HomeMy WebLinkAbout240 Algoma Blvd Development Agreement 2016 DEVELOPMENT AGREEMENT
This Development Agreement(the "A r_g eement") is made as of the 21st day of July, 2016
(the "Effective Date") by and between the CITY OF OSHKOSH, WISCONSIN, a Wisconsin
municipal corporation (the "City"), and 240 ALGOMA BLVD LLC, a Wisconsin limited
liability company (the "Developer"}.
RECITALS
A. The Developer has purchased certain property known as the Orville Beach
Memorial Manual Training School, located at 240 Algoma Boulevard in the City of Oshkosh,
Wisconsin, which property is more particularly described on Exhibit A attached hereto (the
"Property").
B. The Developer plans to redevelop the Property into a mixed-use commercial and
residential building with surface parking as approved by the Common Council on June 14, 2016
through Resolution 16-306 (the "Project").
C. Pursuant to Wis. Stats. §66.1105 (the "Tax Increment Law"), the City has (i)
created Tax Increment District No. 28 (Beach Building Redevelopment Project) (as amended
from time to time, the "TIF District"), and (ii) approved a project plan for the redevelopment of
the TIF District(as amended from time to time the "TIF District Project Plan").
D. The Property is located within the TIF District.
E. The Developer desires to redevelop and operate the Property in accordance with
the provisions of this Agreement and the TIF District Project Plan.
F. The Developer's ability to develop the Project is contingent upon the City
providing financial and other assistance to Developer on the terms set forth in this Agreement.
G. The City finds it to be in the public interest to utilize tax incremental financing to
assist the Developer to undertake the Project, consistent with the terms and conditions of this
Agreement.
H. Funds used to provide the Developer with the tax incremental financing for the
Project Costs (the"TIF Funds") shall be raised solely from tax income generated from the Project
in the TIF District.
I. The City finds that construction of the Project, and fulfillment of the terms and
conditions of this Development Agreement are in the vital and best interest of the City and its
residents and fulfill a public purpose in accordance with state law.
NOW THEREFORE, in consideration of the foregoing recitals that are incorporated
hereto and inade a part of this Agreement, the promises, covenants and agreements contained in
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this Agreement and other good and valuable consideration, the receipt and sufficiency of which
are acknowledged, the Developer and the City promise, covenant and agree as follows:
1. Definitions. As used in this Agreement, the following terms shall have the
following meanings:
"Affiliate" means any entity that, directly or indirectly, controls, is controlled by
or is under common control with a party to this Agreement or such party's successors
and/or assigns. For purposes of this definition, "control" means possessing the power to
direct or cause the direction of the management and policies of the entity by the
ownership of a majority of the voting securities of the entity.
"City" means the City of Oshkosh, Wisconsin, a Wisconsin municipal
corporation, its successors and assigns.
"City Contribution" means payments provided by the City to the Developer from
future Tax increments as set forth in Section 2, below.
"Completion Date"means December 31, 2016.
"Default" means the occurrence of one or more of the events described in Section
17, below.
"Equity Contribution" means an investment by Developer of not less than One
Million Four Hundred Ninety Four Thousand Seven Hundred Fourteen and No/100
Dollars ($1,494,714.00) in the Project.
"Expiration Date" means the date of termination of the TIF District under Wis.
Stat. §66.1105(7).
"Loan"means one or more loans to fiend Project Costs in the maximum amount of
One Million Eight Hundred Thousand and No/100 Dollars ($1,800,000.00).
"Project Costs" means the total costs of acquiring and constructing the Project,
including all capital expenditures (or expenditures that could be treated as capital
expenditures) and preliminary expenditures (such as architectural, engineering,
surveying, soil testing 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 in accordance with the Project Plans.
"Project Plans" means final detailed plans and specifications for the Project, and
all other improvements to be located on the Property.
"Property" means the parcel of land upon which the Project is located, as legally
described on Exhibit A.
"Term"means the period of time from the Effective Date of this Agreement to the
Expiration Date.
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"TIF District" means Oshkosh Tax Incremental District No. 28 (Beach Building
Redevelopment).
"Tax Increment" shall have the meaning given under Wis. Stat. §66.1105(2)(i)
but shall be limited to the Tax Increment attributable to the Property and the
improvements on the Property.
2. City Contribution. Subject to all the terms and conditions of this Agreement and
applicable law, the City will provide payments to the Developer solely from future Tax
Increments to assist with Project Costs. The City Contribution shall be payable beginning in
2018. The City Contribution will be equal to ninety percent (90%) of the Tax Increment
attributable to the Property, which shall be calculated by subtracting the TIF District base value
from the assessed value of the Property as of January 1, 2017 and each year thereafter, and
multiplying the result, if positive, by the mill rate for all taxing jurisdictions established for each
year. The City Contribution shall be due and payable to the Developer on or about [Oct" 30
2Q8] and each ''[Octoex 36] thereafter, The City's obligation to make the City Contribution
shall end and expire as of the earlier of(i) the Expiration Date, or (ii) the receipt by Developer of
the Approved Contribution in the event that the City Contribution is limited by operation of
Section 3, below. A pro forma City Contribution calculation is attached hereto as Exhibit B.
Payments under this Agreement shall be solely from Tax Increment attributable to
the Property actually received by the City. In no event shall the City's payment to the Developer
exceed the total Tax Increment generated by the Property. The City Contribution shall be a
special and limited obligation of the City and not a general obligation. The City covenants and
agrees, however, not to utilize any Tax Increment received with respect to the Property during
any year for any purpose other than payment of the City Contribution unless and until the City
has paid the City Contribution in full for such year.
The Developer acknowledges that, as a result of the special and limited nature of
the City's obligation to pay the City Contribution, the Developer's recovery of the City
Contribution depends on various factors including, but not limited to, future mill rates, changes
in the assessed value of the Property, failure of the Property to generate Tax Increments at the
rate expected by the Developer, changes in the Tax Increment Law, and other failures beyond the
City's and/or the Developer's control. Additionally, the City shall have no obligation to make
the City Contribution unless and until the Developer has made all payments owed to the City by
Developer for real estate taxes,personal property taxes, special assessments, and special charges.
3. City Contribution Adjustment. The City Contribution amount is based upon the
proforma ten (10) year Internal Rate of Return ("IRR") submitted by the Developer to the City, a
copy of which is attached hereto as Exhibit C. Developer and the City agree that to the extent
that the project's performance varies materially from the proforma IRR, the City Contribution
may be adjusted pursuant to this Section 3.
On or before the thirtieth (30'h) day following the tenth (10'h) anniversary of the
Completion Date (the "Test Date"), Developer shall provide the City with copies of all
internally prepared financial statements (kept in accordance with generally accepted accounting
principles) and a complete annual cash flow update based on actual income and expenses (in a
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format consistent with the example in Exhibit C) for the Project for the period from the
Completion Date to the Test Date. Within ten (10) business days thereafter, Developer and the
City shall, using information from the financial statements and cash flow update, and the
methodology utilized to calculate the original Project proforma IRR (as set forth on Exhibit C),
and applying the Approved Assumptions (as defined below) to supply any information that is not
known as of the Test Date, calculate the actual IRR as of the Test Date.
If the actual IRR calculated on the Test Date as proposed based upon the updated analysis
exceeds 15 percent (15%), the City shall reduce the City Contribution to the amount necessary to
allow Developer to achieve a fifteen percent (15%) annual IRR over the Teen (the "Approved
Contribution"). In the event that the City has already paid Developer more than the Approved
Contribution as of the Test Date, Developer shall refund such excess City Contribution to the
City within ninety (90) days of the recalculation date.
As used herein, the "Approved Assumptions" shall be the present value of historic tax
credits, terminal capitalization rate, lease rates and all other assumptions agreed upon by
Developer and the City as of the date the proforma IRR is updated, and absent such agreement,
as determined by an independent MAI appraiser with not less than ten (10) years' experience
appraising commercial and multi-family properties in the Appleton-Oshkosh-Neenah
metropolitan statistical area. All costs for the independent appraiser shall be shared equally by
the City and the Developer.
4. Conditions Precedent to City's Obligations. In addition to all other conditions
and requirements set forth in this Agreement, the obligations of the City hereunder (including,
without limitation, the obligation of the City to pay the City Contribution) are conditioned upon
the satisfaction of each and every of the following conditions:
(a) On or before the date of this Agreement, the Developer shall provide the
City an opinion of its counsel reasonably acceptable to the City stating, among other
things, that the persons executing this Agreement on behalf of the Developer are
authorized to do so, that the Developer has duly authorized entry into this Agreement,
and other matters as are reasonably requested by the City.
(b) On or before the date of this Agreement, the Developer shall have
provided the City with (i) certified copies of its Articles of Organization and Operating
Agreement, and (ii) a current Certificate of Status issued by the Wisconsin Department of
Financial Institutions.
(c) On the date of each payment made to Developer pursuant to Section 2,
above, no uncured default, or event which with the giving of notice or lapse of time or
both would be a default, shall exist under this Agreement.
(d) The Developer shall have made the Equity Contribution to the Project and
provided proof of such Equity Contribution to the City in the same manner as required by
the provider of the Loan.
Unless all conditions contained in this Section 4 are satisfied within the time
periods for satisfaction of such conditions as set forth above or such conditions are waived in
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writing by the City within the time periods for satisfaction of such conditions as set forth above,
the City, at its option, exercised in its sole discretion, may terminate this Agreement, in which
event none of parties to this Agreement shall have any fiirther liability or other obligation to the
other parties.
5. Representations, Warranties of Developer. The Developer represents and
warrants to the City as follows:
(a) The Developer is a limited liability company duly organized and validly
existing and has the power and all necessary licenses, permits, and franchises to own its
assets and properties and to carry on its business.
(b) The Developer is duly licensed or qualified to do business in the State of
Wisconsin and all other jurisdictions in which failure to do so would have a material
adverse effect on its business or financial condition.
(c) The execution, delivery and performance of this Agreement have been
duly authorized by all necessary limited liability company action of the Developer and
constitute the valid and binding obligations of the Developer enforceable in accordance
with their terms, subject only to applicable bankruptcy, insolvency, reorganization,
moratorium, general principles of equity, and other similar laws of general application
affecting the enforceability of creditors' rights generally.
(d) The execution, delivery, and performance of the Developer's obligations
pursuant to this Agreement will not violate or conflict with the Developer's Articles of
Organization or Operating Agreement or any indenture, instrument or agreement by
which the Developer is bound, nor will the execution, delivery or performance of the
Developer's obligations pursuant to this Agreement violate or conflict with any haw
applicable to the Developer or to the Project.
(e) There is no litigation or proceeding pending or affecting the Developer or
the Project, or, to the best of the Developer's knowledge, threatening the Developer or
the Project, that would adversely affect the Project or the Developer or the enforceability
of this Agreement, the ability of the Developer to complete the Project or the ability of
the Developer to perform its obligations under this Agreement.
(f) To the best of the Developer's knowledge, no default, or event which with
the giving of notice or lapse of time or both would be a default, exists under this
Agreement, and the Developer is not in default (beyond any applicable notice and cure
period) of any of its obligations under any other agreement or instrument to which the
Developer is party or obligor.
b. Covenants of Developer. During the Term of this Agreement, the Developer
covenants to the City as follows:
(a) The Developer shall pay for all work performed and materials furnished
for the Project as and when due.
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(b) On or before the Completion Date, the Project shall be completed (subject
to matters of force majeure), and in all other respects be ready for occupancy and use by
the Developer.
(c) The Developer shall conform and comply with, and will cause the Project
to be in conformance and compliance with, all applicable federal, state, local and other
laws, rules, regulations and ordinances, including without limitation, all zoning and land
division laws, rules, regulations, and ordinances, all building codes and ordinances of the
City, and all environmental laws, rules,regulations, and ordinances.
(d) The Developer shall cause the Project to be constructed in a good and
workmanlike manner and substantially in accordance with the Project Plans and will
promptly correct any defects, structural or otherwise, in any construction or deviations
from the Project Plans. Construction of the Project shall be completed free of all liens
and encumbrances except for those liens and encumbrances permitted by this Agreement.
(e) The Developer shall pay or cause to be paid prior to delinquency all
federal, state and local taxes in connection with the Project. The Developer shall pay
when due all operating expenses in connection with the Project.
(f) The Developer shall comply with the requirement to provide notification
of position openings under Wis. Stat. § 66.1105(6c), and, to the extent notified by the
City prior to the date of this Agreement, with any other applicable material restriction
affecting the TIF District and with all laws, rules, regulations and ordinances generally
applicable to tax increment districts that are applicable to the Project,
(g) The Developer shall have in effect at all times, all permits, approvals and
licenses that may be required by any governmental authority or nongovernmental entity
in connection with the development, construction, management and operation of the
Project.
(h) Except for a mortgage, any related assignment(s) of leases and rents
and/or other collateral documentation in favor of Lender securing the Loan, the
Developer will not mortgage or otherwise place a lien or encumbrance on the Property
without first obtaining the City's consent.
(i) The Developer, at its cost and expense, shall operate, maintain, repair and
replace (including without limitation, repairs and replacements of a capital nature) all
elements of the Project. The Developer's maintenance and repair obligations shall
include both day to day maintenance and repair and extraordinary maintenance and repair
and shall include maintenance, repair and replacement of all elements or systems of the
Project as are necessary in order to maintain the Project. The Developer will not defer
any required maintenance, repair or replacement (including, without limitation, repairs
and replacements of a capital nature) of any element of the Project and shall establish
adequate reserves therefore.
0) The Developer will not, without the City's consent, initiate any change in
the zoning classification of all or any portion of the Property.
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7. Damage, Destruction. In the event of fire, damage, or any other casualty to any
part of the Project, the Developer agrees, at its cost and expense, to rebuild, repair and replace
the Project in the condition it was in immediately prior to the casualty. The fair market value of
the Project following reconstruction and/or repair by the Developer must be greater than or equal
to the fair market value of the Project immediately prior to the casualty.
If the Project is required to be rebuilt or repaired or replaced, then the Project shall be
rebuilt, repaired or replaced in accordance with plans and specifications prepared by the
Developer and approved by the City. The Developer agrees to apply any necessary portion of
the insurance proceeds to rebuild, repair and replace the Project. The proceeds of insurance shall
be disbursed for the replacement, rebuilding or repair of the Project pursuant to the terms and
conditions of a disbursing agreement among the City, the Developer and an escrow agent
mutually agreed upon by the City and the Developer. Any amount required in excess of
insurance proceeds for rebuilding, repair and/or replacement of the Project shall be paid by the
Developer.
8. Costs. The Developer shall each year during the Term of this Agreement pay all
reasonable and itemized fees, costs and expenses actually incurred by the City, including
administrative costs and attorneys' and consultants' fees, in connection with any modification to
the TIF District Project Plan required as a result of the Project, the negotiation, preparation and
administration of this Agreement and all documents and agreements executed in connection
therewith. Following the first year of the Term of this Agreement, and so long as Developer is
not in default under the terms of this Agreement, Developer's obligation under this Section 8
shall be limited to reimbursement of third party fees paid by the City in an amount not exceed
Two Thousand Five Hundred and No/100 Dollars ($2,500.00)per year. Developer shall also pay
all reasonable and itemized fees, costs and expenses actually incurred by the City, including
attorneys' and consultants' fees, in connection with the enforcement of its rights against the
Developer under the TIF District Project Plan or this Agreement, including without limitation,
the enforcement of such rights in any bankruptcy, reorganization or insolvency proceeding
involving the Developer. Developer will be billed for such costs and payment is due within 30
days of the date of invoice. Developer's obligation to pay these costs is secured by the City's
right of special assessment pursuant to Section 11, below.
9. City's Right to Cure Default. In case of a failure by the Developer to procure or
maintain insurance, or to pay any fees, assessments, charges or taxes arising with respect to the
Project or to comply with the terms and conditions of this Agreement or any other document,
contract or agreement effecting the Project, the City shall have the right, but shall not be
obligated, to effect such insurance or pay such fees, assessments, charges or taxes or take such
action as is necessary to remedy the failure of the Corporation to comply with the documents,
contracts or agreements effecting the Project, and, in that event, the cost thereof shall be payable
by the Developer to the City.
10. Real Estate Taxes and Assessments. The Developer shall pay timely to the City
generally applicable property taxes assessed and levied by the City on the Property under
applicable property tax laws, rules, rates, regulations and ordinances in effect from time to time.
Nothing in this Agreement shall impair any statutory rights of the City with respect to the
assessment, levy, priority, collection, and/or enforcement of real estate property taxes. In
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addition, the Developer agrees to pay timely to the City all special assessments that may be
assessed or levied in connection with the Property under the applicable special assessment laws,
rules, regulations, ordinances and rates in effect at the time said special assessments are assessed
or levied.
11. Securi1y for Developer's Obligations. The Developer's obligations under Section
8 shall be secured by the City's right of special assessment or by any other remedy available to
the City by statute. If the Developer fails to pay timely any City costs due under Section 8, the
City may, in addition to all other remedies available to it in law or equity, levy the amount of the
overdue obligation against the Property as a special assessment pursuant to Wis. Stat. §66.0701.
In connection therewith, the Developer: (i) acknowledges that the City has incurred costs for the
payment or reimbursement of the Project Costs; (ii) agrees that the amount of the special
assessment, if levied consistent with this Agreement, constitutes a proper exercise of the City's
authority to levy special assessments in accordance with Wis. Stat. §66.0701; (iii) agrees that the
allocation of the City's costs to the Property is reasonable and commensurate with the special
benefits provided to the Property; (iv) agrees that the amount being assessed in accordance with
this Agreement does not exceed the value of the benefits accruing to the Property from the City's
expenditures identified herein; (v) consents to the imposition and levy of such special
assessments; (vi) agrees that the approval of this Agreement by the Oshkosh Common Council
shall be sufficient to authorize the levy of special assessments in accordance herewith, and that
no further procedural steps need be taken by the City; (vii) waives all special assessment notices,
hearings and appeals provided by Wis. Stats. §66.0701 or §66.0703; and (viii) acknowledges that
the City is relying on the terms of this Agreement, and specifically the terms of this subsection,
that such reliance is reasonable, and that the City's payment of its obligations to the Developer
under this Agreement will be detrimental to the City if the provisions relating to special
assessments are not enforced and that a failure to enforce such agreements would be inequitable.
12. [Resex•ved1.
13. Indemnifications. The Developer hereby indemnifies, defends and holds the City
harmless from and against all loss, liability, damage and expense, including reasonable
attorneys' fees, suffered or incurred by the City to the extent caused by the following: (a) the
failure of the Developer or its contractors, subcontractors, agents, employees, or invitees to
comply with any environmental law, rule, regulation or ordinance, or any order of any regulatory
or administrative authority with respect thereto; (b) any release by the Developer or its
contractors, subcontractors, agents, employees or invitees of petroleum products or hazardous
materials or hazardous substances on, upon or into the Project; (c) any and all damages to natural
resources or real property or harm or injury to persons resulting or alleged to have resulted from
any failure by the Developer and/or its contractors, subcontractors and/or agents to comply with
any law, rule, regulation or ordinance or any release of petroleum products or hazardous
materials or hazardous substances as described in clauses (a) and (b) above; (d) claims arising on
the Property under the Americans with Disabilities Act, and any other laws, rules, regulations or
ordinances; (e) claims for third parties for injury to or death of any person on the Property; and
(f) the failure of the Developer to maintain, repair or replace as needed any portion of the
Project.
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The term"hazardous substances"means any flammable explosives, radioactive materials,
hazardous wastes, toxic substances, or related materials, including, without limitation, any
substances defined as or included in the definition of "hazardous substances," "hazardous
waste," "hazardous materials," or "toxic substances" under any applicable federal or state or
local laws or regulations.
14. Insurance. The Developer shall maintain the following insurance policies issued
by insurers with a rating of at least "A-" and in a financial size category of at least "X" as
established by A.M. Best Company and licensed to do business in the State of Wisconsin; (i)
property insurance on the Property with coverage limits equal to the Rill replacement cost of the
building and contents; (ii) commercial general liability insurance with limits of$1,000,000 per
occurrence and $5,000,000 in the aggregate; (iii) statutory worker's compensation insurance; and
(iv) automobile liability insurance with a combined single limit of$1,000,000.
Each insurance policy shall require the insurer to provide at least thirty (30) days prior
written notice to the City of any material change or cancellation of such policy.
15. Nondiscrimination. The Developer shall not use the Project in any manner to
permit discrimination or restriction on the basis of race, creed, ethnic origin or identity, color,
gender, religion, marital status, age, handicap or national origin, and the Developer shall
construct and operate the Project in compliance with all laws, rules, regulations and ordinances
relating to discrimination or any of the foregoing.
16. Property Tax Challenges and Exemptions. The Developer shall not cause or
permit the Property or any portion thereof to become tax exempt unless condemned by a
governmental entity. The Developer will place a restriction in any deed conveying all or any
portion of the Property prohibiting any use or ownership of the Property which would cause the
Property or any portion thereof to become tax exempt. If the Property nevertheless becomes tax
exempt, Developer, for its successors and assigns, hereby agrees that an annual payment in lieu
of tax shall be made by the then-owner of the Property. Such payment in lieu of tax shall be
determined for any given year that the Property is exempt from taxation by multiplying the
Property's last assessed value prior to becoming exempt by the mill rate for all taxing
jurisdictions established for that tax year for the TIF District, with such payment due and payable
on or before December 31 of the year in question,
17. Default. The occurrence of any one or more of the following events shall
constitute a default hereunder:
(a) The Developer or any successor shall fail to pay when due any Guaranty
Payment or other amount due from it under this Agreement; or
(b) Any representation or warranty made by the Developer or any successor in
this Agreement or any document delivered by the Developer or its successor pursuant to
this Agreement shall prove to have been false in a material way as of the time made or
given; or
(c) The Developer or any successor shall breach or fail to substantially
perform timely or observe timely any of its covenants or obligations under this
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Agreement, and such failure shall continue for thirty (30) days following notice thereof
from the City to the Developer (or such longer period of time as is necessary to cure the
default as long as the Developer has commenced the cure of the default within the thirty
(30) day period and is diligently pursuing to cure the default and as long as the default is
cured not later than one hundred eighty (180) days following notice thereof from the
City); or
(d) The Project is not substantially completed on or before the Completion
Date(subject to matters offorce majeure); or
(e) The 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; or (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 a petition or
application, admitting material allegations thereof, or (v) apply to a court for the
appointment of a receiver or custodian for any of its assets or properties or have a
receiver or custodian appointed for any of its assets or properties, with or without
consent, and such receiver shall not be discharged within ninety (90) days after its
appointment; or(vi) adopt a plan of complete liquidation of its assets.
18. Remedies. Upon the occurrence of any default, without further notice, demand or
action by any kind by the City, the City may, at its option, pursue any one or more of the
following remedies concurrently or successively:
(a) Cease all future payments of the City Contribution; or
(b) Pursue any or all of the rights and remedies available to the City at law
and/or in equity against the Developer and/or the Project.
Except as may be otherwise specifically set forth herein, no remedy herein conferred
upon the City is intended to be exclusive of any other remedy and each and every such remedy
shall be cumulative and shall be in addition to every other remedy given under this Agreement,
and/or available to the City under the TIF District Project Plan and any other covenants,
restrictions, documents or instruments governing the TIF District, and/or now or hereafter
existing at law or in equity. No failure or delay on the part of the City in exercising any right or
remedy shall operate as a waiver thereof nor shall any single or partial exercise of any right
preclude other or further exercise thereof or the exercise of any other right or remedy.
Notwithstanding any of the foregoing authorizations, the City shall have no duty or obligation
whatsoever with respect to any of the matters so authorized.
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19. No Personal Liability. Under no circumstances shall any council member,
official, director, attorney, employee, or agent of a party have any personal liability arising out of
this Agreement, and no party shall seek or claim any such personal liability.
20. City Authorization. The execution of this Agreement by the City is authorized by
Common Council Resolution No. dated , 2016.
21. Miscellaneous.
(a) Except as otherwise specifically set forth herein, the respective rights and
liabilities of the City and the Developer in this Agreement are not assignable or
delegable, in whole or in part, without the prior written consent of the other party.
Provisions of this Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
(b) No waiver, amendment, or variation of the terms of this Agreement shall
be valid unless in writing and signed by the City and the Developer, and then only to the
extent specifically set forth in writing.
(c) All material applicable agreements, representations, warranties, covenants,
liabilities and obligations made in this Agreement and in any document delivered
pursuant to this Agreement shall remain effective during the Term of this Agreement.
(d) All communications or notices required or permitted by this Agreement
shall be in writing and shall be deemed to have been given: (i) upon delivery to an officer
or the person entitled to such notice, if hand delivered, or (ii)two business days following
deposit in the United States Mail, postage prepaid, or with a nationally recognized
overnight commercial carrier that will certify as to the date and time of delivery, air bill
prepaid, or (iii) upon transmission if by facsimile, any such communication or notice
shall be addressed as follows, unless and until any such party notifies the other in
accordance with this section of any change of address:
If to the City: City of Oshkosh
City Attorney's Office
215 Church Avenue
Post Office Box 1130
Oshkosh, WI, 54903-1130
Attn: City Attorney
Facsimile No. (920) 236-5106
With a copes: Godfrey&Kahn, S.C.
100 West Lawrence Street
Appleton, WI 54911
Attn: Michael J. Lokensgard
Facsimile No. (920) 830-3530
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If to the Develop 240 Algoma Blvd LLC
PO Box 1099
Oshkosh, WI 54903-1099
Attn: Eric Hoopman
crit@hoopman.co
With a copy to: Chet Wesenberg
146 Algoma Blvd., Suite H
Oshkosh, WI 54901
Chet.Wesenberg@CWArchitect.net
(e) This Agreement and the documents executed pursuant to this Agreement
contain the entire understanding of the parties with respect to the subject matter hereof.
There are no restrictions, promises, warranties, covenants or understandings other than
those expressly set forth in this Agreement and documents executed in connection with
this Agreement. This Agreement and the documents executed in connection herewith
supersede all prior negotiations, agreements and undertakings between the parties with
respect to the subject matter hereof.
(f) This Agreement is intended solely for the benefit of the Developer and the
City, and no third party (other than successors and permitted assigns) shall have any
rights or interest in any provision of this Agreement, or as a result of any action or
inaction of the City in connection therewith. Without limiting the foregoing, no
approvals given pursuant to this Agreement by the Developer or the City, or any person
acting on behalf of either of them, shall be available for use by any contractor or other
person in any dispute with the construction of the Project.
(g) This Agreement shall be governed by, and construed and interpreted in
accordance with, the laws of the State of Wisconsin applicable to contracts made and
wholly performed within the State.
(h) This Agreement may be executed in several counterparts, each of which
shall be deemed an original, but such counterparts shall together constitute but one in the
same Agreement. Facsimile signatures shall be deemed original signatures for all
purposes of this Agreement.
(i) Any provision of this Agreement which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be in effect to the extent of such prohibition
or enforceability without invalidating the remaining provisions of this Agreement in such
jurisdiction or affecting the validity or enforcement of any provision in any other
jurisdiction.
6) Nothing contained in this Agreement or any other documents executed
pursuant to this Agreement shall be deemed or construed as creating a partnership or joint
venture between the City and the Developer or between the City and any other person, or
cause the City to be responsible in any way for the debts or obligations of the Developer
or any other person or cause the Developer to be responsible in any way for the debts or
12
15615909.6
obligations of the City or any other person. Each party represents, warrants and agrees,
for itself and its successors and assigns, not to make any assertion inconsistent with its
acknowledgement or with the acknowledgement and agreement contained in the
preceding sentence in the event of any action, suit or proceeding, at law or in equity, with
respect to the transactions which are the subject of this Agreement and this paragraph
may be pleaded and construed as a complete bar and estoppel against any assertion by or
for a party and its successors and permitted assigns, that is inconsistent with its
acknowledgement and agreement contained in the preceding sentence.
(k) Time is of the essence as to each and every obligation or agreement
contained in this Agreement.
(1) If any party is delayed or prevented from timely performing any act
required under this Agreement other than the payment of money, by reason of fire,
earthquake, war, terrorist act, flood, riot, strikes, labor disputes or shortages, government
restrictions, judicial order, public emergency, or other causes beyond the reasonable
control of the party obligated to perform, the performance of such act shall be excused for
the period of such delay and the time for the performance of any such act shall be
extended for a period equivalent to such delay.
(m) A memorandum of this Agreement may be recorded in the office of the
Register of Deeds of Winnebago County, Wisconsin, in lieu of the full Agreement, it
being understood by the parties that until Expiration Date, this Agreement will run with
the land and will be binding upon the Property. In the event that a separate storm water
maintenance agreement is not entered into by the parties and recorded with the Register
of Deeds, then Developer shall fully comply with the grading and drainage plan for the
Property on file with the City Department of Public Works and all applicable storm water
codes. The City shall have the authority to enter the property and resolve all grading and
drainage issues at Developer's expense including, without limitation, special charges for
such work being placed against the Property. This Agreement inures to the benefit of the
City and its successors and assigns.
(n) The headings to this Agreement are for reference only and are not
intended to modify any of the terms and conditions of this Agreement.
(o) Nothing contained in this Agreement is intended to or has the effect of
releasing the Developer from compliance with all applicable laws, rules, regulations and
ordinances in addition to compliance with all the terms, conditions and covenants
contained in this Agreement.
(p) This Agreement is the product of negotiation between the parties hereto
and no term, covenant or provision herein or the failure to include a term, covenant or
provision shall be construed against any party hereto solely on the basis that one party or
the other drafted this Agreement or any term, covenant or condition contained herein.
13
15615909.6
(q) Upon mutual consent of the parties to this Agreement, which consent any
party can withhold in its sole discretion, the parties can agree to submit disputes arising
under this Agreement to alternative dispute resolution.
(r) EACH PARTY TO THIS AGREEMENT HEREBY WAIVES TRIAL BY
JURY IN ANY ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM,
WHETHER CONTRACT OR TORT, AT LAW OR EQUITY, ARISING OUT OF OR
IN ANY WAY RELATED TO THIS AGREEMENT.
(s) All amounts not paid when due hereunder shall bear interest at the rate of
twelve percent(12%).
22, Other Approvals. In addition to any approvals required under this Agreement, the
Developer shall be required to obtain all approvals, consents, and licenses as may be required by
any governmental or nongovernmental authority in connection with the Project, including,
without limitation, all building permits, Project Plan approvals, storm water approvals, and
zoning approvals. The Developer's compliance with the terms of this Agreement shall not
relieve the Developer from complying with all applicable federal, state and local laws, rules,
regulations and ordinances in connection with the Project and to the extent any governmental or
non-governmental entity imposes different or more restrictive conditions on the Developer or the
Project, compliance by the Developer with the terms of this Agreement shall not relieve the
Developer from complying with such different or more restrictive conditions. Likewise, any less
restrictive conditions imposed on the Developer or the Project by any governmental or non-
governmental authority shall not relieve the Developer or the Project from complying with all of
the terms and conditions of this Agreement.
[SIGNATURE PAGES FOLLOW]
14
15615909.6
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
CITY OF OSHKOSH, WISCONSIN
By: .---J�--
Mark A. Rohloff
Its: City Manager
By:
Pamela R. Ubrig
Its: City Clerk
Approved as to form.:
B 0.1 IXIVJ
nn A. ore n
Its: City Attorney
I hereby certify that the necessary provisions have been made to pay the liability which
will accrue under this Agreement.
3ropg
Trena Larson, Finance Director
[SIGNATURES AND ACKNOWLEDGEMENTS CONTINUED NEXT PAGE]
15
15615909.6
STATE OF WISCONSIN }
) SS
COUNTY OF WINNEBAGO )
Personally came before me this Z� — day of , 2016, the above-named Mark A.
Rohloff and Pamela R. Ubrig, to me known to be the City M ager and City Clerk of the City of
Oshkosh, Wisconsin and the person who executed the foregoing document and acknowledged
the same.
xV �
Notary Public, Sta e of 1 • c_csY.S')' . ;
My commission;
16
15615909.6
240 ALGOMA BLVD LLC
By:
4&Z4
Name: CHET KWESENBERG
Its: Member ---------
B
---- -B
Na HOOPMAN
Its: Ma aging Member
STATE OF WISCONSIN )
} SS
COUNTY OF WINNEBAGO }
s'�
On this __C>?[ day of 2016 personally came before me Chet A.
Wesenberg, member, and Eric S. Hoopmah, managing member, of 240 Algoma Blvd LLC, a
Wisconsin limited liability company, and the persons who executed the foregoing instrument and
acknowledged the same.
Notary Public, State ofiscons'a1`'
My commission�XOr l
c.I W,
17
15615909.6
Exhibit A
Property Legal Description
ALL OF BEACH BUILDING CONDOMINIUM, A PART OF LOTS 13, 15, 17 AND 23 OF BLOCK
G OF LEACH'S MAP OF 1894, LOCATED IN THE SOUTHWEST Y OF THE NORTHWEST '/a
OF SECTION 24, TOWNSHIP 18 NORTH, RANGE 16 EAST, SEVENTH WARD, CITY OF
OSHKOSH, WINNEBAGO COUNTY, WISCONSIN BOUNDED AND DESCRIBED AS
FOLLOWS:
COMMENCING FROM THE WEST % CORNER OF SAID SECTION 24; THENCE
N01°17'08"W, 1,010.65 FEET ALONG THE WEST LINE OF THE NORTHWEST Y OF SAID
SECTION, THENCE N88°42'32"E, 34.00 FEET TO THE INTERSECTION OF THE EAST
RIGHT-OF-WAY LINE OF .JACKSON STREET AND NORTH RIGHT-OF-WAY LINE OF
ALGOMA BOULEVARD; THENCE S54°36'37"E, 417.74 FEET ALONG THE NORTH RIGHT-
OF-WAY LINE OF ALGOMA BOULEVARD TO THE SOUTHWESTERLY CORNERS OF
BEACH BUILDING CONDOMINIUM AND LOT 15 OF BLOCK G OF LEACH'S MAP OF 1894
AND POINT OF BEGINNING; THENCE N27°08'56"E, 222.48 FEET; THENCE S61°48'46"E,
77.56 FEET; THENCE N28°41'02"E, 28.29 FEET; THENCE S61044'56"E, 8.00 FEET; THENCE
N28°15'04"E, 64.30 FEET TO THE SOUTHWESTERLY CORNER OF LOT 19 OF SAID
BLOCK G; THENCE S59°36'37"E, 98.50 FEET ALONG THE SOUTHERLY LINE OF SAID LOT
19 TO THE SOUTHEASTERLY CORNER OF SAID LOT 19; THENCE S34°24'38"W, 15.83
FEET ALONG THE WESTERLY LINE OF LOT 13 OF SAID BLOCK G; THENCE S580'07'30"E,
55.59 FEET; THENCE S47°12'10"E, 9.91 FEET TO A POINT ON THE NORTHERLY LINE OF
LOT 17 OF SAID BLOCK G; THENCE S59°34'46"E, 5.62 FEET ALONG THE NORTHERLY
LINE OF SAID LOT 17; THENCE S31°18'33"W, 88.20 FEET; THENCE N58°41'27"W, 4.98
FEET; THENCE S31°18'33"W, 10.30 FEET; THENCE S58°41'27"E, 4.99 FEET; THENCE
31018'33"W, 38.85 FEET; THENCE S58°36'28"E, 14.99 FEET; THENCE S32°12'15"W, 182.49
FEET TO THE SOUTHEASTERLY CORNER OF SAID LOT 17, ALSO BEING THE
NORTHERLY RIGHT-OF-WAY LINE OF ALGOMA BOULEVARD; THENCE N54°36'37"W,
245.88 FEET ALONG SAID NORTHERLY RIGHT-OF-WAY LINE OF ALGOMA BOULEVARD
TO THE POINT OF BEGINNING. SAID AREA CONTAINS 73,455 SQUARE FEET OR 1.686
ACRES, MORE OR LESS.
15615909.6
Exhibit B
ProfoiTna City Contribution Calculation
5615909.6
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Exhibit C
Proforma IRR Calculation
15615909.6
...:...:...::.
.....:. .:-:,:..:....;. ......_.�..:.....,........_..:: . .._ eturnananves#ment etrics:::::::::::.:..::::.�:._=<:�°��:.::�:�:�� ���.=�°=��=°:=::�':�� � �-��:';�.::=.:;:_::_�
With TIF Without TIF
Initial Cash Outlay 1,295,450 1,295,450
Historic Tax Credits 998,015 998,015
HTC Present Value 763,482 763,482
Net Effective Cash 531,968 531,968
Net Cash Flow Reversion Total Net Cash Flow Reversion Total
Year 0 -531,968 -531,968 -531,968 -531,968
Year 1 -29,698 -29,698 29,698 -29,698
Year 2 -21,487 -21,487 -36,282 -36,282
Year 3 -17,736 -17,736 -32,806 -32,806
Year -13,905 -13,905 -29,252 -29,252
Year 5 -9,992 -9,992 -25,620 -25,620
Year 6 -5,996 -5,996 -21,907 -21,907
Year 7 -1,915 -1,915 -18,112 -18,1.12
Year 8 2,253 2,253 -14,233 -14,233
Year 9 6,510 6,510 -10,268 .10,268
Year 10 10,856 849,760 860,617 -6,216 646,517 640,301
Yr 11 NOI 186,285 168,914
Terminal Cap Rate 8,55% 8.55%.
Gross Reversion 2,1.79,659 1,976,416
Mortgage Payoff 1,329,899 1,329,899
Net Reversion 849,760 646,517
10yr IRR=> 3.38% 10yr IRR=>
. I