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Home My WebLink About7/30/2008 - STAFF REPORTS - 2.P. ��PpLM Sp4 iy u m TMenYc CITY COUNCIL STAFF REPORT DATE: July 30, 2008 CONSENT CALENDAR SUBJECT: Assignment of FMC Technologies-Airport Services Passenger Loading Bridge Maintenance Agreement to JBT Corporation FROM: David H. Ready, City Manager BY: Department of Aviation SUMMARY The Airport relies on the special expertise of a nationally recognized service firm for the major repair and maintenance of the eight jet passenger boarding bridges. This action will assign the service agreement of the existing vendor to its new "spin-off' wholly- owned subsidiary. RECOMMENDATION: 1. Authorize assignment of Agreement 5239 with FMC Technologies to JBT Corporation, without change to the terms and conditions of the agreement. 2. Authorize the City Manager to execute all necessary documents. STAFF ANALYSIS: On March 1, 2006, City Council approved an award of contract to FMC Technologies, for maintenance and repair services to 8 Airport passenger loading bridges. The contract is for a term of 3 years, for a total of $128,484.09, with 2 additional one-year renewal periods. FMC Technologies recently contacted the Airport via letter (see attached) to advise their intention to spin-off JBT Corporation, its subsidiary which includes the Airport Services Division. The July 9, 2008 letter from FMC indicates that all terms and conditions of the agreement will remain unchanged and this has been verified by the City Attorney. Staff is of the expectation that this will be a seamless transition and there will be no change in the cost, terms and conditions of the agreement, contractor staff, or method of service delivery. OTEM NO. City Council Staff Report July 30, 2008 - Page 2 FMC Technologies—Contract Assignment to JBT Corp. FISCAL IMPACT: There is no fiscal impact anticipated as a result of the assignment of Agreement No. 5239 from FMC Technologies to JBT Corporation. _ L Thomas Nolan, Executive Director, Airport 1 David H. Ready, City Attachment: FMC Assignment letter dated July 9, 2008 d�0aCl2 AIRPORT SERVICES 1805 West 2550 South Ogden, UT 84401 Phone 801 629-3119 Fax 801 629-3487 IFMC echnologles July 9,2008 Mr. Craig Toms RECTO v DJ City of Palm Springs 3400 E. Taltquitr Canyon Way �(!�.- 10 2908 Palm Springs, CA 92263-2743 Dear Mr,Toms; FM: Agreement for Contract Services, dated March 6, 2006, between FMC 'Technologies Inc.and the City of Palm Springs ("the Agreement") The Board of Directors of FMC Technologies,Inc- ("FMC Technologies")has announced its intention to spin-off John Bean Technologies Corporation ("JBT Corporation"), a wholly owned subsidiary of FMC Technologies. Following the spin-off, FMC Technologies' business will consist entirely of the Energy Systems business, while the newly formed JBT Corporation will comprise the former FoodTech and Airport Systems business segments of FMC Technologies. This separation will allow FMC Technologies to concentrate on its rapidly growing energy businesses, while FoodTech and Airport Systems will have the appropriate resources and management focus to more effectively serve their distinct customer base. The Energy Systems business will remain in the currently existing legal entity known as FMC Technologies Inc-, while the FoodTech and Airport Systems business, which includes the Airport Services, will be operated by JBT Corporation. When JBT Corporation begins operations (expected around 30 June 2008), it will be a wholly-owned subsidiary FMC Technologies. After the spin-off occurs,JBT Corporation will be fully independent from FMC Technologies. For background purposes, we include excerpts from the Form 10 that JBT Corporation filed with the United States Securities and Exchange Commission describing the transaction. This Form 10 has a complete set of financial statements for JBT Corporation. It is therefore proposed that, with an effective date of 30 June 2008, the FoodTech and Airport Systems businesses will move to JBT Corporation. Yn order to effect this change, we propose to transfer the above Agreement with you to JBT Corporation effective 30 June 2008,and from that date the Agreement will be performed by JBT Corporation. Please note that we value your business and we are not proposing to make any change to the quality or performance of the services and work currently carried out tinder the Agreement. The services provided under the Agreement will continue to be performed as previously and you will continue to receive our prompt attention at all times. In particular, the proposed transfer of the Agreement should not have any impact on the day-to-day performance of the services, as the personnel who are currently providing the services will be transferred over to JBT Corporation. 0600,1 3 Tinder the assignment clause of the Agreement, your consent is required for any assignment of the services currently provided by us under the Agreement. Accordingly, we write to request your consent and approval to the assignment of the Agreement to John Bean Technologies Corporation. Aside from the assignment of this Agreement to JBT Corporation, all terms and conditions of the Agreement remain unchanged and JBT Corporation assumes all rights, obligations and duties ofFMC under the Agreement. Kindly confirm your consent, approval and confirmation of the above by signing the enclosed copy of this letter in the place indicated below and returning it to us by fax on (801) 629-3487. Please also send the original by mail to us at the fallowing address for our records: FMC Technologies—Airport Services ATTN: Debbie Larsen 1805 West 2550 South Ogden, UT 84401 Pending our receipt of your signed copy or this letter, we shall continue to perform the contract in the same way and on the same terms as previously. Fallowing receipt of your signed copy of the letter, the services to be provided under the Agreement shall be performed by John Bean Technologies Corporation in place of FMC Technologies,Inc. If you have any questions or concerns about the proposed changes outlined above, please contact Mr. Brent Ahlstrom, VP Operations,by telephone at(801)510-1787,by fax to(801)629-3487,or by email at Brent-ahlstrorna,fmcti.com. Thank you for your assistance. urs faithfully, 13arbaraHH For and on behalf of FMC Technologies Inc. Acknowledgment and Consent- We hereby acknowledge receipt of this letter and confirm our approval and consent to the transfer of the above Agreement. .................. ............... For and on behalf of City of Palm Springs W3374483 vl rage 2 of 2 l� ��