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HomeMy WebLinkAboutDevelopment Agreeement- Aviatation Plaza Project111111111111111dl Development Agreement Document Number I Document Title Development Agreement between the City of Oshkosh, Wisconsin, a municipal corporation (the "City'), and Rogan Store Oshkosh LLC, a limited liability company (the "Developer' DOC# 1802025 NATALIE STROHMEYER REGISTER OF DEEDS WINNEBAGO COUNTY, WI RECORDED ON: 10/25/2019 01:43 PM RECORDING FEE: 30.00 PAGES: 26 and Return Address C (4A4e ^c C 2 `f f, City Attorney's Office 913-2310-0404 Parcel Identification No. Lot 2 of Certified Survey Map 5964 recorded with the Winnebago County Register of Deeds on September 7, 2006 in Volume 1 of Certified Survey Maps on Page 5964 as Document No. 1410416. Said land being in the City of Oshkosh, County of Winnebago, State of Wisconsin. Drafted By: Lynn Lorenson Oshkosh, WI54903-1130 RECEIVED NOV - 5 2019 CITY CLERK'S OFFICE TAX INCREMENTAL DISTRICT NO.37 DEVELOPMENT AGREEMENT (AVIATION PLAZA PROJECT) This Development Agreement (the "Agreement") is made this Ali' day of September, 2019 (the "Effective Date"), by and between the CITY OF OSHKOSH, WISCONSIN, a Wisconsin municipal corporation (the "C�" ), and ROGAN STORES OSHKOSH LLC a Wisconsin limited liability company (the "Developer"). RECITALS WHEREAS, the City has established Tax Incremental District No. 37 (the "District") as a district in which at least fifty percent (50%) of the property within the District is in need of rehabilitation or conservation work, as defined in Wis. Stat. Sec. 66.1337(2m)(a), and in which certain costs incurred for redevelopment of the District may be reimbursed from property tax increment as provided by State law; and WHEREAS, Developer owns a parcel of real property located within the District which is more particularly described on Exhibit A attached hereto (the "Developer Property"); and WHEREAS, Developer, together with Masters Oshkosh, LLC ("Masters") and Oshkosh Refurb, Inc. ("Extreme Customs"), as the owners of all of the parcels within the District, intend to redevelop the District by (i) constructing a 35,600 square foot Mineshaft restaurant and family entertainment center, (ii) remodeling a 62,435 square foot Extreme Customs, LLC, automotive facility consisting of retail, office, installation, and warehouse space, and (iii) installing certain common and separate infrastructure and site improvements, all in accordance with applicable City ordinances and City -approved plans (the "Project'); and WHEREAS, to promote such development, the City created the District to assist in the financing of the costs of certain improvements, development incentives, and other costs associated with the ownership and development of properties located in the District; and WHEREAS, Developer would not undertake the development of its portion of the Project (as more specifically defined below, the "Developer Project") but for (i) its reliance upon the Developer receiving tax increment financing to assist in the funding of a portion of Developer's Project, (ii) each of Masters and Extreme Customs also undertaking the development of their respective portions of the Project, and (iii) each of Masters and Extreme Customs receiving tax increment financing to assist them in the funding of their portions of the Project; and WHEREAS, the City is authorized to enter into contracts necessary and convenient to implement the purpose of a Tax Incremental District, including the ability to provide development incentives and cash grants to owners,. lessees, or developers of land located within the District; and WHEREAS, the uses of the Developer Property and the District contemplated by this Agreement are necessary and desirable to serve the interests of the City and its residents by expanding the tax base of the City, providing additional development and employment opportunities, and providing a financing mechanism to expand and acquire necessary 20960394.5 infrastructure, all consistent with the purpose of a Tax Incremental District under Section 66.1105, Wisconsin Statutes; and WHEREAS, based upon the City's desire to redevelop the District and to obtain the economic benefits to be generated from the Project, the City is willing to enter into this Agreement. NOW THEREFORE, in consideration of the recitals, the terms and conditions contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: AGREEMENT I• DEFINITIONS. For purposes of this Agreement, the following terms shall have the following meanings: A. Agreement. "Agreement" means this document and all of its component parts and exhibits. B. Affiliate. "Affiliate" means any entity majority owned and controlled by, in control of, or under common control with Developer or any entity of which Developer is a subsidiary or which is a shareholder of Developer. An Affiliate includes, but is not limited to, an entity with which Developer merges or into which Developer consolidates, or which acquires all or substantially all of the common stock or assets of the Developer. C. Available Tax Increment. "Available Tax Increment" means an amount equal to ninety percent (90%) of the annual gross Tax Increment revenues actually received and retained by the City which are generated by the District and improvements and personal property therein in the immediately preceding calendar year. D. City Contribution. "City Contribution" means payments to be provided from the City to the Developer from the Available Tax Increment pursuant to the terms of this Agreement, in a total principal amount not to exceed the amount of Reimbursable Project Costs (as that term is defined below), together with interest at the rate of 5.25% commencing on the date of issuance of the City MRO. E. City MRO. "City MRO" means the Municipal Revenue Obligation issued by the City to the Developer as evidence of the City's limited obligation to pay the City Contribution, in substantially the form of Exhibit D attached hereto and incorporated herein. The City MRO shall be issued pursuant to Section 66.0621 of the Wisconsin Statutes, shall not constitute an indebtedness of the City, and shall be payable, subject to contingencies, solely from the limited sources and to the extent provided in this Agreement and the City MRO. F. Developer Project. "Developer Project" means the construction of certain water, sanitary sewer, and storm water improvements on or adjacent to the Developer Property. G. Developer Property. "Developer Property" means the parcel of real property described on Exhibit A attached hereto. 20960394.5 H. en and 100 Developer's Share" rcent(13%), representing the of Available Tax Increment paid each year to Developer. 1. District. "District" means all of that property, including the Developer Property, included in Tax Incremental Finance District No. 37 as described in the Project Plan. J. Grant. "Grant" means that certain Wisconsin Economic Development Corporation ("WEDC") Idle Sites Grant awarded to the City in the maximum amount of Five Hundred Thousand Dollars ($500,000.00), to be used to pay certain eligible Project Costs. K. Payment Dates. "Payment Dates" means November I of each year, commencing on the third November 1 after the Effective Date of this Agreement, up to and including November 1, 2047. L. Payment Term. "Payment Term" means the tern commencing on the first day of the third November after the Effective Date of this Agreement and continuing on the same day of each year thereafter until the first to occur of the following: (i) payment to Developer of the entire amount of the City Contribution, or (ii) November 1, 2047. For example, for illustrative purposes only, if the Effective Date is September 1, 2019, the Payment Term would run from November 1, 2021, through the first to occur of the following: (1) payment to Developer of the entire amount of the City Contribution; or (ii) November 1, 2047. M. Proiect Plan. "Project Plan" means the "Project Plan for the Creation of Tax Incremental Finance District No. 37 in the City of Oshkosh" prepared by Ehlers, Inc. dated [July 2, 2019], which is described on Exhibit B attached hereto and incorporated herein. N. Proiect Costs. "Project Costs" means the total of all hard costs and soft costs to be incurred by Developer, Masters, and Extreme Customs in constructing the Project, including all capital expenditures (or expenditures that could be treated as capital expenditures) and preliminary expenditures (such as architectural, engineering, environmental studies, surveying, soil testing, attorneys' fees and expenses, and similar costs that are incurred in connection with the construction of the Project), and all other direct and indirect costs of the development of the Project. O. Reimbursable Proiect Costs. "Reimbursable Project Costs" means the specific costs to be incurred by Developer with respect to the Developer Project described and set forth on Exhibit C attached hereto and incorporated herein. P. Tax Increment. "Tax Increment" has the same meaning as defined in Section 66.1105(2)(i) of the Wisconsin Statutes. Q. Tax Increment Law. "Tax Increment Law" means Section 66.1105 of the Wisconsin Statutes. II. INITIAL CONTINGENCY. The effectiveness of this Agreement is contingent upon Extreme Customs acquiring its portion of the District property and the City entering into Development Agreements with each of Developer, Masters, and Extreme Customs with respect to the Project. In the event that both Extreme Custom's acquisition of its portion of the District 20960394.5 Property and the City's approval of all three (3) Development Agreements have not occurred on or before September 30, 2019, this Agreement shall be null and void and the parties shall have no further rights or obligations hereunder. III. DEVELOPER'S OBLIGATIONS. A. Developer Project. Developer intends to invest not less than $302,147.00 to develop, construct, and use the Developer Project. B. Project Construction. Developer shall commence construction of the Developer Project on or before December 31, 2019. Once commenced, Developer shall diligently pursue completion of construction of the Developer Project in accordance with applicable City ordinances and City -approved plans for the Developer Property so that in any case construction shall be substantially completed by December 31, 2020. C. Costs and Expenses The Developer shall be responsible for all costs related to the Developer Project and any other work to be performed by the Developer under this Agreement, including all engineering, inspections, materials and labor. Furthermore, Developer shall be responsible for payment of all City fees including impact fees, building permit fees, zoning and sign permit fees, electrical and plumbing fees, and all other fees and expenses charged by the City in connection with the Developer Project. D. Work Within City RiAts of Way. To the extent that any portion of the Developer Project requires work within a City right of way, Developer will be solely responsible for obtaining all required City approvals for such work, for the cost of all right-of-way, excavation, and other permits necessary to perform such work, and the cost of any letter of credit, bond, or other security which the City requires to be posted in connection with work within City rights of way. All such work will be performed in accordance with applicable City specifications and plans approved by the City's Engineering Department. E. Verification of Project Costs,• Adjustment. Developer shall, upon completion of the Developer Project and, in any event, prior to March 31, 2021, submit to the City a complete accounting of its Reimbursable Project Costs, including all invoices and evidence of payment. As the Reimbursable Project Costs set forth on Exhibit C are based upon estimates and unapproved plans, the Developer and City recognize that the final Project Costs are not defined with certainty. Accordingly, to the extent that Developer's verified Reimbursable Project Costs are less than the amount set forth on Exhibit C, Exhibit C shall be revised to include such reduced amounts. In the event that Developer's verified Reimbursable Project Costs are greater than the amount set forth on Exhibit C, Developer may submit a request to the City to amend this Agreement to increase the amount of the City Contribution, and City staff will present such request to the City's Common Council. IV. CITY'S OBLIGATIONS. A. Chant. The City shall administer the Grant in accordance with the terms of that certain Redevelopment Agreement by and among the City, Thomas Masters, Rogan Stores LLC, Phoenix Realty, LLC, and Reilly Real Estate, LLC dated May 13, 2019 and recorded June 12, 2019 with the Winnebago County Register of Deeds as Document No. 1791305 and that certain 20960394.5 4 Idle Sites Redevelopment Grant Agreement between the WEDC and the City dated June 10, 2019. Developer's anticipated portion of the Grant is $79,826, but Developer acknowledges that the amount of the Grant is based upon Developer, Masters, and Extreme Customs (i) collectively incurring sufficient Developer Project Costs which are eligible for reimbursement under the terms of the Grant, and (ii) securing funds from non-WEDC sources sufficient to meet the matching funds requirement imposed by WEDC. Developer further acknowledges that Developer's portion of the amount of the Grant will be reduced if either (i) Developer does not incur sufficient Developer Project Costs which are eligible for reimbursement under the terms of the Grant, and/or (ii) Developer, Masters, and Extreme Customs do not secure sufficient matching funds. For purposes hereof, the City Contribution constitutes matching funds. Developer further acknowledges and agrees that to the extent that it receives less than $79,826.00 in Grant funds, that such shortfall is not a Reimbursable Project Cost and the City Contribution will not be increased to cover any such shortfall. B. City Contribution. In each year during the Payment Term, in consideration of the Developer undertaking its obligations under this Agreement, Developer's Share of the Available Tax Increment shall, subject to annual appropriations by the City Common Council, be applied to make payments under this Agreement to pay the Developer the City Contribution. The City Contribution constitutes eligible Projects Costs within the meaning of Section 66.1105(2) of the Wisconsin Statutes. The first payment shall not be made until the first day of the second November after the date of this Agreement provided that there is Available Tax Increment. Such payments shall be made in accordance with the terms of this Agreement, as further described in this Section IV.B. and the City MRO. The amount of the City Contribution shall be equal to the amount of Reimbursable Project Costs, and shall bear interest at the rate of 5.25% from the date of issuance of the City MRO. The City MRO shall be issued upon completion of the Project and verification by the City of Reimbursable Project Costs (and payment thereof) pursuant to Section III_E., above; provided, however, that regardless of issue date, interest will not begin to accrue on the City Contribution until January 27, 2021. The City Contribution shall be paid by the City only out of the Available Tax Increment, subject to the provisions of this Agreement and the City MRO. The City covenants and agrees as follows: (a) the City Manager or his designated representative shall include the payment of the entire Available Tax Increment for each year included during the Payment Tenn in the applicable budget request recommendation for the following year's budget, (b) if the City's annual budget does not in any year provide for appropriation of Available Tax Increment sufficient to make the payment due to Developer in that year, the City will use its diligent, good faith efforts to notify the Developer of that fact at least thirty (30) days prior to the date the budget is presented to the City Common Council for final approval, and (c) funds in the special fund of the District attributable to the Available Tax Increment generated from the District (and all improvements and personal property thereon) shall not be used to pay any other Project Costs until the City has applied to the payment due hereunder, in any year, the Available Tax Increment generated by the District (and all improvements and personal property thereon) that this Agreement provides will be applied to payment due hereunder. Developer acknowledges that, subject to the provisions of this Agreement: (i) all payments of Available Tax Increment are subject to the future annual appropriation of said amounts by the City Common Council to payment due hereunder; (ii) only the Available Tax Increment generated by the District (and all improvements and personal property thereon) shall be used to make payments to the Developer; and (iii) if, on November 1, 2047, the amount of the 20960394.5 5 Available Tax Increment to be paid under this Agreement proved insufficient to pay the entire City Contribution, the City shall have no obligation or liability therefor. The payment of the City Contribution shall be subject to the following conditions and limitations: 1. On each Payment Date during the Payment Term and subject to the provisions of this Agreement, the City shall pay a portion of the City Contribution equal to the Developer's Share of the amount of Available Tax Increment appropriated by the City Common Council for the payment due that Payment Tenn year. 2. The City shall take no action to terminate or dissolve the District early prior to November 1, 2047, unless the City first pays the outstanding balance due under the City Contribution, subject to the provisions of this Agreement, including, but not limited to, the annual appropriation of the City Common Council of such outstanding balance due. Attached hereto as Exhibit E is the City's projection of revenues and expenditures for the District over its tern, with the City Contribution labeled as "Municipal Revenue Obligation" thereon. Exhibit E is provided for illustrative purposes only, and Developer acknowledges that the amounts set forth thereon are estimates only. C. City Contribution not to be Considered Indebtedness. In no circumstances shall amount of the City Contribution due Developer hereunder be considered an indebtedness of the City, and the obligation of the City hereunder is limited to Developer's Share of the Available Tax Incrementwhichis appropriated by the City Common Council for payment of such amounts and only to the extent as provided in this Agreement. Amounts due hereunder shall not count against the City's constitutional debt limitation, and no taxes will be levied for its payment or pledged to its payment other than the Tax Increment which has been appropriated for that purpose. V. APPROVALS AND DEVELOPMENT STANDARDS. A. Approval of Public Bodies. The Developer shall obtain from the City and all other appropriate governmental bodies (and all other councils, boards, and parties having a right to control, permit, approve, or consent to the development and use of the Developer Property) all approvals and consents necessary for the City to approve the development of the Developer Property, and any other approvals necessary to utilize the Developer Property for the Developer Project. B. Acceptance of Agreement. The acceptance of this Agreement and granting of any and all approvals, licenses, and permits by the City shall not obligate the City to grant any additional approvals, including, but not limited to, variances, exceptions, or conditional use permits, or approve any building or use the City determines not to be in compliance with the applicable municipal codes and ordinances of the City. The City agrees to work in good faith, promptly, and diligently in connection with the issuance or grant of all such approvals, consents, Permits, certificates; and any other documents as may be necessary or desirable in connection with the development, utilization, and operation of the Developer Property and to act reasonably and expeditiously and in cooperation with the Developer in connection therewith; it being understood 20960394.5 and agreed that this provision is not intended to limit the rights of the City as more particularly set forth above or in Article VIII below. C. Development Requirements. The Developer shall use the Developer Property for the Developer Project and in accordance with the provisions of this Agreement, and all other applicable federal, state, county, and City laws and regulations. D. Tax Exemption Forbearance. Developer acknowledges that the City is relying upon the Developer's real property taxes to generate the Available Tax Increment to fund the City Contribution. As a result, the Developer agrees that during the Payment Term, neither the Developer nor any existing or future Affiliate or related entity of the Developer (collectively, "Develo er Affiliates") will pursue, assist, support or be involved in any federal, state, or local, judicial, legislative, or regulatory action or process that seeks, directly or indirectly, to prohibit, set aside, or limit the taxability of all or any portion of the Developer Property on any basis whatsoever, and the Developer for itself and on behalf of the Developer Affiliates, and each of their respective successors in interest, waives any and all rights thereto. In addition, during the period of time that commences upon the date of this Agreement and terminates at the end of the District, neither the Developer Property, the Developer Project nor any part thereof or interest therein shall be sold, transferred, leased, assigned, gifted, owned, used, or conveyed in any way to any person, partnership, organization, or entity that is all or partially exempt from federal or State of Wisconsin income taxes or real or personal property taxes, without the express prior written consent of the City, which such consent may be withheld in the City's sole and absolute discretion (collectively, the "Restrictive Covenant"). This Restrictive Covenant shall permit the City to have enforcement rights. Notwithstanding anything to the contrary contained herein, the Restrictive Covenant shall automatically terminate upon the conclusion of the Payment Term. VI. WARRANTIES AND REPRESENTATIONS. A. The Developer hereby warrants, represents, and covenants to the City: 1. The Developer is a duly organized and existing limited liability company in the State of Wisconsin and authorized to transact business in the State of Wisconsin. The sole member of the Developer is Rogan Shoes, Incorporated. 2. The execution, delivery, and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized and approved by the Developer, and no other or further acts or proceedings of the Developer or its member, directors, or officers are necessary to authorize and approve the execution, delivery, and performance of this Agreement, and the matters contemplated hereby. This Agreement, the exhibits, documents, and instruments associated herewith and made a part hereof, have, if applicable, been duly executed and delivered by the Developer and constitute the legal, valid, and binding agreement and obligation of the Developer, enforceable against the Developer in accordance with their respective terms, except as the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors' rights generally, and by general equitable principles. 20960394.5 3. "There are no lawsuits filed or, to the knowledge of the Developer, pending or threatened against the Developer or the Developer Property that may in any material way jeopardize the ability of the Developer to perform its obligations hereunder. 4. The Developer has sufficient funds through equity and debt financing sources to continuously operate, maintain, and fulfill the Developer Project. 5. The Developer shall provide, prior to execution of this Agreement, a (i) a certificate of good standing/current status issued by the appropriate government agency of the state of the Developer's organization, and (ii) resolutions of the Developer which provide for who is authorized to sign on behalf of the Developer and that the Developer is duly authorized to enter into this Agreement and undertake all of the obligations under this Agreement together with all other agreements, documents, and contracts required to be executed in connection with the transactions arising out of this Agreement. B. The City hereby warrants and represents to the Developer that: 1. Subject to the approval of City Common Council, the execution, delivery, and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized and approved by the City, and no other or further acts or proceedings of the City or its officials are necessary to authorize and approve the execution, delivery, and, subject to annual appropriation by the City Common Council, performance of this Agreement, and the matters contemplated hereby. This Agreement, the exhibits, documents, and instruments associated herewith and made a part hereof, have, if applicable, been duly executed and delivered by the City and constitute the legal, valid, and binding agreement and obligation of the City, enforceable against the City in accordance with their respective terns, except as the enforceability thereof may be limited by applicable law and as is otherwise subject to annual appropriation by the City Common Council. 2. No special assessments or other charges of any kind shall be assessed or levied against or accrue or come due from the Developer or the Developer Property with respect to the Reimbursable Project Costs. VII. CONDITIONS TO/LIMITATIONS ON THE OBLIGATIONS. Notwithstanding anything to the contrary set forth in this Agreement, the following are conditions to and limitations on each and all of the obligations of the City and the Developer under this Agreement, and the City and the Developer shall not be obligated to expend any amounts under this Agreement and may suspend or terminate this Agreement or the performance of any and all of its obligations under this Agreement, without recourse against the City or the Developer, if: A. The Wisconsin Department of Revenue fails to certify all or any portion of the creation of the District or the Project Plan ("Non -Certification"); provided, however, the City shall first make all reasonable efforts in good faith to cure such Non -Certification; or 8 20960394.5 B. The District is involuntarily terminated or dissolved ("Involuntary Termination"); provided, however, the City shall first make all reasonable efforts in good faith to cure such Involuntary Termination. VIIl. DEVELOPER: EVENT OF DEFAULT. A. Event of Default. An "Event of Default" is any of the following: 1. Failure to Construct the Developer Project. Subject to the terms of this Agreement, the Developer fails to construct the Developer Project consistent with Article III, above; or 2. Taxes. The Developer fails to pay any real or personal property tax or any special assessment levied or imposed by the State, County, or City against all or any portion of the Developer Property then owned by the Developer before they are delinquent, and in any event within ninety (90) days after written notice from the City of such failure; provided that the Developer shall have the right to contest the same in accordance with applicable law; or 3. Tax Exemptjon. All or any portion of the Developer Property becomes tax exempt; or 4. Breach of Agreement. The Developer breaches any provision of this Agreement or its obligations under this Agreement; provided, however, that written notice of the breach has been given to the Developer and the Developer has failed to cure such breach within sixty (60) days or such longer period as is reasonably required under the circumstances and the Developer has begun to cure such breach in good faith and is diligently continuing to cure such breach. 5. Continuous Operation. The Developer ceases to operate the Developer Project for a period of sixty (60) consecutive days for reasons other than casualty, remodeling, or Force Majeure. B. City Options upon Event of Default. Whenever an Event of Default occurs under Section VIII.A, the City may take one or more of the following actions, in the City's sole and absolute discretion: 1. Suspend or terminate the performance of any and all of its undertakings and obligations under this Agreement, including, but not limited to, making,any further payments under this Agreement during the pendency of the Event of Default. 2. Take any action, including legal or administrative action, at law or in equity, which may appear necessary or desirable to the City to enforce performance and observance of any obligation, agreement, or covenant of the Developer under this Agreement or to seek remedy for its breach. Such rights and remedies shall not be exclusive of any other remedy or remedies, and such rights and remedies shall be cumulative and shall be in addition to every other right and remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. 20960394.5 9 C. Delay in Exercise of Rights Not Waiver. No delay or omission to exercise any right or power accruing to the City or the Developer upon any default by the other party shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient as long as the default is continuing. D. Written Waiver Required. In the event this Agreement is breached by either party and such breach is expressly waived in writing by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous, or subsequent breach hereunder. A party's acquiescence in not enforcing any portion of this Agreement shall not provide a basis for the application of estoppel or other like defense or otherwise constitute waiver. Any waiver of any provision of this Agreement by the City must be express and in writing. E. Compensation for Costs of Breach. Whenever there is an Event of Default by the Developer hereunder, and the City employs attorneys or incurs other expenses for the collection of payment due or to become due for the enforcement or performance or observance of any obligation or agreement on the part of the Developer contained in this Agreement, the Developer shall, on demand thereof, pay to the City the reasonable fees of such attorneys and such other reasonable expenses incurred by the City. IX. EFFECT OF TERMINATION OF OTHER DISTRICT DEVELOPMENT AGREEMENTS. A. Initial Allocation of Available Tax Increment. Available Tax Increment shall be allocated among the three (3) Project developers as follows: Developer Reimbursable Project Costs Developer's Share of Available Tax Increment Developer $222,321.00 13.00% Masters $1,124,478.00 65.78% Extreme Customs $362,741.00 21.22% B. Reallocation. In the event that payments of a City Contribution under a development agreement entered into with respect to the Project are terminated due to a developer's default, such defaulting developer's share of Available Tax Increment shall be reduced to 0% and Developer's Share will be recalculated to equal the percentage which Developer's Reimbursable Project Costs bears to the Reimbursable Project Costs incurred by all non -defaulting developers, and future payments of the Available Tax Increment will be reallocated accordingly. X. MISCELLANEOUS PROVISIONS. 10 20960394.5 A. Incorooration of Attachments. All exhibits and other documents attached hereto or referred to herein are hereby incorporated in and shall become a part of this Agreement. B. Term. Unless terminated under Article VIII, above, the term of this unl Agreement shall begin as of the Effective Date and shall continue until November I, 2047, ess terminated earlier in accordance with the termination by the City of the District in accordance with the Tax Increment Law. C. Review and Inspections. The Citywill act diligently to review all necessary approvals, licenses, and permits and to undertake any inspections duly requested by the Developer. D. Restriction on Assignment of Agreement. I. A reern - The Developer may assign or transfer all of its rights under this Agreement to an Affiliate without the express prior written consent of the City only if the proposed Affiliate assignee or transferee agrees in writing to assume all of the Developer's obligations under this Agreement and the Developer provides the City with timely written notice and a copy of such fully executed assumption. Otherwise, upon an assignment or transfer of all of the Developer's rights under this Agreement to (i) a non -Affiliate, or ii an Affiliate that does not agree in writing to assume all of the Developer's obligations under this Agreement, this Agreement shall terminate at the option of the City and be of no further force or effect, except if the Developer obtains the express written consent of the City, which shall be in the sole and absolute discretion of the City. All of the rights and obligations under this Agreement must be assigned or transferred together, if at all, and may not be assigned separately. 2. Transfer of Property. The Developer may sell, assign, or transfer all or any portion of the Developer Property to an Affiliate without the express prior written consent of the City only if the proposed Affiliate assignee or transferee agrees in writing to assume all of the Developer's obligations under this Agreement, and the Developer provides the City with timely written notice and a copy of such fully executed assumption. Otherwise, upon a sale, assignment, or transfer of all or any portion of the Developer Property to (i) a non -Affiliate, or (ii) an Affiliate that does not agree in writing to assume all of the Developer's obligations under this Agreement, this Agreement shall terminate at the option of the City and be of no further force or effect, except if the Developer obtains the express written consent of the City, which shall be in the sole and absolute discretion of the City. E. Force Majeure. A party shall be excused from its obligations under this Agreement if and to the extent and during such time as the party is unable to perform its obligations or is delayed in doing so due to events or conditions outside of the party's reasonable control (each a "Force Majeure Event") based solely upon acts of God, war, fire, or other casualty, riot, civil unrest, extreme weather conditions, terrorism, strikes, and labor disputes. Upon the occurrence of a Force Majeure Event, the party incurring such Force Majeure Event will promptly give notice to the other party, and thereafter the parties shall meet and confer in good faith in order to identify a cure of the condition affecting its performance as expeditiously as possible. F. District Information. As soon as practicable, but no later than December 15 of each calendar year, the City shall provide to the Developer the information pertaining to the 20960394.5 11 Available Tax Increment for the calendar year of the request; provided, however, the City is only required to submit information in its possession and is not required to reply to any request prior to December 15 of any calendar year. G. Time of the Essence. Time is deemed to be of the essence with regard to all dates and time periods set forth herein and incorporated herein. H. Headings. Descriptive headings are for convenience only and shall not control or affect the meaning or construction of any provision of this Agreement. I. Delivery of Notices. Any notice required hereunder shall be given in writing, signed by the party giving notice, personally delivered, mailed by certified or registered mail, return receipt requested, sent by overnight delivery service, faxed or emailed to the parties respective addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section) as follows, provided any notice given by facsimile or email is also given by one of the other methods: To the City: City of Oshkosh City Attorney's Office 215 Church Avenue Post Office Box 1130 Oshkosh, WI54903-1130 Attn: City Attorney Facsimile No. 920-236-5106 Email: lIorenson(@,ci.oshkosh.iNri.us With a cony to: Godfrey & Kahn, S.C. 100 W. Lawrence Street Appleton, WI 54911 Attn: Michael J. Lokensgard Facsimile No. 920-830-3530 Email: mlokensgard@jzklaw.com To Developer: Rogan Shoes, Incorporated 1750 Ohio Street Racine, WI53405 Attn: Patrick A. Rogan Facsimile No. (262) 637-3319 Email: P.Ltr—ogan@roizansshoes.com and shall be deemed given upon personal delivery, the first business day after certification or registration, the first business day after deposit with the overnight delivery service, and upon acknowledgement of receipt by facsimile or email (provided notice is promptly sent by one of the other methods). J. Entire Agreement. This Agreement and the documents to be delivered hereunder constitute the sole and entire agreement of the parties to this Agreement with respect to 20960394.5 12 the subject matter contained herein, and supersede all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between this Agreement and the documents to be delivered hereunder, or the Exhibits, this Agreement will control. This Agreement may be modified only in writing signed by all parties. K. Law Applicable. This Agreement shall be construed in accordance with the internal laws of the State of Wisconsin. L. Originals and Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original. M. Amendments to Agreement. This Agreement shall not be amended orally but only by the written agreement of the parties signed by the appropriate representatives of each Party and with the actual authority of each party. N. Limitation on Liability. The parties acknowledge and agree that in carrying out any of the provisions of this Agreement or in exercising any power or authority granted to them thereby, there shall be no personal liability of either of the parties' officers, members, agents, employees, or representatives, it being understood and agreed that in such matters they act as agents and representatives of the applicable party. O. No Partnership. This Agreement specifically does not create any partnership or joint venture between the parties, or render any party liable for any debts or obligations of the other party. P. Recording of A eement. The parties hereto agree that at the City's option a memorandum of this Agreement, including reference to the Restrictive Covenant, may be recorded on the record title to the Developer Property. The Developer shall upon request of the City execute and deliver any such memorandum or other document in connection with such recording. Q. Developer's Obligations Run with the Land. The Developer's obligations under this Agreement and all consents, obligations, waivers, restrictions, and other requirements of the Developer as set forth in this Agreement, shall be deemed to be covenants running with the land and shall be binding upon the Property and the successors, assigns, and other transferees of the Developer. The rights and benefits conferred upon the Developer shall not be covenants running with the land and shall not inure to the successors, assigns, or other transferees of the Developer, except as set forth in Section X.D, above. R. Severance. If any portion of this Agreement is deemed invalid or unenforceable by a court of competent jurisdiction, then the remainder of this Agreement shall remain in full force and effect and enforceable to the fullest extent permitted by law. S. Third Parties. This Agreement is made for the exclusive benefit of the parties hereto, and their permitted assignees (as set forth in Section X.D.), and is not for the benefit of any other persons, as third party beneficiaries or otherwise, and this Agreement shall not be 20960394.5 13 deemed to have conferred any rights, expressed or implied, upon any other party, except as set forth in Section X.D. T. Neutral Construction. This Agreement is the result of a negotiated agreement by the parties and prior to the execution of this Agreement each party had sufficient opportunity to have review of the document by legal counsel. Nothing in this Agreement shall be construed more strictly for or against either party because that party's attorney drafted this Agreement or any portion thereof or attachment hereto. U. Headings. The headings inserted in this Agreement are for convenience only and in no way define, limit, or otherwise describe the scope or intent of this Agreement or any provision of this Agreement. [Signatures Begin On Next Page] 14 20960394.5 IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the date stated in the first paragraph of this Agreement. ROGAN STORES OSHKOSH LLC, by its sole member, ROGAN SHOES, INC ORATED BY: Patrick A. ogan, President of Rogan Shoes, Incorporated, Sole Member STATE OF WISCONSIN I )SS COUNTY OF RACINE } Personally came before me this ZS day of iV4-er 2019 the above -named Patrick A. Rogan, to me known to be the person who executed the foregoing instrument. W Jose J. M ator . No y Public, State of Wisconsin My Commission is permanent. 20960394.5 15 CITY OF OSHKOSH, WISCONSIN By: Mark A. Ro A. City Manager By: — 'j Pamela R. Ubrig, City Clerk . APProved. m 4A. ,r -, STATE OF WISCONSIN } COUNTY OF WINNEBAGO } SS Personally came before me this Ak4ay of 2019, the abgO named' City Manager and City Clerk, to me known to be the person who executed Q!.-fore ping instrument. J. NotaryPubl c, toV Wisconsin'•.. My Commission:0� �(° _a Da 3! 20960394.5 16 EXHIBIT A Description of Property Lot 2 of Certified Survey Map No. 5964 recorded with the Winnebago County Register of Deeds on September 7, 2006 in Volume 1 of Certified Survey Maps on Page 5964 as Document No. 1410416. Said land being in the City of Oshkosh, County of Winnebago, State of Wisconsin. Parcel No. 13-2310-0404 20960394.5 EXHIBIT B Description of Proiect Plan Tax Incremental District ("TID") No. 37 ("District") is a proposed district in need of rehabilitation or conservation consisting of five parcels and approximately 27 acres collectively referred to as the Aviation Plaza center located northwest of the intersection of W. South Park Ave. and S. Koeller Street and abutting Interstate 41. The existing commercial building in the District contains approximately 117,000 sq. ft. of retail space with Rogan's Shoes as the only current occupant following the closure of the J.C. Penney store in 2015. Masters Oshkosh LLC, Oshkosh Refurb, Inc., and Rogan Shoes, Incorporated (collectively, "Developer") have submitted a plan to redevelop the properties located within the District. The Developer's plan includes construction of a new 35,600 sq. ft. building that will operate as a Mineshaft restaurant and family entertainment facility, the renovation of the former J.C. Penney building, and the installation of new water, sanitary sewer, and storm water facilities (the "Project"). A portion of the renovated building would be occupied by Extreme Customs, LLC, a technology and automotive firm specializing in online sales of custom rims and tires. The Extreme Customs facilities will include retail, office, product installation, and warehousing space. General Development Plans and Specific Implementation Plans were approved for Extreme Customs on February 12, 2019 (Resolution 19- 91) and Mineshaft on May 28, 2019 (Resolution 19-319). The District will be created to pay incentives to reimburse the Developer for costs incurred related to the rehabilitation of public and private infrastructure and improvements. The Project represents an estimated $22.8 million investment in the site with approximately $500,000 to be funded with a WEDC Idle Sites Grant, $1.71 million to be funded with a development incentive funded by the District, and the balance from private investment 20960394.5 EXHIBIT C Reimbursable Project Costs Sewer and Water Storm Water TOTAL REIMBURSABLE PROJECT COSTS $222,321.00 20960394.5 EXHIBIT D CITY MRO UNITED STATES OF AMERICA STATE OF WISCONSIN COUNTY OF WINNEBAGO CITY OF OSHKOSH TAXABLE TAX INCREMENT PROJECT MUNICIPAL REVENUE OBLIGATION ("MRO") Number Date of Original Issuance Amount $[222,321.001 FOR VALUE RECEIVED, the City of Oshkosh, Winnebago County, Wisconsin (the "City"), promises to pay to ROGAN STORES OSHKOSH LLC (the "Developer"), or registered assigns, but only in the manner, at the times, from the source of revenue and to the extent hereinafter provided, the principal amount not to exceed $1222,321.001, with interest thereon at the rate of 5.25% per annum. Interest shall begin to accrue on January 27, 2021. This MRO shall be payable in installments on November 1 (the "Payment Dates") in each of the years set forth in Schedule 1 attached hereto in an amount equal to the Developer's Share of Available Tax Increment for the prior year provided such payments are due under the Development Agreement, as hereinafter defined. Payments shall be applied first to accrued interest and second to unpaid principal. Payments on this MRO shall be made only to the extent that the City has received Available Tax Increment, and then only to the extent of Developer's Share thereof. This MRO has been issued to finance projects within the City's Tax Incremental District No. 37 ("District") and is payable only from the income and revenues herein described, which income and revenues have been set aside as a special fund for that purpose and identified as the "Special Redemption Fund" provided for under the Resolution adopted on 2019 by the Common Council of the City (the "Resolution"). This MRO is issued pursuant to the Resolution and pursuant to the terms and conditions of the Tax Incremental District No. 37 Development Agreement dated as of _ 2019 between the City and the Developer ("Development Agreement"). This MRO does not constitute an indebtedness of the City within the meaning of any constitutional or statutory limitation or provision. This MRO shall be payable solely from Developer's Share of the Available Tax Increment generated by the Project located within the District and appropriated by the Common Council to the payment of this MRO (the "Revenues"). Reference is hereby made to the Resolution and the Development Agreement for a more complete statement of the revenues from which and conditions and limitations under which this MRO is payable and the general covenants and provisions pursuant to which this MRO has been issued. The Resolution and Development Agreement are incorporated herein by this reference. Capitalized terms used in this MRO which are not defined in this MRO shall have the meaning attributable to such terms as set forth in the Development Agreement. 20960394.5 The City shall have no obligation to pay any amount of this MRO which remains unpaid after the Final Payment Date of November 1, 2047. The City makes no representation or covenant, express or implied, that the Available Tax Increment or other Revenues will be sufficient to pay, in whole or in part, the amounts which are or may become due and payable hereunder. The City's payment obligations hereunder are subject to appropriation, by the Common Council, of Available Tax Increment to make payments due on this MRO. When the amount of Revenues have been appropriated and applied to the payment of all principal and interest due under this MRO, the MRO shall be deemed to be paid in full and discharged, and the City shall have no further obligation with respect hereto. Further, as provided in Section VIII.B.1 of the Development Agreement, the City shall have no obligation to make payments on this MRO in the event of certain defaults described in Section VIII.A of the Development Agreement. This MRO is a special, limited revenue obligation and not a general obligation of the City and is payable by the City only from the sources and subject to the qualifications stated, incorporated or referenced herein. This MRO is not a general obligation of the City, and neither the full faith and credit nor the taxing powers of the City are pledged to the payment of the principal of this MRO. Further, no property or other asset of the City, except the above -referenced Revenues, is or shall be a source of payment of the City's obligations hereunder. Subject to the foregoing, the City may, at its option, prepay this MRO at any time. This MRO is issued by the City pursuant to, and in full conformity with, the Constitution and laws of the State of Wisconsin. This MRO may be transferred or assigned, in whole or in part, with the consent of the City, which consent shall not be unreasonably withheld. Interests in this MRO may not be split, divided or apportioned. In order to transfer or assign the MRO, the transferee or assignee shall surrender the same to the City either in exchange for a new, fully -registered municipal revenue obligation or for transfer of this MRO on the registration records for the MRO maintained by the City. Each permitted transferee or assignee shall take this MRO subject to the foregoing conditions and subject to all provisions stated or referenced herein. It is hereby certified and recited that all conditions, things and acts required by law to exist or to be done prior to and in connection with the issuance of this MRO have been done, have existed and have been performed in due form and time. 20960394.5 IN WITNESS WHEREOF, the City Council of the City of Oshkosh has caused this MRO to be signed on behalf of the City by its duly qualified and acting City Manager and City Clerk, and its corporate seal to be impressed hereon, all as of the date of original issue specified above. CITY OF OSHKOSH By: _ Name: Title: Attest: Name: Title: 20960394.5 Schedule 1 Payment Schedule Subject to the City's annual receipt of Available Tax Increment and the terms and conditions of the Development Agreement, the City will pay to Developer Developer's Share of Available Tax Increment received by the City for the prior year on each November 1 during the Payment Term; provided, that in no event shall payments to Developer under this MRO exceed $222,321.00, exclusive of interest. 20960394.5 REGISTRATION PROVISIONS This MRO shall be registered in registration records kept by the City Clerk of the City of Oshkosh, Winnebago County, Wisconsin, such registration to be noted in the registration blank below and upon said registration records, and this MRO may thereafter be transferred only upon presentation of this MRO together with a written instrument of transfer approved by the City and duly executed by the Registered Owner or his attorney, such transfer to be made on such records and endorsed hereon. Date of Registration Name of Registered Owner Suture of City Clerk 20960394.5 Exhibit E