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BUSINESS MAINTENANCE AND CONTINUED PERFORMANCE AGREEMENTBUSINESS MAINTENANCE & CONTINUED PERFORMANCE AGREEMENT FOR USE BY APPLICANTS APPLYING IN THE rwater Mail to: City of Clearwater Attn: Economic Development Director 112 S. Osceola Ave Clearwater, FL 33756 BUSINESS MAINTENANCE AND CONTINUED PERFORMANCE AGREEMENT THIS AGREEMENT is entered into this :21(/ day of MAI 2014 by and between City of Clearwater, Florida, a municipal corporation of the State of Florida (the "City ") whose mailing address is 112 South Osceola Avenue, Clearwater, Florida 33756 and Skye Lane Properties, LLC, a Florida Limited Liability Company, and Heritage Property & Casualty Insurance Company, (together, "the Company "), whose mailing address is 700 Central Avenue, Suite 500, St. Petersburg, Florida 33701. WITNESSETH WHEREAS, Article VII, Section 3, of the Constitution of the State of Florida and Section 196.1995, Florida Statutes, provide that the City may grant Economic Development Ad Valorem Tax Exemptions (EDAVTE) to New Businesses and Expansions of Existing Businesses, as defined in Section 196.012 (15)(16), Florida Statutes, by ordinance provided that the electors of the City, voting on the question in a referendum, authorize the City to adopt such ordinances; and WHEREAS, On November 6, 2012, City of Clearwater voters approved the referendum, authorizing the City Council of the City of Clearwater (the "Council ") to grant EDAVTEs pursuant to state law; and WHEREAS, the Council recognizes that it is a function of local government to promote economic development within its jurisdiction by providing financial incentives to encourage new businesses to relocate within its jurisdiction and existing businesses to expand creating employment opportunities and the utilization of local resources that will benefit the entire community; and WHEREAS, Chapter 29, Article VII of the Code of Ordinances City of Clearwater (the "Code ") sets forth the process and procedures for implementing the EDAVTE program; and, WHEREAS, Pursuant to Section 29.204 of the Code, the Company submitted an application to the City requesting an EDAVTE for the qualifying improvements to real property and qualifying tangible personal property specified in its application, commencing with Tax Year 2014 ( "the Company Application "); and, WHEREAS, on January 16, 2014 , in recognition of the economic stimulus the Company would provide to the community if it expanded its business, invested approximately six million one hundred thousand dollars ($6,100,000.00), and relocated 54 jobs to the facility from St. Petersburg, Florida, and created an additional 11 new jobs in the City paying an average annual wage of no less than eighty -seven thousand ($87,000) the Council authorized an EDAVTE of the assessed value of the net increase in qualifying improvements to real property and qualifying tangible personal property as set forth in the Company Application, to facilitate the expansion of its business ( "Skye Lane Properties, LLC, and Heritage Property & Casualty Insurance Company Ad Valorem Tax Exemption ") of seventy -five percent (75 %) for a period of five (5) years commencing with Tax Year 2014 through Tax Year 2018 and fifty percent (50 %) for a period of five (5) years commencing with Tax Year 2019 through Tax Year 2023; and, WHEREAS, Pursuant to Ordinance No. 8536 -14, the Company agrees to satisfy the continued performance conditions set forth in the Company Application. NOW THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, hereby acknowledged by the parties, the Company and City agree as follows: 1. Incorporation. The recitals set forth above are incorporated herein in their entirety. 2. Ad Valorem Tax Exemption. Pursuant to Ordinance No. 8536 -14, the City shall provide an EDAVTE of the assessed value of the net increase in qualifying improvements to real property and qualifying tangible personal property as set forth in the Company Application, to facilitate the expansion of its business ( "Skye Lane Properties, LLC, and Heritage Property & Casualty Insurance Company Ad Valorem Tax Exemption ") of seventy -five percent (75 %) for a period of five (5) years commencing with Tax Year 2014 through Tax Year 2018 and fifty percent (50 %) for a period of five (5) years commencing with Tax Year 2019 through Tax Year 2023. 3. Business Maintenance and Continued Performance Conditions Requirement. Pursuant to Ordinance No. 8536 -14, the Company, shall enter into an agreement with the City satisfying the Business Maintenance and Continued Performance Conditions as set forth in the Company Application as follows: a. Commencement of Operations: The Company will establish its corporate headquarters and operations center at 2600/2650 McCormick Drive, Clearwater, Florida 33759. They are currently located at 700 Central Avenue, Suite 500, St. Petersburg, Florida 33701. The Company, as of November 25, 2013, has 54 full time employees at its current St. Petersburg, Florida, facility. These employees will relocate to the McCormick Drive facility. b. Annual Report: i. Evidence of satisfaction of information in the Company Application dated November 25, 2013, and the Attachment Form DR -418 must be provided in the Annual Report to the Economic Development and Housing Department on or before March 1St of each year for which the Exemption is granted. The Company shall also timely comply with all filings required pursuant to F.S. s.196.011. c. Real Property Project Description: i. The Company purchased the real property at 2600/2650 McCormick Drive, Clearwater, Florida, April 02, 2013 for nine million two hundred thousand dollars ($9,200,000.00). New construction to the real property at 2600/2650 McCormick Drive, Clearwater, Florida will consist of a tri-level parking facility plus interior renovations and other parking area renovations. d. Tangible Personal Property and Real Property Capital Investment: i. The Company shall purchase furniture, fixtures and equipment for approximately two hundred thousand dollars ($200,000.00) ii. Real property capital investment in the amount of approximately four million dollars ($4,000,000.00) will be to construct a new tri- level parking facility. iii. Interior renovations and parking area renovations to the real property will also be made for a capital investment of approximately one million nine hundred thousand dollars ($1,900,000.00). e. New Jobs: i. The Company, will create eleven (11) additional jobs over a 1 -year period. It is estimated that 75% of the employees will reside in Pinellas County and 5% in the City limits. f. Wages: i. The Company represents that the average annual wage of all new jobs shall together be no less than $87,000. g. Sales Factor /Current Sales: i. The Company represents that for 2013 the sales inside the Tampa - St. Petersburg - Clearwater, FL Metropolitan Statistical Area (MSA) was $36.3 million with a 27% sales factor and the sales outside the MSA was $96.6 million with a sales factor of 73 %. h. Other Council Considerations for Exemption Determination: i. The Company shall use local suppliers, where available; ii. The Company shall make every attempt to hire employees located within City of Clearwater; iii. The Company shall continue to be actively involved in the community. iv. The Company shall continue to strive to maintain a paperless workflow in an industry that typically generates and consumes vast paper resources. 4. Ordinance No. 8536 -14 Requirements. The Company shall abide by all other requirements as defined in Ordinance No. 8536 -14. 5. Council Revocation. a. If the Company fails to satisfy the Business Maintenance and Continued Performance Conditions set forth in Section 3 of this Agreement, excluding 3(g) and 3(h), the Council may, upon 30 days written notice to the Company adopt an ordinance revoking the ad valorem tax exemption or take such other action with respect to the Skye Lane Properties, LLC, Ad Valorem Exemption it deems appropriate. b. Upon Revocation, the Council shall immediately notify the Pinellas County Property Appraiser; c. If it is determined that for any year within the Exemption Period, the Company was not entitled to receive such Exemption, the Company shall be subject to the taxes exempted as a result of such failure plus annual interest at the maximum rate allowed by law; d. Nothing herein shall prohibit the Company from reapplying for an ad valorem tax exemption pursuant to State law. 6. Assignment. Except as hereinafter provided, neither this Agreement nor any rights, privileges, or claims created by this Agreement may be transferred by the Company without the prior written approval of the City, which approval will not be unreasonably withheld, conditioned or delayed; provided that the Company may assign this Agreement to any affiliate that assumes in writing all of the Company's obligations under this Agreement and provides written notice of the assignment to the City within thirty (30) days after such assignment. Any attempted assignment in breach of this Agreement shall be void. 7. Controlling Law. This Agreement is entered into pursuant to the laws of the State of Florida, and shall be construed and enforced thereunder. In the event of litigation for any alleged breach of this Agreement, exclusive jurisdiction and venue for such litigation shall be in the Circuit Court of the Sixth Judicial District, in and for City of Clearwater, Florida, or the United States District Court for the Middle District of Florida, Tampa Division. In the event of any litigation concerning this Agreement, the parties waive all rights to a jury trial. 8. Notice. Any notices required under this Agreement shall be in writing and be addressed to the parties as shown below. Notices shall be delivered by certified or registered first class mail or by commercial courier service, and shall be deemed to have been given or made as of the date received. City of Clearwater Economic Development & Housing Dept Attn: Geraldine Lopez, Director 112 S. Osceola Ave Clearwater, FL 33756 727 -562 -4023 or 727 -562 -4031 Skye Lane Properties, LLC and Heritage Property & Casualty Insurance Company Attn: Bruce Lucas, Board Chairman & CIO 2600 McCormick Drive Clearwater, FL 33759 727 - 362 -7261 9. Force Majeure. Notwithstanding anything contained in the Act or this Agreement to the contrary, and subject to the terms of this Section, the Company failure to perform its obligations under this Agreement, other than with respect to the payment of money or the giving of any notice required hereunder, shall not be a default, and no disqualification shall occur as a result thereof, if any such failure or delay is due in whole in part to acts of God; acts of public enemy; war; riot; sabotage; blockage; embargo; failure or inability to secure materials, supplies or labor through ordinary sources by reason of shortages or priority; labor strikes, lockouts or other labor or industrial disturbance (whether or not on the part of agents or employees of either party hereto engaged in renovation or construction at the Facility); civil disturbance; terrorist act; fire, flood, windstorm, hurricane, earthquake or other casualty; any law, order, regulation or other action of any governing authority; any action, inaction, order, ruling, moratorium, regulation, statute, condition or other decision of any governmental agency having jurisdiction over any portion of the Facility, over the renovation or construction anticipated to occur thereon or over any uses thereof, or by delays in inspections or in issuing approvals by private parties or permits by governmental agencies; discovery of hazardous or toxic materials; failure of the Internet; failure of power, telecommunication, data connectivity or other services to be delivered to the Facility by any third party including any local utility provider; delays caused by any dispute resolution process; or any cause whatsoever beyond the reasonable control (excluding financial inability) of the party whose performance is required hereunder, or any of its contractors or other representatives, whether or not similar to any of the causes hereinabove stated. 10. Conflicting Law; Severability. If a Conflicting Law is enacted after the Effective Date, then the City and the Company, shall meet and confer in good faith for a period of no less than thirty (30) and no more than ninety (90) days to seek to effectuate an amendment to this Agreement providing the City and the Company, with the rights and remedies intended to be provided herein. Nothing herein shall preclude either the City or the Company, from challenging the validity of any Conflicting Law. Each provision in this Agreement is severable. If any such provision is determined to be invalid or illegal, the validity and enforceability of the remainder of this Agreement shall be unaffected. If the Economic Development Ad Valorem Tax Exemption, or any portion thereof, is deemed by a court of competent jurisdiction to be ultra vices or not authorized by the laws or Constitution of the State of Florida, then the City shall use reasonable efforts to provide equivalent incentives to the Company,. as allowed by law. 11. Term. The term of this Agreement shall commence on the date of last signatory hereto (the "Effective Date ") and, unless sooner terminated, shall continue in force through December 31, 2023. 12. Amendments. This Agreement shall not be changed except by written instrument signed by all the parties. 13. Binding Effect and Effectiveness; Representations and Warranties. a. Subject to the specific provisions of this Agreement, this Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties and their respective successors and assigns, notwithstanding changes in corporate or other governance. b. The Company, represents and warrants to the City that as of the date hereof and throughout the term of this Agreement: i. The Company, is a for profit limited liability company, duly organized under the laws of the State of Florida, maintains a place of business within the State of Florida, and is validly existing and is doing business in the State of Florida as the Company,. ii. The Company, has the power and authority to own its properties and assets and to carry on its business as now being conducted and has the power and authority to execute and perform this Agreement; iii. This Agreement (a) is the lawful, valid and binding agreement of the Company, in its limited liability name enforceable against the Company, in accordance with its terms; (b) does not violate any order of any court or other agency of government binding on the Company„ the charter documents of the Company, or any provision of any indenture, agreement or other instrument to which the Company, is a party; and (c) does not conflict with, result in a breach of, or constitute an event of default, or an event which, with notice or lapse of time, or both, would constitute an event of default, under any material indenture, agreement or other instrument to which the Company, in its limited liability company name is a party; iv. The Company, has not received written notice of any action having been filed against the Company, that challenges the validity of this Agreement or the Company's, right and power to enter into and perform this Agreement; and 14. Effective Date. This Agreement shall be effective on the date of the last signatory hereto. IN WITNESS WHEREOF, the City and Skye Lane Properties, LLC, and Heritage Property & Casualty Insurance Company have executed the Agreement as of the date first above written. SKYE LANE PROPERTIES, LLC, AND HERITAGE PROPERTY & CASUALTY INSURANCE COMPANY By: Bruce Lucas Title: Board Chairman & Chief Investment Officer 1 / 21 Date: CITY OF CLEARWATER, FLORIDA By: Approved as to form: Attest: Pame a K Akin City Attorney William B. Horne II City Manager ut u, L Rosemarie Call City Clerk