Baseball, lease of Port of DbqMEMORANDUM
November 3, 2003
TO:
The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT:
Disposition by Lease of Real Property and Improvements Located in the
Port of Dubuque (Ice Harbor Urban Renewal District) to Riverside
Baseball, LLC
The City of Dubuque has negotiated a 20-year lease for a proposed baseball stadium
for a Class A professional baseball team to be brought to Dubuque from Battle Creek,
Michigan, by the owner of the Iowa Cubs in Des Moines, Michael Gartner. The lease
will be with Riverside Baseball, LLC.
Because the stadium property is located in an urban renewal district, the City must
follow state law regarding urban renewal property disposition. In general, the law
requires that the City may sell or lease property to pdvate persons only under
reasonably competitive bidding procedures. These include an invitation for competing
proposals and a thirty-day public notice of the City's intent to execute any land sale or
lease contract. Additionally, the City must dispose of the property at its fair market
value for uses in accordance with the urban renewal plan.
Accompanying this memorandum is a resolution that initiates the proceedings required
to dispose of the Stadium Property in the Ice Harbor Urban Renewal District to
Riverside Baseball, LLC via lease. In brief, the resolution: 1) agrees to lease the
Stadium Property at not less than fair market value for use by a Class A baseball team;
2) approves minimum requirements for submission of competitive proposals to the City
Council for lease of the Stadium Property; 3) approves the form of the Lease from
Riverside Baseball, LLC; 4) sets a procedure for receipt and review of competing
proposals; 5) declares that the Lease satisfies the offering requirements and that the
City intends to execute the Lease if no other qualified proposal is submitted; and, 6)
directs the publication of notice of the opportunity to compete for lease of the Stadium
Property.
Mict~ael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
William Baum, Economic Development Director
CITY OF DUBUQUE, IOWA
MEMORANDUM
October 31, 2003
TO:
FROM:
SUBJECT:
Michael Van Milligen, City Manager
William Baum, Economic Development Director
Disposition by Lease of Real Property and Improvements Located in
the Port of Dubuque (Ice Harbor Urban Renewal District) to Riverside
Baseball, LLC
INTRODUCTION
This memorandum presents for City Council consideration a resolution initiating
disposition by lease of real property and improvements located in the Port of Dubuque
to Riverside Baseball, LLC. The attached resolution establishes the minimum
development requirements for lease of the real property and improvements (called the
"Stadium Property"), approves a Lease with Riverside Baseball, LLC, and solicits
competitive proposals from other developers. Unless competing proposals are
re.ceived, the City Council will act on the Lease at a public hearing on December 15,
2003.
BACKGROUND
The City has negotiated with Riverside Baseball, LLC, to bring a Class A baseball team
back to Dubuque. The City proposes to develop a baseball stadium on property owned
by the City and Dubuque Initiatives (including a small parcel owned by Alliant Energy)
and lease the property and improvements to the LLC. The final location of the stadium
has not yet been determined but will be located generally north of 5th Street, west of
Bell Street and south and east of the railroad tracks. Riverside Baseball has proposed
a lease to manage a Class A baseball team and operate the stadium facility for 20
years. The value of the improved Stadium Property, which includes land and public
infrastructure improvements, is estimated at $20,000,000. The stadium facility itself will
cost $15,000,000.
Because the Stadium Property is located in an urban renewal distdctl the City must
follow state law regarding urban renewal property disposition. In general, the law
requires that the City may sell or lease property to private persons only under
reasonably competitive bidding procedures. These include an invitation for competing
proposals and a thirty-day public notice of the City's intent to execute any land sale or
lease contract. Additionally, the City must dispose of the property at its fair market
value for uses in accordance with the urban renewal plan.
DISCUSSION
Disposition Resolution
Accompanying this memorandum is a resolution that initiates the proceedings required
to dispose of the Stadium Property in the Ice Harbor Urban Renewal District to
Riverside Baseball, LLC via lease. In bdef, the resolution: 1) agrees to lease the
Stadium Property at not less than fair market value for use by a Class A baseball team;
2) approves minimum requirements for submission of competitive proposals to the City
Council for lease of the Stadium Property; 3) approves the form of the Lease from
Riverside Baseball, LLC; 4) sets a procedure for receipt and review of competing
proposals; 5) declares that the Lease satisfies the offering requirements and that the
City intends to execute the Lease if no other qualified proposal is submitted; and, 6)
directs the publication of notice of the opportunity to compete for lease of the Stadium
Property.
Lease
The key elements of the 20-year Lease include the following:
1)
The City agrees to build a ballpark and stadium costing $15,000,000 with
a minimum of 4000 stadium-style seats and 10-14 private skyboxes.
2)
The City agrees to build a 200-car parking lot and a shell for a restaurant
on the premises if costs are within the $15 million cap.
3)
The City will be responsible for the maintenance and repair of the leased
premises.
4)
Riverside Baseball will pay annual lease payments of $177,000 with the
tenant responsible for all utilities (except water and sanitary sewer), all
security expenses, everyday maintenance and management, concessions
and equipment, and furniture, fixtures and equipment for offices and
restaurant.
5)
Riverside Baseball is obligated by the Lease to pay off the outstanding
stadium debt should they choose to leave Dubuque before the end of the
20-year lease period.
6)
The City will have a first right of refusal to purchase the baseball team
should Riverside Baseball default on its lease payments.
7)
Riverside Baseball has until December 31, 2003 to obtain all approvals
from the Midwest League, Minor League Baseball and the Office of the
Commissioner to relocate the team to Dubuque and enter into a lease
with the City. The City has until that same date to obtain voter approval to
issue bonds to finance construction of the facility.
'8) The City has until March 2, 2004 to obtain all other approvals and
obligations necessary to finance construction of the facility.
9) The Lease obligates the City to complete the facility by May 1, 2005.
Attached to this memo is a letter from Raccoon Baseball, Inc., the controlling interest
holder in Riverside Baseball, LLC, approving the attached Lease; however, the City
Council may not give final approval to the Lease at this time. Urban renewal law
requires that other qualified parties must be given an opportunity to submit competing
proposals. The above-described resolution provides for that procedural requirement,
and the City Council may not approve the Lease until after the December 15, 2003
public hearing.
RECOMMENDATION
I recommend that the City Council initiate the procedures required for the disposition of
the property being referred to as the Stadium Property to Riverside Baseball, LLC. The
lease provides for a 20-year agreement with the baseball team owner that provides an
income stream to retire a portion of the stadium debt. This action is consistent with and
flows from the Council's objective to redevelop property in the Port of Dubuque in
accordance with the recently adopted Master Plan. The proposed Class A baseball
operation will bring energy, excitement, entertainment and new investment to the Port
area.
ACTION STEP
The action step for the City Council is to adopt the attached resolution.
attachments
F:\USERS~Pm~hre\WPDOCS~baseball~dispo.mem.doc
Raccoon Baseball, Inc.
350 SW First Street
Des Moines, Iowa 50309
The Honorable Tam/Duggan, Mayor
and The City Council of Dubuque
This will confirm that R_~c__c-on Beeebell, Ino., the controlling intcr.~
holder in Riverside Baseball, LLC, ("Riverside") has approved Ifle Dubuque,
Iowa Minor League Ballpark Lease Agreement in a form substantially similar
to that presented on Ocf,~ber 31, 2003 and will take sb~l:~ for the agreement
to be approved ~ executed b~ Riverside.
R~COontl~eball, Inc.
President
RESOLUTION NO. 444-03
RESOLUTION (1) APPROVING THE MINIMUM REQUIREMENTS,
COMPETITIVE CRITERIA, AND OFFERING PROCEDURES FOR
DISPOSITION OF CERTAIN REAL PROPERTY AND IMPROVEMENTS IN
THE ICE HARBOR URBAN RENEWAL DISTRICT; (2) DETERMINING
THAT THE LEASE SUBMITTED BY RIVERSIDE BASEBALL, LLC
SATISFIES THE OFFERING REQUIREMENTS WITH RESPECT TO THE
REAL PROPERTY AND IMPROVEMENTS AND DECLARING THE INTENT
OF THE CITY COUNCIL TO APPROVE THE LEASE WITH RIVERSIDE
BASEBALL, LLC IN THE EVENT THAT NO COMPETING PROPOSALS
ARE SUBMITTED; AND (3) SOLICITING COMPETING PROPOSALS.
Whereas, the City Council of Dubuque, Iowa, did on March 4, 2002, adopt an
Amended and Restated Urban Renewal Plan for the Ice Harbor Urban Renewal District
(the "Plan") for the Urban Renewal Area described therein; and
Whereas, such Plan provides, among other things, for the disposition of properties
for private development purposes as a proposed economic development action; and
Whereas, Riverside Baseball, LLC ("Developer") has submitted to the City a
proposal for the leasing of certain real property and improvements hereinafter described for
the operation and management of a Class A baseball team at the stadium facility to be
constructed as described therein (the "Lease"), together with the request that this property
be made available for lease as rapidly as possible; and
Whereas, in order to establish reasonably competitive bidding procedures for the
disposition of the property in accordance with the statutory requirements of Chapter 403,
Code of Iowa, 2003, specifically, Section 403.8, and to assure that the City extends a full
and fair opportunity to all developers interested in submitting a proposal, a summary of
submission requirements and minimum requirements and competitive criteria for the
property offering is included herein; and
Whereas, said Developer has tendered the Lease with the City, attached hereto as
Exhibit "A"; and
Whereas, to recognize both the firm proposal for disposition of the real property and
improvements already received by the City, as described above, and to give full and fair
opportunity to other developers interested in submitting a proposal for the use of the
property, this Council should by this Resolution:
1)
Set the fair market value of the real property for uses in accordance with the
Urban Renewal Plan;
2) Approve the minimum requirements and competitive criteda included herein;
3) Approve as to form the Lease attached hereto as Exhibit "A';
4) Set a date for receipt of competing proposals and the opening thereof;
5)
Declare that the proposal submitted by Developer satisfies the minimum
requirements of the offering, and that in the event no other qualified proposal
is timely submitted that the City Council intends to approve such proposal
and authorize the City Manager to sign the Lease; and direct publication of
notice of said intent;
6)
Approve and direct publication of a notice to advise any other person of the
opportunity to compete for lease of the real property and improvements on
the terms and conditions set forth herein;
7)
Declare that in the event another qualified proposal is timely submitted and
accepted, another and future notice will be published on the intent of the City
to enter into the resulting contract, as required by law.
Whereas, the City Council believes it is in the best interest of the City and the Plan
to act as expeditiously as possible to lease the real property and improvements as set forth
herein.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the real property and improvements described in Exhibit "B'
attached hereto located in the Port of Dubuque and delineated generally by 5th Street on
the south, Bell Street on the east and the railroad tracks on the north and west (the
"Stadium Property") shall be offered for lease in accordance with the terms and conditions
contained in this Resolution.
Section 2. That it is hereby determined that in order to qualify for consideration
for selection, any person must submit a proposal which meets these minimum
requirements:
a)
Contains an agreement to lease the Stadium Property at not less than fair
market value established herein;
b)
Contains a commitment to lease the Stadium Property for use by a Class A
baseball team;
c)
Sets out or provides to the satisfaction of the City Council the proposed
developer's experience with similar baseball stadium operation and team
management;
d)
Sets out or provides to the satisfaction of the City Council the
experience of the principals and key staff who are directly engaged in
performance of contract obligations in carrying out projects of similar scale
and character; and
e)
Meets, at a minimum, the terms and conditions of the Lease submitted by
the Developer.
Section 3. That the Lease by and between the City and the Developer be and is
hereby approved as to form for the purposes hereinafter stated.
Section 4. That for the purpose of defining the offering of the Stadium Property
for lease, Said Lease shall be deemed to be illustrative of the terms acceptable to the City
with respect to:
a) Annual lease payments;
b) Construction of leasehold improvements;
c) City participation;
d) Developer obligations;
e) General terms and conditions
Section 5. That the Lease submitted by the Developer satisfies the requirements
of the offering and, in the event that no other qualified proposals are timely submitted, that
the City Council intends to accept and approve the Lease.
Section 6. That it is hereby determined that the Developer possesses the
qualifications, financial resources and legal ability necessary to lease the Stadium Property
and to manage and operate such in the manner proposed by this offering in accordance
with the Plan.
Section 7. That the annual lease payments for the Stadium Property offered by
the Developer be and are hereby found and determined to be the fair market value of the
leasehold interest being conveyed.
Section 8. That the City Clerk shall receive and retain for public examination the
attached Lease submitted by the Developer and, in the event no other qualified proposals
are timely submitted, shall resubmit the same to the City Council for final approval and
execution upon expiration of the notice hereinafter prescribed.
Section 9. That the action of the City Council be considered to be and does
hereby constitute notice to all concerned of the intention of this Council, in the event that
no other qualified proposals are timely submitted, to accept the proposal of the Developer
to lease the Stadium Property and to approve the Lease by and between City and
Developer.
Section 10. That the official notice of this offedng and of the intent of the City, in
the event no other qualified proposals are timely submitted, to approve the Lease, shall be
a true copy of this Resolution, but without the attachments referred to herein.
Section 11. That the City Clerk is authorized and directed to secure immediate
publication of said official notice in the Tele.qraph Herald, a newspaper having a general
circulation in the community, by publication of the text of this Resolution without
attachments on or before the 7th day of November, 2003.
Section 12. That written proposals for the lease of the Stadium Property will be
received by the City Clerk at or before 10:00 a.m., December 5, 2003 in the Office of the
City Clerk, located on the first floor at City Hall, Dubuque, Iowa 52001. Each propoSal will
be opened at the hour of 10:00 a.m. in City Hall, Dubuque, Iowa on December 5, 2003.
Said proposals will then be presented to the City Council at 6:30 p.m., December 15, 2003,
at a meeting to be held in the Auditorium of the Carnegie-Stout Public Library, Dubuque,
Iowa.
Section 13. That such offering shall be in substantial conformance with the
provisions of Section 403.8, Code of Iowa, requiring reasonable competitive bidding
procedures as are hereby prescribed, which method is hereby determined to be the
appropriate method for making the Stadium Property available for lease.
Section 14. That the required documents for the submission of a proposal shall be
in substantial conformity with the provisions of this Resolution.
Section 15. That the City Clerk is hereby nominated and appointed as the agent of
the City of Dubuque, Iowa to receive proposals for the lease of the Stadium Property at the
date and according to the procedure hereinabove specified for receipt of such proposals
and to proceed at such time to formally acknowledge receipt of each of such proposals by
noting the receipt of same in the Minutes of the Council; that the City Manager is hereby
authorized and directed to make preliminary analysis of each such proposal for compliance
with the minimum requirements established by this Council hereinabove. For each
proposal that satisfies these requirements, the City Council shall judge the strength of the
proposal by the competitive criteria established hereinabove. The City Council shall then
make the final evaluation and selection of the proposals.
Section 16. That in the event another qualified proposal is timely submitted and
accepted by the City, another and further notice shall be published of the intent of the City
of Dubuque, Iowa, to enter into the resulting contract, as required by law.
4
Passed, approved and adopted this 3rd day of November, 2003,
Terrance M. Duggan, Mayor
Attest:
Jeanne F. Schneider
City Clerk
F:\USERS\Pm~hre\WPDOCS\baseball~dispo.res.doc
M~OR LEAGUE BASEBALL LEASE AG~EMENT
BETWEEN
THE CITYOF DUBUQUE, IOWA
AND
RIVERSIDE BASEBALL, LLC
Table of Contents
Definitions; Leased Premises ......................................................................................................................................................... 1
Term ............................................................................................................... ~ ............................................................................... 2
Rent ........................................................................................................................ ~ ........................................................................ 2
Use of Premises ............................................................................................................................................................................... 3
Records ............................................................................................................................................................................................ 4
Construction of Stadium ................................................................................................................................................................ 4
Parking ........................................................................................................................................................... i ............................... 5
Responsibilities ...................................................................................................................................................................... ~ ......... 5
Clean-up of Stadium ......... ~ ............................................................................................................................................. .. ............. 7
Alterations, Additions, and Improvements ................................................................................................................................... 7
No Joint Venture ............................................................................................................................................................................. 8
Damage to Premises ...................................................................................................................................................................... 8
Hold Harmless ................................................................................... ~ ............................................................................................. 9
Tenant's Property ........................................................................ i .................................................................................................. 9
Insurance ........................................... ~ .......................................................................................................................................... 10
Taxes .............................................................................................................................................................................................. 11
Right to Assign .............................................................................................................................................................................. 11
Surrender of Leased Premises at Termination ........................................................................................................................... 12
Termination of Lease .................................................................................................................................................................... 12
Stadium Name ............................................................................................................................................................................. 13
Continuation of Professional Baseball ........................................................................................................................................ 13
Complaints .............................................................................................. i ..................................................................................... 16
Remedies ........................................................................................................................................................................................ 16
Notices ........................................................... , ............................................................................................................................... 17
Conditions Precedent. .................................................................................................................................................................. 18
General Provisions ........................................................................................................................................................................ 19
Savings Clause for Baseball Regulations .................................................................................................................................... 22
Dubuque, Iowa Minor League Ballpark Lease Agreement
This lease agreement is made and entered on the__th day of _, 2003, by
and between the City of Dubuque, Iowa, acting through the Dubuque City Council, ("City"),
and Riverside Baseball, LLC, an Iowa limited liability company, ("Club"):
WHEREAS, by roll call vote on November 3, 2003 the Dubuque City Council
approved a ballot measure for a voter referendum on the establishment of a capital
improvements reserve fund, the proceeds of such tax levy to be used for the purpose of
fmancing construction of a new baseball stadium for professional minor league baseball to be
built as soon as practicable at the northwest comer of FifLh Street and Bell Street, in the Port
of Dubuque district, (the "Ballpark");
WHEREAS, a vote of the citizens of the City of Dubuque is scheduled for
December 16, 2003, to consider the foregoing referendum and, subject to voter approval of
that referendum, the Dubuque City Council has determined that it is advantageous to the City
to lease the Ballpark and related facilities to the Club, and the Club wishes to lease the
facilities from City for use by its professional Minor League Baseball team;
NOW, THEREFORE, in consideration of the mutual covenants, promises and
agreements set forth below, and for other good and valuable consideration, the adequacy and
receipt of which are acknowledged by the parties, the City and the Club agree:
1. Definitions; Leased Premises.
For purposes of this Lease Agreement, "Ballpark" means the Stadium, as
defined below, and all adjoining exterior facilities and improvements of the Leased Facilities.
For purposes of this Lease Agreement, "Stadium" means fixed seating areas;
berm seating areas; concession and commissary facilities; restrooms; concourses; the playing
field, fences and dugouts; the team clubhouse building; front office facilities; ticket boxes
and admission gates; groundskeeping and maintenance facilities; skyboxes; scoreboards,
message boards and advertising locations; the year-round restaurant subject to Section 6,
lounge and gift shop areas of the Ballpark and all interior locations within the stadium
structure.
For purposes of this Lease Agreement, "Leased Premises" means the real
property described in Exhibit A, attached hereto, including without limitation the Stadium,
the Ballpark, adjoining parking areas of approximately 200 parking spaces subject to Section
6 and grounds, and all fights, privileges and improvements as described in this Lease
Agreement.
The City leases to the Club the Leased Premises, as generally described in
Exhibit A, as attached and incorporated here by this reference, and as further set forth in the
EXHIBIT A
CONCEPTUAL PI..~J',I OF BALLPARK
drawings and specifications of Exhibit B, as attached and incorporated here by this reference.
The parties agree to amend this Lease Agreement to more specifically define the Leased
Premises at such time as the final determination of the boundaries of the Leased Premises has
been made.
Pursuant to this Lease Agreement, the City grants the Club the exclusive right
during the lease term and any renewals to have and to hold such premises and all rights,
privileges, easements, parking areas, and appurtenances belonging thereto, subject only to
easements of record. The rights and privileges granted by the City to the Club shall include,
without limitation, all fights to possess, control, use, operate, maintain and modify the
Ballpark to be constructed by the City pursuant to the terms of this Lease Agreement and
further shall include such rights of way, utility easements, rights to post and display
advertising and signage within the Stadium without restriction by City ordinance or
regulation, and such other access and use rights as needed for operation of the Ballpark as a
professional sports and/or entertainment venue. The. City reserves the right of entry to the
Leased Premises, for purposes of inspection, repair and maintenance of utilities and facilities
that are the City's responsibility under this Lease Agreement and will give 48 hours advance
notice of access whenever possible. Except in emergencies, the City agrees to refrain
exercising such access rights during times the Ballpark is in use for the Club's baseball
games and Special Events and Community Events, as those terms are described below, and
to otherwise limit its exercise of access rights to prevent disruption of the contemplated uses
of the Leased Premises.
2. Term.
The term of this Lease Agreement shall be a 20-year occupancy period
commencing at 12:01 A.M., March 1, 2005, subject to the terms and conditions set forth
below. This term may be shortened or extended pursuant to Section 20, below.
3. Rent.
As rent for occupancy:
The Club shall pay to the City the fixed sum of $177,000 per year for the term
of the lease as rent for the Leased Premises. This rent obligation shall begin as of the
occupancy date of the Ballpark by the Club and rent for any partial year of occupancy shall
be pro-rated based on a 365-day year. One-half the armual rent in the amount of $88,500
shall be due and payable as a lump sum on July 1 of each year, and the balance shall be due
and payable as a lump stun on December 31.
2
4. Use of Premises.
a. Except as provided in subpart 4(b), during the term of this Lease
Agreement, the Club shall have the year-round exclusive fight to the use, possession,
operation and control of the Leased Premises, including all of the Ballpark's facilities, for
practicing and playing professional baseball games; for conducting promotions in
conjunction therewith during the regular baseball season; for any and all exhibition, pre-
season, or play-off games; for operation of restaurant, lounge and retail sales facilities;
and/or for Club-sponsored special events as further defmed below. The Club also shall have
year-ronnd exclusive use of those Ballpark areas designated as administrative and front
office facilities, clubhouse, ticket windows, restaurant, lounge, skyboxes, gift shop and
maintenance and groundskeeper facilities. The Club further shall have the right to schedule
collegiate, high school and other sporting events and concerts and other entertainment,
community, civic or similar events, each of which shall constitute a Club-sponsored Special
Event. The Club agrees to use its best efforts to schedule collegiate and high school baseball
games at the Ballpark that will allow local amateur athletes to play at the Stadium, but the
parties agree that such Club-sponsored Special Events will not be scheduled or conducted if
in the exclusive judgment of the Club they may interfere with the operation of the Ballpark
for professional baseball or if they may jeopardize the condition of the playing field. The
Club shall at all times control Ballpark advertising and signage, except for limited on-
stadium signage identifying the name of the Ballpark to the extent such name is sold
pursuant to a name mutually approved by the parties. All revenues from Club's baseball
events and Club-sponsored Special Events from all sources including, but not limited to,
ticket sales; suite rents; commissions; vending; beer, alcohol and beverage sales; parking on
the Leased Premises; advertising; sponsorships; media and programming rights; and
merchandise, novelty and retail sales shall be retained solely by the Club.
b. The City may hold up to five City-sponsored or City-approved
Community Events at the Ballpark per calendar year. Each such Community Event shall be
subject to the Club's approval, which shall not be unreasonably withheld, and further subject
to such reasonable rules and restrictions set by the Club from time to time. Such Community
Events shall not conflict with the baseball season or with any the Club-sponsored Special
Event/ Such Community Event shall not use the playing field for any athletic contest or
other event that may damage the playing surface or disrupt the Club's operations. The City
and any other sponsor ora Community Event shall not sell, post or display advertising or
signage within the Ballpark in connection with any Community Event. The City shall
provide 60 days' written advance notice to the Club of its intention to schedule a Community
Event. The Club shall have 20 business days within which to notify the City if such date
conflicts with a baseball game or a Club-sponsored Special Event. All agreed upon Ballpark
operating expenses, including but not limited to concessions, utilities, security, and clean up
costs incurred as a result of the use of the Ballpark for any Community Event shall be at the
sole cost of the City or Community Event sponsor. The City or Community Event sponsor
shall be the sole beneficiary of revenues from such events, except revenues from concessions
provided and paid for by the Club shall be retained by the Club. The City in the event of a
City-sponsored Community Event shall indemnify and hold the Club harmless from all costs,
liabilities and expenses, including reasonable attorneys' fees, arising from the City's use of
the Leased Premises or any claim arising out of, from or in connection with the City-
sponsored Community Event at the Ballpark.
c. Upon the City's request, and subject to availability, the City or its
designee shall have the use of one skybox for four baseball games annually for official
purposes to assist in recruiting business, conventions, sporting events, or personnel to the
City and for other official purposes of the City. Such requests are to be approved in advance
by the City Manager and the Club.
d. The Club's primary use of the premises shall be for the purpose of
conducting sports and other special events for the education and entertainment of the general
public. The Club, in the conducting of its programs and activities, shall not unlawfally
discriminate against any person on the basis of age, sex, race, color, national origin or
disability.
e. The provisions of this Section 4 shall not limit the Club in its use of
proper and necessary security measures for the protection of the public, its employees and
others using the Leased Premises.
f. The Club shall have no ownership interest in the Ballpark, except as
may be authorized under Sections 10 and 22(d), below.
5. Records.
The Club shall keep records relating to maintenance and repair expenditures it
makes to the Ballpark and shall submit such information as reasonably requested by the City
for: (a) reimbursement requests made to the City for Ballpark repair or capital improvement
costs advanced by the Club; and (b) capital expenditures requested by the Club for the
Ballpark maintenance, repair or improvement.
6. Construction of Stadium.
Without cost to the Club, the City shall provide the land for and build the
Ballpark at a cost to the City of $15,000,000. Such $15,000,000 cost includes the cost of
construction of the Ballpark, architectural and engineering fees and costs, construction
management fees, and all other costs of any kind to the City required to complete the
construction of the Ballpark, but not including any costs for land. The construction shall be
undertaken pursuant to and in accordance with all application Iowa laws governing the
construction of public improvements, including required public hearings. The plans and
specifications for the Ballpark are expected to be substantially in accordance with the
Dubuque Minor League Ballpark master plan and site and facilities designs prepared by
Helmuth, Obato & Kassabaum, Inc., in part as attached as Schedule 1, and shall provide for
construction of not less than a 4,000 seat stadium (with such seats to be individual chair,
stadium-style seats, not bleachers or bench seating); 10 to 14 private skyboxes with full
4
HVAC and plumbing, and indoor and outdoor seating; bermed outfield seating; gift shop and
front office facilities; and such other facilities required by and according to specifications
that meet or exceed all applicable Minor League Baseball standards.
The City shall also build the shell for a year-round full-service restaurant and
player, employee and skybox parking for approximately 200 parking spaces if such
restaurant shell and parking can be constructed by the City within the total cost to the City of
$15,000,000 as determined by the City Council in its sole discretion. If the City Council
determines in its sole discretion that either the restaurant shell or the parking or both cannot
be constructed with the total cost to the City of $15,000,000, then the City shall have no
obligation to build such restaurant shell or parking or both.
Prior to the City Council's approval of the plans and specifications and form
of contract for the construction of the Ballpark, the City shall in good faith consider the
Club's requests for design and construction features for the Ballpark. The City shall give the
Club full opportunity to participate in the design phase for the Ballpark. The City agrees to
allow the Club's designated construction manager, who until further notice shall be Sam
Bernabe, to have complete access to and copies of all construction drawings, plans and
designs for the Ballpark upon request of the Club's designated construction manager.
Additionally, the City shall make a reasonable effort to include the Club's designated
construction manager in all design, planning, construction, inspection and approval and
acceptance meetings and conferences.
The City agrees to construct the Ballpark in accordance with the plans and
specifications approved by the City Council. The City will construct the Leased Premises in
accordance with the approved plans in advance of completion dates as mutually agreed upon
by the City and the Club and that provide for occupancy of the Ballpark and use of the
Leased Premises for its intended purposes on or before May 1, 2005.
7. Parking.
Except during Community Events as provided in Section 4, the Club shall
have the exclusive right and privilege of conducting the parking of vehicles on all parking
areas within the Leased Premises or otherwise assigned or licensed for use by the Club, in
accordance with reasonable rules and regulations now or hereinafter established by the City.
Charges for such parking shall be set at the sole discretion of the Club and all revenues from
parking in areas assigned to the Ballpark shall be retained solely by the Club. The City shall
have no responsibility to provide personnel or security for parking of the Club's patrons and
visitors on the Ballpark premises.
8. Responsibilities.
a. During the term oft his Lease Agreement, the City shall furnish and/or
bear the costs of furnishing or satisfying the following:
(1) Structural maintenance and repairs to the Leased Premises;
(2) Replacement and/or capital repairs of the Ballpark's mechanical
equipment, roofing, security light'mg, security systems, plumbing, electrical systems, heating,
air conditioning, playing field surfaces, playing field lights, stadium seats, fencing and
parking surfaces, to the extent such replacement and capital repairs are not necessitated by
improper or inadequate maintenance performed by the Club;
(3) Such capital repairs, improvements or enhancements as
requested by the Club that the City deems are reasonable and necessary;
(4) Water, for drinking, irrigation and all other Ballpark uses, and
all sanitary sewer services.
To assist in providing sufficient reserves for the financing for capital
expenditures for and/or capital maintenance, repairs or improvements to the Ballpark, the
City shall create an account into which it deposits one-half of the excess in taxes levied and
collected in connection with the capital improvements reserve fund approved by voters in
December 2003 to fund construction of the Ballpark, over the amount of such taxes actually
needed and used to pay the interest and retire principal for those bonds issued by the City in
2004 in connection with initial construction of the Ballpark.
b. During the term of this Lease Agreement, the Club shall furnish and/or
bear the cost of those operating expenses required to operate its professional baseball team
and provide:
(1) Maintenance and cleanup of the Leased Premises, including the
preparation of the playing field for each baseball game, as well as ma'mtenance and cleanup
of the stadium grounds and parking areas within the Leased Premises after all professional
baseball games and Club-sponsored Special Events. Maintenance shall include, but not be
limited to, leveling and grooming of the playing field, minor fence repairs, plumbing,
electrical systems, restrooms and supplies, and providing infield tarpaulins;
(2) All utilities used for Ballpark operations by the Club shall be
billed in the name of the Club, except for water and sewer, and payments for those utilities
not included in the rent under Section 3 shall be the responsibility of the Club;
(3) All parking attendants, ushers, and security during the actual use
of the Leased Premises by the Club for its baseball games and for Club sponsored-Special
Events, but not for any City-sponsored or authorized Community Event;
(4) All concessions and concession equipment;
(5) Routine maintenance and custodial work of the clubhouse
building, administration building, and all concession areas in the stadium, as well as repairs
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to mechanical equipment, including rout'me light bulb and filter changes. It is understood
and agreed that the Club shall have the use of furnishings and equipment included in the
initial construction of the Leased Premises, and that ordinary maintenance and repair of said
furnishings and/or equipment to keep them in good and presentable condition shall be the
responsibility of the Club;
(6) All furniture, fixtures and equipment for its offices; and
(7) The complete build-out and all furniture, fixtures and equipment for
theremaurant.
9. Clean-up of Stadium.
Except for special City-sponsored events or authorized Community Events as
provided in Section 4, the Club shall, at its expense, clean the Ballpark and keep it in an
orderly condition including:
a. Providing personnel and supplies for clean-up of field, seating stands,
concession areas, restrooms, and grounds;
b. Cleaning and routine maintenance of stadium seats;
c. Removing refuse from the field; and
d. Collection, removal and disposal of rubbish, trash, and garbage within
the stadium, stadium grounds, playing field and the park'mg areas of the Leased Premises and
from the Leased Premises after each baseball game.
10. Alterations, Additions, and Improvements.
a. After completion of stadium construction, the Club, at its own risk and
expense, may make alterations, additions and improvements to the Ballpark, provided that
the same shall not lessen the value of the Ballpark as of the time of commencement of such
work, or change the purposes for.which the Ballpark may be used. The plans and
specifications for any such modifications shall first be submitted to and approved in writing
by the City Manager. The Club shall not be required to submit plans and specifications for
modifications that cost less than $5000.
b. Any permanent additions, improvements, or fLxtures made, installed, or
affixed to the Ballpark by the Club in such manner as not to be removable without material,
physical damage to the Leased Premises shall become the property of the City.
c. Any additions, improvements or fixtures made, installed or affixed to
the stadium by the Club in such manner as to be removable without material physical
damage to the Leased Premises, and all trade fixtures, machinery, scoreboards, videoboards,
7
video and sound systems and other personal property or equipment installed by the Club,
shall be and remain the property of the Club and may be removed or replaced by the Club at
any time during the term of the Lease Agreement and at Club's option may be removed at its
termination. Any damage to the Leased Premises in the course of such removal shall be
repaired by the Club at its own cost and expense. Any personal property or equipment or
Tenant's Property as defined in Section 14 below not so removed upon termination of this
Lease Agreement shall become the property of the City.
d. It is expressly understood that any electronic scoreboard or videoboard
that is not included in the initial construction of the Ballpark by the City will be paid for and
owned by the Club or a third party supplier and shall for purposes of this Lease Agreement
be considered as removable trade fixtures in which the City has no ownership interest. The
City is not responsible for the care and maintenance of any such removable trade fixtures.
e. To avoid damage to the playing field and to accommodate Special
Events and other special uses, the Club may at its expense and after approval by City,
construct or rent a movable stage, and/or temporary eating and entertainment buildings,
and/or such other temporary improvements for those purposes as the Club shall deem
appropriate. If such temporary improvements are necessary for the conducting of any
Community Event, the costs for such improvements shall be paid by the City and/or the
Community Event sponsor.
f. Upon the expiration of the term of this Lease Agreement, or upon any
early termination of this Lease Agreement under Section 20, below, except as otherwise
provided in this Lease Agreement, all permanent or freed asset repairs, alterations, additions
or improvements made by the Club to any structure on the Leased Premises shall become the
property of the City without further action or payment on its part.
11. No Joint Venture.
This Lease Agreement does not create the relationship of principal and agent
or of partnership or of joint venture. The sole relationship between the City and the Club
shall be that of landlord and tenant.
12. Damage to Premises.
If the Ballpark, or any portion thereof or improvements thereto, are damaged
by fire, flood or other casualty that can be repaired or rebuilt within ninety (90) days fi.om the
happening of said damage, the Club shall not have the right to terminate this Lease
Agreement, but shall as soon as reasonably possible after such damage has been repaired
continue its operation of the Ballpark subject to the provisions of this Lease Agreement. If
the Ballpark or any portion thereof are damaged or destroyed by fire, flood or other casualty
so that the Club cannot conduct its regular baseball game day business in the Ballpark, and if
the premises cannot be repaired or rebuilt within ninety (90) days fi.om the happening of said
damage or destruction, the Club may elect to terminate this Lease Agreement. Upon such
8
termination by the Club, it shall immediately surrender said premises, paying such mounts
as may be due to the time of the damage or destruction and thereafter have no fights or
obligations under this Lease Agreement. During any period when the Club is not able to use
the Leased Premises due to damage or destruction, it shall have the right to abate its rent as
to that proportionate part of the Leased Premises the Club is not able to use as otherwise due
under Section 3, above.
13. Hold Harmless.
Each party shall indemnify, defend, and hold the other, its officers, agenfs, and
employees harmless from and against any and all liabilities, obligations, damages, penalties,
claims, costs, charges, losses, and expenses (including without limitation, reasonable fees
and expenses of attorneys, expert witnesses and other consultants, including the reasonable
value of services rendered by corporate counsel ("Liabilities") resulting from the negligent or
tortious act, error or omission of the indemnifying party, its officers, agents, employees,
contractors, subcontractors or other representatives, excepting only such Liabilities as shall
have been occasioned by the negligence of the party seeking indemnification.
The inderunification granted by each party in this Section 13 shall be subject
to the waivers contained in Section 15(t) below. These indemnification obligations shall
survive the termination or expiration of this Lease Agreement.
14. Tenant's Property.
a. The following property (collectively, "Tenant's Property"), whether or
not located in or on the Leased Premises, does not constitute a portion of the Leased
Premises and, notwithstanding any other provision of this Lease Agreement shall at all times
during and after the lease term be the property of the Club unless after termination it is left in
place by the Club pursuant to Section 10(c), above:
(1) All items of personal property, equipment and fixtures about the
Leased Premises that are added to the Leased Premises or brought upon it by the Club
followSng completion of construction by the City, and whether or however attached to the
Leased Premises, at any time that are necessary, incidental or convenient to the business
fi:om time to time conducted at the Leased Premises, including, without limitation, exercise
equipment, kitchen equipment and furnishings, work stations, portable or movable partitions,
receptionist desks, millwork, credenzas, computer installations (including computers,
computer hardware, raised flooring, freestanding supplemental air conditioning or cooling
systems therefor), communications systems and equipment, financial services equipment
(such as ATM's), safes, safe doors, bulletin boards, book shelves and file cabinets, but
excluding central HVAC and other building systems (other than telecommunications
equipment, which shall be deemed the personal property of the Club), walls (other than
demountabte wails or partitions), doors, trim, floor and wall coverings, ceiling lights and tile,
window shades and the like;
9
(2) All furniture, inventory, machinery, racking, shelving, and other
personal property;
(3) Any personal property, equipment or fixtures which is either not
owned by the Club or the City or is on consignment to the Club, including any personal
property owned by the Club's, subtenant's, employees or invitees;
(4) All signs and other forms of business identification; and
(5) Any other items of personal property whatsoever.
b. The Club shall have the right in its sole and absolute discretion from
time to time to install, alter, remove and/or replace such Tenant's Property as it shall deem to
be useful or desirable in connection with its business in the Leased Premises. The Club
further shall have the ri~t to enter into such agreements and assignments with respect to the
Tenant's Property as the Club in its sole discretion shall deem advisable, including financing
and similar arrangements.
c. The City shall execute such landlord consents and other agreements as
shall be reasonably requested by the Club in connection with any such agreements and
arrangements. The City hereby waives each and every right which the City now has or may
hereafter have under applicable law or by the terms of any agreement now in effect or
hereafter exemised by the City or by any lender to levy or distrain upon any of the Tenant's
Property for rent or to claim or assert title to any of the Tenant's Property.
15. Insurance.
a. The Club shall provide insurance as set forth in the City's standard
Insurance Schedule for Lessees of City Property; as such uniform, standardized schedule
may from time to time be amended. The current Insurance Schedule is attached to this Lease
Agreement as Insurance Schedule A.
b. The City shall purchase and maintain all-risk property insurance on the
building and structures of the Leased Premises, which shall include all perils, including
flood. For purposes of this subparagraph, additions, improvements, fixtures, trade fuctures,
machinery and equipment affixed to the Leased Premises and installed by the Club shall be
covered by the all-risk property insurance policy maintained by the City, even though such
items may be removed by the Club at the termination of this Lease Agreement. The Club
shall be responsible for the purchase and maintenance of any property insurance covering the
contents of the building structures. For purposes of this subparagraph, contents shall be
furnishings, equipment and personal property owned or used by the Club that are not affixed
to the Leased Premises. The City shall furnish certificates of insurance to the Club for the
coverages required in this Section, naming the Club as an additional insured. All policies of
insurance shall be endorsed to provide a thirty (30) day advance notice of cancellation to the
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Club if cancellation is prior to the expiration date. Those endorsements shall supersede the
standard cancellation statement on the certificate(s) of insurance.
c. Notwithstanding any other provision in this Lease Agreement to the
contrary, the City and the Club each hereby releases the other party from any and all liability
or responsibility to such party or anyone claiming through or under them by way of
subrogation or otherwise for any loss or damage to the Leased Premises, the Club's property
on the Leased Premises, to the Ballpark, or to property located thereon, resulting from any
occurrence coverable by property damage insurance policies commercially available or
required to be maintained hereunder by such party, even if such occurrence shall have been
caused by the fault or tortious act or omission of the other party or anyone for whom the
other party may be responsible. Each of the City and the Club agrees that its policies will
include such a clause or endorsement permitting such waiver, but the failure to obtain such a
clause or endorsement shall not negate the waiver provided in this Section.
16. Taxes.
During the lease term, the Club shall be responsible for payment of all
property taxes on its personal property located on the Leased Premises, and the City shall be
responsible for payment of all real estate and/or real property taxes and special assessments
assessed against the Leased Premises. City and the Club agree there is no intent to establish
a tax liability on either party. If a tax liability not presently foreseeable, other than the
personal property taxes, real property taxes, income taxes and special assessments as
allocated elsewhere in this Lease Agreement, accrues to either party by virtue of this Lease
Agreement, the parties agree to negotiate in good faith to adjust the rents payable under this
Lease Agreement to accommodate the economic effect of such unforeseen and unallocated
tax.
17. Right to Assign.
Except for skybox rental agreements and contracts with vendors engaged by
the Club to provide restaurant, lounge, concession, food, beverage and/or merchandising for
goods and services, neither party may assign this Lease Agreement or sublease the Leased
Premises to any other party without first obtaining the approval of the other party. In the
event the Club assigns this Lease Agreement or subleases all or any part of the Leased
Premises as permitted herein, the Club shall promptly notify the City in writing, and, in such
event, the Club shall remain liable to City under all of the terms of this Lease Agreement.
Any attempted sublease or assignment not specifically permitted herein without the consent
of the non-assigning party shall be null and void, shall confer no rights on any third party,
and shall be cause for termination of this Lease Agreement by the non-assigning party upon
ninety (90) days prior written notice to the other party, with the party seeking assignment
having the right to rescind the assignment attempt in those 90 days. These provisions against
assignment and sublease shall be deemed to be a continuing covenant and shall apply to any
and all sub-lessees or assignees of this Lease Agreement and to anyone who may, in any
manner, acquire any interest therein. Each and every covenant and agreement contained in
11
this Lease Agreement shall extend to and be binding upon respective successors, heirs,
administrators, and assigns of the parties.
Notwithstanding anything to the contrary in this Lease Agreement and
provided there is no uncured default hereunder, the Club may, without obtaining the City's
consent or giving prior notice to the City, transfer, sublet or assign all or a part of the Club's
interest in this Lease Agreement to any affiliate, subsidiary or parent entity that has a
controlling interest in the Club, is controlled by the Club or is under common control by the
Club's shareholders, or to the surviving limited liability company, corporation or parmership
in a statutory merger or reorganization of the Club, or to any limited liability company,
corporation or partnership which purchases substantially all of the equity, stock or assets of
the Club, or to any limited liability company, corporation or parmership, the majority voting
equity, stock or interest of which shall be owned by equity owners of the Club holding a
controlling percentage or more of the voting interests of the Club.
18. Surrender of Leased Premises at Termination.
The Club agrees that upon the termination of this Lease Agreement, it will
surrender, yield up and deliver the Leased Premises including the Club improvements left in
place, if any, in clean condition and flee of debris.
19. [No paragraph 19]
20. Termination of Lease.
a. This Lease Agreement expires on its own terms as of February 28,
2025 unless it is terminated earlier pursuant to the terms of this Lease Agreement or
applicable law.
b. In addition to any other rights of termination it may have under
applicable law or elsewhere in this Lease Agreement, the Club may terminate this Lease
Agreement at any time after the occurrence of any one or more of the following events, upon
written notice of termination given by the Club to the City at least sixty (60) days in advance
of the proposed effective date of termination:
(1) Upon any material breach by the City of this Lease Agreement;
however, before any such termination shall become effective, the Club's written notice of
termination to the City shall specify the material breach and the City shall have that 60-day
period prior to the effective date of the termination to cure its material breach.
(2) The City's sale or attempted sale of the Ballpark or the City's
assignment or attempted assignment of this Lease Agreement to a third-party, including
without limitation, another governmental body, private, public or quasi-public agency,
corporation or person; it being the intent of the parties that the Club's relationship to the City
as the landlord is an essential term of this Lease Agreement.
12
(3) The City's failure to deposit and/or reserve any of the capital
expenditure amounts as required by Section 8(a) and/or the City's failure to use such
collected and reserved funds for the fmancing of capital improvements to and maintenance of
the Ballpark as required by this Lease Agreement.
(4) The early retirement of the bonds, notes and other obligations
issued by the City to fund initial construction of the Ballpark and of all other debt incurred
by the City for the specific purpose of funding the costs and expenses of constructing the
Ballpark.
(5) The occurrence of any event set forth in Section 22(c) below.
21. Stadium Name.
If the City enters a naming rights agreement for the Stadium prior to the time
of occupancy of the Ballpark by the Club, the City agrees that all such funds received under
that agreement will be used for financing construction of the Ballpark. Any name shall be
reasonably acceptable to the City and the Club. During the term of this Lease Agreement,
the City may name or rename the stadium with the prior written approval of the Club. In the
event compensation is received by the City as consideration for naming or renaming the
Ballpark after occupancy, all such compensation shall be applied to retire the City debt
incurred for construction of the Ballpark or deposited in the City's Ballpark capital
improvements account required by Section 8(a) above.
22. Continuation of Professional Baseball.
a. The Club acknowledges that the City's motive in entering this Lease
Agreement is to ensure the attraction and continuation of professional baseball in Dubuque,
Iowa. To provide adequate assurances to the City that the Club will maintain a professional
baseball team in Dubuque, Iowa operating from the Ballpark, the Club agrees that during the
term of this Lease Agreement:
(I) It will maintain and operate a professional baseball team in
Dubuque, Iowa and to use the Leased Premises for this pm'pose. In the event that the Club
does not use the Leased Premises for the operation of professional baseball on a regular
seasonal basis during any calendar year and such failure is not otherwise excused by
applicable law or the terms of this Lease Agreement, then the Club shall be deemed to have
breached this Lease A~eement. The Club shall not be deemed to have breached this Lease
Agreement if its failure to operate a professional baseball team during a season is caused by a
labor dispute, walk-out, disruption or strike, acts of God, war, terrorism, or civil
disobedience, the imposition of a rule, regulation or policy by Major League Baseball or
Minor League Baseball that would preclude or restrict the Club from operating a professional
baseball team in Dubuq~e, Iowa, and subject to par. 22(3).
13
(2) It will use its best efforts to maintain its membership in the
Midwest League of Professional Baseball Clubs, Inc. (Midwest League) or irs successor, if
any, and its status as a Class A affiliated ball club. In the event of the dissolution of the
Midwest League, or in the event of the Club's loss of membership in the Midwest League
through no fault of the Club, the Club agrees to use its best efforts to obtain membership in
another such association and to attain the status of or equivalent to a Class A ball club, if
commercially possible. In the event the Club fails to use its best efforts to maintain its
membership in the Midwest League, or to maintain its status as a Class A bail club, or in the
event the Club fails to use its best efforts to obtain membership in another association and to
obtain status therein equivalent to a Class A ball club, then in any such event the Club shall
be deemed to have breached this Lease Agreement.
(3) Neither it, nor any person, parmership, corporation or other
legal entity which controls the Club [hereinafter singularly and collectively referred to as
"prospective seller"] shall, during the term of this Lease Agreement, sell, transfer or convey
the existing professional baseball franchise, the majority interest in its voting common stock
or the majority control in the shares of the prospective seller without giving the City an
opportunity to purchase the franchise or the stock or the majority control hi the shares of the
prospective seller for the same price and on the same terms as set forth in a bona fide written
offer made by a third party to the prospective seller, unless the third party agrees in a binding
w~citten instrument to continue to maintain and operate a professional baseball team in
Dubuque, Iowa, for the term of this Lease Agreement and as otherwise provided ha this
Lease Agreement, to use the Leased Premises for this purpose. Additionally, the third party
purchaser shall agree to assume the obligations of the Club under this Lease Agreement for
the duration of the lease term [collectively referred to as a ~'third party commitment"]. If the
prospective seller receives a bona fide written offer from a third party which does not include
a complete "third party conmfitment," then the prospective seller shall provide the City with
a complete copy of the written offer, and the City shall have ninety (90) days from the receipt
thereof to notify the prospective seller of the City's intent to exercise its option to purchase
on the exact terms and conditions set forth hi the written offer. If the City rejects the offer,
or fails to act within ninety (90) days of receipt thereof, then the prospective seller may
proceed with the sale, transfer or conveyance, but only on terms which are in strict
compliance with those set forth in the written offer, and in such event, the pm'chase
agreement shall provide that the seller is liable for and shall pay to the City at the time of the
sale the amount required to be paid by par. 22(4). In the event that prospective seller does
not consummate the transaction with the third party, then any subsequent offer received by
the prospective seller shall be subject to the terms of this paragraph. Upon receipt of
notification fi'om the prospective seller ora bona fide written offer giving rise to the City's
first refnsal right, the City may assign its option with regard to that offer to any other person,
parmership or corporation or other legal entity which demonstrates to the City's satisfaction
that it will retain the frmachise and professional baseball in Dubuque, Iowa, and who
otherwise can meet the terms and conditions of the offer.
(4) If(i) the Club seeks to assign this Lease Agreement
without City approval, except where such approval is not required as provided in
14
Section 17, or to terminate or terminates this Lease Agreement without gromads for
early termination as provided elsewhere in this Lease Agreement or (ii) the Club is in
material breach of the other provisions of this Section 22(a) and fails to cure of such
breach within ninety (90) days of receipt of written notice from the City specifying
the breach, then the Club shall pay the City an amount equal to the unamortized cost
of the Ballpark, based on a $15 million expenditure, calculated on a straight-line basis
using the 240-month term of this Lease Agreement.
Such paymem shall be made within sixty (60) days of demand by the City.
The unamortized cost shall be calculated by multiplying $62,500
($15,000,000/240 month expected lease term) by the number of months remaining in the
Lease Agreement as of the effective date of the termination.
For purposes of illustration, if the Club terminated this Lease Agreement
effective as of February 28, 2010 and the City elected to proceed under this Section 22(a)(4),
there would be 180 months then remaining on the Lease Agreement. Under this example,
the early termination amount due from the Club to the City for the unamortized cost would
be $11,250,000 ($62,500 nmltiplied by 180).
In the event that the Club fails to malce payment to the City as required in this
Parl 22(a)(4), the City shall have the right to the equitable remedy of specific performance of
the ten~ns and conditions of this Lease Agreement.
Nothing in this Par. 22(a)(4) shall, however, supersede the City's fight of f~rst
refusal as provided in Par. 22(a)(3).
b. The Club shall have the right of first refusal to purchase the Ballpark
and/or Leased Premises on the same terms and conditions as any bona fide offer made to the
City for its acquisition, which fight shall be exercisable may time within ninety (90) days of
the written notice to the Club by the City specifying the terms of sale it is ready to accept and
including a copy of the written offer and acceptance or purchase agreement that the City is
ready to enter with a third-party.
c. The obligations of the Club under Sections 22(a)(i)-(4) above shall
terminate if and at the time the City enters any lease agreement, financial support
arrangement or other relationship under which it builds, constructs or maintains facilities for
use by another professional baseball team or directly or indirectly provides financial support,
dedicated facilities or specialized services to such a professional baseball team. In addition,
the occurrence of any such event shall provide grounds for the Club to terminate this Lease
Agreement under Section 20(b)(5), above.
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23. Complaints.
All complaints by City with regard to the operation of the Leased Premises
shall be by written notice to the Club from the City Manager. Any complaints by the Club
directed to City shall be by written notice to the City Manager ~om an authorized officer of
the Club.
24. Remedies.
a. In the event the Club (i) shall have failed to pay any rent within five (5)
business days of any date that such rent is due hereunder or (ii) shall have failed to
substantially comply with may term, covenant or condition of this Lease Agreement, except
those relating to the payment of rent, and other than mxder Section 22(a)(3-4), and the Club
shall have failed to cure the same within sixty (60) days after written notice from the City
specifying the nature of the default, the City may at its election terminate this Lease
Agreement and pursue any other remedy now or hereafter allowed by law or elsewhere
provided in this Lease Agreement, including but without limitation, claims for any and all
actual dmnages resulting from such default. In the event the City elects to terminate this
Lease Agreement, the City thereafter shall have the right to enter and take possession of the
Leased Premises without process of law and cause the property of the Club to be removed
therefrom. In such event, however, the Club shall not be entitled to remove permanent capital
improvements made to the Leased Premises, including but not limited to additions,
improvements, fixtures, trade fixtures, machinery and equipment affixed to the Leased
Premises and installed by the Club. Capital improvements for this purpose shall not include
concession equipment controlled or used by the Club or any Tenant's Property.
b. Accordingly, the parties agree that damages for any material breach on the
part of the Club other than under Section 22(a)(3-4) that is not cured may be inadequate and,
in addition to the various rights, powers, options, elections and remedies either party may
have under applicable law and/or this Lease Agreement, the City shall have the right to the
equitable remedy of specific performance. The granting of the remedy of specific
performance, however, shall in no way affect or impair the fight of either party to pursue any
other equitable or legal remedy to which either patty may be entitled, as long as any material
breach remains in any way unremedied, unsatisfied or undischarged.
c. Upon a material breach of this Lease Agreement by the Club, other than for
a breach of the Club's covenants and obligations reader Section 22(a)(3-4), in addition to any
rights it may have at law or in equity, the City may declare that the 'Club shall not be entitled
to the benefit of any provision of this Lease Agreement and shall not be entitled to remove
permanent capital improvements made in the Leased Premises, including, but not limited to,
additions, improvements, fixtures, trade fixtures, machinery and equipment affixed to the
Leased Premises and installed by the Club. Capital improvements for this purpose shall not
include concession equipment controlled or used by the Club or any Tenant's Property.
16
25. Notices.
All notices required to be given heremader by the Club to the City shall be in
writing, sent by United States Mail, fn:st class postage prepaid, or by a commercially
recogmized overnight cra'tier such as UPS or Federal Express, and addressed to the City as
follows:
The City of Dubuque
Attn: Michael C. Van Milligen, City Manager
City Hall
50 West 13th Street
Dubuque, Iowa 52001-4864
With a copy to:
The City of Dubuque
Attn: Barry Lindahl, City Attorney
City Hall
50 West 13th Street
Dubuque, Iowa 52001-4864
All notices required to be given by the City to the Club shall be in writing, sent
by U.S. Mall, first class postage prepaid, or by a commercially recognized overnight carrier
such as UPS or Federal Express, and addressed to the Club as follows:
Riverside Baseball, LLC
Attention: Michael G. Garmer, President
Sec Taylor Stadium
Second Street and Riverside Drive
Des Moines, Iowa 50309
With a copy to:
Michael A. Giudicessi, attorney
Faegn'e & Benson LLP
801 Grand Avenue
Suite 3100
Des Moines, Iowa 50309-8002
A party may change its address and/or desi~ees for notices and copies by giving
written notice to the other pm'ty specifying the change and its effective date.
17
26. Conditions Precedent.
A party's obligations under this Lease Agreement shall be subject to the
satisfaction of each separate condition precedent specified in this Section 26. A party may
waive the satisfaction of a condition precedent to its obligations orfly by giving written notice
to the other party specifying the condition(s) that it waives.
a. Conditions Precedent for Both Parties:
The City or the Club shall not be obligated to perform this Lease Agreement:
(1) If on or before December 31, 2003, the City has not obtained
necessary voter approval to issue bonds to finance construction of the Ballpark;
(2) If on or before March 2, 2004, the City has not obtained City
Council approvals to issue bonds, notes and all other obligations necessary to finance
construction of the Ballpark, and the City agrees to use its best efforts to issue such bonds,
notes and other obligations necessary to finance construction of the Ballpark prior to March
2, 2004;
(3) If any court action challenging the execution and performance
of this Lease Agreement is instituted prior to March 15, 2004.
(4) If for any reason the Club's relocation application for moving its
Midwest League franchise and operations to Dubuque, Iowa commencing with the 2005
baseball season and this Lease Agreement are not approved by the Midwest League, Minor
League Baseball and the Office of the Commissioner on or before December 31, 2003.
b. Conditions Precedent to City's Oblieations:
The City shall not be obligated to perform this Lease Agreement:
(1) If the execution of this Lease Agreement by the City is not
approved by the City Council on or before December 15, 2003.
c. Conditions Precedent to the Club's Obligations:
The Club shall not be obligated to perform this Lease Agreement:
(1) If the execution of this Lease Agreement by the Club is not
approved by its Management Committee on or before November 3, 2003, and by its lenders
and fi-om ali third parties with rights of approval or consent (other than Minor League
Baseball and other baseball officials) on or before December 15, 2003;
18
(2) If construction of the Ballpark is not substantially completed per
plans, specifications and the terms of this Lease Agreement such as to allow the Club to
conduct its regular baseball game day business on or before May 1, 2005.
27. General Provisions.
Marginal Headings. The marginal headings and titles to the sections of
this Lease Agreement are not a part of this Lease Agreement and have no effect upon the
construction or interpretation of any part of it.
b. Time. Time is of the essence in this Lease Agreement.
c. Recordation. Neither the City nor the Club will record this Lease
Agreement withom the prior written consent of the other party; provided however, upon the
request of either the City or the Club, the pm'ties will mutually execute and deliver a short form
or memorandum of this Lease Agreement for recording purposes. The City shall maintain a
copy of this Lease Agreement for inspection and copying by the public under Iowa Code
Chapter 22.
d. Quiet Possession. So long as the Club pays rent under Section 3 and
observes and performs ali of the covenants, conditions and provisions On the Club's part to be
observed mhd performed hereunder, the City will deliver, secure and maintain quiet possession
of the Leased Premises for the Club for the entire term of this Lease Agreement, including
renewals, if any.
e. Under~ound Storaze Trunks. The City represents and warrants that no
underground storage tanks are located on or in the Leased Premises and that remediation
necessitated by the presence o£underground storage tanks or other contaminant, if any, has
been completed by the City or its predecessors in interest to the full extent required by law.
The Club shall at no time install Or opm'ate any un~derground storage tank on the Leased
Premises.
f. Prior A~eements. This Lease Agreement contains all of the agreements
of the pm~ties with respect to any matter covered or mentioned in this Lease Agreement and no
prior agreements or understanding pertaining to any such matters shall be effective for any
purpose. No provision of this Lease Agreement may be amended or added to except by an
agreement in writing signed by the pm'ties or their respective successors in interest. This Lease
Agreement is not effective or binding on any party until fully executed by both parties.
g. Inability to Perform. Except for the condition precedent set forth in
Section 26(c)(2), this Lease Agreement and the obligations of the parties hereunder will not be
affected or impaired because a party is unable to fulfill any of its obligations or furnish smwices
and utilities hereunder or is delayed in doing so, if such inability or delay is caused by reason
of acts of God, strikes, lockouts, labor troubles, inability to procure materials, extreme weather,
flood, governmental laws or regulations or goverrunental requests for the general public
19
welfare, or other causes beyond the reasonable control of such party. During the time of such
inabilky to perfonn, the delayed party shall not be deemed to be in material breach of its
obligations under this Lease Agreement; however, the delayed party shall give reasonably
prompt notice to the other party of the occurrence causing such delay.
h. Choice of Law/Personal Jurisdiction. This Lease Agreement shall be
governed by the laws of the State of Iowa. Each party consents to the personal jurisdiction of
the state mad federal courLs in Iowa.
i. SeverabiliW. Any provisions of this Lease Agreement deemed to be
invalid or unenforceable will in no way affect, impair or invalidate any other provision hereof
and all other provisions will remain in full force and effect. However, Section 26(c)(2) of this
Lease Agreement represents an essential term, the invalidity or unenforceability of which will
render this Lease Agreement of no further force and effect.
j. Estoppel Certificate. Each party will at any time, and from time to time,
upon not less than ten (10) business days prior written notice from the other party execute,
acknowledge and deliver to the other party a statement in writing, certifying as to the
following: (1) whether this Lease Agreement is umnodified and in full force and effect (or, if
modifie~l, stating the nature of such modification and certifying that this Lease Agreement as
modified, is in full force and effect), and the date to which the rent and other charges are paid
in advance, (2) aclmowledging whether there are, to the best of the certifying party's
knowledge, any uncured defaults on the part of the other party hereunder or specifying such
defaults if any are claimed and (3) such other matters requested by the other party. Any such
statement may be relied upon by a prospective purchaser or encumbrances of all or any portion
of the land of which the Leased Premises are a part.
k. Attorneys' Fees. In any action or proceeding arising out of this Lease
Agreement and/or the relationship between the City as landlord and the Club as tenant, the
prevailing party shall be e~titled to recover its expenses, attorneys' fees and costs from the
non-prevailing party.
1. Counterparts. This Lease Agreement may be executed in any number
of counterparts, each of which shall be deemed an original.
m. No Dedication or Other Rights. There are no intended third party
beneficiaries to this Lease Agreement. The rights of occupancy and use described in this
Lease Agreement are private rights granted to the Club. The parties expressly disclaim any
intention to dedicate to public use the Ballpm'k, the Leased Premises or any portion thereof or
any extension thereto. This Lease Agreement shall not permit and shall not be deemed to
permit the public or any persons to acquire may prescriptive easement or other right in or
interest with respect to the Ballpark, the Leased Premises or any segment thereof or any
extension thereto.
20
n. Non-disturbance A~reement. The Club agrees that, upon the request of
the City made in a written notice to the Club, it wilt subordinate this Lease Agreement to
each ground or land lease now or hereafter covering all or any part of the land of the Leased
Premises and to each mortgage or deed of trust Yvhich may' now or hereafter encumber the
Ballpark and land of the Leased Premises, as well as to all renewals, modifications,
consolidations, replacements and extensions thereof(any of the foregoing being referred to
as a "Superior Encumbrance"); provided, however, that the holder of each Superior
Encumbrance shall enter into an agreement (a "Non-disturbance Agreement") with the Club
providing that the Club shall not be disturbed in its possession of the Leased Premises or its
rights hereunder terminated by such holder, each and every subsequent holder of such
Superior Encumbrance and any purchaser in the event of a foreclosure thereof, as long as the
Club is not in default m~der this Lease Agreement, and that in the event of foreclosure, the
foreclosure shall be made subject to this Lease Agreement to the end that any purchaser at
the foreclosure shall be bound by the terms of this Lease Agreement. The City shall, not
later than fifteen (15) days after the date hereof, obtain a Non-disturbance Agreement fi.om
the holder of any existing Superior Encumbrance.
o. The City's Representations as Landlord. Notwithstanding anything in
this Lease Agreement apparently to the contrm-y, the City warrants, represents and covenants
that:
(1) The Ballpark and Leased Premises will be as of the date
of the Club's occupancy in compliance with any and all zoning laws, regulations, ordinances
and codes ("Legal Requirements") affecting the land, buildings or any other portion of the
Leased Premises;
(2) The land, building and all other portions of the Leased
Premises do not presently and hereafter shall not contain any pollutant, toxic or hazardous
waste or any other material the release or disposal of which is regulated by any law,
regulation, ordinance or code, nor may asbestos, urea-formaldehyde foam insulation, PCBs,
radon or pelroleum~based fuel tanks ("Hazardous Substances"), except that the City shall not
be responsible for any Hazardous Substances released or disposed of by the Club. Such
warranties, representations and covenants of the City shall survive and be enforceable by the
Club after expiration or termination of this Lease Agreement; and
(3) As of the date of this Lease Agreement and as of the date
of occupancy of the Leased Premises by the Club, there are not and shall not be any
restrictions, covenants or exclusive rights which would prohibit tho Club fi.om using the
Leased Premises for a sports stadium and venue l'or baseball games, sporting events, concerts
and other Special Events and Commmfity Events and for general office, restaurant and retail
uses related thereto and in accordance with this Lease Agreement, and the City covenants not
to enter into any such restrictions, covenants or a~'eements during the term of this Lease
Agreement.
21
28. Savings Clause for Baseball R%oxtlations
This Lease Agreement shall be subject to amendment and modification only
by written agreement of the parties and for such matters as the parties deem appropriate,
including to the extent necessary to comply with the rules, regulations and policies of the
Midwest League, Minor League Baseball and the Office of the Commissioner of Major
League Baseball. Nothing in this Lease Agreement shall be enforced against the Club in a
manner that would cause the Club to violate such rules, regulations or policies of the Club's
governing baseball organizations m~d/or if such enforcement would cause the Club's
franchise issued by Minor League Baseball or its membership in the Midwest League to be
restricted, terminated or revoked.
Signature page follows.
22
IN WITNESS WHEREOF, the parties have executed this Lease Agreement
effective as of the day and yem' f~rst above written.
A~e~:
City of Dubuque, Iowa ("City")
By: By:
Jeanne F. Sclmeider
City Clerk
Terry Duggan
Mayor
Riverside Baseball, LLC ("Club")
By:
Michael G. Gartner
President
By:
Michael A. Giudicessi
Secretary
STATE OF IOWA )
) SS.
COUNTY OF DUBUQUE
The foregoing instrument was acknowledged before me this __ day of
~ 2003, by Ten'y Duggan and Jeanne F. Schneider, the Mayor and City Clerk
respectively of the City of Dubuque, Iowa, an Iowa municipal corporation, on behalf of said
Iowa municipal corporation.
Notm'y Public
STATE OF IOWA )
) SS.
COUNTY OF POLK )
The foregoing instnm~ent was acknowledged before me this __ day of
~ 2003, by Michael G. Garmer, the President of Riverside Baseball, LLC, an
Iowa limited liability company, and Michael A. Giudicessi, the Secretary of Riverside
Baseball, LLC, an Iowa limited liability company, on behalf of said Iowa limited liability
company.
Notm*y Public
23
EXHIBIT A
Description of Leased Premises
That part of the real property in the City of Dubuque, Iowa, shown on Exhibit A-1
attached hereto, which is within the area bounded on the east by Bell Street, on the north and
west by the Canadian National/Illinois Central Railroad right of way, and on the south by
East FitSh Street, excepting therefi'om the following: Lots 7,8,9,10,11, 2 of 12, 2 of 13, 2 of
14, 2 of 15 and the southeasterly 6 feet of Lot 6 ali in Block 29 of Dubuque Harbor
Improvement Company's Addition and also excepting Lot A of 11 and Lot 2 of 11 of
Industrial Subdivision No. 2 all in the City of Dubuque, Dubuque County, Iowa.
24
EXI~IBIT A-1
Conceptual Plan
25
SCIYEDULE 1
HOK Site and Facilities Desien
[Will be attached and incorporated upon completion]
26
INSURANCE SCHEDULE A
INSURANCE REQUIREMENTS FOR TENANTS AND LESSEES OF CITY' PROPERTY
OR VENDORS (SUPPLIERS, SERVICE PROVIDERS) TO THE CITY OF DUBUQUF
1. All policies of insurance required hereunder shall be with an insurer authorized to
do business in Iowa. Ail insurers shall have a rating of A of better in the current
A.M. Best Rating Guide.
2. All policies of insurance shall be endorsed to provide a thirty (30) day advance
notice of cancellation to the City of Dubuque if cancellation is prior to the
expiration date. This endorsement supersedes the standard cancellation
statement on the Certificate of Insurance.
3. The Club shall furnish a Certificate of Insurance to the City of Dubuque, Iowa
for the coverage required in Paragraph 6 below. Such certificates shall
include copies of the fo/lowing policy endorsements:
a) Thirty day notice of cancellation to the City of Dubuque.
b) Commercial General Liability policy is primary and non-contributing.
c) Commercial General Liability additional insured endorsement.
d) Governmental Immunity Endorsements.
e) Waiver of recovery under workers compensation.
4. Each certificate shall be submitted to the contracting department of the City of
Dubuque.
Failure to provide minimum coverage shall not be deemed a waiver of these
requirements by the City of Dubuque. Failure to obtain or maintain the
required insurance shall be considered a material breach of this agreement.
6. The Club shall be required to carry the following minimum coverage/limits or
greater if required by law'or other legal agreement:
a) COMMERCIAL GENERAL LIABILITY
General Aggregate Limit $2,000,000
Products-Completed Operations Aggregate Limit $1,000,000
Personal and Advertising Injury Limit $1,000.000
Each Occurrence Limit $1,000,000
Fire Damage Limit (any one occurrence) $ 50.000
Medical Payments $ 5,000
This coverage shall be written on an occurrence, not claims mad e, form
per location. Ail deviations or exclusions from the standard ISO
2?
commercial general liability form CG 0001 or Businessowners form BP
0002 shall be clearly identified.
Governmental Immunity Endorsement identical or equivalent to form
attached.
An additional insured endorsement identical or equivalent to ISO Form
CG 2026 or CG 2011 and include as additional insureds: "The City of
Dubuque, including all its elected and appointed officials, all its
employees and volunteers, all its boards, commissions and/or
authorities and their board members, employees, and volunteers.*
b) WORKERS' COMPENSATION & EMPLOYERS LIABILITY
Statutory for Coverage A
Employers Liability:
$100,000 each accident
$100,000 each employee-disease
$500,000 policy limit--disease
Policy shall include an endorsement waiving right of recovery
against City of Dubuque.
c) UMBRELLA/EXCESS LIABILITY $5,000,000
d) LIQUOR OR DRAM SHOP LIABILITY $1,000,000
POLICY NUMBER COMMERCIAL GENERAL LIABILITY
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.
ADDITIONAL INSURED - DESIGNATED PERSON OR
ORGAN IZATION
This endorsement modifies insurance provided under the following:
COMMERCIAL GENERAL LIABILITY COVERAGE PART.
SCHEDULE
Name of Person or Organization:
The City of Dubuque, including all its elected and appointed officials, all its employees and volunteers, all
its boards, commissions and/or authorities and their board members, employees, and volunteers.
(If no entry appears above, information required to complete this endorsement will be shown in the
Declarations as applicable to this endorsement.)
WHO IS AN INSURED (Section II) is amended to include as an insured the person or organization shown
in the Schedule as an insured but only with respect to liability arising out of your operations or premises
owned by or rented to you.
Copyriqht. Insurance Services Office. Inc. 1994
CG 20 26 11 85
CITY OF DUBUQUE, IOWA
GOVERNMENTAL IMMUNITIES ENDORSEMENT
Nonwaiver of Governmental Immunity. The insurance carder expressly agrees
and states that the purchase of this policy and the including of the City of
Dubuque, Iowa as an Additional Insured does not waive any of the defenses of
governmental immunity available to the City of Dubuque, Iowa under Code of
Iowa Section 670.4 as it is now exists and as it may be amended from time to
time.
Claims Coveraqe. The insurance carrier further agrees that this policy of
insurance shall cover only those claims not subject to the defense of
governmental immunity under the Code of Iowa Section 670.4 as it now exists
and as it may be amended from time to time. Those claims not subject to Code of
Iowa Section 670.4 shall be covered by the terms and conditions of this
insurance policy.
Assertion of Government Immunity. The City of Dubuque, Iowa shall be
responsible for asserting any defense of governmental immunity, and may do so
at any time and shall do so upon the timely written request of the insurance
carrier.
Non-Denial of Coveraqe. The insurance carrier shall not deny coverage under
this policy and the insurance carrier shall not deny any of the rights and benefits
accruing to the City of Dubuque, Iowa under this policy for reasons of
governmental immunity unless and until a court of competent jurisdiction has
ruled in favor of the defense(s) of governmental immunity asserted by the City of
Dubuque, Iowa.
.No Other Chanqe in Policy. The above preservation of governmental immunities
shall not otherwise change or alter the coverage available under the policy.
DSMSl:40046093,14
I1/3/03 10:15 AM
3O
EXHIBIT B