The following is an executive summary of the proposed development agreement between Boca Grande Capital, LLC, its affiliate Ripon Renew, Inc. (“Developer”), and the City of Ripon (“City”), being negotiated in connection with Developer’s planned Ripon Inn & Spa and other projects.
City Assistance
• City’s TIF assistance to Developer will be provided in the form of a single advance, in the amount of $8,620,000, payable into escrow on the effective date of the agreement, a portion of which will be directly repayable by Developer to City.
• The grant portion of the advance will be allocated as follows:
Ripon Inn & Spa Project (B-1): $5,500,000
• The repayable portion of the advance will be allocated as follows:
Other Projects (B-2 through B-10): $3,120,000
Developer Guarantees and Security
• Developer will guarantee a certain dollar amount of investment in the Ripon Inn & Spa project. Developer also will guarantee a specified increase in assessed value for each property included within the other projects.
• Developer also will provide a “key-man” life insurance policy on the life of Frank Cumberbatch for the first ten years of the project to cover one-half of the City's total investment, and a construction completion bond to ensure the completion of the Ripon Inn & Spa and insure City’s investment in that project.
City Assistance
• City’s TIF assistance to Developer will be provided in the form of a single advance, in the amount of $8,620,000, payable into escrow on the effective date of the agreement, a portion of which will be directly repayable by Developer to City.
• The grant portion of the advance will be allocated as follows:
Ripon Inn & Spa Project (B-1): $5,500,000
• The repayable portion of the advance will be allocated as follows:
Other Projects (B-2 through B-10): $3,120,000
Developer Guarantees and Security
• Developer will guarantee a certain dollar amount of investment in the Ripon Inn & Spa project. Developer also will guarantee a specified increase in assessed value for each property included within the other projects.
• Developer also will provide a “key-man” life insurance policy on the life of Frank Cumberbatch for the first ten years of the project to cover one-half of the City's total investment, and a construction completion bond to ensure the completion of the Ripon Inn & Spa and insure City’s investment in that project.
• James P. Connelly will provide additional security in the form of a personal guarantee of Developer’s repayment and assessed value guarantee obligations for the repayable portion of the project (Projects B2-B10) for the years 2012-2021. At the end of that period, the two sides will bilaterally discuss and negotiate new terms of a guarantee if conditions at that time warrant.
• All of Developer’s obligations will be further secured by subordinate mortgages on the properties included within the projects.
Other Terms
• The amounts advanced will be held by an escrow agent, and City will obtain the benefit of any interest accruing on the balance of the advance held in the escrow account.
• Disbursements of funds to Developer will only be made upon Developer providing to City evidence satisfactory to City that the funds have been or will be spent properly.
• Developer will commence all of the projects it undertakes within 40 months and will complete all such projects within 50 months.
• All of Developer’s obligations will be further secured by subordinate mortgages on the properties included within the projects.
Other Terms
• The amounts advanced will be held by an escrow agent, and City will obtain the benefit of any interest accruing on the balance of the advance held in the escrow account.
• Disbursements of funds to Developer will only be made upon Developer providing to City evidence satisfactory to City that the funds have been or will be spent properly.
• Developer will commence all of the projects it undertakes within 40 months and will complete all such projects within 50 months.
