REDEVELOPMENT AGREEMENT

Exhibit 10.1

 

 

REDEVELOPMENT AGREEMENT

 

FOR THE

 

FORSYTH/HANLEY REDEVELOPMENT AREA

 

BETWEEN THE

 

CITY OF CLAYTON, MISSOURI

 

AND

 

CENTENE PLAZA REDEVELOPMENT CORPORATION

 

Dated: December 30, 2005

 

TABLE OF CONTENTS

 

 

(i)

 

Exhibit A - Site Plan

Exhibit B - Legal Description of the Redevelopment Area

Exhibit C - Redevelopment Plan

Exhibit D - Form of Certificate of Substantial Completion

Exhibit E - Transferee Agreement

Exhibit F - Special Development Conditions

 

(ii)

REDEVELOPMENT AGREEMENT

 

THIS REDEVELOPMENT AGREEMENT is made and entered into effective as of the 30th day of December, 2005, by and between the CITY OF CLAYTON, MISSOURI (the “City”), a Missouri municipal corporation, and CENTENE PLAZA REDEVELOPMENT CORPORATION (the “Corporation”), a Missouri urban redevelopment corporation, for the implementation of the Forsyth/Hanley Redevelopment Plan described herein. Capitalized terms not otherwise defined herein are defined in Article 1 of this Agreement.

 

RECITALS

 

1.

Chapter 353 of the Revised Statutes of Missouri, known as The Urban Redevelopment Corporations Law (the “URC Law”), authorizes the City to approve, by ordinance, redevelopment plans that allow for the redevelopment of blighted areas within the City and the granting of tax abatements and exemptions to encourage such redevelopment.

 

2.

The Board of Aldermen of the City, in recognition that the Redevelopment Area has not experienced meaningful new private sector investment in recent years and that the Redevelopment Area is blighted within the meaning of that term in the URC Law, solicited proposals on April 22, 2005, to facilitate redevelopment of such area. On May 27, 2005, Centene Corporation (the “Developer”) submitted a proposal (the “Proposal”) in response thereto.

 

3.

The Proposal calls for three phases of redevelopment: Phase I consists of the Developer’s acquisition and renovation of the City-owned parking garage and construction of a pedestrian bridge connecting the garage to the Developer’s current office building; Phase II consists of construction of a new 16-story office building to house the Developer’s headquarters and to provide additional office space for expansion and lease; and Phase III consists of a new office building for future expansion and lease, retail space and a parking structure. The Proposal requested that the City provide for partial tax abatement in order to make the proposed development economically feasible. Subsequent to the submission of the Proposal, the Developer agreed not to seek tax abatement on Phase I in return for other redevelopment consideration; consequently, the Redevelopment Area will consist of only those portions of property relating to Phase II and Phase III, as described in the Proposal.

 

4.

The Board of Aldermen has: (a) enacted into law Resolution No. 05-31 conveying in fee the City-owned parking garage at 7733 Carondelet Avenue, (b) enacted into law Ordinance No. 5911, finding the Redevelopment Area to be blighted within the meaning of Section 353.020(2) of the URC Law, approving the Redevelopment Plan, and authorizing and directing the City Manager to enter into this Redevelopment Agreement, and (c) determined that the clearance and redevelopment provided for in the Redevelopment Plan are necessary for the public convenience and necessity and that the approval of the Redevelopment Plan and the activities related thereto are necessary for the preservation of the public health, safety and welfare.

5.

The Corporation intends to (a) construct or cause to be constructed the Redevelopment Project within the Redevelopment Area in one or more phases, (b) acquire property within the Redevelopment Area for the purpose of receiving tax abatement under the URC Law in one or more phases, and (c) transfer such property to the Developer for the purpose of operating a commercial office and retail development in one or more phases.

 

6.

The Corporation is in good standing in the State of Missouri and has represented that it has the necessary expertise, skill and ability to carry out the commitments contained in this Agreement.

 

NOW, THEREFORE , for and in consideration of the foregoing Recitals (which are incorporated into this Agreement as an integral part hereof) and the promises, covenants and agreements contained herein, the City and the Corporation do hereby agree as follows:

 

ARTICLE 1

INCORPORATED ITEMS; DEFINITIONS; EXHIBITS

 

1.01 Items Incorporated into this Agreement; Coordination with Redevelopment Plan. The provisions of: (a) the URC Law, (b) the Redevelopment Plan and (c) the Proposal are hereby incorporated herein by this reference thereto and made in whole a part of this Agreement. To the extent that any of the provisions of this Agreement conflict with any of the provisions of the Redevelopment Plan, the provisions of this Agreement shall control and govern.

 

1.02 Definitions. In addition to the terms defined elsewhere in this Agreement, the following capitalized words and terms shall have the following meanings:

 

“Affiliate” means any entity that is controlled by the Developer or a wholly-owned subsidiary of the Developer.

 

“Agreement” means this Redevelopment Agreement.

 

“Authorizing Ordinance” means Ordinance No. 5911 adopted by the City on December 13, 2005, finding the Redevelopment Area to be blighted within the meaning of the URC Law, approving the Redevelopment Plan and authorizing this Agreement.

 

“Building Permit” means any and all demolition, grading and/or building permits required by the City’s Code of Ordinances to construct all or any portion of the Redevelopment Project.

 

“Business Assistance Policy” means the relocation policy of the City for the Redevelopment Area adopted on December 13, 2005, pursuant to Ordinance No. 5910.

 

“Certificate of Substantial Completion” means the Certificate of Substantial Completion attached hereto as Exhibit D , to be delivered by the Corporation upon the completion of the Redevelopment Project and each phase thereof, and upon approval thereof accepted by the City in accordance with Section 2.08 of this Agreement.

 

“Developer” means Centene Corporation, a Delaware corporation, and its permitted successors and assigns.

 

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“Effective Date” means the effective date of this Agreement, which shall be the date written above on page 1.

 

“Phase I” means Phase I of the Developer’s undertakings, as described in the Proposal (but which is not part of the Redevelopment Project and which is not included in the Redevelopment Area).

 

“Phase II” means Phase II of the Redevelopment Project, as described in the Redevelopment Plan.

 

“Phase III” means Phase III of the Redevelopment Project, as described in the Redevelopment Plan.

 

“Phase III (Forsyth Retail Properties)” means the portion of Phase III of the Redevelopment Project which consists of the redevelopment of the “Forsyth Retail Properties,” as described in the Redevelopment Plan.

 

“Phase III (Tower B)” means the portion of Phase III of the Redevelopment Project which consists of the redevelopment of the “Plaza B Property,” as described in the Redevelopment Plan.

 

“Proposal” means the proposal submitted by the Developer on May 27, 2005, relating to the development of the Redevelopment Area.

 

“Redevelopment Area” means all of the real property located within and comprising the Redevelopment Area as shown on the Site Plan and as more particularly described on Exhibit B attached hereto, upon which the Redevelopment Project will be constructed pursuant to this Agreement.

 

“Redevelopment Plan” means the Development Plan for Hanley/Forsyth Redevelopment Area, approved by the City pursuant to the Authorizing Ordinance, a copy of which Redevelopment Plan is attached hereto as Exhibit C .

 

“Redevelopment Project” means the project to be constructed by the Corporation in the Redevelopment Area, which collectively encompasses “Phase II” and “Phase III” as described in the Proposal, the Redevelopment Plan and the Site Plan.

 

“Site Plan” means the preliminary site plan depicting the Redevelopment Project attached hereto as Exhibit A , as the same may be changed or amended in accordance with this Agreement.

 

“URC Law” means The Urban Redevelopment Corporations Law, Chapter 353 of the Revised Statutes of Missouri, as amended.

 

1.03 Exhibits. The following exhibits are attached to and incorporated into this Agreement:

 

 

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ARTICLE 2

REDEVELOPMENT PROJECT

 

2.01 Redevelopment Project. The Corporation shall, in order to eliminate the conditions that have caused the Redevelopment Area to become “blighted” within the meaning of the URC Law, but subject to the terms and conditions of this Agreement, (a) acquire all property within the Redevelopment Area in one or more phases and (b) develop and construct the Redevelopment Project in one or more phases in accordance with the Site Plan, the Redevelopment Plan and all applicable federal, state and local laws, rules, regulations and ordinances.

 

2.02 Acquisition by Negotiation.

 

(a) Reasonable Efforts to Acquire by Negotiation. The Corporation represents and warrants that, with respect to any property it seeks to acquire within the Redevelopment Area, the Corporation will make reasonable efforts to acquire the same by negotiated purchase within the time specified in Section 2.06 . With respect to property in the Redevelopment Area that is acquired by negotiated sale before the commencement of a jurisdictional hearing as contemplated in Section 2.03 of this Agreement, the Corporation agrees to pay all of the seller’s costs and expenses (to the extent deemed reasonable by the City Manager) associated with the sale of such property, but not to exceed 5% of the purchase price of the property being acquired.

 

(b) Requirements for Purchase Agreement. Without limiting the generality of the foregoing subdivision (a), within 60 days after the execution of this Agreement, the Corporation shall offer to owners of parcels an Purchase Agreement (the “Purchase Agreement” ) which shall include the following terms:

 

(1) A purchase price equal to at least 105% of the appraised value of the parcel (which shall be exclusive of any relocation benefits to which the owner is entitled under state law), as evidenced by an appraisal with respect to such parcel performed subsequent to August 1, 2005, by an independent third-party appraiser licensed in the State of Missouri who is reasonably acceptable to the City. The City pre-approves the use of Mueller & Neff Real Estate Appraisers & Consultants, Inc. as the Corporation’s appraiser. The appraisal shall be obtained at the Corporation’s sole cost and expense. Prior to the delivery of the Purchase Agreement to an owner, the Corporation shall provide a copy to the City Attorney who shall have one week either to approve the form and substance of the appraisal (i.e., in a customary form and of a professional caliber in accordance with other appraisals prepared by certified appraisers) or to provide objections thereto to the Corporation.

 

(2) Unless waived by the owner, the Corporation must provide at least thirty (30) days’ notice for closing on the property. If the Corporation terminates its obligation to acquire the property once such notice is given (unless in the City’s reasonable opinion there is due cause for such termination), all redevelopment rights granted hereunder, including the rights of eminent domain and tax abatement, shall expire and terminate.

 

(3) Unless waived by the owner, the owner (and any tenant of the owner) will have 150 days from closing on the parcel to vacate the property.

 

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(c) Other Information to be Provided. At the time the Purchase Agreement is submitted to a Property owner, the Corporation shall:

 

(1) Advise the owner in writing of the relocation benefits to which the owner would be entitled under this Agreement, and (if applicable) advise the owner in writing that the proposed purchase price includes an express waiver of such relocation benefits;

 

(2) Advise the owner in writing of the time period for acceptance of the Purchase Agreement (the “Acceptance Deadline” ), which shall not be less than 45 days; and

 

(3) Provide a copy of the Purchase Agreement to the City.

 

(d) Mediation Process.

 

(1) Before the initiation of condemnation proceedings with respect to any parcel of the property, an owner is entitled to participate in a mediation process by which an independent third party can facilitate the resolution of any differences between the owner and the Corporation. To initiate the mediation process, the owner must notify the City and the Corporation, on or before the Acceptance Deadline, that the owner does not intend to accept the offer made by the Corporation under the Purchase Agreement, and that the owner desires to participate in mediation.

 

(2) Within 7 days after the owner has given notice to the Corporation and to the City of its desire to participate in mediation, the Corporation and the owner (or their attorneys) shall select a mediator. The mediator shall be selected from a list of five mediators provided by United States Arbitration & Mediation Midwest Inc. If the parties cannot agree on a mediator on the list, then each party shall eliminate two mediators and the remaining person shall be the designated mediator. The mediation shall be scheduled within 30 days of the mediator’s selection.

 

(3) Within one week after the mediator’s selection, the owner must submit to the Corporation a counteroffer to the offer made by the Corporation under the Purchase Agreement. Failure to provide a counteroffer shall be deemed a waiver of the owner’s right to mediation. The mediation shall not exceed one 8-hour session. The Corporation shall pay for the mediator’s costs and expenses for up to 8 hours of mediation.

 

(4) To ensure each party is negotiating in good faith, immediately following the conclusion of any mediation, the mediator shall submit a report to the City Attorney that shall include the last offer made by each party.

 

(5) The Corporation agrees to cooperate in all reasonable respects to facilitate the mediation process; provided, if for any reason the parties are unable to hold or complete the mediation within 45 days after the owner has given notice to the Corporation and to the City of its desire to participate in mediation, or if the mediation effort fails to result in an executed Purchase Agreement, the Corporation can proceed with condemnation as provided in this Agreement.

 

2.03 Acquisition by Condemnation.

 

(a) Covenant to Comply with Statutory Requirements. As a condition to its authorization hereunder to institute any eminent domain proceedings against an owner of all or part of the Redevelopment Area, the Corporation hereby covenants and agrees that it shall first satisfy all jurisdictional prerequisites necessary for the initiation of such eminent domain proceedings, including the requirement to negotiate in good faith.

 

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(b) Conditions Precedent. At least fifteen (15) days prior to the initiation of eminent domain proceedings with respect to any property within the Redevelopment Area that the Corporation fails to acquire by negotiated purchase in accordance with Section 2.02 , the Corporation shall deliver, at the Corporation’s sole cost and expense, the following documentation to the City Attorney:

 

(1) The appraisal prepared in connection with the Purchase Agreement provided pursuant to Section 2.02(b)(1) .

 

(2) Evidence that the purchase price offered to the owner of the property was not less than the greater of (A) 105% of the appraised value of the parcel to be acquired (as determined by the appraiser referenced in Section 2.02(b)(1) ), or (b) 100% of the County Assessor’s valuation of the parcel to be acquired.

 

(3) If the parcel to be acquired includes businesses that are tenants, information regarding the terms of each tenant’s lease and the benefits that each tenant would receive under the Corporation’s most recent proposal to acquire the property.

 

(4) Evidence of the Corporation’s efforts to acquire such parcel(s) (including but not limited to evidence of communications or attempts at communications with the owners of such parcel(s), copies of proposed purchase contracts, offers and counter-offers, if any, tendered to the owners); provided, the City shall retain all such documents submitted to the City in connection with the acquisition of any parcel through eminent domain, as closed records to the extent permitted by law, including but not limited to the provisions of Chapter 610 of the Revised Statutes of Missouri, as amended.

 

(c) Information to be Provided to City. During the condemnation proceedings, the Corporation agrees to consult with the City regarding the prosecution of the litigation. Advice and consultation with the City shall continue throughout such proceedings. The City shall, upon initiation of the condemnation proceedings, designate in writing to the Corporation an individual who is authorized to represent the City in consultations with the Corporation and its counsel. Upon the request of the City’s designee, the Corporation shall provide copies of all pleadings and other documents filed or prepared in conjunction with the prosecution of the condemnation proceedings for the designee’s inspection. The Corporation shall pay all costs incurred by the City in connection with any condemnation action in which the City is named as a third-party defendant.

 

2.04 Business Assistance. The Corporation shall relocate those occupants or businesses displaced from any portion of the Redevelopment Area acquired by the Corporation in accordance with and to the extent required by the Business Assistance Policy, except insofar as otherwise agreed in writing by such displaced occupant or business and approved in writing by the Corporation; it being understood and agreed that any displaced occupant or business may waive his/her/their rights to statutory and other relocation benefits under the Business Assistance Policy or otherwise. The Corporation understands that the Business Assistance Policy prohibits the Corporation from displacing businesses from the Redevelopment Area until the Corporation determines in its good faith discretion that such property is required for construction of the Redevelopment Project. The parties hereby acknowledge that the schedule set forth in Section 2.06(b) hereof for the Corporation’s acquisition of the property in the Redevelopment Area is intended in part to demonstrate the Corporation’s good faith intention to pursue the Redevelopment Project, and the Corporation shall use commercially reasonable efforts to allow tenants and owners currently operating businesses in the Redevelopment Area to continue operations until the Corporation determines in its good faith discretion that vacation of such property is required for construction of the Redevelopment Project.

 

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2.05 Notice of Acquisition.

 

(a) Within thirty (30) days after acquiring any and each parcel of property within the Redevelopment Area, the Corporation shall provide to the City (1) written notice (the “Notice of Acquisition”) to the City confirming that it has acquired title to such property and (2) a copy of the recorded instrument conveying ownership of such property to the Corporation. The Notice of Acquisition shall specify the phase of the Redevelopment Project to which such property relates.

 

(b) The City will not issue a Building Permit for the construction of permanent buildings and structures to the Corporation or an authorized transferee of the Corporation for any structure in the Redevelopment Area associated with the applicable phase until the Corporation submits a Notice of Acquisition to the City concerning the Corporation’s acquisition of all property within the applicable phase.

 

2.06 Deadline for Acquisition of Property and Construction of Redevelopment Project.

 

(a) As of the date hereof, the parties agree that the Developer owns all of the property (excluding rights-of-way and other publicly-owned property) in the Redevelopment Area except those located at 7716, 7720, 7730, 7732 and 7736 Forsyth Blvd. The Corporation will cause notice to be provided to the City within 10 days after either the Corporation or the Developer enters into an agreement to purchase or obtains a judgment giving such party right to title to each of said parcels.

 

(b) Subject to Section 3.01 hereof, if the Corporation fails to acquire all property (excluding rights-of-way and other publicly-owned property) in the Redevelopment Area within eleven (11) months after the Effective Date, all redevelopment rights granted hereunder, including the rights of eminent domain and tax abatement, shall expire and terminate. In addition, upon request of the Corporation the Board of Aldermen will give reasonable consideration to eliminating the requirement to acquire all property within the Redevelopment Area, if the goals of the Agreement (including but not limited to eliminating the blighting conditions within the Redevelopment Area) can be accomplished without acquiring one or more specific structures. The date on which the Corporation has acquired all property (except as otherwise required by the preceding sentence) in the Redevelopment Area is hereinafter referred to as the “Final Acquisition Date.” In addition, within 30 days after any commissioners’ award, the Corporation shall either: (1) notify the City that it is terminating this Agreement; or (2) settle the proceeding; or (3) pay the amount of any commissioners’ award issued in conjunction with any such condemnation proceeding to the Clerk of the Circuit Court.

 

(c) Subject to Section 3.01 hereof, if the Corporation fails to commence construction of Phase II within twenty-seven (27) months after the Effective Date, all redevelopment rights granted hereunder, including the rights of eminent domain and tax abatement, shall expire and terminate. For purposes of this paragraph, “commence construction” means the demolition of all (or substantially all) of the improvements within Phase II as of the Effective Date and the pouring of foundations for at least 75% of the new structures within Phase II, as shown on the Site Plan.

 

(d) Subject to Section 3.01 hereof, if the Corporation fails to commence construction of Phase III (Forsyth Retail Properties) within thirty-six (36) months after the Final Acquisition Date, all redevelopment rights granted hereunder, including the rights of eminent domain and tax abatement, shall expire and terminate. For purposes of this paragraph, “commence construction” means the demolition of all (or substantially all) of the improvements within Phase III (Forsyth Retail Properties) as of the Effective Date and the pouring of foundations for 100% of the new structures within Phase III (Forsyth Retail Properties), as shown on the Site Plan.

 

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(e) The parties acknowledge that by operation of Section 4.02(b) of this Agreement, if the Corporation fails to commence construction of Phase III (Tower B) within thirty-six (36) months after the Final Acquisition Date, the total period during which the Corporation is entitled to tax abatement hereunder shall be shortened in accordance with such Section 4.02(b) .

 

2.07 Site Plan. The Corporation may make changes to the Site Plan as site conditions or other issues of feasibility may dictate or as may be required to meet the reasonable requests of prospective tenants or as may be necessary or desirable in the sole determination of the Corporation to enhance the economic viability of the Redevelopment Project; provided that (a) the Corporation may not make any material changes to the Site Plan ( i.e., changes which either reduce the square footage or intended uses of the Redevelopment Project by more than 10% exclusive of reductions required to comply with the City’s Code of Ordinances), whether individually or in the aggregate, without the advance written consent of the Board of Aldermen and (b) the Corporation shall obtain the City’s consent to any changes to the extent required by the City’s Code of Ordinances. The Corporation shall promptly furnish the City with a current Site Plan in the event of any changes thereto.

 

2.08 Certificate of Substantial Completion. After substantial completion of construction of any phase of the Redevelopment Project in accordance with the Redevelopment Plan, the Corporation shall deliver to the City a Certificate of Substantial Completion for the applicable phase of the Redevelopment Project in substantially the form attached hereto as Exhibit D . The City shall sign the Certificate of Substantial Completion upon the City’s verification that the representations in such certificate are accurate (which shall not be unreasonably withheld, conditioned or delayed). The City may issue any and all appropriate certificates of occupancy in accordance with the City’s ordinances, even if the City has not yet accepted the Certificate of Substantial Completion. If the Corporation fails to deliver a Certificate of Substantial Completion to the City with respect to any phase of the Redevelopment Project in a timely fashion and the City has issued occupancy certificates with respect to at least seventy-five percent (75%) of the usable space in such phase of the Redevelopment Project, the City may at its sole option deem the delivery of such occupancy certificates to constitute delivery of the Certificate of Substantial Completion for such phase.

 

2.09 Financial Ability. The Corporation shall submit to the City, prior to the commencement of construction of any phase or all of the Redevelopment Project, as applicable, (a) reasonable proof of the Corporation’s financial ability to complete the Redevelopment Project, and (b) reasonably acceptable performance and payment bonds and maintenance bonds, as required by the City’s Code of Ordinances, issued in connection with the public improvements to be constructed by or at the direction of the Corporation for the Redevelopment Project. The City and the Corporation shall be named as obligees on the bonds. The City will not issue a Building Permit for any structure in the Redevelopment Area until the Corporation submits to the City the items specified in this Section.

 

2.10 Removal of Blight. The Corporation shall clear blight or rehabilitate to eliminate the physical blight existing in the Redevelopment Area, or to make adequate provisions satisfactory to the City for the clearance of such blight. This obligation shall be a covenant running with the land and shall not be affected by any sale or disposition of the Redevelopment Area. Any purchaser of property in the Redevelopment Area from the Corporation or any of the Corporation’s successors in title, who wishes to receive the development rights and tax abatement granted by this Agreement, shall acquire title subject to this obligation insofar as it pertains to the land so acquired.

 

2.11 Insurance. Not less than ten (10) days prior to commencement of construction of each and any portion of the Redevelopment Project, the Corporation and/or its general contractor shall provide the City with a certificate of insurance evidencing a commercial general liability insurance policy with

 

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coverages of not less than $2,234,121 for claims arising out of a single accident or occurrence and $335,118 for any one person in a single accident or occurrence, which reflects the current absolute statutory waivers of sovereign immunity in Sections 537.600 and 537.610 of the Revised Statutes of Missouri, as amended. Further, the policy shall be adjusted upward annually, to remain at all times not less than the inflation-adjusted sovereign immunity limits as published in the Missouri Register on an annual basis by the Department of Insurance pursuant to Section 537.610 of the Revised Statutes of Missouri, as amended. The policy shall provide that it may not be cancelled, terminated, allowed to lapse or be substantially modified without at least thirty (30) days prior written notice to the City. The City shall be listed as an additional insured on such certificate. Such policy shall include a severability of interests clause and the insurance shall be primary with respect to any applicable insurance maintained by the City. The requirements of this Section shall terminate for each Phase upon the City’s acceptance of a Certificate of Substantial Completion for said Phase of the Redevelopment Project.

 

2.12 Redevelopment Project Maintenance. Upon substantial completion of the Redevelopment Project and so long as this Agreement is in effect, the Corporation or its successor(s) in interest, as owner or owners of the affected portion(s) of the Redevelopment Area, shall maintain or cause to be maintained the buildings and improvements within the Redevelopment Area which it owns in a good state of repair and in conformity with applicable state and local laws, ordinances, and regulations.

 

2.13 Changes. The Corporation shall promptly notify the City in writing of any changes in the location of the Corporation’s principal place of business and of any other material adverse change in fact or circumstance directly affecting the Redevelopment Project.

 

2.14 City Access to Redevelopment Project. The City may conduct such periodic inspections of the Redevelopment Area and the Redevelopment Project as may be generally provided in the City’s Code of Ordinances. In addition, the Corporation shall allow any authorized representatives of the City access to the Redevelopment Area and the Redevelopment Project from time to time upon reasonable advance notice prior to the completion of the Redevelopment Project for reasonable inspection thereof. The Corporation shall also allow the City and its employees, agents and representatives to inspect, upon request, all architectural, engineering, demolition, construction and other contracts and documents pertaining to the construction of the Redevelopment Project as the City determines is reasonable and necessary to verify the Corporation’s compliance with the terms of this Agreement.

 

2.15 Construction/Use Provisions.

 

(a) The Corporation agrees to construct the Redevelopment Project in accordance with the City’s Code of Ordinances and with the site development/construction specifications that are described on Exhibit F hereto. In addition, the Corporation agrees that the office towers within the Redevelopment Project will be constructed and maintained in a manner such that they will be classified as “Class A” or “first-class” office space by commercial real estate brokers. The Corporation further acknowledges the City’s desire that the Redevelopment Project be constructed in accordance with standards established by the U.S. Green Building Council (USGBC) in order to obtain LEED certification, and the Corporation will, or will cause the Developer to, use commercially reasonable efforts to incorporate USGBC standards into the design, construction and maintenance of the Redevelopment Project.

 

(b) The Corporation covenants that the uses in the Redevelopment Area shall at all times be in accordance with the zoning and subdivision approvals granted by the City, and all conditions thereof, for the Redevelopment Area.

 

(c) The City agrees to cooperate with the Corporation and to process and timely consider all applications for governmental approvals as received, all in accordance with the applicable City ordinances and laws of the State of Missouri, for the vacation of one or more alleys in the Redevelopment Area and the granting of other City easements as necessary to implement the Site Plan.

 

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2.16 Development Expertise. The Corporation shall, before May 15, 2006, provide evidence to the City that the Corporation has entered into a joint venture or co-developer arrangement with an entity with sufficient expertise to carry out the retail portion of the Redevelopment Project.

 

ARTICLE 3

FORCE MAJEURE

 

3.01 Force Majeure.

 

(a) Upon satisfaction of the provisions of paragraph (b) of this Section, the time periods provided for herein shall be extended by the number of days of delay caused by actions or events beyond the control of the Corporation, including acts of God, labor disputes, strikes, lockouts, civil disorder, war, lack of issuance of any permits and/or legal authorization by any governmental entity necessary for Corporation to proceed with the construction of the Redevelopment Project, shortage or delay in the shipment of material or fuel, governmental action, fire, unusually adverse weather conditions, wet soil conditions, unavoidable casualties, litigation that challenges the Corporation’s right to acquire property by eminent domain or that contests the designation of the Redevelopment Area as blighted, or by any other cause which the City Manager determines may justify the delay; provided that any such occurrences or events shall not be deemed to exist as to any matter initiated or unreasonably sustained by Corporation, and further provided that Corporation notifies the City in writing within thirty (30) days of the commencement of any of the foregoing events.

 

(b) No event under (a) shall be deemed to exist (1) as to any matter that could have been avoided by the exercise of due care on the part of the Corporation, (2) as to any matter initiated or unreasonably sustained by the Corporation, and (3) unless the Corporation provides the City with a written notice within 30 days of the commencement of such claimed event specifying the event of force majeure .

 

3.02 Extensions. In addition to any extension permitted pursuant to Section 3.01 of this Agreement, the City may, upon request of the Corporation and approval by the Board of Aldermen in its sole discretion, extend times within which development activities are to commence or be completed.

 

ARTICLE 4

TAX ABATEMENT AND PAYMENTS IN LIEU OF TAXES

 

4.01 Tax Abatement . The tax abatement provided in this Section, and the corresponding payments in lieu of taxes as required by Section 4.02 , shall apply to each phase of the Redevelopment Project, and references in this Section and in Section 4.02 to the Redevelopment Area shall apply to that portion of the Redevelopment Area associated with the appropriate phase of the Redevelopment Project; provided, in no event shall the tax abatement extend longer than 15 years after the Effective Date.

 

(a) First Ten (10) Years . Subject to the provisions of this Agreement, the real property within the Redevelopment Area shall not be subject to assessment or payment of general ad valorem taxes imposed by the City, the State of Missouri, or any political subdivision thereof, for a period of ten (10) years after the date upon which the Corporation acquires title to such property (but only for so long as said parcel is used in accordance with the Redevelopment Plan),

 

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except to such extent and in such amount as may be imposed upon such real property during such period measured solely by the amount of the assessed valuation of land, exclusive of improvements, during the calendar year preceding the calendar year during which the Corporation acquired title to such real property.

 

(b) Next Five (5) Years . Until the earlier of (1) the completion of five (5) additional years after the first ten (10) years in Section 4.01(a); or (2) twelve (12) complete calendar years after delivery or deemed delivery of the Certificate of Substantial Completion, ad valorem taxes upon the real property within the Redevelopment Area shall be measured by the assessed valuation thereof as determined by the St. Louis County Assessor upon the basis of not to exceed fifty percent (50%) of the true value of such real property, including improvements thereon, nor shall such valuations be increased above fifty percent (50%) of the true value of said real property from year to year during such period so long as the Redevelopment Area is used in accordance with this Agreement and the Redevelopment Plan.

 

(c) Abatement Contingent upon Compliance with Redevelopment Plan . The tax relief provided in this Section shall be contingent upon the Corporation’s compliance with the Redevelopment Plan and this Agreement, and shall apply to general ad valorem taxes only and shall not be deemed or construed to exempt the Corporation or its successors in interest, in whole or in part, from special assessments, fees, charges or other taxes that may be imposed by the City or another governmental unit.

 

(d) Expiration . Upon the expiration of such periods, the real property comprising the Redevelopment Area shall be subject to assessment and payment of all ad valorem taxes, based upon the full true value of such real property.

 

4.02 Payments in Lieu of Taxes.

 

(a) Agreement to Make PILOTs . Notwithstanding any provisions of Section 4.01 above and Section 353.110 of the URC Law to the contrary, the Corporation agrees that, in addition to the ad valorem taxes computed pursuant to Section 4.01 hereinabove, it will pay to the St. Louis County Collector of Revenue (“Collector”), on or before December 31 of each year during which real property taxes are abated in accordance with Section 4.01 above, payments in lieu of taxes (“PILOTs”) according to the following:

 

(1) PILOTs during First Ten (10) Years . During the first ten (10) years of each phase or all of the Redevelopment Project, as applicable, the Corporation will make the following PILOTS:

 

(A) Calendar years before and including Substantial Completion:

 

(i) The portion of the PILOTs calculated for the land in the Redevelopment Area shall equal one hundred percent (100%) of the total assessed valuation of such land, excluding the value of such land prior to the initiation of the Redevelopment Project, until the City accepts the Certificate of Substantial Completion; and

 

(ii) The portion of the PILOTs calculated for the improvements on property in the Redevelopment Area shall equal one hundred percent (100%) of the total assessed valuation of the improvements, until the City accepts the Certificate of Substantial Completion.

 

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(B) Calendar years after Substantial Completion:

 

(i) The portion of the PILOTs calculated for the land in the Redevelopment Area shall equal fifty percent (50%) of the total assessed valuation of such land, excluding the value of such land prior to the initiation of the Redevelopment Project, for each year after the City accepts the Certificate of Substantial Completion; and

 

(ii) The portion of the PILOTs calculated for the improvements on property in the Redevelopment Area shall equal fifty percent (50%) of the total assessed valuation of the improvements, for each year after the City accepts the Certificate of Substantial Completion.

 

(2) PILOTs during Next Five (5) Years . Until the earlier of (A) the completion of five (5) additional years after the first ten (10) years in Section 4.02(a)(1) or (B) twelve (12) complete calendar years after delivery of the Certificate of Substantial Completion for the Redevelopment Project, the Corporation shall make PILOTs which, when added to payments made pursuant to Section 4.01 , shall equal fifty percent (50%) of the general ad valorem taxes that would have been due and payable for both land and improvements in the absence of the tax abatement provided in Section 4.01 .

 

(b) Adjustment of PILOTS for Failure to Maintain Jobs . Centene Corporation will maintain the following number of Jobs within the Redevelopment Area during the term of this Agreement:

 

 

If Centene Corporation fails to maintain the minimum number of Jobs within the Redevelopment Area as herein provided, measured by determining the highest actual number of Jobs during the 90-day period ending on each Test Date, either Centene Corporation or the Corporation shall make a PILOT payment (in addition to any payments required under Section 4.02(a) ) to the Collector on or before December 31 of each such calendar year in which Centene Corporation fails to maintain the required number of Jobs, in an amount equal to:

 

 

 

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The Corporation shall perform the calculation set forth in this Section on each Test Date, and shall promptly provide a copy of such calculation to the City, accompanied by a written certification of the Corporation that none of the Jobs included in such calculation is occupied by a person that has been hired for the primary purpose of satisfying or inflating the calculation of Jobs required by this Agreement. The Corporation shall also provide to the City, promptly upon request, any information reasonably required by the City to verify such calculation. Any resulting increase in Additional PILOT Payments as a result of such calculation shall be paid for the calendar year in which such Test Date occurs. In no event shall the PILOT payments as a result of such calculation exceed the amount of taxes that the Corporation would have been required to pay during the applicable year in the absence of the adoption of the Development Plan.

 

For purposes of this Section, (a) “Job” means a full-time equivalent job position with Centene Corporation of not less than 35 hours per week within the Redevelopment Area, which shall include normal full-time employee benefits offered by Centene Corporation, and (b) “Test Date” means October 1 of each year, beginning on October 1, 2006.

 

(c) Payment, Distribution and Enforcement . The obligation to make the foregoing PILOTs shall constitute a lien against the Redevelopment Area, enforceable by the City in the same manner as general real estate taxes. The Board of Aldermen shall furnish the Collector with a copy of this Agreement. The Collector shall allocate the revenues received from such PILOTs (whether received under this Section or any other provision of this Agreement) among applicable taxing authorities in accordance with Section 353.110.4 of the URC Law.

 

4.03 Earnings Limitation on Redevelopment Project. The net earnings of the Corporation (and/or any successor owner) from the Redevelopment Project shall be limited in accordance with the applicable provisions of the URC Law.

 

4.04 Financial and Annual Reports.

 

(a) During the period of tax relief provided in this Agreement for each phase or all of the Redevelopment Project, as applicable, the Corporation shall provide annually to the City’s Finance Director, within one hundred twenty (120) days after the end of the Corporation’s fiscal year, three (3) copies of its detailed financial report for the preceding year for the Redevelopment Project, examined by a certified public accountant and containing a certification concerning such examination. Said financial reports shall disclose:

 

(1) the Corporation’s earnings derived from the Redevelopment Project;

 

(2) the disposition of any net earnings in excess of those permitted by Section 4.03 above;

 

(3) the interest rate on income debentures, bonds, notes or other evidences of debt of Corporation;

 

(4) the Corporation’s cost of the Redevelopment Project; and

 

(5) the Corporation’s income and expenses derived from or attributable to the Redevelopment Project.

 

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(b) If, in the Finance Director’s judgment, the financial reports fail to provide the information required by this Section in accordance with generally accepted accounting principles or if a material dispute arises regarding the information provided in a financial report, and if requested by the City in writing, the Corporation shall, at its own expense and in an amount agreed by the Corporation and the City, have an audit made of its books by an auditing firm to be named by the City and approved by the Corporation, and the findings of such audit shall be made available to the Finance Director.

 

4.05 Accounting Practices. The Corporation shall establish and maintain depreciation, obsolescence, and other reserves, and surplus and other accounts, including a reserve for the payment of taxes and PILOTs, according to recognized standard accounting practices.

 

ARTICLE 5

TRANSFER OF THE REDEVELOPMENT AREA

 

5.01 Corporation’s Right to Transfer the Redevelopment Area.

 

(a) Sale to Developer . The Corporation may voluntarily sell, lease, assign, transfer, convey and/or otherwise dispose (hereinafter collectively referred to as a “Sale”) the Redevelopment Area or any portion thereof to the Developer or an Affiliate without the City’s prior written consent, but the Corporation shall provide written notice to the City within ten (10) days following such Sale to any such entity. Upon a Sale, all of the Corporation’s rights and obligations hereunder with respect to the subject property, including those concerning tax abatement and eminent domain, shall transfer to such entity.

 

(b) Sale to Third Party . If the proposed Sale is to a party other than the Developer or an Affiliate, then the Corporation shall first obtain the City’s written consent (which consent shall not be unreasonably withheld or delayed). The City may require that any proposed transferee, other than the Developer or an Affiliate, demonstrate to the City’s reasonable satisfaction that the transferee is sufficiently experienced and financially capable in that it has reasonable financial worth and experience in light of the responsibilities undertaken. In the event of such a Sale, all rights and obligations of the Corporation hereunder with respect to the subject property, including those concerning tax abatement and eminent domain, shall transfer to the transferee.

 

(c) Transferee Agreement . In the event of each transfer of property in the Redevelopment Area pursuant to Section 5.01(b) , the Corporation or its authorized successors and assigns shall require the proposed transferee to execute a transferee agreement with the City in substantial compliance with the form attached as Exhibit E . No Sale shall occur without the prior execution of a transferee agreement with the City. The parties agree that the intention of each transferee agreement is to protect the Corporation and the City by ensuring that all transferees of property within the Redevelopment Area receive actual notice of the rights, duties and obligations contained in this Agreement prior to taking ownership, and nothing contained in a transferee agreement that is an accordance with Exhibit E shall be deemed to impose any rights, duties or obligations that are not imposed pursuant to this Agreement.

 

ARTICLE 6

DEFAULT AND REMEDIES

 

6.01 Default and Remedies.

 

(a) Event of Default . The occurrence and continuance of any of the following shall constitute a “Corporation Event of Default”:

 

(1) Centene Corporation fails to maintain its headquarters within the Redevelopment Area (for purposes of this section the term “headquarters” means the location at which Centene Corporation maintains its centralized administrative, management, finance and support functions); or

 

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(2) the Corporation fails to make the punctual payment of the PILOTs on the due date; or

 

(3) the Corporation fails to timely perform, in all material respects, any obligation or covenant of the Corporation under this Agreement, and such failure is not cured to the City’s reasonable satisfaction within thirty (30) days after the City gives written notice thereof to the Corporation, or if it cannot reasonably be cured within thirty (30) days, the Corporation is not diligently proceeding to cure same.

 

(b) Remedies. The City shall have the following remedies upon the occurrence of a Corporation Event of Default:

 

(1) if the default is under (a)(1) or (a)(3) above, the City’s sole remedy shall be to terminate this Agreement; and

 

(2) if the default is under (a