Loading...
HomeMy WebLinkAbout101-97 Ordinancec ORDINANCE NO. ~-97 AN ORDINANCE AUTHORIZING THE EXECUTION AND DELIVERY OF AN ECONOMIC DEVELOPMENT AGREEMENT TO INDUCE A LEASE BETWEEN DUKE REALTY LIMITED PARTNERSHIP AND LCI INTERNATIONAL MANAGEMENT SERVICES, INC., OF APPROXIMATELY 156,000 SQUARE FEET OF NEWLY CONSTRUCTED OFFICE SPACE THEREBY INCREASING EMPLOYMENT WITHIN THE CITY, AND DECLARING AN EMERGENCY. WHEREAS, Duke Reality Limited Partnership ("Duke") has constructed on certain real property (the "Property") located in the City of Dublin, Ohio (the "City") approximately 156,000 square feet of office space (the "Office Space"), and based on inducements and incentives previously offered by the City, Duke leased a substantial portion of that Office Space to LCI International Management Services, Inc. ("LCI"); and WHEREAS, the City, by provision of the incentives provided in the Economic Development Agreement referred to in Section 1 of this Ordinance, desired and intended to and did induce Duke and LCI to enter into the lease of that Office Space for the purpose of creating jobs and employment opportunities and to improve the economic welfare of the people of the State of Ohio and the City as authorized in Article VIII, Section 13 of the Ohio Constitution; NOW, THEREFORE, BE IT ORDAINED by the City of Dublin, Franklin, Union and Delaware Counties, Ohio, that: Section 1. The City hereby finds and determines that it was and is necessary and +~ appropriate and in the best interests of the City to provide certain assistance to LCI for the purpose of creating jobs and employment opportunities and to improve the economic welfare of the people of the State of Ohio and the City as authorized in Article VIII, Section 13 of the Ohio Constitution. Section 2. To provide the assistance to Duke and LCI and thereby to induce Duke and LCI to complete all transactions contemplated by and between Duke and LCI for the Office Space, the City Manager and the Director of Finance, for and in the name and on behalf of the City, shall execute, acknowledge and deliver the Economic Development Agreement by and between the City and LCI in substantially the form thereof on file with the Clerk of Council. That Agreement is approved with changes therein not inconsistent with this ordinance and not substantially adverse to the City and which are permitted by law, and shall be approved by the City Manager and the Director of Finance; provided, that the approval of those changes by such officers, and their character as not being substantially adverse to the City, shall be evidenced conclusively by their execution of those instruments. Section 3. The City Manager and the Director of Finance shall execute, deliver and, if applicable, file, for and in the name and on behalf of the City, any other materials, documents .~ or certifications which are necessary or appropriate to consummate the transactions contemplated in this ordinance and the Economic Development Agreement. ~... Section 4. This Council finds and determines that all formal actions of this Council concerning or relating to the passage of this ordinance were taken in an open meeting of this Council and that all deliberations of this Council that resulted in those formal actions were in meetings open to the public in compliance with the law. Section 5. This ordinance is declared to be an emergency measure and necessary for the immediate preservation of the public peace, health, safety or welfare of this City and for the further reason that this ordinance is required to be immediately effective in order to provide for the implementation of economic development incentives for the leasing of the Office Space on the Property at the earliest possible time to create jobs and employment opportunities and improve the economic welfare of the people of the City; wherefore, this ordinance shall be in full force and effect immediately upon its passage. Signed: esidmg Officer Attest: ~.~~~ Clerk of Council Passed: 1997 Effective: h C , 1997 r f harel~y rerr fv t!„af rope; of tfF:s ~r~ +~~>,~,;':---:.~.~,,, ., , City of Du61in in accordance w;t' l ' ''~~e€t in the ~+ Sect en 731 ~$ c :~>~i,ed Cade. -____. P _ ~.s~-. Cle-k f C ncil, Du I Ohio -2- 07/16/97 DRAFT ECONOMIC DEVELOPMENT AGREEMENT This Economic Development Agreement (the "Agreement"), is made and entered into as of this day of , 1997, between the CITY OF DUBLIN, OHIO (the "City"), '"~" a municipal corporation organized and existing under the constitution and the laws of the State of Ohio, and LCI INTERNATIONAL MANAGEMENT SERVICES, INC. ("LCI"), a Delaware ,~,,, corporation with offices located in Dublin, Ohio. As used herein, references to LCI include any subsidiary or affiliate to which LCI may assign all or any portion of rights pursuant to Section 7 of this Agreement. The City and LCI may be referenced herein individually as a "Party" and collectively as the "Parties". WITNESSETH: WHEREAS, Duke Realty Limited Partnership has constructed or caused to be constructed on a portion of certain real property located in the City, which property is depicted on Exhibit A-1 and described in Exhibit A-2 attached hereto (the "Property"), the private improvements consisting of an approximately 156,000 square foot building and related facilities more particularly described on Exhibit B hereto (the "Duke Improvements"), and has leased those Duke Improvements based on the inducements and incentives from the City provided in this Agreement; and WHEREAS, the City previously determined that it was necessary and appropriate and in the best interests of the City to offer certain assistance to LCI for the purpose of creating jobs and employment opportunities and to improve the economic welfare of the people of the State of Ohio and the City as authorized in Article VIII, Section 13 of the Ohio Constitution, and the City therefore determined to provide or advance to LCI from the City's non-tax revenues an amount (equal to the lesser of (i) $300,000 or (ii) the costs of installation) to pay costs of installing a fiber optic connection including related equipment between the Duke Improvements and LCI's facility located at 4650 Lakehurst Court in the City of Columbus, all for the purpose of inducing LCI to lease the Duke Improvements from Duke, and with that amount subject to repayment as provided in this Agreement; and WHEREAS, LCI has represented that by June 1, 1999, LCI and its subsidiaries, affiliates or associated companies will add a total of not less than 650 jobs in the City of Dublin; NOW, THEREFORE, in consideration of the premises and covenants contained herein, and to provide incentives to LCI as provided herein, the Parties agree as follows: 1. Payment by CitX. Not later than August 15, 1997, the City shall provide or advance to LCI, solely from the City's non-tax revenues, an amount (equal to the lesser of (i) $300,000 or (ii) those costs of installation) to pay costs of installing a fiber optic connection including related equipment between the Duke Improvements and LCI's facility located at 4650 ,.~. ,.~. Lakehurst Court in the City of Columbus for the purpose of inducing the lease of the Duke Improvements by LCI from Duke and in consideration of certain obligations of LCI contained herein. Nothing herein shall be construed as requiring the City to use any funds or revenues from any source other than non-tax revenues of the City. 2. Payroll Covenant: Re~avment. LCI anticipates that LCI and its affiliates and subsidiaries will by July 1, 1997, have located a portion of their operations at the Duke Improvements, and will thereafter maintain in the Ciry at the Duke Improvements through June ~"" 30, 1999 (the "Calculation Period") employment of a sufficient payroll to generate income tax revenues paid in the form of payroll withholding taxes to the City (the "Payroll Taxes") of not less than $300,000 (the "Withholdings Requirement"). For purposes of this Section 2, the parties shall assume that the City's Payroll Tax rate is not less than 2 % (whether or not the that City tax rate is decreased over such Calculation Period). If the withholdings for City Payroll Taxes from employees of LCI and its affiliates, subsidiaries and associated companies located in the Duke Improvements are less than the Withholdings Requirement for the Calculation Period, LCI shall repay to the Ciry an amount equal to one hundred percent (100%) of the difference between: (a) the City's contribution of the lesser of (i) $300,000 or (ii) the costs of installing the fiber optic connection described above, minus (b) the actual amount of Payroll Taxes paid to the City during that Calculation Period, using the assumptions in this Section 2. Notwithstanding any other provision of this Agreement the maximum repayment by LCI to the Ciry under this Section 2 shall not exceed the actual City contribution referred to in clause (a) above. "^ The City shall calculate the repayment amount due from LCI, if any, under Section 2 and notify LCI in writing of the repayment amount due, if any. Such repayment shall be made by LCI to the City on or before thirty (30) days after LCI receives that written notice from the w~ City. 3. Force Majeure. Notwithstanding the foregoing, if, by reason of Force Majeure, LCI is unable to perform or observe any agreement, term or condition hereof, LCI shall not be deemed in default or liable for any payments during the continuance of such inability and the time for performance of any of LCI's obligations delayed by such disability shall be suspended until the disability is alleviated. LCI shall promptly give notice to the Ciry of the existence of an event of Force Majeure and shall use its best efforts to remove the effects thereof; provided that the settlement of strikes or other industrial disturbances shall be entirely within the discretion of LCI, as applicable. The term Force Majeure shall mean, without limitation, the following: -2- (i) acts of God; strikes, lockouts or other industrial disturbances; acts of public enemies; orders or restraints of any kind of the government of the United States of America or of the State or any of their departments, agencies, political subdivisions (other than discretionary acts of the City and any entity under the direct legal control of the City) or officials, or any civil or military authority; insurrections; civil disturbances; riots; epidemics; landslides; lightening; earthquakes; fires; hurricanes; tornados; storms; droughts; floods; arrests; restraint of government and people; explosions; breakage, malfunctions or accident to facilities, machinery, transmission pipes or canals; partial or entire failure of utilities; shortages of labor, materials, supplies or transportation; or (ii) any cause, circumstance or event not reasonably within the control of the City or LCI, as applicable. 4. Agreement Binding on City: No Personal Liability. All covenants obligations and agreements of the City contained in this Agreement shall be effective to the extent authorized and permitted by applicable law. No such covenant, obligation or agreement shall be deemed to be a covenant, obligation or agreement of any present or future member, officer, agent or employee of the City or LCI in other than their official capacity, and neither the members of the City Council nor any official executing this Agreement on behalf of the City or any present or future member, officer, agent or employee of the City or LCI shall be liable personally by reason of the covenants, obligations or agreements of the City or LCI contained in this Agreement. 5. Severabilitv. In case any section or provisions of this Agreement, or any agreement, obligation, act or action, or part thereof, made, assumed, entered into, done or taken under this Agreement, or any application thereof, is held to be illegal or invalid for any reasons, or is inoperable at any time, that illegality, invalidity or inoperability shall not affect the remainder of this Agreement or any other section or provision of this Agreement or any other agreement, obligation, act or action, or part thereof, made, assumed, entered into, done or taken under this Agreement, all of which shall be construed and enforced at the time as if the illegal, invalid or inoperable portion were not contained therein. Any illegality, invalidity or inoperability shall not affect any legal, valid and operable section, which shall be deemed to be effective, operative, made assumed, entered into, done or taken in the manner and to the full extent permitted by law from time to time. 6. Assignments. Except for any assignment to an "affiliate" or "subsidiary" (each as hereinafter defined), LCI agrees not to assign this Agreement without the prior written consent of the City, which consent shall not be unreasonably withheld, conditioned or delayed. In the event of an assignment of this Agreement to a subsidiary or affiliate, no consent shall be required; provided, however, that LCI shall give the City written notice of that assignment not less than ten (10) days prior to the effective date thereof. For the purposes of this Section 6, "affiliate" or "subsidiary" shall mean a corporation or entity which shall be directly or indirectly -3- controlled, under the control of, or be under common control with LCI. For purposes hereof, "control" shall be deemed to mean ownership of more than fifty percent (50%) of the outstanding voting stock of a corporation or other majority equity and controlling interest if not a corporation. 7. Successors. This Agreement shall be binding upon LCI and its beneficiaries, successors and assigns. 8. Amendments. This Agreement may only be amended by written instrument executed by all of the Parties to this Agreement. 9. Notices, All notices, requests or other communications hereunder shall be sufficiently given and shall be deemed given when mailed by registered or certified mail, postage prepaid, addressed to: (a) To LCI at: LCI International Management Services, Inc. 4650 Lakehurst Court Dublin, Ohio 43017 Attention: Manager Land and Buildings Copy: Legal Department with a copy to: LCI International Management Services, Inc. 4650 Lakehurst Court Dublin, Ohio 43017 Attention: Legal Department (b) To the City at: Department of Development City of Dublin 5800 Shier-Rings Road Dublin, Ohio 43017 Attention: Director of Development The Ciry or LCI may, subsequent to the provision of proper notice, designate any further, different or more specific addresses to which mailing shall be sent. 10. Counterparts. This Agreement may be signed in one or more counterparts or duplicate signature pages with the same force and effect as if all required signatures were contained in a single original instrument. Any one or more of such counterparts or duplicate signature pages may be removed from any one or more original copies of this Agreement and annexed to other counterparts or duplicate signature pages to form a completely executed original instrument. -4- IN WITNESS WHEREOF, the Parties have executed this Agreement by their duly authorized officers effective as of the day and date specified above. LCI INTERNATIONAL MANAGEMENT SERVICES, INC. By: Title: CITY OF DUBLIN, OHIO By: Timothy C. Hansley, City Manager And by: Marsha I. Grigsby, Director of Finance Approved as to Form: Director of Law -5- CERTIFICATE As the Director of Finance of the City of Dublin, I certify that the money required to meet the obligations of the City of Dublin during the year 1997 under the attached Agreement has been lawfully appropriated by the Council of the Ciry for those purposes and is in the treasury of the City or in the process of collection to the credit of an appropriate fund, free from any previous encumbrances. This Certificate is given in compliance with Sections 5705.41 and 5705.44 of the Revised Code. Dated: 1997 Director of Finance City of Dublin, Ohio -6- STATE OF OHIO ) SS: COUNTY OF FRANKLIN ) The foregoing instrument was acknowledged before me this day of ,1997, by ,a of LCI International Management Services, Inc. , which executed such instrument on behalf of said corporation. ... Notary Public STATE OF OHIO ) SS: COUNTY OF FRANKLIN ) The foregoing instrument was acknowledged before me this day of 1997, by Timothy C. Hansley and Marsha I. Grigsby, the City Manager and Director of Finance, respectively, of the City of Dublin, Ohio, a municipal corporation, on behalf of said municipal corporation. Notary Public -7- ~_ r:.. ~...,, ,~ EXHIBIT A-1 Depiction of the Property EXHIBIT A-2 Description of the Property EXHIBIT B Duke Improvements The private improvements to be constructed by Duke Realty Limited Partnership are afive-story 156,000 square foot corporate office building to be located on approximately 10 acres of land located at 6000 Parkwood Place, Dublin, Ohio. Those improvements include all site work, on- site storm water management work, sub-base and pavement of parking lots and driveways, all structural steel, concrete, glass, architectural precast, etc. for the building. The improvements also include all electrical, plumbing, HVAC and mechanical units, and fire protection, and all related architectural and engineering design, building permits, tap fees and related costs. ~.**