…title
ITEM: SIXTH AMENDMENT TO PURCHASE AND SALE AGREEMENT WITH WELLINGTON PROPERTY OWNER LLC AND APPROVAL OF TERMINATION OF PURCHASE AND SALE AGREEMENT WITH EIM
REQUEST: Approval of Sixth Amendment to the Purchase and Sale Agreement with Wellington Property Owner LLC and approval of termination of Purchase and Sale Agreement with EIM.
…body
EXPLANATION: The PSA with Wellington Property Owner, LLC includes an option for Wellington Property Owner to purchase the School Parcel in the event the EIM PSA is terminated. Although EIM, n/k/a Founders Acreage Wellington LLC, continues to make good progress toward its fundraising goal, there are concerns that EIM may not reach its fundraising goals within the time periods required for Closing. To mitigate that concern, Wellington Property Owner has agreed to purchase the school parcel on behalf of EIM.
The Sixth Amendment provides for the following:
1. Increases the Wellington Property Owner purchase price to $46,294,853.61, with $28,342,848.00 being paid for the Mixed Use Parcel and $17,952,005.61 being paid for the School Use Parcel.
2. Assigns the EIM deposit in the amount of $903,000.00 plus accrued interest currently being held by the Escrow Agent to Wellington Property Owner, LLC.
3. Revises the reference and legal descriptions to the parcels in the PSA.
4. Provides for a pre-closing boundary plat in order to establish the various parcels that would comprise the School Use Parcel and the Mixed Use Parcel.
5. Maintains the requirement that the Mixed Use Parcel shall be used only for mixed use and the School Use Parcel shall be used only for a non-sectarian educational use.
6. Provides for the ability for Wellington Property Owner to either purchase both parcels simultaneously or have two (2) phases of closing, with the first closing being the Mixed Use Parcel and the second closing being the School Use Parcel. If Wellington Property Owner chooses to phase the closings, (i) it would acquire the Mixed Use Parcel and the smaller portion of the School Parcel in Phase I and (ii) have an option to acquire the remaining and larger portion of the School Parcel at a later date. Wellington Property Owner has two remaining options to extend the Approvals Period, having already exercised two of its four options. Upon exhaustion of the Approvals Period under the Agreement, Wellington Property Owner’s ability to “walk away” from the deal will end and it must close on both the Mixed Use Parcel and the School Use Parcel. However, it retains the option to extend the closing date on the School Use Parcel in 30-day increments upon payment of $50,000 per extension. In no event shall closing on the School Use Parcel extend beyond October 21, 2026.
7. Provides that if, during the 10 years following closing, Wellington Property Owner LLC obtains approvals to develop any or all of the School Use Parcel for residential, retail, commercial, and/or hotel use, it will pay an additional $428,571.00 per acre for the property that is so developed. That additional consideration increases each year by a 3% escalation factor.
8. Wellington’s right to repurchase the property will only apply to the Mixed Use Parcel.
9. The Prohibited Uses under the Agreement would apply only to the Mixed Use Parcel. This was specifically negotiated out of the PSA with the school. However, if Wellington Property Owner seeks to amend the Master Plan to permit non-school uses, the Village Council may condition approval of such Master Plan Amendment on adhering to the prohibited uses.
Simultaneously with the execution of the Sixth Amendment, Acme and EIM would execute a termination of the EIM PSA.
BUDGET AMENDMENT REQUIRED: NO
PUBLIC HEARING: NO QUASI-JUDICIAL:
FIRST READING: SECOND READING:
LEGAL SUFFICIENCY: YES
FISCAL IMPACT: NONE
WELLINGTON FUNDAMENTAL: Responsive Government
RECOMMENDATION: Approval of Sixth Amendment to the Purchase and Sale Agreement with Wellington Property Owner LLC and approval of termination of Purchase and Sale Agreement with EIM.