CORPORATE JOB CREATION
AGREEMENT
This Corporate Job
Creation Agreement (“Agreement”) is entered into as of
June ___, 2009, by and between the Pearland Economic Development
Corporation of Pearland, Texas (the “PEDC”), and
Cardiovascular Systems Inc., having its principal place of business
at 650 Campus Drive, St Paul Minnesota (the “Company”),
for the establishment of a manufacturing and distribution facility
in Pearland, Texas (hereinafter collectively referred to as the
“Parties”).
“All
Documents” means this Agreement; the Texas Enterprise Fund
contract between the Company and the State of Texas Governors
Office; the Skills Development Fund contract between the Company
and the State of Texas Workforce Commission; and the Building Lease
(as defined below).
“Building
Lease” means the Ground and Building Lease with the PEDC, as
Landlord, and the Company, as Tenant, for the Facility (as defined
below).
“Commencement Date” means shall have
the same date as defined in the Building Lease.
“Comprehensive Benefits” means a
healthcare benefit plan including those benefits generally
described in Exhibit A and where the Company agrees to offer
to pay at least 50% of the cost for each employee who chooses to
participate in the Company sponsored plan
“Contract
to Hire” means those individuals working on a contract basis
for the Company and the Company has the option to hire those
individuals as full time employees after a specified period of time
usually three to six months, but a maximum of twelve
months
“Corporate Personnel” means
employees other than Direct Labor and includes executive,
administrative, sales and marketing, engineering, quality managers,
customer service, IT, and clerical personnel.
“Default
means the planned reduction in the Company’s work force,
after the First Year of Operation, resulting in the Company having
fewer than twenty-five FTEs at the Facility for more than 120
consecutive days.
“Direct
Incentives” has the meaning specified in
Section 4.03.
“Direct
Labor” means employees holding jobs requiring some manual
labor and moderate technical knowledge and involving the direct
handling of products manufactured or assembled by the Company,
either during or after the manufacturing or assembly process.
Theses employees would include, but not be limited to, assemblers,
team leads, QC techs, QA techs, shipping / receiving specialists,
material handling / inspection specialists, etc.
“Facility” means the building in
Pearland, Texas to be constructed by the PEDC and leased to the
Company pursuant to the Building Lease.
“Full
Time Equivalent Employee” or “FTE” means one
person working a total of 30 hours or more per week for
26 weeks or more per year. FTE’s may be employees of the
Company or those working in the “Contract to Hire”
evaluation phase of employment.
“Job” means employment for one
FTE.
“First
Year of Operation” means the period of time beginning
90 days after the Commencement Date, as defined in the
Building Lease, and ending 365 days later.
“Second
Year of Operation” means the period of time beginning one
year after the beginning of the First Year of Operation and ending
two years after the beginning of the First Year of
Operation.
“Third
Year of Operation” means the period of time beginning two
years after the beginning of the First Year of Operation and ending
three years after the beginning of the First Year of
Operation.
“Fourth
Year of Operation” means the period of time beginning three
years after the beginning of the First Year of Operation and ending
four years after the beginning of the First Year of
Operation.
“Fifth
Year of Operation” means the period of time beginning four
years after the beginning of the First Year of Operation and ending
five years after the beginning of the First Year of
Operation.
PART
II: PROJECT DESCRIPTION
Subject to the
satisfaction of the contingencies set forth herein and performance
of the PEDC’s obligations hereunder and under the Building
Lease, the Company shall locate a manufacturing and distribution
facility in Pearland, Texas. The Company intends to create a
minimum 250 jobs by the end of the Fifth Year of Operation in the
Pearland Facility. All employees will receive Comprehensive
Benefits. In support of the Facility, the Company shall hire at
least 90% of its Direct Labor and at least 70% of its new Corporate
Personnel from the Houston/Sugarland/Baytown Metropolitan
Statistical Area (“HMSA”), unless qualified personnel
cannot be found within the HMSA. Attached hereto as Exhibit B
is the definition of the area served by HMSA.
PART
III: CONSTRUCTION AND LEASE OF
FACILITY
The PEDC shall
finance and complete the construction of the Facility, in
accordance with the Building Lease within the committed time
frame.
PART
IV: TERMS AND CONDITIONS OF JOB
CREATION
§4.01 The
Texas Enterprise Fund
This project is
induced by the Texas Enterprise Fund program (TEF) and Skills
Development Fund. The Company has applied for the TEF. The terms
and conditions of this agreement are subject to the successful
approval of the TEF award in the amount of $1.5 million. The
PEDC has committed, by resolution, to guarantee this award amount
and shall make payment to the Company for the difference between
$1.5 million and the actual award from the State of Texas.
This amount is expected to be an amount of $750,000. The payment of
the difference from $1.5 million and the actual award from the
State of Texas will be made in three (3) equal installments.
The first installment payment will be due to the Company on the
earlier of (i) the date the Company takes occupancy of the
Facility or (ii) the date the Facility is “Substantially
Complete”, as such term is defined in the Building Lease. The
remaining two installment payments will be paid to the Company on
the first and second anniversaries of the date that the first
installment payment was due to the Company. The PEDC shall provide
its full financial support for the local government portion of the
Job Creation Agreement.
§4.02 Employment-Related
Performance Guarantees
(a)
Comprehensive Benefits . The
Company shall offer Comprehensive Benefits to each of the
Company’s employees and shall provide such Comprehensive
Benefits to every employee who elects to receive them from the
Company.
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(b)
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Employment Levels
. The
Company intends to hire and retain at least 250 FTE’s at the
Pearland facility within five (5) years. It is anticipated
that new hires of FTEs per year will be as follows:
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