HomeMy WebLinkAboutRes 2023-06-1459 Chapter 380 Agreement- Anacapri Laguna Azure, LLCRESOLUTIONNO. 2023-oio— 45q
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANNA, TEXAS
APPROVING A CHAPTER 380 AGREEMENT WITH ANACAPRI LAGUNA AZURE,
LLC
WHEREAS, the City Council of the City of Anna, Texas and AnaCapri Laguna Azure,
LLC desire to enter into a Chapter 380 Agreement as agreed upon in the Development Agreement
approved on October 12, 2021; and
WHEREAS, the City is authorized to apportion certain portions of sales tax under Chapter
380 of the Texas Local Government Code as part of a direct payment program under 34 TAC §
3.288;
NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF ANNA, TEXAS:
SECTION 1. Findings. The findings set forth above are incorporated herein for all
purposes as if set forth in full.
SECTION 2. Approval of Project and Agreement
The City Council of the City of Anna, Texas hereby approves the Chapter 380 Agreement
with AnaCapri Laguna Azure, LLC and the City of Anna, Texas ("Agreement') attached hereto as
Exhibit 1, incorporated herein for all purposes, and authorizes the Mayor Pro Tem to execute the
same on its behalf, subject to approval as to form by legal counsel for the City, said Agreement to
be effective upon its passage and as set forth in said Agreement.
SECTION 3. Administration
The City hereby authorizes the City Manager or his designee to administer the Agreement.
PASSED, APPROVED AND ADOPTED by theaiounclof the City of Anna,
Texas, on this the 27th day of June 2023.
Lee ller, Mayor Pro Tem
A'r'M(ZT-
Page 1
CHAPTER 380 GRANT AGREEMENT BY
AND BETWEEN THE CITY OF ANNA, TEXAS
AND ANACAPRI LAGUNA AZURE, LLC
This CHAPTER 380 GRANT AGREEMENT ("Agreement") is made by and between
The City of Anna, Texas ("C", also referred to as "Grantor") and ANACAPRI LAGUNA
AZURE, LLC, a Wyoming limited liability company (the "Company"), acting by and through their
respective authorized officers and representatives.
WHEREAS, the City Council of the City of Anna, Texas ("City Council") has investigated
and determined that it is in the best interest of the City and its citizens to encourage programs,
including programs for making loans and grants of public money to promote local economic
development and stimulate business and commercial activity in the City pursuant to Chapter 380,
Texas Local Government Code, as amended ("Chapter 380"); and
WHEREAS, the Company will be engaged in the business of purchasing building
materials for its use on construction projects within the City; and
WHEREAS, the Company has advised that it would like to partner with the City, and that
a contributing factor that would induce the Company to purchase items using a Texas Direct
Payment Permit and generate economic development and local use tax revenue for the City, that
would otherwise not be available to the City, would be an agreement by the Grantor to provide an
economic development grant to the Company; and
WHEREAS, the Company desires to purchase and use new building materials within the
City that will generate additional economic development and use tax revenue for the City; and
WHEREAS, the City Council has investigated and determined that the Company meets
the criteria for providing the grants (hereinafter defined), pursuant to Chapter 380, based on,
among other things, the Company: (i) acquiring properties for development, and constructing
improvements; (ii) adding taxable improvements to real property in the City; and (iii) creating
employment opportunities for the citizens of Anna ("ApDroved Pro; ectIT and
WHEREAS, the City has concluded that the Approved Project qualifies for a Grant under
Chapter 380; and
WHEREAS, with the approval of this Agreement, the City hereby establishes a program
authorized by Chapter 380 to encourage and induce the generation of local use tax; and
WHEREAS, the Grantor has determined that making an economic development grant to
the Company in accordance with this Agreement will further the objectives of the Grantor, will
benefit the City and the City's inhabitants and will promote local economic development and
stimulate business and commercial activity in the City;
NOW THEREFORE, in consideration of the foregoing, and on the terms and conditions
hereinafter set forth, the sufficiency of which is hereby acknowledged, the parties agree as follows:
CHAPTER 3 80 GRANT AGREEMENT BY AND BETWEEN
THE CITY of ANNA AND ANACAPRI LAGUNA AZURE, LLC - PAGE 1
017871.00000914856-1770-3786s1
ARTICLE I
DEFINITIONS
1.01 For purposes of this Agreement, each of the following terms shall have the meaning
set forth herein unless the context clearly indicates otherwise:
"C�" and "Grantor" shall mean The City of Anna, Texas.
"Company" shall mean Anacapri Laguna Azure, LLC, a Wyoming limited liability
company.
"Effective Date" shall mean July 1, 2023.
"Direct Payment Permit" also referred to herein as a "Texas Direct Payment Permit" shall
mean that permit issued by the State of Texas authorizing Company to self -assess and pay
applicable state and local use taxes directly to the State of Texas related to selected portions
of Company's taxable purchases. Texas Rule 3.288 of the Texas Administrative Code
defines the requirements and responsibilities of Texas Direct Payment Permit holders along
with any amendments, permutations, or recodifications of such Code or Rules whether
renaming such permits or otherwise modifying such provisions.
"Event of Bankruptcy or Insolvency" shall mean the dissolution or termination (other than
a dissolution or termination by reason of a party merging with an affiliate) of a parry's
existence as a going business, insolvency, appointment of receiver for any part of a parry's
property and such appointment is not terminated within ninety (90) business days after
such appointment is initially made, any general assignment for the benefit of creditors, or
the commencement of any proceeding under any bankruptcy or insolvency laws by or
against a party and in the event such proceeding is not voluntarily commenced by the party,
such proceeding is not dismissed within ninety (90) business days after the filing thereof.
"Force Maieure" shall mean any delays due to strikes, riots, acts of God, shortages of labor
or materials, war, terrorism, governmental approvals, laws, regulations, or restrictions, or
any other cause of any kind whatsoever which is beyond the reasonable control of the party.
"Pry" shall mean the economic incentive program established by the City pursuant to
Chapter 380 of the Texas Local Government Code together with any amendments,
permutations, or recodifications of such Code provisions whether renaming such economic
incentive or other modifications thereof.
"Program Grant" shall mean the periodic payments paid by the City to the Company in
accordance with Section 3 of this Agreement.
"Grant Period" shall mean consecutive six (6) month periods during the term of this
Agreement, except that the first Grant Period shall begin on the Effective Date and continue
through and include the last day of the month of the sixth (61h) month following the
CHAPTER 380 GRANT AGREEMENT BY AND BETWEEN
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Effective Date. For illustration purposes, assume the Effective Date is July 1, 2023 then
the first Grant Period would begin on July 1, 2023 and continue through and include
December 31, 2023. The next Grant Period would begin on January 1, 2024 and continue
through and include June 31, 2024. The final Grant Period for the initial 20-year term of
this Agreement would be from January 1, 2043 and end on June 30, 2043.
"Taxable Items" shall have the same meaning assigned by Sections 15 1.0 10 and 151.0101,
TEx. Tax CoDE, as amended, and shall include materials used for homebuilding and for
constructing Authorized Improvements (as defined in Chapter 372, Texas Local
Government Code) and similar type facilities.
"Impositions" shall mean all use taxes that may be imposed by public or governmental
authority on the Company or any taxable items purchased and used by Company within
the City.
"Use Tax Receipts" shall mean the Grantor's net receipts from the State of Texas from the
collection of one and one -quarter percent (1.25%) general City use tax imposed by the City
pursuant to Chapter 321 of the Texas Tax Code, attributed to the collection of use tax by
Company associated with the issuance of Company's Texas Direct Payment for Taxable
Items used or consumed in the City.
"Use Tax Certificate" shall mean a certificate or other statement in a form reasonably
acceptable to the Grantor setting forth the Company's collection of use tax imposed by and
received by the Grantor from the State of Texas, for the use of Taxable Items by Company
in the City for the applicable calendar month during a Grant Period which are to be used to
determine Company's eligibility for a Grant, together with such supporting documentation
required herein, and as Grantor may reasonably request.
ARTICLE II
TERM
2.01 Term. The term of this Agreement shall begin on the Effective Date and continue
for a twenty (20) year period.
2.02 This Agreement shall remain in effect until Grantor has made the Program Grants
set forth in Section 3 of the Agreement, or until otherwise terminated under the provisions of this
Agreement.
2.03 This Agreement may be extended for an additional period of time on terms mutually
acceptable to both parties by a written agreement executed by both parties.
ARTICLE III
ECONOMIC DEVELOPMENT GRANT
3.01 Grant. Subject to the Company's continued compliance of all the terms and
conditions of this Agreement, the Grantor agrees to provide Company with an economic
CHAPTER 380 GRANT AopmatENT BY AND BETR'EEN
THE CITY of ANNA AND ANACAPRI LACUNA AZURE, LLC. - PAGE 3
017871.000009W856-1770-3 786.v 1
development grant from lawful available funds payable as provided herein in an amount equal to
35% of the Use Tax Receipts, as previously defined herein (the "Grant"). The Grant will be paid
semi-annually at the end of each Grant Period. The Grant will never include any monies the
Company pays or owes to the State of Texas for any penalties for late payments, failures to report
in a timely manner, and the like, related to the Use Tax Receipts.
3.02 Grant Payment. Grantor shall pay the Grant for the applicable Grant Period within
forty-five (45) days after receipt of a Use Tax Certificate from Company following the end of each
Grant Period, pursuant to Section 4.01. Company shall submit Use Tax Certificates to Grantor
within thirty (30) days following the end of the applicable Grant Period, beginning with the first
Grant Period. For illustration purposes, assume the first Grant Period begins on July 1, 2023 and
continues through and includes December 31, 2023. Company would submit a Use Tax Certificate
to Grantor for the first Grant Period by January 30, 2024 and Grantor would pay the first Grant
within forty-five (45) days after receipt of the Use Tax Certificate and after actual receipt of all of
the net Use Tax Receipts attributable to the Grant Period. Further assume that the Use Tax Receipts
for the first Grant Period equal Five Thousand Dollars ($5,000.00), then the amount of the first
Grant would be One Thousand Seven Hundred Fifty Dollars ($1,750.00).
3.03 Amended Returns and Audits. In the event the Company files an amended use tax
return, or report, or if additional use tax is due and owing, as a result of an audit conducted by the
State of Texas that increases the Use Tax Receipts for a previous period covered within the term
of this agreement, the Grant payment for the Grant Period immediately following such State
approved amendment shall be adjusted accordingly, provided the Grantor must have received the
Use Tax Receipts attributed to such adjustment. As a condition precedent to payment of such
adjustment, Company shall provide Grantor with a copy of such amended use tax report, tax return
or audit adjustment, and the approval thereof by the State of Texas.
3.04 Refunds. In the event the State of Texas determines that the City erroneously
received Use Tax Receipts, or that the amount of use tax paid to the City exceeds the correct
amount of use tax for a previous Grant paid to the Company, the Company shall, within thirty (30)
days after receipt of notification thereof from the City specifying the amount by which such Grant
exceeded the amount to which the Company was entitled pursuant to such State of Texas
determination, pay such amount to the Grantor. The Grantor may at its option adjust the Grant
payment for the Grant Period immediately following such State of Texas determination to deduct
therefrom the amount of the overpayment. As a condition precedent to payment of such refund,
the City shall provide Company with a copy of such determination by the State of Texas.
ARTICLE IV
DOCUMENTATION SUPPORTING THE ECONOMIC DEVELOPMENT GRANT
The conditions contained in this Article IV are conditions precedent to the Grantor's
obligation to make any Grant payment.
4.01 Use Tax Certificate. During the term of this Agreement, the Company shall within
thirty (30) days after the end of each Grant Period, provide the Grantor with a Use Tax Certificate
relating to Use Tax Receipts paid during the Grant Period. The Grantor shall have no duty to
CHAPTER 3 80 GRANT AGPEEmENT BY Arm BETwEEN
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017871.000009\4856-1770-3786.v1
calculate the Use Tax Receipts or determine Company's entitlement to any Grant for a Grant
Period, or pay any Grant during the term of this Agreement until such time as Company has
provided the Grantor a Use Tax Certificate for such Grant Period and the Grantor has received the
actual Use Tax Receipts from the State of Texas attributable to such calendar months within the
Grant Period. Company shall provide such additional documentation as may be reasonably
requested by Grantor to evidence, support and establish the use tax paid directly to the State of
Texas pursuant to Company's Direct Payment Permit. The Use Tax Certificate for each Grant
Period shall at a minimum contain, include or be accompanied by the following:
a. A copy of all Texas Direct Payment Permit and self -assessment use tax returns and
reports during the applicable Grant Period, use tax audit assessments or credits,
including amended use tax returns or reports, filed by the Company during the
Grant Period showing use tax paid directly to the State of Texas related to
Company's operations for the Grant Period; and
b. Information concerning any refund or credit received by the Company of use tax
paid by the Company which has previously been reported by the Company as use
tax paid for a previous Grant Period within the term of this agreement.
Company will provide to Grantor the Use Tax Certificates from time to time pursuant to
the terms of the Agreement, which are confidential ("Confidential Information") and, except as
otherwise provided herein, may not be disclosed to a third party without the Company's consent.
To the extent that any disclosure of the Confidential Information may be required by law, Grantor
will use reasonable efforts to inform Company of the request in sufficient time for Company to
assert any objection it may have to such disclosure to an appropriate judicial or administrative
body.
4.02 Grantor must have received a Use Tax Certificate for the months within the Grant
Period for which payment of a Grant is requested, and Grantor must have received the actual Use
Tax Receipts for all calendar months within the Grant Period.
4.03 The Company intends to issue its Texas Direct Payment Permit to specific suppliers
or vendors that provide large quantities of building materials or other tangible personal property.
4.04 The Company shall provide the Grantor with a true and correct copy of its Texas
Direct Payment Permit, which permit shall be kept in full force and effect throughout the term of
the Agreement.
4.05 Company or the City shall not have an uncured material breach or default of this
Agreement.
ARTICLE V
TERMINATION
5.01 This Agreement may be terminated upon any one of the following:
CHAPTm 380 GRANT AGRE Rv ENT BY Am BET,%gmN
THE CITY of ANNA AND ANACAPRI LAGUNA AZURE, LLC. - PAGE 5
017871.000009148 56-1770-3 786.v 1
(a) by mutual written agreement of the parties;
(b) by Grantor or Company, respectively, if the other party defaults or breaches
any of the terms or conditions of this Agreement in any material respect and
such default or breach is not cured within thirty (30) days after written
notice thereof by the Grantor or Company, as the case may be;
(c) by Grantor, if any Impositions owed to the Grantor or the State of Texas by
Company shall have become delinquent (provided, however, Company
retains the right to timely and properly protest and contest any such
Impositions);
(d) by Grantor, if Company suffers an Event of Bankruptcy or Insolvency;
(e) by Grantor or Company, respectively, 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; or
(f) by Company, if the City does not pay the applicable Grant amount within
45 days of receipt of the Use Tax Receipts as required herein covered by a
valid Use Tax Certificate issued by Company or fails to cure this breach
within an additional 30 days and so long as the Company is not in default,
or;
(g) expiration of the term, or any subsequent renewal of the term.
The rights, responsibilities and liabilities of the parties under this Agreement shall be extinguished
upon the termination of this Agreement except for any rights, responsibilities and/or liabilities that
accrued prior to such termination.
ARTICLE VI
MISCELLANEOUS
6.01 Binding Agreement. The terms and conditions of this Agreement are binding upon
the parties to this agreement and their respective successors and permitted assigns. This
Agreement may not be assigned without the express written consent of Grantor, which consent
shall not be unreasonably withheld or delayed.
6.02 Limitation on Liability. It is understood and agreed between the parties that the
Company and Grantor, in satisfying the conditions of this Agreement, have acted independently,
and Grantor assumes no responsibilities or liabilities to third parties in connection with these
actions. The Company agrees to indemnify and hold harmless the Grantor from all such claims,
suits, and causes of actions, liabilities and expenses, including reasonable attorney's fees, of any
nature whatsoever by a third party arising out of the Company's performance of the conditions
under this Agreement.
CHAPTER 380 GRANT AGREEMENT BY AND BETwEEN
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6.03 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 a partnership or joint venture between the
parties.
6.04 Authorization. Each party represents that it has full capacity and authority to grant
all rights and assume all obligations that are granted and assumed under this Agreement.
6.05 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 such other address as
such party may subsequently designate in writing) or on the day actually received if sent by courier
or otherwise hand delivered sent via fax.
If intended for City, to:
Attn: Ryan Henderson
Interim City Manager
City of Anna
120 W. 7d' Street
Anna, TX 75409
With a copy to:
Attn: Clark McCoy
Wolfe, Tidwell & McCoy, LLP
2591 Dallas Parkway, Suite 300
Frisco, Texas 75034
If intended for the Company:
Attn: Zach Ipour
Anacapri Laguna Azure, LLC
2101 Cedar Springs Road, Suite 700
Dallas, Texas 75201
With a copy to:
Attn: Timothy G. Green
Coats Rose, P.C.
16000 N. Dallas Parkway, Suite 350
Dallas, Texas 75248
6.06 Entire Agreement. This Agreement is the entire Agreement between the parties
with respect to the subject matter covered in this Agreement except for that certain Anacapri
Development Agreement recorded in the Collin County property records as Document No.
CHAPTER 380 GRANT AGREEMENT BY AND BETWEEN
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20211021002155180. There are no other collateral oral or written agreements between the parties
that in any manner relate to the subject matter of this Agreement.
6.07 Governing Law. The laws of the State of Texas shall govern the Agreement; and
this Agreement is fully performable in Collin County, Texas with exclusive venue for any action
concerning this Agreement being in a court of competent jurisdiction in Collin County, Texas.
6.08 Amendment. This Agreement may only be amended by the mutual written
agreement of the parties.
6.09 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 shall 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.
6.10 Recitals. The recitals to this Agreement are incorporated herein.
6.11 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 and any such counterparts shall be deemed to be incorporated herein.
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.
6.13 Sovereign Immunity. The parties agree that the City has not waived its sovereign
immunity by entering into and performing its obligations under this Agreement.
6.14 Dispute Resolution. Any controversy or claim arising from or relating to this
Agreement, or a breach thereof shall be subject to non -binding mediation, as a condition precedent
to the institution of legal or equitable proceedings by any party unless the institution of such legal
or equitable proceeding is necessary to avoid the running of an applicable statute of limitation.
The parties shall endeavor to resolve their claims by mediation. Grantor and Company shall share
the costs of mediation equally. The mediation shall be held in Collin County, Texas, unless another
location is mutually agreed upon. Agreements reached in mediation shall be enforceable as
settlement agreements in any court having jurisdiction thereof.
[SIGNATURE PAGES FOLLOW)
CHAPTER 380 GRANT AGREEMENT BY AND BETWEEN
THE CITY of ANNA AND ANACAPRI LAGuNA AZURE, LLC. - PAGE 8
017871.00000914856-1770-3786.vl
EXECUTED as of the Jday of 2023.
THE CITY OF ANNA, TEXAS
m
Interim City Manager
ATTEST:
CJ24.4.c.L� . x4aIl
Carrie Land, City Secretary
CHAPTER 380 GRANT AGREEMENT BY Am BETUVEEN
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017871.000009`4856-1770-3786.v1
EXECUTED as of the day of , 2023.
ANACAPRI LAGUNA AZURE, LLC,
a Wyoming limited liability company
By: AI Revocable Trust, its member
Armin Afzalipour, Trustee of the AI Revocable Trust
STATE OF TEXAS §
COUNTY OF §
This instrument was acknowledged before me, on the day of , 2023, by
Armin Afzalipour, Trustee of the AI Revocable Trust in its capacity as member of AnaCapri
Laguna Azure, LLC, a Wyoming limited liability company, on behalf of said company, who, upon
his sworn oath, declared that he is authorized to bind said company.
Notary Public in and for the State of Texas
[SEAL]
CHAPTER 3 80 GRANT AGREEMENT BY AND BETWEEN
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