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HomeMy WebLinkAbout12075RESOLUTION NO. 12075 A RESOLUTION APPROVING THE AGREEMENT BETWEEN PUEBLO, A MUNICIPAL CORPORATION, FRE COMPOSITES USA INC., AND PUEBLO DEVELOPMENT FOUNDATION RELATING TO A JOB CREATING CAPITAL IMPROVEMENT PROJECT, APPROVING A CONTRACT TO BUY AND SELL REAL ESTATE AND A LEASE IN CONNECTION WITH SAME, AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAID AGREEMENT, CONTRACT AND LEASE, AND TRANSFERRING $1,025,300 FROM THE 1992-2011 SALES AND USE TAX CAPITAL IMPROVEMENT PROJECTS FUND THEREFOR BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The City Council finds and determines that the expenditure of $1,025,300 for the job creating capital improvement project with FRE Composites USA Inc. described in the attached Agreement, meets and complies with the criteria and standards established by Ordinance No. 6381 and will create employment opportunities justifying the expenditure of public funds. SECTION 2. The Agreement dated as of January 25, 2011 between Pueblo, a Municipal Corporation, FRE Composites USA Inc. and Pueblo Development Foundation relating to a job creating capital improvement project, a copy of which is attached hereto (“Agreement”), having been approved as to form by the City Attorney, is hereby approved. The President of the City Council is authorized to execute and deliver the Agreement in the name of the City and the City Clerk is directed to affix the seal of the City thereto and attest same. SECTION 3. The Contract to Buy and Sell Real Estate dated as of November 15, 2010 between the City of Pueblo, a Municipal Corporation and Greenhorn Drive, LLC., including Addendum No. 1 thereto, a true copy of which is attached hereto (“Contract”), having been approved as to form by the City Attorney, is hereby approved. The President of City Council is authorized to execute and deliver the Contract in the name and on behalf of the City and the City Clerk is directed to affix the seal of the City thereto and attest same. SECTION 4. The Lease dated as of January 25, 2011 between Pueblo, a Municipal Corporation and FRE Composites USA Inc., a copy of which is attached hereto, having been approved as to form by the City Attorney, is hereby approved. The President of City Council is authorized to execute and deliver the Lease in the name and on behalf of the City and the City Clerk is directed to affix the seal of the City thereto and attest same. SECTION 5. Funds in the aggregate amount of $1,025,300 are hereby authorized to be transferred, expended and made available out of the 1992-2011 Sales and Use Tax Capital Improvement Projects Fund for the sole purpose of the job creating capital improvement project and in the manner described in the Agreement. The funds hereby authorized to be transferred and expended shall be held by the City and released, disbursed and paid by the Director of Finance in the following manner: the sum of $750,000 to Greenhorn Drive, LLC pursuant to and in accordance with the terms of the Contract; the sum of $30,000 to Pueblo Development Foundation (“PDF”) for the benefit of FRE Composites USA Inc. (“Company”); the sum of $240,000 to Company for acquisition of equipment, upon compliance by Company with section 2(b) of the Agreement and after receipt by the Director of written requests for payment in compliance with paragraphs 2(c) and 2(d) of the Agreement; the sum of $1,500 to PDF for its services and expenses in connection with the renovation and remodeling of facilities for Company; and the sum of $5,300 for appraisal services, environmental inspection services and closing costs. SECTION 6. The officers of the City are directed and authorized to perform any and all acts consistent with the intent of this Resolution and attached Agreement to effectuate the transactions described therein. SECTION 7. This Resolution shall become effective upon final approval and passage. INTRODUCED: January 24, 2011 BY: Judy Weaver Background Paper for Proposed RESOLUTION DATE:AGENDA ITEM # Q-1 January 24, 2011 DEPARTMENT: Law Department Thomas J. Florczak, City Attorney TITLE A RESOLUTION APPROVING THE AGREEMENT BETWEEN PUEBLO, A MUNICIPAL CORPORATION, FRE COMPOSITES USA INC., AND PUEBLO DEVELOPMENT FOUNDATION RELATING TO A JOB CREATING CAPITAL IMPROVEMENT PROJECT, APPROVING A CONTRACT TO BUY AND SELL REAL ESTATE AND A LEASE IN CONNECTION WITH SAME, AUTHORIZING THE PRESIDENT OF THE CITY COUNCIL TO EXECUTE SAID AGREEMENT, CONTRACT AND LEASE, AND TRANSFERRING $1,025,300 FROM THE 1992-2011 SALES AND USE TAX CAPITAL IMPROVEMENT PROJECTS FUND THEREFOR ISSUE Should City Council approve the Agreement between the City, Pueblo Development Foundation (“PDF”) and FRE Composites USA Inc. (“Company”) and related agreements? The related agreements are a Contract to Buy and Sell the real property to be remodeled by PDF and used as a facility for Company, and a Lease of the property to Company. RECOMMENDATION PEDCO recommends that City Council approve the Agreement and related agreements. BACKGROUND The Company is a Delaware corporation associated with a Canadian pipe manufacturer which is interested in opening a fiberglass composite pipe manufacturing facility within the City of Pueblo. The Agreement authorizes the expenditure of $1,025,300 from the 1992-2011 Sales and Use Tax Capital Improvement Projects Fund (“Funds”) as an employment incentive for thirty (30) full-time employees whose annual compensation shall average at least $43,000. Funds in the amount of $750,000 will be used for the purchase of property and an industrial building at 60 Greenhorn Drive, Pueblo, CO, and $30,000 to remodel and renovate the building for the Company’s use. The amount of the economic incentive provided to Company is $510,000, which also includes disbursement of $240,000 for acquisition of equipment, and the Company will lease the facility under a subsidized “triple-net” lease for ten (10) years with monthly rent of $2583.34 per month during the first 36 months of the term and $4964.28 per month for the last 84 months of the term based upon the remaining $510,000 of investment of Funds. The lease subsidy is $240,000, and the lease allows the Company to purchase the property during the last 36 months of the lease for a sum equal to the remaining lease payments. In the event Company defaults in its employment commitment, Company will repay the $510,000 economic incentive on a pro-rata basis. The employment commitment date is February 1, 2014 and the repayment period is 7-years after the employment commitment date. PDF will provide services under the Agreement in managing the renovation of the facility for a lump sum payment of $1,500. The remaining $5,300 transferred for the project are for the City’s costs associated with appraisal, environmental inspection and closing costs. FINANCIAL IMPACT See Background. Final 1/17/11 AGREEMENT THIS AGREEMENT ( "Agreement ") is entered into as of January 25, 2011 between Pueblo, a Municipal Corporation (the "City "), FRE Composites USA Inc , a Delaware corporation (the "Company ") and Pueblo Development Foundation, a Colorado nonprofit corporation ( "PDF ") WHEREAS, Company has expressed a willingness to locate a manufacturing facility within the City of Pueblo, and in furtherance thereof has, through the Pueblo Economic Development Corporation, made application for funds and other economic incentives to the City, and WHEREAS, in connection with its application, Company has committed to invest not less than U S $ 600,000 00 in fixed assets in a manufacturing facility it will locate within the City of Pueblo, and to provide the employment described in section 6 of this Agreement; and WHEREAS, the City has approved such application and will make certain funds and other economic incentives available to Company subject to and upon the terms and conditions of this Agreement; and WHEREAS, PDF is experienced in and willing to perform construction management services in connection with the renovation and remodeling of property to be used by Company for its manufacturing facility; NOW, THEREFORE, in consideration of the foregoing and the mutual covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, City and Company agree as follows 1 The following terms as used in this Agreement shall have the following meaning unless the context clearly indicates otherwise "Effective Date" means the date of approval of this Agreement by City Council of City "Employment Commitment Date" means February 1, 2014 "Equipment" means manufacturing equipment, including automated thermoset filament winding equipment and other related machinery to be acquired, installed, maintained and used by Company in the Facility, which Equipment shall have a useful economic life of not less than 120 months. "Facility" means the manufacturing and warehouse facility located on Lots 9 and 10, Minnequa Industrial Park, First Filing, County of Pueblo, State of Colorado, also known and numbered as 60 Greenhorn Drive, Pueblo, Colorado, 81004, wherein Company will conduct its 1 manufacturing operations for production of goods for distribution and sale outside of Pueblo County, Colorado "Full -Time Employee" means a person who actually performs work at the Facility for not less than thirty -five (35) hours per week whether employed by Company or by an outside entity acting as an agency to provide Full -Time Employees for Company The term "Full -Time Employee" does not include independent contractors nor employees of independent contractors except employees performing work at the Facility who are employees of an independent contractor acting as an agency to provide Full -Time Employees for Company "Lease" means a lease in substantially the same form and content as the Lease attached hereto as Exhibit "A." "Quarter" means three consecutive calendar months commencing January 1, April 1, July 1 and October 1 of each calendar year "Quarterly Employees" means the sum of the aggregate number of Full -Time Employees on each business day of a Quarter, divided by the sum of the aggregate business days in such Quarter "Salary" means direct compensation payable to an employee including vacation pay, bonuses, overtime compensation and the amount of any pretax benefits paid by the employee under flexible spending or other qualified plans The term does not include employer paid payroll taxes nor benefits such as employer paid health insurance. "Security Agreement" has the meaning set forth in Section 8 2 If Company is not in default hereunder, City will, after the Effective Date, disburse to PDF , for the benefit of Company, funds in an amount not to exceed U S $30,000 00 for the actual costs and expenses of remodeling and renovating the Facility and landscaping the Facility, including the costs of design, engineering and construction services, and will disburse directly to Company, solely for reimbursement for the acquisition of Equipment by Company at fair market value from a reputable vendor in an arms - length transaction, or if not acquired in an arms length transaction, supported by an appraisal performed by a qualified independent appraiser, funds in the amount of U S $240,000 00 (collectively, the disbursement for costs of remodeling and renovation and the reimbursement for Equipment being referred to as the "City Funds "), all of which is subject to and contingent upon the following conditions and covenants which Company and PDF, as applicable, agree to perform and comply with. (a) Plans and Bidding. (I) PDF shall determine Company's needs for remodeling, renovation and landscaping of the Leased Property and in consultation with Company, shall cause plans and specifications to be prepared for the work. The plans and specifications shall be filed with the City, and work shall not be performed until and unless the same are approved by City, which approval shall not be unreasonably withheld. 2 `// (II) All construction contracts for the work contemplated by the approved plans and specifications ( "Construction Contracts ") shall be awarded by competitive bidding. PDF shall invite general contractors holding Building Contractors -A (General Unlimited) licenses having their principal place of business in the City or County of Pueblo who are qualified and experienced to perform construction work for the Project ( "Local Contractors ") to submit bids PDF may invite other qualified general contractors with their principal place of business outside of Pueblo County, Colorado to submit bids. PDF shall assure that the same scope of work to be bid is timely furnished to each general contractor invited to bid. For "design - build" or other contractual arrangements, this requirement maybe accomplished by a pre -bid conference or other acceptable competitive bidding procedure which allows Local Contractors a reasonable opportunity to participate in the competitive bidding procedures. All bids will be received and opened publicly PDF will use its best efforts in good faith to award the construction contract to the lowest qualified bidder A similar provision with respect to local subcontractors and suppliers shall be included as part of the construction contract between the Applicant and the general contractor who shall use its best efforts in good faith to engage local subcontractors and suppliers for such construction. If the Company, its employees or agents had negotiated with a general contractor, subcontractor or supplier with respect to a Project prior to competitive bidding, neither the Company nor PDF shall enter into any Construction Contract with such general contractor, subcontractor or supplier for the Project. "Negotiate" means to discuss, confer upon, or arrange the terms and conditions of a Construction Contract 'including, without limitation, obtaining estimates of construction costs After award, PDF shall enter into one or more Construction Contracts for the work and cause the remodeling and renovation to be expeditiously completed, and PDF shall timely pay all contractors for work upon the Facility PDF shall not allow nor suffer any mechanics hens to be filed upon the Facility and in the event any such liens are filed, shall cause same to be promptly removed. (III) City Funds will be disbursed by City to PDF solely for the costs of design, renovation and remodeling of the Leased Property in accordance with the plans and specifications approved by City, and for landscaping of the Facility In the event the cost of the design, remodeling, renovation and landscaping exceeds U S $30,000 00 of available City Funds, such costs shall be promptly paid by Company and not by City (IV) Upon substantial completion of the remodeling and renovation of the Leased Premises, as reasonably determined in writing by the City's Director of Public Works, Company shall promptly occupy the Leased Premises in accordance with the terms of the Lease The date of the written determination by the Director of Public Works shall be deemed the date of substantial completion of the renovation and remodeling. Any failure to install or complete landscaping of the Leased premises shall not affect the determination of substantial completion. (V) Upon said substantial completion of the renovation and remodeling of the Leased Premises, City shall pay to PDF, as full compensation for its services and expenses in connection with the renovation and remodeling of the Leased Premises, the sum of U S $1,500 00 (b) Company shall file in the office of the City Clerk copies of the following: (i) Company's certificate or other evidence of authority to transact business in the State of Colorado 3 issued by the Colorado Secretary of State, together with Company's certificate of good standing issued by the governmental jurisdiction of Company's formation, (ii) certified copy of the resolution of the governing board of Company approving this Agreement, the Lease, and the Security Agreement and authorizing its officers to execute and deliver this Agreement, the Lease, the Secunty Agreement and related documents in the name of Company, (in) this Agreement, the Lease and the Security Agreement executed by authorized officers of Company, and (iv) evidence reasonably satisfactory to City that Company will commence manufacturing operations at the Facility The date of the last to occur of the filings required under (i), (ii), (ni), and (iv) of this section 2(b) shall be referred to herein as "Closing" If either the Effective Date or Closing does not occur on or before January 31, 2011, or such later date as Company and City shall mutually agree, City, at its sole option, may terminate this Agreement and City and Company shall thereafter be released and discharged from all obligations hereunder (c) As conditions precedent to the disbursement of City Funds for the renovation and remodeling of the Leased Premises, (i) Company and PDF shall have obtained City's written approval of the plans and specifications for the renovation and remodeling of the Leased Premises, (n) Company shall file with the City Clerk the documents described in subsection (b) above, and (iii) PDF shall file with the City's Director of Finance, periodic written requests for payment, certified to be true and correct by an officer of Company, representing that the amounts included in the request for payment have not been included in any prior request for payment and are for the actual cost of remodeling the Facility and landscaping the Facility paid by PDF, identifying the specific work for which payment is sought, including paid invoices therefor and certificates of delivery and installation in the Facility PDF shall not submit requests for payment which exceed in the aggregate U S $30,000 00 (d) As conditions precedent to the disbursement of City Funds for the acquisition of Equipment, Company shall file (i) with the City Clerk, the documents described in subsection (b) above, and (ii) with the City's Director of Finance, written request for payment, certified to be true and correct by an officer of Company, representing that the amounts included in the request for payment have not been included in any prior request for payment and are for the actual cost of Equipment paid by Company, identifying the Equipment for which payment is sought, including paid invoices therefor and certificates of delivery and installation in the Facility Company shall not submit requests for reimbursement which exceed m the aggregate U S $240,000 00 3 After the Effective Date, and subject to Company's compliance with section 2(b) of this Agreement, City will acquire Lots 9 and 10, Minnequa Industrial Park, First Filing, Pueblo County, Colorado, also known and numbered as 60 Greenhorn Drive, Pueblo, Colorado, 81004, at a cost of approximately U S $750,000 in order to make such property available to Company under the Lease. 4 Within thirty (30) days after the Effective Date and subject to Company's compliance with paragraph 2(b), City and Company shall execute the Lease. City may, but is not required to, retain PDF to serve as City's property manager under the Lease 5 City and Company stipulate and agree that the total economic incentives provided by 4 � 00, Amt City to Company under this Agreement, including both City Funds and the value of the rent subsidy (U S $240,000) under the Lease, is U S $510,000 00 (the "Total Economic Incentives ") 6 (a) Company acknowledges and agrees that the primary purpose of City in entering into this Agreement and the sole benefit to the City for making the Total Economic Incentives available to Company hereunder is the creation of additional jobs within the City Therefore, Company represents, covenants, and agrees that Company will, on and after the Employment Commitment Date, continuously conduct its business operations at the Facility and employ not less than thirty (30) Full -Time Employees at the Facility whose annual salary shall average at least U S $43,000 00 (the "Employment Commitment ") (b) Company will use good faith efforts in accordance with its sound business practices to (i) employ residents of the County of Pueblo as Full -Time Employees including, without limitation, engaging in reasonable programs and posting of employment openings in the City of Pueblo, and (ii) engage engineers, architects, contractors and suppliers whose principle places of business are located in Pueblo County, Colorado, in all construction work for or related to the Facility 7 Notwithstanding anything contained in this Agreement to the contrary, if Company shall for any reason default in its Employment Commitment, Company shall repay to City a pro -rata share of the Total Economic Incentives based upon the number of Full -Time Employees employed by Company at the Facility (the "Repayment Obligation "), as follows (a) During the seven (7) year period starting on the Employment Commitment Date and ending eighty -four (84) months thereafter (the "Repayment Period "), Company shall pay to City an amount for each Quarter equal to the Quarterly Employees less than thirty (30) Full -Time Employees employed at the Facility by Company multiplied by the Adjusted Quarterly Repayment Capitation (the "Company's Quarterly Payments ") The Adjusted Quarterly Repayment Capitation as of the date of this Agreement shall be U S $607 14 The Adjusted Quarterly Repayment Capitation shall be adjusted on February 15 each year beginning February 15, 2012 (and shall apply retroactively as of the preceding January 1) by the 12 month percentage increase over the previous year of the Consumer Price Index for "All Urban Consumers (CPI -U) All Items (1982 -1984 = 100)" for Denver - Boulder - Greeley published by the Bureau of Labor Statistics of the United States Department of Labor ( the "Bureau "), provided that if the Bureau ceases to publish the CPI -U or materially changes its composition, the City and Company shall agree to and use a comparable published statistic or index to adjust the Adjusted Quarterly Repayment Capitation to adjust for inflation. For example, if for the second Quarter of the third year after the Employment Commitment Date the Adjusted Quarterly Repayment Capitation is U S $625 00, and such Quarterly Employees are 25, the amount payable by Company to City on or before the fifteenth (15th) day of the next calendar month would be (30 - 25) x U S $625 00 = U S $3125 00 (b) Company's Quarterly Payments, if any, shall be paid to the City without notice, demand, deduction or setoff on or before the fifteenth (15th) day of the month following the end of each Quarter during the Repayment Period at the office of the Director of Finance of City, 150 Central Main Street, Pueblo, Colorado, 81003, or such other person or location as the City may 5 designate. All past due Company's Quarterly Payments shall bear interest at the rate of eight percent (8 %) per annum ( "Default Interest ") until paid. Company's Quarterly Payments shall be in addition to rent and other amounts payable under the Lease (c) Within fifteen (15) days after the end of each Quarter after the Employment Commitment Date and for one calendar month after the Repayment Period, Company will submit to City's Director of Finance Company's statements showing the Quarterly Employees for the preceding Quarter and their annual salary, together with the basis upon which Quarterly Employees and Company's Quarterly Payment, if any, were computed certified by an officer of the Company to be true and correct. For purposes of verifying Company's employment and salary, City shall have access to and the right to audit Company's records relating to Company's employees employed at the Facility (d) If Company defaults in any of its obligations under this Agreement including, without limitation, its Repayment Obligation, and such default is not cured within thirty (30) days after written notice specifying the default is given by City to Company, then in such event, the entire balance of Company's Repayment Obligation shall become due and payable, without notice, notice being hereby expressly waived, together with Default Interest from the date of default, and for such purpose, the entire balance of Company's Repayment Obligation shall be an amount equal to 30 times U S $607 14 or the then applicable Adjusted Quarterly Repayment Capitation, whichever is greater, multiplied by the remaining Quarters of the Repayment Period plus the amount of Company's unpaid Quarterly Payments, if any, but in no event more than the amount of the Total Economic Incentives actually provided by City to Company plus Default Interest. Company's Repayment Obligation is absolute and unconditional and shall not be abated, reduced, diminished, modified, withheld or otherwise offset for any cause or reason whatsoever 8 Company's Repayment Obligation under this Agreement shall be deemed to be a debt of Company payable to City until Company performs and discharges its obligations hereunder including, without limitation, its Repayment Obligation. Company's obligations under this Agreement including its Repayment Obligation shall be secured by a perfected first security interest in the Equipment, which Equipment shall have a fair market value of not less than the amount of the City Funds requested for reimbursement for Equipment at the time placed in the Facility By way of example, if a request for reimbursement for Equipment placed at the facility is made in the amount of U S $200,000, then at that time the value of the Equipment placed at the facility for which no previous reimbursement request has been submitted shall have a value of at least U S $200,000 Prior to any disbursement of funds by City for Equipment, Company shall execute and deliver to City Company's Security Agreement, Financing Statement and other documents required to perfect a first security interest in the Equipment all in form and content approved by City's Attorney (the "Security Agreement ") Company may be permitted from time to time to substitute items of replacement Equipment for items of Equipment removed from the Facility, provided that an amended Security Agreement meeting the requirements of this section is executed and delivered identifying the substitute items of Equipment and deleting the item of Equipment being replaced. 9 (a) Prior to instituting any proceeding to enforce Company's Repayment Obligation, City shall notify Company in writing of its intention to institute such proceedings. Company may request relief from its Repayment Obligation by delivering to City within twenty (20) 6 ` r; . days after date of City's notice, Company's written request for relief specifying the grounds upon which such relief is sought together with documents supporting said grounds Within ninety (90) days after receipt of Company's request, City will schedule a meeting with the City Council of City ( "City Council ") at which meeting Company may appear City will notify Company of the time and place of the meeting. Failure of Company to timely deliver its complete written request for relief or to appear at the scheduled meeting with the City Council shall entitle City to immediately institute proceedings to enforce Company's Repayment Obligation. (b) City Council may or may not, in its sole and absolute discretion, relieve Company, in whole or in part, from Company's Repayment Obligation. Any action taken by the City Council relating to a request for relief shall be final and binding on Company, and not subject to judicial review Any such action by City Council is, and shall constitute, a legislative measure. Nothing contained in this section 9 shall grant or be construed to grant to Company any right or claim to relief from its Repayment Obhgation or hearing with respect thereto (c) No delay by the City in scheduling a meeting, or failure by City to exercise its right to enforce this Agreement, including Company's Repayment Obligation, and no partial or single exercise of that right, shall constitute a waiver of that right. 10 In the event of any litigation arising under this Agreement, the court shall award to the prevailing party its costs and reasonable attorney fees. Exclusive venue for any such litigation shall be Pueblo County, Colorado All such litigation shall be filed in the District Court in and for the 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 11 This Agreement expresses the entire understanding of the parties and supersedes and abrogates any and all prior dealings and commitments, whether oral or written, with respect to the subject matter of this Agreement and may not be amended or modified except in writing signed by City and Company Any waiver of any provision of this Agreement must be in wntmg and signed by the party whose rights are being waived. No waiver of any breach of any provision hereof shall be or be deemed to be a waiver of any preceding or subsequent breach of the same or any other provision of this Agreement. The failure of any party to enforce or seek enforcement of the terms of this Agreement following any breach shall not be construed as a waiver of such breach. 12 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 13 Any notices hereunder shall be sufficiently given if given in writing personally or mailed by first class, registered, or certified mail, postage prepaid, addressed. (a) if to City, City Manager, City of Pueblo, 1 City Hall Place, Pueblo, Colorado, 81003, or (b) if to the Company, FRE Composites USA Inc., 75 Wales Street, Saint- Andre- d'Argenteuil, Quebec, Canada, JOV 1XO, Attention. Benoit Arsenault, (c) if to PDF, c/o Pueblo Economic Development Corporation, 301 N Main Street, Pueblo, CO 81003, Attention. Dan Centa, or to such other person or address as either party shall specify in written notice given to the other party pursuant to the provisions of this section 13 14 Time is of the essence hereof. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, provided Company may not assign this Agreement or any interest herein without the express written consent of City, which consent shall not be unreasonably withheld. Any assignment or attempted assignment of this Agreement by Company without such consent shall be null and void. No such assignment nor City's consent thereto shall release or discharge Company from any obligation or liability under this Agreement. 15 The persons signmg this Agreement in the name of and on behalf of Company, PDF and City each represent and warrant that they have the requisite power and authority on behalf of their respective entity to enter into, execute, and deliver this Agreement, and that this Agreement is a valid legally binding obligation of Company, PDF and City enforceable in accordance with its terms. 16 (a) Company and PDF each represent and warrant that no person, entity, or organization has been employed or retained or will receive or be paid, directly or indirectly, any commission, percentage, contingent fee or any other remuneration, payment or receipt of which is contingent upon approval of this Agreement or City providing the Total Economic Incentives hereunder, or any part thereof. For breach or violation of this warranty, City shall have the right to terminate this Agreement, or recover the full amount of such commission, percentage, contingent fee or other remuneration, and/or to seek such other remedies legally available to City, which remedies shall be cumulative (b) PDF agrees to indemnify, defend and hold City, its officers, agents and employees harmless from and against all claims and actions arising from the renovation and remodeling of the Facility 17 In no event shall City, its officers, agents or employees be hable to Company or PDF for damages, including without limitation, compensatory, punitive, indirect, special or consequential damages, resulting from or arising out of or related to this Agreement or the performance or breach thereof by City or the failure or delay of City in the performance of any covenant or provision under this Agreement on its part to be performed. In consideration of City entering into this Agreement, Company and PDF each hereby waive and discharge City, its officers, agents and employees from all claims for any and all such damages No breach, default, delay or failure of City under this Agreement shall be or be construed to be a waiver, discharge or release of Company's Repayment Obligation. Notwithstanding the foregoing, if City defaults in any material covenant of this Agreement, Company and PDF shall have the right, without the showing or any special damages or an inadequate remedy at law, to seek specific enforcement thereof, but not for damages of any type or nature. 8 6R 18 If any provision of this Agreement is declared by a court of competent junsdiction to be invalid or unenforceable, such determination shall not affect the other provisions of this Agreement which shall remain in full force and effect. 19 None of the parties shall be, or hold itself out as, agent of any other party or as ajomt venturer under this Agreement. 20 Each party acknowledges that this Agreement was fully negotiated by the parties and, therefore, no provision of this Agreement shall be interpreted against any party because such party or its legal representative drafted such provision. 21 The provisions of this Agreement are for the exclusive benefit of the parties hereto and their successors and permitted assigns, and no third party shall be a beneficiary, or have any rights by virtue of this Agreement. 22. This Agreement may be executed in any number of counterparts, and each such counterpart shall be deemed for all purposes to be an original, and all such counterparts shall together constitute but one and the same original. Executed at Pueblo, Colorado, the day and year first above written. 9 `�i [S E A L] Pueblo, • Mumci s al Corporation Attest: By AIL City rk President , f th /City Council [SEAL] FRE Composites USA Inc , a Delaw.. co •o - • •n Attest: aka , By Name , / A - 1. A, • ! Nam • Benoit Arsenault Title V) Ce- 1 J KVI Title President Pueblo Development Foundation, a Colorado nonprofit corporation By Title. / • - 10 Final 1 17 2011 EXHIBIT "A" LEASE THIS LEASE entered into as of January 25, 2011 by and between Pueblo, a Municipal Corporation (the "Lessor ") and FRE Composites USA Inc , a Delaware corporation (the "Lessee "), WITNESSETH. WHEREAS, Lessor is or will be the owner of or in control of Lots 9 and 10, Minnequa Industrial Park, First Filing, Pueblo County, Colorado, also known and numbered as 60 Greenhorn Drive, Pueblo, Colorado, 81004, consisting of approximately 5 41 acres of land together with an approximately 46,394 square foot building and other improvements (the "Leased Premises "), and WHEREAS, Lessee is desirous of leasing the Leased Premises and Lessor is willing to lease the Leased Premises to Lessee upon the terms and conditions hereinafter set forth. NOW, THEREFORE, in consideration of the foregoing and mutual promises, covenants and conditions contained herein, Lessor and Lessee hereby agree as follows Article 1. Leased Premises 1 01 Effective on Commencement Date, Lessor leases to Lessee and Lessee leases from Lessor the Leased Premises, upon and subject to the covenants, provisions and conditions herein. 1 02 "Easements" mean the Billboard, Utility and Sight Easements burdening the Leased Premises under the Easement Agreement recorded in the records of Pueblo County, Colorado, at Reception No 1763524 1 03 This Lease and Lessee's use of the Leased Premises are subject to the easements, including but not limited to the Easements, rights of way, covenants, conditions, restrictions, reservations and limitations appearing of record, and all applicable zoning and land use laws, ordinances, codes and regulations governing and regulating the Leased Premises and its use. 1 04 "Commencement Date" means the date of substantial completion of the renovation and remodeling of the Leased Premises as defined under that certain Agreement between Lessor and Lessee dated January 25, 2011 (the "City Agreement ") Article 2. Term. The Term of this Lease shall be ten (10) years commencing on Commencement Date and ending one hundred twenty (120) months thereafter, unless sooner terminated as herein provided (the "Termination Date ") Article 3. Rent. 3 01 Lessee shall pay to Lessor rent for the Leased Premises for the full Term of U S $510,000 00 payable in monthly installments as follows" during the first 36 months of the Term, U S $2583.34 per month, in advance, without notice or demand, with the first monthly installment due on the Commencement Date, and subsequent monthly installments due on the same day of each month thereafter; and thereafter for the remainder of the Term, U S $4964.28 per month, in advance, without notice or demand due on the same day of each month, until the full amount of rent has been paid. All payments shall be made or mailed via United States mail to the following address Pueblo Development Foundation (as property manager for Lessor), c/o Pueblo Economic Development Corporation, 301 N. Main Street, Pueblo, CO 81003 , or to such other person or address as Lessor may from time to time designate to Lessee in writing. 3 02 All monthly rent and other payments required to be made by Lessee hereunder which shall remain unpaid fifteen (15) days after their due dates shall bear interest at the rate of ten percent (10 %) per annum until paid. 3 03 Lessee's obligation to pay rent to Lessor hereunder is absolute and unconditional and rent shall not be offset, abated, reduced or withheld for any cause or reason whatsoever 3 04 It is the intent of the parties hereto that this Lease is a "triple net" lease with Lessor incurring no obligation, monetary or otherwise, hereunder 3 05 In the event that the City funds disbursed for renovation, remodeling and landscaping of the Leased Premises under Section 2 of the City Agreement are less than U S $30,000, the monthly rent installments shall be reduced by U S $8 33 per Thousand Dollars (U S $1,000 00) for each $1,000 less than the U S $30,000 00 so disbursed. Article 4. Use of Leased Premises 4 01 The Leased Premises shall be used and occupied by Lessee solely for manufacturing purposes and office space associated with or incident to Lessee's manufacturing operations, and ancillary parking and outside products storage (provided such storage complies with applicable subdivision covenants for same, if any) 4 02 Lessee shall use the Leased Premises in a careful, safe and proper manner m compliance with all laws and regulations applicable to the Leased Premises and Lessee's use thereof. Lessee shall not cause, maintain or permit any nuisance or waste in, on, or about the Leased Premises 4 03 Lessee shall not abandon or cease to conduct business on the Leased Premises for any period longer than 90 consecutive days Article 5. Condition of Premises 5 01 IT IS UNDERSTOOD AND AGREED THAT THE LEASED PREMISES ARE 2 hit LEASED "AS IS, WHERE IS, WITH ALL ITS FAULTS" AS OF THE COMMENCEMENT DATE AND THAT LESSOR IS NOT MAKING AND HAS NOT AT ANY TIME MADE ANY WARRANTY OR REPRESENTATION OF ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE LEASED PREMISES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OR REPRESENTATION AS TO HABITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE (OTHER THAN THE COVENANT OF QUIET POSSESSION SET FORTH IN ARTICLE 14), ZONING (OTHER THAN THAT THE BUILDING IS ZONED FOR INDUSTRIAL (I -3) USE), PHYSICAL OR ENVIRONMENTAL CONDITIONS, SIZE, UTILITIES, GOVERNMENTAL APPROVALS, THE COMPLIANCE OF THE LEASED PREMISES WITH GOVERNMENTAL AND ENVIRONMENTAL LAWS AND REGULATIONS, THE TRUTH, ACCURACY OR COMPLETENESS OF ANY DOCUMENT OR OTHER INFORMATION PROVIDED TO LESSEE BY LESSOR OR ANY OTHER PERSON, OR ANY OTHER MATTER OR THING REGARDING THE LEASED PREMISES 5 02 The taking of possession of the Leased Premises by Lessee on Commencement Date shall be conclusive evidence that the Lessee accepts the Leased Premises in its then present condition "AS IS, WHERE IS, AND WITH ALL FAULTS" and that the Leased Premises are in good and satisfactory condition at the time such possession was taken. 5 03 Lessor has obtained an ASTM Phase I environmental report and an asbestos inspection report from All -Phase Environmental Consultants, Inc ( "All -Phase Report") which has been made available to Lessee. Lessor disclaims any representations whatsoever regarding the accuracy or reliability of the All -Phase Report, and Lessee relies upon same at Lessee's sole risk. Lessee has been afforded the opportunity to conduct its own environmental investigation of the Leased Premises and has declined to do so Article 6. Alterations and Improvements. 6 01 Lessee shall not make any additions, alterations or improvements in or to the Leased Premises ( "Alterations ") without Lessor's prior written consent which consent shall not be unreasonably withheld. Lessee shall not permit or allow any hen to be filed or recorded against the Leased Premises or Lessor's or Lessee's interest therein, and Lessee shall fully cooperate with Lessor in obtaining the protections afforded Lessor under §38 -22 -105, C.R.S All Alterations made in or to the Leased Premises by Lessee with Lessor's consent shall become part of the Leased Premises and be surrendered with the Leased Premises at the termination of this Lease. All other alterations shall, at the option of Lessor, be removed by Lessee at its cost and expense. 6 02 All equipment, fixtures and improvements of a detachable or temporary nature installed or placed upon the Leased Premises by Lessee, including trade fixtures, shall remain the property of Lessee, subject to Lessee's right, at its option, to remove same not later than thirty (30) days after termination of this Lease Lessee shall repair all damage to the Leased Premises caused by such removal The failure of Lessee to remove its equipment, fixtures and detachable improvements within thirty (30) days after termination of this Lease shall, at the option of Lessor, be deemed an abandonment of such property and Lessor may dispose of such property as the Lessor, in its sole discretion, may determine 0 3 it ■ Article 7. Repairs and Maintenance. 7 01 Lessor shall not be obligated to repair, maintain or alter the Leased Premises or any part thereof. Lessee, at its expense, shall keep and maintain the Leased Premises, including, without limitation, the Buildings and the structural components, roofs, walls, fixtures, electrical, heating, mechanical, plumbing and air conditioning systems thereof, in good working condition and repair and in a good, clean and safe condition at all times during the effective term of this Lease and return the same to Lessor at Termination Date in as good condition and state of repair as the same were in as of Commencement Date, except for loss occasioned by ordinary wear 7 02 If Lessee becomes obligated to make repairs caused by an occurrence covered by the insurance described in Article 11, the net proceeds of such insurance shall be made available to Lessee to offset the cost of such repairs. Article 8. Right of Entry Lessor, or Lessor's officers, employees, agents and representatives, and property management representative, as the case may be, may enter the Leased Premises at any time during normal business hours without prior written notice to Lessee. Article 9. Assignment. Lessee shall not voluntarily or by operation of law assign all or any part of the Lease or Lessee's interest therein without the express written consent of Lessor, which consent will not be unreasonably withheld. Lessor may withhold its consent if the proposed assignee's financial standing and responsibility at the time of the proposed assignment is insufficient in the Lessor's sole and absolute discretion to give assurance of performance and compliance with all terms and conditions of this Lease and the City Agreement. Upon such an assignment and consent, Lessee shall be released from all obligations arising or occurring under this Lease after the effective date of such assignment and consent, provided that such assignee shall execute, acknowledge and deliver to Lessor an assumption agreement in form and substance satisfactory to Lessor and City, whereby assignee agrees to observe, perform and keep all the terms, provisions, covenants and conditions required to be observed, performed and kept by Lessee hereunder and under the City Agreement. Any assignment or attempted assignment of the Lease or any interest herein by Lessee without Landlord's express written consent shall be null and void. Article 10. Insurance and Indemnification. 10 01 Lessee shall indemnify and hold Lessor, its officers, employees and agents, harmless from and defend them against any and all claims or liability, including cost of defense and reasonable attorney fees, for any injury or damage to Lessee or its officers, agents or employees, or to Lessee's property, or to any third person, or to the property of any third person. (a) occurring in, on or about the Leased Premises or any part thereof, by or from any cause whatsoever except injury or damage caused solely by the wrongful or intentional acts of Lessor, its officers, employees, or agents, or (b) arising out of or resulting from the Leased Premises, or any condition thereon, or from A ft 4 Lessee's use and occupancy of the Leased Premises, or any equipment thereon or appurtenances thereto, or any activity conducted thereon. 10 02 Lessee shall secure and maintain in full force and effect, at its expense, during the effective term of this Lease, (a) commercial general liability insurance including coverage for personal injury (including death), property damage and contractual coverage in the minimum amount of $1,000,000 combined single limit naming Lessor, its officers, employees or agents as additional insureds, and (b) Colorado Workers' Compensation insurance or other similar coverage in the statutorily mandated amounts. Neither party shall be liable to the other party for any claim, loss or casualty covered by such insurance and each party waives any claim therefor against the other party whether by way of subrogation or otherwise. 10 03 A copy of each insurance policy, or certificate thereof, issued by an association or company authorized to issue such policy or policies under the laws of the State of Colorado containing a provision prohibiting cancellation or material modification of the insurance except after no less than (10) days' notice to Lessor, shall be delivered to the Lessor within thirty (30) days after the Effective Date of this Lease, and thereafter the Lessee will furnish to Lessor evidence of the continuance of the insurance coverage required herein within a reasonable time after the same has been issued. Article 11. Fire and Extended Coverage Insurance 11 01 Lessee shall, at its expense, during the Term of this Lease, secure and maintain in full force and effect "All- Risk" casualty insurance (including, without limitation, fire, extended coverage and boiler insurance) upon the Leased Premises Such insurance shall be in an amount not less than the full replacement value of the Building and improvements (without deduction for physical depreciation), and issued by an insurance company or association authorized to issue such policies under the laws of the State of Colorado and approved by Lessor, shall contain a deductible of not more than U S $25,000 00 and a standard Colorado mortgagee /landlord clause in favor of Lessor, and shall not be subject to cancellation, reduction or modification upon less than ten (10) days' written notice to Lessor Such insurance, by its terms or by endorsement, shall waive any right of subrogation of the insurer against Lessor, its officers, agents and employees, for any loss or damage resulting from covered perils. Lessee will furnish to Lessor evidence of such insurance and its continuance during the Term of this Lease 11 02 Lessee shall, at its expense, secure and maintain fire and extended coverage insurance on all fixtures, equipment and improvements installed by Lessee on the Leased Premises. Such insurance, by its terms or by endorsement, shall waive any right of subrogation of the insurer against Lessor, its officers, agents and employees, for any loss or damage resulting from covered perils. Article 12. Taxes and Assessments 12.01 Lessee shall promptly pay and discharge, as they become due and before delinquency, any and all property taxes, assessments, charges, hens, levies or excises, whether general or special or ordinary or extraordinary, of every name, nature and kind whatsoever, including all governmental 5 / `4 charges of whatsoever name, nature or kind, which may be levied, charged or imposed, or which may become a hen or charge on or against the Leased Premises or any part thereof, the leasehold interest of Lessor or Lessee herein, or the improvements situated on the Leased Premises pnor to and during the effective period of this Lease. 12 02 Lessee shall pay before delinquency any and all property taxes levied or charged against any of the personal property belonging to it and situated on the Leased Premises or used in connection with the operation and maintenance of the Building on the Leased Premises. 12 03 Lessee shall furnish Lessor within thirty (30) days after any amount is payable by Lessee under this Article 12, official receipts of the appropriate taxing authority or other proof satisfactory to Lessor evidencing such payments as are required under this Article. Article 13. Utilities Lessee shall pay, before delinquent, all charges for sewer, water, gas, electricity, telecommunications and all other utility services furnished to or used in or supplied to the Leased Premises. Lessor shall not be obligated to furnish or provide any utilities, facilities or services of any kind. Article 14. Damage to or Destruction of Premises. 14 01 If, during the Term of this Lease, the Leased Premises shall be damaged to such an extent that the repair of such damage and the restoration of the Leased Premises can be accomplished, with reasonable diligence, within one hundred eighty (180) days after such damage, Lessee shall promptly repair such damage and cause the Leased Premises to be restored to their condition prior to the event causing the damage. If, during the Term of this Lease, the Leased Premises shall be destroyed or damaged to such an extent that the repair of such destruction or damage and the restoration of the Leased Premises cannot be accomplished, with reasonable diligence, within one hundred eighty (180) days after destruction or damage, then Lessee shall promptly notify Lessor in wrrtmg of such fact within forty -five (45) days after the date of such destruction or damage, and Lessee shall thereafter have the right, during a period of thirty (30) days following such notification, to terminate this Lease by written notice to the Lessor, declaring this Lease to be terminated provided, however, that, as a condition precedent to such termination, all proceeds of insurance required to be maintained by Lessee under Article 11 01 shall be paid to Lessor, or, if Lessee fails to maintain the insurance required to be maintained by Lessee under Article 11 01, an amount equal to the insurance proceeds which would have been available but for such failure shall be paid by Lessee to Lessor Unless such notice of immediate termination shall be given within such 30 -day period and proceeds of insurance are paid to Lessor, this Lease shall continue in full force and effect and Lessee shall promptly repair such destruction or damage and cause the Leased Premises to be restored to their condition prior to the event causing the destruction or damage. In the event the Leased Premises are destroyed or damaged, or partially destroyed or damaged, the monthly rent payable by Lessee shall be abated proportionately according to the floor area of the Leased Premises which is useable by Lessee. Such abatement shall continue for the period commencing with such damage or destruction and ending when Lessee completes repair work or reconstruction, provided Lessee Aii 6 di 010 diligently commences and expeditiously completes the repair work or reconstruction. 14 02 Lessee shall make the repairs, restoration or rebuilding as expeditiously as possible in accordance with plans and specifications submitted to and approved in wnting by Lessor and in compliance with all applicable laws, regulations and codes Article 15. Eminent Domain. If the whole or substantial part of the Leased Premises shall be taken or condemned by any competent authority for any public or quasi - public use or purpose under any statute or by the right of eminent domain, or purchased under threat of such taking, then this Lease shall terminate on the date when the condemning authority takes possession of the Leased Premises or the substantial part thereof so taken. There shall be no apportionment of the award for taking or condemnation, the entire award going to Lessor, provided Lessee shall have the right to recover any award which may be made for damages to or condemnation of Lessee's movable trade fixtures, equipment, furniture and furnishings or payments for relocation, if any Article 16. Holding Over There shall be no holding over under this Lease Upon termination, Lessee shall immediately vacate the Leased Premises and immediately surrender possession thereof to Lessor Article 17. Quiet Possession. Lessee may peacefully have, hold and enjoy the Leased Premises, subject to the other terms hereof, provided that Lessee performs all of Lessee's covenants and agreements contained herein. Article 18. Default. 18 01 In the event of default at any time by Lessee in the payment of the monthly installments or rent of the performance of any of its other covenants and obligations herein contained, or, in the event Lessee defaults in its Repayment Obligation as described in the City Agreement dated January 25, 2011, and such default is not cured within thirty (30) days after wntten notice specifying the default is given by City to Company, or in the case of non - pecuniary default incapable of being cured within 30 days, not cured within ninety (90) days of such notice, provided that the cure is commenced within thirty days and diligently pursued, then, in such event, Lessor shall have the right to either (a) Terminate this Lease and reenter and take possession of the Leased Premises, and/or (b) Pursue any remedy whatsoever provided by law; and/or (c) Re -enter and take possession of the Leased Premises and use its best efforts to relet the same for and on account of Lessee for the then full remaining portion of the unexpired Term of this Lease or for any shorter period, and to collect and receive 7 4'0 payment of rent therefor, but no such re -entry or re- letting shall be construed as a termination of this Lease or as a release of Lessee from Lessee's obligation to pay monthly rent provided for in this Lease, or from Lessee's obligation to perform any other covenant herein contained. It expressly being understood and agreed that in the event of any such re -entry or re- letting by Lessor such re -entry or re- letting shall not operate to terminate this Lease or alter the obligation of Lessee to perform its covenants and to pay monthly rent pursuant to the terms hereof unless Lessor expressly so elects pursuant to paragraph 18 01(a) above Lessor shall in no way be responsible or liable for any failure to re -let the Leased Premises, or any part thereof, or for any failure to collect any rent due upon such re- letting. No notice from lessor hereunder or under a forcible entry and detainer statute or similar law constitutes an election by Lessor to terminate this Lease unless such notice specifically so states Lessor reserves the right following any such re- entry and/or reletting to exercise its right to terminate this Lease, and/or (d) Cure the default on Lessee's behalf and at Lessee's expense, in which event, all costs, expenses and reasonable attorney's fees incurred by Lessor in curing the default together with interest thereon at the rate of ten (10) percent per annum shall constitute additional rent payable to Lessor by Lessee upon demand. 18 02 If Lessor does not elect to terminate this Lease but takes possession as provided for in Article 18 01(c), Lessee shall pay to Lessor the monthly rent and other charges at the times and in the manner as herein provided which would be payable if such repossession had not occurred, less the net proceeds, if any, of any re- letting of the Leased Premises after deducting all Lessor's reasonable expenses including, without limitation, all repossession costs, brokerage commissions, legal expenses, attorneys' fees, alteration and repair costs and expenses of preparation for such re- letting. 18 03 In the event the parties hereto become involved in a dispute arising out of this Lease, or the performance or breach thereof, the Court shall award costs, expenses, and attorney fees to the prevailing party 18 04 If Lessee violates any of the terms and provisions of this Lease or defaults in any of its obligations hereunder other than the payment of monthly rent or other sum payable hereunder, such violation may be restrained or such obligation enforced by injunction at the instance and request of Lessor without the showing of any special damages or an inadequate remedy at law Article 19. Waiver and Time of Essence No waiver of any breach or breaches of any provision, covenant or condition of this Lease shall be construed to be a waiver of any preceding or succeeding breach of such provision, covenant or condition, or of any other provision, covenant or condition. Acceptance of monthly rent or partial monthly rent by Lessor shall not constitute a waiver of any then existing or subsequent breach or default. Time is of the essence for each and every provision, covenant and condition herein contained and on the part of Lessee to be done and performed. 8 01 G,/ Article 20. Notices All notices, demands or communications of any kind which may be required or desired to be served, given or made by Lessee upon or to Lessor, under the terms of or in connection with this Lease, shall be sufficiently served, given or made (as an alternative to personal service upon Lessor) if such notice, demand or communication is sent by certified United States mail, addressed to City Manager City of Pueblo 1 City Hall Place Pueblo, Colorado 81003 and to City Attorney Pueblo Law Department 503 N Main Street, Suite 203 Pueblo, Colorado 81003 (or to such other person or address as may hereafter from time to time be designated for this purpose by Lessor to Lessee in writing) All notices, demands or communications of any kind which maybe required or desired to be served, given or made by Lessor upon or to Lessee, under the terms of or in connection with this Lease, shall be sufficiently served, given or made (as an alternative to personal service upon Lessee) if such notice, demand or communication is sent by certified United States mail, addressed to FRE Composites USA Inc 75 Wales street S aint- Andre -d' Arg ent eui l Quebec, Canada JOV 1X0 Attention. Benoit Arsenault (or to such other person or address as may hereafter from time to time be designated for this purpose by Lessee to Lessor in writing) Article 21. Environmental Provisions 21 01 For the purpose of this Lease, "Hazardous Materials" means any hazardous or toxic substance, material or waste which is or becomes regulated by any local government authority, the State of Colorado or the United States government and shall include, but not be limited to (1) substances defined as "hazardous waste ", "restricted hazardous waste ", "hazardous substance" or "hazardous material" under any applicable federal, state or local law or regulation ( "Environmental Regulations "), (2) asbestos - containing materials, (3) PCBs, (4) petroleum or petroleum based products, and (5) lead. 21 02 Lessee will comply with Environmental Regulations that are applicable to the Lessee 9 �0111, and its use of the Leased Premises No activity shall be undertaken by the Lessee, its employees, agents, licensees, invitees, contractors or subcontractors, on all or any portion of the Leased Premises which would cause or permit: (i) the presence, use, generation, release, discharge, storage or disposal of any Hazardous Material in, on, under, about, or from the Leased Premises or any part thereof in violation of any Environmental Regulations, (n) any portion of the Leased Premises to become a hazardous waste treatment, storage or disposal facility without receiving proper governmental authorization, and in compliance with all Environmental Regulations, or (iii) the discharge of pollutants or effluents into any water source or system, or the discharge into the air of any emissions without receiving proper governmental authorization, and in compliance with all Environmental Regulations, including, without limitation, the Federal Water Pollution Control Act, U S C Section 1251 et seq. and the Clean Air Act, 42 U S C Section 7401 et seq. 21 03 Lessee agrees to defend, indemnify and forever hold harmless the Leased Premises and Lessor, and its officers, employees, agents, successors, and assigns, as their interest may appear, from all claims, losses, damages, penalties, expenses and costs, including, but not limited to, attorneys' fees, characterization, remediation and cleanup costs, incurred by reason of the use, storage, generation, release, discharge, maintenance, disposal, or removal of Hazardous Matenals in, on, under, about, or from the Leased Premises, or any part thereof, by Lessee, its employees, agents, licensees, invitees, contractors and subcontractors The provisions of this Article 21 and Article 10 01 shall expressly survive the expiration of the Term or other termination of this Lease. Article 22. Option to Purchase Leased Premises 22 01 If Lessee is not in default hereunder or under the City Agreement, and has maintained its Employment Commitment under the City Agreement by employing thirty (30) Full -Time employees at the Leased Premises, Lessee shall have the option to purchase the Leased Premises upon the terms and conditions contained in this Article for a purchase price as follows (a) the option may be exercised dunng the last thirty-six (36) months of the Term, by Lessee giving written notice thereof to the Lessor, and (b) the purchase price shall be a lump sum equal to the amount of the remaining monthly installments of rent through the end of the Term, by way of example, if Lessee gives notice to exercise the option with 36 months of the lease remaining, the purchase price shall be U S $178,714 08 ( $4964.28 times 36 = $178,714 08) 22 02 If Lessee fails for any reason to give timely notice of its exercise of the option to purchase, the option rights granted hereby shall automatically terminate 22 03 Upon valid exercise of the purchase option, the terms of purchase and sale shall include the following conditions and requirements (a) Closing and payment of the purchase price to be held and made not later than ninety (90) days after date of Lessee's written notice to exercise the option, (b) Conveyance shall be made by special warranty deed free of hens and 10 ��I encumbrances, except those for general property taxes and those created by acts or defaults of Lessee, and subject to the Easements and easements, rights -of -way, conditions, covenants, restrictions, reservations, and limitations of record and those created by acts of defaults of Lessee. (c) The Leased Premises shall be conveyed and transferred in their condition at the time of sale "AS IS" and "WHERE IS" without any representation or warranty with respect to the Leased Premises, including without limitation, the quantity, quality or condition of the Leased Premises, environmentally or otherwise Prior to closing and payment of the purchase price, Lessee may at Lessee's expense, conduct such inspection of the Leased Premises as it deems prudent, and may rescind its exercise of the purchase option if it finds objectionable any condition of the premises not caused by Lessee Article 23. Miscellaneous Provisions. 23 01 Colorado Law This Lease shall be governed by the laws of the State of Colorado and shall be construed in accordance therewith without reference to such State's choice of law and/or conflict of law principles 23 02 Writing for Waiver or Modification. No provision of this Lease may be waived or modified except by an agreement in writing signed by the waiving party A waiver of any term or provision shall not be construed as a waiver of any other term or provision. 23 03 Binding Effect. This Lease sets forth the entire and complete understanding and agreement of the parties hereto with respect to the subject matter hereof. Lessee acknowledges and agrees that it has not relied upon any statements, representations, agreements or warranties of Lessor except such as are expressed herein. This Lease shall be binding on the parties, their successors and approved assigns. 23 04 Construction. Throughout this Lease, the singular shall include the plural, the plural shall include the singular; and the masculine and neuter shall include the feminine, wherever the context so requires. 23 05 Text to Control. The headings of sections are included solely for convenience of reference If any conflict between any heading and the text of this Lease exists, the text shall control. 23 06 Severabihty If any provisions of this Lease is declared by any court of competent jurisdiction to be invalid for any reason, such invalidity shall not effect the remaining provisions. On the contrary, such remaining provisions shall be fully severable, and this Lease shall be construed and enforced as if such invalid provisions had never been inserted in the Lease 23 07 Venue and Jury Trial. Lessor and Lessee agree that exclusive venue for all actions or causes of action relating to this Lease or the Leased Premises shall be Pueblo County, Colorado All such actions shall be filed in the District Court in and for the County of Pueblo, State of Colorado and Lessor and Lessee submit to the jurisdiction of that Court. To the extent allowed by law, each party waives its right to a jury trial 11 or 23 08 Lessee's Warranties. The persons signing this Lease on behalf of Lessee represent and warrant that such persons and Lessee have the requisite power and authority to enter into, execute and deliver this Lease and that this Lease is a valid, legally binding obligation of Lessee enforceable against Lessee in accordance with its terms. 23 09 Time of Essence. Time shall be and is of the essence as to the performance of all terms, conditions and obligations under this Lease. 23 10 Third Parties. The provisions of this Lease are and will be for the benefit of Lessor and Lessee only and not for the benefit of any third party, and accordingly, no third party shall have any right or remedy hereunder or the right to enforce any provision of this Lease IN WITNESS WHEREOF, Lessor and Lessee, by their duly authonzed representatives, have executed this Lease on the day and year first above written. PUEBLO, A MUNICIPAL CORPORATION FRE COMPO'ITES US • I► a Delaware r•a.:,.n By By AO President of t e City Council Name B - oit Arsenault Title President Attest: [SEAL ] City lerk 12 Rev 11/12/10 CONTRACT TO BUY AND SELL REAL ESTATE THIS CONTRACT TO BUY AND SELL REAL ESTATE ( "Contract ") is made and entered into as of /1— /, , 2010 (the "Effective Date ") by and between Greenhorn Drive, LLC, a Colorado limited liability company (the "Seller ") and the City of Pueblo, a municipal corporation (the "Buyer "). Buyer and Seller are sometimes referred to herein as a "Party" and, collectively, as the "Parties." Recitals A. Seller is the owner of approximately 5 41 acres of real property with improvements consisting principally of a warehouse/ manufacturing facility with offices located within Pueblo County, Colorado, and more particularly described as. Lots 9 and 10, Minnequa Industrial Park, First Filing, County of Pueblo, State of Colorado ( the "Property"). Seller desires to sell the Property B Buyer is desirous of purchasing the Property from Seller upon the terms set forth hereinafter C. Seller is willing to sell, and partially make a gift of, the Property to Buyer upon the terms and conditions hereinafter set forth. Agreement NOW, THEREFORE, in consideration of the foregoing Recitals and the mutual covenants contained herein, Seller and Buyer agree as follows. 1 Sale and Purchase. Seller agrees to sell and Buyer agrees to purchase the Property, together with all tenements, hereditaments, appurtenances, interests, rights, benefits, easements and improvements thereunto belong or appertaining, all of which are and shall constitute part of the Property as defined herein, on the terms and conditions set forth in this Contract. 2. Value, Purchase Price and Terms. The value of the Property is $825,000. The purchase price shall be $750,000. payable as follows: (a) $10.00 as Earnest Money payable upon execution hereof; (b) $749,990.00 payable on Closing Date (as defined in Paragraph 5 below); All amounts paid by Buyer shall be cash, electronic transfer funds, certified check, or cashier's check. The difference between:the value of the Property and the Purchase Price shall b e and constitute a donation: to Buyer as an IRC: § 170(c) qualified. organization. 1 The Earnest Money shall be credited against the Purchase Price at Closing, provided, that if the sale and purchase contemplated herein does not close for any reason other than a default by Buyer hereunder, the Earnest Money shall be returned by Seller to Buyer free and clear from any and all claims Seller may have. 3 Evidence of Title. (a) Title Commitment and Policy Within twenty (20) days after Seller's receipt of the Survey, Seller shall order and obtain, at Seller's expense, a current commitment for extended coverage title insurance in the amount of the Purchase Price, together with legible copies of all documents listed as exceptions therein, and a current certificate of taxes due with respect to the Property, from a title company selected by Seller authorized to issue title insurance in the state of Colorado (the "Title Company "), on the current standard form of extended ALTA Owners Policy (collectively, the "Title Commitment "). The Title Company shall promptly provide copies of any amendments or modifications of the Title Commitment to Buyer At Closing or as soon as reasonably practicable after Closing, the Title Company shall issue and deliver to Buyer the owner's title insurance policy referred to above (the "Title Policy "), issued by the Title Company insuring Buyer's title to the Property consistent with the Title Commitment, providing "gap" coverage, deleting the standard exceptions, endorsing over arbitration and creditors' nghts exceptions, if necessary, and subject only to taxes and assessments for the year of Closing and subsequent years, and the other matters approved by Buyer in accordance with subparagraph (c) below and any encumbrances upon the Property caused by Buyer (the "Permitted Exceptions "). At Closing, Seller shall pay the premium for the Title Policy Buyer may obtain such other endorsements to the Title Policy as Buyer desires, at the expense of Buyer, except for endorsements obtained at Seller's cost, as provided in subparagraph (b) below Seller shall provide such affidavits or certificates as may be required by the Title Company to remove all liens, including, without limitation, mechanics' or materialmen's liens, as exceptions to the Title Policy (b) Survey Within twenty (20) days of the Effective Date, Seller shall obtain and deliver, at Seller's expense, to the Title Company, a boundary and improvements survey plat containmg the description of the Property and location of all improvements and encroachments thereon, including but not limited to any improvements, fence locations and easements (whether visible or recorded), rights of way (whether visible or recorded) and roadways adjacent to the Property, in a form sufficient to enable the Title Company to issue the Title Policy in compliance with this Paragraph 3, certified to Buyer, Seller, and the Title Company (the "Survey "). (c) Title Defects and Objections. Buyer will have twenty (20) days from the date of receipt of the Title Commitment and Survey, whichever shall last occur, to notify Seller in writing of any objections to any items identified in the Title Commitment or on the Survey, or of any other objections as to title matters. Seller will have until fifteen (15) days after receipt of Buyer's written objections ( "Seller's Cure Period ") to elect, at its reasonable discretion, to cure all items to which Buyer has objected, cause such items to be modified in a manner which is reasonably satisfactory to Buyer or to advise Buyer that Seller does not intend to cure such items. Alternatively, within the Seller's Cure Period, Seller at Seller's cost may elect to obtain one or more endorsements to the Title 2 W)1/4 Commitment, in a form reasonably acceptable to Buyer, providing title insurance protection with regard to any objections raised by Buyer If Seller fails to cure to the satisfaction of Buyer any written objection by Buyer of which Seller has been given notice in accordance with this subparagraph (c), or elects not to cure, then Buyer may elect, as its sole remedy to either (i) waive the objection by written notice to Seller within ten (10) days after expiration of Seller's Cure Period and proceed to Closing as herein provided, or (ii) terminate this Contract by wntten notice to Seller, in which case the Earnest Money will be promptly returned to Buyer and the Parties will be released from all obligations hereunder, except for any obligations that expressly survive the termination of this Contract. Buyer will have ten (10) business days after receipt of any amendment or update to the Title Commitment or Survey to object to any changes in the same fashion as objections to the initial Title Commitment or Survey under this subparagraph (c). Anything above to the contrary notwithstanding, Seller shall be obligated to, and shall cause all financing, mortgage, judgment and tax liens to be removed as title exceptions prior to or concurrently with Closing. 4 Inspection. Commencing on the Effective Date and continuing during the term of this Contract until the first to occur of the Closing Date or termination of this Contract, Buyer, its agents, consultants and employees, shall have the right to enter and access the Property at reasonable times for the purpose of making such inspections, studies, tests and investigations ( "Testing ") as Buyer may elect and which it deems necessary to determine the suitability of the Property for Buyer's intended use. All such Testing shall be performed by Buyer or its agents or employees at Buyer's sole cost and expense. Buyer shall keep all Testing results confidential and shall deliver copies of all Testing results to Seller Buyer shall indemnify, defend and hold Seller and the Property harmless from and against any and all direct costs, liabilities, claims, demands, actions and expenses arising from or m connection with such Testing and, in the event Buyer does not close on the purchase of the Property, Buyer shall repair any damage to the Property or improvements thereon caused by such Testing. This indemnification shall not be deemed to apply to costs, liabilities, claims, demands, actions or expenses arising from Seller's negligent acts or omissions or any pre- existing condition (including, without limitation, environmental conditions) within the Property If Buyer is not satisfied with the physical condition of the Property, Buyer may terminate this Contract by written notice given to Seller at least five (5) days prior to Closing Date. 5 Date of Closing. The closing of Buyer's purchase of the Property ( "Closing ") shall take place on or before December 31, 2010 The date of Closing ( "Closing Date ") and the hour and place of Closing shall be mutually agreed upon by the Parties, but in no event later than December 31, 2010. 6. Transfer of Title. Subject to payment of the Purchase Price, compliance by Buyer with the other terms and provisions hereof, and the occurrence or waiver by Buyer of the Conditions Precedent to Closing defined and described in Paragraph 7, Seller shall execute and deliver to Buyer at Closing a General Warranty Deed conveying marketable fee simple title to the Property to Buyer free of financing, mortgage, judgment and tax liens, subject only to the Permitted Exceptions. 7 Additional Conditions Precedent to Closing. The sale and purchase contemplated by this Contract is contingent upon occurrence of all of the following prior to Closing Date (collectively, the "Conditions Precedent to Closing "): 3 --ro° (a) City Council of Buyer, as its governing body, approving this Contract on or before Closing. (b) Funds for the payment of the Purchase Price have been duly appropriated by Buyer's governing body in accordance with law and a sufficient unencumbered balance thereof exists sufficient for payment of the Purchase Price stated above. (c) The industrial prospect Buyer is seeking to occupy the Property finally determines and commits to locate its facilities on the Property, and a definitive agreement is entered into by Buyer with same and is approved by Buyer's governing body The code name for the prospect assigned by the Pueblo Economic Development Corporation is "Maple Leaf" (d) The results of inspection and testing do not indicate any conditions which are deemed unacceptable to Buyer, in Buyer's sole and absolute discretion. In the event any of the Conditions Precedent to Closing are not satisfied on or before ten (10) days before the Closing Date, Buyer may by notice given to Seller not less than least five (5) days prior to Closing Date (i) waive any or all of the above conditions in writing delivered to Seller and close the sale and purchase of the Property, or (ii) elect to terminate this Contract, in which event the Earnest Money shall be returned to Buyer and each party will be released from all obligations under this Contract. 8. Closing Costs, Documents and Services. Buyer and Seller shall sign and complete all customary or required documents at or before Closing. At Closing,. Buyer shall provide an <IRS form 8283 signed by its appraiser ands -a representative -of Buyer Fees for real estate closing services, if any, shall be paid at Closing, one -half by Buyer and one -half by Seller 9 Proration. General taxes and assessments for the year of Closing, if any (which shall be based on the taxes for the calendar year immediately preceding Closing), water, sewer, utility charges and other usual and customary items shall be prorated between Seller and Buyer as of the Closing Date. 10 Possession. Possession of the Property shall be delivered to Buyer by Seller on Closing Date. 11 Time of Essence/Default and Remedies. Time is of the essence hereof. If any obligation is not performed there shall be the following remedies: (a) If Buyer is in Default: In the event Buyer defaults in the performance of its obligations hereunder, Seller's sole remedy shall be to terminate this Contract and retain the entire amount of the Earnest Money as liquidated damages and in lieu of all other remedies it may pursue, and Seller shall have no right to damages. 4 (b) If Seller is in Default: In the event Seller defaults in the performance of its obligations hereunder, Buyer shall have the right to (i) terminate this Contract by written notice to Seller and obtain the return of the Earnest Money, or (ii) treat this Contract as being in full force and effect and to obtain specific performance, but not any damages. (c) Costs and Attorneys' Fees. Anything to the contrary herein notwithstanding, in the event of any action or litigation arising out of this Contract, the court shall award to the prevailing party all reasonable costs and expenses, including reasonable attorneys' fees. Exclusive venue and jurisdiction for any such litigation shall be in the District Court in and for Pueblo County, Colorado. The provisions of this subparagraph (c) shall survive Closing or termination of this Contract. 12. Representations and Warranties of Seller The Seller represents and warrants to Buyer as follows. (a) Seller has full power, capacity and authority to execute and deliver this Contract and all other documents required to be executed and delivered by Seller under this Contract and to perform its obligations hereunder (b) This Contract has been, duly authorized, executed and delivered by Seller and constitutes the legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms. (c) Seller is not a party to any judicial, administrative, arbitration or other similar proceedings relating in any manner to the Property or to Seller's interest therein or that may detrimentally affect Seller's ability to perform its obligations under this Contract or the ability of persons who acquire portions of the Property to develop, own or operate the Property Seller has not received notice of (and to Seller's knowledge there is no basis for) any pending or threatened claims, actions, suits or other proceedings of the nature described in the immediately preceding sentence, nor are any such claims, actions, suits or other proceedings contemplated by Seller (d) To Seller's knowledge, there are no violations of laws, rules, regulations, ordinances, codes, covenants, conditions, restrictions, instructions or agreements applicable to the Property Seller has not received notice from any governmental or other agency or any other person with respect to any such violations concerning the Property (e) There are no contracts or other obligations outstanding for the sale, lease or transfer of all or any part of the Property (0 None of the Property is included in the U.S Department of Agriculture Conservation Reserve Program. (g) There is no default, nor has any event occurred which, with the passage of time, the giving of notice or both, would constitute a default under any agreement, contract, 5 mortgage, deed of trust or other instrument which relates to Seller or the Property or which affects the Property in any manner (h) To Seller's knowledge (i) the Property is and at all time has been in compliance with all applicable state and federal environmental laws, regulations, ordinances, rules and orders (collectively, "Environmental Laws "); (ii) there are no pending or threatened judicial or administrative proceedings of any kind with respect to the Property alleging the violation or potential violation of any Environmental Law nor are there any pending or threatened investigations of any matters relating to any Environmental Laws with respect to the Property; (iii) there has been no release or threatened release of any hazardous, toxic or otherwise regulated substance, waste, contaminant or material (collectively "Hazardous Materials "), as such terms are defined in any applicable Environmental Law, on, in or at the Property, or any part thereof; (iv) no portion of the Property or any adjacent property has been used as a dump site, a storage site for solid wastes or the location of above ground or underground fuel or storage tanks; and (v) no Hazardous Materials are currently present on or have at any time been stored or used on the Property, except for fertilizers and pesticides used in strict accordance with package instructions and all applicable Environmental Laws. Seller shall indemnify and hold Buyer harmless and defend Buyer from any loss, liability or expense, including reasonable attorneys' fees, incurred by Buyer, or any claim made against Buyer, by reason of Seller's breach of any of the foregoing representations or warranties. The provisions of this Paragraph 12 shall survive closing. 13 Representations and Warranties of Buyer Buyer represents, warrants and covenants as follows. (a) Buyer has full power, capacity and authority to execute and deliver this Contract and all other documents required to be executed and delivered by Buyer under this Contract and to perform its obligations hereunder (b) Subject to approval by Buyer's City Council, this Contract will have been duly authorized, executed and delivered by Buyer and constitutes the legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms. 14 Seller Covenants. Commencing on the Effective Date and until the first to occur of Closing or termination of this Contract, Seller shall not (a) lease, sell, convey or further encumber any portion of the Property, (b) consent to any zoning or other change affecting the use of the Property, except for those requested or approved by Buyer, or (c) cause any other changes which affect the condition of Seller's title to the Property or otherwise adversely impact the condition of the Property or Buyer's intended use thereof. 15 Notices. Any notice required or permitted to be given or delivered under this Contract shall be in writing and shall be given by personal delivery, or by the United States Postal Service, by registered or certified mail, postage prepaid, or reputable national overnight courier 6 "frA)k) service. (a) If to Seller, addressed to City Manager City of Pueblo 1 City Hall Place Pueblo, Colorado 81003 Telephone No (719)553 -2655 with a copy to Thomas J Florczak City Attorney 503 N Main, Suite 203 Pueblo, Colorado 81003 Telephone No. (719) 562 -3899 (b) If to Buyer, addressed to Greenhorn Drive, LLC or to such other address or person as any party may from time to time specify in a writing delivered to the other party in the manner provided in this paragraph. Any notice shall be deemed delivered on the day on which personal delivery is effected or three (3) days after deposit in the mail in the case of registered or certified mail, and one (1) business day in the case of overnight courier 16 Assignment. This Contract and the rights granted to Buyer hereunder may be assigned by Buyer with Seller's consent, provided, such consent shall not be unreasonably withheld, conditioned or delayed. Except as so restricted, this Contract shall inure to the benefit of and be binding upon the Parties and their respective successors and assigns. 17 Modification. No subsequent modification of any of the terms of this Contract shall be valid or binding upon the Parties or enforceable unless made in writing and signed by the Parties. 18 Entire Contract. This Contract constitutes the entire contract and agreement between the Parties relating to the subject matter hereof, and any prior statements, representations or agreements pertaining thereto, whether oral or written, have been merged and integrated into this Contract. 19 Captions. The captions in this Contract are inserted for convenience of reference only and in no way define, describe or limit the scope or intent of this Contract or any of the provisions hereof 7 ��W • 20 Validity If any provision of this Contract shall be held to be invalid or unenforceable, the same shall not affect in any respect whatsoever the validity or enforceability of the remainder of this Contract. 21 Broker (a) Except as stated in Paragraph 21(b), Buyer and Seller represent and warrant to the other than no broker or finder has been engaged by such Party in connection with this transaction. Seller agrees to indemnify, defend and hold Buyer harmless from and against any and all claims, loss, liability, costs and expenses (including reasonable attorneys' fees), resulting from any claims that may be made against Buyer by any broker or other person claiming a commission, fee or other compensation by reason of the transaction contemplated hereby if the same shall arise by, through or on account of Seller Buyer agrees to indemnify, defend and hold Seller harmless from and against any and all claims, loss, liability, costs and expenses (including reasonable attorneys' fees), resulting from any claims that may be made against Seller by any broker (other than Broker) or other person claiming a commission, fee or other compensation by reason of the transaction contemplated hereby if the same shall arise by, through or on account of Buyer (b) Seller has an agreement with JONES - HEALY, INC as Broker for sale of the Property, and shall be solely responsible for payment of any compensation due or payable thereunder, if any, to Broker arising from this Contract to Buy and Sell Real Estate. 22. Applicable Law This Contract will be construed and enforced in accordance with the laws of the State of Colorado (without giving effect to its choice of law principles). 23 Interpretation. Whenever the context so requires, the singular number shall include the plural and the plural the singular, and the use of any gender shall include all genders. 24 Survival of Representations. The representations, warranties, covenants and agreements of Buyer and Seller in this Contract are and shall be construed to be covenants running with the Property, shall survive the Closing of the transaction contemplated hereby and recordation of the General Warranty Deed, may be enforced by either Buyer or Seller after Closing Date, and shall not be merged or be deemed to be merged into the General Warranty Deed. 25 Third Parties. Buyer and Seller and their respective successors and permitted assigns are the only parties to this Contract and are the only parties entitled to enforce this Contract. Nothing contained in this Contract nor any provision hereof is intended to give or shall be construed to give or confer, directly or indirectly, or otherwise, upon any third party any right, remedy or benefit hereunder 26 Counterparts and Facsimile Signatures. This Contract may be executed in multiple counterparts, which taken together shall be deemed one original. 27 Exclusivity In consideration of the time and resources which the Buyer will devote to the transactions contemplated herein, Seller agrees that until Closing or the earlier termination of this Contract, Seller will not, directly or indirectly, solicit, initiate or enter into discussions or transactions with, or encourage, or provide any information to, any individual, entity or group (other 8 than to Buyer and Buyer's designees) concerning any sale or lease of the Property or any similar transaction or alternative. The provisions of this Paragraph shall not be construed to prohibit Seller or Buyer from discussing the transaction contemplated herein with their attorneys or other consultants. IN WITNESS WHEREOF, the parties have signed this Contract as of / / , 2010, effective as of the Effective Date. BUYER. SELLER. CITY OF PUEBLO, GREENHORN DRIVE,LLC, A MUNICIPAL CORPORATION A COLORADO LIMITED LIABILITY COMPANY i By L it ... _ _ B , �i & President e the fi'ty Council Name. Title: Manager / Member Attest: \J j City rk Approved as to form. City Attorne , 9 ADDENDUM NO. 1 TO CONTRACT TO BUY AND SELL REAL ESTATE THIS ADDENDUM NO 1 ( "Addendum ") is made tlus 24 day of January, 2011 to that certain Contract to Buy and Sell Real Estate between Greenhorn Drive, LLC ( "Seller ") and the City of Pueblo, a Municipal Corporation ( "Buyer ") dated November 15, 2010 (the "Contract "). The Contract is hereby amended as follows. A. Section 5 of the Contract is amended to read as follows. 5 Date of Closing. The closing of Buyer's purchase of the Property ( "Closing ") shall take place on or before January 31, 2011 The date of Closing shall be mutually agreed upon by the Parties, but in no event later than January 31, 2011 B Section 6 of the Contract is amended to read as follows. 6. Transfer of Title. Subject to payment of the Purchase Price, compliance by Buyer with the other terms and provisions hereof, and the occurrence or waiver by Buyer of the Conditions Precedent to Closing defined and described in Paragraph 7, Seller shall execute and deliver to Buyer at Closing a General Warranty Deed dated January 1, 2011 conveying marketable fee simply title to the Property to Buyer free of financing, mortgage, judgment and tax hens, subject only to the Permitted Exceptions. C Section 9 of the Contract is amended to read as follows 9 Prorations. General taxes and assessments for the year of Closing, if any (which shall be based on the taxes for the calendar year immediately preceding Closing), water, sewer, utility charges and other usual and customary items shall be prorated between Seller and Buyer as of January 1, 2011 D As modified by this Addendum, the Contract shall remain m full force and effect according to its terms. BUYER. SELLER. City of Pu blo, a Municipal Corporation Greenh Drive, LLC B U) hI By y President of th City Council Name. Tom W Watt Title Manager/ Member Attest: City jerk Approved as to form. City Attorney-1 1865886 WD 02/01/2011 11 35 13 AM 6g 1 0 Gilbert O Clerk/Recorder Pueblo l Cou 0 nty Co III !Pi Pal ilir'iIgi Ieliti 'IA RAE PRIM' iiM'll NI 111 1111 1111 111 1 I1 1111 1 1 1111 1 01 III State Documentary Fee Warranty Deed Date: January 01, 2011 $ 0.00 (Pursuant to 38-30 -113 C.R.S.) THIS DEED made on January 01, 2011 by GREENHORN DRIVE LLC, A COLORADO LIMITED LIABILITY COMPANY Grantor(s), of the County of and State of COLORADO for the consideration of ($825,000.00) * ** Eight Hundred Twenty Five Thousand and 00 /100 * ** dollars in hand paid, hereby sells and conveys to CITY OF PUEBLO, A MUNICIPAL CORPORATION Grantee(s), whose street address is 1 CITY HALL PLACE PUEBLO, CO 81003, County of PUEBLO and State of COLORADO, the following real property in the County of Pueblo, and State of Colorado, to wit: LOTS 9 AND 10, MINNEQUA INDUSTRIAL PARK, FIRST FILING, COUNTY OF PUEBLO, STATE OF COLORADO also known by street and number as: 60 GREENHORN DRIVE PUEBLO CO 81004 with all its appurtenances and warrants the title to the same, subject to general taxes for the year 2011 and those specific Exceptions described by reference to recorded documents as reflected in the Tide Documents accepted by Grantee(s) in accordance with Section 8.1 (Title Review) of the Contract to Buy and Sell Real Estate relating to the above described real property• distribution utility easements, (including cable TV), those specifically described rights of third parties not shown by the public records of which Grantee(s) has actual knowledge and which were accepted by Grantee(s) in accordance with Section 8.2 (Matters not Shown by the Public Records) and .Section 8.3 (Survey Review) of the Contract to Buy and Sell Real Estate relating to the above described real property; inclusions of the Property within any special tax district; and other NONE GREENHORN DRIVE LLC, A COLORADO LIMITED LIABILITY COMPANY By: LOW VOLT GE HOLDING C PANY LL • COLO' ' 10 LIMITED LIABILITY COMPANY , d 1 % THOMAS W WATT MANAGER/MEMBER OF LOW 'OLTAGE HOLDING COMPANY LLC, A COLORADO LIMITED LIABILITY COMPANY AS MEMBER State of ARIZONA ) ) ss. County of MARICOPA ) The foregoing instrument was acknowledged before me on this day of January 01, 2011 by THOMAS W WATT, MANAGER/MEMBER OF LOW VOLTAGE HOLDING COMPANY, LLC AS MEMBER OF GREENHORN DRIVE LLC, A C LORADO LIMITED LIABILITY COMPANY .F Swan R. Fowler A ■ Notary Public Arizona C,.'C.�44...10-7 , , , } llatkopa County Notary Public ! September /8, 20 `` My commission expires September 19 , 2 013 When Recorded Return to: CITY OF PUEBLO, A MUNICIPAL CORPORATION 1 CITY HALL PLACE PUEBLO, CO 81003 Land Tide Form 13084 01/2011 wd.odt Warranty Deed (Photographic) PBC35026214 {10974195}