Ordinance 58-11RECORD OF ORDINANCES
Dayton Legal Blank, Inc.
Ordinance No.
AN ORDINANCE AUTHORIZING THE
PROVISION OF CERTAIN INCENTIVES TO
SOCIUS1, LLC TO INDUCE IT TO RETAIN AN
OFFICE AND ASSOCIATED OPERATIONS
AND WORKFORCE WITHIN THE CITY, AND
AUTHORIZING THE EXECUTION OF AN
ECONOMIC DEVELOPMENT AGREEMENT.
WHEREAS, consistent with its Economic Development Strategy (the "Strategy")
approved by Dublin City Council Resolution No. 07 -94 adopted on June 20, 1994, and
the updated Strategy approved by Dublin City Council Resolution No. 30 -04 adopted on
July 6, 2004, the City desires to encourage commercial office development and provide
for the retention and creation of employment opportunities within the City; and
WHEREAS, Sociusl, LLC (the "Compan)") recently performed a comprehensive
examination of its workforce needs, and based on the results of this examination, and
induced by and in reliance on the economic development incentives provided in the
proposed Economic Development Agreement (as described below), the Company is
desirous of leasing a facility within the City to retain an office and associated operations
and workforce within the City in order to achieve the payroll withholding targets set
forth in the Economic Development Agreement; and
WHEREAS, this Council has determined that it is necessary and appropriate and in the
best interests of the City to provide for certain economic development incentives to the
Company, as described in the proposed Economic Development Agreement; and
WHEREAS, this Council has determined to offer the economic development
incentives, the terms of which are set forth in a substantially final form of Economic
Development Agreement presently on file in the office of the Clerk of Council, to
induce the Company to lease a facility within the City and retain an office and
associated operations and workforce within the City, which will result in the creation of
new jobs and the retention of existing jobs, thereby improving the economic welfare of
the people of the State of Ohio and the City, all as authorized in Article VIII, Section 13
of the Ohio Constitution.
NOW, THEREFORE, BE IT ORDAINED by the Council of the City of Dublin, State
of Ohio, _ I of the elected members concurring, that:
Section 1 . The Economic Development Agreement by and between the City and the
Company, in the form presently on file with the Clerk of Council, providing for, among
other things, the provision of certain economic development incentives in consideration
for the Company's agreement to lease a facility within the City for the retention of an
office and associated operations and workforce within the City, which will result in the
creation of new jobs and the retention of existing jobs, is hereby approved and
authorized with changes therein not inconsistent with this Ordinance and not
substantially adverse to this City and which shall be approved by the City Manager.
The City Manager, for and in the name of this City, is hereby authorized to execute that
Economic Development Agreement, provided further that the approval of changes
thereto by that official, and their character as not being substantially adverse to the City,
shall be evidenced conclusively by the execution thereof. This Council further
authorizes the City Manager, for and in the name of the City, to execute any
amendments to the Economic Development Agreement, which amendments are not
inconsistent with this Ordinance and not substantially adverse to this City.
58-11
Passed 20_ I
Section 2 . This Council further hereby authorizes and directs the City Manager, the
Director of Law, the Director of Finance, the Clerk of Council, or other appropriate
RECORD OF ORDINANCES
58 -11 Page 2 of 2
Ordinance No. Passed 20
officers of the City to prepare and sign all agreements and instruments and to take any
other actions as may be appropriate to implement this Ordinance.
Section 3 . This Council finds and determines that all formal actions of this Council
and any of its committees concerning and relating to the passage of this Ordinance were
taken in open meetings of this Council or committees, and that all deliberations of this
Council and any of its committees that resulted in those formal actions were in meetings
open to the public, all in compliance with the law including Section 121.22 of the
Revised Code.
Section 4 . This Ordinance shall be in full force and effect on the earliest date
permitted by law.
Signed:
Mayor - P esid k Officer
Attest:
(2,y� a
Clerk of Council
Passed: / 2011
Effective: ezi L 2011
CITY OF DUBLIN-
Office of the City Manager
5200 Emerald Parkway • Dublin, OH 43017 -1090
Phone: 614 -410 -4400 • Fax: 614 - 410 -4490
To: Dublin City Council Members
From: Marsha I. Grigsby, City Manager X_C P
Date: October 20, 2011
Initiated By: Michael Clarey, Economic Development Administrator
Colleen Gilger, Economic Development Manager
Re: Ordinance 58 -11 -Economic Development Agreement with Sociusl, LLC
Summary
Staff has been in discussions with Sociusl, LLC (Socius) regarding the relocation and expansion of the
company's Dublin office and workforce. The company's expansion plans necessitate a move from their
current office space in the Dublin Entreprenurial Center. Socius has been a Dublin business since 2000.
Staff worked to retain Socius' operations in Dublin while the company explored real estate options in
other Central Ohio communities.
Socius provides a wide array of specialized software consulting services to clients who are installing and
upgrading business solution systems. The company specializes in implementation and continued
servicing of ERP (enterprise resource planning), CRM (customer relationship management), Business
Intelligence, and Collaboration software packages. Socius is a Microsoft Gold Certified Partner and
earned the distinction of achieving Microsoft Dynamics Inner Circle status for seventeen years. Socius
has major operations in Dublin, Cincinnati, Cleveland, San Jose CA, and Kansas City KS.
The Economic Development Agreement proposed by Economic Development to Socius includes a four -
year, 10 percent Performance Incentive on withholdings collected (2012 - 2015), which is capped at
S19,000 for the term of the agreement, in consideration of the company retaining 23 jobs, creating 13
jobs in Dublin by the end of 2016, and signing a lease through 2016. The company would have to reach
predetermined annual withholdings targets to qualify for performance incentives.
Additionally, the company is eligible to receive bonus performance years in 2016 and 2017 (capped at
S 11,000) for a minimum three -year lease extension to December 2019. That brings the overall incentive
package to a maximum cap value of $30,000.
The City estimates it would net approximately $268,000 in income tax withholdings over the
agreement's six -year term, should the company grow according to expectations and extend leases within
Dublin through December 2019.
Recommendation
Staff recommends Council passage of Ordinance 58 -11 at the second reading/public hearing on
November 14. Please contact Michael Clarey or Colleen Gilger with any questions you may have.
ECONOMIC DEVELOPMENT AGREEMENT
THIS ECONOMIC DEVELOPMENT AGREEMENT (the `Agreement") is made and entered into
this day of , 2011, by and between the CITY OF DUBLIN, OHIO (the "City"), a
municipal corporation duly organized and validly existing under the Constitution and the laws of
the State of Ohio (the "State ") and its Charter, and Sociusl, LLC, an Ohio limited liability
company (the "Company" and together with the City, the `Parries "), under the circumstances
summarized in the following recitals.
RECITALS:
WHEREAS, consistent with its Economic Development Strategy (the "Strategy") approved
by Dublin City Council Resolution No. 07 -94 adopted on June 20, 1994, and the updated Strategy
approved by Dublin City Council Resolution No. 30 -04 adopted on July 6, 2004, the City desires
to encourage commercial office development and provide for the retention and creation of
employment opportunities within the City; and
WHEREAS, based on the results of the Company's recent comprehensive examination of
workforce needs, and induced by and in reliance on the economic development incentives provided
in this Agreement, the Company desires to retain an office and associated operations and
workforce within the City; and
WHEREAS, pursuant to Ordinance No. -11 passed on , 2011 (the
"Ordinance "), the City has determined to offer the economic development incentives described
herein to induce the Company to lease a facility within the City for the retention of an office and
associated operations and workforce within the City, which will result in the creation of new jobs
and the retention of existing jobs to improve the economic welfare of the people of the State of
Ohio and the City, all as authorized in Article VIII, Section 13 of the Ohio Constitution; and
WHEREAS, the City and the Company have determined to enter into this Agreement to
provide these incentives in order to induce the Company to lease a facility within the City and
retain its operations and workforce within the City;
Now THEREFORE, the City and the Company covenant, agree and obligate themselves as
follows:
Section 1. Company's Agreement to Lease a Facility and Retain Its Operations an d
Workforce Within the City In consideration for the economic development incentives to be
provided by the City herein, the Company agrees that it will lease a facility within the City for the
retention of an office and associated operations and workforce within the City, all consistent with
the terms of this Agreement. The Company expects to create thirteen (13) new employee positions
within the City by December 31, 2016. The Company also expects to retain twenty -three (23)
existing employee positions within the City. The average annual wage of these employees is
estimated to be Eighty Thousand Dollars ($80.000), with total estimated payroll withholdings of
approximately Two Hundred Ninety Eight Thousand Dollars ($298.000) over the term of this
Agreement. The Company agrees that the City's obligations to remit payments pursuant to
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Section 2 of this Agreement shall be contingent upon (a) the Company delivering to the City a
fully executed copy of an agreement evidencing the Company's lease of a facility within the City
for a period of at least five (5) years and (b) such other conditions as set forth in Section 2.
Section 2. Citv Agreement to Provide Incentives
(a) General In consideration for the Company's agreement to lease afacility within the
City for the retention of an office and associated operations and workforce within the City, the City
agrees to provide economic development incentives to the Company in accordance with this
Section.
(b)
Workforce Creation Incentive
(i) Calculation of Actual Pavroll Withholding Taxes On or before March 15 of
each of the years 2013 through 2016, and in the years 2017 and 2018 if subsection 2(b)(iv)
is applicable, the City shall calculate the actual payroll withholding taxes collected and
received during the then preceding calendar year and in respect of that preceding calendar
year by the City from all Employees (as defined below). For purposes of that calculation,
the Company acknowledges and agrees that the total amount of actual payroll withholding
taxes in respect of any calendar year shall be determined based solely upon the amount of
payroll withholding tax payments actually received by the City from the Company during
that calendar year. The Company agrees that the determination of whether to include in
such calculation any amount received by the City in respect of any calendar year but
following the conclusion of that calendar year, shall be solely within the discretion of the
City. For purposes of this Section 2, `Employees" shall include only those individuals
employed by the Company and working within the City.
(ii) Information Relating to Employees The Company agrees that, in
accordance with the Dublin City Code, the annual payroll reconciliation and related W -2
forms relating to its Employees will be provided to the City prior to February 28 of each
calendar year.
(iii) Annual Incentive Payments to the Company If the actual payroll
withholding taxes collected and received by the City during the then preceding calendar year
and in respect of that preceding calendar year from all Employees, net of refunds (such
amount being referred to as the Actual Withholdings "), equal or exceed the Target
Withholdings (as defined in subsection 2(b)(v)) for that preceding calendar year, the City
shall, on or before April 15 of the then current calendar year, pay to the Company, solely
from nontax revenues (as defined in subsection 2(d)), an amount equal to the product of (A)
an amount equal to the Actual Withholdings multiplied by (B) ten percent (10 %) (with each
such product being referred to as an `Annual Incentive Payment' or if subsection 2(b)(iv) is
applicable, a `Bonus Annual Incentive Payment; provided, however, that (1) the City shall
not be required pursuant to this subsection 2(b) to remit an Annual Incentive Payment or a
Bonus Annual Incentive Payment to the Company in excess of the Annual Cap (as defined
in subsection 2(b)(v)) in any calendar year, and (2) the aggregate amount of all Annual
Incentive Payments remitted pursuant to this subsection 2(b) by the City to the Company
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shall not exceed Nineteen Thousand and 00 /100 Dollars ($19,000.00) and if the
requirements of subsection 2(c)(iv) are satisfied, the aggregate amount of all Annual
Incentive Payments and Bonus Annual Incentive Payments remitted pursuant to this
subsection 2(b) by the City to the Company shall not exceed Thirty Thousand and 00 /100
Dollars ($30,000.00).
(iv) Bonus Annual Incentive Payments and Related Annual Can The City
agrees that if (A) the Company provides to the City prior to December 31, 2015 a fully
executed copy of an agreement which either (1) extends the existing lease (as described in
Section 1(a)) for a minimum additional term of three (3) years or (2) obligates the Company
to a lease space at another location within the City for a minimum additional term of three
(3) years and (B) the Actual Withholdings in respect of either of the calendar years 2016 or
2017 equal or exceed the Target Withholdings (as defined in subsection 2(b)(v)) for the then
preceding calendar year, then the Company shall be eligible to receive a Bonus Annual
Incentive Payment in respect of such calendar year which will be calculated at the time and
in the manner as described in subsection 2(b)(iii) and paid in accordance with this Section 2;
provided that each Bonus Annual Incentive Payment shall be subject to an Annual Cap (as
defined in subsection 2(b)(v)) in each such calendar year.
(v) Target Withholdings and Annual Can The Target Withholdings and Annual
Cap for each of the calendar years 2012 through 2015, and if applicable, 2016 and 2017,
shall be:
Calendar Year
Target Withholdings
Annual Cap
2012
$ 36,000
$ 4,000
2013
42,000
4,500
2014
48,000
5,000
2015
54,000
5,500
2016
58,000
5,500
2017
60,000
5,500
(vi) Forfeiture of Right to Receive Workforce Creation Incentive Payment The
Company agrees and acknowledges that Annual Incentive Payments provided for in
subsection 2(b) are being made by the City to the Company in consideration for the
Company's agreement to execute a lease within the City for the retention of an office and
associated operations and workforce within the City and to create additional employment
opportunities and retain existing employment opportunities, all within the City. The
Company further agrees that if the Target Withholdings requirement is not met for any
given calendar year as set forth in subsection 2(b)(v), the City shall not be obligated to make
an Annual Incentive Payment or a Bonus Annual Incentive Payment, as applicable, to the
Company for the calendar year in respect of which the Target Withholdings requirement
was not satisfied. Failure to satisfy the Target Withholdings requirement in respect of any
one calendar year does not prohibit the Company from receiving an Annual Incentive
Payment for any subsequent calendar year in respect of which the Target Withholdings
requirement is satisfied. Subject to subsection 2(b)(iv), failure to satisfy the Target
Withholdings requirement in respect of any one calendar year does not prohibit the
SSD #808843v1: 09 -27 -2011 - 3 -
Company from receiving a Bonus Annual Incentive Payment for any subsequent calendar
year in respect of which the Target Withholdings requirement is satisfied.
(c) Method of Payment The payments to be paid to the Company as provided in this
Section 2 shall be made by the City to the Company by electronic funds transfer or by such other
manner as is mutually agreed to by the City and the Company.
(d) City's Obligation to Make Payments Not Debt: Payments Limited to Non -Tax
Revenues Notwithstanding anything to the contrary herein, the obligations of the City pursuant
to this Agreement shall not be a general obligation debt or bonded indebtedness, or a pledge of
the general credit or taxes levied by the City, and the Company shall have no right to have
excises or taxes levied by the City, the State or any other political subdivision of the State for the
performance of any obligations of the City herein. Consistent with Section 13 of Article VIII,
Ohio Constitution, any payments or advances required to be made by the City pursuant to this
Section 2 shall be payable solely from the City's non -tax revenues. Further, since Ohio law
limits the City to appropriating monies for such expenditures only on an annual basis, the
obligation of the City to make payments pursuant to this Section 2 shall be subject to annual
appropriations by the City Council and certification by the Director of Finance of the City as to
the availability of such non -tax revenues. For purpose of this Agreement, "nontax revenues"
shall mean, all moneys of the City which are not moneys raised by taxation, to the extent
available for such purposes, including, but not limited to the following: (i) grants from the
United States of America and the State; (ii) payments in lieu of taxes now or hereafter authorized
to be used for the purposes by State statute; (iii) fines and forfeitures which are deposited in the
City's General Fund; (iv) fees deposited in the City's General Fund from properly imposed
licenses and permits; (v) investment earnings on the City's General Fund and which are credited
to the City's General Fund; (vi) investment earnings of other funds of the City that are credited
to the City's General Fund; (vii) proceeds from the sale of assets which are deposited in the
City's General Fund; (viii) rental income which is deposited in the City's General Fund; and (ix)
gifts and donations.
Section 3. Miscellaneous.
(a) Assignment This Agreement may not be assigned without the prior written consent
of all non - assigning Parties.
(b) Binding Effect The provisions of this Agreement shall be binding upon the
successors or assigns of the Parties.
(c) Captions The captions and headings in this Agreement are for convenience only
and in no way define, limit or describe the scope or intent of any provisions or sections of this
Agreement.
(d) Day for Performance Wherever herein there is a day or time period established for
performance and such day or the expiration of such time period is a Saturday, Sunday or legal
holiday, then such time for performance shall be automatically extended to the next business day.
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(e) Entire Agreement This Agreement embodies the entire agreement and
understanding of the Parties relating to the subject matter herein and therein and may not be
amended, waived or discharged except in an instrument in writing executed by the Parties.
(f) Events of Default and Remedies Except as otherwise provided in this Agreement,
in the event of any default in or breach of this Agreement, or any of its terms or conditions, by any
Party hereto, such defaulting Party shall, upon written notice from any non - defaulting Party,
proceed immediately to cure or remedy such default or breach, and, in any event, within thirty (30)
days after receipt of such notice. In the event such default or breach is of such nature that it cannot
be cured or remedied within said thirty (30) day period, then in such event the defaulting Party shall
upon written notice from any non - defaulting Party commence its actions to cure or remedy said
breach within said thirty (30) day period, and proceed diligently thereafter to cure or remedy said
breach. In case such action is not taken or not diligently pursued, or the default or breach shall not
be cured or remedied within a reasonable time, the aggrieved non - defaulting Party may institute
such proceedings as may be necessary or desirable in its opinion to cure and remedy such default or
breach, including, but not limited to, proceedings to compel specific performance by the defaulting
Party.
(g) Executed Counterparts This Agreement may be executed in several counterparts,
each of which shall be deemed to constitute an original, but all of which together shall constitute but
one and the same instrument It shall not be necessary in proving this Agreement to produce or
account for more than one of those counterparts.
(h) Extent of Covenants; No Personal Liability All covenants, obligations and
agreements of the Parties contained in this Agreement shall be effective to the extent authorized and
permitted by applicable law. No such covenant, obligation or agreement shall be deemed to be a
covenant, obligation or agreement of any present or future member, officer, agent or employee of
the City or the Company other than in his or her official capacity, and neither the members of the
legislative body of the City nor any official executing this Agreement shall be liable personally
under this Agreement or be subject to any personal liability or accountability by reason of the
execution thereof or by reason of the covenants, obligations or agreements of the City and the
Company contained in this Agreement.
(i) Governing Law This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio or applicable federal law. All claims, counterclaims, disputes and
other matters in question between the City, its agents and employees, and the Company, its
employees and agents, arising out of or relating to this Agreement or its breach will be decided in a
court of competent jurisdiction within Franklin County, Ohio.
0) Legal Authority The Parties respectively represent and covenant that each is legally
empowered to execute, deliver and perform this Agreement and to enter into and carry out the
transactions contemplated by this Agreement. The Parties further respectively represent and
covenant that this Agreement has, by proper action, been duly authorized, executed and delivered by
the Parties and all steps necessary to be taken by the Parties have been taken to constitute this
Agreement, and the covenants and agreements of the Parties contemplated herein, as a valid and
binding obligation of the Parties, enforceable in accordance with its terms.
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(k) Limit on Liability Notwithstanding any clause or provision of this Agreement to
the contrary, in no event shall City or the Company be liable to each other for punitive, special,
consequential, or indirect damages of any type and regardless of whether such damages are claimed
under contract, tort (including negligence and strict liability) or any other theory of law.
(1) Notices Except as otherwise specifically set forth in this Agreement, all notices,
demands, requests, consents or approvals given, required or permitted to be given hereunder shall be
in writing and shall be deemed sufficiently given if actually received or if hand - delivered or sent by
recognized, overnight delivery service or by certified mail, postage prepaid and return receipt
requested, addressed to the other Party at the address set forth in this Agreement or any addendum
to or counterpart of this Agreement, or to such other address as the recipient shall have previously
notified the sender of in writing, and shall be deemed received upon actual receipt, unless sent by
certified mail, in which event such notice shall be deemed to have been received when the return
receipt is signed or refused. For purposes of this Agreement, notices shall be addressed to:
(i) the City at: City of Dublin, Ohio
5800 Shier Rings Road
Dublin, Ohio 43016 -7295
Attention: Economic Development Director
(ii) the Company at: Socius 1, LLC
5747 Perimeter Drive
Dublin, Ohio 43017
Attention:
The Parties, by notice given hereunder, may designate any further or different addresses to which
subsequent notices; certificates, requests or other communications shall be sent.
(m) No Waiver No right or remedy herein conferred upon or reserved to any Party is
intended to be exclusive of any other right or remedy, and each and every right or remedy shall be
cumulative and in addition to any other right or remedy given hereunder, or now or hereafter legally
existing upon the occurrence of any event of default hereunder. The failure of any Party to insist at
any time upon the strict observance or performance of any of the provisions of this Agreement or to
exercise any right or remedy as provided in this Agreement shall not impair any such right or
remedy or be construed as a waiver or relinquishment thereof. Every right and remedy given by this
Agreement to the Parties hereto may be exercised from time to time and as often as may be deemed
expedient by the parties hereto, as the case may be.
(n) Recitals The Parties acknowledge and agree that the facts and circumstances as
described in the Recitals hereto are an integral part of this Agreement and as such are incorporated
herein by reference.
(o) Severability If any provision of this Agreement, or any covenant, obligation or
agreement contained herein is determined by a court to be invalid or unenforceable, that
determination shall not affect any other provision, covenant, obligation or agreement, each of which
SSD #808843v1: 09 -27 -2011 -6-
shall be construed and enforced as if the invalid or unenforceable portion were not contained herein.
That invalidity or unenforceability shall not affect any valid and enforceable application thereof, and
each such provision, covenant, obligation or agreement shall be deemed to be effective, operative,
made, entered into or taken in the manner and to the full extent permitted by law.
(p) Survival of Representations and Warranties All representations and warranties of
the Parties in this Agreement shall survive the execution and delivery of this Agreement.
(remainder of page intentionally left blank— signature page follows)
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IN WITNESS WHEREOF, the City and the Company have caused this Agreement to be
executed in their respective names by their duly authorized representatives, all as of the date first
written above.
CITY OF DUBLIN, OHIO
Printed: Marsha I. Grigsbv
Title: Citv Manager
Approved as to Form:
C
Printed: Stephen J. Smith
Title: Director of Law
SOCIUsl, LLC
Printed:
Title:
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FISCAL OFFICER'S CERTIFICATE
The undersigned, Director of Finance of the City under the foregoing Agreement, certifies
hereby that the moneys required (if any) to meet the obligations of the City under the foregoing
Agreement during Fiscal Year 2011 have been appropriated lawfully for that purpose, and are in the
Treasury of the City or in the process of collection to the credit of an appropriate fund, free from
any previous encumbrances. This Certificate is given in compliance with Sections 5705.41 and
5705.44, Ohio Revised Code.
Dated: .2011
Angel Mumma
Director of Finance
City of Dublin, Ohio
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