HomeMy WebLinkAboutMill on Main Redevelopment Project Phase 1DEVELOPMENT AGREEMENT
Document Number
Title
,elopment Agreement between the City of Oshkosh, Wisconsin, a
consin municipal corporation (the "City"), and THE MILL ON MAIN
1, LLC. a Wisconsin Limited liability company (the "Developer)."
arcel No. 03-01390-300
DOC# 1911294
REGISTER OF DEEDS
WINNEBAGO CO
RECORDED
10/03/2023 08:22 AM
RECORDING0�
PAGES: 38
Recording Area
Name and Return Address
Community Development
PO Box 1130
Oshkosh, WI 54903-1130
03-01390-300
Parcel Identification Number (PIN)
)t 1 of Certified Survey Map No. 8005, recorded with the Winnebago County Register of Deeds as Document
o. 1899509, being a art of1he Southwest'/4 of Section 24, all in Township 8 North, Range 16 East, City of
shkosh, Winnebago County, Wisconsin.
is instrument drafted by:
Kelly Nieforth
Oshkosh, WI 54903-1130
TAX INCREMENTAL DISTRICT NO.43
DEVELOPMENT AGREEMENT
(MILL ON MAIN REDEVELOPMENT PROJECT PRASE 1)
This Development Agreement ("Agreement") is made this _L� day of l (t, 2023
(the "Effective Date"), by and among the CITY OF OSHKOSH, WISCONSIN, a Wisconsin
municipal corporation, the REDEVELOPMENT AUTHORITY OF THE CITY OF OSHKOSH,
WISCONSIN (the "RDA" and, collectively with the City of Oshkosh, Wisconsin, the "C"), and
THE MILL ON MAIN PH 1, LLC, a Wisconsin limited liability company ("Developer').
WHEREAS, the City has established Tax Incremental District No. 43 (the "District") as a
13.45 acre blighted area district in which at least fifty percent (50%) of the property within the
District is a blighted. area, as that term is defined by Wis. Stat. Sec. 66.1105(2)(ae), and in which
certain costs incurred for redevelopment of the District may be reimbursed from the property tax
increment as provided by State law; and
WHEREAS, T. WALL ENTERPRISES DEVELOPMENT, LLC ("T. Wall'), approached
the City indicating a desire to develop and construct within the District, in three (3) phases, a
mixed -use project consisting of approximately 296 residential units and approximately 19,375
square feet of commercial space, together with underground and surface parking, other
infrastructure and site improvements, in accordance with applicable City ordinances and City -
approved plans (the "Project'), all as shown on the conceptual site plan attached hereto as Exhibit
A (the "Site Plan"); and
WHEREAS, to promote the development of the Project, 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 the Project; and
WHEREAS, Phase 1 of the Project will consist of approximately 110 market rate apartment
units and approximately 11,575 square feet of commercial space (the "Phase 1 Project'), to be
constructed by Developer as shown on the Site Plan, on a parcel of real property to be conveyed
by the RDA to Developer (the "Phase 1 Prope):ty"), which -Phase 1 Property is legally described
on Exhibit B attached hereto; and
WHEREAS, Developer. would not undertake the development of the Phase 1 Project but
for their reliance upon receiving tax- increment financing to assist in the funding of a portion of
Developer's acquisition, development and operation costs for the Phase 1 Property, all as described
below; 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 Phase 1 Property 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 opportunities, and providing a financing
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mechanism to make certain public improvements, 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 foregoing 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.
b3. Affiliate. "Affiliate" means any entity which is, directly or indirectly,
majority owned and controlled by, in control of, or under common control with T. Wall or
Developer as of the Effective Date.
CAvailable 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 Phase 1 Property and improvements located
thereon in the immediately preceding calendar year.
D. Case Closure. "Case Closure" has the meaning set forth in Wis. Stat. Sec.
292.12.
Er City Contribution. "City Contribution" means payments to be provided
from the City to the Developer with respect to the Phase 1 Project from Available Tax Increment
pursuant to the terms of this Agreement, in a total principal amount not to exceed the lesser of (i)
Eight Million Three Hundred Forty Three Thousand Three Hundred Sixty Four and No/100
Dollars ($8,343,364.00), or (ii) twenty five percent (25%) of Phase 1 Project Costs, subject to
adjustment as provided in Section IV.B. and Section IX.B.1., below.
F. District. "District" means all of the property included in Tax Incremental
Finance District No. 43 as described in the Project Plan.
G. Existing Environmental Conditions. "Existing Environmental Conditions"
means any Hazardous Substances, known or unknown, present in concentrations greater than
applicable standards on, in, at, or under the Phase 1 Property or migrating in concentrations greater
than applicable standards to or from the Phase 1 Property at any time on or before the
commencement date of the Ground Lease, including, but not limited to those matters subject to
the following proceedings: (i) Sawdust District — LGU, BRRTS #03715857901, 43 E. 7t' Avenue;
(ii) 706 S. Main Street — City of Oshkosh— LGU, BRRTS #0371586044, 706 S. Main Street; (iii)
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Recreational Lanes, BRRTS: #0371524916 (closed), 710 S. Main Street; and (iv) Miles Kimball
Co., BRRTS #0271000135 (closed with conditions), 41 W. 8th Street.
H. Ground Lease. "Ground Lease" means that certain Ground Lease by and
between the RDA and Developer, in the form attached hereto as Exhibit F, pursuant to which
Developer will lease the Phase I Parcel from the RDA until the conditions set forth in Article V.
below, are met.
I. Hazardous Substances. "Hazardous Substances" means toxic, hazardous,
and/or regulated substances, pollutants, or contaminants, whether present in the soil or
groundwater at, under, or migrating from or to the Phase 1 Property.
T. Payment Dates. "Payment Dates" means November 1 of each year,
commencing on the third November 1 after the Effective Date of this Agreement, up to and
including November 1, 2050.
IS.. Payment Term. "Payment Term" means the term commencing on the first
day of the third November after the Effective Date and continuing on each Payment Date 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, 2050.
.L. Phase 1 MRO. "Phase 1 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 as described in Section IV.A. below, in substantially the form of Exhibit D attached
hereto and incorporated herein. The Phase 1 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 Phase 1 MRO.
M, Phase 1 Project Costs. "Phase 1 Project Costs" means the total of all hard
and soft costs of acquiring and constructing the Phase 1 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 development of the Project. Developer's initial estimate
of Phase 1 Project Costs is attached hereto as Exhibit C. For the avoidance of doubt, "Phase 1
Project Costs" shall not include any amounts expended by Developer or any Affiliate during the
construction of the Phase 1 Project which are incurred with respect to future phases of the Project
(such future phases generally referred to herein as "Phase 2" and "Phase 3"), each of which is
subject to a separate Development Agreement.
N. Project Plan. "Project Plan" means the "Project Plan for the Creation of
Tax Incremental Finance District No. 43 (Mill on Main Redevelopment Project) in the City of
Oshkosh" prepared by Ehlers, Inc. dated August 2, 2022.
0. Tax Increment. "Tax Increment" has the same meaning as defined in
Section 66.1105(2)(i) of the Wisconsin Statutes.
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P. Tax Increment Law. "Tax Increment Law" means Section 66.1105 of the
Wisconsin Statutes.
II. GROUND LEASE; ACQUISITION OF PROPERTY. The City and T. Wall
are parties to a Purchase Agreement dated as of January 27, 2022, as amended, pursuant to which
T. Wall and/or one or more affiliates of T. Wall will acquire the Project property, including the
Phase I Property. The terms of this Agreement and the related development agreements being
entered into contemporaneously regarding Phases 2 and 3 of the Project are intended to incorporate
the final terms of agreement between the parties hereto with respect to the Project and the Purchase
Agreement is hereby terminated.
On or promptly following the Effective Date, the RDA and Developer will enter
into the Ground Lease with respect to the Phase 1 Property, which will contain terms reasonably
satisfactory to the RDA (as ground lessor) and Developer (as ground lessee), but in all events shall
contain the following terms and conditions:
1. A term of fifty (50) years, commencing upon the date that the
Ground Lease is signed (subject to subsection 5, below), but terminable upon the conveyance of
the Property by the RDA to the Developer pursuant to Article V. below.
2. Base rent of $1 per year.
3. Developer will be responsible for all general property taxes on the
Property (or, if such land is exempt from general property taxes, additional rent in an amount equal
to what such taxes would be if the Property were not exempt), which accrue during the term of the
Ground Lease.
4. The City will retain a right of access to the Property, upon providing
written notice to the Developer (which may be by electronic mail), to the extent necessary to
perform the City's obligations with respect to any required environmental remediation of the
Property pursuant to Article V, below.
5. The Ground Lease may be terminated by Developer in the event that
Developer is not able to secure a building permit from the City for the Phase 1 Project and has not
otherwise commenced construction activities on the Phase 1 Property.
6. The Ground Lease shall terminate in the event that the Phase I
Project is abandoned by Developer.
7. Developer may purchase the Property at any time following
completion of the Phase I Project for $1.00 and shall be required to purchase the Phase I Property
upon receipt of a COC (as that term is defined in Article V, below).
III. OBLIGATIONS OF DEVELOPER.
A. Phase 1 Project Construction. Developer shall commence construction of
the Phase 1 Project no later than September 30, 2023. Developer shall diligently pursue
completion of construction of the Phase 1 Project in accordance with applicable City ordinances
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and City -approved plans so that, subject to the terms and conditions set forth in this Agreement,
construction of the Phase 1 Project shall be substantially complete by December 31, 2024 (the
"Phase 1 Completion Date"). With respect to the development of the Phase 1 Project under this
Section III.A., Developer agrees that it shall expend Project Costs in an amount of not less than
$30,000,000.00 ("Minimum Phase 1 Project Costs"). For purposes hereof, "commencement of
construction" shall mean the start of site improvements such as site grading or clearing and fencing
and "substantially complete" shall mean the issuance of a certificate of occupancy.
II, Costs and Expenses. The Developer shall be responsible for all costs related
to the Phase 1 Project and any other work to be performed by the Developer under this Agreement,
including all engineering, inspections, materials, labor, on -site management of Hazardous
Substances (subject to Article V below), as well as all costs of monitoring and otherwise complying
with any institutional controls and continuing obligations relating to the Existing Environmental
conditions and/or imposed by any Case Closure. Developer shall also be responsible for payment
of all City fees including building permit fees, zoning and sign permit fees, electrical and plumbing
fees. Developer shall also be responsible for special assessments for certain public work done in
connection with the Project as provided in Section IV.E. below; specifically (i) the reconstruction
of South Main Street and East 7th Avenue as provided by the City's Special Assessment Policy for
property owners for similar projects, (ii) the installation of all laterals necessary for water, sewer
and storm sewer services for the Project, (iii) the added cost for a parking lane along South Main
Street, and (iv) the incremental cost to construct the north side of East 9th Avenue in a manner
which will permit angle parking adjacent to the Project. Any special assessments payable by the
Developer may be paid in installments to the extent permitted by the City's Special Assessment
Policy.
CSubmission and Verification of Phase 1 Project Cost Information. The
Developer shall submit evidence of all Phase 1 Project Costs which it intends to serve as the basis
for the City Contribution to the City promptly following the completion of the Phase 1 Project.
Developer's submission shall.be in same form as Developer's initial budget estimate (attached
hereto as Exhibit C), shall set forth actual costs incurred for each line item, and shall include the
general contractor's final affidavit of payment of all debts and claims (AIA Form G706 or
equivalent) and evidence of payment of all invoices, together with copies of lien waivers from
each contractor or other payee having lien rights. All Phase 1 Project Costs shall be certified as
true, correct and complete by Developer and subject to reasonable verification by the City. The
City shall keep the documents submitted to the City described in this Section III.C. confidential to
the extent possible pursuant to open records laws.
IV. CITY CONTRIBUTION AND OBLIGATIONS.
A, City Contribution. In each year beginning in the year following the first
year in which the Phase 1 Project generates Tax Increment and ending in 2050 (or, if earlier, when
the total amount of the City Contribution has been reimbursed to Developer under this Agreement),
in consideration of the Developer undertaking its obligations under this Agreement, the Available
Tax Increment shall be applied to make payments under this Agreement to pay the Developer the
City Contribution. The City Contribution constitutes eligible "Project 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 third November after the date of this Agreement provided that there is Available
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Tax Increment. Such payments shall be made in accordance with the terms of this Agreement, as
further described in this Section IV.A. and the Phase 1 MRO. The City Contribution shall be paid
by the City only out of Available Tax Increment, subject to the provisions of this Agreement and
the Phase 1 MRO. The City Contribution is a special and limited obligation of the City, and not a
general obligation of the City.
The Phase 1 MRO shall be issued upon the issuance by the City of a
certificate of occupancy for the Phase 1 Project, in the amount set forth in Section LE., above.
The City Contribution shall not bear interest.
Developer acknowledges that, subject to the provisions of this Agreement:
(i) all payments of Available Tax Increment are subject to future annual appropriation of said
amounts by the City Common Council to payment hereunder; (ii) only the Available Tax
Increment generated by the Phase 1 Property (and all improvements and personal property thereon)
shall be used to make payments to the Developer; and (iii) if, on November 1, 2050, the amount
of 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. With respect to clause
(i), above, the City covenants and agrees as follows: (a) the City Manager or their designed
representative shall include the payment of the entire Available Tax Increment for each year
included during the Payment Term 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 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) Available Tax Increment shall not be used to pay any other project costs of the District in
any year until the City has made the payment due hereunder to Developer for such year in full.
Developer further acknowledges that, as a result of the special and limited nature of the City's
obligation to pay the City Contribution, the Developer's receipt of the City Contribution also
depends on factors including future mill rates, changes in the assessed value of the Phase 1
Property, failure of the Phase 1 Project to generate Tax Increment at the rate expected by the
Developer, changes in the Tax Increment Law, and other failures beyond the City's or Developer's
control.
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
amount of Available Tax Increment appropriated by the City Common Council for the payment
due that Payment Term year.
2. The City shall take no action to terminate or dissolve the District
prior to November 1, 2050, unless the City first pays the outstanding balance due under the City
Contribution to Developer, subject to the provisions of this Agreement.
Attached hereto as Exhibit E is the City's projection of revenues and
expenditures for the District over its term, with the City Contribution labeled as "Phase 1
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Development Incentive" thereon. Exhibit E is provided for illustrative purposes only, and
Developer acknowledges that the amounts set forth thereon are estimates only.
R Adjustment to City Contribution for Failure to Construct Phases 2 and/or 3
of the Project. In the event that one (1) additional phase of the Project (which may be either Phase
2 or Phase 3 as presently contemplated) is not substantially completed by the fifth (5a') anniversary
of the Effective Date, the amount of the City Contribution shall be reduced by $400,000.00. In
the event that one (1) additional phase of the Project is substantially completed by the fifth (51h)
anniversary of the Effective Date, but the remaining phase is not substantially completed by the
tenth (101h) anniversary of the Effective Date, the amount of the City Contribution shall be reduced
by $200,000.00. The adjustment may be structured by any of the following means, at Developer's
option, so long as the City is not required to subordinate its right to payment to any other party:
1. Forgivable Note. A forgivable promissory note payable to the City
by Developer in the amount of $400,000.00, of which $200,000.00 will be forgiven upon the timely
substantial completion of each additional phase of the Project. If Developer or its Affiliate(s)
substantially complete one (1) additional phase of the Project within five (5) years of the Effective
Date, the City shall forgive $200,000.00 of the note. If Developer or its Affiliate(s) substantially
complete the second phase of the Project within five (5) years of the Effective Date and the third
phase of the Project within ten (10) years of the Effective Date, then the entire $400,000.00 note
will be forgiven. If one or both additional phases of the Project are not substantially completed
within the timeframes set forth above, the amounts not forgiven will be deducted from the next
payment(s) of the City Contribution to be made to Developer. The following examples assume an
Effective Date of April 1, 2023:
• Developer substantially completes Phase 2 of the Project in 2027
and Phase 3 of the Project in 2031. $200,000.00 is forgiven in 2027, and
the remaining $200,000.00 is forgiven in 2031.
• Developer substantially completes Phase 2 of the Project in 2027
but does not substantially complete Phase 3 of the Project by April 1, 2033.
$200,000.00 is forgiven in 2027, but the remaining $200,000.00 would
become due and payable to the City and would be deducted from
payment(s) of the City Contribution beginning in November, 2033 and
continuing until the $200,000.00 is paid in full.
• Developer does not substantially complete a second phase of the
Project by April 1, 2027. The entire $400,000.00 would become due and
payable to the City and would be deducted from payment(s) of the City
Contribution beginning in November, 2027 and continuing until the
$400,000.00 is paid in full.
2. Preferred Equity. An option to acquire a $400,000.00 preferred
equity interest in the Developer, exercisable in the event that subsequent phases of the Project are
not substantially completed by the timeframes set forth in Section IV.B.1., above, which preferred
equity interest, if acquired, may immediately be put to Developer. If the Developer or its
Affiliate(s) substantially complete one (1) additional phase of the Project within five (5) years of
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the Effective Date, the City's option to acquire $200,000.00 of the preferred equity interest
terminates. If Developer or its Affiliate(s) substantially complete both additional phases of the
Project within ten (10) years of the Effective Date, the City's option to acquire the preferred equity
interest terminates entirely. The following examples again assume an Effective Date of April 1,
2023:
• Developer substantially completes Phase 2 of the Project in 2027
and Phase 3 of the Project in 2031. The City's right to acquire a preferred
equity interest in Developer is reduced to $200,000.00 in 2027 and
terminates entirely in 2031.
• Developer substantially completes Phase 2 of the Project in 2027
but does not substantially complete Phase 3 of the Project by April 1, 2033.
The City's right to acquire a preferred equity interest in Developer is
reduced to $200,000.00, but the City may exercise its right to the remaining
$200,000.00 preferred equity interest, which the Developer would then
repurchase by having the City deduct the purchase price from the
payment(s) of the City Contribution beginning in November, 2033 and
continuing until the $200,000.00 purchase price is paid in full.
• Developer does not substantially complete a second phase of the
Project by April 1, 2027. The City may exercise its right to the entire
$400,000.00 preferred equity interest, which the Developer would then
repurchase by having the City deduct the purchase price from payment(s)
of the City Contribution beginning in November, 2027 and continuing until
the $400,000.00 is paid in full.
3. Cash. Any amounts due and payable from Developer under this
Section IV.B. may be paid in cash in lieu of reduction(s) in payments of the City Contribution.
4. The City agrees to reasonably cooperate with Developer regarding
future extensions requested by the Developer to the overall Project schedule due to factors outside
of the Developer's control, including, but not limited to, acts of God, government shutdowns,
pandemics, and economic recession.
5. Notwithstanding anything in this Section IV.B. to the contrary, any
amounts that would be due under this Section IV.B. for failure to complete a phase of the Project
shall become immediately due and payable at such time as the Developer and/or its Affiliate(s)
provide notice to the City that they do not intend to complete either Phase 2 or Phase 3.
C. City Contribution not to be Considered Indebtedness. In no circumstances
shall the 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 the Available Tax Increment
which is 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 Tax Increment which has been appropriated for that purpose.
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D. City Cooperation; Approvals. City shall timely complete all necessary or
required zoning, development and use reviews for the Phase 1 Project, pursuant to applicable City
ordinances. City shall process, on a timely basis, each and every application submitted by, through
or under Developer in connection with its development of the Phase 1 Project, including all
applications with respect to necessary or appropriate licenses and permits in connection with
Developer's development of the Phase 1 Project. Without limitation, if an application is deemed
deficient, City shall cooperate with Developer to ensure proper completion thereof. Likewise, City
shall use good faith efforts to diligently process all such matters, to assist Developer's efforts to
timely complete the Phase 1 Project as set forth in this Agreement.
E' City Construction Work. The City will (i) remove overhead power lines
and poles located within the District on East 7th Avenue, East 8th Avenue, between East 8th Avenue
and East 9th Avenue, and along the railroad corridor and install underground electric lines; (ii)
construct (subject to Wisconsin Department of Natural Resources ("WDNR') approval)
approximately twenty (20) public docks and perform ancillary shoreline work along the riverfront;
(iii) construct a parking lot at the trail head of the City's Riverwalk; (iv) reconstruct 9th Street along
the southern boundary of the Project; (v) reconstruct South Main Street along the western boundary
of the Project and (vi) reconstruct East 7th Avenue east of South Main Street with a cul-de-sac,
sidewalk and aprons to access parking areas within the Project area. The City will complete the
installation of underground electric lines no later than the Phase 1 Completion Date and intends to
complete the balance of the work described in this Section N.E. within the timeframes established
in the Project Plan.
V. ENVIRONMENTAL MATTERS; TRANSFER OF PHASE 1 PROPERTY.
A. The City will enroll the property located within the District in the State of
Wisconsin Voluntary Party Liability Exemption ("VPLE") program (Wis. Stat. §292.15) and will
obtain a Certificate of Completion ("COC") from the WDNR for the property located within the
District, including the Phase 1 Property. The expense associated with the application to enroll the
Phase 1 Property in the VPLE program will be the responsibility of the City. The expense of any
necessary monitoring, remediation or other work during construction of the Phase 1 Project
necessary for the issuance of, or which may be required thereafter by the terms of, the COC
(including, but not limited to, the preparation and submission of a Material Management Plan to
WDNR) will be the responsibility of Developer. The parties acknowledge that the COC will
pertain only to those substances which the City or the Developer have investigated and remediated
to the satisfaction of WDNR and will not extend to a release of Hazardous Substances not included
within any such investigation, including, by way of example, any release of per- or polyfluoroalkyl
substances ("PFAS"), to the extent PFAS is not a subject of investigation in the VPLE proceeding.
The City's environmental consultant, AECOM, has developed a memorandum to support its
determination, based upon desktop evaluations of the use and history of the property located within
the District, that it is unlikely that PFAS was used or discharged on the property located withing
the District. AECOM is seeking a Technical Assistance Clarification from WDNR regarding its
PFAS evaluation.
B. Developer acknowledges and agrees that (i) the City will not apply for the
COC prior to substantial completion of the Phase 1 Project (and, potentially, not until the
completion of those phases of the Project in its entirety), (ii) the COC may impose institutional
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controls, including, but not limited to, groundwater use restrictions and cap construction and
maintenance requirements, and (iii) the Phase 1 Property is presently subject to institutional
controls and continuing obligations imposed by the WDNR relating to the Existing Environmental
Conditions. Based upon the foregoing, Developer (x) acknowledges the residual presence of
certain Existing Environmental Conditions, and (y) agrees that certain continuing obligations
imposed by the WDNR related to such Existing Environmental Conditions may restrict
disturbance of the subsurface of the property following the issuance of the COC. Following the
commencement date of the Ground Lease, Developer shall be responsible for compliance with all
applicable institutional controls and continuing obligations and any additional institutional
controls and continuing obligations which maybe imposed by the COC or any future Case Closure.
C. Within sixty (60) days of WDNR's issuance of a COC covering the Phase
1 Property, the parties will terminate the Ground Lease, and the RDA will convey the Phase 1
Property to Developer for a purchase price of $1.00 by general warranty deed, subject to no liens
or encumbrances other than utility easements of record, zoning restrictions, deed restrictions
imposed by WDNR with respect to the COC or any Case Closure affecting the Phase 1 Property,
and other matters reasonably acceptable to Developer (each, a "Permitted Encumbrance"),
provided that no such Permitted Encumbrance will prohibit or interfere in any material respect
with the development or operation of the Phase 1 Project or the Project as a whole. The City shall
be responsible for payment of any and all property and other taxes levied against the Phase 1
Property for any period(s) prior to the Effective Date. The City shall pay the premium for an
owners' title insurance policy in the amount of $450,000, insuring that fee simple title to the Phase
1 Property is vested in Developer, subject to no liens or encumbrances other than Permitted
Encumbrances.
D, Developer shall be responsible for, and shall indemnify, defend, and hold
harmless the City and its officers, employees, contractors, and agents from and against, any and
all actions, claims, causes of action, costs, damages, demands by governmental entities or
individuals, expenses, liabilities, losses, obligations, penalties, or suits including, without
limitation, all reasonable attorney, consultant, and engineer costs or fees related thereto
(collectively, `Environmental Claims"), in any way arising out of, connected with, or resulting
from any Hazardous Substances, known or unknown, present on, in, at or under the Phase 1
Property or migrating to or from the Phase 1 Property from or after the commencement date of the
Ground Lease; provided, however, that Developer's obligations under this Section V.D. shall not
include any Environmental Claim relating to or arising from the presence at the Phase 1 Property
of a Hazardous Substance that is:
1. Confined to locations and at concentrations that are permissible to
remain in place without further action under applicable environmental laws or approved by WDNR
to remain in place in any Case Closure or the COC, provided Developer does not exacerbate such
Hazardous Substance or take or fail to take action triggering the need to respond to such Hazardous
Substance;
2. Present as a result of the introduction of such Hazardous Substance
by the City, whether directly or by migration from an off -site location;
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3. Present as a result of any failure by the City to perform any
obligation applicable to it under the terms of any Case Closure or the COC; or
4. Subject to or the subject of any exception from or release of liability
provided by the COC.
VI. APPROVALS AND DEVELOPMENT STANDARDS.
AApproval 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 Phase 1 Property) all
approvals and consents necessary for the City to approve the development of the Phase 1 Property,
and any other approvals necessary to utilize the Phase 1 Property for the Phase 1 Project.
Notwithstanding the foregoing, the City shall be responsible for the application to enroll the Phase
1 Property in the VPLE program as set forth in Section V.A., above.
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 Phase 1 Property and to act reasonably and
expeditiously and in cooperation with the Developer in connection therewith; it being understood
and agreed that this provision is not intended to limit the rights of the City as more particularly set
forth above or in Article IX, below.
C. Development Requirements. The Developer shall use the Phase 1 Property
for the Phase 1 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, neither the Developer nor any
existing or future Affiliate or related entity of the Developer (collectively, "Developer Affiliates")
shall use or permit the use of any of the Phase 1 Property in any manner which would render any
of such Property exempt from property taxation, without the prior written consent of the City,
which consent may be conditioned upon the obligation of the Developer, existing or future
Affiliate, any related entity of the Developer or any successor owner to enter into an agreement to
make a payment in lieu of taxes ("PILOT"), but may not be unreasonably withheld, so long as the
PILOT agreement requires a payment to the City substantially equivalent to the real estate tax
payment which would be payable with respect to the portion of the Phase 1 Property which is
exempt from taxation were such portion of the Phase 1 Property not tax-exempt. This provision
shall continue to be applicable until the termination of the District. Any amount received by the
City as a payment in lieu of taxes will be treated as additional Available Tax Increment, and subject
to payment to Developer under the Phase 1 MRO as provided herein.
11
28166700.15
VII. WARRANTIES AND REPRESENTATIONS.
A. The Developer hereby warrants, represents, and covenants to the City:
Developer is a duly organized and existing limited liability company
in the State of Wisconsin.
2. The execution, delivery, and performance of this Agreement and the
consummation of the transactions contemplated hereby have been duly authorized and approved
by Developer, and no other or further acts or proceedings of Developer or its member(s) or
manager(s) 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 agreements
and obligations 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.
3. There are no lawsuits filed or, to the knowledge of the Developer,
pending or threatened against the Developer or the Project that may in any material way jeopardize
the ability of Developer to perform its obligations hereunder.
4. Prior to the Effective Date, Developer shall demonstrate that it has
sufficient funds through equity and debt financing sources to construct, operate, maintain, and
fulfill the Phase 1 Project.
5. 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, (ii) a certificate of authority to transact business in the State of
Wisconsin, if Developer is organized in a state other than Wisconsin, and (iii) a certificate of
incumbency and resolutions of the Developer stating who is authorized to sign on behalf of
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.
6. Developer's current manager or another Affiliate of T. Wall shall
remain as the manager of the Developer through the Phase I Completion Date, and thereafter, the
replacement of Developer's manager with a party which is not an Affiliate of T. Wall shall be
treated as an assignment under Section X.D., below.
.6. 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
12
28166700.15
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 terms, 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. Except for any assessments which may have been levied for work
described in Section III.B., above, no special assessments or other charges of any kind have been
levied against the Phase 1 Property with respect to the Project Costs as of the Effective Date.
VIII. CONDITIONS TO/LIMITATIONS ON THE OBLIGATIONS.
Notwithstanding anything to the contrary set forth in this Agreement, neither the
City nor the Developer shall be obligated to expend any amounts under this Agreement and either
the City or the Developer may suspend or terminate this Agreement or the performance of any and
all of its obligations under this Agreement, without recourse by or against the other, 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
D. 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.
IX. DEVELOPER: EVENT OF DEFAULT.
A, Event of Default. An "Event of Default" is any of the following:
1. Failure to Construct the Phase 1 Project. Subject to the terms of this
Agreement, the Developer fails to construct the Phase 1 Project as required under Article III,
above; or
2. Taxes. 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 Phase 1 Property
is not paid prior to becoming delinquent; provided that the Developer shall have the right to contest
the same in accordance with applicable law; or
3. Tax Exemption. All or any portion of the Phase 1 Property becomes
tax exempt without a PILOT agreement; or
4. Breach of Agreement. The Developer breaches any provision of this
Agreement or its obligations under this Agreement; provided, 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, if a longer period is reasonably required under the circumstances, so long as the Developer has
begun to cure such breach in good faith within such sixty (60) day period and thereafter diligently
continues to cure such breach; or
13
28166700.15
5. Insolvency. Developer shall: (i) become insolvent or generally not
pay, or be unable to pay, or admit in writing its inability to pay, its debts as they mature; (ii) make
a general assignment for the benefit of creditors or to an agent authorized to liquidate any
substantial amount of its assets; or (iii) become the subject of an order for relief within the meaning
of the United States Bankruptcy Code, or file a petition in bankruptcy, for reorganization or to
effect a plan or other arrangement with creditors; or (iv) have a petition or application filed against
it in bankruptcy or any similar proceeding, and such petition, application, or proceeding shall
remain undismissed for a period of ninety (90) days or more, or the Developer shall file an answer
to such petition or application, admitting the material allegations thereof, or (v) apply to a court
for the appointment of a receiver or custodian for any of its assets or properties, with our without
consent, and such receiver shall not be discharged within ninety (90) days after its appointment;
or (vi) adopt a plan for the complete liquidation of its assets.
R CityOptions upon Event of Default. Whenever an Event of Default occurs
under Section IX.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; provided,
that (i) if the Event of Default is solely a failure by Developer to spend the Minimum Phase 1
Project Costs, the City will not terminate all of its payment obligations hereunder, but will reduce
the City Contribution on a pro rata basis based upon the ratio of actual Phase 1 Project Costs to
Minimum Phase 1 Project Costs; and (ii) if the Event of Default is solely a failure by Developer
to complete the Phase 1 Project in time for it to be fully assessed as of January 1, 2025, the City
will not terminate all of its payment obligations hereunder, but will permanently reduce the City
Contribution by an amount equal to difference between Available Tax Increment actually paid to
Developer on the November 1, 2026 Payment Date and the amount of Available Tax Increment
which would have been paid to Developer on such date had the Phase 1 Project been completed in
a timely manner.
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.
C. Delay in Exercise of Rights Not Waiver. No delay or omission to exercise
any right or power accruing to the City, on the one hand, or the Developer, on the other hand, 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
14
28166700.15
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.
H., 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.
X. MISCELLANEOUS PROVISIONS.
.A. Incorporation 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 IX, above, the term of this
Agreement shall begin as of the Effective Date and shall continue until December 31, 2050, unless
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 City will 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.
1. General Restriction. Except as set forth in Sections X.D.2. and
X.D.3., below, Developer may not assign or transfer its rights and obligations under this
Agreement without the prior written consent of the City (which such consent, following substantial
completion of the Project, shall not be unreasonably withheld, conditioned or delayed). For
purposes hereof, the removal of an Affiliate of Developer as the manager of Developer shall be an
assignment subject to this Section X.D.1. Upon an assignment or transfer of the Developer's rights
and obligations under this Agreement in violation of this Section X.D.I., this Agreement shall
terminate at the option of the City and be of no further force and effect.
2. Permitted Assignments. Following substantial completion of the
Phase 1 Project, Developer may assign all of its rights and obligations to an Affiliate, without the
prior written consent of the City, so long as the proposed Affiliate assignee agrees in writing to
assume all of the Developer's rights and obligations under this Agreement, the Developer conveys
the Phase 1 Property to the Affiliate assignee, the Developer provides the City with timely written
notice and a copy of such fully executed assignment and assumption agreement, and T. Wall or an
Affiliate of T. Wall remains the manager of the Affiliate assignee.
3. Collateral Assignment of Development Agreement. Developer may
assign its rights and obligations under this Agreement to a lender or lenders, solely for purposes
of providing collateral security for a loan issued to Developer for the purposes of the construction
15
28166700.15
and development of the Phase 1 Project. Any such assignment shall be contingent upon, or become
effective only following, an event of default Developer under the terms of the loan. So long as
Developer has notified the City of the identity and contact information for its lender, the City will
use reasonable efforts to notify Developer's lender of any Event of Default by Developer
hereunder. Any such assignment shall be of the right to receive payments on the City Contribution
only, and no such assignment shall relieve Developer of any of its obligations to the City
hereunder.
H. 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") including, without limitation in any way, acts of God, war, fire, or other
casualty, riot, civil unrest, extreme weather conditions, terrorism, strikes, and/or 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. 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.
G, Headings. Descriptive headings are for convenience only and shall not
control or affect the meaning or construction of any provision of this Agreement.
I1, Delivery of Notices. Except as otherwise provided herein, 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, or faxed to the parties' respective addresses as follows, provided any notice given
by facsimile 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, WI 54903-1130
Attn: City Attorney
With a copy to: Godfrey & Kahn, S.C.
100 W. Lawrence Street
Appleton, WI 54911
Attn: Michael J. Lokensgard
To Developer: Mill on Main Ph 1, LLC
1818 Parmenter Street, Suite 400
P.O. Box 620037
Middleton, WI 53562
Attn: Terrence R. Wall, President of its Manager
16
28166700.15
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 electronic mail (provided notice is promptly sent by
one of the other methods).
I. Entire Agreement. This Agreement and all other documents and
agreements expressly referred to herein, contain the entire agreement between the Developer and
the City with respect to the matters set forth herein. This Agreement may be modified only in
writing signed by all parties.
J. Law Applicable. This Agreement shall be construed in accordance with the
internal laws of the State of Wisconsin.
K. Originals and Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original.
L. 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-i_ Limitation on Liabilitv. 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 the either 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.
N. 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.
O. Recording of Agreement. The parties hereto agree that at the City's option
a memorandum of this Agreement may be recorded on the record title to the Phase 1 Property.
The Developer shall upon request of the City execute and deliver any such memorandum or other
document in connection with such recording.
P. 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 Phase 1 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.
Q. 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.
17
28166700.15
R. 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
deemed to have conferred any rights, expressed or implied, upon any other party, except as set
forth in Section X.D.
S. 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.
18
28166700.15
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the
date stated in the first paragraph of this Agreement.
MILL ON MAIN PH 1, LLC, a Wisconsin limited
liability company
By: T. WALL ENTERPRISES MANAGER, LLC, a
Wisconsin limited liability company, its Manager
By:
Nanl�.������
Title: President
STATE OF IAJ �sCO e^ V1 }
} SS.
COUNTY OF 4,0- - }
J
Personally' came .before me this day of. 2023, the
above -named Terrence R. Wall, to me known to be the person ho executed the foregoing
instrument on behalf of Mill on Main. -Ph 1, LLC.
FREDERICK TAYLOR BRENGEL
Notary Public
State of Wisconsin
Notary Public, State of W i$C.CMS. W
My Commission: Pp_r.'�
28166700.15
19
CITY OF OSHKOSH, WISCONSIN
By:
Mark A. Rohloff, City Manager
By:
Diane Bartlett, City Clerk
Approved as to form:
,LD
By:� 4.60JX.J�
y A. Lore o , City Attorney
STATE OF WISCONSIN }
} SS
COUNTY OF WINNEBAGO }
Personally came before me this _�,5 day of September, 2023, the above named Mark A.
Rohloff and Diane Bartlett, to me known to be the City Manager and City Clerk, respeotiH
the City of Oshkosh, Wisconsin, and the persons who executed the foregoing
y o 7
q �w -
vn
:cn;
Notary Pub ic, State of Wis onsii,,,, p� • . • - - _ , . ,,��'
My Commission: i�(��b(p''otiwi(�NS;•��'
28166700.15
REDEVELOPMENT AUTHORITY OF
THE CITY OF OSHKOSH, WISCONSIN
By: M �r�
a l f1 u .¢ , Chair
loof
By:
L ecutive Director
STATE OF WISCONSIN }
} SS
COUNTY OF WINNEBAGO }
Personally came before me this IVL day of TT►�gUST , 2023, the above named
mq �, r and 11V N i e ��, to me known to be the Chair and Executive
Director, respectively, of the Redevelopment Authority of the City of Oshkosh, Wisconsin, and
the persons who executed the foregoing instrument.
Notary Public, State of W onsin
.Z
My Commission: —a0 S
21
28166700.15
Exhibit A
Project Site Plan
EXHIBIT B
Legal Description of Phase I Parcel
Lot 1 of Certified Survey Map No. 8005, recorded with the Winnebago County Register of Deeds
as Document No. 1899509, being a part of the Southwest '/a of Section 24, all in Township 18
North, Range 16 East, City of Oshkosh, Winnebago County, Wisconsin.
28166700.15
EXHIBIT C
Estimate of Phase I Project Costs
Acquisition Costs
Land Cost
Construction Costs
Mixed -Use Building
TI — All Retail
On -site Work
Park & Public Space Improvements
Construction Contingency
Clubhouse and Pool
Environmental Abatement/Soil Correction
Soil Remediation
Underground Parking - Dewatering
On -site Work
Permits/Fees
Municipal Fees
Professional Services
Architectural & Engineering
FF&E
Legal — Miscellaneous Development
Marketing/Leasing
Owner's Representative
Soft Cost Contingency
Financing Costs
Construction Period Interest
Loan Origination Fees & Financing Costs
Due Diligence
Equity Raising Expense
Entitlement Contribution
$23,951,615
$752,375
$150,000
$300,000
$734,359
$2,350,000
$386,000
$600,000
$0
$138,799
$403,400
$150,000
$178,978
$35,000
$87,500
$267,849
$0
$168,883
$78,220
$758,034
Entitlement Contribution $1_,666,628
Cash Accounts/Escrows/Reserves
Debt Service Reserves $1,642,041
Management Startup/Leasing $19.9,503
Other Soft Costs $0
TOTAL
Error! Unknown document property name.
$34,999,184
EXHIBIT D
UNITED STATES OF AMERICA
STATE OF WISCONSIN
COUNTY OF WINNEBAGO
CITY OF OSHKOSH
MILL ON MAIN PHASE 1
TAXABLE TAX INCREMENT PROJECT MUNICIPAL REVENUE OBLIGATION
Number Date of Original Issuance Principal Amount
$ [8,343,364] 1
FOR VALUE RECEIVED, the City of Oshkosh, Winnebago County, Wisconsin (the
"City"), promises to pay to [THE MILL ON MAIN PH 1, 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 from time to time outstanding hereunder, on the dates
hereinafter provided, subject to the terms and conditions of this Municipal Revenue Obligation
("MRO").
This MRO is issued pursuant to the terms of a Tax Incremental District No. 43
Development Agreement dated as of , 2023 among the City, the Redevelopment
Authority of the City of Oshkosh, Wisconsin and the Developer ("Development Agreement").
Capitalized terms used herein without definitions have the meanings ascribed to them in the
Development Agreement.
This MRO shall be payable in installments on [November 1, 2025] and each November 1
thereafter (the "Payment Dates") during the Payment Term in an amount equal to the Available
Tax Increment for the prior year provided that such payments are due under the Development
Agreement. Payments on this MRO shall be made only to the extent that the City has received
Available Tax Increment.
This MRO has been issued to finance projects within the City's Tax Incremental District
No. 43 ("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 , 2023
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 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
I Or 25% of final Phase 1 Project Costs, if less, and subject to adjustment as provided in the Development Agreement.
28166700.15
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.
The City shall have no obligation to pay any amount of this MRO which remains unpaid
after the final Payment Date of [November 1, 20501.
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 Revenues
totaling the principal amount of this MRO have been appropriated and applied to payment of 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, the City's obligation to make payments on this
MRO in the event of (i) the failure to complete future phases of the Project, and/or (ii) certain
defaults under the Development Agreement shall be limited as provided in Section IV.B and
Section IX.B.1 of the Development Agreement, respectively.
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, 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.
28166700.15
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, WISCONSIN
By: ✓Y
Name: /j'l
Title: C i k!l 04'r„ a g r r
Attest:
Name:
Title:
28166700.15
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
representation 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 Signature of Ci . Clerk
28166700.15
Exhibit E
City
Oshkosh,
W1
Tax
nt District
#43, (Mill
on Main)
Cash
.Projection;
Development
Incentives
Phase I @
Phase II @
Phase III @
Public
90°,5
90%
90%
Infrastructure &
Total
Outstanding
Year
Tax Increments Total Revenues
of Increment
of Increment
eand
of Incrment
l Wdtedown
Admin.
Expenditures
Annual
Cumulative PAYGO Balances
Year
2022
0
0
0
0
0
25,000
25,000
(25,000)
(25,000)
0
2022
2023
0
0
0
0
0
5,000
5,000
s'000)
(301000)
8,343,364
2023
2024
110,362
110,362
99,326
0
0
5,100
104,426
5,936
(24,064)
14,162,534
2024
2025
427,793
427,793
297,977
87,037
0
13,514
5,202
403,730
24,064
0
13,777,520
2025
2026
731,570
731,570
397,303
261,110
0
67,851
5,306
731,570
0
0
18,925,213
2026
2027
913,162
913,162
397,303
348,147
76,396
85,904
5,412
913,162
0
0
18,103,367
2027
2028
1,082,931
1,092,931
397,303
348,147
229,198
102,773
5,520
1,082,931
0
0
17,128,729
2028
2029
1,167,816
1,167,916
397,303
348,147
305,585
111,151
5,631
1,167,816
0
0
16,077,695
2029
2030
1,167,816
1,167,816
397,303
348,147
305,585
111,038
5,743
3,167,816
0
0
15,026,660
2030
2031
1,167,816
1,167,816
397,303
348,147
305,585
110,923
5,858
1,167,816
0
0
13,975,626
2031
2032
1,167,816
1,167,816
397,303
348,147
305,585
110,806
5,975
1,167,816
0
0
12,924,591
2032
2033
1,167,816
1,167,816
397,303
348,147
305,585
110,687
6,095
1,167,816
0
0
11,873,557
2033
2034
1,167,816
1,167,815
397,303
348,147
305,585
110,565
6,217
1,167,816
0
0
10,822,523
2034
2035
1,167,816
11167XS
397,303
348,147
305,585
110,440
6,341
1110,816
0
0
9,771,488
2035
2036
1,167,816
1,267,816
397.303
348,147
305,595
110,314
6,468
2,167,826
0
0
8,720,454
2036
2037
1,167,816
1,167,816
397,303
348,147
305,585
110,194
6,597
1,167,816
0
0
7,669,419
2037
2038
1,167,816
1,167,816
397,303
348,147
305,585
110,052
6,729
1,167,816
0
0
6,618,385
2038
2039
1,167,816
1,167,816
397,303
348,147
305,585
109,918
6,864
1,167,816
0
0
5,567,351
2039
2040
1,167,816
1,167,816
397,303
348,147
305,585
109,780
7,001
1,167,816
0
0
4,516,316
2040
2041
1,167,816
1,167,816
397,303
348,147
305,585
109,640
7,141
1,167.816
0
0
3,465,282
2041
2042
1,167,816
1,167,816
397,303
348,147
305,585
109,498
7,284
1,167.816
0
0
2,414,247
2042
2043
1,167,816
1,167,816
397,303
305,585
457,499
7,430
1,167,916
0
0
1,711;360
2043
2044
1,167,816
1,167,816
397,303
305,585
457,350
7,578
1,167,816
0
0
1,008,472
2044
2045
1,167,816
1,167,816
397,303
305,585
457,199
7,730
1,167,816
0
0
305,595
2045
2046
1,167,816
1,167,816
305,585
854,347
7,884
1,167,816
0
0
0
2046
2047
1,167,816
1.167,816
1,159,774
8,042
1,167,916
0
0
0
2047
2048
1,167,816
1,167,816
1,159,613
8,203
1,167,816
0
0
0
2048
2049
1,167,816
1,167,816
1,159,449
8,367
1,167,816
0
0
0
2049
2050
1,167,816
1,167,816
1,159,282
8,534
1,167,816
0
0
0
2050
Total
28,957,771
28,957,771
9,343,364
5,918,496
5,806,107
8,679,549
210,256
28,957,771
Total
Incentive Present Value @ 5.25°6
Discount Rate
4,270,0001
3,140,000 1
2,660,000
1i
Projected District Closure
10,070,000 1
Total
Table 3 - Cash Flow
Tax Incremental District No. 43 Project Plan City of Oshkosh
Prepared by Ehlers Page 128
Exhibit F
Ground Lease Agreement
Document Number I Document Title
This LEASE AGREEMENT (the "Lease"), made and entered
into this day of April, 2023, is by and between the City of
Oshkosh, (CITY) a Wisconsin municipality, and the Redevelopment
Authority of the City of Oshkosh, (RDA), with their principal
offices located at 215 Church Ave., P.O. Box 1130, Oshkosh,
Wisconsin 54903-1130, (collectively "Lessor") and The Mill on Main
PH 1, LLC, a Wisconsin limited liability company ("Lessee"):
Recording Area
Name and Return Address
City Attorney's Office
215 Church Ave. P.O. Box 1130
Oshkosh, WI 54903-1130
Parcel No. 03-0139-03-00
RECITALS
1. RDA owns real property located along S. Main Street and comprised of the parcel number(s) identified
above (Project), in the City of Oshkosh, Winnebago County, Wisconsin.
2. The Project includes real property to be redeveloped described as attached Exhibit A and fully
incorporated into this Lease.
3. Lessor and Lessee, together with the City of Oshkosh, have entered into a Development Agreement
("Development Agreement") dated April 2023, and recorded with the Winnebago County Register
of Deeds as Document Number on the day of April, 2023, for the purpose of
constructing a mixed use development on the Leased Premises. A copy of the Development Agreement is
not attached hereto but Lessee acknowledges that it read and signed the Agreement, retains a copy of the
Development Agreement, is familiar with it and agrees to be bound by its terms as it may pertain to the
development of the Leased Premises. A copy of the development footprint is attached as Exhibit B and
incorporated herein.
4. Environmental remediation is required to be performed on the Leased Premises and certain funding
sources for this environmental remediation require that Lessor continue to retain ownership of the Leased
Premises until remediation is completed.
It is in both parties' interests that Lessee begin construction of the proposed development and related
improvements on the Leased Premises prior to the completion of the environmental remediation, and the
purpose of this Lease is to allow this commencement of construction.
The development of the Leased Premises described in the Development Agreement and in this Lease may
be financed through a lender (Lender). The Lender may request and be granted an interest in this Lease
up to and including the right to assume Lessee's rights and obligations under this Lease and under the
Development Agreement. However, the assignment of any Lessee interest in the Leased Premises must
be related to the development and pursuant to the terms of the Development Agreement, must be
contingent with such transfer becoming effective in the event of a default by Lessee, and must be
accompanied by a simultaneous written assumption by Lender of Lessee's obligations under the
Development Agreement. All assignments, transfers, conveyances of the Leased Premises will be subject
to continuing obligations under the Development Agreement.
AGREEMENT
7. All Recitals are incorporated into this Agreement.
8. In exchange for one dollar ($1.00) and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the Lessor agrees to lease to Lessee, and the Lessee agrees to accept
such lease of the property identified and described as the Leased Premises on the terms and conditions
expressly set forth and referenced herein.
9. The term of this Lease shall commence on the date it is executed by all parties, and shall end on the earlier
of:
(a) the date on which Lessee, or a Lender as may otherwise be allowed under a lease assignment,
closes on its purchase of and acquires full ownership interest in the Leased Premises;
(b) the date the Agreement is terminated by agreement of the parties;
(c) if the Development Agreement is terminated due to failure of Developer to proceed with the Project
as provided in Section IX.A.1 of the Development Agreement, the date the Development
Agreement is terminated; or
(d) the date that is fifty years after the date of commencement of this Lease.
10. Pursuant to the terms of the Development Agreement, Lessor and Lessee are obligated to cooperate with
respect to remediation actions at the direction of the Wisconsin Department of Natural Resources relating
to existing hazardous substances on the Leased Premises (Remediation). The Remediation shall be
performed pursuant to the terms of the Development Agreement, the terms of any grants utilized for this
purpose, and the terms required by the Wisconsin Department of Natural Resources (WDNR). Lessor and
Lessee will each take all necessary actions to obtain a Voluntary Party Liability Exemption (VPLE) from
the WDNR for the Leased Premises for any parcel on which remediation is deemed necessary.
Remediation of the site, if necessary, will not be completed until construction of the improvements on the
Leased Premises is completed, and the Leased Premises cannot be conveyed by Lessor until the
Remediation is determined to be unnecessary or is complete and any applicable grants used for
Remediation are closed out. Lessee shall close on its purchase of the Leased Premises upon a
determination that remediation is unnecessary or upon on the earliest practical date after both of the two
following events occur: (1) the issuance of the Certificate of Completion; and, (2) the closeout of any
Remediation grants; unless otherwise agreed upon in writing by the Parties. It is expected that the grants
will be closed out by the Agencies within one hundred twenty (120) days after the issuance of the
Certificate of Completion. All parties agree that the timely expiration of this Lease, and conveyance of
the Leased Premises, is in everyone's best interest and will work in good faith towards that end. Lessor
shall convey the Leased Premises to Lessee pursuant to this Lease and terms of the Development
agreement. The Parties acknowledge that if the Certificate of Completion is not received, or the closeout
if any Remediation grants does not take place, Lessee, at its election, is under no obligation to close on
the purchase of the Property and may continue to lease the Leased Premises for the remainder of the fifty
year lease term under this Lease, with any remaining environmental clean-up, if any, being the
responsibility of the City.
11. There shall be no Lease payments due from Lessee to Lessor other than the payment identified in
paragraph number 8, above, except as may be required by this Lease or the Development Agreement
during the term of this Lease.
12. The Lessee shall be allowed to construct and operate apartment facilities, as well as develop business
buildings and offices, retail spaces, and any and all related improvements on the Leased Premises as
approved by Lessor pursuant to the terms of the Development Agreement and consistent with other
government rules and regulations. No agreements by Lessee with others which purport to allow the use
of the Leased Premises in a manner contrary to this Lease, or to the Development Agreement, shall be
allowed, or enforceable, against Lessor or in rem against the Leased Premises.
13. During the term of this Lease, the Lessor shall be allowed reasonable access to the Leased Premises for
any purpose related to any municipal or police power function, to meet its obligations under this Lease or
the Development Agreement, or to function in its capacity as the owner of the Leased Premises. Lessor
shall make all reasonable efforts to not materially disrupt Lessee's allowed use of the property. Lessor
shall provide reasonable written notice to the Lessee prior to accessing the premises.
14. During the term of this Lease, Lessee shall be deemed the owner of all improvements constructed on the
Leased Premises by Lessee, subject to any legal rights and assignments to third parties. Lessor may take
actions to gain ownership of improvements upon the abandonment of the development and related
interests by Lessee, assignees, or others subject to the rights of the lenders and providing known interested
parties notice and a right to cure default or to affirm interest in the Leased Premises.
15. The Lessee has had sufficient access to the Leased Premises and as a result is or should reasonably be
aware of all aspects related to its condition. The Lessor makes no express or implied promises or
warranties related to the condition of the Leased Premises except those with respect to matters identified
in the Development Agreement.
16. Lessee assumes full and complete responsibility for any development activities, fixtures, or improvements
to the Leased Premises prior to the date Lessee purchases the Leased Premises pursuant to this Lease.
17. Lessee acknowledges that it assumes the responsibility of ensuring that its investments in or on the Leased
Premises are protected through separate agreements with its Lenders or other measures allowed by law.
18. Lessee shall have all necessary insurance with sufficient limits which will cover its employees, actions
and property on the Leased Premises. Lessee shall hold the Lessor harmless from any accident or incident
involving Lessee, its employees or agents, or any dispute with any 3rd party resulting from any action of
Lessee, its agents or assigns, occurring during the term of this Lease.
19. The Lessee is responsible for paying all utilities, costs, expenses, and obligations of any kind except those
incurred by or that are the responsibility of the City during the term of and under this Lease and the
Development Agreement. The Lessee is further required, at its expense, to keep and maintain in good
order, condition, and repair the Leased Premises and all improvements constructed thereon, including but
not limited to grounds and lawn maintenance and clearing of public sidewalks adjacent to the parcel
(Riverwalk and park areas shall be maintained by the City).
20. Lessee shall be responsible to pay all general property taxes on the Property (or, if such land is exempt
from general property taxes, additional rent in an amount equal to what such taxes would be if the Property
were not exempt), which accrue during the term of the Ground Lease.
21. Lessee shall not allow any encumbrance to be fled on or against the Leased Premises, including
mortgages, easements, or similar restrictions, except for the assignment to Lenders provided under Section
6 of this Agreement.
22. All terms of the Development Agreement pertaining to the Leased Premises are incorporated into this
Lease, including but not limited to representations and warranties. Lessor and Lessee may pursue any
breach or default of this Lease or of the Development Agreement as allowed by law.
23. Lessee's restrictions on the use of the Leased Premises during the terms of this Lease are set forth in the
Development Agreement, and are specifically incorporated into this Lease. All other terms, conditions,
benefits, burdens, and agreements between these parties relating to the Leased Premises shall remain in
full force and effect, without alteration.
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date first above written.
LESSEE:
LESSOR:
The Mill on Main Ph 1, LLC City of Oshkosh
By: ` By:
T e e . Wall, Presi ent of Mar A. Rohloff, City
T. all Enterprises Manager, L , its anager
By:
.lessi Balco k, City
Oshkosh RedevelgfTent Authority
M
This document drafted by:
Lynn A. Lorenson
City Attorney
Oshkosh, Wisconsin 54903
Chair
Nieforth, Executive Director
,essee shall be responsible to pay all general property taxes on the Property (or, if such land is exempt
'rom general property taxes, additional rent in an amount equal to what such taxes would be if the Property
,vere not exempt), which accrue during the term of the Ground Lease.
21. Lessee shall not allow any encumbrance to be filed on or against the Leased Premises, including
mortgages, easements, or similar restrictions, except for the assignment to Lenders provided under Section
6 of this Agreement.
22. All terms of the Development Agreement pertaining to the Leased Premises are incorporated into this
Lease, including but not limited to representations and warranties. Lessor and Lessee may pursue any
breach or default of this Lease or of the Development Agreement as allowed by law.
23. Lessee's restrictions on the use of the Leased Premises during the terms of this Lease are set forth in the
Development Agreement, and are specifically incorporated into this Lease. All other terms, conditions,
benefits, burdens, and agreements between these parties relating to the Leased Premises shall remain in
full force and effect, without alteration.
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date first above written.
LESSEE: LESSOR:
The Mill o'h,,VIain Ph 1, ]iLC City of Oshkosh
By: VBy:�_.
Terrence R. W 11\resident of Mark A. Rohloff, City Manager
T. Wall Ente risnager, LLC, its Manager By: Q�Vjawx &V�I-Vn
Jessi Valcom, City Clerk
Oshkosh Redevelopment Authority
By: o— 1/`-
Chair
By:
elly e rth, Exec tive D rector
This document drafted by:
Lynn A. Lorenson
City Attorney
Oshkosh, Wisconsin 54903
Exhibit A
Legal Description of Phase I Parcel
Lot 1 of Certified Survey Map No. 8005, recorded with the Winnebago County Register of Deeds as Document
No. 1899509, being a part of the Southwest'/4 of Section 24, all in Township 18 North, Range 16 East, City of
Oshkosh, Winnebago County, Wisconsin.
EXHIBIT B
Description of Project Plan
Tax Incremental District ("TID") No. 43 ("District") is a proposed 13.45-acre Blighted Area District located on
the Fox River generally east of S. Main Street, north of E. I Oh Avenue and west of Pioneer Drive in the Sawdust
District. The District will be created to pay the costs of development incentives and public infrastructure to permit
a mixed -use redevelopment project with 291-multifamily apartment units and 21,800 square feet of commercial
space ("Project") to be developed by The Mill on Main, LLC ("Developer"). The Project will include construction
of a private clubhouse, pickleball courts, an amphitheater, Riverwalk connection and other amenities. Property in
the District was previously identified for redevelopment in the 2003 South Shore Redevelopment Area Project
Plan and the 2020 Sawdust District Master Plan.