	Sugar Land Development Corporation
	Agenda Request
Agenda Of:	11/06/2007	Agenda Request No:		II B
Initiated By:	regina morales	Responsible Department:		economic development
Presented By:	regina morales	Department Head:		regina morales, director of economic development
		Additional Department. Head (s):		n/a
Subject / Proceeding:	consideration of amendment 1 to performance agreement between the sugar land development corporation and industrial information resources, inc.
Exhibits:	amendment 1 to performance agreement between the sugar land development coporation and industrial information resources, Inc.
Clearances			Approval
Legal:	eugenia cano, assistant city attorney		Executive Director:	joe esch, executive director, business & intergovernmental rel.
Recommended Action
Approve Amendment 1 to Performance Agreement between the Sugar Land Development Corporation and Industrial Information Resources. Inc.
Executive Summary
Currently, IIR is in default due to their obligation to host an annual event at the Marriott Conference Center and the fact that the agreement does not provide a cure provision. To date, IIR has outperformed their projections and continues to expand beyond the minimums set forth in their agreement in job creation and lease space held. IIR has submitted a request to amend the agreement to provide a cure provision for the annual event and expand location options within Sugar Land. In consideration of the amendment, the agreement will specify the services that IIR will provide to the City in software databases for project information, marketing and PR services. Staff recommended that the agreement with SLDC be amended to address the following deal points: · Specify actual services received and apply monetary value of $400,000 ( $40,000 per year for life of agreement) · Specify direct incentive of $450,000 with initial payment of $100,000 and subsequent payments of $35,000 per year. · Revise the section of “Use of Conference Center” to expand the annual event obligation to other venues within Sugar Land · Create cure provision similar to other payback options in agreement based on a guaranteed value to City of $5000 annually in sales tax or hotel tax revenues. The Business Incentive Committee concurred with the staff recommendation to amend the performance agreement. The following Performance Agreement addresses the deal points and revisions recommended.
Exhibits

AMENDMENT NO. 1 TO PERFORMANCE AGREEMENT BETWEEN

THE SUGAR LAND DEVELOPMENT CORPORATION AND

INDUSTRIAL INFORMATION RESOURCES, INC.

Background

On June 27, 2005 the Sugar Land Development Corporation (SLDC) executed a Performance Agreement with Industrial Information Resources, Inc. (Industrial) providing for economic incentive payments by the SLDC to Industrial in consideration of Industrial performing the obligations imposed by the Performance Agreement. The SLDC and Industrial desire to amend the Performance Agreement to require that Industrial provide additional services to the City in exchange for certain modifications to the Performance Agreement.

Agreement

The Sugar Land Development Corporation and Industrial Information Resources, Inc. agree as follows:

1. Section 1 of the Agreement is amended by adding a definition for Sales Tax and amending the definition for Year of the Agreement as follows:

Sales Tax means the City’s 2% sales and use tax consisting of (i) the municipal sales and use tax and the additional municipal sales tax adopted by the City under the authority of the Texas Tax Code, Chapter 321, and (ii) the city sales and use tax imposed by the City for industrial and economic development under the authority of the Development Corporation Act of 1979 (Texas Civil Statutes, Article 5190).

Year or Year of this Agreement means, unless the context clearly indicates otherwise, from June 1 through May 31^st.

2. Section 3(b) of the Agreement is amended to read as follows:

(b) Hosting an Event. Each Year of this Agreement, Industrial will host one or more functions within the City that generates a minimum of $5,000.00 in combined City hotel occupancy taxes and Sales Taxes. On or before May 1 of each Year Industrial must provide:

(1) copies of hotel invoices from attendees of the event(s) that correspond to the event date(s); and

(2) Industrial’s Sales Tax receipts for events held at an establishment that collects the Sales Tax.

If for any Year of this Agreement Industrial fails to meet the requirements of this paragraph, the failure will not be a default of this Agreement, but the SLDC’s incentive payments to Industrial will be reduced in an amount equal to the difference between what the City received in hotel occupancy taxes and Sales Taxes required by this paragraph and what the City would have received had Industrial met the requirements of this paragraph.

3. Section 3 is amended by adding paragraphs 3(j), (3)(k) and 3(l) as follows:

(j) Name Recognition. Industrial will name the City of Sugar Land as the location of its corporate headquarters in all of its printed materials and publications distributed through the internet.

(k) Industry Software. Industrial will provide the City with a copy of and license to use its proprietary Geolocator software and send the City weekly software updates on industrial projects.

(l) Articles on Sugar Land Projects. Industrial will publish and distribute a minimum of four articles each year on Sugar Land projects.

Section 4 of the Agreement is amended to read as follows:

4. SLDC Economic Incentive Payments. The SLDC will make 11 economic incentive payments to Industrial. The first incentive payment of $100,000 will be made after June 1, 2006, and within 30 days following the date that Industrial provides to the City:

(1) A copy of a binding executed lease showing that Industrial has leased the Leased Premises from June 1, 2006, through February 28, 2017;

(2) A copy of a certificate of occupancy for the Leased Premises issued by the City; and

(3) A letter from Industrial certifying that Industrial is in compliance with the requirements of this Agreement.

The SLDC will make an incentive payment to Industrial in the amount of $75,000 within 30 days of Industrial providing the SLDC with evidence of full compliance with the obligations imposed upon Industrial under this Agreement. Thereafter, the SLDC will make an economic incentive payment to Industrial by June 1 of each Year of this Agreement in the amount of:

(1) $40,000 if Industrial has complied with the obligations in Section 3(j), (3)(k), and 3(l) and provides the City with information reasonably necessary for the City to determine compliance with those provisions; and

(2) $35,000 if Industrial has provided the SLDC with evidence of Industrial’s full compliance with all other obligations imposed upon Industrial under this Agreement to that date.

SUGAR LAND DEVELOPMENT INDUSTRIAL INFORMATION

CORPORATION RESOURCES, INC.

______________________________ By: ______________________________

Michael Schiff, President

Date: ________________________ Date: _____________________________

ATTEST:

_____________________________

Glenda Gundermann, City Secretary

Reviewed for Legal Compliance: