R-2014-136 2014-11-10RESOLUTION NO. R2014-136
A Resolution of the City Council of the City of Pearland, Texas,
authorizing the City Manager or his designee to enter into a Tax
Abatement Agreement with Keystone Engineering Group, Inc. and
Pearland Building III for improvements to be constructed near the
intersection of McHard Road and SH 35.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS:
Section 1. That certain Tax Abatement Agreement, a copy of which is attached
hereto as Exhibit "A" and made a part hereof for all purposes, is hereby authorized and
approved.
Section 2. That the City Manager or his designee is hereby authorized to execute
and the City Secretary to attest a Tax Abatement Agreement.
PASSED, APPROVED and ADOPTED this the 10th day of November, A.D., 2014.
TOM REID
MAYOR
ATTEST:
APPROVED AS TO FORM:
DARRIN M. COKER
CITY ATTORNEY
THE STATE OF TEXAS
Resolution No. R2014-136
Exhibit "A"
COUNTIES OF BRAZORIA,
FORT BEND, AND HARRIS
TAX ABATEMENT AGREEMENT
This Tax Abatement Agreement (this "Agreement") is entered into by and
between the City of Pearland, Texas, a home rule city and Municipal Corporation of
Brazoria, Fort Bend, and Harris Counties, Texas, duly acting by and through its City
Manager (hereinafter called the "City"), and Keystone Engineering, Inc., a Texas S
Corporation ("Keystone") duly acting by and through its President, William S. Ring, and
Pearland Building III, Inc. a Texas Corporation (hereinafter called "Pearland Building
III"), duly acting by and through its President, Mark Ring. Unless individually
recognized, Keystone and Pearland Building III shall be collectively referred to as the
"Companies".
WITNESSETH:
WHEREAS, on the 13th day of October, 2014 the City Council of the City passed
Ordinance No.1496 establishing Reinvestment Zone #26 in the City for general
business tax abatement, as authorized by Chapter 312, Tax Code, V.A.T.S. as
amended (the "Code"); and
WHEREAS, the City previously adopted Resolution No. R2013-14, establishing
appropriate guidelines and criteria for governing reinvestment zones and tax abatement
agreements to be entered into by the City as contemplated by the Code; and
WHEREAS, the City's objective is to maintain and/or enhance the general
business economic and employment base of the Pearland area for the long term
interest and benefit of the City, in accordance with Resolution No. R2013-14 and the
Code; and
WHEREAS, the contemplated use of the Premises, as hereinafter defined, and
the contemplated improvements to the Premises in the amount as set forth in this
Agreement and the other terms hereof are consistent with encouraging development of
said Reinvestment Zone in accordance with the purposes for its creation and are in
compliance with Resolution No R2013-14 and the guidelines and criteria adopted by the
City and all applicable law; and
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WHEREAS, the Improvements, as defined below, constitute a major investment
within the Reinvestment Zone that will substantially increase the appraised value of
property within the zone and will contribute to the retention or expansion of primary and
secondary employment within the City; and
WHEREAS, there will be no substantial adverse effect on the provision of city
services or on its tax base, and the planned use of the Premises will not constitute a
hazard to public safety, health, or welfare; and,
WHEREAS, but for the benefits provided through this Tax Abatement
Agreement, the Improvements as defined below would not be made in the City; and
WHEREAS, the Companies declare that they will be the sole beneficiaries of the
benefits provided through this Tax Abatement Agreement and that they will not share
any portion of the proceeds of the benefits received through this Tax Abatement
Agreement with any other party as compensation or award for consulting or other
services received by the Companies contingent upon the successful execution of this
Agreement;
THEREFORE: For and in consideration of the mutual agreements and
obligations set forth below, the sufficiency of which is hereby acknowledged by the
parties hereto, the Companies and the City mutually agree as follows:
1. PREMISES: The property subject to this Agreement shall be only that
property described by metes and bounds and map attached hereto as Exhibit "A" (the
"Premises").
2. CONFLICT OF INTEREST: The City represents and warrants that the
Premises does not include any property that is owned by a member of its council or
boards, agencies, commissions, other governmental bodies or employees approving, or
having responsibility for the approval of, this Agreement.
3. ABATEMENT: Subject to the terms and conditions of this Agreement,
and subject to the rights and holders of any outstanding bonds of the City, a portion of
ad valorem property taxes assessed to the Premises and certain Improvements only as
defined herein and otherwise owed to the City shall be abated. The City hereby
acknowledges that it is not aware of any terms or conditions of any outstanding bonds
which would invalidate this Agreement or would conflict with the provisions of this
Agreement. This Agreement shall be effective with the January 1St valuation date
immediately following the date of execution of this Agreement (the "Effective Date"). In
each year that this Agreement is in effect, the amount of abatement shall be an amount
equal to the percentage indicated below of the taxes assessed upon the increased
value of the Premises due to the Improvements defined herein, exclusive of future or
other capital investment made at the Premises not contemplated herein, over the
market value as of January 1st in the year in which this Agreement is executed. The
abatement as herein provided shall be for the following years and in the following
amounts: 1) Seventy -Five percent (75%) of the taxes assessed upon the increased
value of the Building, Fixed Machinery and Equipment and Fixed Improvements set
forth below exclusive of future or other capital investment made at the Premises,
annually for a period of four (4) years beginning January 1, 2016 and ending December
31, 2019; 2) Fifty percent (50%) of the taxes assessed upon the increased value of the
Building. Fixed Machinery and Equipment and Fixed Improvements set forth below
exclusive of future or other capital investment made at the Premises, annually for a
period of three (3) years beginning January 1, 2020 and ending December 31, 2022;
4. FUNDING CONDITIONS: The Companies must meet or cause to be met
all of the following: Lease Agreement, Capital Improvement and Job Creation conditions
described in (a), (b) and (c)below ("Funding Conditions"), or Companies shall be jointly
and severally liable for liquidated damages and/or repayment of abated taxes in
accordance with this Agreement:
a. Lease Agreement: Keystone and Pearland Building III shall execute
an agreement providing for the construction and lease of an approximately
45,000 sf headquarters and manufacturing facility ("Facility") on the
Premises. Keystone, as the tenant under the lease, shall maintain
operations at the Facility for the term of this Agreement.
b. Capital Improvements: Keystone and/or Pearland Building III shall
construct various improvements on the Premises, which when complete
shall have a minimum investment value of one million dollars five hundred
thousand ($1,500,000) for the real property and/or improvements ("Fixed
Improvements") and five hundred thousand dollars ($500,000) in other
"Ineligible Property" (i.e., personal property and inventory) which shall be
substantially complete on or before October 1, 2016; provided, that the
Companies shall have such additional time to complete the Improvements
as may be required in the event of "force majeure" (as set forth herein) if
the Companies are diligently and faithfully pursuing completion of the
Improvements. The date of completion of the Improvements (the
"Improvement Completion Date") shall be defined as the date a Final
Certificate of Occupancy is issued by the City.
c. Job Creation: Keystone shall create and retain a minimum of 70
"Employment Positions," as defined herein, in accordance with the
following schedule:
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Keystone shall demonstrate compliance with this Section by maintaining a
minimum of ninety five percent (95%) or more of the required Employment Positions at
the Premises for the entire duration of this Agreement. Employment Positions, for
purposes of this Agreement, shall only be counted if the number of Employment
Positions is greater than the total number of Employment Positions located at the
Facility when this Agreement is executed (the "Threshold"). For purposes of this
Agreement, the parties agree that the Threshold shall be zero because no Employment
Positions existed in the City prior to execution of this Agreement.
d. Employment Positions. For the purposes of this Agreement,
"Employment Positions" shall be defined as Keystone's jobs meeting
all of the following criteria:
1) New full-time employment positions (at least 2000
hours annually per employee) in the City that are
located at the Premises ; and
2) The Employment Positions must have an average
annual gross compensation of at least $40,000.00 per
year (excluding benefits); and
3) Medical benefits must be provided for each
Employment Position.
5. APPLICATION FOR TAX ABATMENT: Keystone agrees and covenants
that the information provided in the Application for Tax Abatement attached hereto as
Exhibit "B" is true and correct and that any materially false or misleading information
provided to applicable taxing jurisdictions shall be an event of default and grounds for
termination of this Agreement.
6. GOOD FAITH, COMPLIANCE AND CONSIDERATION: The Companies
agree and covenant that they will diligently and faithfully, in a good and workmanlike
manner, pursue completion of the Improvements as a good and valuable consideration
of this Agreement. The Companies further covenant and agree that all construction of
the Improvements will be in accordance with all applicable federal, state and local laws
and regulations or valid waiver thereof. In further consideration, Companies shall
thereafter, from the date a Final Certificate of Occupancy is issued until the expiration of
this Agreement, continuously operate and maintain the Premises and limit the use of
said Premises to that use which is consistent with the terms of this Agreement and the
general purpose of encouraging development or redevelopment of the Reinvestment
Zone during the period that this Agreement is in effect.
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7. ANNUAL COMPLIANCE VERIFICATIONS: No later than 60 days after
January 1, 2017, and continuing every year thereafter through 2023, Companies shall
deliver to the City an Annual Compliance Verification, in the form of Exhibit "C"
attached hereto, signed by a duly authorized representative of and Companies
certifying the following information:
a. the number Employment Positions created and maintained by Keystone
on the Premises, the general description the Employment Positions
existing as of December 31st of the preceding year and the wage
information for all Employment Positions; and
b. the appraised value, as determined by the Central Appraisal District, of the
Improvements as defined herein, supporting evidence that the
Improvements were constructed or installed on or before the
Improvements Completion Date and a general description of the
Improvements existing as of December 31st of the preceding year
There shall be a total of seven (7) Annual Compliance Verifications submitted to the City
in years 2017 through 2023. Each Annual Compliance Verification shall include specific
back-up information supporting the Employment Position data. Furthermore, all Annual
Improvement Compliance Verifications shall consist of a certified copy of the appraised
value of the Improvements as shown by the Central Appraisal District supported by all
correspondence, renditions, appeals or contests and settlement of appraised value and
shall provide appropriate back-up data for the Improvements exclusive of other
investments made at the Premises.
8. CERTIFICATION OF GOOD STANDING/DELINQUENT TAXES: By
execution of this Agreement, the Companies certify that they are companies in good
standing under the laws of the State in which they were formed or organized, and that
they have provided the City evidence of such. In addition, the Companies certify that
they owe no delinquent taxes to any taxing unit of the State of Texas, the City or any
other local tax levying political subdivision with jurisdiction to levy taxes in or on the
operations and property of the Companies at the Premises.
9. CERTIFICATION RELATING TO UNDOCUMENTED WORKERS: By
execution of this Agreement, the Companies, including any business, branch, division,
and department of the Companies, certify that they do not and will not knowingly employ
an undocumented worker (as defined by Texas Government Code Section
2264.001(4)). If after any abatement of taxes under this Agreement and during the term
of this Agreement, the Companies, or a business, branch, division, or department of the
Companies, is convicted of a violation under 8 U.S.C. Section 1324a(f), the Companies
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shall repay the amount of any funds abated plus interest at the rate of 8% per year. The
repayment shall be due and owing not later than the 120th day after the date of the
conviction without the requirement of notice from the City.
10. ACCESS TO PREMISES: The Companies further agree that the City, its
agents and employees shall have the right to enter upon the Premises at any
reasonable time to inspect the Improvements in order to determine whether the
construction of the Improvements is in accordance with this Agreement and all
applicable federal, state, and local laws, ordinances, and regulations or valid waiver
thereof. After completion of the Improvements, the City shall have the continuing right
to enter upon and inspect the Premises at any reasonable time during normal business
hours, after 24 hours notice has been given, to determine whether the Premises are
thereafter maintained and operated in accordance with this Agreement and all
applicable federal, state, and local law, ordinances, and regulations. The City shall
conduct at least one inspection annually to ensure compliance with the guidelines
contained in Resolution No. R2013-14. Notwithstanding any other provision of this
Agreement, if the City determines that a violation of a federal, state, or local law,
ordinance or regulation exists on the Premises, the City may, in addition to any other
authorized enforcement action, provide to the Companies written notice of such
violation. For the purposes of this Agreement, the Companies shall have thirty (30)
days from the date of the notice to cure or remedy such violation. If the Companies
refuse to cure or remedy the violation within such thirty (30) day period, the Companies
are subject to the forfeiture, at the discretion of the City, of any right to any tax
abatement for the period of such violation through to the end of the period covered by
this Agreement.
11. LIQUIDATED DAMAGES:
a. Funding Condition Targets. As set forth herein, during the term
of this Agreement, Keystone shall deliver to the City an Annual
Compliance Verification, signed by Keystone and Pearland Building III,
demonstrating compliance with the Funding Conditions of this Agreement
for the preceding year. If Keystone fails to timely provide an Annual
Compliance Verification or provides an Annual Compliance Verification
that demonstrates the Companies failed to meet a Funding Condition
target(s) for that year, then the City may, at its sole discretion and in
addition to all other remedies for the recapture of lost tax revenue
provided herein, require the Companies to pay liquidated damages up to
the amount of the abatement received for the year in which the
Companies did not meet the Funding Conditions.
b. General Provisions Related to Liquidated Damages: Liquidated
damages provided for herein shall be construed in accordance with
Section 312.205, Tax Code, V.A.T.S., as amended, and shall include all
taxes which otherwise would have been paid to the City without the benefit
of abatement (but without the addition of penalty; interest will be charged
at the statutory rate for delinquent taxes as determined by Section 33.01
of the Tax Code) and shall become a debt to the City and shall be due,
owing and paid to the City as liquidated damages subject to the expiration
of any cure period or the termination date, whichever is applicable. The
City shall retain all remedies for the recapture and collection of the lost tax
revenue as provided generally in the Tax Code for the collection of
delinquent property taxes and in accordance with Resolution No. R2013-
14. The Companies shall be jointly and severally liable to the City for any
liquidated damages contemplated herein.
12. DEFAULTS AND REMEDIES:
a. Each of the following occurrences, acts or omissions of Keystone
and/or Pearland Building III shall constitute an act of default of the
Companies under this Agreement:
1) The failure to meet the Capital Improvements Funding
Conditions by the Improvement Completion Date.
2) The failure to provide or submit Annual Compliance
Verification Report(s) as required by this Agreement.
3) The failure to meet any Capital Improvement or Job Creation
Funding Conditions of this Agreement.
4) The Companies allow their ad valorem taxes owed to any
taxing jurisdiction to become delinquent, and fail to timely
and properly follow the legal procedures for protest and/or
contest of any such ad valorem taxes.
5) Keystone terminates its lease of the facility.
b. In the event of a default of the terms of this Agreement, the City
shall provide the Companies written notice of such default, which notice
shall be delivered by personal delivery or certified mail to:
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William S. Ring
Keystone Engineering, Inc.
6310 Sydney Street
Houston, TX 77021
Mark Ring
Pearland Building III, Inc.
1424 N. Main Street
Pearland, TX 77581
c. If Keystone and/or Pearland Building III fail to satisfactorily cure a
default under this Agreement within thirty (30) days of the date of receiving
written notice to cure the default, this Agreement may be terminated by
the City at its discretion without further notice or liability to the Companies.
In the event Keystone and/or Pearland Building 111 fail to cure a default
within thirty (30) days of receiving such written notice to cure, the
Companies shall immediately refund to the City any amounts abated
under this Agreement, plus interest at the rate of 8% per year,
compounded annually from January 1 of the year in which the default
occurs ("Default Year") to the date of payment of the refunded taxes.
d. Keystone shall provide the City a written notice a minimum of thirty
(30) days before any of the Employment Positions or Improvements are
moved from the Premises that would result in a reduction below the then
required Employment Positions. In the event that Keystone shall move
any of the Employment Positions or Improvements required by this
Agreement from the Premises during the term of the Agreement, the City
in its sole discretion, may terminate this Agreement and require the
Companies to immediately refund, to the City, all or a portion of the taxes
previously abated under this Agreement , plus interest at the rate of 8%
per year, compounded annually from January 1 of the year following the
execution of this Agreement to the date of repayment.
e. All taxes abated herein shall be deemed due and owing to the City
at any point that Keystone and/or Pearland Building III cannot pay their
respective bills as they come due. If after Keystone and/or Pearland
Building III is no longer able to pay its bills as they come due, it files for
protection from its creditors by any chapter of the bankruptcy code, the
City may, at its discretion, pursue the abated taxes as a creditor in the
bankruptcy for unpaid property taxes subject to any and all tax liens
applicable thereto.
13. CITY AUDIT RIGHTS:
a. Duty to Maintain Records. The Companies shall maintain
adequate records to support its compliance with the terms of this
Agreement. The Companies shall also maintain such records as are
reasonably deemed necessary by the City and auditors of the City, or
such other persons or entities designated by the City, to ensure proper
accounting for all costs and performances related to this Agreement.
b. Records Retention. The Companies shall maintain and retain for
a period of four (4) years after the submission of the final Annual
Compliance Verification report, or until full and final resolution of all audit
or litigation matters which arise after the expiration of the four (4) year
period after the submission of the final Annual Compliance Verification
report, whichever time period is longer, such records as are necessary to
fully disclose the extent of services provided under this Agreement,
including but not limited to any daily activity reports and time distribution
and attendance records, and other records which may show the basis for
the calculation of full time positions.
c. Audit Trails. Appropriate audit trails shall be maintained by the
Companies to provide accountability for updates and changes to
automated personnel and financial systems. Audit trails maintained by the
Companies shall, at a minimum, identify the changes made, the individual
making the change and the date the change was made. An adequate
history of transactions shall be maintained by the Companies to permit an
audit of the system by tracing the activities of individuals through the
system. The Companies' automated systems provide the means whereby
authorized personnel have the ability to audit and establish individual
accountability for any action that can potentially cause access to,
generation of, or modification of information related to the performances of
this Agreement. The Companies agree that their failure to maintain
adequate audit trails and corresponding documentation shall create a
presumption that the performances were not performed.
d. Access. The Companies shall, upon reasonable advance notice,
grant the City, or such other persons or entities designated by City for the
purposes of inspecting, auditing, or copying such books and records,
access, during normal business hours on a not to interfere basis, to all
paper and electronic records, books, documents, accounting procedures,
practices or any other items relevant to the performance of this
Agreement,. All records, books, documents, accounting procedures,
practices or any other items relevant to the performance of this Agreement
shall be subject to examination or audit by City, or such other persons or
entities designated by City in accordance with all applicable state and
federal laws, regulations or directives. Keystone and/or Pearland Building
III will direct any subcontractor with whom it has established a contractual
relationship to discharge their obligation to likewise permit access to,
inspection of, and reproduction of all books and records of their
subcontractor(s) which pertain to this Agreement.
e. Location and Reimbursement. Any audit authorized herein shall
be conducted at the Premises during normal business hours and
conducted at City's expense and in a manner not to unreasonably
interfere with Keystone's or Pearland Building III business; provided all
reasonable costs incurred by City in conducting any such audit shall be
reimbursed by Keystone and/or Pearland Building III in the event such
audit reveals an aggregate discrepancy in any of the reporting of
compliance as required by this Agreement. If any audit or examination
reveals that the reports for the audited period are not accurate for such
period, then Keystone and/or Pearland Building III shall reimburse the City
in accordance with Section 11 of this Agreement.
f. Corrective Action Plan. If an audit reveals any discrepancies or
inadequacies which must be remedied in order to maintain compliance
with this Agreement, Keystone and/or Pearland Building III agree, within
thirty (30) calendar days after their receipt of the audit findings, to propose
and submit to the City a corrective action plan to correct such
discrepancies or inadequacies subject to the approval of the City. The
Companies further agree that the sole cost to complete the corrective
action shall be the responsibility of the Companies, and implementation
shall be within thirty (30) calendar days after the City approves the
corrective action plan.
g. Reports. Keystone and/or Pearland Building III shall provide to the
City periodic status reports in accordance with the City's audit procedures
regarding the their resolution of any audit -related compliance activity for
which they are responsible.
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14. REPORTS AND BRIEFINGS: In a manner consistent with the need to
protect privacy and the intellectual property of the Companies and third parties, the
Companies will provide periodic briefings as reasonably requested by the City on the
general activities, economic impact and progress of the new project development and
business operations in Texas.
15. USE AND RETENTION OF CITY CRAFTSMEN, TRADES AND
SUPPLIERS: Although not an event of default or a condition to this Agreement, the
City requests that the Companies satisfy its need for additional employees from City of
Pearland, Texas, residents and purchase all materials, supplies and services necessary
to affect the occupancy of the property from City of Pearland merchants and
businesses.
16. COMMUNITY INVOLVEMENT: Although not an event of default or
condition of any advance hereunder, the Companies agree 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 Pearland, Texas, and to actively encourage its
employees to be involved in such organization and/or activities.
17. FINANCIAL INFORMATION: The Companies shall furnish the City, if
requested, on an annual basis by February 28 of each year throughout the term of this
Agreement, information regarding the general business status, market and general
summary financial updates regarding the Companies.
18. INDEMNITY AND HOLD HARMLESS: THE COMPANIES HEREBY
AGREE TO RELEASE, ACQUIT, INDEMNIFY, AND HOLD HARMLESS THE CITY, ITS
OFFICERS, AGENTS, EMPLOYEES, SUCCESSORS, AND ASSIGNS, FROM ANY
AND ALL KINDS OF CLAIMS, DEMANDS, LOSSES, DAMAGES, INJURIES, RIGHTS,
CAUSES OF ACTION, OR JUDGMENTS OF WHATSOEVER CHARACTER OR
NATURE, INCLUDING ATTORNEYS' FEES, WHICH MAY ARISE AS A RESULT OF
ACTION OR OMISSION BY PEARLAND BUILDING III AND/OR KEYSTONE UNDER
THIS AGREEMENT. THE PROVISIONS OF THIS SECTION REFLECT THE
EXPRESSED INTENTIONS OF THE COMPANIES AND THE CITY AND SHALL
SURVIVE THE TERMINATION, EXPIRATION, OR CANCELLATION OF THIS
AGREEMENT.
19. EXPRESS NEGLIGENCE. THE INDEMNITY SET FORTH IN THIS
AGREEMENT IS INTENDED TO BE ENFORCEABLE AGAINST THE COMPANIES
AND THEIR SUCCESSORS AND ASSIGNS IN ACCORDANCE WITH THE EXPRESS
TERMS AND SCOPE HEREOF NOTWITHSTANDING TEXAS' EXPRESS
NEGLIGENCE RULE OR ANY SIMILAR DIRECTIVE THAT WOULD PROHIBIT OR
OTHERWISE LIMIT INDEMNITIES BECAUSE OF THE NEGLIGENCE (WHETHER
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SOLE, CONCURRENT, ACTIVE OR PASSIVE) OR OTHER FAULT OR STRICT
LIABILITY OF THE CITY.
20. GENERAL PROVISIONS
a. Authority. Each party represents that it has obtained all necessary
authority to enter into this Agreement.
b. Relationship of Parties and Disclaimer of Liability. The parties
will perform their respective obligations under this Agreement as
independent contractors and not as agents, employees, partners, joint
ventures, or representatives of the other party. Neither party can make
representations or commitments that bind the other party. The Companies
are not a "governmental body" by virtue of this Agreement or the City's
granting of an abatement.
c. Limitation of Liability. In no event will either party be liable to the
other party for any indirect, special, punitive, exemplary, incidental or
consequential damages. This limitation will apply regardless of whether or
not the other party has been advised of the possibility of such damages.
d. Term. The term of this Agreement commences on the Effective
Date of this Agreement and continues until December 31, 2023 unless
terminated earlier pursuant to the terms of this Agreement.
e. Termination for Cause. Either party may terminate this
Agreement for Cause upon thirty (30) days prior written notice to the other
party. "Cause" is any failure to perform a material obligation under this
Agreement within the specified time; including the Companies' failure to
comply with any Funding Conditions contained herein. The sole remedy
for any termination for Cause (and for the "cause" giving rise to the
termination) shall be that each party is relieved of its obligation to perform
hereunder; however, following termination by the City, the Companies will
continue to be obligated to the City for liquidated damages and/or
repayment of abated taxes in accordance with applicable provisions of this
Agreement.
f. Dispute Resolution and Applicable Law.
1) Informal Meetings. The parties' representatives will meet as
needed to implement the terms of this Agreement and will make
a good faith attempt to informally resolve any disputes.
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2) Applicable Law and Venue. This Agreement is made and
entered into in the state of Texas, and this Agreement and all
disputes arising out of or relating thereto shall be governed by
the laws of the state of Texas, without regard to any otherwise
applicable conflict of law rules or requirements. The Companies
agree that any action, suit, litigation or other proceeding
(collectively "litigation") arising out of or in any way relating to
this Agreement, or the matters referred to therein, shall be
commenced exclusively in the State of Texas in any court with
proper jurisdiction to hear this matter closest to the City Hall of
the City of Pearland, and hereby irrevocably and unconditionally
consent to the exclusive jurisdiction of those courts for the
purpose of prosecuting and/or defending such litigation. The
Companies hereby waive and agree not to assert by way of
motion, as a defense, or otherwise, in any suit, action or
proceeding, any claim that (a) the Companies are not personally
subject to the jurisdiction of the above-named courts, (b) the
suit, action or proceeding is brought in an inconvenient forum or
(c) the venue of the suit, action or proceeding is improper.
21. MISCELLANEOUS PROVISIONS
a. Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original,
and it shall not be necessary in establishing proof of this Agreement to
produce or account for more than one such counterpart.
b. Merger. This document constitutes the final entire agreement
between the parties and supersedes any and all prior oral or written
communication, representation or agreement relating to the subject matter
of this Agreement.
c. Severability. Any term in this Agreement prohibited by, or unlawful
or unenforceable under, any applicable law or jurisdiction is void without
invalidating the remaining terms of this said Agreement. However, where
the provisions of any such applicable law may be waived, they are hereby
waived by either party, as the case may be, to the fullest extent permitted
by the law, and the affected terms are enforceable in accordance with the
parties' original intent.
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d. Survival of Promises. Notwithstanding any expiration, termination
or cancellation of this Agreement, the rights and obligations pertaining to
payment or repayment of abated taxes and/or liquidated damages,
confidentiality, disclaimers and limitation of liability, indemnification, and
any other provision implying survivability will remain in effect after this
Agreement ends.
e. Binding Effect. This Agreement and all terms, provisions and
obligations set forth herein shall be binding upon and shall inure to the
benefit of the parties and their successors and all other state agencies and
any other agencies, departments, divisions, governmental entities, public
corporations and other entities which shall be successors to each of the
parties or which shall succeed to or become obligated to perform or
become bound by any of the covenants, agreements or obligations
hereunder of each of the parties hereto.
f. Successors and Assigns/Notice. The terms and conditions of
this Agreement are binding upon the successors and assigns of all parties
hereto. This Agreement may be transferred or assigned by the
Companies only upon written permission by the City in accordance with
Resolution R2013-14, which permission shall not be unreasonably
withheld. No assignment shall be approved if the assignor or assignee is
indebted to the City for ad valorem taxes or other obligations. The
Companies, or any legal successor thereto or prior assignee thereof, may
assign its rights and obligations under this Agreement, including by
merger or operation of law, to any legal successor or any person or entity
that acquires all or substantially all of its business and operations. In
addition, with the prior written consent of the City, which consent shall not
be unreasonably withheld or delayed, the Companies, or any legal
successor to the Companies or prior assignee thereof, may assign its
rights and obligations under this Agreement to any parent or wholly owned
subsidiary that it currently has in place or later establishes, if it is
constituted as a separate legally recognized business entity. Any such
assignment will be made without additional consideration being payable to
the City. This Agreement shall survive any sale, change of control or
similar transaction involving the Companies, any successor thereto or
prior assignee thereof and no such transaction shall require the consent of
the City. The Companies shall provide the City written notice of any
assignment, sale, change of control or similar transaction pursuant to this
section as soon as possible and in no event not later than thirty (30)
calendar days following such event.
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g. Force Majeure. Neither party shall be required to perform any
obligation under this Agreement or be liable or responsible for any loss or
damage resulting from its failure to perform so long as performance is
delayed by force majeure or acts of God, including but not limited to
strikes, lockouts or labor shortages, embargo, riot, war, revolution,
terrorism, rebellion, insurrection, flood, natural disaster, interruption of
utilities from external causes.
h. Notice. All notices, requests, demands and other communications
will be in writing and will be deemed given and received (i) on the date of
delivery when delivered by hand or via electronic mail, (ii) on the following
business day when sent by confirmed simultaneous telecopy and (iii) on
the following business day when sent via overnight courier (e.g., Federal
Express).
22. AGRICULTURAL VALUATION: It is understood and agreed by the City
and the Companies that if the Premises has been designated and taxed as agricultural
land pursuant to Chapter 23, Subchapter C, Tax Code, V.A.T.S., this Agreement shall
not be effective and no abatement granted until the Companies has removed the
agricultural use designation and all taxes due pursuant to Section 23.55, Tax Code,
V.A.T.S., as amended, (roll back taxes) have been paid.
23. CITY AUTHORIZATION: This Agreement was authorized by Resolution
of the City Council at its council meeting on the 27th day of Novemberr, 2014,
authorizing the City Manager to execute the Agreement on behalf of the City.
15
Witness our hands this"-- day of 11126.2% ,
CITY
By:
APPROVED AS TO FORM:
By:
rrin M. Coker
City Attorney
16
ear on
ity Manag
KEYSTONE ENGINEERING, INC.
By:
William S. Ring
President
PEARLAND BUILDING III, INC.
By: ./� /Z
Mark Ring
President
THE STATE OF TEXAS
COUNTY OF BRAZORIA
BEFORE ME, the undersigned Notary Public, on this day personally appeared
Clay Pearson, City Manager for the City of Pearland, known to me to be the person
whose name is subscribed to the foregoing instrument and acknowledged to me that he
executed the same for the purposes and consideration therein expressed.
rid
1` GIVENUNDERMY HAND AND SEL OF OFFICE THIS DAY OF
/1)e -e- /-�vt(- , A.D., 20 /( .
REBECCA& BOWERY
NOTARY PUBLIC
STATE OF TEXAS
My COMMieefon Expires 01-10-2017
THE STATE OF -T&&IL S
NOTARY PUBLIC STATE OF TEXAS'
Printed Name: el 11x fh2,;y
Commission Expires: IV- J 7
COUNTY OF rctzO✓LO
BEFORE ME, the undersigned Notary Public, on this day personally appeared
William S. Ring, Keystone Engineering, Inc., known to me to be the person whose name
is subscribed to the foregoing instrument and acknowledged to me that he executed the
same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE THIS 2 DAY OF
NOVev , A.D., 20 141- .
° _••;,� ,,,, MADISON K. OTTEN
e'
_.,• i� ,� Notary Public, State of Texas
%N ; My Commission Expires
May 17, 2015
84767895.2
85143582.2
Otte
NOTARY PUBLIC, STATE OF-NEbett-JERSEY T X04cS ryt,r_O
Printed Name: Mact iapn
Commission Expires: 05-17 - ZO15
THE STATE OF TEXAS 1
COUNTY OF BRAZORIA
BEFORE ME, the undersigned Notary Public, on this day personally appeared
Clay Pearson, City Manager for the City of Pearland, known to me to be the person
whose name is subscribed to the foregoing instrument and acknowledged to me that he
executed the same for the purposes and consideration therein expressed.
1� GIVEN UNDER MY HAND AND SE L OF OFFICE THIS as DAY OF
-Q62,,rh .it- , A.D., 20/
,,-/. REBECCAA.BOWERY
i .� NOTARY PUBLIC NOTARY PUBLIC STATE OF TIE�Q� STATE aazofl Printed Name: {j:p" ' '
c_,• Mp Camibelon E�piros 01 7�e���'P } , �/ z'<
- Commission Expires: D/ / /7a •' C •; ,-•
-
•
THE STATE OF -Tea S 1
COUNTY OF rCtZ.Ovia,
BEFORE ME, the undersigned Notary Public, on this day personally appeared
William S. Ring, Keystone Engineering, Inc., known to me to be the person whose name
is subscribed to the foregoing instrument and acknowledged to me that he executed the
same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE THIS 2S DAY OF
NOVexmlo,e'Y , A.D., 20 14- .
11=s,toulr,,,„ ADISON K.OVENn -/Public,State of Texasommi7ssio�fn ExpiresNOTARY PUBLIC, STATE OF XkS phr_Q• May 17,2015Printed Name: Madison K . 04k-n
Commission Expires: 05-17- Z015
84767895.2
85143582.2
•
THE STATE OF -1-6Va-S
COUNTY OF 12tr42,01c1A.)
BEFORE ME, the undersigned Notary Public, on this day personally appeared
Mark Ring, Pearland Building III, Inc. known to me to be the person whose name is
subscribed to the foregoing instrument and acknowledged to me that he executed the
same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE THIS 26 DAY OF
/00Vern Li•e4 , A.D., 20 .
••""
4014.7,N. MADISON K. OTTEN
)71/adeia-- < 1011AL-)
f*,.:*n. Notary Public,State of Texas
10§1 My Commission Expires NOTARY PUBLIC, STATE OF .
May 17, 2015 •.••• f • t,
Printed Name: tilact( ii V 7144C-ii •
Commission Expires: a_5-/7-2-ot6'
84767895.2
85143582.2
Exhibit "A"
PREMISES
Property Description
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Exhibit "B"
APPLICATION FOR TAX ABATEMENT IN THE CITY
84767895.2
85193582.2
APPLICATION FOR TAX ABATEMENT IN THE
CITY OF PEARLAND
It is recommended that this application be tiled at least 90 days prior to the beginning of construction or the installation
of equipment. The tiling of this document acknowledges familiarity and conformance pith Guidelines and Criteria for
Granting Tax Abatement in a Reinvestment Zone Created in the Cite of Pearland. This application will become part of
the agreement and any knowingly false representations will be grounds for the City to void the agreement. Original copy
of this request should be submitted to the Pearland Economic Development Corp. President, 1200 Pearland Parkway,
Suite 200, Pearland, Texas 77581, 281.997.3000, www'.pearlandedc.com. Please attach exhibits and additional
information.
Applicant Information
Name of Business: Keystone Engineering Group, Inc. Date: 8-12-2014
Address: 6310 Sidney Street
Cirv: Houston
State: TX Zip: 77021
Contact Person: Mark Ring Title: In House Counsel
Phone: 281-997-3300
Fax: 281-997-1300 Email: raring@kemlon.com
.\.\ICS Codes for primary business operations: 9015900000
Federal ID Number:
Does the Business file a consolidated tax return under a different tax ID number? ❑ les No
If yes, please also provide that rax ID number: 74-1367897
What is your State of Texas tax ID munber:
Is the contact person listed above authorized to obligate the Business?
❑ Yes ®No
If no, please provide the name and urle of a company officer authorized to obligate the Business:
1) John Ring, Vice -President
2) William S. Ring, President
Business Information
Provide a brief description and history of the Business. lnclude information about the Business' products or services
and markers served.
Custom manufacturing and composite fabrication.
Business Strucrure:
❑ Cooperative ❑ Corporation
❑ Partnership S -Corporacion
❑ Limited Liability Company ❑ Not for Profit
❑ Sole Proprietorship
State of Incorporation: Texas fears in business: 64
Identify the Business' owners and percent ownership: John Ring (1/3), Russell Ring (1/3), William Ring (1/3)
Annual Sales (Yost Recent): $(2013) 36,74-1,815
Projected -Dotal Sales: Year 1: $39,000,000 Year 2: $42,000,000 Year 3:
S45,000,000
How- many employees are currently employed bt the Business including all locations, subsidiaries, divisions worldwide?
List the Business' Texas locations and the Current Number of full-time equivalent (FIE) Employees at each Location
(including Pearland if applicable): 174 employees, locations in Houston and Engle, TX
Current annual payroll of Pearland facility excluding any benefits (if applicable): $11
Docs the Business offer medical and dental insurance?
If yes, please describe.
® Yes ❑No
Does the Business offer a pension plan, 401(k) plan, and/or retirement -plan? 2 Yes ❑ No
If yes, please describe.
Please provide a brief description of the Business' involvement w the community(ies) that it has locations.
Keystone actively hires personnel from available communities in which it operates regularly. In addition, Keystone
strives to buy locally- whenever possible. Keystone is a supporter of the Chamber of Commerce, sponsors various youth
sports, and offers internships to local students interested in engineering or manufacturing.
Project Information
Location and legal description of the arca to be designated as reinvestment zone (Provide map showing site and metes
and bounds description in attachment .A5): 1509 N. Main Street
Type of Business Project:
® New Location
❑ Expansion of Pearland Fa '0
❑ Modernization of Existing Pearland Facility
Type of Facility:
\tanufacruring ❑ Reg. Distribution Center
❑ Regional Service ❑ Reg. Entertainment Center
❑ Other Basic Industry
Briefly describe the proposed project for which assistance is being sought. (Include project facility size, infrastntcture
improvements, proposed products/services, any new markets, etc.) Keystone is looking to relocate its headquarters
and operations to a state of the art office and manufacturing floor. The initial project will likely house
approximately 10.000 sq ft of office and flex space and an additional 35,000-40,000 sq ft of manufacturing.
Consolidating multiple sites in one building will increase productivity and efficiency and allow our customers to see
all the various capabilities of Keystone in one place.
1- as any part of the project started? Fes ❑ \o
If yes, please explain. Contract to purchase land
Identify the Business' competitors. If any of these competitors have Pearland locations, please explain the nature of the
competition (e.g. competitive business segment, estimated market share, etc.) and explain what impact the proposed
project may have on rhe Pearland competitor.
Will any of the current Pearland employees lose their jobs if this project does not proceed in Pearland? (F. sting
Pearland Companies only) ❑ Fes ❑ No
If yes, please explain win- and identify those jobs as "retained jobs" in the Project Jobs section.
N/A
Is the Business actively considering locations outside of Pearland? Fes ❑ No
If yes, where and what assistance is being offered?
Pursuing Pearland first.
Will am- State or Federal Permits he needed for the project? ❑ Fes
If res, please describe each and current rime -frame for receivinf
Will the project be seeking I.EED certification? ❑ Fes No
If yes, what level of certification is being sought:
® No
-ach?
Project Jobs
List the jobs that will be created and/or retained as the result of this project. (.\ retained job is an existing job that would
be eliminated or moved to another location if the project does not proceed in Pearland.) For jobs to he created, include
the starting and final hourly wage rate. For retained jobs, include the current hourly wage rate.
Is the hourly wage rate based on a 40 hour work week, 52 weeks per year% ❑ Yes ®.No
lino please explain: \\'age is based on prior 12 months of actual payroll.
Full -Tune CREATED )ohs
(Add addirional rows
as needed)
StartingWage
Wage at End of
Year "Three
Job 'fide/Classification
lassitication
Number of
CRE-ATIiD
)obs
Office and Manatzers
9
$
Machinist/ Inspectors
61
$
$
$
$
$
s
$
$
$
$ I$
s
$
$
$
$
$
$
$
Total RET TINED Johs
$
$
$
$
Total CRE.V1ED Johs
70
$1950/average
$
Full -Time RETAINED Jobs'
(_Add additional rows as needed)
Job Title/Classification
cumber of
RETAINED dohs
Current Wage
$
$
$
$
$
$
$
Total RET TINED Johs
$
ting j< bs based in Pearland
Tax Abatement Information
Description of eligible improvements (real property) to he constructed including fixed equipment fixed equipment,
buildings, parking lots, etc (Protide detail in attachment A6):
Manufacturing and office building with associated site unprovements.
Description of ineligible property to be included in project, including inventory and personal property:
The proposed reinvestment zone is located in:
County: Brazoria
Drainage District: Brazoria County Drainage Distract #4
School District: Pearland ISD
College District: None
Other Taxing (unsdictions: None
t\ hat is the parcel(s) tax identification numher(s)?: 56'(123
Tax Abatement Requested: "'o of eligible property for a term of years (or)
requesting staggered tax abatement ternis as follows: staggered as acceptable to city.
Is the applicant seeking a variance under Section 3 (I) of the Guidelines: Yes ❑ No N
If yes, attached required supplementary information in 'attachment A8.
l -{as company made application for abatement for this project by another taxing jurisdiction or nearby counties:
Yes ❑ No
If yes, provide dates of application, hearing dates, if held or scheduled, name of jurisdictions and contacts, and
letters of intent.
Constriction Estimates
Commencement Date:
Constntction AIan Years:
Completion Date:
Peak Construction fobs:
li4/01 2015 If NIodernization
Estimated Economic Life of Existing Plant in years:
04/01/2016 Added Economic Life from _Modernization in years:
25?
2014 APPRAISED BASE VALUE ON SITE
ESTIMATED VALUE OF NEW
VALUE ADDED
Land
S100
Land
$543,765
Building and Improvements
$
Fixed Improv>enments
$3,866,060
Fixed Equipment
$
$
FixedMachinery Equipment
Personal Property
$
$1,785,124
Personal Property
Inventory
$
Inventory
$935,569
Total of Pre-existing Value
$
Total of New Value Added
$7,130,518
Total Value of Pre-existin
and New Value
$100
Project Budget
AMOUNTS BUDGETED
Use of Funds
Cost
Source
Commitment Status
Land Acquisition
543,765
Site Preparation
1,116 060
Cost of Utilities to Site
Included in site prep
Building Acquisition
Building Construction
2,750,()00
Btulding Remodeling
Machinery & Equip.
1,785,124
Owned, to be moved
Computer Hardware
20,OOf)
Owned, to be moved
Computer Software
75,000
Owned, to be moved
Furniture & Fixtures
TBD
Cash
Working Capital
Moving Expenses
200.000
Job I raining
TOTAL
6,489,949
Does the Business plan to lease the facility? ❑ Yes ❑ No
If yes, please provide the Annual Base Rent payment (lease payment minus property taxes, insurance, and
operating/maintenance expenses) and the length of the lease agreement.
Financial assistance is need -based, please explain why assistance is needed:
Any recipient of tax abatement is expected to provide security to the City. The security will be exercised, when
necessary, due to non-performance. In addition to a lien and/or mortgage, personal guarantees are expected for
businesses not publicly traded, and corporate guarantees are expected when the business recipient has a parent (or
holding) company. AX11at security will be offered to secure financial assistance and describe what seniority or position
the Cin- will have on any lien or mortgage?
Attachments
Please attach the following documents:
Al Completed Economic Itnpact Data Sheet (If requested)
A2 Business Plan (If requested)
A3 Copy of the most recent payroll report for one pay- period must be in Excel format and include the following
information:
• Company name, date of payroll and source of payroll information
• Employee name and/or employee identification number
• Current hourly wage - do not include bonuses or other benefit values
• Indicate if the employee is full time (40 hours per week, 52 weeks per year) or part time.
A4 Financial Information
• Audited profit and loss statements and balance sheets for past three tear -ends;
• Current YTD profit and loss statement and balance sheet; and
• Schedule of aged accounts receivable;
• Schedule of aged accounts payable; and
• Schedule of debts.
A5 \lap showing boundaries of proposed site.
A6 Statement explaining general nature and extent of the project, describing existing site and improvements;
describe all proposed improvements and provide a list of all improvements and equipment for which
abatement s requested.
A7 Proposed timeline for undertaking and completing the planned implements.
A8 Variance Request (if applicable)
Certification & Release of Information
1 hereby give permission to the City of Pearland and the Pearland Economic Development Corporation (PFIDC) to
research the Business' history, make credit checks, contact the Business' financial institutions, insurance carriers, and
perform other related activities necessary for reasonable evaluation of this application.
i understand that all information submitted to the City and PE1)C related to this application is subject to Texas Public
Information Act.
I understand this application is subject to final approval by die City of Pearland City Council and the Project may not he
initiated until'frnal approval is secured.
I understand that the City reserves the right to negotiate the financial assistance. Furthermore, I am aware that tax
abatement is not available until an agreement is executed within a reasonable time period following approval.
I certify the Business has not, within the last five years, been cited or convicted for violating any state or federal statutes,
rules, and regulations, including environmental, worker safety and immigration regulations, or, if such violations have
occurred, that there were mitigating circumstances or such violations did not seriously affect public health or safety or
the environment.
I hereby certify that all representations, warranties, or statements made or furnished to the City and PEDC in
connection with this application are true and correct in all material respect. 1 understand that it is a violation under Texas
law to engage in deception and knowingly make, or cause to he made, directly or indirectly, a false statement in writing
for the purpose of procuring economic development assistance.
For the Business:
Signature
1A (x rvsei
Name and Title (hyped or printed)
Dare
INSTRUCTIONS
Applicants and projects must meet the requirements established by the Cin- of Pearland Guidelines rind crilena jOr Granting
!aa Abatement in a Reinnestmen1 Zone found in Resolution No. 82011-12 (attached) in order to receive positive
consideration. Section 2 of the Guidelines, for example, sets out regulations governing eligible facilities, eligible and
ineligible improvements, terms and economic qualifications. Conlommancc with all sections, however, is required for
eligibihn-.
APPLICANT INFORMATION
The taxing unir may consider applicant financial capacity w determining whether to enter into an abatement agreement.
Established companies for which public information is available, or the wholly owned businesses of such companies,
should include with the application a copy of their latest annual report to stockholders. Other applicants and new
companies should attach a statement showing when the company was established, business references (name, contact
and telephone number of principal bank, accountant and attorney) and may be required to submit an audited financial
statement and business plan.
PROJECT INFORMATION
Only facilities listed in Section 2(a) of the Guidelines may receive abatement without applying for a variance. Check
guideline definitions in Section 1 to sec if project qualifies.
TAX ABATEMENT INFORMATION
Estimated appraised Value on Site - The value as of January 1 immediately preceding abatement should he the value
established by the :Appraisal District. If the applicant must estimate value because the taxable value is not known or is
combined with other properties under a single tax account, please so state. Projections of value should be a "best
estimate" based on taxability in Texas. The projection of project values not abated should include personal property and
ineligible project -related improvements such as office space in excess of that used for plant administration, housing, etc.
EXHIBIT "C"
FORM OF ANNUAL EMPLOYMENT COMPLIANCE VERIFICATION
ECONOMIC DEVELOPMENT CORPORATION
CITY OF PEARLAND
TAX ABATEMENT ANNUAL INVESTMENT AND EMPLOYMENT
COMPLIANCE VERIFICATION
Verification should be submitted to the Pearland Economic Development Corporation President, 1200 Pearland
Parkway,Suite 200,Pearland,Texas 77581,281.997.3000,www.pearlandedc.com. Please attach exhibits and additional
information.
•
Company Information
Name of Business: Date:
Address:
City: State: Zip:
Contact Person: Title:
Phone: Fax: Email:
Annual Compliance Verification
Please check the box that applies:
❑ First Time Filing
❑ Subsequent Filing
If subsequent,date last compliance submitted:
Report Covers Period: Begin Date: End Date:
This is compliance of .
1
Employment-Position Information
All positions must be full-time(2,000 hours or more annually)and permanent,with the Company.
1. Total Number of Employment Positions Reported(previously certified and new):
2. Total Number of Employment Positions Previously Certified:
3. Total Number of New Employment Positions Submitted for Certification(line 1—line 2):
4. Total Payroll for all Employment Positions Reported this Claim Period: $
5. Average annual gross compensation at this Company/Project Facility(line 3/line 4):
Did the Company meet the"Job Target"for this reporting period? ❑Yes ❑No
If no,please explain why:
Does the Company provide medical and dental benefits to all employees? ❑Yes ❑No
•
Investment Information
1. Total new value previously certified:
2. Total new value submitted for certification this claim period:
3. Total value reported(previously certified and new line 1 and 2):
Generally describe the improvements existing as of December 31 of the preceding year?
Did the Company install or construct all improvements before the Improvements Completion Date? ❑Yes ❑No
If no,please explain why:
TAXABLE VALUE ON SITE 20_ORIGINAL TAX TOTAL INCREASE
BASE VALUE YEAR 20 OVER 20 BASE
Land $ $ $
Building and Improvements $ $ $
Fixed Equipment $ $ $
Personal Property $ $ $
Inventory $ $ $
Total Value $ $ $
Please attach the Business Personal Property Rendition form submitted to the Appraisal District.
2
Attachments
Please attach the following documents:
Al Employment Verification
A2 Certified copy of the appraised and settled value of the Improvements as shown by the appropriate Central Appraisal
District supported by all correspondence, renditions, appeals or contests and settlement of appraised value and shall
provide appropriate back-up data for the Improvements exclusive of other investments made at the Premises.
A3 Business Personal Property Rendition of Taxable Property Form
Certification
I certify the appraised value of the improvements as defined in our agreement with the City of Pearland.
I certify the Business has not, within the reporting period, been cited or convicted for violating any state or federal
statutes, rules, and regulations, including environmental, worker safety and immigration regulations
Under penalty of perjury, I declare that the information in this document and any attachments are true and correct to the
best of my knowledge and belief.
For the Business:
Signature Date
Name and Title (typed or printed)
3
ANNUAL EMPLOYMENT COMPLIANCE VERIFICATION
Job Certification Period: January 1,
ABC Company
114 Oak Drive
Bluebonnet, Texas 77777
ABC Company, Inc.
Project Approved: 10/23/98
2000 through December 31, 2000
Job No.
Position Title
Social
Employee
Wages
Hours
Date Hired to
City of
Security
Name
During Claim
Worked
Position/Date
Pearland
Number
Period
During Claim
Left Position
Resident
Period
PREVIOUSLY CERTIFIED JOBS (updated):
001 Division ###-##-#### Dennis
Director Director
002 Office
Manager
002A
###-##-####
$68,987
Mary Worker $15,236
###-##-11### Lindsey
Sellsmith
NEW JOBS THIS CERTIFICATION:
003 Sales ###-##-####
Manager
004 Print Shop
Manager
Delores
Incharge
$12,008
$29,695
###-##-#### Adam $32,450
Typeset
Total Jobs Created: 4
Total Payroll: $/ttttt,�tittt
Vacant Positions: 0
TOTAL # OF JOBS ON THIS PAGE 4
PAGE # 1 of 1
TOTAL # OF JOBS ON THIS CLAIM 4
4
2,318
1,200
09/01/98 to
Present
01/15/98 to
8/31//98
900 9/1/98 to
Present
2,080
2,056
09/01/99 to
Present
09/01/99 to
Present
N
Y
Y
N
Y
•
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA §
FORT BEND,AND HARRIS §
LOAN AGREEMENT
Borrower: KEYSTONE ENGINEERING GROUP,INC.
a Texas S-Corporation
6310 Sydney Street
Houston,Texas 77021
Lender: PEARLAND ECONOMIC DEVELOPMENT CORPORATION
a Texas non-profit corporation
1200 Pearland Parkway, Suite 200
Pearland,Texas 77581
This LOAN AGREEMENT between KEYSTONE ENGINEERING GROUP, INC. , a
Texas S-Corporation (hereinafter referred to as `Borrower"), and the PEARLAND
ECONOMIC DEVELOPMENT CORPORATION, a Texas non-profit corporation, is made and
executed on the following recitals,terms and conditions.
WHEREAS, the Pearland Economic Development Corporation (hereinafter referred to
as the "Lender") is a Type B economic development corporation, created pursuant to Chapter
505 of the Texas Local Government Code,as amended; and
WHEREAS, Section 501.101 of the Texas Local Government Code, in pertinent part,
defines the term "project" to mean "land, buildings, equipment, facilities, expenditures, targeted
infrastructure, and improvements that are: (1) for the creation or retention of primary jobs; and
(2) found by the board of directors to be required or suitable for the development, retention, or
expansion of: (A) manufacturing and industrial facilities; (B) research and development
facilities; (C) military facilities, including closed or realigned military bases; . . . (F) recycling
facilities; . . . (I) distribution centers; (J) small warehouse facilities capable of serving as
decentralized storage and distribution centers; (K) primary job training facilities for use by
institutions of higher education; or(L) regional or national corporate headquarters facilities"; and
WHEREAS, Section 501.158 of the Texas Local Government Code prohibits the
provision of a direct incentive unless Lender enters into an Agreement with Borrower providing
at a minimum a schedule of additional payroll or jobs to be created or retained by Lender's
investment; a schedule of capital investments to be made as consideration for any direct
incentives provided by Lender to Borrower; and a provision specifying the terms and conditions
Lender's loan advances by Borrower or its agents and employees; (ii) any administrative or
investigative proceeding by any governmental authority directly or indirectly related, to a
claim, demand, action or cause of action in which Lender is a disinterested party; (iii) any
claim, demand, action or cause of action which directly or indirectly contests or challenges
the legal authority of Lender or Borrower to enter into this Agreement; and (iv) any and all
liabilities, losses, costs, or expenses (including reasonable attorneys' fees and
disbursements) that any Indemnitee suffers or incurs as a result of any of the foregoing;
provided, however, that Borrower shall have no obligation under this Section to Lender
with respect to any of the foregoing arising out of the gross negligence or willful
misconduct of Lender or the breach by Lender of this Agreement. If any claim, demand,
action or cause of action is asserted. against any Indemnitee, such Indemnitee shall
Lender's loan advances by Borrower or its agents and employees; (ii) any administrative or
investigative proceeding by.any governmental authority directly or indirectly related, to a
claim, demand, action or cause of action in which Lender is a disinterested party; (iii) any
claim, demand, action or cause of action which directly or indirectly contests or challenges
the legal authority of Lender or Borrower to enter into this Agreement; and (iv) any and all
liabilities, losses, costs, or, expenses (including reasonable attorneys' fees and
disbursements) that any Indemnitee suffers or incurs as.a result of any of the foregoing;
provided, however, that Borrower shall have no obligation under this Section to Lender
with respect to any of the foregoing arising out of the gross negligence or willful
misconduct of Lender or the breach by Lender of this Agreement. If any claim, demand,
action or cause of action is asserted against any Indemnitee, such Indemnitee shall
promptly notify Borrower, but the failure to so promptly notify Borrower shall not affect
Borrower's obligations under this . Section unless such failure materially prejudices
Borrower's right to participate in the contest of such claim, demand, action or cause of
action, as hereinafter provided. If requested by Borrower in writing, as so long as no
Default or Event of Default shall have occurred and be continuing,such Indemnitee shall in
good faith contest the validity, applicability and amount of such claim, demand, action or
cause of action and shall permit Borrower to participate in such contest. Any Indemnitee
that proposes to settle or compromise any claim, demand, action, cause of action or
proceeding for which Borrower may,be liable for payment of indemnity hereunder shall
give Borrower written notice of the terms of such proposed settlement or compromise
reasonably in advance of settling or compromising such claim or proceeding and shall
obtain Borrower's concurrence thereto.
SECTION 11. BORROWER'S REPRESENTATIONS.
By execution hereof, the signators warrant and represent that they have the requisite
authority to execute this Agreement and the Related Documents and that the representations
made herein, and in the Related Documents, are true and accurate in all respects.
SECTION 12. MISCELLANEOUS PROVISIONS.
The following miscellaneous provisions are a part of this Agreement:
(a) Amendments. This Agreement, together with any Related Documents, constitutes the
entire understanding and agreement of the parties as to the matters set forth in this
Agreement. No alteration of or amendment to this Agreement shall be effective unless
given in writing and signed by the party or parties sought to be charged or bound by the
alteration or amendment.
(b) Applicable Law and Venue. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas,and all obligations of the parties created
hereunder are performable in Brazoria County, Texas. Venue for any action arising
under this Agreement shall lie in the state district courts of Brazoria County, Texas.
Page 9 of 25
Loan Agreement
Pearland Economic Development Corporation . .
11/12/2014 12:15:58 PM
(c) Audit. Borrower shall furnish Lender a copy of Borrower's annual audited financial
statements and Borrower's records, documents, agreements and other instruments for the
following purposes: (i) to ensure Borrower's compliance with the affirmative covenants
set forth in Section 4 of this Agreement; and (ii) to determine the existence of an Event of
Default set forth in Section 7 of this Agreement. The Borrower shall maintain such
records as are deemed necessary by the Lender and auditors of Lender, or such other
persons or entities designated by Lender, to ensure proper accounting for all costs,
performances, sales tax information, and number of jobs created or retained related to this
Agreement. The Borrower shall grant access to all paper and electronic records, books,
documents, accounting procedures, practices or any other items relevant to the
performance of this Agreement to Lender, or such other persons or entities designated by
Lender for the purposes of inspecting, auditing, or copying such books and records. All
records, books, documents, accounting procedures, practices or any other items relevant
to the performance of this Agreement shall be subject to examination or audit by Lender,.
or such other persons or entities designated by Lender in accordance with all applicable
state and federal laws, regulations or directives. The Borrower will direct any
subcontractor with whom it has established a contractual relationship to discharge the
Borrower's obligations to likewise permit access to, inspection of, and reproduction of all
books and records of the Borrower's subcontractor(s)which pertain to this Agreement.
(d) Binding Obligation. This Agreement shall become a binding obligation on the
signatories upon execution by all signatories hereto. Borrower warrants and represents
that the individual or individuals executing this Agreement on behalf of Borrower has full
authority to execute this Agreement and bind Borrower to the same. Lender warrants and
represents that the individual executing this Agreement on its behalf has full authority to
execute this Agreement and bind it to the same.
(e) Caption Headings. Caption headings in this Agreement are for convenience purposes
only and are not to be used to interpret or define the provisions of the Agreement.
(f) Certain Prohibited Economic Incentives. Borrower covenants and agrees that this
Agreement does not violate Section 501.161 of the Act, as amended.
(g) Community Involvement. Although not an event of default or condition of any advance
hereunder, the Borrower 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 Pearland, Texas, and to actively encourage its employees to be involved in
such organization and/or activities.
(h) Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original and all of which shall constitute one and the same
document.
Page 10 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/201412:15:58 PM
(i) Employee Hiring,Materials and Supplies Purchase. Although not an event of default
or a condition to this Agreement, Lender requests that the Borrower satisfies its need for
all additional employees from City, of Pearland, Texas, residents and purchase all
materials, supplies and services necessary to affect the occupancy of the Property from
City of Pearland merchants and businesses.
(j) Force Majeure. It is expressly understood and agreed by the parties to this Agreement
that if the performance of any obligations hereunder is delayed by reason of war, civil
commotion, acts of God, inclement weather, fire or other casualty, or court injunction, the
party so obligated or permitted shall be excused from doing or performing the same
during such period of delay, so that the time period applicable to such obligation or
requirement shall be extended for a period of time equal to the period such party was
delayed.
(k) Notices. All notices required to be given under this Agreement shall be given in writing
and shall be effective when actually delivered or when deposited in the United States
mail, first class, postage prepaid, addressed to the party to whom the notice is to be given
at the address shown on Page 1 of this Agreement. Any party may change its address for
notices under this Agreement by giving formal written notice to the other parties,
specifying that the purpose of the notice is to change the party's address. For notice
purposes, Borrower agrees to keep Lender informed at all times of Borrower's current
address.
(1) Severability. If a court of competent jurisdiction finds any provision of this Agreement
to be invalid or unenforceable as to any person or circumstance, such finding shall not
render that provision invalid or unenforceable as to any other persons or circumstances.
If feasible, any such offending provision shall be deemed to be modified to be within the
limits of enforceability or validity; however, if the offending provision cannot be so
modified, it shall be stricken and all other provisions of this Agreement in all other
respects shall remain valid and enforceable.
(m) Successors and Assigns. This Agreement is with the Borrower, and shall not survive any
sale, merger, change of control or similar transaction involving the Borrower, without the
written consent of the Lender. The Borrower shall provide the Lender written notice of
any assignment, sale, merger, change of control or similar transaction pursuant to this
Agreement as soon as possible, and in no event not later than thirty (30) days following
such event.
(n) Survival. All warranties, representations, and covenants made by Borrower in this
Agreement or in any certificate or other instrument delivered by Borrower to Lender
under this Agreement shall be considered to have been relied upon by Lender and will
survive the making of the Loan and delivery to Lender of the Related Documents,
regardless of any investigation made by Lender or on Lender's behalf.
Page 11 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM -
(o) Time is of the Essence. Time is of the essence in the performance of this Agreement.
(p) Undocumented Workers. Borrower certifies that the Borrower does not and will not
knowingly employ an undocumented worker in accordance with Chapter 2264 of the
Texas Government Code, as amended. If during the Term of this Agreement, Borrower
is convicted of a violation under 8 U.S.C. § 1324a(f), Borrower shall repay the amount
of the public subsidy provided under this Agreement plus interest, at the rate of eight
percent (8%), not later than the 120th day after the date the Lender notifies Borrower of
the violation.
[The Remainder of this Page Intentionally Left Blank]
Page 12 of 25
Loan Agreement
Pearland Economic Development Corporation
1 1/12/2 01 4 12:15:58 PM
I
BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
AGREEMENT, AND BORROWER AGREES TO ITS TERMS. THIS AGREEMENT IS
DATED AS OF EFFECTIVE AS OF /
BORROWER:
KEYSTONE ENGINEERING,.•INC.
a Texas S-Corporation,
By: /
Name: William S. Ring
Title: President r
Date Signed: 6 ,Sr _IZQ•I
LENDER:
PEARLAND ECONOMIC DEVELOPMENT
CORPORATION,
a Texas non-profit corporation
By: _..
Matt. uchanan,
President
Date Signed: - I I- / c
ATTE .
cy Steve r, e-President I
Page 13 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM
THE STATE OF TEXAS §
COUNTY OF BRAZORIA §
BEFORE ME, the undersigned Notary Public, on this day personally appeared Matt
Buchanan, President of the Pearland Economic Development Corporation, a Texas non-profit
corporation, known to me to be the person whose name is subscribed to the foregoing instrument
and acknowledged to me that he executed the same for the purposes and consideration therein
expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE THIS 1 61A DAY OF
to)2 e Q Vii .12-‘1 A.D.,20 l - .
,,,,,�,,,,,,, `41,E KLi Sty)
�•,�;°oo., ROXANNE LUNd=I��'SEN
Notary-Publici State7oilexas NOTARY PU C, STATE tinLCA
My°CommissfonExpires:..''.. SeatG ber`17; 2018.;. Printed Name px nr2jSP-
• Commission Expires: 9- "[- 20 1 a
THE STATE OF (,eNat,S §
COUNTY OF BRAZORIA §
BEFORE ME, the undersigned Notary Public, on this day personally appeared William
S. Ring,President, of Keystone Engineering, Inc., a Texas S- Corporation, known to me to be the
person whose name is subscribed to the foregoing instrument and acknowledged to me that he
executed the same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE THIS 7 S DAY OF
IV ove IOW ,A.D.,20 14 .
,��'?u,�., MADISON OTTENLl Cz
a° ' to Notsry PubIIC Stete Of Texes
1-E My Commission Expires NOTARY PUBLIC, STATE OF-rem s
'',r••:.;�F May 17, 2015 Printed Name: I-1O4.50Y1 041e
Commission Expires: 05—I`7- ZO!S
Page 14 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM
Exhibit A
[Description or Depiction of the Property]
1
Page 15 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM
tEt=
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\ ———_— BEING ALL OF A CALLED 23.521 ACRE
__ TRACT OF LAND RECORDED IN THE
/ \ J—I ——— I NAME OF CITY OF PEARLAND IN
\ / —b- „ I B.C.C.F.No.2005056389
\ _ —/— 06 IN THE
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\ \ BRAZORIA COUNTY,1E%AS
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I.TM MOT WAS PREPAREO 11111102,113 Open LF A.,
M OD]W Hi m 3.R 00001 LLAMAS OE EEO. _ _ nt
,waz �m� "'",a,
Exhibit B
[Annual Compliance Verification Form]
Page 16 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM
•
Employment-Position Information
All positions must be full-time(2000 hours or more annually)and permanent,with the Company.
1. Total Number of Employment Positions previously certified:
2. Total Number of New Employment Positions Submitted for Certification this period:
3. Total Number of Employment Positions Reported(line 1 +line 2):
4. Total Payroll for all Employment Positions Reported this Claim_Period: $
5. Average annual gross compensation at this Company/Project Facility(line 4/line 3):
Employment-Position Information
All positions must be full-time(2000 hours or more annually)and permanent,with the Company.
1. Total Number of Employment Positions previously certified:
2. Total Number of New Employment Positions Submitted for Certification this period:
3. Total Number of Employment Positions Reported(line 1 +line 2):
4. Total Payroll for all Employment Positions Reported this Claim Period: $
5. Average annual gross compensation at this Company/Project Facility(line 4/line 3):
Did the Company meet the job creation and retention targets for this reporting period? ❑Yes ❑No
If no,please explain why:
Does the Company provide medical and dental benefits to all employees? ❑Yes ❑No
Investment Information (if applicable)
1. Total Investment(Qualified Expenditures)Previously-Certified:
2. Total New Investment(Qualified Expenditures) Submitted for Certification this Claim Period:
3. Total Investment(Qualified Expenditures)Reported(previously certified and new line 1 and 2):
Did the Company meet the investment target for this reporting period? ❑Yes ❑No
If no,please explain why:
Taxable Value Information (if applicable)
The following should reflect the change in taxable value according to the appropriate Central Appraisal District.
TAXABLE VALUE 20_ORIGINAL TAX TAX TOTAL INCREASE
ON SITE BASE VALUE YEAR 20_ YEAR 20_ OVER 20_BASE •
Land $ $ $ $
• Building and Improvements $ $ $ $
Fixed Equipment $ $ $ $
Personal Property $ $ $ $
Inventory $ $ $ $
Total Taxable Value $ $ $ $
Please submit requested attachments.
Other Information
Is the company in compliance with all terms and conditions of the agreement for this reporting period and all previous
periods: ❑Yes ❑No
If no,please explain why:
2
Attachments
Please attach the following documents:
Al—Annual Employment Compliance Verification
A2—Texas Workforce Commission Employer Quarterly Report(if requested)
A3 — Certified copy of the appraised and settled value of the Improvements as shown by the appropriate Central
Appraisal District supported by all correspondence,renditions,appeals or contests and settlement of appraised value and
shall provide appropriate back-up data for the Improvements exclusive of other investments made at the Premises.
A 4—Business Personal Property Rendition of Taxable Property Form
Certification
I certify the Business has not, within the reporting period, been cited or convicted for violating any state or federal
statutes,rules,and regulations,including environmental,worker safety and immigration regulations.
I certify the existence of a lease, for the building(s) on the Property, between the Property owner and Borrower that
currently is in effect and shall remain in effect throughout the Term of this Agreement.
Under penalty of perjury,I declare that the information in this document and any attachments are true and correct to the
best of my knowledge and belief.
For the Business:
Signature Date
Name and Title(typed or printed)
•
ANNUAL EMPLOYMENT COMPLIANCE VERIFICATION DETAIL
ABC Company, Inc.
Project Approved: 10/23/98
Job Certification Period: January 1,2000 through December 31, 2000
ABC Company
114 Oak Drive
Pearland,Texas 77581
Job No. Position Title Social Employee Wages Hours Date Hired to, City of
Security Name During Claim Worked Position/Date Pearland
Number Period During Claim Left Position Resident
Period
PREVIOUSLY CERTIFIED JOBS (updated):
001 Division ###-##-#### Dennis $68,987 2,318 09/01/98 to N
Director Director Present
002 Office #/##-##-#### Mary Worker $15,236 1,200 01/15/98 to Y
Manager 8/31//98
002A ###-##-###l# Lindsey $12,008 900 9/1/98 to Y
Sellsmith Present
NEW JOBS THIS CERTIFICATION:
003 Sales ###-##-#### Delores $29,695 2,080 09/01/99 to N
Manager Incharge Present
004 Print Shop ###-##-#### Adam $32,450 2,056 09/01/99 to Y
Manager Typeset Present
Total Jobs Created: 4
Total Payroll: $###,###
Vacant Positions: 0
TOTAL#OF JOBS ON THIS PAGE 4
PAGE#1 of 1
TOTAL#OF JOBS ON THIS CLAIM :4
4
Exhibit C
[Note]
Page 21 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM
PROMISSORY NOTE
$189,000.00 ,20_
("Effective Date")
KEYSTONE ENGINEERING, INC., (including successors and assigns, hereinafter
referred to as the "Maker"), For Value Received, promises and agrees to pay unto the order of
PEARLAND ECONOMIC DEVELOPMENT CORPORATION, a Texas non-profit corporation
(hereinafter referred to as the "Payee"), at its corporate offices located at 1200 Pearland
Parkway, Suite 200, Pearland, Texas 77581, in lawful money of the United States of America,
the principal sum of One Hundred Eighty-Nine Thousand and no/100 Dollars ($189,000.00),
or so much as shall be advanced, said sums to accrue interest at the rate of eight percent (8.0%)
per annum.
TERMS OF PAYMENT: The principal of this Note is due on demand, but in any
event, on or before December 31, 2023. Notwithstanding the foregoing, loan proceeds
hereunder shall be advanced in accordance with the terms and provisions of that certain Loan
Agreement executed as of even date herewith between Maker and Payee (hereinafter referred to
as the "Loan Agreement"), and such loan proceeds shall be forgiven and or repaid according to
said Loan Agreement after such advance if Maker is not then in default under the Loan
Agreement. As such, Payee shall make no demand on principal under this Note except for upon
occurrence of an Event of Default as that term is defined in the Loan Agreement.
ALL PAST due principal shall bear interest until paid at the rate of twelve percent
(12.0%)per annum.
THIS LOAN is a line of credit but is not revolving. As already stated, loan proceeds
made hereunder are also governed by the Loan Agreement of even date herewith.
IF DEFAULT is made in the payment of any interest or principal hereof, as and when the
same is or becomes due, or if an Event of Default occurs under any instrument securing the
payment hereof or executed in connection herewith, including the Loan Agreement, the owner
and holder of this Note may declare all sums owing hereon due and payable within thirty (30)
days of the date of notice. If default is made in the payment of this Note at maturity (regardless
of how its maturity may be brought about), and the same is placed in the hands of an attorney for
collection, or suit is filed hereon, or proceedings are had in bankruptcy, probate, receivership or
other judicial proceedings for the establishment or collection of any amount called for hereunder,
or any amount payable or to be payable hereunder is collected through any such proceedings,
Maker agrees and is also to pay to the owner and holder of this Note a reasonable amount as
attorneys' or collection fees.
Page 22 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/201412:15:58 PM
Except as provided herein and m the Loan Agreement, upon an Event of Default (as that
term is defined in the Loan Agreement) only, Maker, co-makers, signers, permitted assigns,
sureties, endorsers and guarantors, and each of them, expressly waive demand and presentment
for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of intent
to accelerate the maturity hereof, notice of the acceleration of the maturity hereof, bringing of
suit and diligence in taking any action to collect amounts called for hereunder and in the
handling of securities at any time existing in connection herewith; and are and shall be jointly,
severally, directly and primarily liable for the payment of all sums owing and to be owing
hereon, regardless of and without any notice, diligence, act or omission as or with respect to the
collection of any amount called for hereunder or in connection with any right, lien, interest or
property at any and all times had or existing as security for any amount called for hereunder.
IT IS the intention of Maker and Payee to conform strictly to applicable usury laws.
Accordingly, if the transactions contemplated hereby would be usurious under applicable law
(including the laws of the State of Texas and the laws of the United States of America), then, in
that event, notwithstanding anything to the contrary herein or in any agreement entered into in
connection with or as security for this Note, it is agreed as follows: (i) the aggregate of all
consideration which constitutes interest under applicable law that is taken, reserved, contracted
for, charged or received under this Note or under any of the other aforesaid agreements or
otherwise in connection with this Note shall under no circumstances exceed the maximum
amount of interest allowed by applicable law, and any excess shall be canceled automatically
and, if theretofore paid, shall be credited on the Note by the holder hereof(or, to the extent that
this Note shall have been or would thereby be paid in full, refunded to the Maker); and (ii) in the
event that maturity of this Note is accelerated by reason of an election by the holder hereof
resulting from any Event of Default, or in the event of any required or permitted prepayment,
then such consideration that constitutes interest may never include more than the maximum
amount allowed by applicable law, and excess interest, if any, provided for in this Note or
otherwise shall be canceled automatically as of the date of such acceleration or prepayment and,
if theretofore paid, shall be credited on this Note (or, to the extent that this Note shall have been
or would thereby be paid in full,refunded to the Maker).
THIS NOTE has been executed and delivered in and shall be construed in accordance
with and governed by the laws of the State of Texas and of the United States of America, except
that V.T.C.A. Finance Code, Chapter 346, as amended (which regulates certain revolving credit
loan accounts and revolving tri-party accounts) shall not apply hereto. Payee's address for notice
is 1200 Pearland Parkway, Suite 200,Pearland, Texas 77581.
[signature on next page]
Page 23 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM
In witness whereof,Maker has executed this Note to be effective as of the Effective Date.
MAKER:
KEYSTONE ENGINEERING,INC.
a Texas S-Corporation
By: �iJ�L /� / /
Name: William S. Ring
Title: President
Date Signed: 1-2
Page 24 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM
Exhibit D
[Application]
Page 25 of 25
Loan Agreement
Pearland Economic Development Corporation
11/12/2014 12:15:58 PM
,
-
,
PEA�RLAN13 ECONOMIC-DEVELOPMENT CORPORATION
- FINANCIAL ASSISTANCE APPLICATION
The Pearland Economic Development-Corporation (PEDC) encourages a consultation visit-before.`completing an
• application. Application should be submitted, to the Pearland Economic.Development Corporation President,-1200 -
° Pearland Parkway, Suite 200, Pearland,si'exas,r 1581,281.997.3000,-Www.pearlluidtdc.com. Please attach exhibits'and
additional information.
Applicant Information
7 r Engineering p' 14 ,,
\ame of Business: Keystone i u tneenn Group',Inclnc. ' Date:$ 12--
Address: •
6310 Sidney Street
City:Houston State: T1 ' Zip: 77021 . .
.Contact Person: Mark Ring -` - '' Title:_.In 1=louse-Counsel;`. - - - . -
Phone: 281 997-3300 Fax: 281-997-1300 Email. mring�@keinlon.com ..
\AIDS Codes for prunary business operations: 901590O000 ,
Federal Tax ID Number: . : .
Does the•Busuiess file a consolidated tax return under a different tat-ID number? , ❑. es - ®=No:'
- If yes,please also provide that tax ID number 74-1367867 .•
Teas Tax m Number: . - ,
Is the contact persoiilisted above authorized to obligate the Business? '
Yes No
" It no,please provide the name and title'of a company officer autlionzeii to obligate the'Bussiness "
, John Ring,'Vice-President - _
William S`Rim:, President
,
- - 1 • -
t
_
y e
._
r ,
- ..Business Information .r , - ,4
. s
rn Provide a brief description and histon of thu Business. B Include information-about the usiness'products or,services . i
; sand markets served v:
Cu'.tom m tnufacnuyng.and coinpostte<fabricauoii _
Business Structure ,'. - "
❑ Cooperative' ❑ „Corporation ❑ Limited I tlbility--Company ,_❑ \ot,for Profit . .i
Patnersly
a
❑ p ® `S=Corporation ❑ Sale Proprietorship
State c f:Incorporanon:
Tned sa:_ an i
h enne Jn / ) Rll R (1/3) tc amRing( 3),Identify,te3tisiness'owersndprceowhip. o 'Ring3 , usseng: , ilh I
' Annual Sales.(MostRecent):.S(2013)36 7 44;815 ..,, - - a
-' Projected Tot ii Sales ;' `Year'1 Sa9;000 000 ". fear 2 $42,000,000 . -dear 3:,'" ` - i
'$45,000,000 .v i
' How many employees are currenth employed by.
the Business including.all locations,subsidianea divisions worldwide
1 ' List tlie'Business'-`Iexas`Locations and the Current 'umber.of-full-rime;equ�valent(1 11.)Lmpioyees it,each Location
(including Pearlandif applicable): 174 employ ees. Locations'in,Houston and Engle;Texas i
y
Current annual p ty ct roll oflPearland faltts;excluding a be ,ny nefits•(if apphcal le) SN/ no P,earland operation
= -Does the Business offer'medical'and dental insurance? '® I es_❑ \o _
_ I f),es-please describe:.
- Does the Business offer a-pension plant,401(k)plan;and/or rettrement,plan - '® Yes;❑ ,N.c _
If yes;please.describe. -
Please'proside albncf descriptiono1 the-I3usuiess in;oh imcnt tn`tlie communtn(ies),that it has locations .
' `"Key stone actii-el-hues etsonnel,from as>ailable communities in,which it operates'regul itly. In addition,Keystone E
strives to bop locally �ehenes er possible:- Key stone s'a supporter of the Chamber of Commerce;sponsors arious
youth;sports,and offers intersliips to local studenrckinterested in,Engineering or manufactuing ,, . I
a
. :
, ,
, 1
Y
kkk - e a ' n , v„
[[
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,-
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+z: _v.,.,.,.:�....t�«..,®.:,.a,`.e,,.......,._:a..,_._........�...e.,:;r..__.._.....e.,a.n...-._....:........e,.m.-.,,,a.w...:....,..,.,:.��..,_...._.�..�.v_.....,...._..,....,...,mot,....--..,....-..,,......... ._.,....,.,..,.,...,�«,.,a,.,,._w,.-.._.._ .. ;...�..-._ �_,..,.:..,�_...-.
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-
-
Project Information • =
-Project Street_\lddress; 1509\:-\lain Street
Tape of Busin• ess Project
•
;® NewLocauon ❑ ,7 pansion of Pe rland,Compan� �
) rtetl};de�eribe the ro osed roject for which assistance is butt tioti htr nclude ";ro ect factls size infrastructure
P ,P P,.�1 � �-. g � P l tS• ,
improvements;propo•ed,prodticts/Services anc<'new marl erti etc:)':
Keystone is looking to reloc ire it's:headquarters and.operations fo a,'state-of-'the art ot5ce'and manufacturutg
floor `The initial project will hltel}house`apro�una•
tch I t)000 sq ft-of office_and fle:space and an addtuonal
3a 000=40 000 sq tt of manufacturing Consolidating multiple site's nto'one,build ng will•increase producuc�t
_ and efficiency,-and allow our"customers to see.'ill of the-
; i uious.capabilities of Keystone in one pI ice:
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-Has an .part of the project started? ®1'es ❑\o
If�es;'pie tse e.phm Contractwto purchase 11nd.
Identify the Business competitors: It an}>.(..f these competitors haw Pearland loc ttions,please explain the nature of.the
• ; competition (e,g, competiule business segment-,estimated market share, etc) and.elplain-what.impact the proposed
project ma} have on the Pearland:compet'itor
C1ill any of the:current Pearland employees lose:their jobs it tlus project.doe's not proceed to Pearland?(F�tstiizg i
Pearl<ui i Companres onl)), ❑ 'sec ❑ \o
Tf ces,;please explain-why and identifi those jobs as retai jobs `in the 1?toject obs se
ned _J ction F 1
,Is the Businessmacti el}-considering locations outside of Pearland? 7-1 es ❑ o ,,
" ° If�es„where'=and what assistance is being;offered?,
Pursuing Pearland fast
- Rill any,State or-Federat'Permits tie needed,for the-project, ❑ _es° ® \o
If}es please describe each and current time frame for`receiving each?
��rlltle p •ect be seel,in LEER ccrttficauon? c, `o,
If ves)what lei el.of cerrifie moon"is being sought.
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'--' - 71
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, , =Project,Budget
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A141., OUNTS.BUDGETED �` ;�-
Use;of Funds Cost Source Commitment Status
Lind'\cgwssuon $ 543,765 "Cash.,Funded° ,
"Site Preparation,' $ 1,116,060 - -
.• Cost of Utilities to:Site� S. . - included in site„pre " " - i
-Building.rlcgwi " ,: , $..
,
> '' ' Building Construction. $ 2,750,000 , _ i
BuildingR-emodelusg` • - $
_- _-.,liachusere&.Equip.: _ ,-.. $ ;- 1,7.85;124 ` owned,febenioseelr"
,
.1.
Computer Har.'davare -' `• S 20,000 'owned,to bc'mot ed - ' j
f Computer S'oftw'are, , - $ 75,0.00 - owned,to be moved - '. -
j Furniture&Ft�t tires. $ TBD C ish -
r' AVorking Capital,' _ $ =�`` 1
Moving Expenses $ 200 000
ob P
TOTAL
.a:
rpoes'theI3usiness'plan to- the facility?- 1
- If)es please provide the-.annual Base Rent Pas ment(lease p u merit nminus,property t ixe.,insurance,aand ;' .i
'operating/maintenance expenses)andihe length of the-lease agreement, . - . -j
Financial assistance ss need based,.ple,ase explain why assistance is needed, •
,.1
k r\n}' recipient of assistance is expected to provide secant) to the Corporation The-,security Will be exercised"`when
E" 'neces'.artr, due-to non performance In addition to a l.ien•and/or'mortgage, per"sonal.'guarantees are expected lot 1
'"` fl usinesses riot p pblicl} :traded, and,`co porate,guarantees are expected then the:business'recipient has'a`parent (or
. ''holding)~company_ \Vhat'°secant}-will be offered:to secure financial assistance and';describc What seniority or position j
the Corporation willhave on any lien or,mottgage? % % 1
.` Ike}stone-requires assistance relocating its.-manufacturing equipment irons its various loeations to its new headquarters f
"Keystone would'also like,"assistance with costs-related to reducing the risk of fires such-.as lucreased access poi is 1
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sprinklers;and,othet,safety related+need, , _ +,;1
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if' Project Jobs
'`List the jobs that will tie created a'nd/or"retained•his the result of this project:(1 retained job is an es sttngjob that would
- be eliminated-6r moved to another location if the.project does,not"proceed•in Pearland)To be considered a job must be
1 r With lthe company,a\V2'employee of-tl e compact and•:spend 30 hours or`more;per‘a eel.,at the project site:in•Pearland _ j
'For jobs-to be created it clude`the starring and final hourly wage tare For:et•tuted jobs;uicludc the current hourly Wage -j
rate
Is the hourly a wage rate based on•a 40 hour work v eeit 2 weeks 1>er ye'ir Q les•,❑ \o : _`,,i
_ If no file tse ex lain.
j _ Full-Time CREATED Jobse (Add additional rnlv.,as needed),."
\
,4
t - umberof
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1�Uage,at Endo -j
_ Job Title/Classifi citnoii CREATED ' S tartin g R age :year Tltree`
lobs
Office and managers:: 1. 9 : $ S
I Machinist/Inspectors : 61 $
r.
i, - _ $
Total CREATED obs 4
: ' ":aFerage$.
-. Full-Time RETAINED Jobs* - (Add additional mfus ar`needed1" -=--1
'I Job title/Classificauoii
umber of
1 �� :.•" _-�° - Curre;iitj-\\gage `'
; - l RETAINED )obi..: '•. .:' : .
$ s
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' 3
fi
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Total RETAINED,Jobs
j . ` : = 'E'istiiig lobs:bleed-in=Pearland `
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Attachments '
Please attach the fella-Ong documents: '
• Al .Completed Fconomtc Impict Data Sheet,(If requested):' , rr
':A2 Business Plan(If requested)
11.,,: ,;a A3 ',�"Completed etriploymeritconipliatice.xrerification'form(esistuig Pentland employ eis.onit) ;',-` "";' -,,..,',.I
�s
°A4 FinancialInfomation
' -` ;•' .:Audited profit'and.loss statements and balance�shcets;fer past three year-ends - -I
Current YID-profit and loss_statement and balance sheet:and ..
Schedule of aged accounts recei A vahle,'
, ,:. , .• . -Schedule ofaged accounts pay able;and" °'` , ?
• .. Schedule of debts.-NONE r .1,.-
99
1'- a .Certification & Release of Information
I:- , - I heiehy,gt�e,,perraiission to-the,'PearLand Economic.Development.Corporation;(PEDC)'to-research the Busuic ss - i
r. . ''' lustory, make,credit,checks, contact the Business' financial institutions;-insurance carriers,-and,perfo'ixri other !elated m= i
°. . activ ties.nceescary for reasonable evaluation•of this application -
I•'understatid'that all informatiot sub'tmtted to PEDC related to"'thus application is subject sta Texas Public Information .,
act., �:
° 'a 1:Understand this application is subje'et''to"final'approt aly Pr
by.the Pentland Econonue'Oeielopment Corporaton,Boardof - -
Directors,and-under some circumstances•the City,of-Pentland City Council,aticl the•project,ma-i.not,be initiated until -z
finaLappro' alas secured.''
`I understand that PEDCrescrves the right to negotiate tin. financial assistance Furthermore i arn�ausirc that financial
assistance is not aN a'ilable until an'agreement is'eeecutcd within a reasonable-time period following'sipprou al. i
'4I certify",the Business has not,within the last five years,peen cited-or convicted for violating nr.i..i state or federal statutes;
t -rules,and regulations,including.environmental;'•�vorker safety,aid immigration regulations -T _ -
;` 'I hereby certifyr th it all',representations;warranties,or statements made or furnished to PEDC in connection with tins'
l application ate true-and correct in all matenal res ect, 1"understand that it is.a viplation',tiiider Texas law to engage in-
- "deception and,knowingly make,"or caus"e'to he made;directly or indirecth-;•a false statement in writing for.the'purpose of .
-s ...procuring economic,develo iiient•issistance from a_develo inentco oration.: s
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�`- For the.Business
Og l2 2n1
, :signature
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.Date.
- Marki:Ring.In'1-louse Counsel
Name•and'Iitie(typed or printed}
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