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HomeMy WebLinkAbout2006-11-7206139 83674 ORDINANCE NO. 2006-11-7206 AN ORDINANCE OF THE CITY OF PADUCAH, KENTUCKY APPROVING THE MEMORANDUM OF UNDERSTANDING AMONG THE CITY OF PADUCAH, KENTUCKY, THE COUNTY OF MCCRACKEN, KENTUCKY, THE PADUCAH MCCRACKEN COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY, AND INFINITI PLASTIC TECHNOLOGIES, INC., WITH RESPECT TO A PUBLIC PROJECT, AND AUTHORIZING THE EXECUTION THE MEMORANDUM OF UNDERSTANDING WHICH DOCUMENTS THE AGREEMENT OF THE PARTIES AS TO THE REIMBURSEMENT OF CONSTRUCTION OVERAGES RESULTING FROM THE PUBLIC PROJECT. WHEREAS, the City of Paducah, Kentucky (the "City") has previously determined, and hereby further determines, that it is a public purpose to reduce unemployment in the City, to increase the City's tax base, to foster economic development within the City and to promote the development of a skilled workforce, all to the benefit of the citizens and residents of the City; and WHEREAS, the City has previously determined that in order to accomplish such public purposes that the City and the County of McCracken (the "County") would proceed with the construction and installation of an approximately 100,000 square foot facility (the "Project"), which Project is jointly owned by the City and the County and to lease same to Infiniti Plastic Technologies, Inc. ("Infiniti"), for industrial development and operation; and WHEREAS, pursuant to the terms and provisions of the lease arrangement, Infiniti was �. granted a construction allowance not to exceed $4,600,000.00 (the "Construction Allowance") for the construction and installation of the Project and Infiniti agreed to be solely and completely responsible for �- construction cost in excess of the Construction Allowance; and WHEREAS, the construction cost of the Project was in excess of the Construction Allowance by the sum of $71,455.50 (the "Construction Overage") which sum the City and County now seek reimbursement; and WHEREAS, the City, the County, the Paducah -McCracken County Industrial Development Authority ("IDA"), and Infiniti have agreed to offset the Construction Overages owed by Infiniti against the incentive Relocation Grants to be provided by the City and the County to Infiniti under Section 3 of City Ordinance No. 2004-4-6783(3) and County Ordinance # 2004-4, in accordance with the specific terms and conditions of the Memorandum of Understanding among the City, County, IDA, and Infiniti; and NOW THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF PADUCAH, KENTUCKY, AS FOLLOWS: Section 1. Recitals and Authorization. The City hereby approves the Memorandum of Understanding among the City, the County, the IDA, and Infiniti in substantially the form attached hereto as Exhibit A and made part hereof. It is hereby found and determined that the Project identified in the Memorandum of Understanding is public property to be used for public purposes. It is further determined that it is necessary and desirable and in the best interests of the City to enter into the Memorandum of Understanding for the purposes therein specified, and the execution of the Memorandum of Understanding is hereby authorized and approved. The Mayor of the City is hereby authorized to execute the Memorandum of Understanding, together with such other agreements, instruments or certifications which may be necessary to accomplish the transaction contemplated by the Memorandum of Understanding with such changes in the Memorandum of Understanding not inconsistent with this Ordinance and not substantially adverse to the City as may be approved by the official executing the same on behalf of the City. The approval of such changes by said official, and that such are not substantially adverse to the City, shall be conclusively evidenced by the execution of such Memorandum of Understanding by such official. 140 aw.M.«kah��1,.aLvi , ,_ul—.L-1 --.: ..L.,.«. 4—.«,:.w...:. Section 2. Severability. If any section, paragraph or provision of this Ordinance shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this Ordinance. Section 3. Compliance With Open Meetings Laws. This City Commission hereby finds and determines that all formal actions relative to the adoption of this Ordinance were taken in an open meeting of this City Commission, and that all deliberations of this City Commission and of its committees, if any, which resulted in formal action, were in meetings open to the public, in full compliance with applicable legal requirements. Section 4. Conflicts. All ordinances, resolutions, orders or parts thereof in conflict with the provisions of this Ordinance are, to the extent of such conflict, hereby repealed and the provisions of this Ordinance shall prevail and be given effect. Section 5. Effective Date. This Ordinance shall be read on two separate days and will become effective upon summary publication pursuant to KRS Chapter 424. ATTEST: JMXMM /�& /( Tammara S. Brock, City Clerk Introduced by the Board of Commissioners, October 24, 2006 Adopted by the Board of Commissioners, November 14, 2006 Recorded by Tammara S. Brock, City Clerk, November 14, 2006 Published by The Paducah Sun, November 22, 2006 ord\mou-infiniti construction overage EXHIBIT A MEMORANDUM OF UNDERSTANDING SEE ATTACHMENT Cl 141 142 MEMORANDUM OF UNDERSTANDING THIS MEMORANDUM OF UNDERSTANDING (the "Memorandum") is made and entered into this the day of , 2006, by and among the CITY OF PADUCAH, a public body politic and an incorporated municipality, with address of 300 South 5th Street, Paducah, Kentucky 42001, hereinafter known as "City"; the COUNTY OF MCCRACKEN, a county and political subdivision of the Commonwealth of Kentucky, with address of 301 South 6`h Street, Paducah, Kentucky, 42003, hereinafter known as "County"; the PADUCAH-MCCRACKEN COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY, a body politic and corporate of the commonwealth of Kentucky established pursuant to the i provisions of KRS 154.50-301 to KRS 154.50-346, as may be amended, hereinafter known as "IDA"; and the INFINITI PLASTIC TECHNOLOGIES, INC., a Kentucky corporation, having its principal offices and place of business at 19481 Harborgate Way, Torrance, CA 90501, hereinafter known as "Infiniti". RECITALS: WHEREAS, the City and County are each owners of an undivided fifty percent interest in certain real property located within Industrial Park West of the City of Paducah, McCracken County, Kentucky, (the Project Site"); and WHEREAS, IDA has been created and established by the City and County pursuant to the IDA Act for the purpose of encouraging the acquisition, retention, development, and promotion of industrial sites to meet industrial and commercial needs within the jurisdictions of the City and County; and WHEREAS, in order to promote the welfare of it inhabitants by relieving conditions of unemployment and encouraging the increase of industry, the City and County have financed the acquisition, construction and installation of an approximately 100,000 square foot shell building, together with necessary appurtenances (the Project Building") on the Project Site and have leased the Project Building and Project Site (collectively, the "Project") to IDA; and WHEREAS, to further the public purposes of the City and County, IDA has sublease the Project to Infiniti, pursuant to the terms and provisions of a certain Capital Sublease Agreement dated March 24, 2004 (the "Sublease"); WHEREAS, pursuant to the terms and provisions of the Sublease, Infiniti was granted a construction allowance not to exceed $4,600,000.00 (the "Construction Allowance") for the construction and installation of the Project Building and Infiniti agreed to be solely and completely responsible for construction cost in excess of the Construction Allowance; and WHEREAS, the construction cost of the Proj ect Building is in excess of the Construction Allowance by the sum of $71,455.50 (the "Construction Overage") which sum the City and County now seek reimbursement from Infiniti as required under the terms and provisions of the Sublease and Infiniti has agreed to so reimburse the City and County for the Construction Overage; and WHEREAS, the City and County have previously adopted Ordinances No. 2004-4-6783(3) and Ordinance # 2004-4, respectively, (collectively the Ordinances") granting certain economic incentives to Infiniti in order to induce significant expansion of industrial development within the corporate boundaries of the City and County; and WHEREAS, Section 3 of the Ordinances provides as follows: 3. Provide to Infiniti annual relocation grants, on a descending schedule, for a nine (9) year period; the sum total of the aforesaid grants will not exceed $91,512.00; the County and City share being $45,756.00 each (the "Relocation Grant"). WHEREAS, the Relocation Grant descending schedule is further described in the Enhanced Offer _ Correspondence dated January 9, 2004, to Mr. Saeed Yousefian, a true an accurate copy of which is attached hereto as Exhibit "A;" and WHEREAS, Infiniti seeks to reimburse the City and County for the Construction Overage by offsetting Year 2 through Year 9 of the Relocation Grant against the Construction Overage and the City and County have agreed to such offset under the terms and conditions enumerated herein. NOW, THEREFORE, in consideration of the mutual covenants and conditions contained herein, and for other good and valuable consideration, the receipt, mutuality and sufficiency of all of which is hereby acknowledged by the parties hereto, the City, County, IDA and Infiniti each agree as follows: - L'--��,,,,,,.,,...M,.,:muwMuvurea�ubwmmHYw�.,iuwMm LL::., U<.wd.t 143 SECTION 1 AGREEMENT OF THE PARTIES A. All parties hereto covenant and agree that all of the above recitals are specifically incorporated herein by reference. B. Infiniti covenants and agrees that it is responsible for reimbursing the City and County for the Construction Overage in the sum of $71,455.50. C. Infiniti covenants and agrees to release, relinquish, and waive any and all rights it or any of its subsidiaries may have in and to Year 2 through Year 9 of the Relocation Grant and agrees to offset the Relocation Grant against the Construction Overage owed to the City and County. D. The City and County covenant and agree that the setoff of Year 2 through Year 9 of the Relocation Grant shall be in full and complete satisfaction of the Construction Overage owed by Infiniti to the City and County. E. All parties hereto covenant and agree, that after Year 1 of the Relocation Grant the City and County shall no longer be obligated to make payment there under and the Relocation Grant will be satisfied in full. SECTION 2 MUTUALITY OF OBLIGATIONS A. The parties agree that the obligations imposed upon the parties are for the benefit of the parties and each agrees to diligently pursue the fulfillment of its obligations in accordance with this Memorandum. The failure of any party to fulfill its obligations under this Memorandum shall constitute a breach of this Memorandum unless the fulfillment of such obligation is waived or modified by a written agreement of the parties. B. Except as may otherwise be provided herein, the parties to this Memorandum of Understanding shall be solely responsible for any cost incurred in fulfilling their obligations under this Memorandum of Understanding and no party shall have a claim against the other party for reimbursement of ` such cost, whether or not a party is in default. SECTION 3 MISCELLANEOUS PROVISIONS A. This Memorandum may be signed by each party upon a separate copy, and in such case, one counterpart of this Memorandum shall consist of a sufficient number of such copies to reflect the signatures of the parties hereto. This Memorandum may be executed in two or more counterparts, each of which shall be deemed an original, and it shall not be necessary in making proof of this Memorandum or the terms and conditions hereof to produce or account for more than one of such counterparts. B. The headings set forth in this Memorandum are for convenience or reference only, and the words contained therein shall in no way be held to explain, modify, amplify or aid in the interpretation, construction or meaning of the provisions of this Memorandum. C. The terms and conditions of this Memorandum shall be binding upon and shall inure to the benefit of the successors and assigns, respectively, of the parties. This provision shall not be construed to permit assignment by any part of any of its rights and duties under this Memorandum, which assignment shall be prohibited except with the prior written consent of all parties hereto. D. This Memorandum sets forth the entire understanding of the parties with respect to the subject matter hereof, supersedes all existing agreements among them concerning the subject matter hereof, and may be modified only by a written instrument duly executed by each of the parties hereto. E. The parties agree that any suit, action or proceeding with respect to this Memorandum shall only be brought or entered by, as the case may be, the courts of the Commonwealth of Kentucky, situated in Paducah, Kentucky. F. All notices, requests, demands, waivers and other communications given as provided in this Memorandum shall be in writing, and shall be addressed to the mailing addresses list above. IN WITNESS WHEREOF, the parties hereto have executed this Memorandum as of the date first above written. CITY: CITY OF PADUCAH, KENTUCKY BY: l TITLE:_ INFINITI: INFINITI PLASTIC TECHNOLOGIES, INC : TITLE: COUNTY: COUNTY OF MCCRACKEN BY: TITLE: IDA: PADUCAH-MCCRACKEN COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY mm TITLE: 144