06-026 R - Economic Development Incentive Agreement with Centex TOWN OF PROSPER, TEXAS RESOLUTION NO. 06-26
A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF PROSPER, TEXAS HEREBY
AUTHORIZING THE MAYOR OF THE TOWN OF PROSPER, TEXAS TO EXECUTE AN ECONOMIC
DEVELOPMENT INCENTIVE AGREEMENT BETWEEN THE TOWN OF PROSPER AND CENTEX
HOMES(D/BIA)CTX BUILDERS SUPPLY.
NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE TOWN OF
PROSPER, TEXAS:
SECTION 1: The Mayor of the Town of Prosper, Texas is hereby authorized to execute, on behalf
of the Town Council of the Town of Prosper, Texas an Economic Development Incentive Agreement
between the Town of Prosper and Centex Homes(d/b/a) CTX Builders Supply.
SECTION 2: This Resolution shall take effect immediately upon its passage.
RESOLVED THIS THE 14th DAY OF MARCH, 2006.
harles Niswanger, Mayo
ATTE TO:
Shanae Jennings, wn Secretary
STATE OF TEXAS §
§ Economic Development Incentive Agreement
COUNTY OF COLLIN §
This Economic Development Incentive Agreement ("Agreement") is made by and between the Prosper
Economic Development Corporation ("PEDC") and Centex Homes (d/b/a) CTX Builders Supply ("Company"), acting
by and through their respective authorized officers.
WITNESSETH:
WHEREAS, the Company owns the real property described in Exhibit "A" (the "Land") and intends to
construct and operate an office/manufacturing and assembly facility containing at least 90,000 square feet of space and
two(2)covered dry storage facilities on the Land(the"Improvements");and
WHEREAS, the Company has advised the PEDC that a contributing factor that would induce the Company
to construct the Improvements would be an agreement by the PEDC to provide economic development grants to
Company to defray a portion of the costs of the Infrastructure;and
WHEREAS,the Development Corporation Act, Article 5190.6 TEX. REV. CIV. STAT. authorizes the PEDC
to provide economic development grants suitable for expenditures for infrastructure necessary to promote or develop
new or expanded industrial, manufacturing and business enterprises; and
WHEREAS, the PEDC has determined that making an economic development grant to the Company in
accordance with this Agreement will further the objectives of the PEDC, will benefit the Town of Prosper and the
Town's inhabitants and will promote local economic development and stimulate business and commercial activity in
the Town of Prosper.
NOW THEREFORE, in consideration of the foregoing, and other valuable consideration the sufficiency and
receipt of which is hereby acknowledged the parties agree as follows:
Article I
Definitions
Wherever used in this Agreement,the following terms shall have the meanings ascribed to them:
"PEDC"shall mean the Prosper Economic Development Corporation.
"Capital Investment"shall mean the total capitalized cost to the Company of the Project.
"Commencement Date"shall mean the date the first final permanent certificate of occupancy is issued by
the Town for the Company's occupancy for the Improvements.
"Commencement of Construction"shall mean that:(i)the plans have been prepared and all approvals
thereof required by applicable governmental authorities have been obtained for construction of the Improvements; (ii)
all necessary permits for the construction of the Improvements pursuant to the respective plans therefore having
been issued by all applicable governmental authorities; and (iii) grading of the Land and the construction of the
vertical elements of the Improvements have commenced.
"Completion of Construction"shall mean that: (i)the construction of the Improvements on the Land has
PEDC/Centex/CTX Economic Development Agreement— 1 63470
been substantially completed; and (ii)the first final permanent certificate of occupancy for the Company's occupancy
for the Improvements has been issued by the Town.
"Company"shall mean Centex Homes(d/b/a)CTX Builders Supply,a Nevada General Partnership.
"Effective Date"shall mean the last date of execution hereof.
"Employment Positions"shall mean full time Primary Jobs with benefits as further defined herein.
"Event of Bankruptcy or Insolvency"shall mean the dissolution or termination of Company's existence,
insolvency, employment of receiver for any part of Company's property and such appointment is not terminated
within ninety(90)days after such appointment is initially made, any general assignment for the benefit of creditors or
the commencement of any proceedings under any bankruptcy or insolvency laws by or against Company and such
proceedings are not dismissed within ninety(90)days after the filing thereof.
"Expiration Date"shall mean the April 1 following the fifth(59 Grant Period.
"First Year of Abatement"shall mean January 1 of the calendar year immediately following Completion of
Construction of the Improvements,unless otherwise agreed by the parties.
"Force Majeure"shall mean any contingency or cause beyond the reasonable control of a party including,
without limitation, acts of God or the public enemy, war, terrorism, riot, civil commotion, insurrection, government or de
facto govemmental action (unless caused by acts of omissions of the party), fires, explosions or floods, strikes,
slowdowns or work stoppages.
"Grants"shall individually and collectively mean the Sales Tax Grants and the Rail Spur Grant.
"Grant Period"shall mean a full calendar year beginning on January 1 of the calendar year immediately
following the Commencement Date,except that the first Grant Period shall be from the Commencement Date through
and including December 31 of the first full calendar year following the Commencement Date. For example, assume
the Commencement Date is June 15, 2010 the first Grant Period would be from June 15, 2010 through and including
December 31, 2011. Thereafter, the second Grant Period would be from January 1, 2012 through and including
December 31,2012.
"Impositions"shall mean all taxes,assessments, use and occupancy taxes,charges,excises, license and
permit fees, and other charges by public or governmental authority, general and special, ordinary and extraordinary,
foreseen and unforeseen,which are or may be assessed,charged, levied,or imposed by any public or governmental
authority on the company with respect to the improvements or any property or any business owned by company
within the Town.
"Improvements"shall mean the construction of an office/manufacturing and assembly facility containing at least
90,000 square feet of space and two(2)covered dry storage facilities on the Land (and other ancillary facilities, such as
reasonably required parking and landscaping more fully described in the submittals filed by Company with the Town from
time to time in order to obtain a building permit).
"Infrastructure"means infrastructure necessary to promote or develop the Improvements limited to streets
and roads, rail spurs,site improvements, water and electric utilities,gas utilities, drainage and related improvements,
and telecommunications and internet improvements including but not limited to: (1) the design, engineering and
construction of streets, roads, bridges, rail road spur improvements on or off site of the Improvements (and related
type of improvements) necessary for the Improvements or for access or improved access to the Land; (2)the design,
PEDC/Centex/CTX Economic Development Agreement—2 63470
engineering, construction and installation of water, electric and gas utilities on or off site of the Improvements
necessary for the Improvements, and any portion of the underlying facilities necessary to extend, enlarge, support or
provide such utility systems to the Improvements; (3) the design, engineering, construction and installation of
drainage and related improvements on or off site of the Improvements(e.g. storm sewers, detention ponds, retention
ponds, drainage pipes, culverts, over-sizing of facilities) necessary for the Improvements; and (4) the design,
engineering, construction and installation of telecommunication and internet improvements, on or off the site of the
Improvements, which may include telephone, radio, wireless or other communication systems, fiber optics or other
types of networks, cabling, computers and high technology equipment, or software necessary to provide, enlarge,
expand or improve the telecommunications and internet improvements for the Improvements.
"Land"shall mean that real property located within the Tax Abatement Reinvestment Zone No. 1 (CTX)and
being further described in Exhibit"A".
"Payment Request"shall mean a written request from the Company to the PEDC for payment of the Rail Spur
Grant and/or the annual Sales Tax Grant, as the case may be, accompanied by copies of invoices, bills, receipts and
such other information as may be reasonably requested by PEDC to document Company expenditures for the payment of
costs for the design and construction incurred by the Company for Infrastructure or the Railroad Spur, as the case may
be.
"Project"shall collectively mean the Land and the Improvements,following construction thereof.
"Primary Jobs"shall have the same meaning as assigned by Article 5190.6 Vemon's Texas Civil Statutes and
shall mean Employment Positions located at the Improvements.
"Railroad Spur"shall mean the design and construction of a railroad spur connecting the Project to the
Burlington Northern Santa Fe railroad corridor more fully described in the submittals filed by Company with the Town and
other governmental agencies having jurisdiction over the Project,from time to time,in order to obtain permits.
"Rail Spur Grant"shall mean an economic development grant in an amount equal to the lesser of:(i)25%of the
actual total costs incurred and paid by Company for the Rail Spur;and(ii)$62,500.00.
"Related Agreements"shall mean that certain economic development agreement by and between the Town and
the Company dated of approximate even date herewith and that certain tax abatement agreement by and between the
Town and the Company of approximate even date herewith.
"Required Use"shall mean the Company's continuous operation of office/manufacturing and assembly facility
containing at least 90,000 square feet of space at the Improvements, subject to temporary cessations of such operation
as a result of an event of a Force Majeure.
"Sales and Use Tax"shall mean the one percent(1%)sales and use tax imposed by the Town pursuant to
Chapter 321, Tax Code (it being expressly understood that the Town's Sales Tax Receipts are being used only as a
measurement for the PEDC's participation) on the sale of Taxable Items by the Company consummated at the
Improvements.
"Sales Tax Certificate"shall mean a certificate or other statement in a form reasonably acceptable to the
PEDC setting forth the Company's collection of Sales and Use Tax received by the Town from the State of Texas for
the sale of Taxable Items by Company consummated at the Improvements for the applicable Grant Period which are
to be used to determine Company's eligibility for a Sales Tax Grant,together with such supporting documentation as
required herein,and as PEDC may reasonably request.
PEDC/Centex/CTX Economic Development Agreement—3 63470
"Sales Tax Grant(s)"shall mean annual economic development grants in the lesser amount of:(i)twenty-five
percent (25%) of the total costs incurred and paid by Company for the Improvements and Infrastructure; and (ii) an
amount equal to twenty-five percent(25%)of of the Town's Sales Tax Receipts for the applicable Grant Period to be
paid to the Company for the reimbursement of a portion of the costs incurred and paid by Company for the Improvements
and Infrastructure as set forth herein.
"Sales Tax Receipts"shall mean the Town's receipts from the State of Texas from the collection of Sales
and Use Tax by the Company for the sale of Taxable Items by Company consummated at the Improvements for the
applicable Grant Period.
"State of Texas"shall mean the office of the Texas Comptroller,or its successor.
"Tangible Personal Property"shall mean tangible personal property,equipment and fixtures, including
supplies and inventory,owned or leased by the Company that is added to the Project subsequent to the execution of
the Tax Abatement Agreement by and between the Town and the Company.
"Taxable Items"shall have the same meaning assigned by Chapter 151,TEX.TAX CODE, as amended.
"Taxable Value"shall mean the appraised value as certified by the central appraisal district,or its successor
entity, as of January 1 of a given calendar year.
"Town"shall mean the Town of Prosper,Texas.
Article II
Term
The term of this Agreement shall begin on the Effective Date and continue until the Expiration Date, unless
sooner terminated as provided herein.
Article Ill
Economic Development Agreement
3.1 Sales Tax Grants. (a) Subject to the Company's obligation to repay the Grants in Sections 5.2
and 5.3 hereof, and the Company's continued satisfaction of all the terms and conditions of this Agreement, the
PEDC agrees to provide Company with five(5)annual Sales Tax Grants for the reimbursement of costs incurred and
paid by Company for Improvements and Infrastructure provided: (i)the Company has a total sale of Taxable Items by
the Company consummated at the Improvements of at least $48 Million Dollars for each Grant Period; or (ii) the
cumulative sale of Taxable Items by the Company consummated at the Improvements is equal to or greater than the
minimum cumulative amounts for the applicable Grant Period as set forth in the schedule below:
Minimum Cumulative Taxable Sales over the Five-Year Grant Period
First Grant Period $48 Million Dollars
Second Grant Period $96 Million Dollars
Third Grant Period $144 Million Dollars
Fourth Grant Period $192 Million Dollars
Fifth Grant Period $240 Million Dollars
In the event the cumulative sale of Taxable Items by the Company consummated at the Improvements for any Grant
Period is less than the minimum amounts set forth in the schedule above for the applicable Grant Period no Sales
PEDC/Centex/CTX Economic Development Agreement—4 63470
Tax Grant shall be due and paid to the Company for such Grant Period, however any unpaid Sales Tax Grants shall
be carried forward to the succeeding Grant Periods and will be paid when the cumulative total of the sale of Taxable
Items by the Company consummated at the Improvements is equal to or greater than the minimum amounts set forth
in the schedule above for the succeeding Grant Periods. For illustration purposes only, assume that the cumulative
sale of Taxable Items by the Company consummated at the Improvements for the first Grant Period is $36 Million
Dollars then no Sales Tax Grant shall be due and payable for the first Grant Period, however,further assume that the
cumulative amount of the sale of Taxable Items by the Company consummated at the Improvements for the first and
second Grant Period is$96 Million Dollars or greater,then the Company will be paid the Sales Tax Grant for the first
and second Grant Periods. In the event the cumulative sale of Taxable Items by the Company consummated at the
Improvements for the second Grant Period is $50 Million Dollars then the Company is paid the Sales Tax Grant that
would have been paid for the first Grant Period and the amount of the Sales Tax Grant for the second Grant Period is
carried forward.
(b) Sales Tax Grant Payment. The Sales Tax Grants shall be paid within thirty (30) days after
PEDC's receipt of a Payment Request from the Company on April 1 following each of the five (5) Grant Periods. For
example assume the Commencement Date is June 15, 2010, then the first Grant Period would be from June 15,
2010 through and including December 31, 2011, and the first of the five (5) Sales Tax Grants would be paid within
thirty(30)days after April 1,2012.
3.2 Rail Spur Grant: (a) Subject to the Company's obligation to repay the Grants in Sections 5.2 and
5.3 hereof, and the Company's continued satisfaction of all the terms and conditions of this Agreement, the PEDC
agrees to provide Company with the Rail Spur Grant to be paid within thirty (30) days after PEDC's receipt of a
Payment Request from Company following April 1 of the calendar year following the first Grant Period during the term
of this Agreement (and prior to the Expiration Date) when the cumulative sale of Taxable Items by the Company
consummated at the Improvements is at least$240 Million Dollars($240,000,000.00).
(b) The obligation of the PEDC to pay the Rail Spur Grant shall not survive termination of this
Agreement. In the event the Rail Spur Grant has not been fully paid by the PEDC prior to the Expiration Date, the
obligation of the PEDC to provide the Rail Spur Grant shall expire on the date of termination of this Agreement.
(c) The parties agree that the reimbursement to the Company for the Rail Spur costs is subject to the
PEDC's receipt of sales and use tax received from the State of Texas for the sale of Taxable Items by the Company
consummated at the Improvements during the term of this Agreement. In the event that such sales and use tax
receipts are insufficient during the term of this Agreement to reimburse the Company for the Rail Spur costs incurred
and paid by Company, nothing in this Agreement shall be construed to obligate the PEDC to approve reimbursement
for such costs from any other source of funds or to require the PEDC to pay such deficit to the Company.
(d) The payment of the Rail Spur Grant shall be conditioned on written approval and authorization from
the BNSF Railway Company of the location and construction of the Rail Spur by the Company(BNSF Authorization).
The Company shall provide a copy of the BNSF Authorization to the PEDC as a condition precedent to the payment
of the Rail Spur Grants.
3.3 Current Revenue. (a) The Grants made hereunder shall be paid solely from lawful available
funds, which have been appropriated by the PEDC. Under no circumstances shall PEDC's obligations hereunder
be deemed to create any debt within the meaning of any constitutional or statutory provision. All payments of the
Grants are subject to appropriation of funds for such payments in the budget year for which they are made. The
installments shall be paid solely from annual appropriations from the general funds of the PEDC or from such other
funds of the PEDC as may be legally set aside for such purpose consistent with Article III, Section 52(a) of the
Texas Constitution,as amended.
PEDC/Centex/CTX Economic Development Agreement—5 63470
(b) The PEDC shall not be obligated to pay any commercial bank, lender or similar institution for any
loan or credit agreement made by Company. None of the PEDC's obligations under this Agreement shall be
pledged or otherwise encumbered in favor of any commercial lender and/or similar financial institution.
3.4 Grant Funds. Under no circumstances shall any of the Grants include any receipts from the
Town's imposition and collection of Sales and Use Tax for the benefit of the PEDC for the sale of Taxable Items at
any location, business,establishment,or entity,consummated in the Town other than from the sale of Taxable Items
by Company consummated at the Improvements.
3.5 Amended Returns. In the event the Company files an amended Sales and Use Tax return, or
report, or if additional Sales and Use Tax is due and owing by Company to the State of Texas, as determined by or
as approved by the State of Texas affecting Sales Tax Receipts for a previous Grant Period, then the Sales Tax
Grant payment for the Grant Period immediately following the Town's receipt of Sales Tax Receipts from the State of
Texas shall be adjusted accordingly. As a condition precedent to payment of such adjustment, Company shall
provide PEDC with a copy of any such amended Sales and Use Tax report or return, and the approval thereof by the
State of Texas.
3.6 Refunds. The Company shall promptly, but in no case later than thirty(30)days, notify the PEDC
in writing of any adjustments found, determined or made by Company, the State of Texas or by an outside audit that
results or will result in either a refund or the payment of additional Sales and Use Tax to the Town and/or the PEDC.
Such notification shall also include the amount of any such adjustment in Sales and Use Tax Receipts. In the event
the State of Texas determines that the Town and/or the PEDC erroneously received Sales Tax Receipts, or that the
amount of Sales and Use Tax paid to the Town and/or the PEDC exceeds the correct amount of Sales and Use Tax
for a previous Grant Period,for which the Company has received a Sales Tax Grant, the Company shall,within thirty
(30) days after receipt of notification thereof from the PEDC specifying the amount by which such Sales Tax Grant
exceeded the amount to which the Company was entitled pursuant to such State of Texas determination, pay such
amount to the PEDC. Alternatively the PEDC may at its option adjust the Sales Tax Grant payment(s)for the Grant
Period(s) immediately following such State of Texas determination for such incorrect amount. As a condition
precedent to payment of such refund or adjustment, the PEDC shall provide Company with a copy of such
determination by the State of Texas.
3.7 Confidentiality. The PEDC agrees, to the extent allowed by law, to keep all information and
documentation received from the State of Texas pursuant to this Agreement hereof("Confidential Tax Information")
confidential. The PEDC will only provide access to the Confidential Tax Information to its employees, independent
contractors or agents on a "need-to-know" basis. The PEDC will use the Confidential Tax Information solely for the
purposes of determining the Company's entitlement to a Sales Tax Grant, a refund or to determine if any additional
Sales and Use Tax is due.The PEDC will not,without the Company's prior written authorization,directly or indirectly,
intentionally or inadvertently: (a) disclose to any other person except as may be required by law (other than as
expressly permitted above) the Confidential Tax Information; (b) copy, photograph, photocopy, reduce to writing or
otherwise reproduce or duplicate the Confidential Tax Information in any form or medium, electronic or otherwise
except in connected with the purposes provided herein. The Company's Waiver of Sales Tax Confidentiality is solely
for the limited purpose of allowing the PEDC to confirm the Company's entitlement to Sales Tax Grants, PEDC's
entitlement to refunds, or the Company's obligation to pay additional Sales and Use Tax during the term of this
Agreement. In the event the PEDC is requested or becomes legally compelled (by deposition, interrogatory, request
for documents, subpoena,civil investigative demand or similar process)to disclose any Confidential Tax Information,
the PEDC shall provide the Company with prompt written notice of such request or requirement so that the Company
may seek a protective order or other appropriate remedy and/or waive compliance with the terms of this Section.
3.8 Waiver of Sales Tax Confidentiality. The Company shall provide the PEDC, and maintain during
the term of this Agreement a Waiver of Sales Tax Confidentiality which authorizes the State of Texas to release to
PEDC/Centex/CTX Economic Development Agreement—6 63470
the PEDC the Sales and Use Tax information pertaining to the Company for the sale of Taxable Items at the
Improvements during the term of this Agreement substantially in the form of Exhibit"B". The Company will continue
to maintain an effective Waiver of Sales Tax Confidentiality during the term of this Agreement. The Waiver of Sales
Tax Confidentiality shall include but not be limited to the following documentation and may include the following:
a. A schedule detailing the amount of Sales and Use Tax collected by the Company, and
paid to the State of Texas as a result of the sale of Taxable Items by the Company consummated at the
Improvements during the term of this Agreement;
b. A copy of all Sales and Use Tax returns and reports, direct payment and self-assessment
returns, Sales and Use Tax prepayment returns,direct payment permits and reports, sales and use tax audit
assessments, including amended sales and use tax returns or reports, filed by the Company during the
term, showing Sales and Use Tax collected (including sales and use tax paid directly to the State of Texas
pursuant to a direct payment certificate) by the Company for the sale of Taxable Items consummated at the
Improvements during the term of this Agreement;and
c. Information concerning any refund or credit received by the Company of Sales or Use Tax
paid or collected by the Company(including any Sales and Use Tax paid directly to the State pursuant to a
direct payment permit) which has previously been reported by the Company as Sales and Use Tax paid or
collected.
Article IV
Conditions to Economic Development Grants
The PEDC's obligation to pay the Grants hereunder shall be conditioned upon the Company's compliance
and satisfaction of each of the following conditions.Company shall fully comply with each of the following conditions.
4.1 Sales Tax Certificate. During the term of this Agreement, the Company shall within thirty (30)
days after the end of each calendar year, provide the PEDC with a Sales Tax Certificate. The PEDC shall have no
duty to calculate the Sales Tax Receipts or determine Company's entitlement to any Grant, or pay any Sales Tax
Grant during the term of this Agreement until such time as Company has provided the PEDC a Sales Tax Certificate
for the applicable Grant Period. The PEDC may, but is not required to provide Company with a form for the Sales
Tax Certificate required herein. At the request of the PEDC, the Company shall provide such additional
documentation as may be reasonably requested by PEDC to evidence,support and establish the Sales and Use Tax
paid and collected (including Sales and Use Tax paid directly to the State of Texas pursuant to a direct payment
permit) by Company for the sale of Taxable Items consummated at the Improvements and received by Town on
behalf of the PEDC from the State of Texas. The Sales Tax Certificate shall at a minimum contain, include or be
accompanied by the following:
a. A schedule detailing the amount of Sales and Use Tax collected by the Company, and
paid to the State of Texas as a result of the sale of Taxable Items by the Company consummated at the
Improvements for the applicable Grant Period;
b. A copy of all Sales and Use Tax returns and reports, direct payment and self-assessment
returns, Sales and Use Tax prepayment returns,direct payment permits and reports,sales and use tax audit
assessments, including amended sales and use tax returns or reports, filed by the Company for the
applicable Grant Period, showing Sales and Use Tax collected (including sales and use tax paid directly to
the State of Texas pursuant to a direct payment certificate) by the Company for the sale of Taxable Items
consummated at the Improvements for the applicable Grant Period;
PEDC/Centex/CTX Economic Development Agreement—7 63470
c. Information concerning any refund or credit received by the Company of Sales or Use Tax
paid or collected by the Company(including any Sales and Use Tax paid directly to the State pursuant to a
direct payment permit)which has previously been reported by the Company as Sales and Use Tax paid or
collected.
4.2 As a condition to the payment of any Sales Tax Grant hereunder, PEDC shall have received a
Sales Tax Certificate and Payment Request for the applicable Grant Period for which payment of a Sales Tax Grant
is requested.
4.3 Subject to events of casualty,condemnation, or Force Majeure,for so long as the Company owns the
Improvements the Company agrees to maintain the Improvements in substantial accordance with all applicable state and
local laws, codes, and regulations for a period of not less than ten (10) years beginning on the Commencement Date.
Following the Commencement Date and continuing thereafter for a period of ten (10) consecutive years or earlier
termination, the Company shall continuously own or lease, and occupy the Improvements, and that the Improvements
shall not be used for any purpose other than the Required Use, and that the Company shall not allow the operation of the
Improvements in conformance with the Required Use to cease for more than thirty(30)days except in connection with,
and to the extent of an event of a Force Majeure.
4.4 The Company shall, as a condition precedent to the payment of the Rail Spur Grant, provide the
PEDC with the applicable Payment Request.
4.5 The Company shall not have an uncured breach or default of this Agreement or any one or more of the
Related Agreements.
4.6 The Company shall,subject to events of Force Majuere, cause Commencement of Construction of
the Improvements to occur on or before July 31, 2009, and to cause Completion of Construction of the Improvements
to occur on or before August 1,2010.
4.7 The Company agrees that within six (6) months after the Commencement Date and continuing on
each anniversary date of the Commencement Date thereafter during the term of this Agreement,to fill and maintain,or to
cause its affiliates and onsite contractors to fill and maintain at least 125 Employment Positions and agency-sourced
personnel ("temp-to-perm" employees that work full-time without benefits until hired as regular employees) at the
Improvements with a total annual payroll of not less than $5 Million Dollars. In the event of voluntary or involuntary
termination of an employee, which termination causes the number of Employment Positions to fall below the number
required pursuant to this Agreement, the Company shall not be in default provided the required number of
Employment Positions is re-established within sixty (60) days of the employee termination. To receive credit for an
Employment Position, the employee must be retained for a period not less than forty-five (45) consecutive days,
provided, however,the failure of a replacement employee to remain employed for such forty-five(45)day period shall
not result in a Company default to re-establish the required number of Employment Positions as provided herein.
The Company shall, within thirty (30) days after each anniversary date of the Commencement Date provide the
PEDC with copies of employment records and such other information as may be reasonably requested by PEDC to
document compliance with the required Employment Positions.
4.8 The combined Taxable Value of the Improvements and the Tangible Personal Property shall be at
least Nine Million Dollars ($9,000,000.00) (the "Minimum Taxable Value") as of the First Year of Abatement and as of
January 1 of each calendar year thereafter during the term of this Agreement, provided however following the First Year
of Abatement the Minimum Taxable Value shall be reduced by $428,571.00 each year thereafter so that the Minimum
Taxable Value shall be as set forth in the schedule below:
PEDC/Centex/CTX Economic Development Agreement—8 63470
Minimum Taxable Value
Second Year of Abatement $8,571,429.00
Third Year of Abatement $8,142,858.00
Fourth Year of Abatement $7,714,287.00
Fifth Year of Abatement $7,285,716.00
4.9 The minimum cumulative sale of Taxable Items by Company consummated at the Improvements
shall through the end of the fifth Grant Period and prior to the Expiration Date be $240 Million Dollars
($240,000,000.00).
Article V
Termination
5.1 This Agreement shall terminate upon any one of the following:
(a) by written agreement of the parties;
(b) Expiration Date;
(c) by either party in the event the other party breaches any of the terms or conditions of this
Agreement and such breach is not cured within thirty(30)days after written notice thereof;
(d) by PEDC, if Company suffers an Event of Bankruptcy or Insolvency;
(e) by PEDC, if any Impositions owed to the PEDC or the State of Texas by Company shall
become delinquent (provided, however the Company retains the right to timely and properly
protest and contest any such Impositions); and
(f) by PEDC, if any subsequent Federal or State legislation or any decision of a court of competent
jurisdiction declares or renders this Agreement invalid, illegal or unenforceable.
5.2 Except as provided in Section 5.3 below, in the event the Agreement is terminated by the PEDC
pursuant to Section 5.1(c), (d), (e)or(f) the Company shall immediately repay to the PEDC an amount equal to the
Grants previously paid by the PEDC to the Company, plus interest at the rate periodically announced by the Wall
Street Journal as the prime or base commercial lending rate, or if the Wall Street Journal shall ever cease to exist or
cease to announce a prime or base lending rate, then at the annual rate of interest from time to time announced by
Citibank, N.A. (or by any other New York money center bank selected by the PEDC)as its prime or base commercial
lending rate,from the Effective Date until paid.
5.3 In the event the Agreement is terminated by the PEDC pursuant to Section 5.1(c) for an uncured
default by the Company under Section 4.3 which occurs at anytime beginning with the sixth (6th) year following the
Commencement Date through and including the tenth (10th) year following the Commencement Date, the Company
shall immediately repay to the PEDC an amount equal to the fifty percent(50%)of the Grants previously paid by the
PEDC to the Company, plus interest at the rate periodically announced by the Wall Street Journal as the prime or
base commercial lending rate, or if the Wall Street Journal shall ever cease to exist or cease to announce a prime or
base lending rate, then at the annual rate of interest from time to time announced by Citibank, N.A. (or by any other
New York money center bank selected by the PEDC)as its prime or base commercial lending rate,from the Effective
Date until paid.
PEDC/Centex/CTX Economic Development Agreement—9 63470
Article VI
Miscellaneous
6.1 Binding Agreement. This Agreement shall be binding upon and inure to the benefit of the parties
to it and their respective heirs, administrators, executors, and successors. This Agreement may not be assigned
without the PEDC's prior written consent.
6.2 Limitation on Liability. It is acknowledged and agreed by the parties that the terms hereof are
not intended to and shall not be deemed to create a partnership or joint venture among the parties. It is understood
and agreed between the parties that Company, in satisfying the conditions of this Agreement, has acted
independently, and PEDC and its employees assumes no responsibilities or liabilities to third parties in connection
with these actions. Company agrees to indemnify and hold harmless the PEDC and its employees from all such
claims, suits, and causes of actions, liabilities and expenses, including reasonable attorney's fees, of any nature
whatsoever arising out of the Company's performance of the conditions under this Agreement.
6.3 Authorization. Each party represents that it has full capacity and authority to grant all rights and
assume all obligations that is granted and assumed under this Agreement.
6.4 Notice. Any notice required or permitted to be delivered hereunder shall be deemed received
three (3) days thereafter sent by United States Mail, postage prepaid, certified mail, return receipt requested,
addressed to the party at the address set forth below or on the day actually received as set by courier or otherwise
hand delivered.
If intended for PEDC,to: With a copy to:
Karen Gandy Peter G.Smith
Executive Director Nichols,Jackson, Dillard,Hager&Smith,L.L.P.
Prosper Economic Development Corporation 1800 Lincoln Plaza
121 W.Broadway 500 North Akard
P.0.Box 1060 Dallas Texas 75201
Prosper,Texas 75078-1060
If intended for Company,to: With copy to:
Centex Homes(d/b/a)CTX Builders Supply Centex Homes
2800 Surveyor Blvd., Bldg 3 P. 0. Box 199000
Carrollton,TX. 75006 Dallas,TX. 75201-1516
Attn: Robert E. Graham,CPA Attn: Gregory Packer
Chief Financial Officer Assistant General Counsel
6.5 Entire Agreement. This Agreement is the entire Agreement between the parties with respect to
the subject matter covered in this Agreement. There is no other collateral oral or written Agreement between the
parties that in any manner relates to the subject matter of this Agreement, except as provided in any Exhibits
attached hereto. All reasonable attorneys' fees incurred by the Town for preparation or review of any revision,
modification,or amendment of this Agreement proposed by Owner following the original execution of this Agreement and
all reasonable attorneys'fees incurred for preparation or review of other Owner proposed additional or related documents
shall be at Owners'sole cost.
6.6 Governing Law. This Agreement shall be governed by the laws of the State of Texas; and venue
for any action concerning this Agreement shall be in the State District Court of Collin County, Texas. The parties
agree to submit to the personal and subject matter jurisdiction of said Court.
PEDC/Centex/CTX Economic Development Agreement— 10 63470
6.7 Amendment. This Agreement may be amended by the mutual written agreement of the parties.
6.8 Legal Construction. In the event any one or more of the provisions contained in this Agreement
shall for any reason be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or
unenforceability shall not affect other provisions, and it is the intention of the parties to this Agreement that in lieu of
each provision that is found to be illegal, invalid, or unenforceable, a provision be added to this Agreement which is
legal, valid and enforceable and is as similar in terms as possible to the provision found to be illegal, invalid or
unenforceable.
6.9 Recitals. The recitals to this Agreement are incorporated herein.
6.10 Counterparts. This Agreement may be executed in counterparts. Each of the counterparts shall
be deemed an original instrument, but all of the counterparts shall constitute one and the same instrument.
6.11 Exhibits. Any exhibits to this Agreement are incorporated herein by reference for all purposes
wherever reference is made to the same.
6.12 Survival of Covenants. Any of the representations, warranties, covenants, and obligations of the
parties, as well as any rights and benefits of the parties, pertaining to a period of time following the termination of this
Agreement shall survive termination.
Signature page to follow
PEDC/Centex/CTX Economic Development Agreement— 11 63470
EXECUTED on this 11 day of ,2006.
PROSPER ECONOMIC DEVELO NT CORPORATION
Apr Pugs, SAFtA P.THETFORD
Notary Public,State of Texas By:
* * My Commission J. ay Sm h, II,President
orr, April 24,2010 Board of D rectors
th
EXECUTED on this 1'1 day of fir I 1 ,2006.
Centex Homes(d/b/a) CTX Builders Supply
A Nevada General Partnership
By: me eal Estate Cor rati , i Managing Partner
By:
N ine: clet
T le: c%`l9;
PEDC/Centex/CTX Economic Development Agreement— 12 63470
PEDC's Acknowledgment
State of Texas §
§
County of Collin §
This instrument was acknowledged before me on the /1 day of , 2006, by Ray Smith,
President of the Prosper Economic Development Corporation,on behalf of ai rporati .
otary Public,State of Texas t,/
My Commission Expires: 1 — ` to
'
SARA P.THETFORD
Public,State of Texas
Company's Acknowledgment * �\ * Notary
NoMta E S
YCommission
%torte April 24,2010
State of Texas ' ' .
§
County of Dallas §Tar ` l
This instrument was acknowledged before me on the d IJ ay of fYl / , 200 by
� � !Centex Homes (d/b/a) CTX Builders Supply, a Nevada General Partnership, the 'U1 of
Centex Real Estate Corporation, its Managing Partner.
-s- ill 0—0 fir'0
Notary Public, State of Texas2-L
'Q
My Commission Expires: 1O— O
is 7,, C. ANNETTE WILLIAMS
:. ' Notary Public,State of Texas
1 My Commission Expires
-1:4 1`'~
October 29,2001
9 J - a 1
PEDC/Centex/CTX Economic Development Agreement— 13 63470
Exhibit"A"
Legal Description of the Land
Description of a 50.8646 acre tract of land out of the Collin County School Survey,Abstract Number 147, in the Town
of Prosper, Collin County, Texas; said tract being a portion of a 102.246 acre tract conveyed to Prosper Industrial
102 Joint Venture by General Warranty Deed recorded in Volume 5593, Page 2451, Deed Records, Collin County,
Texas;said tract being more particularly described by metes and bounds as follows:
COMMENCING, at a 1/2-inch rod found for the intersection of the centerline of County Road No. 4 and the west
right-of-way line of the Burlington Northern Santa Fe Railroad (a 100 foot right-of-way); said point being also the
northeast corner of a 19.648 acre tract of land conveyed to Hope Lumber & Supply Company, L.P. by General
Warranty Deed recorded in Volume 5220, Page 3569, Deed Records, Collin County,Texas;
THENCE, South 11 degrees 57 minutes 00 seconds West, with the west right-of-way line of said railroad and the
east line of said 19.648 acre tract, a distance of 1250.00 feet to a 5/8-inch iron rod with yellow plastic cap stamped
"GSES INC RPLS 4804" set for the southeast corner of said 19.648 acre tract; said point being also the POINT OF
BEGINNING;
THENCE, South 11 degrees 57 minutes 00 seconds West, with the west right-of-way line of said railroad, a distance
of 1449.50 feet to a 5/8-inch iron rod with yellow plastic cap stamped"GSES INC RPLS 4804" set for the southeast
corner of said 102.246 acre tract;said point being also a corner of the west right-of-way line of said railroad;
THENCE, North 89 degrees 31 minutes 22 seconds West, with said right-of-way line, at a distance of 153.05 feet
pass the northeast corner of a 59.33 acre tract conveyed to The Mahard 2003 Partnership, L.P. by Special Warranty
Deed recorded in Volume 5670, Page 1918, Deed Records, Collin County, Texas; continuing with the north line of
said 59.33 acre tract, in all, a distance of 1427.68 feet to a 3/4-inch iron rod found for the southwest corner of said
102.246 acre tract and the northwest corner of said 59.33 acre tract; said point being the northeast corner of a
79.221 acre tract conveyed to 183 Land Corporation, Inc. by Special Warranty Deed recorded in County Clerk File
No. 97-0005168, Deed Records, Collin County, Texas; said point being also the southeast corner of a 127.854 acre
tract conveyed to Prosper Church Land, L.P. by Special Warranty Deed with Vendor's Lien recorded in Volume 5823,
Page 6264,Deed Records,Collin County,Texas;
THENCE, North 00 degrees 47 minutes 13 seconds East, with the east line of said 127.854 acre tract, a distance of
1406.83 feet to a 5/8-inch iron rod with yellow plastic cap stamped"GSES INC RPLS 4804"set for corner;
THENCE, South 89 degrees 59 minutes 00 seconds East, at a distance of 608.55 feet pass the southwest corner of
an 11.23 acre tract conveyed to Bruce Miller Nursery, Inc. by Special Warranty Deed recorded in Volume 4862, Page
2099, Deed Records, Collin County, Texas; continuing, with the south line of said 11.23 acre tract, at an additional
distance of 400.00 feet pass the southeast corner of said 11.23 acre tract and the southwest corner of said 19.648
acre tract;continuing with the south line of said 19.648 acre tract, in all, a distance of 1708.43 feet to the POINT OF
BEGINNING;
CONTAINING,2,215,662 square feet or 50.8646 acres of land, more or less.
Exhibit"B"
Waiver of Sales Tax Confidentiality
Date:
I authorize the Comptroller of Public Accounts to release sales tax information pertaining to the taxpayer indicated
below to the Town of Prosper,Texas. This waiver applies only to our place of business located in Prosper,Texas.
Name of Taxpayer as Shown on Texas Sales Tax Permit
Taxpayer Mailing Address
Physical Location of Business Permitted for Sales Tax in Prosper,Texas
Texas Taxpayer ID Number Tax Outlet Number
Authorized Signature
Printed Name
Position Title
Telephone Number
The authorized signature must be an owner, officer, director, partner, or agent authorized to sign a Texas Sales Tax
Return. If you have any questions concerning this waiver of confidentiality, please contact the Texas Comptroller of
Public Accounts at 800.531.5441.