Loading...
HomeMy WebLinkAbout1983-030-02/01/1983-AUTHORIZING THE CITY MANAGER TO EXECUTE A MODIFICATION AGREEMENT TO THE MASTER AGREEMENT WITH ANHEUS RESOLUTION 83- 30 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE CITY MANAGER TO EXECUTE A MODIFICATION AGREEMENT TO THE MASTER AGREEMENT WITH ANHEUSER-BUSCH, INC WHEREAS, on December 31, 1982 the City Manager entered into a Master Agreement on behalf of the City of Fort Collins with Anheuser-Busch, Inc for the provision of a brewery in the City of Fort Collins, and WHEREAS, further negotiations with Anheuser-Busch, Inc have made it necessary to prepare a modification agreement, amending certain provisions of the existing Master Agreement, and WHEREAS, Council deems it to be in the best interest of the City of Fort Collins to authorize the City Manager to execute a Modification Agreement with Anheuser-Busch, Inc NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the City Manager be, and he hereby is, authorized to execute on behalf of the City of Fort Collins the Modification Agreement to the Master Agreement Between the City of Fort Collins and Anheuser-BuscInc ate February , 1983 Passed and adopted at a regular meeting of the City Council held this 1st day of February, A D 1983 mayor ATTEST MODIFICATION AGREEMENT TO THE MASTER AGREEMENT BETWEEN THE CITY OF FORT COLLINS AND ANHEUSER-BUSCH, INCORPORATED February 1, 1983 MODIFICATION AGREEMENT THIS MODIFICATION AGREEMENT, made and entered into this day of , 1983, by and between ANHEUSER-BUSCH, INC , a Missouri Corporation having its principal place of business in St Louis, Missouri (hereinafter called "Com- pany" ) , and the CITY OF FORT COLLINS, a municipal corporation duly organized and existing under the laws of the State of Colorado (hereinafter called "City" ) , WITNESSETH WHEREAS , the parties hereto on December 31 , 1982 , entered into a Master Agreement (hereinafter referred to as "Master Agreement" ) , and WHEREAS , said Master Agreement contains Article VII entitled "Financing" and Article VIII entitled "General Conditions" and WHEREAS, the parties hereto desire to modify said Articles by amending certain portions thereof and adding thereto and WHEREAS, the parties hereto agree that they will mutu- ally benefit from the changes made to said Master Agreement NOW, THEREFORE, for and in consideration of the promises by the parties made herein and the benefits to be derived therefrom, said Master Agreement dated December 31, 1982, is hereby modified as follows MODIFICATIONS TO ARTICLE VII I Paragraph (b) of Section 1 of Article VII ( Capital Investments ) is_hereby_deleted_in its entirety and the following_Paragrap-h (b) is hereby substituted therefor "b) Capital Investments - City and Company anticipate that City will receive substantial tax revenues as a result of the acquisition of the Site by Company and construction by Company of the Plant and related facilities in City Such revenues will enable City to construct the general public improvements hereinbefore identified, all to the benefit of City In the event that such improvements or facilities described herein are constructed by City, City shall finance such improvements or facilities through bonds or other available methods of municipal financing as hereinafter referred to Company recognizes the benefits it will derive therefrom and its responsibility to bear its fair share of the costs of constructing and financing such facilities , and therefore agrees to pay to City a Supplemental User Fee in accordance herewith in addition to any and all other user fees as provided for in this Agreement Such Supplemental User Fee shall be paid on June 30th and December 31st of each applicable year, and each such payment shall be equal to all of City' s debt service payments made during the six (6) months immediately preceding each such payment date (other than payments made -2- from the proceeds of any financing) , to finance the costs of the public improvements referred to in Paragraph l (a) above W to the extent that such costs are incurred in accordance with the provisions of this Agreement (including, without limitation, the provisions of Article VIII, Paragraph 10(b) of this Agreement) and, (ii) to the extent of the Company' s share thereof , as shall be agreed by City and Company in accordance with said Article VIII, Paragraph 10(b) less, however, a sum equal to any monies received by City under the Base Formula (as hereinafter defined) during the six (6 ) months immediately preceding each such payment date, and, in the event that the aggregate Base Formula receipts in all periods prior to such six (6 ) month period shall exceed the aggregate of such debt service payments in all periods prior to each six (6) month period, then also less such excess The Supplemental User Fee shall be paid by Company in each year until Company' s share of debt service requirements are satisfied on the securities issued to finance the public improvements as are described in Paragraph l (a) above " II Section 2 of Article VII (Appropriations ) is hereby deleted in its entirety_and the following Section 2 is hereby substituted therefor -3- "2 APPROPRIATIONS Upon the execution of this Agreement by the parties, City shall forthwith commence all activities to the end that City may obtain funds necessary for all general public improvements and water rights acquisition as are described in this Agreement The parties agree that any provision of this Agreement calling for City' s expenditure of funds shall be effective only upon the appropriation of the funds necessary thereto where such funds are subject to appropria- tion under the laws governing the operation of City, and any provision of this Agreement which purports to obligate City' s Council to perform a specific legislative act shall not be effective until such legislative act is performed by the Council Upon such necessary appropriation or legislative act, the provision( s) of this Agreement dependent thereon shall be effective as if it had been effective as of the date of execution of this Agreement In the event that City' s Council fails to appropriate all necessary monies to make effective every provision of this Agreement dependent thereon within ninety ( 90 ) days of the date of this Agreement, Company may terminate this Agreement in its entirety at no cost to Company The foregoing shall in no way limit the obligations of City hereunder to provide the projects referred to herein once the required appropria- tion of funds has been made " -4- III Section 3 of Article VII ( Financing Structure) is hereby deleted in its entirety and the following Section 3 is hereby substituted therefor 19 3 FINANCING STRUCTURE a) Line of Credit - It is anticipated that the initial financing method to be utilized by City for the purpose of making appropriations in accordance with Section 2 of this Article will be a line of credit to be evidenced by bond anticipation notes ( BAN ' s) In order to facilitate such financing, it is anticipated that Company may provide undertakings to the purchaser of the BAN ' s , pursuant to which Company will provide additional assurances of payment to said purchaser In order to enable Company to limit the extent of its liability to such purchaser, it is agreed that (i) Prior to the delivery by Company to City of the initial notice to proceed in accordance with Article VIII , Paragraph 10 ( b) of this Agreement, advances under the BAN ' s shall be obtained by City in amounts sufficient to pay the customary and reason- able costs of issuance of the BAN' s (including, but not limited to, commitment fees, bond counsel fees, printing and publication costs ) and any required payments of accrued interest thereon, and no further advances shall be made -5- (11 ) Following the delivery by Company to City of the initial notice to proceed in accordance with Article VIII, Paragraph 10(b) of this Agreement further advances will be requested by City under the BAN ' s only ( 1 ) in accordance with the provision of sub- Paragraph 3 ( a) ( i) above, and ( 2 ) to pay the costs of acquisition and construction of projects hereunder in accordance with the said notices to proceed and other provisions of this Agreement City agrees to maxe all requests for advances to the pur- chasers of the Bond Anticipation Notes in written notice which shall also state the purposes of such advances and shall provide to Company copies of such requests at least ten (10) business days prior to the date for such advances Such notices to Company shall be sent in accordance with the provisions of Article VIII, Paragraph 10(a) b) Long Term Financing - Upon receipt of the initial notice from Company to City to proceed with the several projects to be undertaken by City as described in this Agreement, City will promptly make its best efforts to obtain long term financing for a term of not less than fifteen (15 ) years to refinance the existing BAN' s and to obtain such funds as may be required to complete all of such several projects City agrees to inform Company of its plans and expectations from time to time relating -6- r to such financing in accordance with Article VIII, Paragraph 10(b) of this Agreement c) Terms of Financing - City shall make its best efforts consistent with the Paragraph 3(b) above to issue bonds to finance its respective obligations hereunder in accordance with all applicable requirements of law and consistent with City' s customary sound financial practices in order to achieve the best terms therefor, including the lowest net interest costs and prior redemption premiums then obtainable Such financing will be structured in a manner similar to City' s customary financing for similar general public improvements , and shall be either general obligations of the City or obligations payable from specified revenues or funds received by City from the general public, which revenues may include revenues to be received from Company hereunder Company shall not be required to provide any undertaking or direct assurances of payment to the purchasers of any such long term bonds , except for its obligations to make payments to City as provided herein d) Financing Costs - It is recognized and agreed to by Company that City shall pay out of the proceeds of any financings obtained pursuant to Paragraph 3 (b) above the customary and reasonable financing costs and expenses, including, but not limited to, bond counsel fees, rating service fees, underwriting charges and printing and publica- tion costs -7- e) Obligation to Act in Reasonable Manner - City shall be obligated to act in good faith and in a reasonable manner in the acquisition, construction, financing, operation and maintenance of the facilities to be provided to Company under this Agreement, and in the allocation of costs to Company pursuant to this Agreement and to use its best efforts to maintain the costs of the various phases of the projects within the cost estimates and projections to be made available to Company pursuant to Paragraph 10(b) of Article VIII of this Agreement " IV A new Section 6 is hereby added to Article VII to read as follows "6 CONSULTING EXPENSES City and Company stipulate that preliminary to and during the course of negotiations necessary to this Agree- ment, City has incurred certain engineering expenses in the use of outside consultants Upon the execution of this Agreement, Company shall forthwith deposit with City an amount equal to the actual costs in such respect that City has incurred for such consulting expenses prior to the date of this Agreement provided, however, that in no event shall such deposit exceed the sum of Forty Thousand Dollars ($40,000) Such deposits of funds hereunder shall be refunded by City to Company upon, and only upon, Company' s -8- certification to City that fifty percent (50%) of the con- struction of the Plant has been completed " MODIFICATIONS TO ARTICLE VIII I Section 2 of Article VIII (Early Termination) is hereby deleted in its entirety and the following Section 2 is hereby substituted therefor 1.2 EARLY TERMINATION a) Lapse - Notwithstanding the provisions of Section 1 of this Article, this Agreement shall terminate and be of no further force or effect three (3) years from the date hereof unless Company gives notice to City pursuant to any individ- ual Section of this Agreement entitled 'Time of Performance" in Articles II through VI hereof b) At Company' s Option - At any time before or after having given notice to City as mentioned in Paragraph 2 (a) above, Company may terminate this Agreement at its sole option upon written notice to City c) Costs to Company - In the event that (1 ) this Agreement lapses pursuant to Paragraph 2 ( a) above , or ( 2 ) Company terminates this Agreement in accordance with Paragraph 2 (b) above before any notice as described in Paragraph 2 ( a) above is given to City, Company shall pay City for all of City' s costs for principal and interest -9- for any funds obtained by City pursuant to Article VII , Paragraph 3(a) of this Agreement in the event that Company terminates this Agreement in accordance with Paragraph 2 (b) above after having given any notice to City as described in Paragraph 2 (a) above, City shall prepay any indebtedness which City shall have incurred pursuant to the terms of Article VII and intended for Company ' s benefit with any appropriated unexpended proceeds to the extent that such proceeds allow Company shall reimburse City for all such reasonable costs and expenses of City, including any costs of City to terminate Company' s share of any pro3ect which may be under design or construction, and also Company' s share of all costs and expenses and debt service obligations (including the principal balance of the remaining indebtedness) paid by or accrued to City subsequent to the previous payment of a Supplemental User Fee paid by Company, and for and through (a) the date( s) City retires such indebtedness or, (b) thirty (30) days from the termination date of this Agreement, whichever shall occur first Such reimbursement shall be made within thirty (30) days after the termination date of this Agreement In the event that Company shall terminate this Agreement in accordance with this Paragraph at any time during which City remains under a continuing obligation to make payment against any indebtedness pursuant to Article III of this Agreement and not included under the provisions of -10- Article VII of this Agreement, City shall repay all indebted- ness incurred pursuant to such Article from any appropriated unexpended financing proceeds to the extent that such pro- ceeds allow and to the extent that such proceeds are not committed to be expended for projects under contract to be completed pursuant to this Agreement To the extent that City has committed such proceeds and prepayment of such indebtedness is inappropriate, Company shall continue, after such termination, to make payment to City of Company' s share of City' s indebtedness therefor Such continuing payments shall be made to City in conjunction with the payment sche- dule of City' s indebtedness and each such payment as may be related to such improvements constructed shall be in an amount based on the idle capacity as same may exist from time to time, of such improvements , or any of them, as were intended for Company' s benefit d) Termination Caused by Breach - Company shall be under no obligation to make any such payments subsequent to the termination of this Agreement if termination by Company results from a substantial breach by City of any material term hereof provided, however, that prior to payment, redemption or refunding in full of the BANs referred to in Article VII , Paragraph 3 ( a) hereof, Company shall in all events be required to continue making payment of Supplemental User Fees pursuant to Article VII of this Agreement to the -11- extent that such payments shall be payable to the holder or holders of such BANS, as assignees of the right of City to receive such payment The obligation of Company to continue such payments shall not affect or limit Company' s right to pursue any claim against City in respect of any default hereunder e) Continuation of Water Service - In the event of a termination of this Agreement for any reason, Company or its assignee shall continue to maintain its right to obtain treated water from City at normal City rates and charges for use upon the site in an amount equal to the waters provided pursuant to Article III, Section 5 of this Agreement, upon the condition that Company is not in default of any payment to be made for City' s indebtedness to obtain the water rights to serve Company according to the terms of this Agreement f) Obligation to Mitigate Costs - In the event that there should be a termination or modification of this Agreement after City shall have incurred expenses or made financial commitments in respect of any projects under this Agreement, and if, under the terms of this Article, Company shall have an obligation to reimburse City, directly or indirectly, for such expenses or commitments , or to make payments in respect of related debt service, City shall cooperate with Company and make every reasonable effort to minimize such obligations of Company, including, -12- without limitation, the negotiation of cancellation of uncompleted contracts, the retirement of obligations which may have been issued to finance the work which will not be completed and the reallocation of excess capacity to other users " II Section 10 of Article VIII (Notices) is hereby deleted in its entirety and the_followin_Section 10 is hereby substituted therefor "10 NOTICES a) General - Whenever notice is required or permitted hereunder from one party to the other, the same shall be in writing and shall be given effect by hand delivery, or by mailing same by certified or registered mail , to the party for whom it is intended Notices to City and Company shall be addressed as follows To City City of Fort Collins P 0 Box 580 Fort Collins, Colorado 80522 Attention Mr John E Arnold, City Manager To Company Anheuser-Busch, Incorporated One Busch Place St Louis, Missouri 63118 Attention Mr T R Montgomery, Vice President-Operations -13- Either party may at any time designate a different person or address for the purposes of receiving notice by so informing the other party in writing Notice by certified or registered mail shall be deemed effective 3 days after having been deposited in the United States mail (b) Notices Pursuant to "Time of Performance" Sections of Article II through Article VI of this Agreement - Notices to the City which are to be given by the Company under Articles II, III, IV, V, and VI of this Agreement in Sections thereof entitled "Time of Performance" may specify that City shall proceed to perform specific phases or items of the project or projects referred to therein, and City shall not be required or authorized to perform any greater portion of such project or projects than shall be indicated in such notices provided , however, that Company shall give its successive notices to continue with a particular project in such timely manner that the City may, after the initial notice is given for any project, complete such project within the time limit specified in the Sections and Articles re- ferred to above Without limiting the foregoing, Company may specify, as to any project, that ( i ) City shall proceed to the preparation of initial and/or final architectural and engineering plans and specifications , (ii) City shall solicit bids for all or a portion of the project, including financing, (iii ) City shall accept bids which have been -14- received for all or any portion of the project, or, (iv) City shall proceed to purchase specific equipment required for the project For the purpose of assisting Company in maxing determinations with respect to notices to be delivered under this Paragraph 10(b) , City shall consult with Company and make available to Company such information as Company may reasonably request relating to the several projects includ- ing, without limitation, its plans and specifications for the projects, construction and acquisition schedules, budgets and other cost information, bids, contracts and purchase orders, and shall also inform Company from time to time of City' s plans and expectations relating to the interim and permanent financing for the several projects With respect to any project requiring an allocation of costs hereunder, City and Company shall reach agreement as to such allocation thereof as between City and Company as soon as the plans and specifi- cations for the project are completed to the extent required for such determination " The parties hereto approve, ratify and affirm the terms of the Master Agreement dated December 31, 1982, except as said Master Agreement is amended by this Modification Agree- ment IN WITNESS WHEREOF, the parties hereto have executed -15- this foregoing Modification Agreement on the day and year first above written ANHEUSER-BUSCH, INCORPORATED By Vice President - Operations ATTEST Assistant Secretary CITY OF FORT COLLINS A Municipal Corporation By John E Arnold, City Manager ATTEST City Clerk APPROVED AS TO FORM City Attorney -16-