AGREEMENT
This Tax Abatement Agreement (the “Agreement”) dated as of ______, 2014 is an agreement among and between the Town of Windsor Locks, a municipal corporation within the County of Hartford and State of Connecticut (the “Town”) and Algonquin Windsor Locks, LLC (the “Company”), a Connecticut Limited Liability Company, its principal office in Oakville, Ontario, Canada.
WHEREAS, the Company has constructed and is operating anew electric generating facility as completed in 2013 and located at 26 Canal Bank, Windsor Locks, Connecticut (the “Parcel”); and
WHEREAS, the new facility is expected to generate substantial new taxes for the Town; and
WHEREAS, pursuant to Connecticut General Statutes Section 32-71 et seq., as the same may be amended from time to time, the Company’s new electric generating facility may be granted favorable tax treatment so as to provide financial incentives to the Company to operate and maintain the facility within the Town; and
WHEREAS, the Town and the Company wish to enter into an agreement providing for fixing the assessment relating to the newly installed personal property and equipment as reported and shown on the Town’s October 1, 2013 Grand List; and
WHEREAS, the Town and the Company each have full right and lawful authority to enter into this Agreement, subject to the approval by the Legislative Body of the Town;
Now THEREFORE, in consideration of the premises and the mutual covenants hereinafter contained, the parties hereto covenant and agree as follows:
1.01 Obligation of the Company to maintain and operate the facility: The Company represents, covenants, and agrees that the Company has constructed a new electric generation facility (the Facility) within an existing structure located at 26 Canal Bank, Windsor Locks, Connecticut with a reported value of new equipment and personal property in the amount of $18,532,113.00. The Company further covenants and agrees to operate and maintain the Facility and related electric generating equipment for a minimum period of twenty (20) years. The parties acknowledge that, as part of the consideration of this Agreement, the Town has relied upon the foregoing covenants and representations. In the event that the Company fails to maintain and operate the facility and pursuant to this Agreement for a minimum of twenty (20) years, the Town may terminate this Agreement and the Company agrees to rebate any and all amounts abated hereunder within thirty (30) days of termination of this Agreement.
The Town and the Company acknowledge that, in addition to the personal property and equipment subject of this Agreement, the Company may add to and/or expand the type or value of the personalty now existing within the new facility. Nothing in this Agreement shall be construed to apply to the fixing of the assessments with regard to any such future additional personal property or equipment nor to the assessments relating to any property, real or personal, included on any prior Grand List of the Town of Windsor Locks prior to October 1, 2013. Such additional or preexisting property shall beassessed in the normal course pursuant to state and local laws or ordinances.
(b)Governmental Approvals. The Company represents that it has obtained all necessary governmental or regulatory approvals, licenses and permits required to operate an electric generating facility, and is in compliance with all building, zoning, land use, environmental pollution, sanitary, safety and all other governmental or regulatory laws and/or regulations. The Company agrees to continue to comply with all applicable laws, ordinances, and regulations relative to the operation and maintenance of the facility and structure located on the Parcel.
(c)Termination of the Agreement. Notwithstanding anything to the contrary herein, if the Company in good faith determines that it is not economically feasible for the Company to continue its operation of the electric generating facility, either party may, upon (30) days written notice thereof to the other party hereto, terminate this Agreement, provided that if the Company ceases the operations of the facility within twenty (20) years after the signing of this Agreement, the Company shall rebate to the Town any and all amounts abated pursuant to this Agreement. Upon receipt of such payment by the Town, neither the Town nor the Company shall have any further rights or obligations hereunder.
(d)Town Obligations. Other than the obligations with respect to the fixing of the assessments and tax abatements hereunder, the Town shall bear no expenses in connection with the maintenance or operation of the facility. The Company shall assume all responsibility for and bear the cost of defending the provisions of this Agreement against any challenges to the Agreement in consultation with the Town Attorney.
ARTICLE II
ASSESSMENT AND TAX ABATEMENT
2.01 Fixed Assessment Period. (b) For the purposes of this Agreement, there shall be fixed assessment for five (5) consecutive fiscal years commencing the fiscal years of the Town for which a tax list is prepared on October 1, 2013 (the “Fixed Assessment Period”), and the assessed value of the equipment and personalty associated with the facility described herein shall be fixed on the tax list of the Town for each year during the Fixed Assessment Period at Seventy (70%) Percent of the amount reported by the Company for the Grand List of October 1, 2013 or $18,532,113.00, subject to depreciation as determined by the Town’s Assessor in accordance with state and local laws, ordinances and practice.
2.02 Tax Abatement. Taxes owing by the Company to the Town during the Fixed Period based on the fixed assessment provided in Section 2.01 shall be abated in accordance with Schedule A, attached hereto and made a part hereof. Thereafter, taxes shall be computed and paid to the Town by the Company without abatement, and assessment of all property, both real and personal, shall be determined in the normal course pursuant to state and local laws, ordinance and practice
ARTICLE III
DEFAULTS AND REMEDIES
Section 3.01. Defaults and Remedies. Failure by any party to perform any term or provision of this Agreement shall constitute a default under this Agreement unless the party who so fails immediately commences to cure, correct or remedy such failure, and completes such cure, correction or remedy within 60 days of the provision of written notice of such failure to the defaulting party, as provided hereinbelow. During any such period of curing, the party in receipt of such written notice shall not be deemed to be in default.
Any non-defaulting party shall give written notice of default to the party which has failed to perform any term or provision of this Agreement, specifying the failure complained of by the injured party. Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default.
Any party may commence an action for specific performance of the terms of this Agreement pertaining to any default hereunder and may institute legal action to cure, correct or remedy any default, to recover damages for any default, or to obtain any other remedy consistent with the purpose of this Agreement. The laws of the State of Connecticut shall govern the interpretation and enforcement of this Agreement.
ARTICLE IV
MISCELLANEOUS
Section 4.01. Notices. All notices required or permitted by this Agreement shall be in writing, and shall be sent by registered or certified mail, return receipt requested, or by federal express or personal service, shall be deemed given on the date of receipt and shall be addressed, in the case of the Town, to:
Office of the First Selectman
Town of Windsor Locks
50 Church Street
Windsor Locks, CT 06096
with copies to:
Scott A. Storms, Esq.
Storms & Storms
P.O. Box 275
18 Suffield Street
Windsor Locks, CT 06096
and in the case of the Company, to:
TBD
with a copy to:
TBD
or to such other address as shall from time to time be supplied in writing by any party to the other parties hereto.
Section 4.02. Right to Transfer. The obligations of the Town and the Company under this Agreement are continuing obligations which shall survive transfer of all or any portion of the Parcel by the Company to others. In order to perfect any such transfer, the Company shall have the unrestricted right to assign or otherwise transfer its right under this Agreement and/or to transfer all or any portion of the Parcel or any interest therein, to any person, partnership, joint venture, corporation or other entity, at any time. Notwithstanding anything herein to the contrary, the right of transfer set forth in this Section 4.02 shall be subject to the provisions of Section 2.01(b) hereof.
Section 4.03. Interest of Successors. The covenants and agreements herein contained shall injure to the benefit of and be binding upon the parties hereto and their respective successors and assigns.
Section 4.04. Entire Agreement. This Agreement sets forth all (and is intended by the parties hereto to be an integration of all) of the promises, agreements, conditions, understandings, warranties and representations between the parties hereto with respect to the assessment of the Facility’s personal property and equipment and the imposition of property taxes thereon, and there are no promises, agreements, conditions, understandings, warranties or representations, oral or written, express or implied, between them with respect to said assessment and imposition of taxes other than as set forth herein.
Section 4.05. Amendments. This Agreement may not be modified or amended except by a writing signed by each of the parties hereto.
Section 4.06. Section Headings. The section headings in this Agreement are for convenience and for reference only and in no way define or limit the scope or content of this Agreement or in any way affect its provisions.
Section 4.07. Severability. A ruling by any court or administrative body that a portion of this Agreement is invalid or unconstitutional shall have no effect on the other terms hereof which shall remain in full force and effect and binding on the parties hereto.
Section 4.08. Applicable Law. This Agreement shall be interpreted and enforced in accordance with the laws of the State of Connecticut.
Section 4.09. Recording. An executed copy of this Agreement shall be duly recorded by the Town in the Land Records of the Town.
IN WITNESS WHEREOF, the parties have executed this Agreement as of this day first mentioned.
WITNESSETH:TOWN OF WINDSOR LOCKS, CONNECTICUT
______
Steven N. Wawruck, Jr.
First Selectman
______
ALGONQUIN WINDSOR LOCKS, LLC
______
______
STATE OF CONNECTICUT)
) ss: Windsor Locks
COUNTY OF HARTFORD)
On this ______day of ______, 2014, before me, ______, a Commissioner of the Superior Court in and for said State/Notary Public, personally appeared StevenN. Wawruck, Jr. who acknowledged himself to be the First Selectman for the Town of Windsor Locks, Connecticut, and that as such, being authorized to do so by vote of the Town Meeting of ______, 2014, executed the foregoing instrument in his representative capacity for the purposes therein contained by signing his name as the First Selectman of the Town of Windsor Locks, Connecticut, it being his free act and deed and the free act and deed of the Town of Windsor Locks.
AS WITNESS my hand.
______
Commissioner of the Superior Court
)
) ss:
)
On this ______day of ______, 2014, before me, ______, a Commissioner of the Superior Court in and for said State/Notary Public, personally appeared ______, who acknowledged himself/herself to be the ______for Algonquin Windsor Locks, LLC, and that as such, being authorized to do so, executed the foregoing instrument in his/her representative capacity for the purposes therein contained by signing his name as the ______of Algonquin Windsor Locks, LLC, it being his/her free act and deed and the free act and deed of Algonquin Windsor Locks, LLC.
AS WITNESS my hand.
______
Commissioner of the Superior Court
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