AGENT AGREEMENT
THIS AGENT AGREEMENT, made as of the 12th day of November, 2013 (the “Agreement”), by and between the COUNTY OF SULLIVAN INDUSTRIAL DEVELOPMENT AGENCY, a public benefit corporation of the State of New York, having its offices at 1 Cablevision Center, Ferndale, New York 12734 (the “Agency”) and VERIA LIFESTYLE INC., a Delaware limited liability company having offices at 1 Penn Plaza, 35th Floor, New York, New York 10119 (the “Company”).
W I T N E S S E T H :
WHEREAS, the Agency was created by Chapter 560 of the Laws of 1970 of the Laws of 1970 of the State of New York pursuant to Title I of Article 18-A of the General Municipal Law of the State of New York (collectively, the “Act”) as a body corporate and politic and as a public benefit corporation of the State of New York; and
WHEREAS, the Company has requested the Agency’s assistance with a certain project (the “Project”) consisting of: (i) the acquisition by the Agency of a leasehold interest in approximately 22 parcels of land containing in the aggregate approximately 1,310 acres located in the Town of Thompson, Sullivan County, New York, and being comprised of the commonly known Kutsher’s Country Club, Camp Anawana, Camp Sherwood, Old Liberty Road Sewer Treatment Plant, Fair Hills Bungalow Colony and Kutsher’s Country Club Golf Course, all as more particularly identified in the Company’s Application (collectively, the “Land”) and the existing building, buildings, structure or structures located thereon (collectively, the “Existing Improvements”), (ii) the demolition of certain of the Existing Improvements (the “Building Improvements”), (iii) the construction, reconstruction, renovation and/or repair of water and sewer infrastructure located on the Land (the Infrastructure Improvements”), and (iv) the acquisition and installation by the Company in and around the Existing Improvements, the Building Improvements and the Infrastructure Improvements of certain items of equipment and other tangible personal property (the “Equipment” and, collectively with the Land, the Existing Improvements, the Building Improvements and the Infrastructure Improvements, the “Facility”); and
WHEREAS, by resolution adopted October 8, 2013 (the “Resolution”), the Agency authorized the Company to act as its agent for the purposes of undertaking the Project subject to the Company entering into this Agreement.
NOW THEREFORE, in consideration of the covenants herein contained and other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, it is mutually agreed as follows:
|
|
1. (a) Scope of Agency and Master Developer Designation. The Agency hereby designates the Company its true and lawful agent, as well as the Developer for the Land and the Project, and the Company hereby accepts such agency on behalf of itself, solely for purposes of undertaking the Project. The right of the Company to act as agent of the Agency and Developer for the Land and the Project shall expire on December 31, 2014, unless extended as contemplated by the Resolution. The Agency shall provide all authorized forms of Agency financial assistance to the Company or its designees for the Project. During the ten (10) year period following the date of this Agent Agreement (the “Development Period”), the Agency shall not modify, alter or change the proposed forms of financial assistance as more particularly provided for in the Resolution, including, but not limited to the Relevant UTEP Programs, except to the extent that (i) there is a change in supervening Federal or State laws, rules or regulations, or (ii) a change in circumstances or newly discovered information, establishing that the Project or any portion thereof is likely to result in a material harm or endangerment to the public health, safety or welfare, which harm or endangerment cannot be prevented by the Company after reasonable notice and time to cure. In the event that an exception to the protections set forth hereunder occur and continue during the Development Period, said exception shall relate only to the portion or aspect of the Project affected by the newly discovered information or change in circumstances. The Agency shall evaluate periodically the progress of the development of the Project, and shall have the right in its reasonable discretion to rescind any rights granted to the Company under this subparagraph 1(a), only if (1) after the end of the fourth (4) year of the execution of this Agent Agreement, the Company and any of its tenants, lessees, subtenants, or other owners or occupants of the Land have cumulatively employed less than _____ (____) full-time permanent employees related to the Project, and (ii) at the end of each year thereafter up to the tenth (10) year after the execution of this Agent Agreement, the Company and any of its tenants, lessees, subtenants, or other owners or occupants of the Land have cumulatively employed less than _______ (____) additional permanent full-time employees related to the Project, provided, that once the Company and any of its tenants, lessees, subtenants, or other owners or occupants of the Land cumulatively employ _________ (______) permanent full-time employees related to the Project, then the Agency during the Development Period shall not modify, alter or change the proposed forms of financial assistance herein, including, but not limited to the Relevant UTEP Programs. The ten (10) year Development Period hereunder is not a personal right, and shall attach to and run with the Land and Improvements hereunder.
(b) The aggregate amount of work performed as Agent for the Agency shall not exceed the amounts described in the Application of the Company in this matter. All contracts entered into as agent for the Agency shall include the following language:
“This contract is being entered into by VERIA LIFESTYLE INC (the “Agent”), as agent for and on behalf of the COUNTY OF SULLIVAN INDUSTRIAL DEVELOPMENT AGENCY (the “Agency”), in connection with a certain project of the Agency for the Agent consisting in part of the acquisition and installation of certain machinery, equipment and building materials, all for incorporation and installation in certain premises located on 22 parcels of land in the Town of Thompson, Sullivan County, New York (the “Premises”). The machinery, equipment and building materials to be incorporated and installed in the Premises shall be exempt from the sales and use taxes levied by the State of New York if the acquisition thereof is effected in accordance with the terms and conditions set forth in the attached sales tax exemption letter of the Agency; and the Agent hereby represents that this contract is in compliance with the terms of the sales tax exemption letter. This contract is non-recourse to the Agency, and the Agency shall not be directly, indirectly or contingently liable or obligated hereunder in any manner or to any extent whatsoever. By execution or acceptance of this contract, the vendor/contractor hereby acknowledges and agrees to the terms and conditions set forth is this paragraph.”
(c) To secure payment of the Agency’s fees, the Company shall deposit with the Agency $_______________, in escrow (“Escrow Deposit”). Commencing on the fifteenth (15th) day of January 2014, and on the fifteenth (15th) day of each month thereafter the Company shall file with the Agency a report certified under oath as the taxable purchases which have been made by the Company during the prior calendar month without payments of sales tax (each a “Sales Tax Report”). Each Sales Tax Report shall be prepared on a “cash” basis with each purchase deemed to have occurred upon payment of an invoice relating to each such purchase. Each Sales Tax Report shall be accompanied by a check made payable to the Agency. In the event the monthly Sales Tax Report and accompanying payment is not received by the Agency by the fifteenth (15th) of the month, the Agency shall notify the Company in writing of its failure to submit the Sales Tax Report, in which event the Company shall have ten (10) days within which to submit the Sales Tax Report and payment. If the Company fails to submit the Sales Tax Report and payment following the notice and cure period, the Agency may immediately withdraw and pay over to the Agency the entire Escrow Deposit and terminate the Sales Tax Exemption Letter; provided, however, that within thirty (30) days after the filing by the Company of Form ST-340 for the year in which the termination occurs (a copy of which shall be provided to the Agency at (x) the Company shall pay to the Agency any additional fee which is due but has not yet been paid in connection with taxable purchases for which the Company availed itself of the abatement prior to termination, or (y) the Agency shall refund to the Company any amount of the fee previously paid to the Agency that exceeds the amount due to the Agency for taxable purchases for which the Company availed itself of the abatement prior to termination. Upon such termination, the Company shall immediately commence paying sales tax on all purchases made on or after the date of termination and shall provide written notice to its current vendors advising of the termination of the Agency’s Sales Tax Exemption Letter. Evidence of the notice of termination to its vendors shall be supplied by the Company to the Agency within the ten (10) days of termination.
2. Representations and Covenants of the Company. The Company makes the following representations and covenants in order to induce the Agency to proceed with the Project:
(a) The Company is a Delaware limited liability company duly qualified and authorized to do business in the State of New York (the “State”), has the authority to enter into this Agreement and has duly authorized the execution and delivery of this Agreement.
|
|
(b) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby nor the fulfillment of or compliance with the provisions of this Agreement will conflict with or result in a breach of any of the terms, conditions or provisions of any restriction or any agreement or instrument to which the Company is a party or by which it is bound, or will constitute a default under any of the foregoing, or result in the creation or imposition of any lien of any nature upon any of the property of the Company under the terms of any such instrument or agreement.
(c) The Facility Improvements and the operation thereof will conform with all applicable zoning, planning, building and environmental laws and regulations of governmental authorities having jurisdiction over the Facility Improvements, and the Company shall defend, indemnify and hold the Agency harmless from any liability or expenses resulting from any failure by the Company to comply with the provisions of this subsection (c).
(d) There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body pending or, to the knowledge of the Company, threatened against or affecting the Company, to which the Company is a party, and in which an adverse result would in any way diminish or adversely impact on the Company’s ability to fulfill its obligations under this Agreement.
(e) The Company covenants that the Facility Improvements will comply in all respects with all environmental laws and regulations, and, except in compliance with environmental laws and regulations, (i) that no pollutants, contaminants, solid wastes, or toxic or hazardous substances will be stored, treated, generated, disposed of, or allowed to exist on the Facility Improvements except in compliance with all material applicable laws, (ii) the Company will take all reasonable and prudent steps to prevent an unlawful release of hazardous substances onto the Facility Improvements or onto any other property, (iii) that no asbestos will be incorporated into or disposed of on the Facility Improvements, (iv) that no underground storage tanks will be located on the Facility, and (v) that no investigation, order, agreement, notice, demand or settlement with respect to any of the above is threatened, anticipated, or in existence. The Company upon receiving any information or notice contrary to the representations contained in this Section shall immediately notify the Agency in writing with full details regarding the same. The Company hereby releases the Agency from liability with respect to, and agrees to defend, indemnify, and hold harmless the Agency, its Executive Director, members, officers, employees, agents (except the Company), representatives, successors, and assigns from and against any and all claims, demands, damages, costs, orders, liabilities, penalties, and expenses (including reasonable attorneys’ fees) related in any way to any violation of the covenants or failure to be accurate of the representations contained in this Section. In the event the Agency in its reasonable discretion deems it necessary to perform due diligence with respect to any of the above, or to have an environmental audit performed with respect to the Facility Improvements, the Company agrees to pay the expenses of same to the Agency upon demand, and agrees that upon failure to do so, its obligation for such expenses shall be deemed to be additional rent.
(f) Any personal property acquired by the Company in the name of the Agency shall be located in Sullivan County, New York, except for temporary periods during ordinary use.
(g) In accordance with Section 875(3) of the New York General Municipal Law, the Company covenants and agrees that, if it receives New York State and local sales and use tax exemption benefits (“sales and use tax exemption benefits”) from the Agency, and it is determined that: (i) the Company is not entitled to the sales and use tax exemption benefits; (ii) the sales and use tax exemption benefits are in excess of the amounts authorized by the Agency to be taken by the Company; (iii) the sales and use tax exemption benefits are for property or services not authorized by the Agency as part of the Project; or (iv) the sales and use tax exemption benefits are taken in cases where the Company fails to comply with a material term or condition to use property or services in the manner approved by the Agency in connection with the Project, then the Company will (i) cooperate with the Agency in its efforts to recover or recapture any sales and use tax exemption benefits, and (ii) promptly pay over any such amounts to the Agency that the Agency demands in connection therewith. The Company further understands and agrees that in the event that the Company fails to pay over such amounts to the Agency, the New York State Tax Commissioner may assess and determine New York State and local sales and use taxes due from the Company, together with any relevant penalties and interest due on such amounts.
(h) The Company further covenants that the purchase of goods and services relating to the Project and subject to New York State and local sales and use taxes are estimated in amount up to $1,100,000, and, therefore, the value of the sales and use tax exemption benefits authorized and approved by the Agency cannot exceed $88,000.
(i) The Project constitutes a “tourism destination” as defined in Section 862(2) of the Act.
3. Hold Harmless Provision. The Company hereby releases the Agency from, agrees that the Agency shall not be liable for, and agrees to indemnify, defend and hold the Agency and its Executive Director, officers, members employees, agents (except the Company), representatives, successors and assigns harmless from and against any and all (i) liability for loss or damage to property or injury to or death of any and all persons that may be occasioned by any cause whatsoever pertaining to the Project or arising by reason of or in connection therewith or breach by the Company of this Agreement or (ii) liability arising from or expense incurred by the Agency’s financing, acquiring, rehabilitating, constructing, renovation, equipping, owning and leasing of the Facility Improvements, including without limiting the generality of the foregoing, all causes of action and reasonable attorneys’ fees and any other expenses incurred in defending any suits or actions which may arise as a result of any of the foregoing. The foregoing indemnities shall apply notwithstanding the fault or negligence on the part of the Agency, or any of its respective members, directors, officers, agents (except the Company) or employees and irrespective of the breach of a statutory obligation or the application of any rule of comparative or apportioned liability, except that such indemnities will not be applicable with respect to willful misconduct or gross negligence on the part of the Agency or any other person or entity to be indemnified.
4. Insurance Required. Effective as of the date hereof and until the Agency consents in writing to a termination, the Company shall maintain or cause to be maintained insurance against such risks and for such amounts as are customarily insured against by businesses of like size and type paying, as the same become due and payable, all premiums in respect thereto, including, but not necessarily limited to:
(a) (i) Insurance against loss or damage by fire, lightning and other casualties, with a uniform standard extended coverage endorsement, such insurance to be in an amount not less than the full replacement value of the Facility Improvements, exclusive of excavations and foundations, as determined by a recognized appraiser or insurer selected by the Company or (ii) as an alternative to the above requirements (including the requirement of periodic appraisal), the Company may insure the Facility Improvements under a blanket insurance policy or policies covering not only the Facility Improvements but other properties as well.
(b) Workers’ compensation insurance, disability benefits insurance, and each other form of insurance which the Agency or the Company is required by law to provide, covering loss resulting from injury, sickness, disability or death of employees of the Company who are located at or assigned to the Facility Improvements.
(c) Insurance against loss or losses from liabilities imposed by law or assumed in any written contract and arising from personal injury and death or damage to the property of others caused by any accident or occurrence, with limits of not less than $1,000,000 per accident or occurrence on account of personal injury, including death resulting therefrom, and $1,000,000 per accident or occurrence on account of damage to the property of others, excluding liability imposed upon the Company by any applicable workers’ compensation law; and a blanket excess liability policy in the amount not less than $3,000,000, protecting the Company against any loss or liability or damage for personal injury or property damage.
5. Additional Provisions Respecting Insurance. (a) All insurance required by Section 4(a) hereof shall name the Agency as a named insured and all other insurance required by Section 4 shall name the Agency as an additional insured. All insurance shall be procured and maintained in financially sound and generally recognized responsible insurance companies selected by the Company and authorized to write such insurance in the State. Such insurance may be written with deductible amounts comparable to those on similar policies carried by other companies engaged in businesses similar in size, character and other respects to those in which the Company is engaged. All policies evidencing such insurance shall provide for (i) payment of the losses of the Company and the Agency as their respective interest may appear, and (ii) at least thirty (30) days prior written notice of the cancellation thereof to the Company and the Agency.
(b) All such policies of insurance, or a certificate or certificates of the insurers that such insurance is in force and effect, shall be deposited with the Agency on the date hereof. Prior to expiration of any such policy, the Company shall furnish evidence to the Agency that the policy has been renewed or replaced or is no longer required by this Agreement.
6. This Agreement may be executed in any number of counterparts each of which shall be deemed an original but which together shall constitute a single instrument.
7. All notices, claims and other communications hereunder shall be in writing and shall be deemed to be duly given if personally delivered or mailed first class, postage prepaid, as follows:
To the Agency: County of Sullivan Industrial Development Agency
1 Cablevision Center
Ferndale, New York 12734
Attn.: Executive Director
With a Copy to: Harris Beach PLLC
99 Garnsey Road
Pittsford, New York14534
Attn.: Shawn M. Griffin, Esq.
To the Company: Veria Lifestyle Inc.
1 Penn Plaza, 35th Floor
New York, New York 10119
Attn: Adam Cassidy
With a Copy to: Stoloff & Silver, LLP
26 Hamilton Avenue
PO Box 1129
Monticello, New York 12701
Attn: Gary D. Silver, Esq.
or at such other address as any party may from time to time furnish to the other party by notice given in accordance with the provisions of this Section. All notices shall be deemed given when mailed or personally delivered in the manner provided in this Section.
8. This Agreement shall be governed by, and all matters in connection herewith shall be construed and enforced in accordance with, the laws of the State applicable to agreements executed and to be wholly performed therein and the parties hereto hereby agree to submit to the personal jurisdiction of the Federal or state courts located in Sullivan County, New York.
9. The parties are contemplating that, after any applicable public hearings, the Agency will negotiate and enter into a lease agreement (“Lease Agreement”), leaseback agreement (the “Leaseback Agreement”) and payment-in-lieu-of-tax agreement (“PILOT Agreement”) with the Company. The Company agrees not to take title to any real property as agent for the Agency until the Lease Agreement, Leaseback Agreement and PILOT Agreement have been executed and delivered. At any time prior to the execution of the Lease Agreement, Leaseback Agreement and PILOT Agreement, the Agency can transfer title to the Company of all assets acquired by the Company as agent for the Agency. Additionally, at any time prior to execution of the Lease Agreement, Leaseback Agreement and PILOT Agreement, the Company can demand that the Agency transfer title to the Company with respect to all assets acquired by the Company as agent for the Agency, provided all amounts owed the Agency have been paid current.
10. The Financial Assistance provided by the Agency to the Company under this Agent Agreement and related Sales Tax Exemption Letter shall not exceed $100,000 until such time as a public hearing is held in compliance with the Act and a subsequent resolution is adopted by the Agency.
11. By executing this Agent Agreement, the Company covenants and agrees to pay all fees, costs and expenses incurred by the Agency for (i) legal services, including but not limited to those provided by the Agency’s transaction counsel, and (ii) other consultants retained by the Agency in connection with the Project; with all such charges to be paid by the Company at the closing or, if the closing does not occur, within ten (10) business days of receipt of the Agency’s invoices therefore. The Company is entitled to receive a written estimate of fees and costs of the Agency’s transaction counsel.
The Company further covenants and agrees that the Company is liable for payment to the Agency of all charges referred to above, as well as all other actual costs and expenses incurred by the Agency in undertaking the Project notwithstanding the occurrence of any of (i) the applicant’s withdrawal, abandonment, cancellation or failure to pursue the Project; (ii) the inability of the Agency or the Company to procure the services of one or more financial institutions to provide financing for the Project; or (iii) the Company’s failure, for whatever reason, to undertake and/or successfully complete the Project.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.
COUNTY OF SULLIVAN INDUSTRIAL DEVELOPMENT AGENCY
By: _______________________________
Name:
Title:
VERIA LIFESTYLE INC.
By: _______________________________
Name:
Title:
##