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Big Sky Economic Development Trust Fund Program Application Guidelines Montana Department of Commerce Appendix B, Page 1 2009 Category I – Economic Development APPENDIX B: SUB-RECIPIENT AGREEMENT MONTANA DEPARTMENT OF COMMERCE BIG SKY ECONOMIC DEVELOPMENT TRUST FUND CATEGORY I: ECONOMIC DEVELOPMENT PROJECTS DRAFT THIS AGREEMENT is entered into this day of 2010, by the City of Missoula, herein referred to as the City and the Missoula Area Economic Development Corporation, a nonprofit local economic development corporation herein referred to as the “Sub-recipient.” WITNESSETH THAT: WHEREAS, the City of Missoula is the recipient of a Big Sky Economic Development Trust Fund (BSTF) grant by the Montana Department of Commerce, Business Resources Division herein referred to as “the Department,” and WHEREAS, the purpose of the grant is to assist WGM Group, Inc. with the creation of 3 new jobs for the residents of the City of Missoula, and WHEREAS, the City desires to sub-grant the BSTF funds to the Sub-recipient and engage the Sub- recipient to assist WGM Group, Inc. with the creation of 3 new jobs on the City’s behalf, and WHEREAS, the Department has required the City to enter into a Sub-recipient agreement with the Sub- recipient specifying the terms and conditions of the City’s delegation of certain BSTF responsibilities to the Sub-recipient, and WHEREAS, the parties to this Agreement understand that neither of them has in any way, expressly or impliedly, abrogated any of its individual powers, and further agree that this Agreement does not create any new organization or legal entity. NOW, THEREFORE, in consideration of the mutual covenants and conditions set out in this Agreement, the parties agree as follows: A. SPECIAL PROVISIONS. The City agrees, under the terms and conditions of this Agreement, to sub-grant BSTF funds to assist WGM Group, Inc. with the creation of 3 new jobs to the Sub-recipient. B. INDEPENDENT SUB-RECIPIENT. It is understood by the parties hereto that the Sub-recipient is an independent Sub-recipient and that neither its principals nor its employees, if any, are employees of the City purposes of tax, retirement system, or social security (FICA) withholding. It is further understood that pursuant to section 39-71-401, MCA, the Sub-recipient has obtained, and will maintain at its expense for the duration of this Contract, coverage in a workers' compensation plan for its principals and employees for the services to be performed hereunder. C. COMPENSATION. Neither the cost of architectural, engineering, or grant administrative services plus a percentage of that cost method, nor the percentage of construction cost method will serve as the basis for compensating the Sub-recipient for its services provided under this Contract. Activity Based Compensation: For the satisfactory completion of the services to be provided under this Contract, the City will pay the Sub-recipient a sum not to exceed $1,125 as in the manner set forth in the attached Exhibit C, which by this reference is made a part of this contract. Each specific service the Sub-recipient will provide under ---PAGE BREAK--- Big Sky Economic Development Trust Fund Program Application Guidelines Montana Department of Commerce Appendix B, Page 2 2009 Category I – Economic Development this contract, and the maximum amount that the City will pay the Sub-recipient for each of these services, is set forth in the attached Exhibit C. D. SCOPE OF SERVICES. The Sub-recipient will perform the following services: It is understood and agreed by the parties that the services of the Sub-recipient do not include any of the following: the disbursement or accounting of funds distributed by the City’s financial officer, legal advice, fiscal audits or assistance with activities not related to the BSTF project. 1. The Sub-recipient will be responsible for all facets of the BSTF project as described in the City’s BSTF application. 2. During the period of this Agreement, the Sub-recipient will maintain reasonable records of its performance under this Agreement in a manner consistent with generally accepted accounting principles. The Sub-recipient will allow the City or their authorized representatives access to these records at anytime during normal business hours. At the request of the City, the Sub-recipient will submit to the City, in the format prescribed by the City, status reports on its performance under this agreement. 3. If the Sub-recipient ceases to exist or an Event of Default occurs, all grant funding on hand and accounts or notes receivable related to this agreement, will revert to the City. E. DURATION OF THE AGREEMENT. This Agreement will become effective upon authorization by the Missoula City Council and the Missoula Area Economic Development Corporation Board of Directors and approval by the Department. This Agreement will terminate if either party fails to meet the conditions of this Agreement or if an Event of Default occurs. F. ADMINISTRATION. 1. For the purposes of implementing this Agreement, the City will appoint a local government project liaison that will work with the Sub-recipient. The parties will meet as necessary to provide for the efficient and smooth implementation of this Agreement and the activities contained herein. This Agreement will run concurrently with the Management Plan, which governs the management of the initial BSTF grant, and will follow the Management Plan for issues related to the initial grant. 2. The Sub-recipient will comply with all applicable federal and state statutes and regulations. 3. The BSTF project will be audited on a yearly basis. G. CONFLICT OF INTEREST. The Sub-recipient covenants that it presently has no interest and will not acquire any interest, direct or indirect, in the BSTF project, which would conflict in any manner or degree with the performance of its services hereunder. The Sub-recipient further covenants that, in performing this Contract, it will employ no person who has any such interest. H. DISPOSITION OF FUNDS ACQUIRED. Upon the expiration of the Agreement, the Sub-recipient will transfer to the City any BSTF funds on hand at the time of expiration and any accounts receivable attributable from the use of BSTF funds. I. DOCUMENTS INCORPORATED BY REFERENCE. The City’s application to the Department for BSTF funding, 2010, and all applicable federal and state statutes and regulations are incorporated into this Contract by this reference and are binding upon the Sub-recipient. ---PAGE BREAK--- Big Sky Economic Development Trust Fund Program Application Guidelines Montana Department of Commerce Appendix B, Page 3 2009 Category I – Economic Development J. OWNERSHIP AND PUBLICATION OF MATERIALS. All reports, information, data, and other materials prepared by the Sub-recipient pursuant to this Contract are the property of the City and the Department which have the exclusive and unrestricted authority to release, publish or otherwise use, in whole or part, information relating thereto. Any reuse without written verification or adaptation by the Architect/Engineer for the specific purpose intended will be at the Owner's sole risk and without liability or legal exposure to the Architect/Engineer. No material produced in whole or in part under this Contract may be copyrighted or patented in the United States or in any other country without the prior written approval of the City and the Department. K. REPORTS AND INFORMATION. The Sub-recipient will maintain accounts and records, including personnel, property and financial records, adequate to identify and account for all costs pertaining to this Contract and such other records as may be deemed necessary by the City to assure proper accounting for all project funds. These records will be made available for audit purposes to the City or its authorized representative, and will be retained for three years after receipt of final payment for the services rendered under this Contract unless permission to destroy them is granted by the City. L. ACCESS TO RECORDS. It is expressly understood that the Sub-recipient's records relating to this Contract will be available during normal business hours for inspection by the City, the Department, and, when required by law, the Montana Legislative Auditor and Legislative Fiscal Analyst. M. INDEMNIFICATION. The Sub-recipient waives any and all claims and recourse against the City, including the right of contribution of loss or damage to person or property arising from, growing out of, or in any way connected with or incidental to the Sub-recipient’s performance of this Agreement, except claims arising from the concurrent or sole negligence of the City or its officers, agents or employees. The Sub-recipient will indemnify, hold harmless, and defend the City against any and all claims, demands, damages, costs, expenses, or liability arising out of the Sub-recipient’s performance of this Agreement except for liability arising out of the concurrent or sole negligence of the City or its officers, agents, or employees. N. TERMINATION OF AGREEMENT. If any of the following events occur, the City may, in its sole discretion, declare such event a default under this Agreement: 1. Any representation or warranty made by the Sub-recipient in this Agreement or in any request or certificate or other information furnished to the City under this Agreement proves to have been incorrect in any material respect; or 2. The Sub-recipient fails in any material respect to carry out its obligations under its proposal to the City for the assistance provided under this Agreement. If the Sub-recipient fails to perform any of its duties under this Agreement or if any Event of Default occurs, the City may declare the Sub-recipient to be in default and thereafter give the Sub-recipient written notice setting forth the action or inaction which constitutes the default and giving the Sub-recipient 45 days in which to correct the default. If the Sub-recipient fails to correct the default within 45 days of receipt of this notice, the City may notify the Sub-recipient in writing that any amount that is payable under this Agreement is due and payable in full within 45 days and this Agreement is terminated. It is agreed by the parties that the provisions of this Agreement provide for reasonable and sufficient notice to be given to the Sub-recipient in case of the Sub-recipient’s failure to comply with any of its covenants and that this notice is sufficient for the Sub-recipient to rectify its actions or inactions of default. ---PAGE BREAK--- Big Sky Economic Development Trust Fund Program Application Guidelines Montana Department of Commerce Appendix B, Page 4 2009 Category I – Economic Development The waiver by the City of any default by the Sub-recipient does not constitute a waiver of a continuing breach or a waiver of a subsequent breach. Any agreement contrary to this Agreement is not binding upon either party unless it is in writing and signed by both parties. O. CONSTRUCTION AND VENUE. This Agreement will be construed under and governed by the laws of the State of Montana. The City and the Sub-recipient agree that performance of this Agreement is in the County of Missoula, State of Montana and that in the event of litigation concerning it, venue is in the District Court of the 4th Judicial District in and for the County of Missoula, Montana. P. ELIGIBILITY. The Sub-recipient certifies that the Sub-recipient's firm and the firm's principals are not debarred, suspended, voluntarily excluded, or otherwise ineligible for participation in State of Montana contracts. This Sub-recipient Agreement has been approved by the Misoula City Council and the Missoula Area Economic Development Corporation’s Board of Directors. IN WITNESS THEREOF, the parties hereto have caused this Agreement to be executed. City of Missoula Missoula Area Economic Development Corporation: Mayor John Engen Richard C. King, President/CEO Date Date Attest: Attest: ---PAGE BREAK--- Big Sky Economic Development Trust Fund Program Application Guidelines Montana Department of Commerce Appendix B, Page 5 2009 Category I – Economic Development Exhibits: Exhibit – BSTF Grant Contract between the Department of Commerce & the City of Missoula. Exhibit – Management Plan for the Project (between the City of Missoula and the Sub-recipient, as approved by the Department of Commerce)