03/22/11 Special - Laserfiche WebLink

Home

iv. Upon certificate of occupancy for the office building, the final twenty percent (20 %) becomes due in the amount of $20,000. 4. Large Projects — In calculating the Incentive Compensation on developments with a total Development Capital Cost greater than $30 million in a single transaction, the following equation shall be used: a. The Incentive Compensation shall be two percent (2 %) of the total Development Capital Cost up to $30 million (standard agreement); b. Then, one percent (1.0 %) for Development Capital Costs from $30 million to $100 million; c. Then, one half percent (0.5 %) for Development Capital Costs in excess of $100 million -$150 million; d. Then, one quarter per cent (0.25 %)for Development Capital Costs in excess of $150 million. e. Example for a. d. above: An agreement is signed for a development with an estimated total Development Capital Cost of $180,000,000. The Incentive Compensation shall be calculated as follows: i. 2.0% of $30m = $600,000 ii. 1.0% of $70m = $700,000 iii. 0.5% of $50m = $250,000 iv. 0.25% of $30m = $75,000 v. Total Compensation = $1,625,000 5. Phased Projects — In calculating the Incentive Compensation on projects where occupancy is anticipated to be phased over a period greater than 24 months from the spring of the year following closing of the transaction (phased start), a discount to the Incentive Compensation will be applied as a means to recognize the delay in property tax payments realized by the HRA. a. For each 12 month period the project, or portion of the project, is anticipated to be phased beyond 24 months, the Incentive Compensation for that portion of the project shall be discounted by ten percent (10 %) of the anticipated fully assessed tax revenues for one year. b. Example: A sale occurs for an apartment project consisting of six buildings. Two are to be constructed immediately; two are anticipated to begin the following year, and the last two the year after. Each phase is roughly $20m in value. Each phase has an estimated tax liability of $300,000 annually. i. Phase 1 Incentive Compensation shall be the full two percent (2 %) of the $20m or $400,000. ii. Phase 2 commencing later than 24 months after the spring following closing shall be the full Incentive Compensation ($400,000) discounted $40,000 or $360,000. iii. Phase 3 commencing later than 36 months after the spring following closing shall be the full Incentive Compensation ($400,000) discounted $80,000 or $320,000 iv. The total Incentive Compensation for the example phased project would be $1,080,000. 6. Incentive Compensation shall be due on any development deals located within the Project, that close or break ground after April 1, 2010. In the event of the termination of this agreement, regardless of cause, any incentive 1 Ramsey -2011 DM Agreement 1 9 2010 9