CCR2003102 (2).
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COMMON COUNCIL OF THE CITY OF MUSKEGO, WISCONSIN
Resolution No. 102-2003
RESOLUTION GIVING APPROVAL TO THE CONVEYANCE OF PROPERTY TO THE
COMMUNITY DEVELOPMENT AUTHORITY OF THE CITY OF MUSKEGO,
APPROVING THE LEASE OF CERTAIN PROPERTY AND IMPROVEMENTS BY THE
CITY OF MUSKEGO AND APPROVING THE ISSUANCE OF NOT TO EXCEED
$2,000,000 COMMUNITY DEVELOPMENT LEASE REVENUE BONDS BY THE
COMMUNITY DEVELOPMENT AUTHORITY AND RELATED DOCUMENTS AND
TRANSACTIONS
WHEREAS the Community Development Authority of the City of
Muskego, Wisconsin (the "Authority") has determined certain
property located in Tax Incremental District No.9 to be
blighted within the meaning of Section 66.1333, Wisconsin
Statutes;
WHEREAS, the Authority and the Common Council of the City
of Muskego, Wisconsin (the "Municipality") have, after a duly-
noticed and held public hearing, created a redevelopment project
area under Section 66.1333, Wisconsin Statutes (the
"Redevelopment Project Area") with respect to such blighted
property designated "Redevelopment District No.1" within the
boundaries of Tax Incremental District No.9, and have approved
and adopted a redevelopment plan within the meaning of the Act
in connection with the Redevelopment Project Area (the
"Redevelopment Plan");
WHEREAS the Authority proposes to acquire certain property
in the Redevelopment Project Area described on Exhibit A hereto
(the "Property") from the Municipality, and proposes to carry
out a program of blight elimination, community development and
urban renewal in the Redevelopment Project Area as described in
the Redevelopment Plan, consisting of public improvements and
project costs listed in the Project Plan for Tax Incremental
District No.9, and related costs (collectively, the "Project")
and to lease the improvements described on Exhibit B and the
Property to the Municipality pursuant to a lease in
substantially the form set forth on Exhibit C (the "Lease");
WHEREAS the Common Council has authorized the Authority to
proceed with the issuance and sale of not to exceed $2,000,000
Community Development Lease Revenue Bonds (the "Bonds"), the
proceeds of which shall be used to finance a portion of the
Project;
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. WHEREAS the Authority has submitted a report on the Lease
to this Common Council and has duly noticed and conducted a
public hearing on the Lease;
WHEREAS the Authority has also requested that the
Municipality enter into a Contribution and Cooperation Agreement
(the "Contribution and Cooperation Agreement") in connection
with the issuance of the Bonds;
WHEREAS, the Authority intends to approve the final details
of the Bonds at a subsequent meeting;
WHEREAS, Section 66.1333(13), Wisconsin Statutes,
authorizes the Municipality to lend or contribute funds to
assist a redevelopment project, Section 66.1105(2) (f)l.h.,
Wisconsin Statutes, provides that the amount of contributions
made under Section 66.1333(13) in connection with implementation
of the project plan is an eligible tax increment project cost
and Section 66.1105(2) (f)l.b. permits the Municipality to
recover "financing costs" related to tax increment projects from
tax increment revenues; and
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WHEREAS, the development of the Project is included in the
Project Plan for the Municipality's Tax Incremental District
No.9 (the "District");
NOW, THEREFORE, BE IT RESOLVED by the Common Council of the
Municipality as follows:
Section 1. Approval of the Conveyance of the Property.
The transfer to the Authority of the Property is authorized and
approved.
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Section 2. Approval of the Lease. The Lease, in
substantially the form attached hereto as Exhibit C and
incorporated herein by this reference, with the maximum rental
payments as set forth therein, is hereby approved and the Mayor
and City Clerk/Treasurer are hereby authorized to execute and
deliver the Lease for and on behalf of the Municipality in
substantially the form attached hereto with such insertions or
corrections as shall be approved by them consistent with the
terms hereof, their execution thereof to constitute conclusive
evidence of their approval of any such insertions or
corrections. The rentals paid under the Lease shall be
"financing costs" under Section 66.1105(2) (f)l.b., Wisconsin
Statutes, to the extent they constitute the payment of principal
or interest on the Bonds. The Common Council covenants for the
benefit of the owners of the Bonds that, subject to annual
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appropriation of the Lease rental payments, all funds in the
special fund of the District will be used first to make the
rental payments due under the Lease and only after the rental
payments have been paid in full for any particular year shall
funds in said special fund be used to pay any other project
costs of the District. The Common Council finds that the rental
payments due under the Lease are at the fair market value for
the Property and the improvements to be leased pursuant to the
Lease.
Section 3. Statement of Intent to Appropriate. The Common
Council acknowledges that the projected tax increment to be
derived from the District may not be realized and that the
increment may therefore be insufficient to make payments under
the Lease sufficient to pay all debt service on the Bonds as it
becomes due. The Municipality hereby declares that it fully
expects and anticipates that, if such a shortfall occurs, it
will appropriate funds from other available revenues of the
Municipality sufficient to fund any such shortfall in order to
meet its obligation to make rental payments under the Lease
sufficient to pay when due all principal of and interest on the
Bonds, provided however, that such payment shall be subject to
annual appropriation by the Common Council and shall be subject
to the Municipality's quiet enjoyment of the property and
improvements leased pursuant to the Lease.
Section 4. Approval of the Contribution and Cooperation
Agreement. The Contribution and Cooperation Agreement in
substantially the form attached hereto as Exhibit D and
incorporated herein by this reference is hereby approved and the
Mayor and City Clerk/Treasurer are hereby authorized to execute
and deliver the Contribution and Cooperation Agreement for and
on behalf of the Municipality in substantially the form attached
hereto with such insertions or corrections as shall be approved
by them consistent with the terms hereof, their execution
thereof to constitute conclusive evidence of their approval of
any such insertions or corrections.
Section 5. Approval of the Bonds. The Bonds shall mature
or be subject to mandatory redemption on June 1 in the years and
principal amounts and bear interest at the rates to be
determined by the Authority, provided that the aggregate
principal amount of the Bonds shall not exceed $2,000,000, the
maximum annual debt service shall not exceed the amounts set
forth in the Lease, the Bonds shall mature no later than June 1,
2021, and the Bonds shall bear interest at rates which produce
an average rate per annum not to exceed 5.50%. The price to be
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paid by the purchaser of the Bonds shall not be less than 98.75%
of par.
The Bonds may be subject to redemption prior to
maturity at the option of the Authority and/or subject to
mandatory redemption in the amounts, at the times and in the
manner determined by the Authority. The Reserve Requirement for
the Bonds shall equal the least of (a) 10% of the principal
amount of the Bonds, (b) maximum annual debt service on the
Bonds and (c) 125% of the average annual debt service on the
Bonds.
The terms of the Bonds to be set by the Authority within
the foregoing parameters are hereby approved. The Municipality
designates the Bonds to be "qualified tax-exempt obligations"
pursuant to Section 265(b) of the Internal Revenue Code of 1986,
as amended. The Municipality covenants that it will not
dissolve the Authority until all of the Bonds have been paid or
discharged within the meaning of the resolutions authorizing
their issuance.
Section 6. Undertaking to Provide Continuing Disclosure.
The Municipality, as the obligated person with respect to the
Bonds, hereby covenants and agrees, for the benefit of the
holders of the Bonds, to enter into a written undertaking (the
"Undertaking") required by SEC Rule l5c2-l2 promulgated by the
Securities and Exchange Commission pursuant to the Securities
and Exchange Act of 1934 (the "Rule") to provide continuing
disclosure of certain financial information and operating data
and timely notices of the occurrence of certain events in
accordance with the Rule. The Undertaking shall be enforceable
by the holders of the Bonds or by the original purchaser of the
Bonds on behalf of such holders (provided that the holders' and
purchaser's right to enforce the provisions of the Undertaking
shall be limited to a right to obtain specific performance of
the obligations thereunder and any failure by the Municipality
to comply with the provisions of the Undertaking shall not be an
event of default with respect to the Bonds).
The City Clerk/Treasurer shall provide a Continuing
Disclosure Certificate for inclusion in the transcript of
proceedings, setting forth the details and terms of the
Municipality's Undertaking.
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Section 7. Execution and Delivery of Documents. The Mayor
and City Clerk/Treasurer are hereby authorized for and in the
name of the Municipality to execute and deliver a deed, the
Lease, the Contribution and Cooperation Agreement and any and
all additional documents as may be necessary or desirable to
effectuàte the sale of the Bonds and the completion of the
transactions contemplated hereby.
Adopted, approved and recorded this 22nd day of April,
2003.
~g(~ ay r
Attest: (SEAL)
,.,,~
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EXHIBIT A
Description of Property
The municipally-owned property dedicated for public road
purposes located within the Redevelopment Project Area, and all
public improvements located thereon and thereunder (subject to
. any existing liens and encumbrances upon such property) .
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Description of Leased Improvements
All municipally owned sewer mains and
laterals, water mains and laterals, storm
sewer pipes, and related appurtenances ahd
equipment located or to be located within
the Redevelopment Project Area.
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. EXHIBIT C
Lease Agreement
(see attached)
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Contribution and Cooperation Agreement
(see attached)
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LEASE
AGREEMENT
between
COMMUNITY DEVELOPMENT AUTHORITY OF THE CITY OF
MUSKEGO, WISCONSIN
and
CITY OF MUSKEGO, WISCONSIN
THIS LEASE AGREEMENT is made and entered into as of
, 2003 by and between the COMMUNITY DEVELOPMENT
AUTHORITY OF THE CITY OF MUSKEGO, a Wisconsin municipal
corporation (the "Authority"), and the CITY OF MUSKEGO,
WISCONSIN, a Wisconsin municipal corporation and political
subdivision (the "Municipality").
WITNESSETH:
WHEREAS the Authority has acquired and is currently in
possession of the real estate described in Exhibit A hereto (the
"Property"); and
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WHEREAS the Authority will carry out a program of blight
elimination, community development and urban renewal on the
Property and certain other property located in the Redevelopment
Project Area as described in the Redevelopment Plan, consisting
of public improvements and project costs listed in the Project
Plan for Tax Incremental District No.9; and related costs
(collectively, the "Project") and is financing a portion of the
cost of the Project through the issuance of its $2,000,000
Community Development Lease Revenue Bonds (the "Bonds"); and
WHEREAS pursuant to the provisions of Sections 66.l335 and
66.1333(9) of the Wisconsin Statutes, the Authority has the
power to lease real property and personal property in its
possession to a public body for use in accordance with a
redevelopment plan; and
WHEREAS the Municipality desires to lease the Property and
the portion of the Project described on Exhibit B hereto (the
"Leased Improvements") (collectively, the Property and the
Leased Improvements shall be referred to as the "Leased
Property") from the Authority; and
WHEREAS the execution, delivery and performance of this
Lease Agreement have been duly authorized by the Municipality
and the Authority and all conditions, acts and things necessary
and required by the Constitution and Statutes of the State of
Wisconsin to exist, to have happened, or to have been performed
precedent to or in the execution and delivery of this Lease
Agreement, do exist, have happened and have been performed in
regular form, time and manner.
NOW, THEREFORE, in consideration of the rents, covenants
and agreements herein reserved, mentioned and contained on the
part of the Municipality, its successors and assigns, to be
paid, kept and performed, the Authority by these presents does
hereby agree to lease, demise and let to the Municipality, and
the Municipality does hereby consent to said leasing and hereby
takes and hires, upon and subject to the conditions hereinafter
expressed, the Leased Property.
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ARTICLE I
DEFINITIONS AND USE OF PHRASES
Section 1.1 Definitions. The following terms shall have
the following meanings in this Lease unless the text expressly
or by necessary implication requires otherwise:
"Additional Rentals" means the additional rentals payable
by the Municipality pursuant to Section 3.2(b)' hereof.
"Annual Debt Service Requirement" means the amount of
principal and interest payable on the Bonds in any year.
"Authority" means the Community Development Lease Authority
of the City of Muskego, Wisconsin, a Wisconsin municipal
corporation.
"Bonds" means the Bonds issued by the Authority to provide
financing for the Project.
"Bonds".means the $2,000,000 Community Development Lease
Revenue Bonds, dated this day of , 2003.
"Capitalized Interest Fund" means the capitalized interest
fund established by the Authority in connection with the
issuance of the Bonds.
"Commencement Date" means the date of commencement of the
Leasehold Term as provided in Section 3.1 hereof.
"Debt Service Fund" means the Debt Service Fund established
by the Authority in connection with the issuance of the Bonds.
"Fiscal Agent" means ,
, the fiscal agent for the Bonds or any
successor thereto.
"Leased Improvements" means the improvements described in
Exhibit B hereto.
"Leased Property" means the Property and all fixtures
thereto, and the Leased Improvements.
"Leasehold Term" means the term of this Agreement as
provided in Section 3.1 hereof.
"Municipality" means the City of Muskego, Wisconsin, a
municipal corporation and political subdivision.
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"Municipality Representative" means the Mayor", the City
Clerk/Treasurer or such other officer of the Municipality as is
appointed by the Common Council to act on behalf of the
Municipality under this Agreement.
"Owner" or "Owners" means, with respect to the Bonds when
in book-entry-only form, the beneficial owner or owners of the
Bonds.
"Project" means the program of blight elimination,
community development and urban renewal to be carried out by the
Authority in the Redevelopment Project Area as described in the
Redevelopment Plan, consisting of public improvements and
project costs listed in the Project Plan for Tax Incremental
District No.9, and related costs.
"Property" means the real estate described in Exhibit A
hereto.
"Quiet Enjoyment" means the right of the Municipality to
peaceably and quietly have, hold and enjoy the Leased Property
and to use the Leased Property for the purposes intended or
permitted by this Agreement.
"Redevelopment plan" means the redevelopment plan adopted
in connection with the Redevelopment Project Area pursuant to
Section 66.1333 of the Wisconsin Statutes;
"Redevelopment Project Area" means the redevelopment
project area created by the Authority under Section 66.1333 of
the Wisconsin Statutes designated "Redevelopment District No. I"
within the boundaries of Tax Incremental District No.9 of the
Municipality;
"Rentals" means the rentals payable by the Municipality
pursuant to Section 3.2(a) hereof.
"Reserve Account" means the Reserve Account established for
the Bonds pursuant to the Resolution.
"Reserve Requirement" means the Reserve Requirement as
defined in the Resolution.
"Resolution" means the resolution authorizing the issuance
of the Bonds adopted by the Authority on , 2003.
Section 1.2 Use of Phrases. The following provisions
shall be applied whenever appropriate herein:
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"Herein", "Hereby", "hereunder", "hereof" and other
equivalent words refer to this Agreement as an entirety and not
solely to the particular portion of this Lease in which any such
word is used.
The definitions set forth in Section 1.1 hereof shall be
deemed applicable whether the words defined are herein used in
the singular or the plural.
Wherever used herein, any pronoun or pronouns shall be
deemed to include both the singular and the plural. and to cover
all genders.
Unless otherwise provided, any determinations or reports
hereunder which require the application of accounting concepts
or principles shall be made in accordance with generally
accepted accounting principles.
ARTICLE II
COMPLETION OF THE PROJECT
The Municipality agrees that it will make all contracts and
do all things necessary to cause the Project to be constructed'
and equipped, acting in the name of and for the Authority as
holder of title to the Leased Property. Title to the Leased
Property and all equipment acquired with proceeds of the Bonds
and all fixtures thereto shall be held by the Authority, subject
to this Lease.
The Municipality agrees that in order to effectuate the
purposes of this Lease, it will make, execute, acknowledge and
transmit any contracts, orders, receipts, writings and
instructions with any other persons, firms or corporations. and
in general do all things which may be requisite or proper, all
for the construction and equipping of the Project, acting for
the Authority as holder of title to the Leased Property. So
long as this Lease is in full force and effect, the Municipality
shall have full power to carry out the acts and agreements
provided in this Section, and such power is granted and
conferred under this Lease to the Municipality, and is accepted
by the Municipality and shall not be terminated or restricted by
act of the Authority or the Municipality, except as provided in
this Section.
The Municipality agrees to construct the Project, acting in
the name of and for the Authority as holder of title to the
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Leased Property, through the application of moneys. to be
disbursed from the Construction Funds.
The Authority hereby assigns to the Municipality all .its
rights and power to enforce in the name of the Municipality or
the name of the Authority such purchase orders or contracts as
are required for the completion of the Project which enforcement
may be at law or in equity; provided however, that the
assignment made by the Authority herein shall not prevent the
Authority from asserting said rights and powers in its own
behalf or on behalf of the owners of the Bonds; and provided
further that upon request the Authority shall cooperate with the
Municipality at the Municipality's expense in enforcing any such
purchase orders or contracts.
The Authority shall not be responsible for, nor shall it
pay, more than the proceeds from the sale of the Bonds together
with any income or gain thereon resulting from investments of
such amount for the completion of the Project.
ARTICLE III
TERM AND RENTS
section 3.1 Term. The term of the Lease pursuant to this
Agreement shall commence as of this day of ,
2003. This Agreement shall expire on , 20--, unless the
parties shall sooner terminate this Agreement by mutual
agreement; provided, however, that the end of said term shall
not be advanced nor shall this Agreement expire or be terminated
so long as the Bonds shall be outstanding; provided, further,
that when the Authority shall have fully paid (or provided for
the payment of) all of the principal and interest on the Bonds,
this Agreement shall automatically terminate.
Section 3.2 (a) Rentals. During the Leasehold Term the
Municipality agrees to pay to the Fiscal Agent for the
Authority, without deduction or offset (except as described in
the following paragraph), rental payments ("Rentals")
semi-annually on 1 and .
1 of each year commencing
. on The rental payable on any date shall be
an amount equal to the sum of the following:
(1) The amount of principal payable on the Bonds on the
next succeeding payment date for the Bonds, whether such
principal is payable at maturity or upon mandatory redemption;
and
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(2) The amount of interest payable on the Bonds on the
next succeeding payment date for the Bonds.
The schedule of principal and interest payments on the
Bonds is shown on Exhibit C attached hereto and incorporated by
this reference.
The amount of any Rental payable by the Municipality shall
be reduced by the amount of investment earnings, contributions
by the Municipality and other monies on deposit in the Debt
Service Fund for the Bonds (excluding monies on deposit in the
Reserve Account) .
. (b) Additional Rentals. If, during the Leasehold Term,
the amount on deposit in the Reserve Account for the Bonds falls
below the Reserve Requirement, the Municipality agrees to pay to
the Fiscal Agent for the Authority, without deduction or offset
(except as described in the following paragraph), additional
rental payments ("Additional Rentals") monthly on the first day
of each month until the Reserve Requirement is again on deposit
in the Reserve Account. The Additional Rental payable on any
date shall be 1/6 of the amount initially required to make the
amount on deposit in the Reserve Account equal to the Reserve
Requirement.
The amount of any Additional Rental payable by the
Municipality shall be reduced by the amount of investment
earnings, contributions by the Municipality or other monies
deposited into the Reserve Account.
The Additional Rentals shall become payable upon receipt by
the Municipality of notice of a deficiency in the Reserve
Account.
The obligation of the Municipality to pay Rentals and. Additional Rentals is conditioned upon (a) the Municipality's
"Quiet Enjoyment" of the Leased Property and (b) annual
appropriation of the rental payment by the Municipality. The
parties acknowledge that the Leased Property is being leased at
its fair market value.
Section 3.3 Debt Service on Bonds. The Authority
covenants and agrees that the Rentals payable hereunder shall be
used only to pay the principal of and interest on the Bonds, as
provided in the Resolution and that no Rentals shall be used to
pay operating expenses of the Authority.
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. The Authority covenants and agrees that the Additional
Rentals payable hereunder shall be used only to replenish the
Reserve Accounts.
Section 3.4 Payment of Costs and Expenses. If the
Municipality defaults under any provisions of this Agreement and
'the Authority employs attorneys or incurs other expenses for the
collection of payments due or for the enforcement of performance
or observance of any other obligation or agreement on the part
of the Municipality herein contained, the Municipality agrees
that it will on demand therefor pay to the Authority the
reasonable fees of such attorneys and such other reasonable
expenses so incurred by the Authority.
Section 3.5 Not Debt. Notwithstanding anything to the
contrary herein contained by implication or otherwise, the
obligations of the Municipality created by or arising out of
this Agreement shall not be general debt obligations of the
Municipality and do not constitute or give rise to charges
against its general credit or taxing powers.
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Section 3.6 Repairs and Maintenance. The Municipality
covenants and agrees throughout the Leasehold Term to maintain
the Leased Property and keep the same in as good order and
condition as the same are in upon the effective date of this
Agreement.
Section 3.7 Utilities. The Municipality agrees to payor
cause to be paid all charges for gas, electricity, light, heat
or power, telephone or other communication service, or any other
service used, rendered or supplied upon or in connection with
the Leased Property during the Leasehold Term and to protect the
Authority and save it harmless against any liability or damages
on such account. The Municipality shall also procure any and
~ll necessary permits, licenses or other authorizations
thereafter required for the lawful and proper installation and
maintenance upon,the Leased Property of wires, pipes, conduits,
tubes and other equipment and appliances for use in supplying
any such services to and upon the Leased Property.
Section 3.8 Prepayment. The Authority authorizes the
Municipality, in its stead, to call the Bonds for redemption
prior to maturity, in whole or in part, pursuant to the terms
and conditions of the Resolution, provided that the Municipality
shall prepay its Rentals hereunder so that the Rentals suffice
to pay the principal of, premium, if any, and interest on the
Bonds due at the time of redemption. The Municipality agrees
that it shall not make any prepayments of Rentals due under this .
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Lease without calling for redemption the applicable Bonds,
without the consent of the Authority.
Section 3.9 Pledge and Assignment to Fiscal Agent.
Simultaneously with the delivery of this Lease, the Authority
shall pledge and assign to the Fiscal Agent all of the
. Authority's right, title and interest in and to this Lease
Agreement and all of the Authority's right to receive payments
hereunder. The Municipality consents to such pledge and
assignment and agrees that the Fiscal Agent enforce any and all
rights, privileges and remedies of the Authority under or with
respect to this Lease.
ARTICLE IV
COVENANTS OF MUNICIPALITY
Section 4.1 Restriction on Use. The Municipality
covenants that the Leased Property shall be used for public
purposes. The Authority covenants and agrees that the Leased
Property shall be and remain open to and available for public
use ro the same extent and in the same manner as if the Leased
Property were owned by the Municipality. The Municipality and
the Authority agree that, during the term hereof, no portion of
the Leased Property shall be sold to a private party for an
amount which would cause the Bonds to become "private activity
bonds" under the provisions of the Internal Revenue Code and the
regulations promulgated thereunder.
Section 4.2 Public Liability Insurance. The Municipality
shall ~aintain or cause to be maintained during the Leasehold
Term general public liability insurance against all claims for
personal injury, death or property damage for which any of the
parties might be liable, occurring upon, in or about the Leased
Property or any buildings, facilities, sidewalks, streets and
passageways, therein or thereon; such insurance to afford
protection to the parties to the limit of not less than
$1,000,000 per occurrence and $1,000,000 in aggregate per year
in respect of personal injury and death and property damage, or
such other limits as may be mutually agreed upon.
Section 4.3 Hazard Insurance. (a) The Municipality shall
cause any structures that are part of the Leased Property to be
continually insured during the Leasehold Term against damage or
destruction by fire, windstorm and any other loss or damage
customarily insured in comparable structures in an amount equal
to the replacement value of the property.
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(b) In case of damage, loss or destruction of the Leased
Property, or any part thereof, or any lost fixtures or equipment
thereof during the Leasehold Term, the proceeds of' any insurance
which pertains to such premises, fixtures and equipment shall be
used and applied by the Municipality as promptly as possible to
repair, restore, rebuild or replace the same as nearly as
possible to the condition existing prior to such damage, loss or
destruction.
(c) In consideration of the provisions of this Agreement
giving and granting to the Municipality exclusive possession,
custody and control of the Leased Property, the Municipality
hereby assumes all risks during the Leasehold Term in connection
with any damage, loss or destruction of the Leased Property, or
any part thereof, or any fixtures or equipment thereof from any
and all causes whatsoever, and, in the event of any such damage;
loss or destruction, the Municipality covenants and agrees to
repair, restore, rebuild or replace the same as nearly as
possible to the condition they were in immediately prior to such
damage, loss or destruction either from the proceeds of
insurance as hereinabove in this Section 4.3 provided, or, to
the extent such proceeds of insurance are insufficient or
unavailable therefor, from available appropriations of moneys
derived from other sources.
Section 4.4 Compliance with Laws and Regulations. The
Municipality agrees that throughout the Leasehold Term it will
promptly comply with all laws and ordinances and the orders,
rules, regulations and requirements of all federal, state and
local governments and agencies and departments thereof which are
applicable to the Municipality and the Leased Property, and
whether or not the same requires structural repairs or
alterations, which may be applicable to the Leased Property, the
fixtures or equipment thereof, or the sidewalks, curbs and
parking areas adjoining the demised premises, or the use or
manner of use of the Leased Property. The Municipality will
also observe and comply with the requirements of all policies
and arrangements of insurance at any time in force during the
Leasehold Term of this Agreement with respect to the Leased
Property and the fixtures and equipment thereof.
Section 4.5 Alterations and Additions to Leased Property.
The Municipality shall have the right at any time and from time
to time during the Leasehold Term, without liability to the
Authority, to make such changes, alterations and additions,
structural or otherwise, to the Leased Property and any fixtures
and equipment thereof, now or hereafter located on the Leased
Property, as the Municipality shall deem necessa+y or desirable
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in connection with the use of the, Leased Property. All such
changes, alterations and additions when completed shall be of
such a character as not to reduce or otherwise adversely affect
the value of the Leased Property or the rental value thereof.
The cost of any such change, alteration or addition shall be
promptly paid and discharged so that the Leased Property shall
at all times be free of liens for labor and materials supplied
to the Leased Property, provided, however, that the Municipality
may in good faith contest any lien if adequate security is
provided during the pendency of proceedings so that the Leased
Property is not in danger of being lost through lien foreclosure
or otherwise. All alterations, additions and improvements to
the Leased Property shall be and become a part of the realty
covering the Leased Property.
Section 4.6 Covenants Against Waste. The Municipality
covenants during the term of the Lease not to do or suffer or
permit any waste or damage, disfigurement or injury to the
Leased Property or any building or improvement now or hereafter
on the Leased Property or the fixtures or equipment thereof.
Section 4.7 Municipal Budget; Consequences of Non-
Appropriation. The Municipality hereby covenants that its staff
will include the Rentals and Additional Rentals to become due
hereunder in its annual budget as submitted to the Common
Council of the Municipality for approval during each year of the
Leasehold Term, and further covenants that its staff will
request the necessary appropriation from the Common Council and
will exhaust all available administrative reviews and appeals in
the event that portion of the budget is not approved. The
Municipality reasonably believes, expects and intends that funds
will be budgeted and appropriated sufficient to make all
payments of Rentals and Additional Rentals during the term of
this Lease Agreement.
If the Common Council of the Municipality in any year does
not budget and appropriate the Rentals and Additional Rentals to
become due during the next succeeding year, the Municipality
will provide written notice to that effect to the Authority, to
the Fiscal Agent and to , the original
purchaser of the Bonds (the "Purchaser"), no later than 15 days
after adoption and approval of that annual budget. This Lease
Agreement shall terminate 30 days after notice of any non-
appropriation has been given by the Municipality to the
Authority, and the Municipality shall, upon such termination,
peacefully quit, surrender and deliver up'to the Authority, its
successors or assigns, the Leased Property in good condition,
ordinary wear and tear excepted. Upon such termination, in the
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event any of the Leased Property has become lost, stolen,
destroyed, damaged beyond repair or rendered permanently unfit
for use for any reason, the Municipality shall repair or replace
such Leased Property at the Municipality's sole cost prior to
surrender of the Leased Property to the Authority, with said
repair or replacement subject to the Authority's reasonable
approval.
The Municipality will also, whether or not the Rentals and
Additional Rentals due under this Agreement are budgeted and
appropriated, furnish the Authority, the Purchaser and the
Fiscal Agent with a copy of its annual budget within 15 days of
its adoption. All obligations of the Municipality arising under
this Lease Agreement during the Municipality's occupancy of the
Leased Property shall survive this Lease Agreement.
Section 4.8 Tax Covenant. The Municipality and the
Authority covenant for the benefit of the Owners of the Bonds
that they will not take any action or omit to take any action
with respect to the Bonds, the proceeds thereof, any other funds
of the Municipality and the Authority or any facilities financed
with the proceeds of the Bonds if such action or omission
(i) would cause the interest on the Bonds to lose its exclusion
from gross income for federal income tax purposes under
Section 103 of the Code and applicable Regulations, or
(ii) would cause interest on the Bonds to lose its exclusion
from alternative minimum taxable income as defined in Section
55 (b) (2) of the Code except to the extent such interest is
required to be included in the adjusted current earnings
adjustments applicable to corporations under Section 56 of the.
Code in calculating corporate alternative minimum taxable
income, or (iii) would subject the Municipality or the Authority
to any penalties under Section 148 of the Code. The foregoing
covenant shall remain in full force and effect, notwithstanding
the payment in full or defeasance of the Bonds, until the date
on which all obligations of the Municipality and the Authority
in fulfilling the above covenant under the Code have been met.
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ARTICLE V
ASSIGNMENT, SUBLETTING AND MORTGAGING
section 5.1 Assiqnment and Subleasing by the Municipality.
This Lease may not be assigned by the Municipality for any
reason. However, the Leased Property may be subleased, as a
whole or in part, by the Municipality without the necessity of
obtaining the consent of the Authority, subject, however, to
each of the following conditions:
(a) The Leased Property may be subleased, in whole or in
part, only to an agency or department or political subdivision
of the State; or to another entity or entities if,' in the
opinion of nationally recognized municipal bond counsel, such
sublease will not cause the Municipality to violate its tax
covenant in Section 4.8 hereof;
(b) This Lease, and the obligations of the Municipality
hereunder, shall at all times during the Leasehold Term remain
obligations of the Municipality, and the Municipality shall
maintain its direct relationships with the Authority
notwithstanding any sublease;
(c) The Municipality shall furnish or cause to be
furnished to the Authority a copy of any sublease agreement; and
(d) No sublease by the Municipality shall cause the Leased
Property to be used for any purpose which would cause the
Municipality to violate its tax covenant in Section 4.8 hereof.
Except as permitted in this Section 5.1, so long as the
Bonds are outstanding, neither the Authority nor the
Municipality shall mortgage, assign or pledge its interests in
the 'Leased Property or any rentals payable with respect thereto.
Section 5.2 Priority of Lease, No sublessee or assignee
of the Leased Property shall mortgage, assign or pledge its
interest iri the Leased Property or any rentals payable with
respect thereto unless such mortgage, assignment or pledge shall
be subordinate to this Agreement.
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ARTICLE VI
CONDITIONS OF LEASE
Section 6.1 Merger of Interest. It is mutually agreed by
the parties hereto that so long as the Bonds are outstanding,
the leasehold interest and estate created by this Agreement
shall not be merged or deemed to be merged with any reversionary
, interest and estate of the Municipality in the Leased Property.
~ection 6.2 Right to Inspect. The Municipality covenants
and agrees during the Leasehold Term to permit the Authority and
the authorized agents and representatives of the Authority or
the owners of the Bonds to enter the Leased Property at all
times during usual business hours for the purpose of inspecting
the same.
Section 6.3 Character of Lease. It is mutually agreed
that the Lease granted under this Agreement is an absolutely
"net" lease and notwithstanding any language herein to the
contrary, it is intended and the Municipality expressly
covenants and agrees that all rentals and other payments herein
required to be made by the Municipality to the Authority shall
be made without notice or demand and without set-off,
counterclaim, abatement, suspension, deduction or defense, and
shall be net payments to the Authority, meaning that the
Authority is not and shall not be required to expend any money
or do any acts or take any steps affecting or with respect to
the maintenance, preservation, repair, restoration,
reconstruction, insuring or protection of the Property or any
part thereof, all such obligations being the responsibility of
the Municipality.
Section 6.4 Condition of Premises. The Municipality,
prior to the occupancy thereof, and at all times thereafter,
shall fully familiarize itself with the physical condition of
the Property and any improvements, fixtures and equipment
thereof. The Authority makes no representations whatever in
connection with the condition of the Property or the
improvements, fixtures or equipment thereof, and the Authority
shall not be liable for any latent or patent defects therein.
Section 6.5 Consent to Suit. The Municipality hereby
consents and agrees to the institution of any and ~ll actions,
including mandamus, against the Municipality or any of its
officers which may arise out of this Agreement and, to the
extent permitted by law, the Municipality waives resort prior to
the bringing of any such action by the Authority, as lessor
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. hereunder, or its assignees to any administrative claim
procedure provided in the Wisconsin Statutes.
Section 6.6 Enjoyment of Property. The Authority hereby
covenants that the Municipality shall during the Leasehold Term
peaceably and quietly have and hold and enjoy the Property
without suit, trouble or hindrance from the Authority, except as
expressly required or permitted by this Lease. The Authority
shall not interfere with the quiet use and enjoyment of the
Property by the Municipality during the Leasehold Term so long
as no event of default shall have occurred under the Lease. The
Authority shall, at the request of the Municipality and at the
cost of the Municipality, join and cooperate fully in any legàl
action in which the Municipality asserts its right. to such
possession and enjoyment. In addition, the Municipality may at
its own expense join in any legal action affecting its
. possession and enjoyment of the Property and shall be joined in
any action, affecting its liabilities hereunder.
Section 6.7 Transfer of Title. Upon full and final
payment of all Bonds (or if all Bonds shall, prior to maturity
or redemption date thereof, have been discharged within the
meaning of the Resolutions) and of all amounts due under this
Lease Agreement, .
(a) this Lease Agreement shall terminate and neither
the Municipality nor the Authority nor any Owner of the
Bonds shall thereafter have any rights hereunder, saving
and excepting those that shall have theretofore vested; and
(b) title to the Leased Property shall, without any
further payment, be transferred to the Municipality, and
the Authority shall execute any document of conveyance
reasonably requested by the Municipality to evidence such
transfer.
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ARTICLE VII
MISCELLANEOUS
Section 7.1 Amendments. No modification, alteration or
amendment to this Agreement shall be binding upon either party
hereto until such modification, alteration or amendment is
reduced to writing and executed by both parties hereto.
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Section 7.2 Successors. Except as limited or conditioned
by the express provisions hereof, the provisions of this
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agreement shall inure to the benefit of and be binding upon the
successors and assigns of the parties hereto.
Section 7.3 Governing Law. The laws of the State of
Wisconsin shall govern this Agreement.
Section 7.4 Captions. The captions
Agreement are for convenience only and in
or describe the scope or intent of any of
Agreement.
or headings in this
no way define, limit
the provisions of this
Section 7.5 Counterparts. This Agreement may be signed in
any number of counterparts with the same effect as if the
signatures thereto and hereto were on the same instrument.
Section 7.6 Notices. All notices, certificates or other
communications hereunder shall be sufficiently given and shall
be deemed given when hand delivered or when mailed by certified
or registered mail, postage prepaid, or by prepaid telegram
addressed as follows:
If to the Municipality:
City of Muskego
Attention: City Clerk/Treasurer
W182 S8200 Racine Avenue
Muskego, WI 53150
If to the Authority:
Community Development Authority of the City
Attention: Executive Director/Secretary
W182 S8200 Racine Avenue
Muskego, WI 53150
of Muskego
If to the Purchaser:
If to the Fiscal Agent:
Either party may by like notice at any time, and from time to
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time, designate a different address to which notices shall be
sent. Notices given in accordance with these provisions shall
be deemed received when mailed.
Section 7.7 Severability. If any provisions of this
Agreement shall be held or deemed to be or shall, in fact, be
inoperative or unenforceable as applied in any particular case
in any jurisdiction or jurisdictions or in all jurisdictions, or
in all cases because it conflicts with any other provisions or
provisions hereof or any constitution or statute or rule of
public policy, or for any other reason, such circumstance shall
not have the effect of rendering the provision in question
inoperative or unenforceable in any other case or 'circumstance,
or of rendering any other provision or provisions herein
contained invalid, inoperative, or unenforceable to any extent
whatever. The invalidity of anyone or more phrases, sentences,
clauses or Sections in this Agreement contained, shall not.
affect the remaining portions of this Agreement, or any part
thereof.
Section 7.8 No Waivers. Failure of the Authority or the
Municipality to exercise its rights in connection with any
breach or violation of any term, covenant or condition herein
contained shall not be deemed to be a waiver of such term,
covenant or condition for any subsequent breach of the same or
any other term, covenant or condition herein contained. The
subsequent acceptance of rent hereunder by the Authority shall
not be deemed to be a waiver of any preceding breach by the
Municipality of any term, covenant or condition of this
Agreement, other than the failure of the Municipality to pay the
particular rental so accepted, regardless of the Authority's
knowledge of such preceding breach at the time of acceptance of
such rent.
Section 7.9 Recording. Either party hereto may record
this Lease Agreement, or a memorandum or short form hereof,
executed by both of such parties, in the office of the Registrar
of Deeds for Waukesha County, Wisconsin.
Section 7.10 No Personal Liability. Under no
circumstances shall any officer, elected official or employee of
the Municipality or the Authority have any personal liability
arising out of this Lease Agreement, nor shall any party seek or
claim any such personal liability.
Section 7.11 Beneficiaries of Agreement. This Agreement
has been entered into by the Municipality and the Authority for
the benefit of the Municipality, the Authority and the Owners of
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the Bonds, and is not revocable by the Municipality or the
Authority prior to the payment in full of the Bonds. This
Agreement shall be binding upon and inure to the benefit of the
Municipality and the Authority and shall constitute a third
party beneficiary contract for the benefit of the Owners of the
Bonds. Nothing in this Lease Agreement expressed or implied is
intended or shall be construed to give any person other than the
Municipality, the Authority and the Owners of the Bonds, any
legal or equitable right, remedy or claim under or in respect to
this Agreement or any covenants, conditions or provisions
therein or herein contained; all such covenants are for the sole
an~ exclusive benefit of the Municipality, the Authority and the
Owners of the Bonds.
IN WITNESS WHEREOF, the City of Muskego, Wisconsin, has
caused these presents to be executed by its Mayor and City
Clerk/Treasurer and its seal affixed, and the Community
Development Authority of the City of Muskego has caused these
presents to be executed by its Chairperson and Executive
Director/Secretary, all as of the day and year first hereinabove
set forth.
CITY OF MUSKEGO, WISCONSIN
By
(SEAL) Mayor
And
City Clerk/Treasurer
COMMUNITY DEVELOPMENT AUTHORITY OF
THE CITY OF MUSKEGO
By
Chairperson
Attest
Executive Director/Secretary
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STATE OF WISCONSIN
COUNTY OF WAUKESHA
)
) SS
)
On the ----
day of , 2003, before me, a Notary
Public in and for said County, personally appeared Mark A.
Slocomb and Jean K. Marenda, the Mayor and City Clerk/Treasurer,
respectively, of the abòve-named City of Muskego, a Wisconsin
municipal corporation, to me known to be the persons who
executed the foregoing instrument and known to me to be such
Mayor and City Clerk/Treasurer of said municipal corporation,
and acknowledged that, they executed the foregoing instrument as
such officers; that they know the seal of said municipal
corporation; that the seal affixed to said instrument is the
seal of said municipal corporation; that said instrument was
signed and sealed on behalf of said municipal corporation by
authority of its governing body pursuant ,to resolution passed
and approved; and that said persons severally acknowledged the
'execution of said instrument to be the free and voluntary act
and deed of said municipal corporation by it being freely and
voluntarily executed.
IN WITNESS WHEREOF, I have hereunto set my hand and
official seal.
Name (Printed):
Notary Public
My Commission:
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County, Wisconsin
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STATE OF WISCONSIN )
) SS
) COUNTY OF WAUKESHA
On the day of , 2003, before me., a Notary
Public in and for said County, personally appeared
and , the Chairperson
and Executive Director/Secretary, respectively, of the Community
Development Authority of the City of Muskego, a Wisconsin
municipal corporation, to me known to be the persons who
executed the foregoing instrument and to me known to be such
Chairperson and Executive Director/Secretary of said Authority,
and acknowledged that they executed the foregoing instrument as
such officers; that said instrument was signed by them as such
officers of and on behalf of said Authority by authority of its
Commissioners; and the said Authority acknowledged the execution
of said instrument to be the free and voluntary act and deed of
said Authority by"it being freely and voluntarily executed~
IN WITNESS WHEREOF, I have hereunder set my hand and
official seal.
Name (Printed):
Notary Public
County, Wisconsin
My Commission:
This document was drafted by:
Rebecca A. Speckhard
Quarles & Brady LLP
411 East Wisconsin Avenue
Milwaukee, WI 53202
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. EXHIBIT A
LEGAL DESCRIPTION OF PROJECT PROPERTY
The"municipal property dedicated for public
road purposes located within the
Redevelopment Project Area.
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. EXHIBIT B
DESCRIPTION OF LEASED IMPROVEMENTS
All municipally owned sewer mains and
laterals, water mains and laterals, storm
sewer pipes, and related appurtenances and
equipment located or to be located within
the Redevelopment Project Area.
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. EXHIBIT C
SCHEDULE OF DEBT SERVICE PAYMENTS ON THE BONDS
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(SEE ATTACHED)
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. City of Muskego
Preliminary Sale Details
2,000,000 CDA Lease Revenue Bonds
Dated: 6/1103
First Interest: 12/1/03
Maturities
(6-1-)
Principal Interest Total
143,750 143,750 Capitalized
2004 0 287,500 287,500 Capitalized
2005 0 287,500 287,500 Capitalized
2006 0 287,500 287,500
2007 75,000 278,875 353,875
2008 85,000 266,944 351,944
2009 100,000 253,000 353,000
. 2010 100,000 238,625 338,625
2011 100,000 224,250 324,250
2012 110,000 208,725 318,725
2013 120,000 191,763 311,763
2014 130,000 173,363 303,363
2015 140,000 153,525 293,525
2016 150,000 132,250 282,250
2017 160,000 109,538 269,538
2018 170,000 85,388 255,388
2019 175,000 60,375 235,375
2020 185,000 34,069 219,069
2021 200,000 5,750 205,750
2022 0
Total 2,000,000 3,422,688 5,422,688
Call: 6/1/13
Minimum Bid: 1,975,000
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. EXHIBIT D
Contribution and Cooperation Agreement
(see attached)
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CONTRIBUTION AND COOPERATION AGREEMENT
THIS AGREEMENT made and entered into this day of
, 2003, by and between the Community Development
Authority of the City of Muskego, Wisconsin (the "Authority")
and the City of Muskego, Wisconsin (the "City") witnesseth:
WHEREAS, the Authority was created by the Common
Council of the City pursuant to the provisions of Section
66.1335, Wisconsin Statutes (the "Act"); and
WHEREAS, under the provisions of the Act, community
development authorities have the power to purchase real property
necessary or incidental to a redevelopment project; to lease,
sell or otherwise dispose of the same in accordance with a
redevelopment plan; and to issue bonds and other forms of
indebtedness; and
WHEREAS, the Authority proposes to finance a program
of blight elimination, community development and urban renewal
in a redevelopment project area under Section 66.1333, Wisconsin
Statutes designated "Redevelopment District No.1" within the
boundaries of Tax Incremental District No.9 as described in the
redevelopment plan for the area, consisting of public
improvements and project costs listed in the Project Plan for
Tax Incremental District No.9, and related costs (collectively,
the "Project"); and
WHEREAS, the Authority intends to issue $
Community Development Lease Revenue Bonds (the "Bonds") to
provide funds to finance a portion of the cost of the Project;
and
WHEREAS, the Authority has requested that the City
assist in providing additional support to facilitate the.
marketing of the Bonds; and
WHEREAS, the Project and the issuance of the Bonds
will assist the Authority in carrying out the purposes for which
it was created.
NOW, THEREFORE, in consideration of the premises and
the mutual promises of the City and the Authority hereinafter
set forth, the City and the Authority do hereby agree and
covenant as follows:
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ARTICLE I
COVENANTS OF THE AUTHORITY
Section 1.1. The Authority will proceed with all
possible diligence to accomplish the financing of the Project
through the issuance of the Bonds.
Section 1.2. The Authority will provide access to all
of its books and records relating to the Bonds to the City's
financial officials, or their designees, during the normal
business hours of the Authority. Upon request, said officials
or designees shall be permitted to make copies of said books and
records, or any portions thereof.
ARTICLE II
COVENANTS OF THE CITY
Section 2.1. The Authority at the time of the
delivery of the Bonds will fund from Bond proceeds a Reserve
Account. If, at any time, the balance in the Reserve Account
. for the Bonds falls below the Reserve Requirement as defined in
the resolution of the Authority authorizing the issuance of the
Bonds (the "Reserve Requirement"), the City covenants that it
will pay to the Authority an amount sufficient to restore the
Reserve Account to the Reserve Requirement. For the purpose of
determining the balance in the Reserve Account, investments held
therein shall be valued at cost plus interest accrued thereon.
Section 2.2. On or before November 1 of each year the
Authority will file with the City Clerk/Treasurer and
, the original purchaser of the Bonds,
the Authority's estimate of the amount of the City's obligation
under Section 2.1 of this Agreement during the next succeeding
fiscal year, and the staff of the City will include such amount
in the City budget as submitted to the Common Council for the
next succeeding fiscal year. If the Common Council in any year
does not budget and appropriate the amount of the City's
obligation as .estimated by the Authority, the City will provide
written notice to that effect to the Authority, to' the Fiscal
Agent for the Bonds, and to
no later than 15 days after adoption
and approval of the annual budget for that year.
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At any time that the balance in the Reserve Account
falls below the Reserve Requirement, the Authority will file
with the City Clerk/Treasurer its written claim for the amount
due to the Authority hereunder, which claim shall be processed
pursuant to Section 62.12(8) of Wisconsin Statutes or any
successor thereto then in effect.
Within 30 days of receipt of a claim from the
Authority, the City will pay to the Authority the full amount of
its obligation out of any funds available and appropriated by
the Common Council for that purpose.
Any payment by the City pursuant to Section 2.1 shall
be a donation in assistance of the Authority, and the Authority
shall not be liable for any repayment thereof.
Section 2.3. The City will not dissolve Tax Incremental
District No.9 of the City unless and until all of the Bonds
have been paid or have been discharged within the meaning of the
resolutions adopted by the Authority authorizing the issuance of
the Bonds.
ARTICLE III
OTHER PROVISIONS
Section 3.1. This Agreement is made for the benefit
of the City, the Authority and the owner or owners of the Bonds,
and any payments receivable hereunder by the Authority from the
City may be pledged and assigned by the Authority as security
for the payment of the principal of and interest on the Bonds.
This Agreement shall constitute a third party beneficiary
contract for the benefit of the beneficial owner or owners of
the Bonds.
Section 3.2. This Agreement shall not be abrogated,
amended, modified or supplemented at any time when any Bonds are
outstanding and unpaid, without the consent of the owners of all
of the Bonds which are outstanding and have not been discharged,
except that this Agreement may be amended without the consent of
the owners of any of the Bonds in order to meet the requirements
of the resolution authorizing the issuance of the Bonds relating
to the issuance of additional parity bonds. .
Section 3,3. This Agreement shall not have any effect
whatsoever, and shall be absolutely void, unless and until the
Bonds have been issued, sold and delivered.
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Section 3.4 Simultaneously with 'the delivery of this
Agreement, the Authority shall pledge and assign to the Fiscal
Agent for the Bonds all of the Authority's right, title and
interest in and to this Agreement and all of the Authority's
right to receive payments hereunder. The City consents to such
pledge and assignment and agrees that the Fiscal Agent enforce
any and all rights, privileges and remedies of the Authority
under or with respect to this Agreement.
Section 3.5. In case any section, subsection or
clause of this Agreement shall be held invalid, the invalidity
thereof shall not affect any other portion of this Agreement and
all other portions of this Agreement shall nevertheless be in
full force and effect.
IN WITNESS WHEREOF, the City and the Authority have
respectively caused this Agreement to be duly executed as of the
day and year first above written.
CITY OF MUSKEGO, WISCONSIN
By:
Mayor
(SEAL)
City Clerk/Treasurer
COMMUNITY DEVELOPMENT AUTHORITY OF
THE CITY OF MUSKEGO, WISCONSIN
By:
Chairperson
Executive Director/Secretary
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