ConAgra Foods Assignment of LeasesTHE CITY OF Dubuque
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TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Assignment of Leases by ConAgra Foods, Inc.
DATE: April 30, 2008
City Attorney Barry Lindahl advises that the City has received a request from ConAgra
Foods, Inc. for the City to consent to the assignment of three leases with the City of
Dubuque from ConAgra Foods, Inc. to Freebird II, LLC.
City Attorney Barry Lindahl recommends that the Assignment and Assumption
Agreements be approved and that the City consent to the assignment.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
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Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
THE CTTY OF
DUB MEMORANDUM
Masterpiece on the
BARRY LINDA L
CITY ATTORN Y
To:
I C. Van Milligen,
City Manager
DATE: April 22, 2008
RE: Assignment of Leases by ConAgra Foods, Inc.
Enclosed is a letter I received from ConAgra Foods, Inc. counsel Christopher B.
Aupperle.
ConAgra Foods, Inc. currently has three leases with the City of Dubuque. ConAgra
Foods, Inc. has recently announced that it has reached an agreement to sell its
commodity trading and merchandising operations conducted by ConAgra Trade Group
to the Ospraie Special Opportunities fund. ConAgra Trade Group will be renamed
Gavilon LLC and a subsidiary of Gavilon LLC, Freebird II, LLC, will operate on the
leased property.
ConAgra Foods, Inc. is requesting that the City of Dubuque consent to the assignment
of the three leases from ConAgra Foods, Inc. to Freebird II, LLC. Freebird II, LLC has
agreed to assume all of the obligations and liabilities of ConAgra Foods, Inc., under the
leases.
I would recommend that the Assignment and Assumption Agreements be submitted to
the City Council for consideration and approval and that the City consent to the
assignment.
BAL:tIs
Enclosure
cc: Steve Sampson Brown, Project Manager
Jeanne Schneider, City Clerk (Originals enc.)
F:\USERS\tsteckle\Lindahl\Memos\MVM_Assig nmentOfLeasesByConAgraFoods_042208.doc
OFFICE OF THE CITY ATTORNEY DUBUQUE, IOWA
SUITE 330, HARBOR VIEW PLACE, 300 MAIN STREET DUBUQUE, IA 52001-6944
TELEPHONE (563) 583-4113 / FAx (563) 583-1040 / EMAIL balesq@cityofdubuque.org
April 21, 2008
Barry A. Lindahl
City Attorney
City of Dubuque, Iowa
300 Main Street
Dubuque, IA 52001
RE: Consent to Assignment of Leases
Dear Barry,
ConASra Foods, Inc.
Five ConAiia Drive, 5-4i6
Omaha, Nebraska 68io2-5ooi
TEL: 402-595-70
Christopher B. Aupperle
Counsel
Lego! and Communications
ConAgra Foods, Inc. currently has three leases with the City of Dubuque for operations
located in Dubuque, Iowa. As we discussed in our phone call, ConAgra Foods, Inc.
recently announced that it reached an agreement to sell its commodity trading and
merchandising operations conducted by ConAgra Trade Group to the Ospraie Special
Opportunities fund and other investors for approximately $2.1 billion, subject to certain
adjustments. The Ospraie Special Opportunities fund is an affiliate of Ospraie
Management, a leading investment management-firm focused exclusively on
commodities and basic industries with approximately $9 billion under management.
ConAgra Trade Group will be renamed Gavilon LLC upon completion of the sale. A
subsidiary of the new company, Freebird II, LLC will operate the over 70 grain elevators
included in the transaction. A separate subsidiary of the new company will operate the
fertilizer operations.
Greg Heckman, the current president of the ConAgra Foods commercial businesses, will
become chief executive of Gavilon upon close of the transaction. Virtually all of the
approximately 950 employees of ConAgra Trade Group will become employees of
Gavilon. The agreement includes approximately 144 facilities, located primarily in North
America. Gavilon will conduct grain and byproducts merchandising and fertilizer
distribution, as well as agriculture, energy and other commodity trading activities, and
risk management services.
In order to facilitate the sale, ConAgra Foods is requesting that the city of Dubuque
consent to the assignment of the leases from ConAgra Foods to Freebird II, LLC. I have
enclosed proposed assignments and consents for your review.
You will note that Freebird II LLC is agreeing to assume all of the tenant's obligations
under the lease. You will also note that ConAgra Foods is requesting to be released
from liability following the assignment. This is consistent with the manner in which the
City of Dubuque has consented to previous assignments on these leases.
If you have any questions, please feel free to contact me at (402) 595-7068. Based on
the timing of our transaction, I would like to be on the agenda for the May 5, 2008 City
Council meeting for consideration of our request. if that is not possible, please let me
know at your earliest convenience.
Sincerely yours,
3 ~~'
Christopher B. Aupperle
Counsel
cc: Gene Reibel
Enclosure
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Assignment ") is made
and entered into this day of May, 2008, by and between ConAgra Foods, Inc., a Delaware
corporation, formerly known as ConAgra, Inc., successor to Pillsbury Company and Swift
Agricultural Chemicals Corporation ( "Assignor ") and Freebird II, LLC, a Delaware limited liability
company ( "Assignee ").
A. Assignor, as tenant, and The City of Dubuque, Iowa, a municipal corporation, as
landlord ( "Landlord "), entered into that certain lease agreement dated November
29, 1971, (the "Lease "), for that certain property located in Dubuque, Iowa and
more legally defined in Exhibit A to the Lease (the "Leased Premises "); and
B. Assignor now desires to assign all of its right, title and interest in and to the Lease
and the Leased Premises to Assignee and Assignee desires to receive and
accept such assignment.
NOW, THEREFORE, in consideration of the sum of Ten and No /100 Dollars ($10.00)
and other valuable consideration, receipt of which is hereby acknowledged by Assignor, and
pursuant to Article 17 of the Lease, the parties hereto hereby agree as follows:
1. Assignment. Effective as of the Effective Date (as defined below), Assignor
hereby assigns, transfers, conveys and delivers to Assignee all of its right, title and interest in
and to the Lease and the Leased Premises.
2. Assumption. Assignor hereby assigns, and Assignee hereby assumes and
agrees to pay, discharge or perform when due all of the obligations and liabilities of Assignor, on
or after the Effective Date, that are under and related to the Lease and the Leased Premises.
3. Effective Date. This Assignment shall take effect on May 23, 2008 ( "Effective
Date "), and Assignor shall give possession of the Leased Premises to Assignee on that date,
4. No Third Party Beneficiaries, This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective successors and assigns, and nothing
herein, express or implied, is intended to or shall confer upon any other person any legal or
equitable right, benefit or remedy of any nature whatsoever under or by reason of this
Assignment.
5. Landlord's Consent. This Assignment is conditioned upon obtaining the written
consent of Landlord.
6. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state in which the Leased Premises is located.
[Signatures on following page]
Page 1 of 2
LANDLORD'S CONSENT
The City of Dubuque, Iowa, as Landlord in the Lease, hereby consents to the above Assignment
and confirms that the Lease is in full force and effect. Landlord agrees to release Assignor for
any and all liability pursuant to the Lease following the Effective Date.
DATED: May 5, 2008
LANDLORD
The City of Dubuque, Iowa
By:
Name:
Its:
Page 2 of 2
IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be duly
executed as of the day and year first above written.
ASSIGNOR: ConAgra Foods, Inc.
ASSIGNEE: Freebird II, LLC
By: _4---w By.
Name: .,5ca,0 E'1 /Y7e ( Nam
Its:vvAtor• Vicc. Prseskcics k I—Pea3vrer, Its:
LANDLORD'S CONSENT
The City of Dubuque, Iowa, as Landlord in the Lease, hereby consents to the above Assignment
and confirms that the Lease is In full force and effect. Landlord agrees to release Assignor for
any and all liability pursuant to the Lease following the Effective Date.
DATED: '%'j S, X08
LANDLORD:
The City of Dubuque, Iowa
By:
Name:
Its:
Page2of2