EXHIBIT 10.45
RESCISSION AND TERMINATION AGREEMENT (the "Agreement")
This Agreement is entered into this date by and between THE PORT OF CHELAN
COUNTY, a Washington municipal corporation, (the "Port") and PACIFIC AEROSPACE
ELECTRONICS, INC. a Washington corporation ("PAE") (individually a "Party" and
collectively the "Parties").
RECITALS
A. The Port has for some time been the owner and developer of industrial
property at Olds Station in Wenatchee, Chelan County, Washington
("Industrial Park"), with a history and philosophy of not selling industrial
(as opposed to retail or commercial) land, but rather controlling the real
property itself and leasing it to businesses and industries.
B. In 1993, the Port and PAE became landlord and tenant, respectively, of a
portion of the Industrial Park at Olds Station. Since that time, PAE has
grown from a relatively small employer of less than thirty (30) people, to a
major employer in Chelan County employing, at times, in excess of five
hundred (500) people.
C. As a unique arrangement with PAE, and recognizing the expansion, growth, and
family wage jobs supported by PAE, the Port made exception to its general
philosophy and sold portions of its industrial land to PAE to support its
expansion.
D. On January 15, 1999, the parties entered into a Real Estate Agreement (the
"Contract") whereby the Port agreed to sell to PAE three parcels of land at
the Industrial Park over a period of approximately three years.
X. XXX purchased the first of the 3 parcels ("Parcel 1") shortly after the
Contract was executed.
F. By agreement formalized September 22, 1999, the parties agreed to extend
periods for closing the purchase of the second of the 3 parcels ("Parcel 2")
and the third of the 3 parcels ("Parcel 3") for a period of one year.
G. During the middle of 2000, PAE reexamined its position relative to acquiring
ownership of land for its future improvements and advised the Port that it
no longer felt compelled to acquire or own any of the 3 parcels of land
identified in the Contract, including Parcel 1 it had initially purchased,
suggesting that the parties undo the Contract arrangement and return to the
status quo relative to the ownership of property, as it was prior to January
15, 1999.
H. The Port understood if it did not agree to the termination and rescission of
the Contract and the repurchase of Parcel 1 from PAE, that PAE's choices
would be somewhat limited and would result in PAE purchasing Parcel 2 and
Parcel 3 and immediately placing all 3
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parcels for sale, an event which would be inconsistent with the Port's
general philosophy and goal.
I. The Port, desiring to keep control over the property in the Industrial Park
area, consistent with its then practice of owning and leasing industrial
land, agreed to purchase Parcel 1 from PAE for the amount initially paid by
PAE plus the actual costs of usable improvements placed on Parcel 1 by PAE.
J. The intent of the parties was to rescind the Contract and return Parcel 1 to
the Port for the amount paid to the Port by PAE plus PAE's actual out-of-
pocket expenses for the costs of usable improvements, and to terminate the
right of PAE to acquire Parcel 2 and Parcel 3, returning to PAE the
remainder of the xxxxxxx money deposit.
K. In the interest of time, the parties memorialized and accomplished the
return of Parcel 1 to the Port, by the Port purchasing Parcel 1, but did not
memorialize or complete the termination of the balance of the Contract or
the return of the xxxxxxx money to PAE.
L. The balance of the xxxxxxx money deposited by PAE pursuant to the contract,
being One Hundred Thousand and No/100 Dollars ($100,000), has been earning
interest which has accrued to and been reported as income for income tax
purposes by PAE.
M. The Port has never exercised dominion or control over the xxxxxxx money and
has never accounted for or shown the xxxxxxx money deposit as a Port asset.
The Port agrees it was the intent of the parties to terminate PAE's right to
purchase Parcels 2 and 3 and to return the xxxxxxx money to PAE in exchange
therefor and in exchange for PAE returning Parcel 1 to the Port for the
amount expended by PAE for the property.
N. The parties intend by this Agreement to complete the commitments made in
2000, by formally terminating the Contract and returning XXX'x xxxxxxx money
to PAE.
AGREEMENT
1. Recitals. The foregoing recitals are incorporated herein as though fully
set forth herein.
2. Rescission and Termination of Previous Agreement. The Real Estate Agreement
between the parties dated January 15, 1999, and Addendum thereto, including the
Addendum dated September 22, 1999, is rescinded and terminated effective August
1, 2000, to the extent not already performed by the parties at that time.
3. Previous Understanding and Agreement Memorialized. The parties understand
and agree that this Agreement memorializes the previous understanding and
agreement made by the parties to terminate and rescind the Contract, eliminating
PAE's right to purchase Parcel 2 and Parcel 3 identified in the Contract and
returning to PAE the balance of the xxxxxxx money deposit, plus any accumulated
interest thereon earned from the xxxxxxx money deposit.
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4. Taxable Income. PAE has reported and shall report all taxable income
generated from the xxxxxxx money deposit as income on PAE's income tax returns
and shall be responsible for paying all taxes, costs and fees related to such
xxxxxxx money deposit.
5. Balance of Xxxxxxx Money. The balance of the xxxxxxx money deposit plus
earned interest, shall be paid to PAE promptly following the execution of this
Agreement.
6. Reimbursement by PAE. As rescission of the Contract was initially
requested by PAE, PAE shall reimburse the Port for, or pay directly, all costs
and fees incurred by the Port involved with this Agreement including, without
limitation, the costs and fees of document preparation.
7. All Matters Resolved. The execution of this Agreement resolves all matters
related to the Contract and Parcels 1, 2 and 3 in a manner satisfactory to the
parties. Each party releases the other from any and all liabilities and
opportunities related to the Contract, including, without limitation, the right
of PAE to complete the purchase of Parcels 2 and 3 and the right of the Port to
have retained any xxxxxxx money deposit in the event the purchases of Parcels 2
and 3 were not closed within the agreed upon time in the Contract, as extended.
8. Entire Agreement. This Agreement contains the entire Agreement of the
Parties hereto, and except for any Agreements or warranties otherwise stated in
writing to survive the execution and delivery of this Agreement, supersedes all
other previous understandings and agreements, written and oral, with respect to
this transaction.
9. Savings Clause. Nothing in this Agreement shall be construed as to require
any act contrary to law, and wherever there is any conflict between the
provisions of this Agreement and any statute, law, public regulation or
ordinance, the latter shall prevail, but in such event, the provisions of this
Agreement affected shall be curtailed and limited only to the extent necessary
to bring it within legal requirements.
Date: 7-31-01 Date: 7-27-01
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Port of Chelan County Pacific Aerospace & Electronics, Inc.
By: /s/ Xxxx Xxxxxx By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxx Xxxxxx Name: Xxxxxx X. Xxxxxx
Its: Executive Director Its: President & CEO
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