HomeMy WebLinkAbout05651ORDINANCE NO. 5651
AN ORDINANCE APPROVING AN AGREEMENT BETWEEN
PUEBLO, A MUNICIPAL CORPORATION, THE BOARD OF
COUNTY COMMISSIONERS OF PUEBLO COUNTY, COLORADO,
AND KAISER AEROSPACE & ELECTRONICS CORPORATION
RELATING TO THE LOCATION AND CONSTRUCTION OF A
MANUFACTURING FACILITY WITHIN THE CITY OF PUEBLO
AND THE EMPLOYMENT OF SPECIFIED NUMBERS OF
EMPLOYEES THEREAT; AUTHORIZING THE PRESIDENT OF
THE CITY COUNCIL TO EXECUTE SAID AGREEMENT;
DETERMINING AND FINDING THAT ENTERING INTO THE
AGREEMENT, THE CITY'S EXPENDITURE OF APPROXI-
MATELY $5,000,000.00 OF PUBLIC FUNDS, AND THE
PAYMENT OF PUBLIC FUNDS TO KAISER AEROSPACE &
ELECTRONICS CORPORATION ARE PUBLIC PURPOSES AND
PROMOTE THE HEALTH, SAFETY AND GENERAL WELFARE
OF THE CITY AND ITS INHABITANTS; APPROVING ALL
ACTIONS HERETOFORE TAKEN IN FURTHERANCE OF THE
ORDINANCE AND THE AGREEMENT; AND REPEALING ALL
ORDINANCES AND RESOLUTIONS INCONSISTENT
THEREWITH
WHEREAS, there exists and has existed within the City
unemployment, underemployment and a lack of available employment
opportunities which places a public burden upon the City and its
citizens, and
WHEREAS, it is in the best interest of the City to encourage
economic development which creates employment opportunities and
jobs for its citizens, and to appropriate public funds for
purposes of stimulating investment and inducing industry to locate
within the City, and
WHEREAS, the prevention and reduction of unemployment and
underemployment and the social and economic hardships associated
therewith are proper public purposes and matters of local and
municipal concern which justify the expenditure of public funds,
and
WHEREAS, Kaiser has represented it will construct and equip
an approximately 135,000 square foot manufacturing building (the
"Facility ") for the production of advanced cockpit display
systems, airborne computers and associated equipment on an
approximately 24.23 acre tract of land located within the City and
use its best efforts in good faith to employ 450 persons at the
Facility within three years after the issuance of a certificate of
occupancy for the Facility, and
WHEREAS, Kaiser has further represented that it will make a
final determination whether to expand the Facility within five
years after issuance of a certificate of occupancy for the
Facility, and, if Kaiser makes a final determination to expand the
Facility, Kaiser will thereafter use its best efforts in good
faith to employ a total of 1100 persons at the expanded facility
within a reasonable time after its construction.
WHEREAS, as part of the economic incentives and inducements
to Kaiser Aerospace & Electronics Corporation to construct and
locate the Facility within the City, the City and the County of
Pueblo have committed to appropriate and pay the sum of
$6,000,000.00 ($4,000,000.00 by the City and $2,000,000.00 by the
County) to Kaiser Aerospace & Electronics Corporation to be used
for any purpose on the Facility including operating expenses but
excluding capital costs for constructing and equipping the
Facility, and
WHEREAS, City has committed to acquire and transfer to Kaiser
Aerospace & Electronics Corporation 24.23 acres of land upon which
the Facility is to be constructed and to extend all roads, sewer,
water and other utilities to the land at an additional expense to
the City in the approximate amount of $1,000,000.00, and
WHEREAS, the City's payment of public funds to Kaiser in the
sum of $4,000,000.00 and the expenditure of additional public
funds in the approximate amount of $1,000,000.00 to acquire and
develop the land are proper public purposes and matters of local
and municipal concern; NOW, THEREFORE,
BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The City Council does hereby find and determine:
(a) There exists and has existed within the City unemploy-
ment, underemployment and economic distress injurious to the
public health, morales, safety and welfare of the City which
places a public burden upon the City and its citizens.
(b) Such unemployment, underemployment and economic distress
constitutes an economic and social liability and substantially
arrests the sound growth and economic stability of the City.
(c) The prevention and elimination of unemployment and
underemployment and the economic evils associated therewith are
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proper public purposes and matters of local and municipal concern
which justify the expenditure of public funds.
(d) It is in the best interests of the City to encourage
economic development which creates employment opportunities and
jobs for its citizens and to appropriate public funds for purposes
of stimulating investment and inducing industry to locate within
the City.
(e) The location and construction of manufacturing
facilities and creation of employment opportunities within the
City and specifically the project proposed by Kaiser Aerospace &
Electronics Corporation as described in the Agreement dated
November 26, 1990, attached to and incorporated herein, will
promote the public health, safety, commerce, prosperity and
welfare of the City and its citizens.
(f) The City's expenditure of public funds in the approxi-
mate sum of $5,000,000.00 for the purpose of inducing Kaiser
Aerospace & Electronics Corporation to locate its facility within
the City is a proper public purpose and matter of local and
municipal concern for which public funds may be appropriated and
expended.
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The Agreement dated November 26, 1990 between Pueblo, a
Municipal Corporation, the Board of County Commissioners of Pueblo
County, Colorado and Kaiser Aerospace & Electronics Corporation
relating to the location and construction of a manufacturing
facility and the employment of persons as specified therein, a
copy of which is attached hereto and incorporated herein, is
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hereby approved. The President of the City Council is authorized
and directed to execute and deliver the Agreement on behalf of and
in the name of the City and the City Clerk is authorized and
directed to affix the seal of the City thereto and attest same.
SECTION 3.
Except to the extent inconsistent with this Ordinance and the
Agreement, all actions heretofore taken by the City and its
officers in furtherance of this Ordinance and the Agreement and
actions herein authorized are hereby confirmed, approved and
ratified. The City Manager and Director of Finance are hereby
authorized to take all actions necessary or appropriate to
effectuate the provisions of this Ordinance and the Agreement.
SECTION 4
All ordinances and resolutions, or parts thereof, of the City
inconsistent or in conflict with this Ordinance are hereby
repealed to the extent only of such inconsistency or conflict.
SECTION 5
This Ordinance shall become effective upon final passage.
INTRODUCED: November 26 , 1990
By KENNETH HUNTER
Councilperson
ATTEST:
City Clerk
APPROVED:
President of the City Council
TJ 48.24 -4-
SUBSTITUTED COPY
12/21/90
AGREEMENT
THIS AGREEMENT entered into as of this 21st day of December,
1990 between Pueblo, a municipal corporation, ( "City "), the Board
of County Commissioners of Pueblo County, Colorado ( "County ") and
Kaiser Aerospace & Electronics Corporation, a Nevada corporation
( "Kaiser ").
WHEREAS, there exists and has existed within the City and
County unemployment and underemployment and a lack of available
employment opportunities which places a public burden upon the
City and County and their citizens, and
WHEREAS, it is in the best interest of the City and County to
encourage economic development which creates employment opportuni-
ties and jobs for their citizens, and to appropriate funds for
purposes of stimulating investment and inducing industry to locate
within the City and County, and
WHEREAS, the prevention and reduction of unemployment and
underemployment and social and economic hardships associated
therewith are proper public purposes and matters of public concern
and public purpose which justify the expenditure of public funds,
and
WHEREAS, Kaiser has represented it will construct and equip
an approximately 135,000 square foot manufacturing building for
the production of advanced cockpit display systems, airborne
computers and other electronic equipment on an approximately 24.23
acre tract of land located within the City and use its best
efforts in good faith to employ 450 persons at such facility, and
that it will make a final determination whether to expand such
facility within five years after issuance of a certificate of
occupancy for the 135,000 square foot manufacturing facility and
thereafter use its best efforts in good faith to employ a total of
1100 persons at such expanded facility.
NOW, THEREFORE, in consideration of the foregoing and the
mutual obligations of the parties hereto and other good and
valuable consideration, the receipt and adequacy of which is
hereby acknowledged, each party covenants and agrees with the
other as follows:
SECTION 1. DEFINITIONS. The following words and phrases shall
have the following meaning in this Agreement:
(a) "Authorized Officer" means an officer of Kaiser_
authorized by resolution of the Board of Directors of Kaiser to
sign certificates under this Agreement on behalf_ of Kaiser.
(b) "Building" means the approximately 135,000 square foot
manufacturing building to be constructed as part of the Initial
Project.
(c) "City" means the City of Pueblo, a municipal corporation
organized and existing under Article XX of the Colorado Constitu-
tion.
(d) "City and County" means and includes both the City and
the County.
(e) "Construction Documents" means the construction
contracts and documents for the construction of the Building and
landscaping of the Land which will be submitted to City and County
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for review in the normal course.
(f) "County" means the County of Pueblo, Colorado, a county
and political subdivision organized and existing under the Consti-
tution and laws of the State of Colorado.
(g) "Director" means the Director of Finance of City.
(h) "Employees" means full -time employees including full-
time equivalents.
(i) "Expanded Project" means the construction, improvement
and equipping of an additional approximately 165,000 square foot
research, engineering and manufacturing building on the Land or
the expansion, improvement and equipping of the Initial Project to
approximately 300,000 square feet for the same or similar
purposes.
(j) "Fund" means an amount equal to Six (6) Million Dollars
plus the purchase price for the Land to be appropriated and made
available by City and County to Kaiser solely for Fund Purposes.
(k) "Fund Purposes" means actual expenditures made by Kaiser
out of the Fund for any purpose on and with respect to the Project
including operating expenses.
(1) "Initial Project" means the acquisition, landscaping and
improvement of the Land and the construction, improvement and
equipping of the Building for the development and production of
advanced cockpit display systems, airborne computers, aviation and
aerospace components and other electronic equipment.
(m) "Kaiser" means Kaiser Aerospace & Electronics Corpora-
tion, a corporation organized and existing under the laws of the
State of Nevada and a wholly owned subsidiary of K Systems, Inc.,
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a privately -owned California corporation.
(n) "Land" means approximately 24.23 acres of unimproved
vacant land located adjacent to and east of the University of
Southern Colorado within the City and described on the attached
Exhibit "A ".
(o) "Percentage" means the ratio between (i) the aggregate
amount of the Fund and (ii) the total cost of the Initial Project
as provided in the Construction Documents. For example, if the
Fund shall be $6,200,000 and the cost of the Initial Project shall
be $8,000,000, the Percentage shall be 77.5 %.
(p) "Project" means both the Initial Project and the
Expanded Project.
SECTION 2. CITY AND COUNTY OBLIGATIONS.
(a) Acquisition of the Land.
(i) Within ninety (90) days from the date of this
Agreement, City and County shall acquire the Land for a purchase
price not to exceed the fair market value of the Land as deter-
mined by a competent and qualified MAI appraiser acceptable to
City and County.
(ii) Contemporaneously with the acquisition of the Land
by City and County, Kaiser shall purchase the Land from City and
County for the same purchase price City and County shall have
paid, subject to the conditions set forth below in this section
2(a) . The time and place of closing shall be determined by City
and County.
(iii) Upon purchase of the Land by Kaiser, City and
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County will convey to Kaiser marketable title to the Land (less
dedicated roads, surface water detention facilities, and easements
required by any subsequent subdivision of the Land) by general
warranty deed free of liens and encumbrances except nondelinquent
taxes for the year of closing, and subject to easements,
restrictions, reservations, and rights of way of record as shown
in the Commitment and endorsement thereto and those placed upon
the Land by acts of Kaiser or as the consequence of any subsequent
subdivision plat filed by Kaiser.
(iv) Prior to purchasing the Land, City and County will
deliver to Kaiser a copy of the title insurance commitment (the
"Commitment ") obtained by them for the purposes of their acquisi-
tion of the Land together with a notice setting forth the closing
date for the purchase of the Land (the "Closing Date "), and the
purchase price for the Land, and with copies of the instruments
(or abstracts of instruments) listed in the schedule of exceptions
in the Commitment and shown of record in the office of the Pueblo
County Clerk and Recorder. If any endorsement is made to the
Commitment, City and County shall immediately forward a copy
thereof to Kaiser with copies of the instruments (or abstracts of
instruments) listed as exceptions in the endorsement to the
Commitment.
(v) It shall be a condition to Kaiser's obligation to
purchase the Land that the Land shall be acceptable to Kaiser in
Kaiser's sole discretion. Kaiser shall give written notice to the
City and County of any unmerchantability of title or other title
condition (as determined in Kaiser's sole discretion) that may be
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shown on the Commitment or any endorsement thereto within fifteen
(15) days after receipt by Kaiser of such Commitment or endorse-
ments. If City and County do not receive Kaiser's notice before
Closing Date, Kaiser shall be deemed to have accepted the condi-
tions of title as disclosed by the Commitment and endorsements
thereto.
(vi) Kaiser shall also have the right, prior to Closing
Date, to inspect the Land and perform soil tests and environmental
studies thereon, to review other information to determine the
environmental condition of the Land and its suitability for the
Project and to determine whether any other conditions of the Land
or of the transaction pursuant to which the Land shall be
purchased, including the purchase price, is unsatisfactory to
Kaiser. Written notice of any unsatisfactory condition revealed
by such inspection, soil tests, environmental studies and other
inspections shall be given to City and County within thirty (30)
days after receipt of the Commitment or any endorsement thereto by
Kaiser. If City and County do not receive Kaiser's notice before
Closing Date, Kaiser shall be deemed to have accepted the environ-
mental condition of the Land, the suitability of the Land for the
Project, the conditions of title, and the transaction pursuant to
which the Land shall be purchased, including the purchase price.
(vii) If City and County receive notice of
unmerchantability of title or any other unsatisfactory title
condition or other condition of the Land as above provided, City
and County shall use reasonable efforts to correct such
unsatisfactory title condition or other condition of the Land. If
City and County are unable to correct such unsatisfactory
conditions prior to Closing Date, this Agreement shall terminate
and the parties shall be released from all obligations hereunder.
Notwithstanding the foregoing, Kaiser may by written notice
received by City and County .five (5) or more days prior to Closing
Date, waive objection to any such unsatisfactory condition or
exception and agree to take title and the Land subject thereto.
(viii) Certain commitments have been made to Kaiser by the
University of Southern Colorado, Pueblo Economic Development
Corporation, Pueblo Community College and the Enterprise Zone
Administrator (the "Commitments ") If any such party or entity
fails to deliver their Commitment to Kaiser in form and content
acceptable to Kaiser in Kaiser's sole discretion, and Kaiser
delivers written notice of such failure to City and County five
(5) or more days prior to Closing Date, City and County will use
their best efforts to postpone the Closing Date, or City and
County or Kaiser may terminate this Agreement. If City and County
do not receive Kaiser's notice at least five (5) days prior to
Closing Date, Kaiser shall be deemed to have received the
Commitments in form and content acceptable to Kaiser.
(b) City and County shall provide, or cause to be provided,
at no cost to Kaiser, utility extensions to the property line of
the Land at mutually agreed upon locations reasonably required to
serve the Project. Kaiser and City and County will coordinate the
extension of utilities with Kaiser's construction of the Building.
The utility extensions are as follows:
(1) water - a minimum, of an 8 -inch line for
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private fire protection and a 6 -inch line for domestic water,
both connected to a 12 -inch main or larger, as required.
(2) electricity - an approximately 6,000 amp
line(s) providing 750,000 kilowatt (KWH) of use per month at
an estimately 2,000 kilowatt (KW) peak demand.
(3) gas - approximately 10,000 cubic feet per hour
domestic gas service for the Project.
(4) sewer - domestic sewer service lines connect-
ing to the City's sanitary sewage system adequate to serve
the Project.
(5) telephone - approximately 60 central office
telephone terminations for the Project.
(c) City and County will appropriate and make the Fund
available to Kaiser to be used solely and exclusively by Kaiser
for Fund Purposes. If Kaiser is not in default hereunder, City
and County will make periodic payments out of the Fund to Kaiser
for Fund Purposes within ten (10) days after receipt by the
Director of Kaiser's written application for payment ( "Kaiser
Application For Payment "). Kaiser Application For Payment will be
in such form as approved by City and County and be certified by an
Authorized Officer of Kaiser and will contain (i) the total amount
spent or obligated by Kaiser for the purchase of the Land and
labor actually performed and /or materials incorporated into or
delivered to the Land for the construction of the Initial Project
(the "Work ") since the date of any prior Kaiser Application For
Payment and a statement that such Work has not been included in
any other Kaiser Application For Payment, (ii) City and County's
Percentage of the total amount spent or obligated by Kaiser for
the Work, and (iii) a statement that all Work represented by such
Kaiser Application For Payment has been performed in conformity
with the approved Construction Documents and in compliance with
applicable law and regulations. Each Kaiser Application For
Payment will be accompanied by AIA Document G702, Application And
Certification For Payment properly completed by the contractor and
architect for the Work covered by each Kaiser Application For
Payment. Kaiser has furnished to City and County the Payment
Schedule attached as Exhibit "B ". Assuming the construction of
the Initial Project proceeds as planned, City and County's
Percentage of the total amount spent or obligated by Kaiser for
the Work will be paid to Kaiser at the time and in the amounts
shown on such Payment Schedule. However, in no event will such
payments be made earlier or in amounts greater than shown on the
Payment Schedule adjusted by any increase or decrease in the
purchase price for the Land.
The above disbursement procedure is strictly a mechanism to
insure Kaiser's commitment to construct and equip the Initial
Project and does not imply the Fund is to be used to reimburse
Kaiser for capital expenditures on the Initial Project and does
not imply the Fund is intended to be used for capital expendi-
tures.
(d) Kaiser will immediately upon receipt account for all
payments of the Fund made by City and County in a special internal
Kaiser Account (the "Special Account "). No other monies will be
accounted for in the Special Account except earnings therefrom.
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No payment or expenditure will be made from the Special Account
except for Fund Purposes. Kaiser will at least annually and until
the Special Account and Fund are fully expended account to City
and County for all payments and expenditures made by Kaiser from
the Special Account by delivering to City and County a copy of the
Special Account activities certified to be true and accurate by an
Authorized Officer of Kaiser describing all items for which Fund
Purpose expenditures were made. City and County may examine or
cause an examination or audit of the Special Account to be made at
reasonable times. Kaiser will cooperate in such examination or
audit and will retain all books and records relating to the
Special Account for a period of two years after_ the last expendi-
ture is made therefrom. Kaiser will expend the Fund for Fund
purposes no later than ten (10) years after the issuance of the
Certificate of Occupancy for the Building. The balance of the
Fund not so spent will be refunded and paid by Kaiser to City and
County within thirty (30) days after the expiration of such ten
year period.
SECTION 3. KAISER OBLIGATIONS.
(a) Kaiser will construct and equip the Initial Project.
The cost of constructing the Initial Project is estimated to be
Seven And One -Half (7.5) Million Dollars. The Initial Project
will be constructed in accordance with the approved Construction
Documents and in compliance with applicable laws and regulations.
If the City and County are not in default hereunder, Kaiser will
commence construction of the Initial Project within nine (9)
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months from date of this Agreement and will thereafter diligently
pursue the Initial Project's completion, and will in a timely and
expeditious manner take all action necessary and required to
construct and equip the Initial Project and obtain a Certificate
of Occupancy for the Building within eighteen (18) months after
the date of this Agreement. Kaiser will submit all Construction
Documents to City and County for approval, which approval will not
be unreasonably withheld. The President of the University of
Southern Colorado shall have approval authority of the aesthetic
appearance of the exterior design of the Building with regard to
it being consistent with the existing appearance of the Univer-
sity's architecture, which approval will not be unreasonably
withheld.
(b) Kaiser understands and agrees that the creation of jobs
as herein contemplated is the primary purpose for City and County
to enter into this Agreement and is the sole consideration and
benefit accruing to City and County hereunder. Accordingly,
Kaiser will use its best efforts in good faith to employ at the
Initial Project within three (3) years after issuance of the
Certificate of Occupancy for the Building and thereafter four
hundred and fifty (450) employees in the number, and categories of
employees set forth in the attached Exhibit "C ". If Kaiser
determines to complete the Expanded Project, Kaiser will use its
best efforts in good faith to employ at the Expanded Project
within a reasonable period of time after completion of the
Expanded Project and thereafter a total of one thousand one
hundred (1,100) employees (including the 450 employees at the
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Initial Project) in the number and category of employees set forth
in the attached Exhibit "D ".
(c) Construction contracts for the construction of the
Building and landscaping of the Land will be obtained through and
be based upon competitive bidding process and procedures. Kaiser
will invite general contractors having their principal place of
business within City and County who are in the opinion of Kaiser
qualified and experienced to perform the work to submit bids and
will to the extent practical and feasible, in the exercise of
Kaiser's business judgment, enter into construction contracts with
such local contractors, provided, that Kaiser reserves the right
to enter into contracts with other contractors if in Kaiser's sole
opinion it is necessary to obtain the best bid and technical
expertise.
(d) Within five (5) years after the issuance of the Certifi-
cate of Occupancy for the Building, Kaiser will make a final
determination as to whether it will construct the Expanded
Project. If Kaiser determines that it will construct the Expanded
Project, Kaiser will give written notice to City and County of its
commitment to construct the Expanded Project within such five year
period and complete the Expanded Project no later than seven (7)
years after the issuance of the Certificate of Occupancy for the
Building. If Kaiser (i) does not give written notice to City and
County of its commitment to construct the Expanded Project within
five ( 5 ) years after the issuance of the Certificate of Occupancy
for the Building, or (ii) if Kaiser timely gives notice and
commits to construct the Expanded Project and thereafter fails to
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complete the Expanded Project no later than seven (7) years after
the issuance of the Certificate of Occupancy for the Building,
then, in either event (i) or (ii), Kaiser will refund and pay Two
Million Dollars to City and County within 30 days after the
occurrence of the first of such events.
(e) If Kaiser does not commence its operations at the
Initial Project after issuance of the Certificate of Occupancy for
the Building, or if at any time during the five year period after
issuance of the Certificate of Occupancy for the Building, Kaiser
shall abandon its operations at the Initial Project, Kaiser shall
refund and pay to City and County the full amount of the Fund plus
the costs and expenses described in subsection (g)(ii) and (iii)
below within thirty days after the occurrence of either event.
For purposes of this subsection (e) the term "abandon its
operations" means cessation of operations at the Initial Project
for a period of thirty (30) days or more unless such cessation of
operations results from causes beyond the reasonable control of
Kaiser, or the failure of Kaiser to use its best efforts in good
faith to employ 450 employees at the Initial Project within three
years after the issuance of the Certificate of Occupancy for the
Building and thereafter during the balance of said five year
period.
(f) If Kaiser sells or transfers the Land at any time prior
to the expiration of five (5) years after the issuance of the
Certificate of Occupancy for the Building, Kaiser will reimburse
and pay to City and County an amount equal to the purchase price
paid by City and County for the Land. For purposes of this
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subsection (f) the term "sells or transfers" does not include an
assignment approved in accordance with Section 5(h) below nor a
sale or transfer to a wholly owned subsidiary of K Systems, Inc.
provided such subsidiary continues to conduct and operate a
manufacturing facility on the Land and uses its best efforts to
employ at least 450 employees at the Initial Project.
(g) If Kaiser does not commence actual construction of the
Building within nine (9) months from the date hereof and there-
after diligently pursue the construction to completion and take
all action required for the issuance of the Certificate of
Occupancy for the Building as required by Section 3(a) above,
Kaiser will reimburse and pay to City and County an amount equal
to the sum of ( i ) to the extent the purchase price has not
previously been paid, the purchase price for the Land paid by City
and County, (ii) all reasonable costs and expenses incurred by
City and County in the development of the Land, but only to the
extent that such costs and expenses have not increased the fair
market value of the Land, (iii) all reasonable costs and expenses
incurred by City and County in extending roads and utilities to
the Land, which costs and expenses shall be prorated among all
other parcels and lots that directly benefit from such extension,
and (iv) all amounts of the Fund paid to Kaiser (the "City and
County Costs "). City and County Costs will be reimbursed and paid
by Kaiser to City and County within thirty (30) days after City
and County give written notice thereof to Kaiser setting forth the
amount of City and County Costs and how and in what manner they
were computed together with supporting documents and invoices.
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(h) As security for the repayment obligations of Kaiser
under subsections (d), (e), (f) and (g) above, Kaiser, will, as a
condition precedent. to the duty and responsibility of City and
County to perform any obligation hereunder except to acquire the
Land, either, at its sole discretion (i) cause to be issued in an
amount equal to the Fund an unconditional, irrevocable Letter of
Credit in favor of City and County with a financial institution
acceptable to City and County, or (ii) grant or cause to be
granted to City and County a first mortgage or deed of trust on
real property having a market value at least equal to the Fund as
determined by a qualified and experienced MAI appraiser acceptable
to City and County. The Letter of Credit or mortgage or deed of
trust will be in form and content acceptable to City and County
and if a mortgage or deed of trust, Kaiser will furnish at its
cost an ALTA Lender title insurance policy acceptable to City and
County insuring the mortgage or deed of trust in the name of City
and County in an amount equal to the Fund, subject only to excep-
tions approved by City and County, which approval will not be
unreasonably withheld. If Kaiser fails to pay any obligation
under Sections 3(d), (e), (f) or (g) when due, such obligation
shall accrue interest at the rate of ten (10) percent per annum.
(i) If Kaiser (i) timely completes the Initial Project and
has used its best efforts in good faith to employ 450 employees as
required by Sections 3(a) and (b) above, (ii) does not abandon its
operations at the Initial Project as provided in Section 3(e)
above, (iii) either refunds and pays to the City and County Two
Million Dollars, or completes the Expanded Project and has used
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its best efforts in good faith to employ 1,100 employees as
required by Sections 3(b) and 3(d) above, and (iv) either expends
the Fund for Fund Purposes no later than ten (10) years after the
issuance of the Certificate of Occupancy for the Building or
refunds and pays to City and County the balance of the Fund not so
expended as required by Section 2(d) above, Kaiser will be
released from all obligations under this Agreement and have the
right to dispose of the Land without any further obligation to
City or County.
(j) If City or County fail to pay any obligation under
Section 2(c) when due, or if City and County fail to discharge any
other of their obligations hereunder when required pursuant to
this Agreement and Kaiser shall be required to advance funds to
perform such delinquent obligations of City and County, and a
judgment is entered against City and County and in favor of Kaiser
for such overdue payment or other advance by Kaiser, then such
overdue payment or other advance by Kaiser shall accrue interest
at the rate of ten (10) percent per annum from the date such
payment became due or the date such advance was made by Kaiser
until said judgment is satisfied or otherwise paid.
SECTION 4. CONTINGENCIES.
This Agreement and the parties' obligations hereunder are
contingent upon:
(a) City and County acquiring the Land and conveying the
Land to Kaiser as described in Section 2(a).
(b) City and County appropriating the Fund as required in
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Section 2(c).
If any of the above conditions have not been met or complied
with in the time and manner set forth in this Agreement, the
parties may in writing jointly waive or postpone the condition, or
either party may terminate this Agreement by written notice given
to the other parties specifying the grounds for termination, and
upon such termination all parties will be released from all
obligations under this Agreement.
If the above conditions have been timely met and complied
with, the duty and responsibility of City and County to perform
any other obligation on their part to be performed hereunder is
contingent upon and subject to the receipt of the letter of credit
or other documents as provided in Section 3(h).
SECTION 5. MISCELLANEOUS.
(a) This Agreement shall be governed by the laws of the
State of Colorado and shall be construed in accordance therewith.
(b) Time is of the essence hereof. No provision of this
Agreement may be waived 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.
(c) This Agreement shall be binding on the parties, their
successors and approved assigns. The parties agree to do any and
all things necessary to effectuate the purposes of this Agreement.
(d) Throughout this Agreement, the singular shall include
the plural, the plural shall include the singular, and the
masculine and neuter shall include the feminine, wherever the
-17-
context so requires.
(e) The headings of sections are included solely for
convenience of reference. If any conflict between any heading and
the text of this Agreement exists, the text shall control.
(f) This Agreement sets forth the entire understanding of
the parties and may be amended, altered or revoked at any time, in
whole or in part, only by filing with this Agreement a written in-
strument setting forth such changes, signed by the parties hereto.
(g) Should any action at law or in equity be brought by any
party to this Agreement to enforce any right or remedy hereunder,
such action will be brought in the District Court in and for the
County of Pueblo, State of Colorado and the parties hereto consent
to the venue and personal jurisdiction of such Court. In the
event of any litigation arising out of this Agreement, the court
shall award to the prevailing party all reasonable costs and
expenses, including .reasonable attorney fees.
(h) Kaiser shall not assign this Agreement nor any interest
herein without consent of City and County, which consent will not
be unreasonably withheld . Any attempted assignment or assignment
by Kaiser without the prior consent of City and County shall be
void and unenforceable.
(i) All notices required to be given by this Agreement shall
be made in writing and served either by:
(i) Personal delivery to the party requiring notice; or
(ii) Mailing notice via the U.S. Mail to the last known
address of the party requiring notice, by first class mail,
postage prepaid.
Effective date of the notice shall be the date of the
personal delivery as specified in subparagraph (i) above or four
(4) days after the date the notice was deposited in the U.S. Mail
as specified in subparagraph (ii) above.
For purposes of this section, the initial addresses of
the parties hereto shall be as follows:
Kaiser City
Kaiser Aerospace & City Manager
Electronics Company City of Pueblo
800 Tower Lane 1 City Hall Place
Foster City, CA 95134 Pueblo, CO 81003
Attention: Secretary
County
County Manager
Pueblo County Courthouse
10th and Main Streets
Pueblo, Colorado 81003
(j) This Agreement supersedes all other contracts or agree-
ments between the parties hereto with respect to the subject
matter of this Agreement.
(k) Each person signing this Agreement represents and
warrants that the Agreement has been approved by the entity or
organization in whose name he is signing and that he has been duly
authorized to sign this Agreement in the name of and on behalf of
such entity or organization.
IN WITNESS WHEREOF, Kaiser has caused this Agreement to be
executed by its duly authorized officers, and City and County have
caused this Agreement to be executed by their duly authorized
representatives both on the day and year first written above.
KAISER AEROSPACE &
[S E A L] ELECTRONICS COMPANY
-19-
ATTEST:
ecretary
By
its
CITY OF PUEBLO,
A MUNICIPAL CORPORATION
[S E A LJ
ATTEST: B
City Clerk President of the City Council
BOARD OF COUNTY COMMISSIONERS OF
PUEBLO COUNTY. COLORAnn
[S E A L]
ATTEST:
County Cler
& Recorder
M
airman
TJ 48.2 -20-
A Parcel of land located within a portion of the SE1 /4 Range of Section
being in Township 20 South, h� of the 6th P.M of Section 20
more particularl f , all
BEGINNING at Y described as follows: M•, being
the Southeast corner of said Section 17;
thence S "W, a distance of 60.00 feet to the West
0 6 right -of -way line
thence S01* Of Troy Avenue as presently located;
distance of 2g502, along the said West right-of S62'39'54"W,� Y line, a
right-Of-way a distance of 162 feet to the Northerly
1 •
Y line .02
of University of Southern Colorado Entrance Road
along said Northerly right Road, the - of-way Y courses:
University of Southern Colorado
along the arc of a g 4 courses:
and whose center bears N0 Southern
to the ri ght 57'02 "E, a d istance e of a 321 . 18 s feet,
feet ;
2• N "w, a distance of 213.54 feet;
3 • along the arc of a curve to
feet; a distance of 140. the left whose radius is
35 feet; 550.00
4 • N57'g6� �� W,
i: N5 37 a distance o£ 445.76 feet to a
Y boundary line of the University Point on the
thence along the said Easterl Y °f Southern Colorado; the are of a cu
to the right, whose radius is f line
'351'31'35 "• of 00 feet
E andowhose center bears
, a distance 88.52 feet;
thence continuing along said Fasterl
C distance of 1500.00 feet, Y boundar
Section 17; to a point on the yEast lin line 2of2said
thence along East ast line of
distance of 1 the Ea said Section 17 S01 24-02" a
Pueblo feet, to the POINT OF BEGINNING County of
State of Colorado.
EXHIBIT "A"
PAYMEN SCHEDULE
September 1991
October 1991
November 1991
December 1991
January 1992
February 1992
March 1992
April 1992
May 1992
$ 200,000
480,000
870,000
1,130,000
1,175,000
1,000,000
855,000
250,000
294,000
$6,254,000
Notes:
1. Payment schedule is based on $6,000,000 commitment from the
City and County and a land cost of $254,000
2• Payment dates are the 10th day of each month
September 10, 1991 commencing
EXHIBIT "B"
EXHIBIT "C"
Assemblers and Inspectors
Testers and Technicians
Mfg., Quality and Test Equipment Engineers
Manufacturing Support
Management and Administration
Total
dotes:
Approximately
150
Approximately
150
Approximately
30
Approximately
30
Apgro ma ely_ 0,
Approximately
450
The above is an estimate of the employment profile for the initial project.
The catagories and quantities are subject to change and are dependent
upon business conditions and the products in the manufacturing process.
EXHIBIT "D"
Technica; Staff with the equivalent
Of; BS; MS; or PhD. Approximately 300
Technical Staff with an AA or equivalent Approximately 100
Mfg, Staff (in addition to the initial project) Approximately 150
Management and Administration
(in addition to the initial project) L.9.��5? 1 gg
Total
Approximately 650
Notes:
The above is an estimate of the employment profile for the expanded
project.
The catagories and quantities are subject to change and are• dependent
upon business conditions and the products in the design and manufacturing
process.
D D 0
City of Pueblo
OFFICE OF THE CITY ATTORNEY
127 Thatcher Building
PUEBLO, COLORADO 81003
January 3, 1991
Ms. Marian Mead
City Clerk
1 City Hall Place
Pueblo, CO 81003
Re: Ordinance No. 5651
Dear Marian:
Enclosed is a copy of the council background paper which should be
filed with the above ordinance.
Very truly yours,
lam''
Thomas E. Jagger
sm
enc.
k , III III 11 1
1
�� ED
v
OFFICE OF THE CITY ATTORNEY
CITY COUNCIL 127 West, First National Bank Bldg.
BACKGROUND PUEBLO, COLORADO 81003
MEMORANDUM
TO: City Council
FROM: City Attorney
DATE: November 26, 1990
RE: Kaiser Aerospace & Electronics Corporation, Ordinance and
Agreement
The Ordinance approves and authorizes the City to enter into the
attached Agreement dated November 26, 1990 between Kaiser
Aerospace & Electronics Corporation ( "Kaiser "), Pueblo County and
the City.
The Agreement is based upon and incorporates prior commitments
made to Kaiser and generally provides:
1. City and County will pay $6 million to Kaiser. Although
not set forth in the Agreement, it is my understanding $4 million
will be paid by City and $2 million by County. City will spend an
additional $1 to $1.2 million to: acquire the land and convey it
to Kaiser and extend roads and utilities in sufficient size to
serve both the initial facility and expanded facility.
2. Kaiser will not use any of the $6 million for the
construction and equipping the initial facility. The constructing
and equipping of the initial facility will be paid for out of the
$9.8 million revenue bonds used by the County.
3. Kaiser may use the $6 million for any purpose on and
with respect to the project (both the initial facility and
expanded facility) including operating expenses. Kaiser must
spend the $6 million within ten years after the issuance of the
certificate of occupancy for the initial project. The $6 million
will be paid to Kaiser based upon a payment schedule and the
progress of the construction of the initial facility. Kaiser will
deposit the $6 million into a special account to be used on and
with respect to the project. The City may examine and audit the
special account.
4. Kaiser will construct a 135,000 foot facility on the
land ( "initial facility ") and use its best efforts in good faith
to employ 450 persons at the initial facility within approximately
four years. The payment of the $6 million to Kaiser, land trans-
fer, and road and utility extensions are not contingent upon the
number of persons employed by Kaiser but are tied to Kaiser's
exercise of its best efforts in good faith to employ 450 persons.
E
Therefore, if Kaiser exercises its best efforts but only employs,
as an example, 350 persons, Kaiser has
commitments. fulfilled its contractual
5. Kaiser has not contractually committed to expand
initial facility to a 300,000 square foot expanded facility. the
Such
expansion will be at Kaiser's sole option and discretion. The
decision whether to expand or not must be made by Kaiser within
five years after the issuance of the certificate of occupancy for
the initial facility. If Kaiser decides not to expand, Kaiser has
contractually committed only to use its best efforts to employ 450
persons. However, if Kaiser does expand, it will use its best
efforts to employ 1,100 persons (including the 450 persons at the
initial project) within a reasonable time after completion of the
expanded facilities.
6. If Kaiser decides not to expand the project, Kaiser will
refund $2 million to the City and County.
7 . If Kaiser does not commence its operations at
the
initial facility, or if Kaiser "abandons its operations" at the
initial facility during the five year period after the issuance of
the certificate of occupancy for the initial facility, Kaiser will
refund the $6 million and City's expense in acquiring and
developing the land. The term "abandons its operations" includes
cessation of operation for 30 days or more and Kaiser's failure to
use its best efforts to employ 450 persons.
8 . If Kaiser does not commence construction within 9 months
and complete construction of the initial facility the
issuance of the certificate of occupancy) 1 (including
) Kaiser
will reimburse the City for all expenses incurred months,
nacquiringand
developing the land and refund all amounts of the $6 million paid
to Kaiser.
9. As security for Kaiser 's repayment obligation, Kaiser
will cause to be issued a $6 million letter of credit or a first
mortgage on other property having a fair market value of at least
$6 million.
and
be
of
10. The mutually acceptable date City will acquire the land
Exhibits "C" and "D" (the number and categories of persons to
employed) will be furnished by Kaiser prior to final approval
the ordinance and added to the Agreement by Council amendment.
The foregoing
be complete.
more detailed
and terms.
description of major provisions does not purport to
Please refer to the Ordinance and Agreement for a
and complete statement of the provisions, covenants
T omas E agger
48.30/jp