WHEREAS, N.C.G.S. 158-7.1(b) lists specific economic development activities which a county may undertake, which list is not exclusive; and
WHEREAS, the Company contemplates purchasing certain real estate consisting of approximately 80 acres and located within the Research Triangle Park in the County; and
WHEREAS, the Company will construct facilities at said location (the "Facilities") which will require site improvements, construction of buildings, and installation of machinery and equipment to accommodate the Company's operations; and
WHEREAS, the Board of Commissioners of the County has determined, following a public hearing on November 15, 2004 that the proposed activity by the Company will tend to increase the population, taxable property base and business prospects of the County, and will encourage the Company to locate in the area, and that it is in the public interest to provide assistance, as authorized by N.C.G.S. 158-7.1; and
WHEREAS, the grant payments by the County will allow Company to qualify for matching funds from the State of North Carolina as part of the One North Carolina Fund; and
WHEREAS, the County is entering this Agreement based on the Company's ability to qualify for matching funds from the State of North Carolina as part of the One North Carolina Fund; and
WHEREAS, the grant payments will assist the Company in qualifying for funds from the State of North Carolina as part of the One North Carolina Fund; and
WHEREAS, the County Board of Commissioners finds that the consideration the County will receive, based on prospective tax revenues to be generated over an eight year period (commencing with the 2007 fiscal year) will exceed the amount of the grant offered herein; and
WHEREAS, N.C.G.S. § 153A-449 authorizes the County to contract with and appropriate money to any person, association, or Company in order to carry out the public purpose that the County is authorized by law to engage in.
NOW, THEREFORE, in consideration of the promises and other considerations, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Real Estate Purchase, Construction, and Machinery and Equipment Acquisition. The Company shall produce deed, title and/or other legal instruments showing proof of ownership of the Facilities; documentation for improvements which have been made to the real estate; and, receipts showing proof of acquisitions of machinery and equipment for the Facilities, for the purpose of operating a global business service center. Such premises to be improved in accordance with the following:
a. Investment in Real Estate Improvements and Equipment.
Investments for the improvements to the real estate and acquisitions for machinery and equipment shall total at least $100,000,000 and shall have occurred on or before December 31, 2007.
b. Employment. The Company shall provide the number of jobs and at the average annual salaries in accordance with the criteria set forth in
Sections 1.2 and 1.3 of the "One North Carolina Company Performance Agreement" entered into between the Parties and dated effective as
of October 20, 2004.
c. Use. The improvements shall be made to accommodate the intended purpose as follows: global business center.
d. Payment of Taxes by Company. The County must receive confirmation from the Wake County Tax Assessor's Office that the Company
has paid, in full, its annual taxes based on the increased value resulting from the new capital investment.
3. Documentation from the Company. In connection with each request for reimbursement, the Company shall deliver to the County's Finance Director a performance letter certifying that (1) it has undertaken the acts enumerated in Section 2 for the applicable phase; (2) it has completed the improvements described in Section 2 for the applicable phase; and (3) that at the date of the letter, the Facilities have been substantially completed, a Certificate of Compliance has been issued therefore, and are in operation with no reduction in the number of new positions, wages, and benefits as set forth in Section 2. If the Company does not meet all of the conditions required to be certified in the performance letter, it shall qualify for no reimbursement for that year. Upon the request of the County's Finance Director, the Company shall present to the County such evidence as may be reasonably requested to confirm the facts in the performance letter, especially those relating to employment. To the full extent allowed by law, such requested evidence shall be kept confidential and shall remain the property of the Company to be returned after the County's review.
It is agreed that the County, through its auditors, shall have the right upon reasonable notice and during normal business hours, to inspect, audit, examine and copy Company records pertaining to capital expenditures made in respect of the Facilities and the wages paid to Company's employees. All records revealed by the Company to the County's internal or external auditors shall remain confidential and may be used by the County only for audit purposes to the full extent allowed by law.
The County acknowledges that some or all of the information made available by the Company to the County pursuant to this section may be considered "Trade Secrets" pursuant to North Carolina General Statutes §132-1.2 and that any such information is proprietary. All information made available to the County pursuant to this section is hereby expressly designated as confidential and as a trade secret, regardless of whether such information is stamped, labeled or declared to be so at the time of disclosure to the County, unless the Company specifically waives confidentiality for such information at the time of disclosure. The County, to the extent allowed by State law, will hold such information as confidential. The County shall, if it receives a request for disclosure of any such information, notify the Company of such request so that the Company may defend any claims or disputes arising from efforts of others to cause such trade secrets to be disclosed as a public record. The Company shall have the right to direct any litigation of such dispute and shall indemnify the County for any legal fees and expenses incurred by the County in opposing such request for disclosure.
4. Payment of Grant.
a. The County agrees to partially reimburse the Company for the costs of these improvements, capital expenditures and provide an incentive to the Company for creating jobs within the County. A cash grant will be paid to the Company for the above-described costs in an amount equal to a percentage of the taxable property base of the personal property and improvements to real property of the Facilities as determined by the Wake County Tax Assessor as more specifically set forth in Section 4.c.
b. Once the Company has met the performance requirements set forth in Section 2 and has submitted the required documentation under
Section 2 and has submitted the required documentation under Section 3, it shall be eligible to receive the grant payments described herein.
The grant payments shall begin in 2008 provided that the taxable property base of the personal property and improvement to real property of the
Facilities as determined by the Wake County Tax Assessor exceeds 100,000,000 (exclusive of land value) as of January 1, 2007. (Otherwise,
the grant payments shall begin the year after the taxable property base of the personal property and improvement to real property of the
Facilities as determined by the Wake County Tax Assessor first exceeds $100,000,000). The exact date of payment during the year shall be at
the discretion of the County but shall be made during the period of January 1 through March 31.
c. The amount of the grant payment to be paid by the County to the Company shall be 2.25% of the assessed value of improvements to real
property and personal property associated with the Facilities, paid over a period of eight years. In the first year the grant payment shall be
equal to .5% of the assessed value of the personal property and improvements to real property of the Facilities. Thereafter, for seven
consecutive years, the County shall pay an annual grant payment to the Company equal to .25% of the total amount of the assessed value
of the personal property and improvements to real property of the Facilities as of January 1 of the preceding calendar year. At its option the
Company may elect to receive a grant payment based on .5% of the assessed value of the Facilities in a year designated by the Company
that is subsequent to the first grant payment year, in no event shall the grant amount paid by the County in any year exceed the amount of
ad valorem taxes paid by the Company on the assessed value of the personal property and improvements to real property of the Facilities
in that calendar year.
5. One North Carolina Fund. This Agreement is expressly contingent on the Company's ability to qualify for matching funds from the State of North
Carolina as part of the One North Carolina Fund. The County has the right to withhold payment for any calendar year in which the Company does
not qualify for One North Carolina Fund monies.
6. Amendments to Agreement. This Agreement can be modified or amended only with the mutual written consent of both parties.
7. Parties. This Agreement shall be binding upon and shall inure to the benefit of the parties and their heirs and successors and assigns. As used herein, words in the singular include the plural and the masculine includes the feminine and neuter genders, as appropriate.
8. Entire Agreement. This Agreement contains the entire agreement of the parties and there are no other representations, inducements, or other provisions other than those expressed in this writing. All changes, additions, or deletions hereto must be in writing and signed by all parties.
9. Laws of North Carolina To Control This Agreement. The parties agree that this Agreement is to be controlled by the laws of the State of North Carolina.
10. Attorneys Fees: Jurisdiction. In the event that either party seeks to enforce the provisions of this Agreement through legal action, the breaching party agrees to pay, in addition to any penalty payments, legal fees, including but not limited to reasonable attorney fees, filing fees, and other costs associated with litigation. Any controversy or claim arising out of this Agreement shall be settled by an action initiated in the appropriate division of the General Court of Justice in Wake County, North Carolina.
11. Termination. This Agreement shall terminate on the later of: (i) December 31, 2015 or (ii) December 31 of the last year in which the County makes grant payments to the Company hereunder.
12. Assignment. The Company may assign all or part of its rights and/or obligations under this Agreement to one or more affiliates designated by the Company.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be fully executed as of the date and year first above written.
CREDIT SUISSE FIRST BOSTON
WHEREAS, the Applicant has applied for a One North Carolina Fund grant from the North Carolina Department of Commerce (the "DOC"); and
WHEREAS, the Grant award has been approved by DOC pursuant to a One North Carolina Fund Local Government Grant Agreement with the Applicant (the "LGGA"); and
WHEREAS, the Grant award is to be used by the Company toward the goal of creating 400 new jobs and at least $120 million in new investment in the State of North Carolina; and
WHEREAS, the Grant is necessary to enable the investment and job creation by the Company to occur and go forward in North Carolina;
WHEREAS, the Grant is issued pursuant to and subject to the purposes and terms of N.C. Gen. Stat. § 143B-437.70 et seq. and the Program Guidelines;
NOW, THEREFORE, in consideration of the representations set forth above and the mutual covenants and promises set forth below, the Company and the Applicant hereby agree as follows:
1.0 PERFORMANCE CRITERIA
1.1 The Company agrees to make good faith efforts to undertake and operate in a timely manner the following project at the following location.
The establishment of a global business center facility (the Facility") to be located at or in the vicinity of the Cisco Systems campus in or near the Research Triangle Park in Wake County (the "Project").
1.4 The Company agrees to provide health insurance in at least the minimum amount required for eligibility for tax credits under the William S. Lee Act in G.S. 105-129.4(b2) as the Act existed on the date of this agreement.
1.5 The Company agrees to make good faith efforts to make a privately funded investment in real property and/or machinery and equipment as part
of the Project (the "Required Investment"), which will amount to at least $120 million by December 31, 2007.
1.6 The parties acknowledge and agree that the Company may perform some of its obligations under this Agreement acting through one or more
of its related members.
1.7 The proceeds of the Grant may be used only to offset statutorily qualifying expenses. Those expenses include installation or purchase of equipment; structural repairs, improvements, or renovations of existing buildings to be used for expansion; and construction of or improvements to new or existing water, sewer, gas or electric utility distribution lines, or equipment for existing buildings; as well as construction of or improvements to new or existing water, sewer, gas or electric utility distribution lines, or equipment to serve new or proposed industrial buildings used for manufacturing and industrial operations; or such other provisions as may be specified in statutory language authorizing the use of the funds.
1.8 Release of any Grant funds under this Agreement is contingent on the Company providing verification that the Project has received all of its required environmental permits.
2.0 DISBURSEMENT OF GRANT
2.1 Proceeds of the Grant in the amount of Three Million Dollars ($3,000,000.00) will be disbursed by DOC to the Applicant in four installments based on creation and maintenance of the New Jobs and satisfaction of other Performance Criteria set out in Section 1.0 above ("Performance Criteria"). Disbursement will occur on the following schedule and will be subject to any adjustments required by this Agreement:
a. The first twenty-five percent (25%) of the funds will be disbursed to the Applicant upon proof that the Company has created and retained not less than twenty-five percent (25%) (100) of the New Jobs, has made statutorily qualifying expenses in the amount to be disbursed, and has obtained all required environmental permits.
(i) The date as of which DOC shall have received and accepted proof reasonably satisfactory to it that the Project has been completed and the Performance
(ii) December 31,2007.
Following Closeout, to the extent any Grant proceeds may be due and upon the Applicant's request, a final payment of those funds will be disbursed. A request for final payment, if not made previously, must be made to DOC within 30 days following Closeout.
3.0 OBLIGATION TO REPAY DURING GRANT PERIOD
3.1 If, at any time during the Grant Period, the Company fails to provide health insurance in the amount required for eligibility for tax credits under the William S. Lee Act in G.S. 105-129.4(b2), the Company will be in default of this Agreement and will reimburse DOC the total amount of the Grant funds disbursed by DOC to the Applicant.
4.0 OBLIGATION TO REPAY AT CLOSEOUT
4.1 If, at Closeout, the average weekly wage of the group of all permanent full-time jobs at the Facility fails to exceed $1,107.00 per week, the Company will be in default of this Agreement, no final payment will be made and the Company will reimburse DOC the total amount of the Grant funds disbursed by DOC to the Applicant.
5.0 ADJUSTMENTS TO GRANT AT CLOSEOUT
5.1 If Closeout occurs on December 31, 2007 and the Company has failed to create and retain 80% of the New Jobs, has failed to make 70% of the Required Investment, or has failed to make statutorily qualifying expenses equal to 100% of the Grant, the amount of the Grant shall be reduced to the smallest of the following amounts ("the Adjusted Grant'):
c. The amount of statutoriiy qualifying expenses that the Company has made.
5.2 To the extent the amount of the Adjusted Grant is less than the amount that has been previously disbursed to the Company, the Company shall
reimburse DOC for the difference between the Adjusted Grant and the amount previously disbursed.
6.0 OBLIGATIONS BEYOND CLOSEOUT
6.1 If Closeout occurs before December 31, 2007, the Company will maintain at least ninety percent (90%) of the number of permanent full-time
jobs in place at Closeout for five years after the date of Closeout.
6.2 If Closeout occurs on December 31,2007, the Company will maintain at least ninety percent (90%) of the number of permanent full-time jobs in place at Closeout until December 31, 2012.
6.3 If the Company fails to maintain al least ninety percent (90%) of the number of permanent full-time jobs in place at Closeout for the required
time period following the date of Closeout, the Company will be default of this Agreement and shall reimburse to DOC the total amount of the Grant
funds disbursed by DOC to the Applicant.
7.0 ADDITIONAL PROVISIONS
7.1 The Company will provide to DOC and the Applicant all documentation deemed necessary by DOC or the Applicant to verify creation and
retention of the jobs specified in this Agreement including, without limitation, copies of the N.C. Employment Security Commission worksite forms
described in the One North Carolina Fund Program Guidelines, an annual list of all positions used in the accounting for the Grant and the names of
the individuals filling those positions. The Company will also provide to DOC and the Applicant all documentation deemed necessary by DOC or
the Applicant to verify the salary levels, investments, statutorily qualifying expenses, environmental permits and other Performance Criteria
specified in this Agreement. The Company's compliance with the job creation and/or retention, investment, statutorily qualifying expense,
environmental permit and other Performance Criteria set out in this Agreement shall be attested to by an officer of the Company.
7.2 If unforeseen calamity, an Act of God, or financial disaster is the cause of the Company's failure to satisfy or perform its obligations under this
Agreement, the Company and the Applicant may request an extraordinary modification of this Agreement from the Secretary of DOC. The parties
agree that any decision to allow such modification shall be at the sole discretion of the Secretary of DOC and that the Secretary's decision
regarding any extraordinary modification shall be final and not subject to review or appeal.
7.3 Each party shall keep and maintain books, records, and other documents relating to the receipt and disbursement of Grant funds and fulfillment
of this Agreement, including, but not limited to, records to verify employment, salaries, investment amounts, statutorily qualifying expenses and
If the Company fails to keep and maintain books and records necessary for verifying fulfillment of this Agreement, including, but not limited to,
adequate records for the verification of employment, salaries, investment amounts, statutorily qualifying expenses and environmental permits, the
Applicant or the Secretary of DOC may in its or his discretion declare this Agreement to be in default, withhold payments for or under this
Agreement or the LGGA, and/or require reimbursement of all or any portion of Grant funds previously paid.
Prior to taking such action, the Applicant or the Secretary of DOC will endeavor to communicate with the Company to discuss the circumstances and the actions being contemplated.
7.4 Subject to any applicable federal or North Carolina laws or regulations respecting employee privacy, each party agrees that any duly authorized representative of the Applicant or DOC shall, at all reasonable times and on reasonable notice, have access to and the right to inspect, copy, audit, and examine ail of the relevant books, records, and other documents relating to the Grant and the fulfillment of this Agreement throughout the Grant Period and for a period of six years thereafter.
To the extent any information or documents gathered pursuant to this section would be regarded as confidential or not subject to disclosure under federal law or the North Carolina General Statutes (to include, without limitation, N.C. Gen. Stat. §§ 132-1 et seq., commonly referred to as the "Public Records Act",), the Company shall clearly identify and mark them as such and that information will, to the extent allowed by law, be treated as confidential and not subject to disclosure by the Applicant and DOC and their authorized representatives.
If the Company fails to provide such access and right of inspection the Applicant or the Secretary of DOC may exercise discretion to declare this Agreement in default, to withhold payments under this Agreement and/or require reimbursement of all or any portion of One North Carolina Fund Grant funds paid.
7.5 Notwithstanding anything herein to the contrary, the parties hereto acknowledge the due execution of the LGGA and agree that any conflict
between the provisions, requirements, duties, or obligations of this Agreement and the LGGA shall be resolved hi favor of the LGGA. The parties
further agree that any conflict between the provisions, requirements, duties, or obligations of this Agreement and any program documentation for
this Grant shall be resolved in favor of this Agreement.
7.7 The Company shall perform and abide by all commitments identified in its application to DOC ("Company Application). The Company's
commitments in the Company Application are incorporated herein by reference, as if set out in full. The parties agree that any conflict between the
provisions of this Agreement and any commitments made in the Company Application to DOC shall be resolved in favor of this Agreement.
7.8 The representations made by the Company in the Company Application to DOC or as part of the application process are incorporated herein
by reference and deemed by the parties to be material to this Agreement. The parties agree that any conflict between any representations
contained in this Agreement and those representations contained in the Company Application to DOC or made as part of the application process
shall be resolved in favor of this Agreement.
7.9 If the Company has an overdue tax debt owing to the State of North Carolina, as defined in N.C. Gen. Stat. § 105-243.1, no payments will be
made under this Agreement or the LGGA until that tax debt has been satisfied.
If an overdue tax debt goes unsatisfied by the Company for more than one year, this Agreement may be declared in default and terminated at the direction of DOC.
7.10 The Applicant's obligation to make disbursements to the Company under this Agreement is contingent upon the Applicant's receipt under the LGGA of the necessary disbursements from DOC, which are, in turn, contingent on appropriation, allocation and availability of funds for the Grant to DOC.
7.11 This Agreement constitutes a legally enforceable contract and shall be governed and construed in accordance with the laws of the State of
North Carolina. The parties agree and submit, solely for matters concerning this Agreement, to the exclusive jurisdiction of the courts of North
Carolina and agree, solely for such purpose, that the only venue for any legal proceedings shall be Wake County, North Carolina. The place of this
Agreement, and all transactions and agreements relating to it, and their situs and forum, shall be Wake County, North Carolina, where all matters,
whether sounding in contract or tort, relating to its validity, construction, interpretation, and enforcement, shall be determined.
7.12 The parties agree that the State of North Carolina Department of Commerce is a third party beneficiary of this Agreement and may, at its
option, enforce the terms of this Agreement or appear as a party in any litigation concerning it.
7.13 Failure of the Applicant or DOC at any time to require performance of any term or provision of this Agreement shall in no manner affect the
rights of the Applicant or DOC at a later date to enforce the same or to enforce any future compliance with or performance of any of the terms or
provisions hereof. No waiver of the Applicant or DOC of any condition or the breach of any term, provision or representation contained in this
Agreement, whether by conduct or otherwise, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver
of any such condition or of the breach of any other term, provision or representation.
IN WITNESS WHEREOF, the Company and the Applicant have executed this Agreement effective as of the day and year first written above.
COUNTY OF WAKE
CREDIT SUISSE FIRST BOSTON (USA), INC.