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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 -2- 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. CVnrrTnWT 7 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 -3- 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 -2- 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., -3- 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 QE 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 M7= 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 -7- 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. QM 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) -10- 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 -11- 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 -12- 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 -13- 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. -14- (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 -15- 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 -16- 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