assignments,anyd s
owing by Maker to the Lender. Such lien mstruments shall party asx security for loans
herewith,those heretofore executed, and those hereafter executed.include those executed simultaneously
drawer,If any installment or payment of principal or interest of this note is not paid when due or any
acceptor,endorser,guarantor, surety, accommodation
primarily or secondarily liable or for a party rtor other fh person now m hereafter
called an "other liable ,: payment of all or any part of this note(each hereinafter
die, or re become insolvent (however such insolvency may be
evidenced); or if any pg
' remedy supplementary to or in enforcement of
81640723
Page 28
judgment shall be resorted to or commenced
to judgment
property any of them;or if man against Maker or any other liable party,or with respect
shall take possession of any substantial p governmental authority or any court at the instance thereof
of, or a shall be appointed ss orss assume control over the affairs or
operations attachment receiverr garnshall
b for or take possession of the p i;or a writ or
any order other liabletshall be issued or made against any of property o
or anyoer party; or if any indebtedness for which Maker or any other liabI of Maker lor
y
secondarily liable shall not be paid when due or shall become due and -acceleration r'm Y
maturity thereof; or if any event or.condition shall occur which shall payable of yof
h
indebtedness to declare it due and payable upon the lapsepeg of the holder h any such
if Maker or any other liableof time,giving of notice or otherwise; or
liquidated or otherwise party (if other than a natural person) shall be dissolved, wound
mt Lender; ff�inated, or a party to any merger or consolidation without the written
Maker or any other liable party shall sell substantially
portion of its assets without the written consent of Lender or if Maker or any all liableor an
to furnish financial information requested byLender; or if other other party
or has famished anyfinancial or other iformation or staMaker or any liable party furnishes
respect or if a default occurs under any which are misleading in any
as security for this note; or Y instrument now or hereafter executed in connection with or
any event occurs or condition exists which causes Lender to in� good
faith deem itself insecure or in good faith believe the prospect of a
or any other liable party under this note,under any payment or executed ine n Maker
with or as security for this note, or under anyother indebtedness
or agreement executed connection
to Lender is ' • thereupon, at the option of Lender, thhe psi ci Makerof or andn accruedr ie party
of this note andpany and all other indebtedness of Maketo Lenderend balance nbinterest
payable forthwith without demand, s}►all become and be due and
payable the maturity hereof notice of default, notice of acceleration, notice of intent to
of which are hereby expressly waived by presentment,protest or notice of dishonor, all
default without waiving any prior or susequent akerdefault each other liable party. Lender may waive any
If this note is not paid at maturity whether by acceleration or otherwise, and is
hands of any attorney for collection, or suit is filed hereon, or proce�iplacedin the
bankruptcy, receivership, reorganization, arrangement or other legal are hado in probate,
CO�fMa reasonable and
each
amount for liable
party agree
fie.to pay Lender its collectiogs for inccollluding
t
costs, including court
It is the intention of Maker and Lender to conform strictly to applicable
in thatgly,if the transaction contemplated herebyusury law,laws.
event, notwithstanding anything to the would in usurious under meat enteredte then,in
connection with or as security for this note, it ism mein oras f in any agreement aggregate intofl
consideration which constitutes interest under applicable that is taken (i) the tc of all
charged or received under this note or under any of the other aforesaid�a'reserved, contotherwiseacted for,
connection with this note chall under no laments oru fmsint
allowed byWinces exceed the maximum amount of interest
applicable law, and any excess shall be credited on this note by the holder hereof(or, if
this note shall have been paid in full,refunded to Maker); (ii)in the event that maturityof
is accelerated by reason of an election by the holder hereof this note
otherwise, or the event of any ��from any default hereunder or
otherwise, or inet may neerof include requiredmoorp them permitted prepayment then such consideration that
and excess interest, if any, provided for in this note or maximum
shall
allowed by applicable law,
of the date of such acceleration orshall be canceled automatically as
note (or thisf noteh l have beenprepayment and, if theretofore prepaid, shall be credited on this
rate of interest taken, paidfull,refunded to Maker); and(iii)all calculations of the
the otherfeforesaireserved, contracted for, charged or received under tins note or under any of
puepose of determining
or otherwise in connection with this note, that are made for the
etermining whether such rate exceeds the maximum lawful rate shall be made, to the
extent permitted by applicable law,by amortizing,prorating, allocating,
and such inerest
over the entire term of the loan evidenced by this note(including all renewal ander ceded terms)
Maker may prepay all or any part of the principal of this note before maturity
pity. No partial prepayment shall reduce, postpone or delay the obligation of Maker twithout
continue
#1640723
Pip 21
•
paying the installments herein provided on their respective due dates following any such partial
prepayment until this note is fully
The Maker shall be directly and primarily
hereunder, and, y.liable for the payment of all
except for notices specificallysums called for
Pursuant to the earlier provisions of this note Maker� to be given by the holder hereof to Maker
Presentment for a and each other liable party hereby expressly
waiveon to demand, er payment,notice of nonpayment,protest, notice of protest,notice of
and diligence accelerate collecting
notice of acceleration of maturity,and all other notice,filing of suit
hereby any substitution,tngthis
ofe or enforcing or handling any of the security therefor, and do
the release of any other liable exchange or release,in whole or in part,of any security here-for or
from time to time, of this epaorty, and do hereby consent to any and all renewals or extensions
any part hereof either before or after maturity, all without any
notice thereof to any of them and without affecting or releasing the liability
holder hereof;in order to enforce payment of this note by any other liablof any of them. Each
first institute suit or exhaust its remedies against Maker and to enforce its n his againstshall required to
therefor prior to enforcing payment of this Note by any other liable party. any security
SIGNED AM)AGREED TO on the R5 day of201 .
Max Holdings, LLC
Jr)) rJ
BY
Its: nf — —
'i'HE STATE OF TEXAS §
COUNTY OF JEFFERSON § ACIOVOWLEDGEA'IEIV'T
BEFO ME, nit; UNDERSIGNED Notary Public, on this day
faappeared
, a known to me to be the person whose name issubscribed
foregoing instrument,and acknowledged to me that he/she executed the same as the act and deed of
Max Holdings, LLC, a Texas limited liability company for the purposes and consideration
therein expressed, and the Capacities therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the o?J of. 2019. day
a , ,
RACHEL A.JACQUET 1
'=MY COMMISSION EXPIRES Notary Public, State "Texas
4
JUNE 10,2023
rfr,t`s NOTARY ID:12014508
*1640723
Page 22
•
MAKERS'ADDRESS FOR RECEIPT OF NOTICE:
Max Holdings,LLC, a Texas limited liability company
3706 Greenway Pointe Drive
Port Arthur,Texas 77642
Attn:Ranim Jasaai
Paw 23
EXHIBIT"G"
LEITER OF CREDIT
#1640723
PRP 24
EXHIBIT " B "
FIRST AMENDMENT TO THE
ECONOMIC DEVELOPMENT CONDITIONAL GRANT AGREEMENT
BETWEEN
THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT
CORPORATION
AND
MAX HOLDINGS, LLC
WHEREAS, Max Holdings, LLC ("Max Holdings") and the City of Port Arthur Section
4A Economic Development Corporation ("PAEDC") entered into an Economic Development
Conditional Grant Agreement (the "Agreement") on pursuant to
Resolution No. 19-
WHEREAS, the Agreement provided that Max Holdings would make infrastructure
improvements to property located at 9th Avenue in Port Arthur, Texas for the construction of a
multi-tenant shopping plaza; and
WHEREAS, the Agreement provided that Max Holdings would receive thirty percent
(30%)of the conditional grant upon completion of infrastructure improvements,thirty five percent
(35%) when the Max Holdings obtains a certificate of occupancy for the first commercial space,
and then thirty five percent (35%) of the conditional grant when the Max Holdings obtains a
certificate of occupancy for the second commercial space.; and
WHEREAS, Max Holdings has requested for PAEDC to modify the performance
milestones to allow it additional time to construct the first commercial tenant space; and
WHEREAS, the PAEDC Board of Directors agreed to amend the Agreement and
performance milestones at its December 2, 2019 regular meeting.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF
THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT
CORPORATION that:
1. This Amendment to the Economic Development Conditional Grant Agreement
between PAEDC and Max Holdings was approved by the PAEDC Board of Directors on
December 2, 2019.
2. This Amendment to the Agreement shall be effective upon approval by the City of
Port Arthur, Texas.
3. Exhibit C to the agreement is amended per the attached Performance Milestone
Schedule (Modified) for Max Holdings attached hereto as Exhibit "C".
4. The recitals to this Amendment are incorporated and fully referenced in this
Amendment.
7. Other than the amendment set forth herein, Max Holdings and PAEDC ratify and
affirm all terms and conditions of the Agreement dated
SIGNED AND AGREED to on this day of , 2019.
City of Port Arthur Section 4A
Economic Development Corporation
By:
President
ATTEST:
Secretary
THE STATE OF TEXAS §
COUNTY OF JEFFERSON §
This instrument was acknowledged before me on the day of , 2019, by
as President and as Secretary on
behalf of City of Port Arthur Section 4A Economic Development Corporation.
Notary Public, State of Texas
#1708087 Page 2
Max Holdings, LLC
By:
Its:
THE STATE OF TEXAS §
COUNTY OF JEFFERSON §
This instrument was acknowledged before me on the day of , 2019. by
behalf of Max Holdings, LLC.
Notary Public, State of Texas
#1708087 Page 3
EXHIBIT "C"
PERFORMANCE MILESTONE SCHEDULE (Modified)
MAX HOLDINGS, LLC
DATE MILESTONE
Review approved infrastructure plans by the City of Port
JUNE 30, 2019 Arthur and projected costs with PAEDC for the construction
of the project.
DECEMBER 31, 2019 �
MAX Holdings will issue a status report to PAEDC on
Project construction on 9 Avenue in Port Arthur, Texas
MAX Holdings will provide evidence of completion of the
qualifying infrastructure improvements and assign letter of
JUNE 30, 2020 credit to PAEDC for 30% of the total incentive amount.
PAEDC will issue 30%of Economic Incentive Grant to Max
Holdings
MAX Holdings will obtain Certificate of Occupancy for the
first retail tenant space and provide a copy to the PAEDC.
FEBRUARY 28' 2021 Max Holdings will increase Letter of Credit in an amount
equal to an additional 35%of the Incentive Grant.
PAEDC will issue 35%of Economic Incentive Grant to Max
Holdings
MAX Holdings will issue a status report to PAEDC on
MARCH 31, 2021 remaining project construction on 9th Avenue in Port Arthur,
Texas
MAX Holdings will obtain Certificate of Occupancy for the
MAY 31, 2021 second retail tenant space and provide a copy to the PAEDC.
PAEDC will issue the remaining 35% of Economic Incentive
Grant
JUNE 30, 2021 PAEDC Board of Directors release Letter of Credit to MAX
Holdings and file is closed.
#1708087 Page 4