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HomeMy WebLinkAbout11776RESOLUTION NO. 11776 A RESOLUTION APPROVING A TERMINATION AGREEMENT BETWEEN THE CITY OF PUEBLO AND THE WATER COMPANY RELATING TO A JOB CREATING CAPITAL IMPROVEMENT PROJECT AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAME BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Termination Agreement dated as of December 28, 2009 between the City of Pueblo and The Water Company relating to a job creating capital improvement project, a copy of which is attached hereto, having been approved as form by the City Attorney, is hereby approved. SECTION 2. The President of the City Council is authorized to execute the Termination Agreement in the name of the City with such modification thereto as the President of the City Council and the City Attorney shall approve. The City Clerk is directed to affix the seal of the City thereto and attest same. INTRODUCED: December 28, 2009 BY: Michael Occhiato COUNCILPERSON APPR D' } �- PRESIDENTaf Cfty Council A77TSTED DY: CITY CLERK ED Background Paper for Proposed RESOLUTION AGENDA ITEM # M -4 DATE: December 28, 2009 DEPARTMENT: Law Department TITLE A RESOLUTION APPROVING A TERMINATION AGREEMENT BETWEEN THE CITY OF PUEBLO AND THE WATER COMPANY RELATING TO A JOB CREATING CAPITAL IMPROVEMENT PROJECT AND AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAME ISSUE Should City Council approve the Termination Agreement? Approve the Termination Agreement BACKGROUND The Water Company ( "Company ") has requested that its March 23, 2009 agreement with the City be terminated which will require the Company to convey to the City the property previously conveyed to it by the City. The Termination Agreement cancels and terminates the March 23, 2009 agreement and requires the Company to convey the property back to the City. FINANCIAL IMPACT Terminating the Agreement with Company will make $2.8 million previously committed to Company available for other job creating capital improvement projects. TERMINATION AGREEMENT THIS TERMINATION AGREEMENT entered into as of December 28, 2009 between the City of Pueblo, a municipal corporation ( "City ") and The Water Company, LLC, a Delaware limited liability company ( "Company "), WITNESSETH: WHEREAS, City and Company entered into an Agreement dated as of March 23, 2009 and First Amendment dated as of July 13, 2009 relating to a job creating capital improvements project (collectively the "Prior Agreement "), and WHEREAS, City and Company are desirous of terminating and cancelling the Prior Agreement. NOW, THEREFORE, follows: In consideration of the foregoing and mutual covenants set forth herein, City and Company agree as 1. Company will convey to City by special warranty deed, fee simple marketable title, free of liens and encumbrances, and general property taxes assessed in 2009 and payable in 2010 except Existing Exceptions as defined in paragraph 2 below, to Lot 2, Pueblo Memorial Airport Industrial Park Subdivision, Third Filing, Pueblo County, Colorado; street address: 3 Jetway Court, Pueblo, Colorado, 81001 ( "Lot 2 "). The special warranty deed shall be in such form and content as the City Attorney shall approve. 2. City shall, at its expense, cause to be furnished by Land Title Guaranty Company and delivered to City an "ALTA" Owner's Policy (06- 17 -06) title insurance commitment to insure fee simple title to Lot 2 in the name of the City in the amount of $800,000.00 subject only to general property taxes for 2011 and subsequent years and those matters of record on August 4, 2009 ("Existing Exceptions "). The title insurance policy shall be issued and delivered to City as soon as practicable after recording the special warranty deed. 3. Company represents and warrants to the City that with respect to Lot 2 (a) no person or entity has any lien, or a right to a lien, for services, labor or material heretofore or hereafter furnished, (b) there are no existing leases or tenancies, and (c) there are no other liens, defects, encumbrances, adverse claims or other matters or record or affecting Lot 2, except the Existing Exceptions. Company's representations and warranties set forth in this Paragraph 3 shall survive the recording of the special warranty deed and shall not be deemed to be merged by the special warranty deed. 4. City will upon recording of the special warranty deed and receipt of the title insur -ance policy cause Company's deed of trust recorded August 4, 2009 in the records of the Pueblo County Clerk and Recorder at Reception No. 1814174 to be released of record and, thereafter, deliver to Company, Company's Promissory Note dated March 23, 2009 in the principal amount of $1,380,000.00 payable to City marked "cancelled." 5. Upon compliance with paragraphs 1, 2, 3 and 4 above, the Prior Agreement shall be cancelled and terminated and each party shall be released and discharged from all obligations thereunder. 6. This Termination Agreement shall be binding upon and inure to the benefit of Company and City and their respective successors and approved assigns. 7. In the event of any litigation arising under this Agreement, the court shall award to the prevailing party its costs and reasonable attorney fees. Venue for any such litigation shall be Pueblo County, Colorado. All such litigation shall be filed in the District Court, County of Pueblo, State of Colorado and each party submits to the jurisdiction of such District Court. To the extent allowed by law, each party waives its right to a jury trial. 8. The persons signing this Termination Agreement in the name of and on behalf of Company represent and warrant that they and Company have the requisite power and authority to enter into, execute, and deliver this Termination Agreement, and that this Termination Agreement is a valid legally binding obligation of Company enforceable against Company in accordance with its terms. 9. This Agreement shall be construed in accordance with and be governed by the laws of the State of Colorado without regard to conflict of law principles. 10. This Termination Agreement sets forth the entire and complete understanding and agreement of the parties with respect to the subject matter hereof and is for the benefit of City and Company and not for the benefit of any third party. No third party shall have any right or remedy hereunder or the right to enforce any provision of this Termination Agreement. 11. Company currently conducts its business operations at a facility located in the Pueblo Memorial Airport Industrial Park ( "Facility "). Company will make good faith efforts, depending upon its business development, to employ 140 full -time employees at the Facility ( "Employment Commitment'). If Company continues�in its good faith efforts to meet its Employment Commitment, City, in its sole and absolute discretion, will consider entering into a job creating capital improvement project agreement with Company, provided, however, that City shall have no obligation to enter into any such agreement. [SEAL ] Pueblo, a Municipal Corporation Attest_: City rlc [SEAL] M By 7,eG G7�z_. President of the City Council THE WATER COMPANY, LLC, a D aware Limiteq Ijiab 'li Company By .. Name: V Title: 0 I W SPECIAL WARRANTY DEED (Pursuant to 38 -30 -115, C.R.S.) THIS DEED, made on August 5, 2009 by THE WATER COMPANY, LLC, A DELAWARE LIMITED LIABILITY COMPANY, Grantor, whose address is 350 Keeler Parkway, Pueblo, Colorado, 81001, for the consideration of TEN and No /100 DOLLARS ($10.00) in hand paid, hereby sells and conveys to PUEBLO, A MUNICIPAL CORPORATION, Grantee, whose street address is 1 City Hall Place, Pueblo, CO, 81003, the following real property in the County of Pueblo, and State of Colorado, to wit: LOT 2, PUEBLO MEMORIAL AIRPORT INDUSTRIAL PARK SUBDIVISION THIRD FILING, COUNTY OF PUEBLO, STATE OF COLORADO, also known by street and number as: 3 Jetway Court, Pueblo, CO, 81001 with all its appurtenances and warrants the title against all persons claiming under the Grantor, subject to all taxes and assessments for the year 2010 and easements and reservations of record. THE WATER COMPANY, LLC A DELAWARE LIMITED LIABILITY COMPANY i By: Victoria K Hauser, Chief Financial Officer State of 1 c b if A- ) . County of t e 6 — L C� ss. The foregoing instrument was acknowledged before me on this / day of Jaiafry, 2010 by Victoria K. Hauser as Chief Financial Officer of THE WATER COMPANY, LLC, A DELAWARE LIMITED LIABILITY COMPANY 5311dX9 uoissiwwoa ,CND Witness my hand an@ of� &�;� JO 31V1S M com t on �� prix ld kd\ /iON My `gym), �`pJ i;S�3)1 ^d 'd N100d When recorded return to: City of Pueblo, a Municipal Corporation, 3 Jetway Court, PUEBLO, CO, 8 100 1.