HomeMy WebLinkAboutOrd.5750.04-15-2024 BILL NO. 24-39 ORDINANCE NO. 5 /50
AN ORDINANCE APPROVING A FIRST AMENDMENT TO
REDEVELOPMENT AGREEMENT BETWEEN THE CITY OF CAPE
GIRARDEAU AND TENMILE HOLDINGS,LLC.
WHEREAS, the City of Cape Girardeau and Tenmile Holdings, LLC (the "Developer") entered
into a Redevelopment Agreement dated as of May 2, 2022 (the "Original Agreement") relating to the
redevelopment of the historic Esquire Theater building into office suites with an additional retail space or
café at the building's Broadway entrance; and
WHEREAS, the Original Agreement required completion of the Redevelopment Project by
June 30, 2023, for the Developer to be reimbursed from tax increment financing revenues for a portion of
its redevelopment costs; and
WHEREAS, the Developer has requested that the Original Agreement be amended to provide
additional time to complete the Redevelopment Project;
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF CAPE
GIRARDEAU,MISSOURI,AS FOLLOWS:
Section 1. The City Council hereby approves the First Amendment to Redevelopment
Agreement in substantially the form of Exhibit A attached hereto (the "First Amendment"). The City
Manager is hereby authorized to execute the First Amendment on behalf of the City. The City Clerk or
Deputy City Clerk is hereby authorized to attest to the First Amendment and to affix the seal of the City
thereto.
Section 2. The officers,agents and employees of the City are hereby authorized to execute all
documents and take such steps as they deem necessary and advisable to carry out and perform the purpose
of this Ordinance.
Section 3. The sections of this Ordinance shall be severable. If any section of this Ordinance
is found by a court of competent jurisdiction to be invalid,the remaining sections shall remain valid,unless
the court finds that: (a)the valid sections are so essential to and inseparably connected with and dependent
upon the void section that it cannot be presumed that the City Council has or would have enacted the valid
sections without the void one; and(b)the valid sections, standing alone, are incomplete and are incapable
of being executed in accordance with the legislative intent.
Section 4. This Ordinance shall take effect and be in full force 10 days after its passage by
the City Council.
PASSED AND APPROVED THIS t5 DAY OF_Ap ,2024.
ttacc Kinder,Mayor
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Clerkkit
FIRST AMENDMENT TO REDEVELOPMENT AGREEMENT
This FIRST AMENDMENT TO REDEVELOPMENT AGREEMENT (this "First
Amendment")is made and entered into as of April 17 ,2024,by and between the CITY OF CAPE
GIRARDEAU, MISSOURI; a home-rule city organized and existing under the laws of the State of
Missouri (the "City"), and TENMILE HOLDINGS, LLC, a limited liability company organized and
existing under the laws of the State of Missouri(the"Developer").
RECITALS:
1. The City and the Developer entered into a Redevelopment Agreement dated as of May 2,
2022(the"Original Agreement")relating to the redevelopment of the historic Esquire Theater building(the
"Building") into office suites with an additional retail space or café at the building's Broadway entrance
(the"Redevelopment Project").
2. The Original Agreement required completion of the Redevelopment Project by June 30,
2023, for the Developer to be reimbursed from tax increment financing revenues for a portion of its
redevelopment costs. The Developer has requested that the Original Agreement be amended to provide
additional time to complete the Redevelopment Project.
3. Pursuant to Ordinance No.,5'i50,adopted on ri 15 ,2024,the City Council has
authorized the City to enter into this First Amendment.
AGREEMENT
NOW,THEREFORE,in consideration of the premises and mutual promises contained herein and
other good and valuable consideration, the adequacy and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
1. Development. The first sentence of Section 1(a)of the Original Agreement is amended to
read as follows: "The Developer hereby agrees to complete the Redevelopment Project at its own expense
no later than January 1,2025."
2. Public Participation.
(a) Reasonable Rate of Return. The purpose of affording public assistance to the
Redevelopment Project is to accomplish the stated public purposes and not to subsidize an otherwise
economically-viable development project.While the City Council has determined that-the Redevelopment
Project would not be undertaken but for the public assistance being provided,the parties recognize that the
ongoing profitability of the Redevelopment Project to the Developer is based upon projections that may or
may not be fulfilled. To ensure that the public assistance being provided does not subsidize an unreasonable
level of earnings for the Developer with respect to the Redevelopment Project, the parties agree that a
reasonable level of return for the Redevelopment Project is a leveraged rate of return of 12.00% (the
"Maximum Rate of Return").
(b) Rate of Return Calculation. Upon the sale of substantially all of the Building before
December 31, 2034, the Developer shall provide a leveraged rate of return calculation (prepared in
accordance with industry standards as reasonably determined by the City's Finance' Director) (the
"Leveraged Rate of Return"). If the Leveraged Rate of Return exceeds the Maximum Rate of Return,then
the City and the Developer will equally divide the portion of sale proceeds that would cause the Leveraged
Rate of Return to exceed the Maximum Rate of Return. Subject to appropriation by the City Council,the
City wiII divide its share of any revenues received pursuant to this paragraph among the taxing districts
whose boundaries encompass the Redevelopment Area in proportion to their then-current real property tax
levies. If the sale of substantially all of the Building occurs on or after December 31, 2034, no public
participation shall be due and no payments from the sale shall be owed by the Developer to the City.
The Developer's calculation of the Leveraged Rate of Return shall include the Developer's signed
certification regarding the accuracy of the calculation. If the City elects,pursuant to subparagraph(c) of
this Section,to audit the Developer's submission,the Developer will provide,in a timely manner,detailed
financial and other information required for the selected firm or consultant to complete the audit.
(c) Audits. The City may,within 30 days after the Developer's submission of the Leveraged
Rate of Return calculation,request an audit of the calculation by an independent firm or consultant selected
by the City in its sole discretion. The Developer shall pay one-half of the costs of such firm or consultant.
The firm or consultant shall inform the City and the Developer of any discrepancy identified by the audit
in writing and provide a detailed explanation of the discrepancy. If the Developer does not provide a written
objection to the audit findings within 30 days,then the audit findings shall be deemed final and the results
of the audit shall be used in calculating or correcting the Leveraged Rate of Return and any payments owed
to the City. If the Developer provides a written objection to the audit findings within 30 days,the Developer
may request a new audit by a mutually-agreeable independent firm or consultant, the costs of which shall
be paid by the Developer. Absent manifest error,the findings of the additional audit shall be deemed final
and shall be relied upon in calculating or correcting the Leveraged Rate of Return and any payments owed
to the City.
3. City Fees. The Developer shall promptly pay any fees and expenses incurred by the City
in connection with the preparation of this First Amendment.
4. Ratification and Approval. Except as amended hereby, the Original Agreement is and
shall remain in full force and effect in accordance with the provisions thereof.
5. Counterparts. This First Amendment may be executed in multiple counterparts,each of
which shall constitute one and the same instrument.
6. Conflicting Provisions. In the event of any inconsistency between the terms and
provisions of the Original Agreement and this First Amendment, the terms and provisions of this First
Amendment shall prevail.
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IN WITNESS WHEREOF,the parties have caused this First Amendment to be executed and the
City has caused its seal to be affixed hereto and attested as of the date first written above.
CITY OF CAPE GIRARDEAU,MISSOURI
01 , 6%.,
s� ham .. ; By: �� ��
��}} `ti Name: KennetasTrn3�-�''
fr- . ®' Title: City Manager
(SEAL` ' 'r S
ATTEST: ,`••�^ ^'
By: ii,,,, .....4,4
Name: •Oa $race/ �Qctiew-
Title: City Clerk
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TENMILE HOLDINGS,LLC
By:
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Name: Benjamin F.Traxel
Title: Managing Member
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