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Home My WebLink About2005-08-08 05-273 ORDERAMON ne_273 Item No. Date: Auaunt8.2005 Item/Subject: ORDER, Authorizing Execution of Leese Agreement and Purchase Option Agreement—Hallowell International, LLC —110 HildreN Street Responsible Department: Community and Economic Development Commentary: This Order would approve a lease agreement with Hallowell International, LLC, whereby the City would lease space in its 110 Hildreth St. property to Hallowell International for the purpose of manufacturing, assembling and dis0ibuting cold weather heat pumps, a highly efficient method of providing heating and curling to homes and business. The technology used by Hallowell makes its heat pump capable of achieving the efficiency and capacity needed a low temperatures experienced in colder regions. Hallowell projects to employ 31 persons at the end of the first yew of production, 280 m the end of the second year, and in excess of 400 m full production at the end of the third year. Department Head Recommend approval. 79 dIL" // J UI I CChat Meana -ger Associated Information: Budget Approval: Finance Director X Passage _ First Reading Page _ of _ Better 05-273 (dW U BY SUBSTITUTION AssignedM Cwwcilor Allen August 8. 2005 CITY OF BANGOR (TIRE.) Order, Auffich hrg Execution of Lease Agreement and Purchase Option lq cemwt—Hollowell Nternatlonal, LLC -110 FEldreth Street By the G(y Cousin of the Qty of Bangor. ORDERED, THAT WHEREAS, Me Cityp hoer to mor into an fvdeoNre ofLeace wiW Hallowell Immos ii l.LC vimh proll to we the progeny, at 110 HJtlreW Street for 0e purpott ofmanufacmin& asavMling and laughing cold worther hem pump: and WHEREAS, Hallowell lnMn tml. LLC will provide subslaotim new turnaround opportunities fw armMoidmh; NOW, THEREFORE, BE R ORDERED BY THE MY COU RAL OF THE CRY OF BANGOR, THAT, Me City Maoeguis hereby audoinael to ordermo M Bradstreet ofLeave leasing 110 Hildre@ Street 0 Hallowell InbmatiotW, LLC, substantially under Me mllowwg t ate eonditins, mW w a pool Poen around by the City Solicitor w Aasimant city, Solicitor. Locatlon: 110 HBErelh St, Bangor, Maine pmmleea (sq, h.): August 9, M05 though April 30.2008: Fite flaw Office, 2,178 sq. ff. Office Matadors 2,178 sq. R. 5,000 sq. ft. MammoMring I Warehouse Area May 1, 2008 through Apd130,2007: First floor OBke, 2,178 sq. fl. O1Bca MeessanFe 2,178 sq. R 10.0001 ft. Manufactudrg I Warehouse Aran May 1, 2007 through April 30,2008 First Mor Now, 2,178 sq. ft OMetR8eq.ft 19..0000 0 sq, fl., ManuanufaIXurlrg! Warehouse Area May 1, 2008 though Arm N, M12: Entre building Additional Space: Upon W days advance twice tothe City. Hallmvell International, LLC, hoer August 9, M05 through Apil W, 2008, may Increase the spars ft conmias In Me building at the lease rare of $3.00 per square foot M space occupied. Lease Rate. August 9, 2005 through Apel 30.M08:$300 per square foot of spats occupied by Ha9ovrell International, LLC, not to exceed $18,000, payable on a monthly WI May 1, 2008 through Apel N. 2007: $300 pw square fool of space occupied by Halbxell International, LLC, not to exceed $30,000, payable on a monthly basis. 05-2]3 May 1, 2007 through Apnt 3Q 2008: $8.00 per square foot of space ocoupled by Hallowell Intematbrel, LLC, not to exceed 352,000, payable on a monthly basis. May 1. MOB Mrcugh April 30, 012:$130,000 annually, payable on a baby basis. Term: August 9, 2105 through April 30, 2012, with annual options for Me C" dominate the lease Nmdaln agreed on employment thresholds on Me premises are not reached and maintahred by Hallowell Intematlanal, LLC, Lease Conditions: During Me term of Me ends, Hollowell Malawtlanal, LLC maintains cabin agreed on employment levels m properly or in Bangor as follows: August9,2005tmugh ApAt30,200G: Minimum4employres May 1, 2008 through April 30, 2007: Minimum 20 employses May 1, 2007 Mmgh Alan 30, 2008: Minimum 50 employees May 1, 2008 Mough and of lam period Minimum of 100 employees. It The allows employmentlevels are to be measured at Me end of the time period. Occupancy Costs: Telephone: 100% responsibility of Hallowell Immortanal, LLC throughout term. Electddty: If all electricity on Me property Is consumed by Hallowell Inlematlonal, LLC, Men Hollowell Intdnatbnal, LLC would have 100% responsibility. If net. Me electriuty coal would be based pro rate an the percentage of rokl building mace oocupled by Hallowell International, LLC through April 30,2008. From May 1, 2000 and thereafter Hallowell International. LLC would have 100% responsibility. Fuel 011: A pro rata amount of Me heating costs based on Me pencentage of road building space occupied by Hallowell International, LLC through April 30, 2008, From May t, 2008 and thereafter Hallowel Inlematmnal, LLC will have 100% responslMlity. Water & &ewer Fees: As long as Hallowell International, LLC remains Me sole aw,pant of the property, the fees Wit be the 100% responsibility of HaWwell Intamatbrel, LLC. 0Helwise Mewalerand sawmuserf erwill be based pro mm on the percentage altobl building space occupled by Hallowell international, LLC through April 30. 2008. From May 1, 2008 and thereafter Hallowell lntemational, LLC will have 10% responsibility. Grounds Landscaping & Smwplowing: As long as Hallowell International, LLC remains Me sok occupant of the property, Me grounds landscepimg and sn wsplpwtig costa will bB Me 100%responsibilb M Hallowell International, LLC. Otherabs the grounds Iarboaping and snowplowing cosH will be based pro rate on this percmkge of total building space cavpiecl by Hallowell International, LLC through Apr1134MOB. From May 1, 2008 and Hereafter Hallowell International, LLC will have 100% responsibility Insurance: Hallowell lnkmes on d, LLC will provide comprehensive public and property, damage liability Insurance to limb of $400,000 par each ocuunence. As of May 1, 2008 Hallowell Inkmalional, LLC will provide comprehensive Fire Damage (Hazard Insurance)to a limit 0$1p00.000 each occurrence. 05-2)3 Taxes -Real Est : Beginning am my real estate was due Me City after July 1, 2008 for occupancy and use of Me space leased by Hallowell International, LLC, Hallowell International, LLC will be responsible for real estate taxes assessed by to City of Bangor on the space occupw by Hallowell treatments, LLC. Any real estate tares assessed M Hallowell Intemational, LLC and due Me City prior to Juy i, 2008 far its use and Occupancy INihe property w1l be Me respcnsibllXy of Me City of Bangor. Slwuld Hallowell Inte"Noro d LLC fuly xupy the buiMitq prior to Pynl t, 20%. Hallowell Impassioned, LLC will be responsible for real estate taxes assessed by Me City of Bangor on to apace occupied by Hallowell International. LLC due July i, 2006 and thereafter. Taxes- Personal Preperry: Hallowell International, LLC will be responsible for personal property taxes assessed by the City on machinery and equipment owned! by Hallowell Intenummal, LLC and located an Me property. Use: The premises will be used In a businesslike, clean and safe manner for Me manufacture of a co1E weather heat pump and related products and for no error purposes wall Me consent of Me City of Bangor. Maintenance: Hallowell International, LLC will be responsible for all ordinary and reufine maintenance of to folbwhg: all ilxmres, Including electrical, heating and plumbing fuWre. door. windows, floor coverings, callings, walls, and interior paint surfaces. The Tenant will alae be responsible for cleaning,snowplowing, rubbish removal, parking areas and Mounds landscaping. The City of Bangor will be responsibb for all ordinary and boards maintenance of the following: Me bulli major structural components: roof, structural walls, foundatlon, spending systems, Including heatlng, plumbing, vermation and electrical systems exmpt electrical, heating ant plumbing fsdures, and exterior palMsudacea. Other: During Me term of the know, Me City of Bangor shall have the right to lease Mose areas of the property net leased by Hallowed Internmonel, LLC to oters for uses compatible W. and not dlamptive to, the use ofMe areas leased by Hallowell International LLC. Evidence, satisfactory to the Cly Solktior, on or before December 30, 2005, of equity finandng / Investment owned for the project of not less Man $1.5 million. Purchase Option: Hallowed Informational, LLC will have an option M purchase the morpedythi To term of the lease at Mir marked teles so long as Hallowell IMemetianal, LLC us in compliance with Me terms of dee lease. Mug1,M6#uWgh AprJ30,2007: $300 peraquerelaot of space ocmpietl by Hallowell Intemalpnal LLC, not b exceed $W,M, payahe on a monthly basis. May 1, 2007 through Andy 30. 2008: V,00 per square had of space occupied by Hallowell madmmonal LLC, not to exceed $52,000, peyede on a modMy boars. May 1, 2008 through April 30, 2012: $130,000 amualty, payable m a moMhty basis. Tarlo August 9, 2005 through Add 3o, 2012. with annual options fw Me City to terminate the lease it oerturl agreed on employmed thresholds on Me premkes are not reached and maintained by Hallowell Intemadorel I.I.C. Lege Conditions: During Me term of Melease Hallowell Intemetionsl LLC maintains semen agreed on employment smile on propertyw in Bangor as follows: August9,2%5Mrough Apri13o,2000: Minimumwempbyeas May 1. 2006 through April 30,2007: Minimum 20 employees May 1, 2007 though Apdn, 2000: Minimum 50 employees May 1, 2008 thaugh and of one period: Minimum of 100 employees. Hole The seems employment levels are to be measured at Me end of the umepeXod. Occupancy Corona: Telephone: 100% responsibility of Hallowell Intemadorel LLC throughout term. Electricity: If all elecmdty, on Me property, h consumed! by Hallowell Inlemational LLC, Men Hallowell International LLC would have 100% responsibility. If not, Me seal ioty mat and W based pro moa on the percentage 0told Wilding space occupied by Hallowell International LLC Mmugh Amil W, 2008. From May t, 2008 and Mereaher Hallowell Intemsilonal LLC would have 100%responsibility. Fuel CII: A pro rata amount of Me hating mate based on the percentage of Wal building space occupied by Hallowell limmatMal LLC through April 30, 2008. From May 1. 2008 and thereafter Hallowell International LLC will have 100% raporw�tiry. Water$ Sewer Fees: As long as Hallowell International LLC remains Meade occupant dihe property, Me fees wul be Me 100% responsibility of Hellawall Intamsuonal LLC. OheWse Mewaterandseweruserf WilWbasedpmrete on Me pwwntege dtood Wilding space omupied by Halbwdl intensional LLC through AMW 30,2008. From May 1, 2008 and thereafter Hallowell lntemadonel LLC and have 100% responsibiMy, Grounds Lwndsmping & Snowplowing: As Iwg as Hallowell International LLC headed; Me ads occupant of Me property, the grounds IeMsraping and snowptowing cosh will be Me 100% responsibility of Hallowbi international LLC. Otherawas Me grounds landscapng and snowgmnry cosh will be based pro rete on Me Porcentele of total building space occupied by Hallowell Intema0onal LLC through April W, 2008, From May 1, 2008 and thereafter Hallowell International LLC will nave 100%responabllity Insurance. Hallowell International LLC will provide comprehensive Winicand promrty damage uatility, Insurance b limits of $100,000 per each occurrence. As of May 1, 2008 Ihllowell himmatbnal LLC will provide comprehensive Fire Damage (Hazard Insurance) to a limit of $1,400,000 each ocmuence. 05-373 Taxes -Ram Eabb: Beginning with arty real estaM taxes sue Me City aftw JUN 1, 2009 fwoccumincy and use ofthe space Massa by Hallowell International LLC, Milowen International LLC WII De responsible for rsal "bb lox" assess" by MB City of Bangor on ere space occupies by Hallowell Inlematimal LLC. AN Mal estate tax" Meadows p Hallowell International LLC end due the City prior to July 1, 2008 for its use and occupancy of Me properly will ce Me responsibilllyofthe Cllyof Bangor. Should Hallowell International LLCfuIty oceupy the building prior to pnl t,2008, Hallowell International LLC will this responsible for reel estate tees assessed by has City of Bangor on the space occupied by Hallowell International LLC due July 1, 2006 and thereafter. Tax" -Personal Property: Hallowell lnternatlonal LLC will the responsible he personal property Marks depressed by th City on machireay and equipment owned by Hallowell International LLC and prated on the prop". Use: The premses will be used in a businesslike, clean and safe manner for Ma manufacture of a mid wamher hem pump and retired products and for n0 other purposes without Me consent of Me City of Bangor MahHarence: Hallowell International LLC will her responsti for all ordinary, and routine maintenance of Me Allowing: all fixtures, inducting electrical and plumbing Ntluree, seems, windows ,A"coverings. mingle. walls, and interior paint surfaces. The Tenant will also be responsible pr cleaning, snowplowing, rubbish removaf parkins areas and grounds landscaping. Ther City of Bangor will be restearable for all aNMary and routine maintenance of the fdlowing, Me buidirgk major structural componens: roof, structural walls, foundation, opersMg systems, including herring, Numbing, ventllmian and elyess 1systemsexcept eledrtal and plumbing prlur", and exleor paint sudac". Other During Me one of Me Mase. Me City of Bangor shall have the night to lease those areas of Me property not leased by Hallowell Internammit LLC to others for us" comparable to, and not dismpM1VB to Me use of Be areas leased! by Hallowell Idamatianal LLC. Evidence, salisfadary to Be City Solichhu, of equity promising l Investrentoapital forthe project of not less Man $1.5 million. Purchase Option: Hallowell lntemational LLC will have an option to purchase, the property swung tie term of Me lease at Mir market value so long as Hallowell International LLC M In omnpliance with the terms of gra lease 05-273 Assigned tO Councilor pllev August 8. 2005 . ; CITY OF BANGOR (TTTLE.)Order, Authorivng Execution of Lease Agreement and Purohsu Option Agreement — Hallowell Ntemo6onal, LLC -110 HUdreth Street By Use aty Coundl W Nie Ory oftangos. ORDERED, THAT WHEREAS, Me CitypirWsas In owner intern Ind sure ofIlene wish HelJowell International, LLC which propxee be weft prepmy a 110 Hi1Mrfi Sews for Ne puowas ofman owermin& aaeemblmB and diributeg sold weather hear romps: and WHERAS, Heilowen hUanetiorel, IYC will provide submarine aero employment opporrvnien kr area soldier; NOW, THEREFORE, BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR, THAT, the CM Manager is Mreby auNnved to war meow lonesome of Lease kuing 110 H Mists Save W Hallowell intemnional,LLC, suMlarlUlly under Ne following amu and wnditims, and wch amu ael Wool Mer subsequWly may be appmwd by Me Business and Economic PorobpmW Comments, and in afinal foam approved by Me City Solicitor or Assures City Solicitor. Located: 110 HIIdreM St., Bangor, Maine Rremeaa(ep. R): August 9, 2005 through ANN 30. 2008: First Nov OB&e, 2,178 eq. R OMce Mezzanice 2,178 ". B. 5,000 aq. R. Manufacturing I Warehouse Area May 1, 2008 Tmugh April 30, 20D7: Firer Boor OFim, 2,178 ". It Office Mezzanine 2,176 so, fl. 10,000 ul. B. Manufacturing / Warehouse Area May 1. MIT through April 30, 2008 Find floor Office, 2,178 a q. fl. Olfre Mezzanine 2,178 se. It. 19,000 ", fl. Manufacturms; I Wembouse Area May 1, 2008 thouM April 3o, 2012: Entre budding Addhenal Space: Upon 00 days advance notice to He City, Hallowep International LLQ tram Auguaz 9, 2005 through April W, 2008, may increau Me apace it occupies in the buildiig 9 M beau rah of $3 00 per spume foot of apace occupied. L.ene ftw August 9, 2005 through April 30,2008: MOO per square Nov of space occupied by Hallowell International LLC, son to aimed $18,00r), payable on a monthly were IN cin COOXCiI. August 9. zoos notion ease and setomed for Passage Motion Xade and seconded to Amevd by Substitution Amendment Posses Notion Made and seconded for Passage ae Amended Passed u uszn R MSUIyg fl�Plg� Authotiaf -gaecdtiou of mesa: Agreement. t - WIOWMII Interntioval . Id cn- 110�n Nil tet street ouudlo, nab„