Klarr Locomotive IndustriesMemorandum of Understanding
This Memorandum of Understanding (the Memorandum) is made on Auutrst 14, 2020 by and between the City of
Kalispell, 201 I st Ave East, Kalispell, MT 59901, hereinafter referred to as the City and the Klarr Locomotive
Industries I.LC, 2294 Mountain View Blvd. Woods Cross, UT 84087, hereinafter referred to as KLIX for the
purpose of trading two locomotives, and the City acquiring, a former great Northern Locomotive to be displayed
within the City (the Project).
WHE:RTAS the City and KLIX desire to enter into an agreement in which the City and KLIX will work together to
complete a Locomotive Trade;
AND WHER-EAS the City and KLIX enter into a Memorandum of Understanding between them, detailing the
working arrangements that each of the partners agree are necessary to complete the Project;
Purpose
The purpose of this Memorandum is to provide the f •arnework for any future partnering between the City and KLIX.
Obligations of'the Partners
The Partners acknowledge that no contractual relationship is created between there by this Mernorandu n, but agree
to, work together in the true spirit of partnership to ensure that there is a united, visible and responsive leadership of
the Project and to demonstrate financial, administrative and managerial commitment to the Project by means of tlae
following, individual services'.
Cooperation
The activities and services for the Project shall include, but not limited to:
a. Services to be rendered by the City:
The City is offering locomotive #1.214 (SWI200) in exchange for a former Great Northern locomotive. The
City will allow access to Individuals and Contractors to inspect and/or prep locomotive # 1214 for movement. The
City will be responsible for temporarily reinovmng/modifying chain funk fence to allow movements of locomotives
during time Project. The City understands, and agrees to, that the replacement locomotive (1809) will have several
internal components removed prior to being delivered for display as detailed in EXHIBIT A.
b. Services to be rendered by KLIX:
In return, KLIX will purchase, prepare, and remove internal components and fluids from replacement
locomotive, GP9 #1809 (ex -Great Northern #657). KLIX will make all effort to modify the '1809's current paint to
resemble the Great Northern "Big Sky" blue scheme, prior to delivery to Kalispell, as long as this can be achieved
within the timeline of being able to make movements via rail. KLIX will be sure that the physical appearance of
locomotive 1809 is not altered in any way with the removal ofthe internal components. KLIX will cover the costs to
prepare and move locomotive (1809) via BNSF to the display site located within tlae City of Kalispell as shown ra
EXHIBIT B. KLIX will also make arrangements for tyre 41214 to be moved out ofthe display site. KLIX i;
dedicated to utilizing the #'1214 towards additional preservation projects in thefuture.
Resources
The Partners will endeavor to have final approval and secure any financing necessary to fulfill their individual
financial contributions at 'the start of the planning for the development of the Project.
a. The City agrees to provide the following financial, material and labor resources in respect of tile
Project,
The City will be responsible for temporarily renlov'inglrnodifying chain link fence to allow
movements of locomotives during the Project. The City also agrees to leave trackage intact until
locomotive movements in and out of the display site are complete (within a reasonable
timefi-ame).
KLIX agrees to provide the fallowing financial, material and labor resources in respect of the Project;
KLIX will be responsible for all rail transportation costs associated with the Project.. KLIX will
provide all funding for- the purchase, preparation work, and movement of'the replacement
locomotive #1809, as well as the transport of locomotive #1214 From the display site.
Communication Strategy
Marketing of the vision and any rnedia or other public relations contact should always be consistent with the goal.,,
of the Project and only undertaken with the express agreement of both parties. Where it does not breach any
confidentiality protocols, a spirit of open and transparent communication should be adhered to. Co -coordinated
communications should be made with external organizatioils to elicit their support and further the aims ofthe
Project.
Liability
No liability will arise or be assumed between the Partners as a result of this Memorandum.
insurance Requirements
Klarr Locomotive Industries, LLC shall maintain, and shall assure that its representatives,
assigns, and subcontractors maintain, for the duration of this agreement, at their cost and
expense, primary liability insurance against claims for injuries to persons or damages to
property, including contractual liability, in the amount of no less than $1,500,000.00 aggregate and $750,000.00
per occurrence, which may arise from or it) connection with the performance of the duties and obligations
in this Contract by KLIX, its agents, employees, representatives, assigns, or subcontractors. This
insurance sliall cover such claims as may be caused by any negligent act or omission and shall name the
City as additional insured.
Dispute Resolution
In the event of a disprtte between the Partners in the negotiation of the final binding contract relating to this Project,
a dispute resolution group will convene consisting of tile Chief Executives of each of the Partners together with one
other person independent of the Partners appointed by the Chief Executives. The dispute resolution group may
receive for consideration any information it thinks fit concerning the dispute. The Partners agree that a decision of
the dispute resolution group will be final. In the event the dispute resolution group is unable to make a compromise
and reach a final decision, it is understood that neither party is obligated to enter into any binding contract to
complete tlwe Project.
Term
Tile arrangements made by the Partners by this Memorandum shall remain in place from August 3, 2020 until
December 31, 2020. The term can be extended only by agreement of all of the Partners.
Notice
Any notice or communication required or permitted under this Memorandum shall be sufficiently given ifdehvered
in person or by certified mail, return receipt requested, to the address set forth in the opening paragraph or to such
other- address as one party may have fumished to the other in writing-
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Governing Law
This Memorandum shall be construed in accordance with the laws of the State of Montana.
Assignment
Neither party may assign or transfer the responsibilities or agreement made herein without the prior written consent
of the non -assigning party, which approval shall not be unreasonably withheld,
Amendment
This Memorandum may be amended or supplemented in waiting, if the writing is signed by the party obligated
under this Memorandum
Severability
If any provision of this Memorandum is found to be invalid or unenforceable for any reason, the remaining
provisions will continue to be valid and enforceable. If a court finds that any provision of this Memorandum is
invalid or Unellforccable, but that by limitingsuch,provision it would become valid and enforceable, then such
provision will be deemed to be written, construed, and enforced as so limited,
Prior Memorandum Superseded
This Memorandum constitutes the entire Memorandum between the parties relating to this subject matter and
supersedes all prior or simultaneous representations, discussions, negotiations, and Memorandums, whether written
or oral.
Understanding
It is mutually agreed Upon and understood by and among the Partners of this Memorandum that:
a, Each Partner will work together ill a coordinated fashion for the Fulfillment of the Project,
b, In no way does this agreement restrict involved Partners from participating in similar agreements with other
public or private agencies, organizations, and individuals,
c. To the extent possible, each partner will participate in the development of the project.
d. Nothing in this memorandum shall obligate any Partner to the transfer of funds. Any endeavor involving
reimbursement or contribution of funds between the Partners of this Memorandl.1111 will be handled in
accordance with applicable laws, regulations, and procedures. Such endeavors will be outlined ill separate
agreements that shall be made in writing by representatives of the Partners involved and shall be
independently authorized by appropriate statutory authority. This Memorandum does not provide such
authority.
e, This Me ill oran dull, is 'lot intended to and does not create any right, benefit, or trust responsibility.
f. This Memorandum up will be effective signature of both Partners.
I upon tile s'Ll
g. Any Partner may terminate its participation in this Memorandum by providing written notice to other
Partner,
ll. Both Partners agree to complete all required legal documentation outlying [lie details of this trade.
The following Partners support the goals and objectives of tile Locomotive Trade (Project):
City of Kalispell
By: Jarod Nygren, Development Services Director
Klarr Locomotive Industries LLC
By: Derrick Klarr, Owner
EXHIBIT A
The following items wi I I be removed from tocomotive # 1809 prior to delivery, and at the expense of
KLIX:
4 Traction Motors and Leads
Prime Mover
Main Generator
Air Compressor
Auxiliary Generator
Reservoirs and Fluids
Various Electrical Components
N
EXHIBITB
MAPS SHOWING LOCATION OF LOCOMOTIVE #1214
& DESIRED LOCAHON OF LOCOMOTIVE # 1809