3. Memorandum of Understanding - TeleTech HoldingsMEMORANDUM OF UNDERSTANDING
THIS MEMORANDUM OF UNDERSTANDING, between the City of Kalispell (the "City)
and Stream International Inc., a Delaware corporation ("Strew"), is for the purposes of setting
forth the intention of the parties to consummate an agreement for a buyout of the existing lease and
loan agreements between the parties for that property owned by the City and known generally as
Gateway West Mall, 1203 Highway 2, Kalispell, Montana 59901. This memorandum states the
intention of the parties to be bound by the general terms set forth below, and contingent only upon
the completion of a new lease agreement for the subject property between the City and TeleTech
Holdings, Inc. or other substitute tenant as may be identified by the City from time to time (the
"New Tenant"). The parties further agree and understand that this memorandum is a general
understanding of the lease buyout between the parties and those more specific terms shall be
identified and addressed in a more formal lease buyout agreement, which the parties shall, in good
faith, cooperatively complete. The City agrees that Stream may assign its rights and obligations
hereunder and under the relevant agreements and instruments to its parent corporation, Solectron
Corporation ("Solectron"); and, the City agrees to negotiate on good faith such assignment and
release of Stream
BASE RENT OBLIGATION:
Stream agrees, that in consideration from the City that it be released from its leasehold
obligations, that it shall pay to the City a total lump sum of $1,360,711.84 for base rent, as such
amount may be proportionately reduced based on further payments made by Stream or its assignee.
This sum represents the net present value of the rental stream of $275,000.00 rent per year to be
paid on the remainder of 6.5 years of the lease agreement discounted at four (4%) percent
(=$1,560,401.39) LESS a credit for the prepaid rent for the remainder of the lease term
(($307,214.70 x 6.5 years)/10 years = $199,689.55). Upon such payment, Stream and its assignee
shall be released for any and all obligations under the lease. The City shall provide Stream or its
assignee with a general release, effective upon such payment.
IMPROVEMENT RENT (CITY LOAN):
Stream agrees that it shall, contemporaneously with the payrn.ent of the base rent set forth
above, pay to the City the lump sum of $767,394.28, as such amount may be proportionately
reduced based on further payments made by Stream or its assignee, as and for the payoff of the
total remaining balance, as of 12/15/03, of the UDAG loan made by the City to Stream.
ADDITIONAL IMPROVEMENT RENT (AMERICAN CAPITAL LOAN):
Stream agrees that it shall, contemporaneously with the payment of the base rent set forth
above, pay to American Capital the lump sum of $1,137,746.81, as such amount may be
proportionately reduced based on further payments made by Stream or its assignee, as and for the
payoff of the total remaining balance, as of 12/08/03, of the loan made by American Capital to
Stream.
MEMORANDUM OF UNDERSTANDING Page - I
TAX (GUARANTEED .MINIMUM TAX PAYMENT):
The parties agree that the guaranteed minimum tax payment ($140,000.00 annually) for
which Stream was obligated during the term of the lease is and shall be appropriately paid by the
new tenant that enjoys the leasehold and Stream and its assignee shall be released from such
obligation.
USER FEE:
The parties agree that pursuant to the User Fee schedule established in the agreement
between the parties, Stream is current on its User Fees and owes no further User Fees to the City.
Effective as of the payment of the above amounts, Stream and its assignee shall be released from
any obligations to pay the User Fee.
TRANSACTION COSTS:
Stream agrees that it (or its assignee) shall pay up to, but no more than, S50,000.00 of the
actual transaction costs of the City (limited to reasonable attorney's fees) for the drafting and
negotiating of the buyout agreement and related documents. For the avoidance of doubt, Stream
shall not be obligated to pay any fees related to the transaction between the City and the New
Tenant. In the event that the City does not enter into a rental agreement with the New Tenant,
Stream and its assignee shall have no obligation to pay the above referenced transaction costs.
BROKERAGE FEES:
Stream agrees that it (or its assignee) shall reimburse the City for the actual brokerage fees
paid for its transaction with the New Tenant, up to an amount of no greater than $5.00 per square
foot. Stream acknowledges that the City retained the services of CRESA Partners as a broker in its
negotiations with the potential new tenant and that the City agreed, and is therefore legally bound,
to the market rate of $5.00 per square foot. In the event that Stream is able to negotiate a reduced
rate with CRESA Partners, the City agrees that it shall abide with such fee.
CONTINGENCIES:
The parties agree that this buyout agreement is contingent upon the consummation of a
rental agreement with the New Tenant. The City will be obligated to obtain a memorandum of
understanding for a new lease agreement on the Premises no later than December 15, 2003. Stream
shall remain obligated under the terms of its lease agreement with the City until such time as a
complete lease agreement is established between the City and the New Tenant.
TIME OF THE ESSENCE; TERMINATION
The parties agree that time is of the essence with respect to the transactions contemplated
under the terms of this memorandum. Notwithstanding anything to the contrary herein, Stream
may terminate at any time its obligation to negotiate on a good faith basis on the terms set forth
MEMORANDUM OF UNDERSTANDING Page - 2
above, or on any terms, in the event that the consummation of a rental agreement between the City
and the New Tenant has not occurred on or prior to January 31, 2004.
DATED this day of December, 2003.
CITY OF KALISPELL
By:
Pamela B. Kennedy, Mayor
STREAM INTERNATIONAL INC.
By:
MEMORANDUM OF UNDERSTANDING Page - 3
MEMORANDUM OF UNDERSTANDING
THIS MEMORANDUM OF UNDERSTANDING, between the City of Kalispell and
Flathead County Economic Development Authority (the "City) and TeleTech Holdings, Inc.
("TeleTech") is for the purposes of setting forth the intention of the parties to consummate a lease
agreement for that property owned by the City and known generally as Gateway West Mall, 1203
Highway 2, Kalispell, Montana 59901. This memorandum, once approved by the governing bodies
or boards of each entity and duly executed, states the intention of the parties to be bound by the
general terms set forth below, and contingent only upon the termination of that lease agreement for
the subject property between the City and Stream International, Inc. The parties further agree and
understand that this memorandum is a general understanding of the lease agreement between the
parties and those more specific terms shall be identified and addressed in a more formal lease
agreement, which the parties shall, in good faith, cooperatively complete.
TENANT:
TeleTech or a wholly owned subsidiary of TeleTech.
The City of Kalispell.
LANDLORD:
PREMISES/PROPERTY:
A total of approximately 60,645 rentable square feet, subject to final determination, location and
measurement by Tenant ("Premises") located at Gateway West Mall in the City of Kalispell,
Flathead County, Montana, being a portion of Lot 1 of Amended Plat of Mall Portion of Gateway
West Addition #34. The Premises are a part of the shopping center known as Gateway West Mall
(the `Building") and are depicted on Exhibit A attached to this memorandum. With the exception
of the Premises, the Building is owned by ACG-Kalispell Investors, LLC ("Developer"). The legal
description of the property is subject to verification by Tenant.
DELIVERY DATE and LEASE COMMENCEMENT:
The Lease shall commence at such time as the Lease is fully executed by Landlord and Tenant and
Landlord has delivered the Premises to Tenant. The parties contemplate that the Lease will
commence on or about February 1, 2004. If the Landlord is unable to deliver the Premises to
Tenant by February 15, 2004, then at the option of Tenant, the Lease shall terminate and the parties
shall have no other obligations with respect to the Premises.
EXISTING LEASE:
As a condition to the effectiveness of any lease between Tenant and Landlord, the Landlord will be
obligated to obtain a memorandum of understanding to terminate the existing lease on the Premises
no later than February 1, 2003. In the event the existing lease is not terminated by February 1,
2004, as evidenced by a fully executed termination agreement between Landlord and the existing
MEMORANDUM OF UNDERSTANDING Page - 1
tenant, the Tenant would have the right to terminate all further negotiations with respect to the
Premises. The Landlord would be obligated to provide Tenant with an original counterpart of the
termination agreement by the close of business, local time in Denver, Colorado, no later than
February 1, 2004.
INITIAL TERM AND OPTION TO EXTEND:
The initial lease term would commence on the Delivery Date and terminate 120 months from the
Delivery Date. The Tenant would have the right to extend the lease term for up to 3 periods of
three (3) years each. Tenant would provide a six (6) month advance written notice to extend.
Tenant will pay its prorata operating expenses and real estate taxes. Base rent shall be as
negotiated at that time, NNN, for each extension period. Any improvement allowances for the
extension period would be negotiated between parties and paid as Improvement Rent at then market
rates using the same amortization calculation (except for the term) and interest rate as those used
for the initial Term. The amount of the annual Improvement Rent, if any, will be determined
within sixty (60) days after the Tenant gives written notice to the Landlord that it wishes to renew.
In the event Tenant misses this notice date, Landlord agrees to notify Tenant in writing and Tenant
would have thirty (30) days from Landlord's notice to elect to exercise the option. In the event
Tenant exercises its option to renew, Landlord would pay a market commission to Tenant's broker
based on comparable national office and call center lease transactions, provided broker
demonstrates representation of Tenant and actively participates in the transaction.
TENANT IMPROVEMENT ALLOWANCE:
All improvements will be performed by Tenant's contractors, subject to Landlord's reasonable
review and approval, not to be unreasonably withheld.
Landlord shall provide an Improvement Allowance equal to $ 1,179,317.94, which shall be
amortized over 10 years at 4% interest. Tenant shall be allowed to use the Improvement Allowance
for construction costs (material and labor) and communications infrastructure, including those soft
costs and fixtures as are reasonably required for the facility and that are agreed upon by the parties,
which approval by the City will not be unreasonably withheld. Tenant shall have the right to
request and receive partial draws against the Improvement Allowance on a monthly basis beginning
on the Delivery Date, and such draws shall be based upon scheduled work completed with a 10%
holdback for a period not to exceed 45 days after all work has been completed.
At the end of the term of the Lease, Tenant will leave the Premises in the condition in which it is
required to maintain the Premises during the term and shall not be required to remove any
improvements constructed in the Premises to the extent such improvements are contemplated in
this offer or are otherwise approved by the Landlord at any time, approval not to be unreasonably
withheld. The Premises shall be returned in the same condition as at the time of delivery, subject to
normal wear and tear and casualty.
MEMORANDUM OF UNDERSTANDING Page - 2
RENT:
Base Rent shall accrue during the term at an annual rate of $4.54 per square foot, NNN, and shall
be payable annually in arrears. Notwithstanding the foregoing, Tenant shall receive credits against
Base Rent and Base Rent shall be reduced by such credits as follows:
(a) During the first 12 months of the lease term, Tenant shall receive a credit equal to 100% of
Base Rent for such period so long as the full time agent hourly wage is no less than $8.00 per hour
with a benefit package valued at an additional 20% of hourly wage and Tenant employs either (i),
at least 125 individuals, 80% of whom are FTEs [FTE defined as a "full-time employee"], at the
property at the expiration of such 12-month. period or (ii) an average of 125 individuals, 80% of
whom are FTEs, at the property during such 12-month period;
(b) During the second 12 months of the lease term, Tenant shall receive a credit equal to 100%
of Base Rent for such period so long as the full time agent hourly wage is no less than $8.00 per
hour with a benefit package valued at an additional 20% of hourly wage and Tenant employs either
(i) at least 250 individuals, 80% of whom are FTEs, at the property at the expiration of such second
12-month period or (ii) an average of 250 individuals, 80% of whom are FTEs, at the property
during such second 12-month period;
(c) Commencing on the first day of the 24th month of the lease term and continuing for each
consecutive 12-month period thereafter (each such period being referred to as a `Lease Year"),
Tenant shall receive a credit equal to 100% of Base Rent for each Lease Year so long as the full
time agent hourly wage is no less than $8.00 per hour and receives a benefit package valued at an
additional 20% of hourly wage and Tenant employs either (i) at least 425 individuals, 80% of
whom are FTEs, at the property at the expiration of such Lease Year or (ii) an average of 425
individuals, 80% of whom are FTEs, at the property during such Lease Year. If Tenant does not
meet the employment requirements of the immediately preceding sentence but Tenant employs (x)
more than 200 FTEs but less than 340 FTEs at the expiration of a Lease Year or (y) an average of
more than 200 FTEs but less than 340 FTEs during such Lease Year, Tenant shall continue to
receive a credit against Base Rent but such credit shall be reduced on a pro rata basis based upon
the higher of (x) or (y) above. If at the end of any Lease Year Tenant employs less than 200 FTEs
or has employed less than an average of 200 FTEs during such Lease Year, Tenant shall not be
entitled to any credit against Base Rent and the full amount of Base Rent accrued under the Lease
shall be payable by Tenant in cash.
EARLY TERMINATION OPTION:
Tenant shall have the option to terminate the lease anytime after the end of the fifth year of the
lease by providing the Landlord six (b) months prior written notice. In the event Tenant elects to
exercise this option, it shall pay the unaortized balance of the Tenant Improvement Allowance.
MEMORANDUM OF UNDERSTANDING Page - 3
TAXES & OPERATING EXPENSES INCLUDING PILOT/DEFICIENCY TAX
PAYMENT:
Subject to Tenant's review of the final, complete Declaration of Restrictions and Establishment of
Easements Affecting Land which encumbers the Building and any other covenants, conditions or
restrictions which may affect the Building or the Premises, to which Tenant agrees to be bound, the
Tenant would pay taxes and operating expenses as provided below.
Tenant will pay its proportionate share of Operating Expenses provided by Landlord commencing
on the Lease Commencement Date which shall include providing snow plowing and removal,
sanding of the parking lot, parking lot maintenance, landscaping of all parking lots, and trash
removal at Landlord's expense (provided that Tenant does not contract directly for such services,
which Tenant shall have the right to contract for such services itself). Tenant shall be responsible
for contracting and providing customary building services including maintenance of mechanical,
electrical and sprinkler systems for the Premises and interior cleaning at Tenant's expense. Only
those Operating Expenses that apply directly to the Tenant and their leased space will be charged.
Exclusions for operating costs include (i) legal fees, brokerage commissions, advertising costs, or
other related expenses incurred by Landlord in connection with the leasing of space to individual
tenants in the Building; (ii) repairs, alterations, additions, improvements or replacements made to
rectify or correct any defect in the original design, materials or workmanship of the Building or
common areas (but not including repairs, alterations, additions, improvements or replacements
made as a result of ordinary wear and tear); (iii) damage and repairs attributable to fire or other
casualty; (iv) damage and repairs necessitated by the negligence or willful misconduct of Landlord,
Landlord's employees, contractors or agents; (v) executive salaries or salaries of service personnel
to the extent that such personnel perform services not solely in connection with the management,
operation, repair or maintenance of the Building; (vi) Landlord's general overhead expenses not
related to the Building; (vii) legal fees, accountants' fees and other expenses incurred in connection
with disputes with Landlord's other occupants of the Building or associated with the enforcement
of the terms of any leases with tenants or the defense of landlord's title to or interest in the Building
or any part thereof; (viii) costs (including permit, license and inspection fees) incurred in
renovating or otherwise improving, decorating or painting or altering space for tenants or other
occupants or of vacant space (excluding common areas) in the Building; (ix) costs incurred due to a
violation by Landlord or any other tenant of the Building of the terms and conditions of a lease; (x)
cost of any service provided to Tenant or other occupants of the Building for which Landlord is
reimbursed and costs incurred by Landlord as a result of, or for the benefit of, any individual tenant
or occupant of the Building, regardless of whether Landlord is entitled to reimbursement; (xi) any
other expense which, under generally accepted accounting principles applicable to real estate
operations, would not be considered a reasonable maintenance and operating expense; and (xii) cost
and expenses which would be capitalized under generally accepted accounting principles; (xiii)
costs incurred for a hazardous waste clean-up unless caused by Tenant; and (xiv) costs incurred by
the Landlord in reconfiguring or renovating the Building or making improvements of a capital
nature thereto, including, without limitation, any improvements intended to increase the square
footage within the Building.
MEMORANDUM OF UNDERSTANDING Page - 4
Landlord shall not collect in excess of (100%) of operating expenses and shall not recover any item
of cost more than once. Tenant shall have the right to audit any twelve (12) months of previous
operating expenses in the event of dispute.
For purposes of the foregoing provisions regarding "Taxes and Operating Expenses", the terra
"Landlord" shall be deemed to include both the Landlord and the Developer.
TeleTech agrees to pay as due all real and personal property taxes including beneficial use taxes
assessed against the Property and its Personal property and Equipment installed and located therein
(the "Property Tax Obligation"), in addition to any special assessments that might be apportioned
to the property and made an obligation under the Lease for the term of the lease. TeleTech
understands and acknowledges that even though the Property is owned by the City, TeleTech is
subject to a "beneficial use" tax as provided in Section 5-24-2304, M.C.A. TeleTech further
acknowledges that the City's ability to retire its debt with Montana Board of Investments for the
Stream negotiated bond sale and enter into this Agreement is dependent on the use of this site to
generate taxes and additional Tax Increment Revenue within the District. Based on the estimated
value of the property, the dollar amount of the Improvements to be installed to the property and the
dollar amount of the Personal Property and Equipment to be installed or located on or in the
property, the City has estimated that TeleTech will generate property taxes payable similar to those
generated by Stream and based on current tax rates and mill levies in an amount not less than
$140,000 a year. TeleTech understands that this is an estimate and not a representation that the
TeleTech's Property Tax Obligation will not or cannot exceed such amount.
TeleTech hereby covenants and agrees to pay its actual Property Tax Obligation for term of
possession, prorated as provided in the Lease with respect to Real Property Taxes (as to be defined
in the Lease) and that to the extent and in the event that TeleTech's annual Property Tax Obligation
for tax years thereafter is less than $140,000 whether by virtue of reduction in taxable valuation of
property, reduction of mill levies assessed against TeleTech's property or that Tcletech defaults
under the Lease and has no annual Property Tax Obligation, TeleTech will pay directly to the City
an annual amount equal to the greater of (1) TeleTech's actual Property Tax obligation; or (ii) the
difference between $140,000 and the Teletech's actual Property Tax Obligation (the "Deficiency
Tax Payment"), provided that for the last year of the term of the Lease: (a) Teletech's actual
Property Tax Obligation shall be equal to the TeleTech's actual Property Tax obligation for the
immediate preceding year, (b) TeleTech's actual Property Tax obligation pursuant to clause (a) and
the $140,000 figure shall each be multiplied by a fraction, the numerator of which is the number of
days between January 1 and the date the Lease terminates and denominator of which is 365, and (c)
the resulting payment shall be paid on the date the Lease terminates. The payment for the last year
of the term shall be adjusted upon receipt of the tax notice for the final year. Under Montana law,
the Department of Revenue uses the value of real and personal property established as of January 1
each year to determine the amount of taxes to be billed for the ensuing Fiscal Year. TeleTech will
receive its notice of its Real Property tax obligation for a fiscal year on or about July 1. The City
Finance Director shall verify the amount of TeleTech's Property Tax obligation based on the actual
Real and Personal Property taxes billed during the calendar year based on values established
January 1. If a Deficiency Tax Payment is owed, the City shall submit an invoice to TeleTech no
later than December 31. The Deficiency Tax Payment shall be due and payable in one installment
on February 15 of each year through the term of this Agreement, commencing February 15, 2004.
MEMORANDUM OF UNDERSTANDING Page - 5
The amount of Deficiency Tax Payment due, but not paid, shall bear interest and penalties at the
same rate applicable to unpaid property taxes as specified in Section 15-16-102, M.C.A. Upon
receipt of amounts due, if any, the City shall deposit the Deficiency Tax Payment in the Debt
Service fund created for the Bond and the Deficiency Tax Payment shall be used solely to pay the
principal of and interest on the Bond as due.
CAPITAL REPLACEMENTS:
Landlord shall be responsible for capital replacements of existing capital components defined as;
foundation, footings, concrete slab, concrete pier, structural steel, roof deck and membrane, exterior
walls, facade, underground utilities and drainage based on Landlord and Tenant's engineers'
conclusions of replacement and remedy to such capital items. The definition of maintenance and
replacement of capital components shall be based on Generally Accepted Accounting Principles
(GAAP) and shall be detailed in the lease. If replacement of the parking lot is required during lease
term, it shall be Landlord's responsibility though the Developer.
MECHANICAL/HVAC/SPRINKLER/PLUMBING/ELECTRICAL:
Landlord shall warranty the existing mechanical systems, HVAC systems, plumbing systems,
electrical systems and sprinkler pump and warranty replacement for the term of the lease. Tenant
shall pay for repair of mechanical, electrical and HVAC systems and for replacement of systems
installed by Tenant and exclusively servicing Tenant's Premises. Any repairs or replacements to
the sprinkler heads, lines and pump are the Landlord's responsibility.
UTILITIES:
Landlord shall provide sufficient utilities, including power and gas for Tenant's operation and
separate metering for Premises. Tenant shall have use of the HVAC system 24 hours per day, 7
days per week. Tenant shall pay for utility usage directly to the utility supplier. Tenant shall have
Self-help rights in the event Landlord does not provide sufficient utilities to the Building as
required in a timely manner or in the event of interruption of services in which case Landlord has
not immediately taken the necessary action to reinstate service.
USE:
The Premises will be used initially for general office, call center, recruiting and training purposes.
Ail other legally permitted uses shall be allowed. Hours of operation shall be up to 24 hours per
day, 7 days per week. Landlord shall not lease or approve any sublease for the retraining space in
the building to any industrial or manufacturing users which may cause vibration, noise or odors, or
which in any way may disrupt or negatively effect Tenant's operations or any use, which is
competitive to Tenant.
MEMORANDUM OF UNDERSTANDING Page - 6
IDENTITY:
Tenant will have the right to install exclusive signage on the exterior of the building and on a
monument or pylon sign. Tenant acknowledges that such signage will be at its expense and will be
subject to appropriate permits and approvals by regulatory authorities having jurisdiction and
Landlord's reasonable review and approval. Landlord shall give Tenant top priority in signage on
the pylon sign until such time as another tenant has more rented square footage than Tenant.
EMERGENCY POWER/UPS:
Tenant will have the right to utilize existing and/or add additional emergency generator(s) on a
concrete pad outside of the building. Any generators purchased or added by Tenant may be
removed at the termination of the Lease by the Tenant but Tenant shall not be required to remove
such generators.
SUBLEASE & ASSIGNMENT:
Tenant shall have the right to assign or sublease any portion of the space to any party resulting from
a corporate transfer, merger or consolidation or the sale of any significant portion of Tenant's stock
or assets or to any subsidiary or affiliate of Tenant without the written consent of Landlord. Any
other assignment or sublease, shall be permitted subject to prior consent of the Landlord, which
consent shall not be unreasonably withheld, conditioned, or delayed, and shall be subject to
Tenant's agreement to maintain its obligations under the Lease. Landlord will not have the right to
recapture the space.
NON -DISTURBANCE AGREEMENT:
Landlord shall provide a non -disturbance and attornment agreements from all current and future
mortgagees and ground lessors. Tenant will provide mutually agreeable subordination and
attornment language as part of the lease.
None
SECURITY DEPOSIT/LETTER OF CREDIT:
BROKERAGE/CONSULTING FEES:
Landlord shall recognize CRESA, Teletech's real estate advisor, as the broker for this transaction
as per a separate agreement. Each party shall indemnify the other as to any other brokerage claims.
MEASUREMENT STANDARD:
The measurement standard for determining rentable and usable square footage shall be the latest
BOMA standards relating to multi -tenant buildings. (Building Owners and Managers Association
("BOMA") International ANSI Z 65.1 Method C 1996)
MEMORANDUM OF UNDERSTANDING Page - 7
ENVIRONMENTAL CONDITIONS:
Landlord shall provide Tenant with copies of their most recent Phase I report. Subject to receipt
and review of this report, Tenant shall have the option to complete a new Phase I and Il. Tenant
shall be satisfied with the initial Phase I and Phase 11 environmental reports and if not, Tenant may
terminate any agreement upon written notice to Landlord within five (5) days of receiving such
initial reports, unless Landlord immediately remediates any material adverse conditions. Landlord
shall indemnify Tenant of any liability due to any adverse environmental conditions which are not
caused by Tenant.
PARKING:
Tenant shall be provided with parking areas within reasonable walking distance (within 4 blocks) to
the Premises consisting of a total of 500 spaces. Landlord shall provide a parking plan to the
Tenant, which shall demonstrate the location and number of parking spaces that are currently
available and that will, within 60 days of notice, be made available to the Tenant as the parking
needs of the Tenant increase. See Exhibit "B" attached hereto and incorporated herein by this
reference. Landlord shall pay the cost of any development and maintenance of new parking areas
required. Landlord shall be responsible for plowing and sanding by way of the Declarations of
Restrictions agreement with the Developer.
AMENITIES:
Tenant shall be allowed to construct/expand a cafeteria in the property within the leased Premises,
at Tenant's election and cost. Tenant shall be allowed to construct/expand a patio/smoking area
located outside the building in a location to be mutually agreed upon.
NON -COMPETE:
Landlord and any related entity shall not lease/sublease space or lease/sell land, or provide
incentives to any third -party that would operate a call center within the City of Kalispell (whether
inbound or outbound) or that is competitive to the Tenant in the business of outsourced customer
services or that is reasonably considered a competitor of the Tenant without Tenant's prior written
approval.
INFRASTRUCTURE IMPROVEMENTS:
CDBG funds can be used for capital improvements if the company elects NOT to use CDBG funds
for workforce training. The maximum amount that can be applied for is $400,000. The City will
make application for these funds, but cannot guarantee their receipt. If the application were
successful, the net amount available would be $370,000. There is no wage/benefit threshold for
CDBG infrastructure funding. (CDBG funds must be expended within 18-24 months within
contract with the State of Montana).
MEMORANDUM OF UNDERSTANDING Page - 8
EXISTING ALLOWANCES:
Tenant shall pay S0.00/RSF per year as existing allowance rent though the expiration of the initial
Stream lease term.
DATED this day of December, 2003.
CITY OF KALISPELL
By:
Pamela B. Kennedy, Mayor
FLATHEAD COUNTY ECONOMIC
DEVELOPMENT AUTHORITY
Don Bennett, Chairman
TELETECH HOLDINGS, El7C.
MEMORANDUM OF UNDERSTANDING rage - 9
EXHIBIT A
(I)
Sint PIAN
EXHIBIT A
(2)
Loil',sl Desc:ripiiun of City Parcel
A parcef located in (tie Southeast '114 of Section 12, Township 28 North Gunge
22 West, Principal Meridian, Montana, flathead County, Montana more
}particularly described as foltows:
COMMENCING at the intersection of the Westerly right -al -way line of Glenwuud
Drive with the Northerly right-of-way line of U.S. Highway No, 2;
thence along said Westerly right-of-way line N00°4742" E 223.31 feet to [lie Point
of Beginning:
thence N89a16'37"W 166.51 feet;
thence Not]°56'30"E 148.77 feet;
thence N89°03'30"W 38.87 feet;
thence N00°48'46"E 199,10 feet;
thence N89'54'52"W 124,44 feet,
thence S00'45'25V 33.25 fret;
thence S89'1435"E 80.50 feet to the said Westerly right-of-way of Glenwood
Drive;
thence along said right-of-way atl0°47'42"W 316.10 leet to the Point of
beginning;
CONTAINING 1.45 acres of land as shown hereon,
TOGETHER WITH a no-bulldino-encroachment easement as shown on the plat.
SUBJECT T4 ALL existing easements and right-of-ways.
EXHIBIT B
(I)
AMERICAN CAPITAL GROUP, LLC
18TH STRkETATRIUM, 1621 EIGHTEENTH STREET, SUITE 30,-DENVER, C.OLORAU0 60202.59051(303)3[WJ.3000 i FAX (303)308-3001
MEMORANDUM
To: Susan Moyer
CC -
From: Mark Dunn
Date: December 16, 2003
Subject: Parking for Teleiech at; Gateway West
Susan: Attached to this memo I9 a survey of our Gateway West Property In Kalispell, Montana.
Overlaid on ttrfs survey Is the approximate location of the new parking field we added recently
immediately north of the existing buliding improvements. This parking field has five (5) rows of
parking with 26 spaces per row or a total of approximately 130 spaces. The area utilized for this new
parking totaled approximately 1.5 acres of land. The land we are prepared to sell the City of
Kalispell/Port Authority in order for them to meet T heir requirements for approximately. 120-130
spades with Teleiech is 7 to 1.5 acres of vacant (unimproved) land located on the northernmost part
of the property. At this time we are not certain whether this land would be located along the NWC,
NEC or positioned in the middle of the site at the north end; however, we will commit to selecting an
exact site to meet the time frames required of the City by Teleiech. If you have any further
questions regarding this memo please contact me.
EXHIBIT B
(2)
At•.TAIACSM Land Title Sunray
A portion of Gateway Wast Addition No. 34
SE114 Section 12, T28N. R22W, P.M.,M.
Fathead County, Montana
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