DEVELOPMENT AGREEMENT
STATE OF LOUISIANA
PARISH OF CALCASIEU
BE IT KNOWN, that on the dates hereinafter set forth, before the
undersigned Notaries Public, duly commissioned and qualified in and for the
state and parish set forth hereinafter, and in the presence of the
undersigned competent witnesses, personally came and appeared PIM, LLC
(NOW: UNIFAB INTERNATIONAL WEST, LLC) AND UNIFAB INTERNATIONAL, INC.,
(hereinafter jointly called "Unifab"), herein represented by its duly
authorized officer, and the CALCASIEU PARISH POLICE JURY, (hereinafter
called "Parish"), hereinafter represented by its duly authorized President,
and the LAKE CHARLES HARBOR & TERMINAL DISTRICT, (hereinafter called
"Port"), herein represented by its duly authorized Executive Director, who
declare that:
WHEREAS, the Parish is a political subdivision of the State of
Louisiana, as the governing authority of Calcasieu Parish, Louisiana, and
as such is vested under the laws of the State of Louisiana with certain
powers and duties among which is the authority to induce and encourage the
location of new industry and business into the Parish and thereby enhance
the economic well-being of the Parish; and
WHEREAS, the Lake Charles Harbor & Terminal District, a deep-water
port and political subdivision of the State of Louisiana, created and
organized pursuant to the provisions of Article VI, Section 43 of the
Constitution of the State of Louisiana of 1974; part VII of Chapter I of
Title 34 of the Louisiana Revised Statutes of 1950, as amended and
constitutional and statutory authority supplemental thereto, is authorized
under the provisions of law to induce and encourage the location of new
industry and business into the District, and thereby, enhance the economic
well being of the District and Southwest Louisiana; and
WHEREAS, Unifab is locating in Calcasieu Parish, on property known as
the Industrial Canal, owned by the Port, a facility for the fabricating and
refurbishing of offshore oil wells, drilling rigs and petroleum production
and exploration platforms; and
WHEREAS, it is estimated that the Project will initially create l00
construction jobs and 500 new permanent jobs and that, contingent upon the
success of the Project, additional phases of the Project will be undertaken
by Unifab which will potentially create more new permanent jobs; and
WHEREAS, the Parish has determined that it is in the public interest
to assist the Port in the removal of spoil at the Project Site; and
WHEREAS, the Port has determined that the Project needs removal of
approximately 1.1 million cubic yards of spoil material dredging to
facilitate a new sheet pile wall; construction of the following items,
including but not limited to: a sheet pile wall (including the back system
and mooring units), general relieving platforms, relieving platforms for
heavy lift cranes; and other associated administrative support (including
administration, technical engineering, environmental reviews and
permitting) to make possible the necessary improvements to the property for
Unifab; and
WHEREAS, the Parish and the Port have further determined that the
accomplishment of these improvements is consistent with the responsibility
of the Parish and the Port to foster economic development and growth within
the Parish; and
WHEREAS, the Parish and the Port desire to cooperate with each other
to provide for the necessary improvements to attract Unifab to Calcasieu
Parish; and
WHEREAS, the Parish and the Port desire to enter into this Development
Agreement with Unifab which would provide for the improvements, at the
expense of the Parish and at the expense of the Port, and further, would
provide for other terms and conditions, as may be determined to be
appropriate.
NOW THEREFORE, for and in consideration of the terms and conditions
set forth herein, the Parish, the Port, and Unifab agree as follows:
SECTION I
DEFINITIONS
"Applicable Laws" shall mean all present and future laws, ordinances,
orders, rules and regulations of all federal, state, parish, and municipal
governments, departments, commissions, or offices, in each case having
applicable jurisdiction over the Project Site, the Port, or Unifab.
"Port Improvements" means those improvements as descried on Exhibit
"3" to the Ground Lease Agreement and set forth in Section II B of this
Agreement.
"Ground Lease Agreement" means that lease agreement between PIM, LLC
and the Lake Charles Harbor & Terminal District dated September l, l998.
"Unifab Improvements" means the improvements as described on Exhibit
"2" to the Ground Agreement as now set forth in Section III of this
Agreement.
"Port" means the Port of Lake Charles in the Parish or the Lake
Charles Harbor & Terminal District.
"Project" means the construction and operation of an off-shore oil
exploration/production fabrication and refurbishing facility on that
property as described on Exhibit "1" of the Ground Lease Agreement.
"Project Site" means the real property designated as Parcels I and II
consisting of approximately 50 acres and described specifically by the
survey and legal description on Exhibit "1" of the Ground Lease Agreement
upon which the Project will be located and which real property is owned by
the Port and leased by the Port to Unifab pursuant to the Ground Lease
Agreement.
SECTION II
PUBLIC IMPROVEMENTS
A. THE PARISH
1. Spoil Removal - The Parish will contribute $2,000,000.00 in
Parish funds over a period of three consecutive years to be
divided into three equal installments to assist in the total cost
of removal of approximately 1.1 million cubic yards of spoil at
the Project Site located on the Industrial Canal. The initial
payment shall be due July l, l999, and all subsequent payments
shall be due July 1st thereafter.
2. Reimbursement - In exchange for its financial contribution to the
Project, the Parish shall share in the lease revenues received by
the Port from Unifab in an amount not to exceed l3.5 percent of
the monthly lease revenues received until such time as the Parish
has been reimbursed $500,000.00. Payments to the Parish by the
Port shall commence upon completion of the improvements to be
constructed by the Port as specified in B below and shall be paid
as Unifab pays its rent.
3. Excess Spoil - The Port shall make available from the Port's
Industrial Canal property any excess spoil to the Parish at no
cost as needed by the Parish provided that the Parish will be
responsible for all transportation from the Port's Industrial
Canal Property.
4. Water Improvements - In consideration of the mutual agreements
contained herein, particularly, the payment by the Parish of
$2,000,000.00 to the Port, the Port hereby conveys to the Parish,
without warranty of fitness, the water plant and tower, together
with associated equipment and lines forming the water system at
the Port's Industrial Canal property, which shall continue to be
operated and maintained by the Port for a period not to exceed
one year from the execution of this agreement or until such time
as the Parish assumes the operation and maintenance of the water
system which ever occurs first, more particularly described as:
a. 750,000 gallon water tower;
b. the water treatment plant; and
c. two water wells and one three hundred thousand gallon ground
storage tank; and
d. the water mains, pipelines, or distribution lines; and
e. that tract of property described and shown on Exhibit "A-1"
B. THE PORT - PORT IMPROVEMENT TO PROJECT SITE
1. Spoil Removal - The Port shall remove from the Project Site
approximately 1.1 million cubic yards of spoil.
2. Dredging - The Port shall dredge the waters adjacent to the
Project Site to facilitate a new sheet pile wall in accordance
with plans and specifications developed by the Port and approved
by Unifab in accordance with the Ground Lease Agreement.
3. Construction - The Port shall construct a new sheet pile wall,
including the tie back system and mooring units general relieving
platforms and relieving platforms for heavy lift cranes in
accordance with plans and specifications developed by the Port
and approved by Unifab in accordance with the provisions of the
Ground Lease Agreement.
4. Administration - The Port shall be responsible for the associated
project costs listed in conjunction with items number one, two
and three including administration, technical engineering,
environmental reviews and permitting related to said
construction.
5. The improvements and work provided for in this subpart B shall be
completed by the Port in accordance with that time schedule
attached hereto as Exhibit "A-2".
SECTION III
UNIFAB IMPROVEMENTS
1. In consideration of the above, Unifab agrees to construct or provide
or have provided the following:
A. Fabrication shop;
B. Pipe Shop;
C. Electrical, gas and air piping;
D. Project administration and technical engineering;
E. Moveable equipment, such as cranes, cherry pickers, etc.; and
F. Project site stabilization work; and
G. Provide for a construction contingency fund in accordance with
agreement adopted by the Lake Charles Harbor and Terminal
District on December l6, l998, as a result of Resolution Number
98-093.
H. Appropriate tool rooms, restrooms and administrative office
spaces contained within the above detailed buildings or otherwise
located in a facility satisfactory to Unifab.
2. Unifab shall expend a minimum of $8 million in completing the
Unifab Improvements set forth in A-H above and such
improvements shall be constructed in accordance with the time-
line set forth in Exhibit "A-2".
3. Unifab will have prepared, at its expense, and submit all plans
and specifications to the Port for approval prior to
construction in accordance with the provisions set forth in
Ground Lease Agreement.
4. After completion of the Project, Unifab will endeavor to
employ 500 full-time (40 hours per week) people to work on the
Project Site all as set forth in the Ground Lease Agreement. In
accordance with the Ground Lease Agreement and subject to
prevailing business conditions affecting Unifab, Unifab agrees to
hire to the maximum extent practicable and give preference and
priority for such jobs to residents of Calcasieu Parish,
Louisiana, and thereafter, to residents of the State of
Louisiana, as a whole.
5. Unifab agrees to give preference to local contractors,
subcontractors and vendors in accordance with the provisions of
Section 6.l0 of the Ground Lease Agreement.
6. Unifab agrees, at its expense, to take all appropriate steps
to obtain and maintain all applicable federal, state and local
permits for the construction of the improvements and construction
and operation of the Project and comply with all Applicable Laws.
7. Unifab agrees to register with the Louisiana Employment
Security Office, and to the maximum extent possible, hire or
cause its contractors and subcontractors to hire employees needed
for construction and operation of the Project through the
services of that office.
8. Unifab agrees to register and cause its contractors and
subcontractors to register the work to be done with the Calcasieu
Parish Sales Tax Collection Office.
9. Unifab agrees to provide the Parish with an Emergency
Response Plan to be approved by the Parish whose approval will
not be unreasonably withheld, and to continue to cooperate with
the Parish regarding emergency response planning on an ongoing
basis.
l0. Unifab agrees to comply with all Applicable Laws in the
development and operation of the Project.
SECTION IV
HOLD HARMLESS/LIMITATION OF LIABILITY
Unifab agrees to indemnify and hold harmless the Parish to the same
extent as the Port in accordance with the provisions of Paragraph l0.l-l0.4
of the Ground Lease Agreement.
SECTION V
ENFORCEMENT
In addition to any other remedy permitted by law, the Parish, Port and
Unifab may be entitled to a court order providing for specific performance
of any obligations provided for in this agreement. Further, the Parish
shall be entitled to withhold the issuance of permits required by Unifab if
Unifab is generally not in compliance with any provision of this agreement
and due notice in writing thereof has been previously given to Unifab prior
to the time of the request for issuance of said permit, and only then if
the failure to comply with this agreement is applicable to the permit
requested.
After 30 days written notice to Unifab, the Parish or the Port may
take legal action to enforce and collect a reasonable estimate of the value
of any obligation or other consideration owed by Unifab under this
agreement, together with interest and reasonable costs and expenses of
collection, including reasonable legal fees. The estimate of the value of
any obligation or other consideration owed by Unifab shall not include any
consequential damages incurred by the Parish or the Port, and therefore,
the Port or the Parish shall have no right to sue Unifab for recovery of
consequential damages arising from any obligations of Unifab set forth in
this Agreement. Consequential damages shall include, but not be limited to
incidental, indirect or punitive damages, damages for loss of use, loss of
profit or loss of revenue.
SECTION VI
ATTORNEY FEES AND VENUE
In the event of a judicial proceeding brought by one party to this
agreement against the other party to this agreement for enforcement or for
breach of any provision of this agreement, the prevailing party in such
judicial proceeding shall be entitled to reimbursement from the
unsuccessful party of reasonable costs and expenses, including reasonable
attorneys' fees incurred in connection with such judicial proceeding. This
agreement is enforceable in the Fourteenth Judicial District Court, Parish
of Calcasieu, State of Louisiana.
SECTION VII
NATURE, SURVIVAL AND TRANSFER OF OBLIGATIONS
All obligations assumed by Unifab under this Agreement shall be
binding upon Unifab as an entity, its successors and assignees. To ensure
that all such successors or assigns have notice of this agreement and the
obligations created by it, Unifab shall:
i. Deposit with the Port, contemporaneously with the Parish and the
Port's approval of this agreement, any consents or other documents
necessary to authorize the Port to record this agreement with the
Calcasieu Parish Clerk of Court recorder of Deeds; and
ii. Notify the Parish and the Port in writing at least 30 days prior to
any date upon which Unifab transfers a legal or beneficial interest in
any portion of the Unifab Improvements to any party not a party to
this agreement.
SECTION VIII
TERM
This agreement shall be in full force and effect from September l,
l998 for a period of five (5) years.
SECTION IX
NOTICE
Any notice or other communication required or permitted to be given
under this agreement shall be in writing and shall be (i) personally
delivered, or (ii) delivered by a reputable overnight courier, (iii)
delivered by certified mail, return receipt requested, and deposited in the
U.S. Mail, postage prepaid. Telecopy notices shall be deemed valid only to
the extent that are (a) actually received by the individual to whom
addressed and (b) followed by delivery of actual notice in the manner
described in either (i), (ii) or (iii) above within three (3) business days
thereafter. Unless otherwise expressly provided in this agreement, notices
shall be deemed received upon the earlier of (x) actual receipt; or (y) one
(l) business day after deposit with an overnight courier as evidenced by a
receipt of deposit; or (z) three (3) business days following deposit in the
U.S. mail as evidenced by a return receipt.
Notices and communications to Unifab shall be addressed to, and
delivered at, that following addresses:
Unifab International West, LLC
C/O Stockwell, Sievert, Viccellio, Clements & Shaddock LLP
Post Office Box 2900
Lake Charles, Louisiana 70602-2900
Attention: Mr. Charles D. Viccellio
WITH A COPY TO:
Unifab International, Inc.
P. O. Box ll308
New Iberia, Louisiana 70562-l308
Attention: Chief Financial Officer
Notice and communications to the Parish shall be addressed to, and
delivered at, the following address:
Parish Administrator
Calcasieu Parish Police Jury
P.O. Drawer 3287
Lake Charles, LA 70602.
Notice and communication to the Port shall be addressed to and
delivered at, the following address:
Executive Director
Port of Lake Charles
l50 Marine Street
Lake Charles, LA 7060l
By notice complying with the requirements of this Section, each party
shall have the right to change the address or the addresses, or both for
all future notices and communications to such party, but no notice of a
change of addressee or address shall be effective until actually received.
SECTION X
TIME OF THE ESSENCE
Time is of the essence in the performance of all terms and provisions
of this agreement.
SECTION XI
WARRANTIES
By execution of this Agreement, the parties acknowledge that they are
unaware of any event of default on the Ground Lease Agreement as of the
date of execution hereof.
SECTION XII
SEVERABILITY
If any term, covenant, condition or provision of this agreement is
held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions, covenants, agreements, or portions
of this agreement and the validity, enforceability and application to any
person, entity or property shall not be impaired thereby, but such
remaining provisions shall be interpreted, applied, and enforced so as to
achieve, as near as may be, the purpose and intent of this agreement to the
greatest extent permitted by applicable law.
SECTION XIII
ENTIRE AGREEMENT
This agreement shall constitute the entire agreement of the parties to
this agreement; all prior agreements between the parties, whether written
or oral, are merged in this agreement and shall be of no force and effect
to the extent they are incorporated in this agreement. Nothing herein
contained shall modify or change the terms of the Ground Lease Agreement.
SECTION XIV
INTERPRETATION
This agreement shall be construed without regard to the identity of
the party who drafted the various provisions of this agreement. Moreover,
each and every provision of this agreement shall be construed as though all
parties to this agreement participated equally in the drafting of this
agreement. As a result of the foregoing, any rule or construction that a
document is to be construed against the drafting party shall not be
applicable to this agreement.
SECTION XV
AMENDMENTS AND MODIFICATIONS
No modification, addition, deletion, revision, alteration, or other
change to this agreement shall be effective unless and until such change is
reduced to writing and executed by the Parish, the Port and Unifab.
SECTION XVI
AUTHORITY TO EXECUTE
The Parish and the Port hereby warrant and represent to Unifab that
the persons executing this agreement on its behalf have been properly
authorized to do so by the Calcasieu Parish Police Jury as to its
representative, and the Lake Charles Harbor & Terminal District as to its
representative. Unifab hereby warrants and represents to the Parish and
the Port that as of the date of execution hereof no other person or entity
has any legal or beneficial interest in the property and that it has full
and complete power and authority to enter into this agreement and to agree
to the terms, provisions and conditions set forth herein and to bind the
Unifab Improvements as set forth in this agreement; that all legal actions
needed to authorize this execution, delivery and performance of this
agreement have been taken; and that neither the execution of this agreement
nor the performance of the obligations assumed by Unifab hereunder will (a)
result in a breach or default under any agreement to which Unifab is a
party or to which it or the Unifab Improvements is bound, or (b) violate
any statute, law, restriction, court order, or agreement to which Unifab or
the Unifab Improvements are subject.
The parties acknowledge that Unifab will be required in the future to
grant contractual and security interests in Unifab's leasehold estate at
the Industrial Canal in order to comply with its obligations for the
issuance of bonds to secure the funds required by Unifab to perform its
obligations under the terms of this Agreement and the Ground Lease
Agreement.
SECTION XVII
NO THIRD PARTY BENEFICIARIES
No claim as a third party beneficiary under this agreement by any
person, firm or corporation shall be made, or be valid, against the Parish
or the Port or Unifab.
IN WITNESS WHEREOF, Unifab has executed this Development Agreement, in
triplicate, at New Iberia, Louisiana, on this 24TH day of May, l999, in
the presence of the undersigned competent witnesses and me, Notary Public,
after due reading of the whole.
WITNESSES: UNIFAB INTERNATIONAL, INC.
/S/ PETER J. ROMAN BY: /S/ DAILEY J. BERARD
- ------------------- ------------------------
DAILEY J. BERARD
/S/ KELLY BROUSSARD UNIFAB INTERNATIONAL WEST, LLC
- ------------------- (FORMERLY PIM, LLC)
BY: /S/ DAILEY J. BERARD
------------------------
DAILEY J. BERARD
/s/ Louis Peltier
------------------------
NOTARY PUBLIC
IN WITNESS WHEREOF, the Parish has executed this Development
Agreement, in triplicate, at Lake Charles, Louisiana, on this 20TH
day of May, l999, in the presence of the undersigned competent witnesses
and me, Notary Public, after due reading of the whole.
WITNESSES: CALCASIEU PARISH POLICE JURY
/S/ JAMES J. VICKERS BY: /S/ DAVID ABSHIRE
- ----------------------- ----------------------
DAVID ABSHIRE, President
/S/ BRYAN C. BEAM
- ----------------------
/s/ James T. Richard
------------------------------
NOTARY PUBLIC
IN WITNESS WHEREOF, the Port has executed this Development Agreement,
in triplicate, at Lake Charles, Louisiana, on this 14TH day of May, l999,
in the presence of the undersigned competent witnesses and me, Notary
Public, after due reading of the whole.
WITNESSES: LAKE CHARLES HARBOR & TERMINAL
DISTRICT
/S/ BARBARA REED BY: /S/ GLENWOOD W. WISEMAN
- ------------------- ---------------------------
GLENWOOD W. WISEMAN
Executive Director
/S/ CHERYL ARNOLD
- -------------------
/s/ Sharon L. Edwards
-----------------------------
NOTARY PUBLIC