HomeMy WebLinkAbout2012-229 INDIAN RIVER COUNTY , FLORIDA o D la - cZa
CLOSING FUND AGREEMENT
AMENDMENT NUMBER ONE
This first Amendment to the INDIAN RIVER COUNTY, FLORIDA CLOSING FUND
AGREEMENT (entered into May 16, 2008) (hereinafter referred to as the "Indian River
Agreement") is made and entered into this 18thday of December, 2012, by and between Indian
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River County, a political subdivision of the State of Florida, hereinafter referred to as "County,"
and Piper Aircraft, Inc. , its successors and permitted assigns, hereinafter referred to as "Closing
Fund Awardee," pursuant to Section 125 . 045 , Florida Statutes . County and the Closing Fund
Awardee are sometimes also hereinafter referred to as a "Party" and collectively as the "Parties . "
This Amendment is entered into for the purpose of modifying the Indian River
Agreement in part in light of Amendment Number One of the Quick Action Closing Fund
Agreement between the State of Florida, Department of Economic Opportunity' s Division of
Strategic Business Development, and to modify the award and performance conditions contained
in the Indian River Agreement to reflect the County' s reclamation of $ 8 ,000,000 (out of
$ 12,000,000) originally eligible to be awarded to the Closing Fund Awardee and to provide for
the Closing Fund Awardee ' s retention of the previously disbursed Closing Fund Award payment
($4,000,000), provided that the terms of this Amendment are satisfied.
The Parties wish to amend the Indian River Agreement to ensure that the terms of the
Indian River Agreement comply with current law and procedures. The number of jobs to be
created and the funding amount the Closing Fund Awardee is eligible to receive are modified by
this Amendment, but the average annual wage, required capital investment, and contract term
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remain the same as specified in the original agreement executed on May 16, 2008 except as
modified herein.
In consideration of the mutual promises and agreements contained herein, the Parties
agree to amend the Indian River Agreement as follows .
1 . General Purpose of Amendment : Under the original Indian River Agreement,
Closing Fund Awardee was eligible to receive three Closing Fund Awards, each in the amount of
$4,000,000, for a total of $ 12 ,000 ,000 . Closing Fund Awardee received the first payment in
2008 ; however, Closing Fund Awardee did not apply for or receive the second or third payments.
The general purpose of this amendment is to establish that:
(a) County shall no longer have any obligation to pay, and Closing Fund
Awardee shall no longer have any entitlement to receive, the second and third Closing Fund
Awards (totaling $ 8 ,000,000), which are hereby released from any further commitment or
obligation under this Agreement,
(b) In recognition of the fact that Closing Fund Awardee (i) has continued to
operate and provide important jobs in Indian River County, despite a very difficult local, national
and international economy, and (ii) has met the capital expenditure, product development and
average wage requirements, as set forth in the original Indian River Agreement, only $2,000,000
of the first Closing Fund Award of $4,000,000 shall remain subject to sanction. The $2 ,000,000
of the first Closing Fund Award which no longer remains subject to sanction shall be retained by
Closing Fund Awardee without further commitment or obligation, with respect to such amount,
under this Agreement,,
(c) The $2,000,000 of the first Closing Fund Award which remains subject to
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sanction shall be subject to sanction on the basis of four separate performance evaluation dates
(December 31 , 2012 , 2013 , 2014 and 2015) on each of which a total amount of $ 500,000 shall be
subject to sanction, as set forth herein, and
(d) Closing Fund Awardee reaffirms its intent and commitment to remain in
Indian River County and to achieve the job levels and other performance standards, as set forth
herein.
2. Section 2.0 is deleted and replaced by the following:
2 .0 ADMINISTRATORS :
County' s Closing Fund Agreement administrator is ,
Joseph A. Baird, County Administrator,
The Closing Fund Awardee Agreement administrator is .
John Calcagno , Chief Financial Officer or his successor.
All approvals and notifications referenced in this Agreement must be obtained in writing
from the parties ' agreement administrators or their duly authorized designees .
3 . Section 5.0 is deleted and replaced by the following:
5 . 0 PROJECT DESCRIPTION AND AWARD CONDITIONS ,
(a) Project Description. This Project (as such term is used herein) will include
the retention and expansion of the Closing Fund Awardee ' s facilities and operations in Vero
Beach, Indian River County, Florida, as described in "Exhibit A," including the design,
development, and production and/or assembly of aircraft projects resulting in the job levels and
capital investment contemplated by this Agreement.
(b) Award and Performance Conditions for Retention of Award Funds . The
following "Award Conditions" and "Performance Conditions" must be met for Closing Fund
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Awardee to retain all of the $2 ,000,000 of the first Closing Fund Award which remains subject to
sanction under this Amendment. The Award and Performance Conditions contained herein are
subject to sanctions for non-performance as provided in this agreement.
( 1 ) Retain at least 600 full-time equivalent jobs at the Vero Beach,
Indian River County, Florida facility, and provide documentation of these jobs reasonably
acceptable to County. These full-time equivalent jobs shall be retained through December 31 ,
2015 .
(2) The Agreement required Closing Fund Awardee to make capital
investments (including product development expenditures) in tooling, equipment, product
development, and facility and infrastructure improvements at the Vero Beach facility since April
10, 2007, of a cumulative total of at least $45 million by December 31 , 2013 , and $65 million by
December 31 , 2015 . The parties acknowledge that this investment requirement has been satisfied,
inasmuch as Closing Fund Awardee has to date made capital investments (including product
development expenditures) of approximately $97 million in tooling, equipment, product
development, and facility and infrastructure improvements at the Vero Beach facility since April
10, 2007 .
(3 ) Pay average annual wages for the jobs specified in Paragraph
5 . 0(b)( 1 ) of at least $46, 500, excluding benefits.
(c) Extension Option, Closing Fund Awardee has already exhausted its
extension options . No further extensions shall be allowed under this agreement.
4. Section 7.0 is hereby deleted and replaced by the following.
7 . 0 DUTIES OF THE CLOSING FUND AWARDEE : The Closing Fund Awardee
agrees that to retain the $2 ,000,000 of the first Closing Fund Award which remains subject to
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sanction, the Closing Fund Awardee must .
(a) Undertake the Project and meet all of the Award Conditions and
Performance Conditions as specified in Paragraphs 5 . 0 of this Amended Agreement, as
applicable.
(b) Submit annual certification of its employment and annual average wages
paid using a Qualified Target Industry Tax Refund (QTI) Claim application form, or alternate
equivalent documentation reasonably acceptable to County, every State of Florida fiscal year by
January 31 of said year for the performance as of the prior December 31 . The QTI claim
application, or alternate equivalent documentation of performance, must be submitted annually
through January 31 , 2016 , under the terms of this renegotiated agreement.
(c) For each investment performance specification in Paragraph 5 . 0(b)(2),
maintain, to the extent commercially reasonable, such capital investment (such as tooling,
equipment, and facility and infrastructure improvements) , in Indian River County through
December 31 , 2015 , and certify and submit documentation that such capital investment continues
to be located in Indian River County as of December 31 , 2015 . This provision shall not prevent
the Closing Fund Awardee from disposing of any assets no longer useful to the Project, so long
as the Closing Fund Awardee does not remove that equipment from Indian River County for the
purpose of operating in another location.
(d) Certify and submit documentation to support the fulfillment or
substantiation of the certifications specified in Paragraph 5 . 0 .
(e) Notify County in writing of any material developments that impact the
implementation or operation of this Agreement or the Project. Such material developments will
include, but not be limited to, announcements with regard to the Project, cancellation of the
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Project, major announcements with respect to aircraft, layoffs, or majority change in ownership
of the Closing Fund Awardee.
(f) Maintain personnel and financial records and reports related to the jobs,
wages, cumulative capital investment, and product development activities and expenditures
related to the Project and to decisions of the Board of Directors associated with their
commitments to the Project, and submit reports to County as reasonably requested, which records
and reports shall, to the extent permitted by law, be held confidential as authorized in Sections
288 . 0759 288 . 1067, and 288 . 9520, Florida Statutes, or any other applicable statutes.
5 . Paragraphs 9.0, 10(b), 10 .0(c), 10.0(d), 10.0(e), 10.0(f), 10.0 (g), 10 .0(h), 10.0(1)9
and 10 .00) are hereby deleted and replaced by the following:
9 . 0 Intentionally omitted .
10 . 0 [ . . . ]
(b) In the event the Closing Fund Awardee ceases substantially all operations
at the project site at any time before the conclusion of the Agreement (as amended), the Closing
Fund Awardee will be immediately obligated to repay the outstanding portion of the $2 ,000,000
of the first . Closing Fund Award which, at the time of cessations of such operations, remains
subject to sanctions, plus any interest penalty.
(c) In any year (determined as of December 31 , 2012, 2013 , 2014 and 2015 )
the Closing fund Awardee achieves all performance conditions as set forth in Paragraph 5 (b)( 1 ),
(2) and (3 ), and performs all duties set forth in Paragraph 7 , a portion of the first Closing Fund
Award of $2 ,000,000 which remains subject to sanction, which portion shall be in the amount of
$ 500,000, shall be permanently removed from the scope of this Agreement, shall be retained by
Closing Fund Awardee and shall no longer be subject to sanction.
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(d) In any year (determined as of December 31 , 2012 , 20139 2014 and 2015)
the Closing Fund Awardee does not achieve its FTE job-maintenance commitment of 600,
Closing Fund Awardee shall be required to pay the County the sum of $ 500, 000, plus interest, as
determined in Paragraph 10 . 0(g) of this Agreement, on the amount repaid.
(e) In any year (determined as of December 31 , 2012, 2013 , 2014 and 2015)
the average wage falls below the average wage required by Paragraph 5 . 0(b)(3 ) of this
Agreement, the Closing Fund Awardee shall pay the County the sum of $ 500,000, plus interest,
as determined in Paragraph 10 . 0(g) of this Agreement, on the amount repaid.
(f) In any year (determined as of December 31 , 2012 , 2013 , 2014 and 2015)
the Closing Fund Awardee fails to maintain, to the extent commercially reasonably, the location
of the capital investment (such as tooling, equipment, and facility and infrastructure
improvements) in Indian River County required by Paragraph 7 . 0(c) of this Agreement, the
Closing Fund Awardee shall pay the County the sum of $ 500,000, plus interest, as determined in
Paragraph 10. 0(g) of this Agreement, on the amount repaid.
(g) The interest rate shall be determined by the annualized average interest
rate earned by the County on funds invested by the County (schedule to be provided by the
County) on December of the year in which the performance standard was not met by the
Awardee. Additionally, the same interest penalty may be imposed for any period for which the
required performance report is overdue, or during which period the Closing Fund Awardee, after
being notified by County in writing of any inadequacies in the performance report and/or the
supporting documentation and being provided a 60-day period to cure any such inadequacies, has
failed to correct the specified inadequacies . Interest shall be calculated from the last date of the
quarter with respect to which it is determined that the performance standard was not met.
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(h) In no year shall the amount required to be repaid . exceed $ 500,000 , plus
interest. For example, if the Closing Fund Awardee fails to meet the tests both in Paragraphs
10. 0(d) and (e) for calendar year 2012, the sanction would be $ 500, 000, not $ 1 million.
(i) The Closing Fund Awardee shall have 60 days to cure any alleged breach
of this Agreement; provided, however, that nothing herein shall extend any date required to meet
a Performance Condition as set forth in Paragraph 5 . 0(b) . Any required repayment, interest
and/or penalty, is due to County within sixty (60) days of receipt of written notice from County,
after which additional interest at the rate determined in Paragraph 10. 0(g) of this Agreement,
shall begin to accrue on the repayment amount due, including any interest on that amount, as
determined in Paragraphs 10. 0(d), (e) , or (g) . However, such repayment and interest shall not be
due, nor any additional interest accrue on the repayment and interest due, until any appeal of
County' s decision shall have been completed in accordance with Section 16 . 0 hereof.
(j ) County, or its designated agent, may, with reasonable notice of no earlier
than 10 business days, conduct on-site visits to the Indian River County facilities to verify the
Closing Fund Awardee ' s capital investment and product development, employment, and wage
records .
6. This Amendment is not intended to increase the maximum amount that may
be paid to the Closing Fund Awardee under the original Indian River Agreement.
7. The Parties reaffirm all portions of the Indian River Agreement not in
conflict with this Amendment. Performance in accordance with this Amendment will be
considered performance of the Indian River Agreement. In the case of any conflict between
the Agreement and the Indian River Amendment, the Amendment shall control.
DUPLICATE ORIGINALS : This Amendment is executed in duplicate originals .
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IN WITNESS WHEREOF, County and the Closing Fund Awardee have caused this
Amendment to be executed and delivered by their duly authorized representatives.
J. R . SMITH if
ATTEST . CLERK CIRCUM COURT BOARD OF COUNTY COMMISSIONERS
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• INDIAN RIVER COUNTY, FLORIDA
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Deputy Clerk ■fn•yT"
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Pf
eph . Flescher, Chairmmban
i s 2012 .00roved b BCC : nPrP1'
Approved : °+,;q� o , , R COpproved as to form and legal sufficiency:
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hoseph Aq.Vaird, County Administrator Alan S . Polackwic . , ount Attorney
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Witnesses :
rint name . E eL
Print name : Ter rl A nj 1 ss1i[ ►/
PIPER AIRCRAFT, INC .
("Closing Fund Awardee")
By:
Authorized Signature
Date : � c c1.w► • % ) 'ZO � 'L,
Title : President and CEO
List of Exhibits :
Exhibit 1 Original Quick Action Closing Fund Agreement
Exhibit 2 Special Audit Requirements
Exhibit 3 Criteria for Measurement of Achievement of Terms for New Full Time
Equivalent Jobs and Average Annual Wage (where applicable)
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