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2014-006 - Approving an Economic Incentive Agreement between the Paris Economic Development Corporation and Campbell Soup Supply Company, LLCRESOLUTION NO. 2014 -006 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS, APPROVING AN ECONOMIC INCENTIVE AGREEMENT BETWEEN THE PARIS ECONOMIC DEVELOPMENT CORPORATION AND CAMPBELL SOUP SUPPLY COMPANY, LLC; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE. WHEREAS, on August 14, 2012, the Paris Economic Development Corporation entered into an Economic Incentive Agreement with Campbell Soup Supply Company, LLC related to Campbell Soup's $25,000,000.00 investment in a new Single Serve Juice ( "SS Juice ") line at the Paris, Texas Plant; and, WHEREAS, pursuant to City and PEDC policy, the City Council shall review all economic incentive agreements involving an expenditure in excess of $400,000.00; and WHEREAS, the City Council hereby finds that it is in the best interest of the City to approve the PEDC Economic Incentive Agreement with Campbell Soup for the new Single Serve Juice ( "SS Juice ") line at the Paris, Texas plant. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS: Section 1. That the findings set out in the preamble of this resolution are hereby in all things approved. Section 2. That the Economic Incentive Agreement dated August 14, 2012 between the Paris Economic Development Corporation and Campbell Soup Supply Company, LLC form, attached hereto as Exhibit "A ", is hereby ratified and approved. PASSED AND ADOPTED this 27th day of J TTEST: nice Ellis, City Clerk APPROVED AS TO FORM: W. Ken c ar, City Attorney ECONOMIC INCENTIVE AGREEMENT STATE OF TEXAS ) KNOW ALL MEN BY THESE PRESENTS: COUNTY OF LAMAR ) THAT, the PARIS ECONOMIC DEVELOPMENT CORPORATION, a Non -Profit Texas Corporation, acting by and through its Board of Directors (hereinafter called "Paris EDC "), and CAMPBELL SOUP SUPPLY COMPANY LLC, a Delaware limited liability company (hereinafter called "Campbell Soup "), do hereby contract and agree with each other within this Agreement (herein so called) as follows: WITNESSETH: WHEREAS, the Paris EDC a local Economic Development Corporation organized under the Texas Development Corporation Act of 1979, codified as Chapters 501 and 504 of the Texas Local Government Code (hereinafter, the "Act "), exists for the purpose of encouraging and assisting qualified service and manufacturing entities in the creation and retention of facilities and jobs in the Paris, Texas, area; and WHEREAS, Campbell Soup is a manufacturer and marketer of high quality food and beverage products, with one of its primary manufacturing plants located in Paris, Texas at 500 Loop 286, Paris, Texas 75460 (the "Property," "Plant," or "Facility "); and WHEREAS, Campbell Soup manufactures a line of "Single Serve Juice" ( "SS Juice ") products, some of which will be manufactured at the Campbell Soup Facility in Paris, Texas and in connection therewith, Campbell Soup has committed to make a new capital investment of approximately $25,000,000.00 in the Paris, Texas Plant ( "Capital Investment "); and WHEREAS, the Capital Investment will include: (1) construction of a new SS Juice production and packaging line at the Paris, Texas Plant; (2) acquisition and installation of new machinery and equipment for the line; (3) creating 50 new jobs at the Paris Facility to operate and maintain the SS Juice line; and (4) job training for the employees hired to operate and maintain the SS Juice line; and WHEREAS, Campbell Soup created 50 new jobs for the SS Juice line, and commits to retain a minimum of 500 full -time equivalent employees at the Paris, Texas Plant throughout the term of this Economic Incentive Agreement; and WHEREAS, in consideration of the Capital Investment that Campbell Soup is making in the Paris, Texas Plant, the new jobs created for the SS Juice line and retention of at least 500 jobs at the Paris Facility, Paris EDC has agreed to provide certain financial incentives to Campbell Soup as set forth in this Agreement; and WHEREAS, the Paris EDC Board, at a regularly scheduled meeting on August 14, 2012, approved an economic incentive offer of FIVE HUNDRED THOUSAND DOLLARS ($500,000.00) to Campbell Soup for the new Capital Investment in the SS Juice Line, 50 new full -time jobs for the SS Juice line, retention of at least 500 jobs at the Paris, Texas Plant and specialized job training for the new SS Juice line, and directed PEDC staff to finalize the scope and terms of the economic incentive package in an Economic Incentive Agreement; and WHEREAS, the $500,000.00 economic incentive payment will be paid to Campbell Soup in one lump sum within five (5) days following execution of this Agreement by all parties and approval of the Agreement by the PEDC Board and the Paris City Council; and WHEREAS, the Board of Directors of Paris EDC has determined that it is in the best interest of the City of Paris, Texas community and the local economy that Paris EDC provide these economic incentives to Campbell Soup to help bring the new capital investment to the Paris, Texas Facility through the new SS Juice line and fifty (50) new jobs and to maintain 500 jobs at the Campbell Soup Facility in Paris, Texas; and NOW, THEREFORE, in consideration of the covenants, promises, and conditions set forth herein, the Paris EDC and Campbell Soup agree as follows: I. TERM This Agreement shall be effective upon the date last executed by the Parties hereto and shall remain in force for a term of five (5) years from the effective date. II. REPRESENTATIONS AND OBLIGATIONS OF THE PARTIES A. Campbell Soup's Duties, Obligations and Representations: 1. Campbell Soup shall make a Capital Investment of at least $25,000,000.00 in the Paris, Texas Plant as part of the new SS Juice line by December 31, 2013. 2. Campbell Soup shall hire fifty (50) new full -time employees at the Paris, Texas Plant as part of the new SS Juice line by December 31, 2013. 3. Campbell Soup shall retain a minimum of five - hundred (500) full -time jobs at the Paris, Texas Plant throughout the term of this Agreement. 4. Campbell Soup shall provide High Performance Organization ( "HPO ") training to all new employees working on the SS Juice line. 5. Campbell Soup shall provide all training to start-up, operate and successfully maintain the SS Juice line, including any necessary cross - training or HPO training for retained full -time employees at the Paris, Texas Plant. 6. Campbell Soup shall continue to operate a food and beverage manufacturing plant with a diversified product line at the Paris, Texas Facility throughout the term of this Agreement. 7. Campbell Soup shall provide all documentation required by Paris EDC to verify that the $25,000,000.00 new Capital Investment was made in the Paris, Texas Facility and that 50 new full -time equivalent (FTE) jobs were filled at the Paris, Texas Facility by December 31, 2013. 8. Campbell Soup shall provide annual compliance statements to Paris EDC, in a form acceptable to Paris EDC, that verify that Campbell Soup is full compliance with all terms and conditions of this Agreement. B. Campbell Soup Represents to Paris EDC the following: 1. Campbell Soup has filed all necessary plats, site plans and building permit applications with the City of Paris, Texas ( "City ") to construct and complete the Capital Investment (SS Juice line); it has pulled all necessary building permits, and complied with all City ordinances, building and development codes in making the improvements to its Property in Paris, Texas. 2. Campbell Soup shall provide annual compliance statements to Paris EDC by January 31" of each year that verify that all FTE jobs referenced herein are still in place and filled at the Paris, Texas Facility. Campbell Soup agrees to provide any other personnel records, payroll records, documents, reports or affidavits deemed necessary by Paris EDC to verify minimum employment /retention requirements at the Paris facilities. Campbell Soup shall provide these additional verification documents to Paris EDC within fifteen (15) days following request from Paris EDC. 3. For purposes of this Agreement, a full -time equivalent job ( "FTE ") shall mean employment by Campbell Soup at the Property for a person eligible to receive employee benefits. 4. Campbell Soup will pay all taxes when due, including, but not limited to: federal employment, payroll and Medicare taxes on its employees; all state and local sales and use taxes and excise and franchise taxes; and all ad valorem taxes on all real and personal property. In the event Campbell Soup should fail to pay any of the lawfully imposed taxes or fees referred to above when due, plus any penalties, interest, costs or attorney's fees lawfully imposed, Campbell Soup shall be considered in default of this Agreement and Paris EDC may terminate this Agreement and pursue recovery of any and all economic incentives provided to Campbell Soup under this Agreement plus any other rights it may have in equity or under the law. 5. Campbell Soup agrees not to employ undocumented workers at its Paris, Texas Facility. Should Campbell Soup be convicted of a violation under 8 U.S.C. Section 1324a(f) regarding the employment of undocumented workers during the term of this Agreement, it shall be deemed in default and subject to termination of Agreement and reimbursement of Economic Incentive funds as provided herein. 6. Campbell Soup agrees to operate and maintain its Paris Texas Facility as described herein for the five (5) year term of this Agreement. If Campbell Soup fails to maintain its Paris Facilities as set forth in this Agreement, then Campbell Soup shall be considered in default of this Agreement. If Campbell Soup is unable to cure this default within thirty (30) days following receipt of written notice of default from Paris EDC, then Campbell Soup shall reimburse and repay Paris EDC all funds paid to Campbell Soup under this Agreement within sixty (60) days. 7. Throughout the term of this Agreement and any extensions thereof, Campbell Soup agrees, upon request, to provide copies of its audited or unaudited annual financial statements to Paris EDC within thirty (30) days of the end of Campbell Soup's fiscal year. Upon request from Paris EDC and three business days advance notice, Campbell Soup shall make its financial records and books open for inspection and review by Paris EDC or Paris EDC's authorized accountants or agents. C. Paris Economic Development Corporation's Duties, Obligations and Representations: 1. Paris EDC agrees to pay the above - described incentive payment of $500,000.00 to Campbell Soup within five (5) business days of final approval and execution of the Agreement by all parties hereto. 2. Paris EDC has completed its assistance to Campbell Soup in advocating tax abatement agreement for the Paris, Texas Facility with the City of Paris, Texas, with Lamar County, Texas and with the Paris Junior College for the SS Juice line was approved by the Paris City Council on August 27, 2012. The tax abatement agreement was authorized in conformity with the approved Tax Abatement Guidelines and Criteria of the above named taxing jurisdictions. 3. Convene and facilitate additional State and Federal incentives for which Campbell Soup's project may qualify, including, but not limited to Skill Training funds through the Texas Workforce Commission; Texas Enterprise Fund award from the Texas Governor's Office; Financial Assistance through the Texas Economic Development Bank, Enterprise Zone Designation, and Federal New Market Tax Credits. III. EVENTS OF DEFAULT AND REMEDIES A. Events of Default - Campbell Soup shall be in default of this Agreement if it shall: 1. Fail to make the $25,000,000.00 Capital Investment in the Paris, Texas Facility for the SS Juice line, as provided in this Agreement; 2. Fail to employ 50 new employees at the Paris, Texas Facility as part of the new SS Juice line as provided for in this Agreement; 3. Fail to retain a minimum workforce of 50Q employees at the Paris, Texas Facility throughout the term of this Agreement or any extensions thereof; 4. Fail to maintain and operate its Facility at the Property in Paris, Texas throughout the term of this Agreement or any extensions thereof; 5. Fail to comply with all terms and conditions of this Agreement; or 6. Make any false representations or warranties to Paris EDC to induce this economic incentive agreement. B. Remedies - Upon the occurrence of any of the above Events of Default which shall remain uncured for thirty (30) days after written notice from Paris EDC to Campbell Soup describing the default, Paris EDC shall have the right to: 1. Suspend and refuse to pay to Campbell Soup any unfunded portions of the Economic Incentives referenced in this Agreement. 2. Sue for reimbursement and /or repayment of all Economic Incentive payments paid by Paris EDC to Campbell Soup pursuant to this Agreement, plus interest, costs and attorney's fees. 3. Suspend as of the tax year in which the Event of Default occurs, all tax abatements granted to Campbell Soup which are still in force and effect, so that Campbell Soup will be required to pay ad valorem taxes at the market value of the improvements with respect to which taxes have been abated for the year in which the Event of Default occurs and all future years. C. Dispute Mediation: Notwithstanding the foregoing provisions to the contrary, the parties hereto agree to mediate any disputes they have against one another before filing a lawsuit. The parties will attempt to agree on a professional attorney /mediator based in or willing to conduct the mediation in Paris, Texas, but if this is not possible, the parties will engage an attorney /mediator from another city located within one hundred thirty (130) miles from the City of Paris, Texas. Each party agrees to mediate in good faith to attempt to resolve any dispute hereunder, to pay an undivided one -half of the mediation costs, and each party's own attorneys fees; and to bring an authorized representative of the party to the mediation having settlement authority; provided, however, that any settlement which requires payment to be made by Paris EDC is subject to formal approval of the payment at the next available meeting of the Board of Directors of Paris EDC. IV. ADDITIONAL REPRESENTATIONS AND WARRANTIES: Campbell Soup hereby represents and warrants to Paris EDC that the following representations are true and correct as of the date of execution hereof and will continue to be true and correct throughout the term of this Agreement: A. Campbell Soup is duly organized, validly existing and in good standing under the laws of the State of Delaware, and is duly qualified to do business in the State of Texas, as a foreign limited liability company, and has all corporate power and authority to carry on its business as presently conducted in Texas. B. Campbell Soup warrants and represents that it has the authority to enter into and to perform this Agreement, and that the person signing this Agreement on behalf of Campbell Soup is duly authorized to do so by the members of Campbell Soup Supply Company, LLC and by any authority needed by its parent corporation or by other corporate authority under which it is organized; and Campbell Soup shall deliver to Paris EDC on the effective date of this Agreement, a certificate of its lawfully provided for resolutions authorizing the execution, delivery and performance of this Agreement, together with an incumbency certificate identifying its executive officers and the officers signing the documents. C. Campbell Soup has received at this time all necessary rights, licenses, leases, permits and other evidences of authority to conduct and carry on its business in the State of Texas in accordance with the representations it has made to Paris EDC herein. D. Campbell Soup is aware of the statutory limitations upon Paris EDC in entering into this Incentive Agreement with it, and is also aware of the use required by law to be made by Campbell Soup of the funds paid hereunder by Paris EDC pursuant to the provisions of the Texas Economic Development Corporation Act, Chapters 501 and 504 of the TEX. LOC. GOVT CODE. Campbell Soup further acknowledges and agrees that the funds provided to them hereunder as an economic incentive for creating new jobs and investing its capital in the City of Paris, Lamar County, Texas shall be utilized solely for the purposes authorized under the Texas Statute just cited and the terms of this Agreement. If an audit should ever determine that the funds were not utilized by Campbell Soup for these purposes, such determination shall constitute a default under this Agreement, thereby entitling Paris EDC to exercise all of its remedies under this Agreement and provided to Paris EDC by law. In this regard, Campbell Soup shall provide to Paris EDC within thirty (30) days after request from Paris EDC, their annual financial statements that Paris EDC shall require to confirm the uses of funds by Campbell Soup and to verify the terms and provisions of this Agreement. E. Campbell Soup represents that it is not involved in any bankruptcy proceedings at this time, and that it has not filed a petition in bankruptcy, nor are any such proceedings contemplated by them at this time. If Campbell Soup shall become the subject of voluntary or involuntary bankruptcy proceedings during the term of this agreement, the same shall constitute an event of default under this Agreement and under any tax abatement agreements then in force and effect. In such event, no further incentive funds to be advanced (if any), by Paris EDC under this Agreement shall be advanced, and any obligations of Campbell Soup to repay incentive funds already advanced to it by Paris EDC under the provisions herein shall be paid to Paris EDC within thirty (30) days after demand from Paris EDC. V. GENERAL PROVISIONS A. This Agreement sets forth the entire understanding between the parties, and any other understandings or agreements pertaining to the subject matters of this Agreement shall be superseded by this Agreement upon the date of execution hereof. None of the terms of this Agreement shall be waived, discharged, altered or modified in any respect, except by an agreement in writing signed by both parties and specifically referring to this Agreement. This Agreement is performable in Lamar County, Texas, and shall be governed by, construed and enforced in accordance with the laws of the State of Texas. The provisions of this Agreement shall apply to, bind and inure to the benefit of Paris EDC and Campbell Soup and their respective successors, and permitted assigns, if any. B. The terms and conditions of this Agreement are binding upon the successors and assigns of all parties hereto. Neither this Agreement, nor any interest therein, shall be assigned by Campbell Soup without the prior written consent of Paris EDC Board. C. Venue for any actions arising under this Agreement shall lie exclusively in the courts of Lamar County, Texas, for any state court action, and in the U.S. District Court for the Eastern District of Texas for any Federal Court action. D. All representations, warranties, covenants and agreements of the parties, as well as any rights and benefits of the parties, pertaining to the transaction contemplated hereby shall survive the original execution date of this Agreement. E. Any notices required to be given hereunder shall be in writing and shall be deemed to be duly delivered by mailing the same postage prepaid, by certified mail, return receipt requested (or by overnight delivery service), to the parties at the addresses shown beneath their signatures to this Agreement. Addresses may be changed by a party only by giving written notice of such change to all other parties in accordance with this paragraph at least five (5) days in advance of delivering the notice by mail, and at least one (1) day in advance of delivering the notice by fax or e -mail. EXECUTED on the day of 2013 (herein called the "Effective Date" of this Agreement). PARIS ECONOMIC DEVELOPMENT CORPORATION By: ATTEST: Paris EDC Secretary - Treasurer Rebecca Clifford, Paris EDC Board Chairman 1125 Bonham St., Paris, TX 75460 (903) 784 -6964 parisedc@paristexasusa.com CAMPBELL SOUP SUPPLY COMPANY, LLC ( "Campbell Soup ") By: Name, Title: David B. Biegger, Chairman Address: 1 Campbell Place, Box 43 Camden, NJ 08103 -1799 Attn: Legal Department Phone: 856- 342 -4800 ATTEST: Name, Title: ACKNOWLEDGMENTS STATE OF TEXAS ) COUNTY OF LAMAR ) BEFORE ME, the undersigned authority, on this day personally appeared , Chairman of the Paris Economic Development Corporation, Paris, Texas, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE, this day of , 2013. Notary Public, State of Texas STATE OF NEW JERSEY) COUNTY OF CAMDEN ) BEFORE ME, the undersigned authority, on this day personally appeared, of Campbell Soup Supply Company, LLC, a Delaware limited liability company, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, as the act of said company and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE, this day of , 2013. Notary Public, State of New Jerse