Contract - Hubbell Lighting - 6/11/2020 ECONOMIC DEVELOPMENT PROGRAM AGREEMENT
This Economic Development Program Agreement("Agreement") is entered into this II_day of
�Tu14 , 2020, by and between the City of Round Rock, Texas, a Texas home rule
municipal corporation ("City"), and Hubbell Lighting, Inc., a Connecticut Corporation, whose
office is located at 701 Millennium Blvd., Greenville, South Carolina,29607 ("Hubbell").
WHEREAS, the City has adopted Resolution NoKAOX-0 attached as Exhibit A ("City
Resolution"),establishing an economic development program and authorizing the Mayor to enter
into this Agreement with Hubbell in recognition of the positive economic benefits to the City
through Hubbell's intention to: (i) lease a facility in the City ("Facility") for the operation of
"Project Illuminate," a commercial lighting division of Hubbell Incorporated ("Project"), for a
minimum of five(5)years; (ii)invest at least$1,000,000 in real property and$650,000 in business
personal property into the Facility by the completion of Year 1 of the Project; (iii) create a
minimum of thirty-five (35) new jobs by the completion of Year 3 of the Project for employees
new to the organization or relocations from the outside of the Austin MSA; and(iv)maintain no
less than (50)jobs total by the end of Year 3 of the Project with an average salary of$120,000.00
per year.
WHEREAS, Hubbell's headcount in its existing Travis County, Texas facility as of August 25,
2019 (when Hubbell began its discussions with the City)was fifteen(15) employees; and
WHEREAS,Hubbell hired and/or relocated eight(8)employees from Austin following its initial
discussions with the City in August 2019 (the "2019 New Hires") and the City intends to count
the eight (8) 2019 New Hires as new jobs for purposes of calculating whether headcount
requirements have been satisfied;
WHEREAS,Hubbell expects to hire or relocate additional employees for the Project over the next
year•,
WHEREAS,the purpose of this Agreement is to promote economic development as contemplated
by Chapter 380 of the Texas Local Government Code whereby Hubbell intends to accomplish the
foregoing; and
WHEREAS, the City agrees to provide performance-based Economic Incentive Payments
("EIP's")(as defined below);
NOW, THEREFORE, in consideration of the mutual benefits and promises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
City, and Hubbell agree as follows:
1. Authority. The City's execution of this Agreement is authorized by Chapter 380 of the
Texas Local Government Code, and the City Resolution, and constitutes a valid and
binding obligation of the City in the event Hubbell proceeds with the lease, improvement,
occupation, and staffing of the Facility. The City acknowledges that Hubbell is acting in
reliance upon the City's performance of its obligations under this Agreement in making its
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Final Incentive Agreement Round Rock-HLI 15 May 2020.docx
decision to commit substantial resources and money to lease, improve, and occupy the
Facility.
2. Definitions.
2.1. "Business Personal Property" means fixtures, equipment, artwork and furniture
purchased for the purpose of supporting Hubbell's business operation as the
Facility.
2.2. "Economic Incentive Payment(s)" ("EIPs")means the amount paid by the City
to Hubbell under the Program.
2.3. "Effective Date"is the date this Agreement is executed to be effective by the City
and Hubbell.
2.4 "Facility" means approximately 15,000 square feet of office space in a building
located at 710 Hesters Crossing Road, Round Rock, Texas 78681, known as
"Summit II,"which will be leased by Hubbell.
2.5. "Full Time Equivalent Employee" ("FTE")means a combination of employees,
each of whom individually is not a full-time employee because they are not
employed on average at least 35 hours per week, but who, in combination, are
counted as the equivalent of a full-time employee. FTE's shall include original
hires or their replacements over time.
2.6. "Program" means the economic development program established by the City
pursuant to Chapter 380 of the Texas Local Government Code and under the City
Resolution to promote local economic development and stimulate business and
commercial activity within the City.
2.7. "Real Property Improvements" means costs directly incurred as a result of the
rehabilitation, reconstruction, repair or remodeling of the existing Facility for the
purpose of supporting Hubbell's business operation. This does not include soft
costs such as financing costs,permit fees, attorneys, and similar costs.
2.8. "Recapture Liability"means the total amount of all EIP's that are paid as result
of this Agreement that are subject to recapture by the City from Hubbell in the event
of Hubbell's default.
2.9 "Year 1"means the calendar year following the City's issuance of a Certificate of
Occupancy for the Facility.
3. Intention of Parties. The City Council of Round Rock has previously determined that one
of its priority goals is to encourage economic development within the City.To further these
goals,the City is willing to provide EIP's to assist Hubbell in the leasing and improving of
the Facility.
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4. Term. This Agreement shall become enforceable upon its Effective Date and shall
terminate on December 31 of Year 5.
5. Rights and Obligations of Hubbell.
5.1. Lease. Hubbell agrees to lease the Facility.
5.2. Real Property Improvements. Hubbell agrees to invest at least $1,000,000 in Real
Property Improvements to 'the Facility (the "Real Property Investment
Threshold") in accordance with the following schedule (the "Real Property
Investment Schedule"): at least$1,000,000 in Real Property Improvements to the
Facility by the expiration of Year 1 (including any Real Property Improvements
made prior to the date of this Agreement).
If Hubbell achieves the Real Property Investment Threshold, Hubbell agrees to
provide the City with documentation that shows proof that this threshold has been
satisfied,and the City shall have the right to audit Hubbell' s records to verify same.
5.3. Business Personal Property Investment. Hubbell intends to invest at least$650,000
in Business Personal Property for the Facility(the"Personal Property Investment
Threshold") in accordance with the following schedule (the "Personal Property
Investment Schedule"): at least $650,000 in Business Personal Property for the
Facility by the expiration of Year 1 (including any Business Personal Property
investments made prior to the date of this Agreement).
In order to provide proof that the Personal Property Investment Threshold is being
satisfied in accordance with the Personal Property Investment Schedule, on or
before April 15 of Year 1, Hubbell agrees to provide the City with a copy of the
rendition statement filed with the Williamson Central Appraisal District,pursuant
to § 22.01 of the Texas Tax Code. The rendition statement shall indicate that the
business personal property has either an estimated market value,or a historical cost
when new of at least the Personal Property Investment Threshold or portion thereof
Schedule.
5.4. Jobs.
Thirty-five of those fifty (50)jobs shall be for employees new to the organization
or relocations from outside of the Austin MSA (the "Headcount Requirement").
"Jobs" shall include full-time employees and/or FTE's and shall include the 2019
New Hires.
5.5. Job Compliance Affidavit. On or before April 15 of Year 1, and for each
calendar year thereafter of this Agreement, Hubbell agrees to provide to the City
a Job Compliance Affidavit, a copy of such Job Compliance Affidavit being
attached hereto as Exhibit B. City shall have the right, following reasonable
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advance notice to Hubbell,to audit Hubbell's records to verify that this obligation
has been satisfied.as required to be obtained in accordance with the Personal
Property Investment
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5.6. Compliance with regulations. Hubbell agrees that it will comply with the City's
development approval processes, and shall construct and install the improvements
and lease and operate the Facility consistent with City ordinances, development
regulations and legal requirements.
5.7. Continuous operation. Hubbell agrees that following Hubbell's commencement of
operations at the Facility, it will continuously operate the Facility during the term
of this Agreement for a minimum of five (5) years from the effective date of this
Agreement, except during periods of construction or reconstruction of the Facility
or in the event of a casualty, condemnation or other force majeure event with
respect to the Facility or a portion thereof.
5.8. Clawback. In the event that Hubbell fails to comply with any of the actions as
described in Section 5.1 through 5.7 above (including, without limitation, any
failure to comply with the Real Property Investment Schedule, the Personal
Property Investment Schedule, and the Jobs Schedule), and such failure continues
for a period of thirty (30) days after Hubbell's receipt of written notice of such
failure from the City,Hubbell will immediately pay to the City an amount equal to,
but not to exceed,the Recapture Liability.
6. Economic Incentive Payments.
6.1 In consideration, and subject to Hubbell's compliance with this Agreement
(including Hubbell being in compliance with the Real Property Investment
Schedule, the Personal Property Investment Schedule, and the Headcount
Requirement), the City agrees to pay EIPs as set forth below.
6.2. Schedule for EIPs. City shall, subject to Hubbell's satisfaction of its obligations set
forth herein within forty-five (45) days of the conclusion of Year 3, make an EIP
to Hubbell in the amount of$125,000.
6.3. EIP Subject to Future Appropriations. This Agreement shall not be construed as a
commitment, issue or obligation of any specific taxes or tax revenues for payment
to Hubbell. The EIPs by the City under this Agreement are subject to the City's
appropriation of funds for such payments in the budget year for which they are
made. The EIPs to be made to Hubbell, if paid, shall be made solely from annual
appropriations from the general funds of the City or from such other funds of the
City as may be legally set aside for the implementation of Article III, Section 52a
of the Texas Constitution or Chapter 380 of the Local Government Code or any
other economic development or financing program authorized by statute or home
rule powers of the City under applicable Texas law, subject to any applicable
limitations or procedural requirements. In the event that the City does not
appropriate funds in any fiscal year for the EIP due under this Agreement, such
failure shall not be considered a default under Section 7.3, and the City shall not be
liable to Hubbell for such EIP, however, the City shall extend this Agreement for
another year(s), until Hubbell has received all of the EIPs provided for herein. In
addition, Hubbell shall have the right but not the obligation to rescind this
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Agreement. To the extent there is a conflict between this paragraph and any other
language or covenant in this Agreement,this paragraph shall control.
6.4. EIP Recapture. In the event the City terminates this Agreement as a result of
Hubbell's default that is not cured within thirty(30)days after Hubbell's receipt of
written notice of such failure from the City,the City may recapture and collect from
Hubbell the Recapture Liability. Hubbell shall pay to the City the Recapture
Liability within thirty (30) days after the City makes demand for same, subject to
any and all lawful offsets, settlements, deduction, or credits to which Hubbell may
be entitled. Notwithstanding anything herein to the contrary, such Recapture
Liability shall not exceed, in the aggregate, an amount equal to all EIPs that were
paid pursuant to this Agreement from the Effective Date to the date of termination
(together with interest thereon to be charged at the statutory rate for delinquent
taxes as determined by Section 33.01 of the Property Tax Code of the State of
Texas, but without the addition of a penalty). The City shall have all remedies for
the collection of the Recapture Liability as provided generally in the Tax Code for
the collection of delinquent property taxes.
7. Miscellaneous.
7.1. Mutual Assistance. The City and Hubbell will do all things reasonably necessary
or appropriate to carry out the terms and provisions of this Agreement.
7.2. Representations and Warranties. The City represents and warrants to Hubbell that
the Program and this Agreement are within its authority, and that it is duly
authorized and empowered to establish the Program and enter into this Agreement,
unless otherwise ordered by a court of competent jurisdiction. Hubbell represents
and warrants to the City that it has the requisite authority to enter into this
Agreement.
7.3. Default. If either the City or Hubbell should default in the performance of any
obligations of this Agreement, the other party shall provide such defaulting party
with written notice of such default and thirty(30) days' opportunity to cure,prior
to instituting an action for breach or pursuing any other remedy for default. If the
City remains in default after notice and opportunity to cure,Hubbell shall have the
right to pursue any remedy at law or in equity for the City's breach. If Hubbell
remains in default after notice and opportunity to cure, City shall have the right to
pursue an remedy at law or in equity for Hubbell' s breach but only u to an
p Y Y q Y � Y p
amount equal to the Recapture Liability.
7.4. Attorney's Fees. In the event any legal action or proceeding is commenced in a
court of competent jurisdiction between the City and Hubbell to enforce provisions
of this Agreement and recover damages for breach, the prevailing party in such
legal action shall be entitled to recover its reasonable attorney's fees and expenses
incurred by reason of such action,to the extent allowed by law.
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7.5. Entire Agreement. This Agreement contains the entire agreement between the
parties. This Agreement may only be amended, altered or revoked by written
instrument signed by the City and Hubbell.
7.6. Binding Effect. This Agreement shall be binding on and inure to the benefit of the
parties,their respective successors and assigns.
7.7. Assignment. Hubbell may not assign all or part of its rights and obligations to a
third party without the express written consent of the City provided,however,that
this Agreement may be assigned by either party without the consent of the other to
an affiliate or to any third party who succeeds to a majority of its business or assets.
7.8. Amendment.This Agreement may be amended by the mutual written agreement of
the parties.
7.9. Termination. In the event Hubbell elects not to lease the Facility or install the
improvements as contemplated by this Agreement,Hubbell shall notify the City in
writing, and this Agreement and the obligations on the part of both parties shall be
deemed terminated and of no further force or effect.
7.10. Notice.Any notice and or statement required and permitted to be delivered shall be
deemed delivered by actual delivery, facsimile with receipt of confirmation, or by
depositing the same in the United States mail, 'certified with return receipt
requested, postage prepaid, addressed to the.appropriate party at the following
addresses:
If to City: City of Round Rock
221 E. Main Street
Round Rock,TX 78664
Attn: City Manager
Phone: (512)218-5400
Email: lhadl ey(c,roundro cktexas.gov
With a required copy to:
Sheets & Crossfield
309 E. Main Street
Round Rock,TX 78664
Attn: Stephan L. Sheets
Phone: (512)255-8877
Email: steve(&,scrrlaw.com
If to Hubbell:
Hubbell, Incorporated
40 Waterview Drive
Shelton,CT 06484
Attn: Legal Department
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With a required copy to:
Hubbell Lighting, Inc.
701 Millennium Blvd.
Greenville, SC 29607
Attn: Legal Department
Either party may designate a different address at any time upon written notice to
the other party.
7.11. Applicable Law. This Agreement is made, and shall be construed and interpreted,
under the laws of the State of Texas and venue shall lie in Williamson County,
Texas.
7.12. Severability. In the event any provisions of this Agreement are illegal, invalid or
unenforceable under present or future laws, and in that event, it is the intention of
the parties that the remainder of this Agreement shall not be affected. It is also the
intention of the parties of this Agreement that in lieu of each clause and provision
that is found to be illegal, invalid or unenforceable, a provision be added to this
Agreement which is legal,valid or enforceable and is as similar in terms as possible
to the provision found to be illegal, invalid or unenforceable.
7.13. Paragraph Headings. The paragraph headings contained in this Agreement are for
convenience only and will in no way enlarge or limit the scope or meaning of the
various and several paragraphs.
7.14. No Third-Party Beneficiaries.This Agreement is not intended to confer any rights,
privileges or causes of action upon any third party.
7.15. Force Majeure. Except as otherwise provided herein, an equitable adjustment shall
be made for delay or failure in performing if such delay or failure is caused,
prevented, or restricted by conditions beyond that Party's reasonable control (a
'force majeure event"). A force majeure event for the purposes of this Agreement
shall include, but not be limited to, acts of God, fire; explosion, vandalism; storm
or similar occurrences; orders or acts of military or civil authority; litigation;
changes in law, rules, or regulations outside the control of the affected Party;
national emergencies or insurrections; riots; acts of terrorism; or supplier failures,
shortages or breach or delay. Except as otherwise expressly provided,herein,there
shall be an equitable adjustment allowed for performance under this Agreement as
the result of any event of force majeure.
7.16. No Joint Venture.It is acknowledged and agreed by the parties that the terms hereof
are not intended to and shall not be deemed to create any partnership or joint venture
among the parties. The City, its past, present and future officers, elected officials,
employees and agents of the City, do not assume any responsibilities or liabilities
to any third party in connection with the development of the Facility or the design,
construction or operation of any portion of the Facility.
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EXECUTED to be effective as of the day of JAtqe—, ,2020.
CITY OF ROUND ROCK,TEXAS
By:
Cig orga Mayor
APPR W D as to ti folif
Stephan A. Sheets, City Attorney
HUBBELL LIGHTING, INC
By: A
it VP ti�--
i na e%c e
g
RESOLUTION NO. R-2020-0153
WHEREAS, the City Council has determined that one of its priority goals is to encourage
economic development within the city of Round Rock; and
WHEREAS, Hubbell Lighting, Inc. ("Hubbell") has expressed an interest in leasing a portion
of the building located in the City of Round Rock at 710 Hesters Crossing Road, Round Rock, Texas
78681, known as "Summit II" (the "Facility"); and
WHEREAS, the Council wishes to promote economic development as contemplated by
Chapter 380 of the Texas Local Government Code whereby Hubbell will lease and improve the
Facility; and
WHEREAS, Hubbell intends to add at least 50 employees within three (3) years of the
occupancy of the Facility with an average salary of$120,000; and
WHEREAS, Hubbell intends for at least 35 of those 50 jobs to be for employees new to the
organization or relocations from outside of the Austin MSA; and
WHEREAS, §380.001 Local Government Code provides that a municipality may establish an
economic development program ("Program") to promote local economic development and to stimulate
business and commercial activity in the municipality; and
WHEREAS, the City Council has determined that the Program described in Exhibit "A" will
encourage economic development within the City and will also meet the goals set forth in said
§3 80.001,Now Therefore
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS,
That the City offers to Hubbell a §380.001 Program whereby the City will grant certain
Economic Incentive Payments ("EIP's"), and
0112.20202;00447202
BE IT FURTHER RESOLVED
That the offer of the Program shall be as generally outlined in Exhibit "A" attached hereto and
incorporated herein for all purposes.
The City Council hereby finds and declares that written notice of the date, hour, place and
subject of the meeting at which this Resolution was adopted was posted and that such meeting was
open to the public as required by law at all times during which this Resolution and the subject matter
hereof were discussed, considered and formally acted upon, all as required by the Open Meetings Act,
Chapter 551, Texas Government Code, as amended.
RESOLVED this 11th day of June, 2020.
CRAIG OR N, Mayor
City of ound ock, Texas
ATTEST:
SARA L. WHITE, City Clerk
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EXHIBIT A
ECONOMIC DEVELOPMENT PROGRAM
The terms of the §380.001 Economic Development Program to be offered to Hubbell Lighting,
Inc. ("Hubbell") in exchange for Hubbell's lease of a portion of the building located at 710 Hesters
Crossing Road, Round Rock, Texas 78681, are as generally outlined below:
1. Hubbell's intentions and obligations:
1.1. Lease. Hubbell intends to lease and occupy a portion of the building located in the City
of Round Rock at 710 Hesters Crossing Road, Round Rock, Texas 78681, known as
"Summit II."
1.2. Investment. Hubbell intends to invest at least $1,650,000.00 in the improvement of the
Facility (including, without limitation, costs directly incurred as a result of the
rehabilitation, reconstruction, repair or remodeling of the existing Facility and costs
incurred for fixtures, equipment, and furniture purchased for the purpose of supporting
Hubbell's business operation at the Facility).
1.3. Jobs. Hubbell intends to add at least 50 employees within three (3) years of the
occupancy of the Facility with an average salary of$120,000, with at least 35 of those
50 jobs to be for employees new to the organization or relocations from outside of the
Austin MSA.
1.4. Compliance with regulations. Hubbell agrees that it will comply with the City's
development approval processes and shall construct and install the improvements and
lease and operate the Facility consistent with City ordinances, development regulations
and requirements.
1.5. Continuous operation. Hubbell agrees that it will continuously operate the Facility for a
minimum of five (5) years, except during periods of construction or reconstruction of
the Facility or in the event of a casualty, condemnation or other force majeure event
with respect to the Facility or a portion thereof.
2. City's obligations:
2.1. Economic Incentive Payments. In consideration of Hubbell's compliance with the
aforesaid intentions, the City agrees to grant Economic Incentive Payments to Hubbell
in the amount of$125,000.
3. The terms and provisions of this Program will be set out in more detail in the Economic
Development Program Agreement of even date herewith.
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EXHIBIT B
JOB COMPLIANCE AFFIDAVIT
BEFORE ME, THE UNDERSIGNED AUTHORITY, ON THIS DAY PERSONALLY
APPEARED (NAME), KNOWN TO ME TO BE
THE PERSON WHOSE NAME IS SUBSCRIBED BELOW AND AFTER HAVING BEEN
DULY SWORN,ON HIS/HER OATH STATED AS FOLLOWS:
I. "MY NAME IS . I AM OVER THE AGE OF 21 YEARS
AND AM CAPABLE OF MAKING THIS AFFIDAVIT. THE FACTS STATED IN THIS
AFFIDAVIT ARE WITHIN MY PERSONAL KNOWLEDGE AND ARE TRUE AND
CORRECT.
2. "I AM THE (TITLE) OF HUBBELL LIGHTING,
INC AND I AM DULY AUTHORIZED TO MAKE THIS AFFIDAVIT.
3. "AS OF[INSERT DATE],HUBBELL INCORPORATED HAD THE FOLLOWING JOB
POSITIONS:
EMPLOYEE ID NO. JOB POSITION OR TITLE ANNUAL SALARY
EMPLOYEE ID NO. JOB POSITION OR TITLE ANNUAL SALARY
TOTAL JOBS AVERAGE ANNUAL SALARY
DATED THIS DAY OF ,20_.
By: (Signature)
(Printed Name)
(Title)
SUBSCRIBED AND SWORN TO BEFORE ME ON THIS THE DAY OF
20_.
NOTARY PUBLIC, STATE OF TEXAS
No Text
CERTIFICATE OF INTERE
FORM 1295
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CERTIFICATE OF INTERESTED PARTIES FORM 1295
1 of 1
Complete Nos.1-4 and 6 if there are interested parties. OFFICE USE ONLY
Complete Nos.1,2,3,5,and 6 if there are no interested parties. CERTIFICATION OF FILING
1 Name of business entity filing form,and the city,state and country of the business entity's place Certificate Number:
of business. 2020-625201
Hubbell Lighting, Inc.
Greenville, SC United States Date Filed:
2 Name of governmental entity or state agency that is a party to the contract for which the form is 05/29/2020
being filed.
City of Round Rock Date Acknowledged:
06/08/2020
3 Provide the identification number used by the governmental entity or state agency to track or identify the contract,and provide a
description of the services,goods,or other property to be provided under the contract.
000000
Project Illuminate-establishing office for lighting controls business
4 Nature of interest
Name of Interested Party City,State,Country(place of business
(check applicable)
Controlling Intermediary
5 Check only if there is NO Interested Party.
X
6 UNSWORN DECLARATION
My name is and my date of birth is
My address is
(street) (city) (state) (zip code) (country)
I declare under penalty of perjury that the foregoing is true and correct.
Executed in County, State of on the day of -,20
(month) (year)
Signature of authorized agent of contracting business entity
(Declarant)
Forms provided by Texas Ethics Commission www.ethics.state.tx.us Version V1.1.3a6aaf7d