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Sale of City Owned Property_1126 White StreetTO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Sale of City-Owned Property at 1126 White Street DATE: July 15, 2008 The City Council authorized the purchase of the vacant and derelict nine-unit apartment building on White Street from the Dubuque Community School District with the intent of selling it to a developer to create some owner-occupied condominiums in the neighborhood. The School District had purchased the properties as part of the Prescott School Construction project. A Request for Proposal was issued and three responses were received. Housing and Community Development Department Director David Harris is recommending sale of the property to Horsfall, Inc. The proposal submitted by Doug Horsfall has received the committee's unanimous recommendation. A total of five condominiums will be developed in the former nine-unit building. These will consist of two first-floor units, measuring about 1,400 square feet for the two-bedroom and 750 square feet for the one-bedroom. On the upper two floors, three two-story condominiums will be developed, each with two bedrooms and two bathrooms, measuring approximately 1,450 square feet each. Five garages will be constructed in the rear of the site, at the alley; five additional surface parking spaces will be included. A gated entry will provide security at the rear courtyard. A covered stairway will allow an exterior entrance to the units at the rear; decks will be constructed for each condominium, on each of the three floors. In addition to the previously approved financing package, the Development Agreement includes the following to respond to the developer's request that the City share in the risk of this untested housing model in this neighborhood: 1. The developer receives no less than $10,000 from the sale proceeds of any unit. 2. Subject to 1 above, at sale of each condo unit, the developer will pay to the City a mortgage release amount equal to 80% of the sale proceeds (after real estate commissions), to be applied against the Iowa Finance Authority $500,000 construction loan and will receive a release of the unit from that construction loan mortgage. The buyer will assume one-fifth of the $125,000 loan, which is a City furnished second mortgage in addition to the IFA loan. 3. The sale price of any unit must be approved by the City. 4. After the approved sale of the last condominium unit, the City will forgive any unpaid balance on the IFA loan. 5. After completion of construction, the City will pay the developer one-half of the on- going property taxes, condominium fees, insurance, utilities and maintenance costs incurred by the developer for unsold units. The risk-sharing agreement requested by the developer results in open-ended financing for the City. If the total sale price for the units does not cover the IFA construction loan, the City will subsidize the difference. For instance, if, instead of selling the condominiums at the break-even prices of $110,000 -151,000, they were sold at $84,000 -131,000, the additional write-down on the IFA loan could be $90,000, or $18,000 per unit. This is not inconsistent with some of the Washington Neighborhood deals approved by the Housing Commission during the past two years, particularly for the HEART Program homes. General Funds for homeownership financing in the neighborhood are available for this purpose. In addition, by agreeing to share in the carrying cost of unsold units, the City will incur expenses in an unknown amount, until all the condominiums are purchased. These will primarily consist of condominium fees and insurance. Interest costs on the IFA construction loan are not included in this obligation. As the project was conceived, an additional benefit was the participation of HEART Program students. This was included as an optional feature in the RFP and the City encouraged responding developers to consider ways to involve the students. With the Horsfall proposal, there will be significant involvement. In particular, the new garages constructed at the rear of the property will be HEART-built. The students have already completed some preliminary demolition work and will resume their activities once school resumes in August. The benefits to the City include: 1. Re-occupancy of along-derelict apartment building, a source of blight to the area for many years. 2. Restoration of a significant 1890's-era historic property, a contributing structure to the original Old Town Residential Neighborhood. 3. Addition of five owner-occupied units to the neighborhood. 4. A `test' of the condominium market in the area, particularly of the feasibility of converting older `excess' rental units for the young professionals/singles market in the downtown. 5. Fulfillment of an agreement with the Dubuque Community School District - in exchange for a considerable write-down of their purchase cost - to restore this property and enhance the Prescott School campus. 6. A significant partnership with the HEART Program 7. Promotion of 'green' approach: recognizing that adaptive re-use of existing buildings is the best way to "recycle" those resources, while respecting the historic environment of Dubuque's older downtown neighborhoods. 8. Ahigh-profile implementation project of the Washington: Revitalize strategy, to improve the quality of life in the Washington Neighborhood. This continues the partnership between the City of Dubuque and the Dubuque Community School District to revitalize the Washington Street Neighborhood. Previous elements of this partnership include the Dubuque Community School District construction of Prescott School, the incorporation of a Neighborhood Resource Center in the school, the new City policy allowing City employees 30 minutes a week on City time to mentor a student at the Dubuque Community School District, the numerous City- sponsored after school programs in the targeted schools, the sale of the Kephart's Building to the City for the expansion of the Multi-Cultural Center and the inclusion of the Dubuque Community School District English Language Learner instructional services in the Multi-Cultural Center. I concur with the recommendation and respectfully request Mayor and City Council approval. Michael C. Van Milligen MCVM/jh Attachment cc: John Burgart, Dubuque Community School District Superintendent Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager David Harris, Housing and Community Development Department Director TO: Michael Van~igen, City Manager FROM: David ~ ris, Housing and Community Development Department SUBJECT: Sale of City-owned Property at 1126 White Street DATE: 7 July 08 Introduction The purpose of this memorandum is to request the City Council to authorize sale of the property at 1126 White Street to Horsfall Inc, for the purpose of its conversion to condominiums and resale to owner occupants. Background The City Council authorized purchase of the vacant and derelict 9-unit apartment building on White Street, from the Dubuque Community School District, in June 07, for $50 000. Prior to purchase, the Housing Department had published a Request for Proposals, in April, seeking interest from a developer to purchase and convert the building to condos for `young professionals' working in the downtown. This project was conceived to complement the Washington Neighborhood revitalization strategy promoting homeownership and a mix of household incomes, as part of an effort to stabilize the area and reverse the imbalance of renter-occupied properties. In response to the RFP, proposals were received from Tricon Construction and Winger Construction. A review committee, consisting of AI Lundh, John Gronen, Building Department Manager Rich Russell, and Housing staff Dick Firzlaff, Bob Boge, Joe Kirk and David Harris reviewed the proposals and interviewed the respondents. A preliminary choice was made for Tricon, which requested and was granted additional time to conduct a market survey in order to determine pricing and amenities for the units. Unfortunately, Tricon subsequently withdrew their proposal, due to health considerations of one of the principal owners of the firm. A second RFP was then published by the Housing Department in January 08. In response, the review committee received proposals from Dubuque Property Management LLC, Freedom Development Company and Horsfall Inc. Discussion The proposal submitted by Doug Horsfall has received the committee's unanimous recommendation. A total of five condominiums will be developed in the former nine unit building. These will consist of two first-floor units, measuring about 1400 square feet for the two-bedroom and 750 square feet for the one-bedroom. On the upper two floors, three two-story condos will be developed, each with two bedrooms and two bathrooms, measuring approximately 1450 square feet each. Five garages will be constructed in the rear of the site, at the alley; five additional surface parking spaces will be included. A gated entry will provide security at the rear courtyard. A covered stairway will allow an exterior entrance to the units at the rear; decks will be constructed for each condo, on each of the three floors. Doug Horsfall, dba Horsfall Inc., is based in Asbury; Doug has primary experience as a builder of quality new homes in the area. His work and reputation are excellent. He has been represented in discussions with City staff by Chad Wagoner, from DB&T; and by attorney Bill Conzett. To further review the project design and concept, an ad hoc group of market professionals was convened. This included Lynn Juergens, Chad Wagoner and Bill Callahan from DB&T; realtor Doris Hingtgen and appraiser Tom Kane. The design, including open floor plans, secured entries, off-street parking and individual decks, was endorsed. It was agreed that unit sale prices in the $100/square foot range could be supported by appraised values. In particular, it was agreed that the financing available for this project would be of major benefit in marketing the condos. Financing According to the project concept initially approved by the City Council, the building is to be sold to the developer for $1.00. In addition, a $50 000 grant from General Funds allocated for this purpose is to be made to the developer. A $500 000 FirstHome loan has been obtained by the City from the Iowa Finance Authority, to be made available as construction financing, at 3% interest. This loan has a 10-year term. Additional financing will be made available as part of the Washington Neighborhood revitalization lending package. This consists of $125 000 -initially used by the developer as construction financing and then assumed by the unit buyers - at no interest and no payments. Horsfall's development budget has been calculated at $700 000. Realtor fees added to this total are estimated at $35 000. With the City grant of $50 000, the $500 000 IFA construction loan and the additional $125 000 in City "pass-through" funds, the developer is receiving 92% financing for the project. With a profit calculation of $50 000, the return to the developer is 7%. Unit buyers would each assume $25 000 in "pass-through" financing (the $125 000 divided by five units), as a second mortgage from the City. In addition, each would receive a forgivable $5000 loan for downpayment financing. A total of $30 000 in City financing will be received by each unit buyer (a combination of forgivable, deferred- payment and 0% interest loans), at a total monthly payment of $42. Dubuque Bank and Trust, our current lending partner in the Washington revitalization effort, is offering 4.95% interest on first mortgage financing. In summary, the financing scenario: $700 000 development cost 35 000 realtor fees $735 000 total project cost $ 50 000 City grant 500 000 IFA FirstHome first mortgage 125 000 City second mortgage -passed thru to unit buyers $675 000 Unit buyer financing: $110 000 - $151 000 unit sale prices - 25 000 $ 85 000 - $126 000 - 5 000 $ 80 000 - $121 000 City pass-thru financing City downpayment loan First mortgage needed by unit buyer As the property is located in an Urban Revitalization District, no taxes are paid on improvements for ten years. Coupled with the residential roll-back, unit buyers will literally pay no real estate taxes for their homes. For these reasons, the cost of purchasing and operating the condominiums is quite market competitive. To realize break-even on the project budget, the developer must sell the units at a range of $110 000 to $151 000; prices vary according to size. The PITT (principal, interest, taxes and insurance) cost on a unit selling for $150 000 is $723 per month. For this, the buyer purchases a 1450 square foot unit, with two bedrooms, two baths and off-street parking (one garage.) For a unit selling at $110 000, the PITI payment is about $488. Only IFA income limits apply: for atwo-person household, this is $71 400. Development agreement We are reasonably certain that we have a quality developer and a project design and financing package that can compete in the market. The unknown variable is buyer interest. Given that the project is "ahead of the curve" of the downtown condo/town home market, its marketability is an unanswered question. For this reason, the developer has requested some hedge against risk, i.e., his inability to sell the units at the break-even prices, or within a reasonable time frame. A development agreement has been prepared by Assistant City Attorney Tim O'Brien to reflect the negotiations with the developer. The points of the agreement which respond to the developer's concerns are as follows: 1. The developer receives no less than $10 000 from the sale proceeds of any unit. 2. Subject to 1. above, at sale of each condo unit, the developer will pay to the City a mortgage release amount equal to 80% of the sale proceeds (after real estate commissions), to be applied against the IFA $500 000 construction loan and will receive a release of the unit from that construction loan mortgage. The buyer will assume 1/5 of the $125 000 loan. 3. The sale price of any unit must be approved by the City. 4. After the approved sale of the last condominium unit, the City will forgive any unpaid balance on the IFA loan. 5. After completion of construction, the City will pay the developer one-half of the on-going property taxes, condominium fees, insurance, utilities and maintenance costs incurred by the developer for unsold units. The risk-sharing agreement requested by the developer results in open-ended financing for the City. If the total sale price for the units does not cover the IFA construction loan, the City will subsidize the difference. For instance, if, instead of selling the condos at the break-even prices of $110 000 -151 000, they were sold at $84 000 -131 000, the additional write-down on the IFA loan could be $90 000, or $18 000 per unit. This is not inconsistent with some of the Washington Neighborhood deals approved by the Housing Commission during the past two years, particularly for the HEART Program homes. General Funds for homeownership financing in the neighborhood are available for this purpose. In addition, by agreeing to share in the carrying cost of unsold units, the City will incur expenses in an unknown amount, until all the condominiums are purchased. These will primarily consist of condo fees and insurance. Interest costs on the IFA construction loan are not included in this obligation. HEART Program As we conceived this project, an additional benefit was the participation of HEART Program students. This was included as an optional feature in the RFP and we encouraged responding developers to consider ways to involve the students. With the Horsfall proposal, we will have significant involvement. In particular, the new garages constructed at the rear of the property will be HEART-built. The students have already completed some preliminary demolition work and will resume their activities once school resumes in August. Recommendation It is recommended that the Council approve sale of the property to Doug Horsfall/Horsfall Inc, under the terms and conditions of the Development Agreement, attached. Although some financial uncertainty results for the City, the Agreement represents a reasonable sharing of risk on amarginally-profitable project. And the benefits to the City are numerous, including: 1. Re-occupancy of along-derelict apartment building, a source of blight to the area for many years. 2. Restoration of a significant 1890's-era historic property, a contributing structure to the original Old Town Residential Neighborhood. 3. Addition of five owner-occupied units to the neighborhood. 4. A `test' of the condominium market in the area, particularly of the feasibility of converting older `excess' rental units for the young professionals/singles market in the downtown. 5. Fulfillment of an agreement with the Dubuque Community School District - in exchange for a considerable write-down of their purchase cost - to restore this property and enhance the Prescott School campus. 6. A significant partnership with the HEART Program 7. Promotion of `green' approach: recognizing that adaptive re-use of existing buildings is the best way to "recycle" those resources, while respecting the historic environment of our older downtown neighborhoods. 8. Ahigh-profile implementation project of our Washington: Revitalize strategy, to improve the quality of life in the Washington Neighborhood. Action Step The action requested of the City Council is to approve the attached resolution, authorizing the sale of real estate located at 1126 White Street to Horsfall Inc., for $50 000. att RESOLUTION NO. 249 - 08 A RESOLUTION APPROVING THE SALE OF REAL ESTATE LOCATED AT 1126 WHITE STREET, IN THE CITY OF DUBUQUE, IOWA WHEREAS, the City acquired the property at 1126 White Street for the purpose of its redevelopment and re-use for owner-occupied housing; and WHEREAS, such purpose supports the Washington Neighborhood revitalization strategy as approved by the City Council; and WHEREAS, a qualifying proposal has been reveived from Horsfall Inc. to accomplish these objectives. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. That the City of Dubuque hereby approves the acquisition of the following legally-described property: The South Middle One-fifth (1/5) of Out Lot 480 in the City of Dubuque, Iowa according to the United States Commissioners Map thereof, at the cost of One dollar ($1.00) Section 2. That the City of Dubuque be and is hereby authorized to provide a Special Warranty Deed to the buyer, conveying the City's interest to Horsfall Inc for the herein described real estate. Section 3. That the City Clerk be and she is hereby authorized and directed to case said Special Warranty Deed to be recorded in the Office of the Dubuque County Recorder, together with certified copy of the Resolution. Section 4. That the City Clerk be and she is hereby directed to forward a copy of this Resolution to the Dubuque County Assessor and the Dubuque County Auditor. PASSED, APPROVED AND ADOPTED this 21st day of July, 2008 Roy D. Buol, Mayor Attest: Jeanne Schneider, CMC, City Clerk r a w _- r ., a ~ -,: } ~~ :s ,~ f 1 ~ ~- ,.. ~ 1~8~L-OSS-f95 s 30 i 30t~d NOIS3Q 4Nt/ LO81-95S-f95 ~~b aNduvo~ NO11Jf12115NOJ l~lb'35ZIOH O~IOQ 1J3f02fd 1332115 311HM 9ZI.1 ~~`d35~lOH 1.8~L-OSS-f9S L08L-95S-'f9S ll~/3S210H J~104 r r~ ~ m I ~ ~ ',. ~. __... ~ ~ a ~ ~ / c ~ ~m v - ~ ~ ~ nn~ d ~~ 9 Y;o A ~\ fJ ` ~ _.. _' m~ I I W ~ ~ ~~ 41 _ A _ .- f -- ~I ~ ~ ~--- ~ O 0 ~ , ~ ~ x qZq~ S~ g /1 ~ OM ~: r p O '' ~ ZQ ~ a ~ 9 W~ ~ ~~ C I ' QQ S. i i>+tl OD w10 ' I ~',~ R q T S ~ i A'Al x.8-.£ Qq MO'139 N3d0 l ~ ~ ~ ~ ~ ~ T k i ~, ~. -.aiE S,9 ws.v.nc~ ~ I . 5 I ~- w~ I E S Ox I i 9 y ~ °°~ n `! jF O < ~~ avn r. ~/1 .~ - i 4 , i i i ~ ' :~- ~ ~ O ~ ~ ~ I 4 .. _.....~ s 30 ~ 3Jdd NOLLb'/~3'13 N3HJ11~i QNt/ .lllO~ldl ~100"Li QN0735 1J3 f02[d 133y15 311 HM 9ZL1 N`J1534 dN`d N011J11~11SNOJ ll`d35210H DEVELOPMENT AGREEMENT BETWEEN THE CITY OF DUBUQUE AND HORSFALL, INC. This Agreement, dated for reference purposes the day of , 2008, by and between the City of Dubuque, Iowa, a municipality (City), established pursuant to the Iowa Code, and Horsfall, Inc., with its principal place of business in Dubuque, lowa(Developer). WHEREAS, in furtherance of the objectives of the Washington Neighborhood Urban Revitalization Area, City has issued a Request for Proposal for the development of property known as 1126 White St. in Dubuque, lowa(Project); and WHEREAS, the Project is located within the Washington Neighborhood Urban Revitalization Area; and WHEREAS, the Developer has submitted a proposal for the development of the Property which is acceptable to the City; and WHEREAS, Developer has requested that City sell to Developer the property known as 1126 White St., legally described on Exhibit B, attached, in the City of Dubuque, Dubuque County, Iowa, together with all easements, tenements, hereditaments, and appurtenances belonging thereto (the Property), so that Developer may develop the Property, for the construction, use and occupancy of the property as a five unit residential condominium, in accordance with the City's Request for Proposal and the Developer's proposal in response thereto and in accordance with this Agreement; and WHEREAS, City believes that the development of the Property pursuant to this Agreement, and the fulfillment generally of this Agreement, are in the vital and best interests of City and in accord with the public purposes and provisions of the applicable federal, state and local laws and the requirements under which the Project has been undertaken and is being assisted. NOW THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: SECTION 1. CONVEYANCE OF PROPERTY TO DEVELOPER 1.1 Purchase Price. The purchase price for the Property (the Purchase Price) shall be the sum of $1.00 which shall be due and payable by Developer in immediately available funds in favor of City, on or before , 2008, or on such other date as the parties may mutually agree (the Closing Date). 1.2 Title to Be Delivered. City agrees to convey good and marketable fee simple title in the Property to Developer subject only to easements, restrictions, conditions and covenants of record as of the date hereof to the extent not objected to by Developer as set forth in this Agreement, and to the conditions subsequent set forth in Section 5.3, below: (1) City, at its sole cost and expense, shall deliver to Developer an abstract of title to the Property continued through the date of this Agreement reflecting merchantable title in City in conformity with this Agreement and applicable state law. The abstract shall be delivered together with full copies of any and all encumbrances and matters of record applicable to the Property, and such abstract shall become the property of Developer when the Purchase Price is paid in full in the manner as aforesaid. (2) Developer shall have until time of the Closing Date to render objections to title, including any easements or other encumbrances not satisfactory to Developer, in writing to City. Developer agrees, however, to review the Abstract promptly following Developer's receipt of Developer's land survey and the Abstract and to promptly provide City with any objections to title identified therein. Nothing herein shall be deemed to limit Developer's rights to raise new title objections with respect to matters revealed in any subsequent title examinations and surveys and which were not identified in the Abstract provided by the City. City shall promptly exercise its best efforts to have such title objections removed or satisfied and shall advise Developer of intended action within ten (10) days of such action. If City shall fail to have such objections removed as of the Closing Date, or any extension thereof consented to by Developer, Developer may, at its sole discretion, either (a) terminate this Agreement without any liability on its part, and any sums previously paid to City by Developer (or paid into escrow for City's benefit) shall be returned to Developer with interest, or (b) take title subject to such objections. City agrees to use its best reasonable efforts to promptly satisfy any such objections. 1.3 Rights of Inspection, Testing and Review. Developer, its counsel, accountants, agents and other representatives, shall have full and continuing access to the Property and all parts thereof, upon reasonable notice to City. Developer and its agent and representatives shall also have the right to enter upon Property at any time after the execution and delivery hereof for any purpose whatsoever, including inspecting, surveying, engineering, test boring, performance of environmental tests, provided that Developer shall hold City harmless and fully indemnify City against any damage, claim, liability or cause of action arising from or caused by the actions of Developer, its agents, or representatives upon the 2 Property (except for any damage, claim, liability or cause of action arising from conditions existing prior to any such entry upon the Property), and shall have the further right to make such inquiries of governmental agencies and utility companies, and to make such feasibility studies and analyses as it considers appropriate. 1.4 Representations and Warranties of City. In order to induce Developer to enter into this Agreement and purchase the Property, City hereby represents and warrants to Developer that to the best of City's knowledge: (1) There is no action, suit or proceeding pending, or to the best of City's knowledge, threatened against City which might result in any adverse change in the Property being conveyed or the possession, use or enjoyment thereof by Developer, including, but not limited to, any action in condemnation, eminent domain or public taking. (2) No ordinance or hearing is now before any local governmental body that either contemplates or authorizes any public improvements or special tax levies, the cost of which may be assessed against the Property. To the best of City's knowledge, there are no plans or efforts by any government agency to widen, modify, or re-align any street or highway providing access to the Property and there are no pending or intended public improvements or special assessments affecting the Property which will result in any charge or lien be levied or assessed against the Property. (3) All leases, contracts, licenses, and permits between City and third parties in connection with the maintenance, use, and operation of the Property have been provided to Developer and City has provided true and correct copies of all such documents to Developer. (4) City has good and marketable fee simple title interest to the Property. (5) The Property has a permanent right of ingress or egress to a public roadway for the use and enjoyment of the Property. (6) There are no notices, orders, suits, judgments or other proceedings relating to fire, building, zoning, air pollution, health violations or other matters that have not been corrected. City has notified Developer in writing of any past notices, orders, suits, judgments or other proceedings relating to fire, building, zoning, air pollution or health violations as they relate to the Property of which it has actual notice (7) Payment has been made for all labor or materials that have been furnished to the Property or will be made prior to the Closing Date so that no lien for labor performed or materials furnished can be asserted against the Property. 3 (8) The Property will as of the Closing Date be free and clear of all liens, security interests, and encumbrances. (9) The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated by this Agreement do not and shall not result in any material breach of any terms or conditions of any mortgage, bond, indenture, agreement, contract, license, or other instrument or obligation to which City is a party or by which either the City or the Property being conveyed are bound, nor shall the execution, delivery and performance of this Agreement violate any statute, regulation, judgment, writ, injunction or decree of any court threatened or entered in a proceeding or action in which City may be bound or to which either City or the Property being conveyed may be subject. (10) City has duly obtained all necessary approvals and consents for its execution, delivery and performance of this Agreement, and that it has full power and authority to execute, deliver and perform its obligations under this Agreement. (11) The Property is free and clear of any occupants, and no party has a lease to or other occupancy or contract right in the Property that shall in anyway be binding upon the Property or Developer. (12) City represents and warrants that any fees or other compensation which may be owed to a broker engaged directly or indirectly by City in connection with the purchase and sale contemplated in this Agreement are the sole responsibility and obligation of City and that City will indemnify Developer and hold Developer harmless from any and all claims asserted by any broker engaged directly or indirectly by City for any fees or other compensation related to the subject matter of this Agreement. (13) City shall exercise its best efforts to cooperate with Developer in the development process. (14) City shall exercise its best efforts to resolve any disputes arising during the development process in a reasonable and prompt fashion. (15) With respect to the period during which City has owned or occupied the Property, and to City's knowledge after reasonable investigation with respect to the time before City owned or occupied the Property, no person or entity has caused or permitted materials to be stored, deposited, treated, recycled, or disposed of on, under or at the Property, which materials, if known to be present, would require cleanup, removal or some other remedial action under environmental laws. 4 (16) The representations and warranties contained in this article shall be correct in all respects on and as of the Closing Date with the same force and effect as if such representations and warranties had been made on and as of the Closing Date. (17) All city utilities necessary for the development and use of the Property as an industrial manufacturing facility adjoin the Property and Developer shall have the right to connect to said utilities, subject to City's connection fees. 1.5 Conditions to Closing. The closing of the transaction contemplated by this Agreement and all the obligations of Developer under this Agreement are subject to fulfillment, on or before the Closing Date, of the following conditions: (1) The representations and warranties made by City in Section 1.4 shall be correct as of the Closing Date with the same force and effect as if such representations were made at such time. At the closing, City shall deliver a certificate to that effect in the form of Exhibit G. (2) Title to the Property shall be in the condition warranted in Section 1.4. (3) Developer, in its sole and absolute discretion, having completed and approved of any inspections done by Developer hereunder. (4) Developer and City shall be in material compliance with all the terms and provisions of this Agreement. 1.6 Closin The closing of the purchase and sale shall take place on the Closing Date. Exclusive possession of the Property shall be delivered on the Closing Date, in its current condition and in compliance with this Agreement, including City's representations and warranties regarding the same. Consummation of the closing shall be deemed an agreement of the parties to this Agreement that the conditions of closing shall have been satisfied or waived. 1.7 City's Obligations at Closing. At or prior to the Closing Date, City shall: (1) Deliver to Developer City's duly recordable Special Warranty Deed (in the form attached hereto as Exhibit C) to the Property conveying to Developer marketable fee simple title to the Property and all rights appurtenant thereto, subject only to easements, restrictions, conditions and covenants of record as of the date hereof and not objected to by Developer as set forth in this Agreement, and to the conditions subsequent set forth in Section 5.3 below. (2) Deliver to Developer the Abstract of Title to the Property. (3) Deliver to Developer such other documents as may be required by this Agreement, all in a form satisfactory to Developer. 1.8 Delivery of Purchase Price; Obligations At Closing. At closing, and subject to the terms, conditions, and provisions hereof and the performance by City of its obligations as set forth herein, Developer shall pay the Purchase Price to City pursuant to Section 1.1 hereof, but subject to Developer receiving an offsetting credit pursuant to Section 3.1 below. 1.9 Closing Costs. The following costs and expenses shall be paid in connection with the closing: (1) City shall pay: (a) The transfer fee, if any, imposed on the conveyance. (b) A pro-rata portion of all taxes, if any, as provided in Section 1.10. (c) All special assessments, if any, whether levied, pending or assessed. (d) City's attorney's fees, if any. (e) City's broker and/or real estate commissions and fees, if any. (2) Developer shall pay the following costs in connection with the closing: (a) The recording fee necessary to record the Deed. (b) Developer's attorney's fees. (c) Developer's broker and/or real estate commissions and fees, if any. (d) A pro-rata portion of all taxes as provided in Section 1.10. (e) The cost of recording any mortgages. 1.10 Real Estate Taxes. City shall pay all real estate taxes for all fiscal years that end prior to the Closing Date. Real estate taxes for the fiscal year in which the 6 Closing Date occurs shall be prorated between City and Developer to the Closing Date on the basis of a 365-day calendar year. Developer shall pay or cause to be paid all real estate taxes due in subsequent fiscal years. Any proration of real estate taxes on the Property shall be based upon such taxes for the year currently payable. SECTION 2. DEVELOPMENT ACTIVITIES 2.1 Required Improvements. City acknowledges that Developer is building a five unit residential condominium on the Property. Specifically, Developer is charged with constructing the building and certain internal systems thereto, and with finishing the building including, without limitation, all interior improvements (the Project); all as more particularly depicted and described in the Developers response to City's Request for Proposals delivered to City 2.2 Timing of Improvements. Developer hereby agrees that construction of the Project on the Property shall be commenced within three (3) months after the Closing Date, and shall be substantially completed by 2009. The time frames for the performance of these obligations shall be suspended due to unavoidable delays meaning delays, outside the control of the party claiming its occurrence in good faith, which are the direct result of strikes, other labor troubles, unusual shortages of materials or labor, unusually severe or prolonged bad weather, acts of God, fire or other casualty to the Project, litigation commenced by third parties which, by injunction or other similar judicial action or by the exercise of reasonable discretion directly results in delays, or acts of any federal, state or local government which directly result in extraordinary delays. The time for performance of such obligations shall be extended only for the period of such delay. SECTION 3. CITY PARTICIPATION 3.1 Acquisition Grant to Developer. For and in consideration of Developer's obligations hereunder to construct the Project, City agrees to make a Grant to Developer on the Closing Date, or such other date as the parties shall mutually agree upon in writing, in the amount of $50,000.00 Dollars 3.2 Loans to Developer. For and in consideration of Developer's obligations hereunder to construct the Project, City agrees to make the following loans to Developer on the Closing Date, or such other date as the parties shall mutually agree upon in writing: a. Construction loan secured by a first mortgage in the principal amount of $500,000.00 at 3% interest per annum, with a term of up to ten years and a unit release amount equal to 80% of the sale proceeds of the unit after payment of real estate sale commissions, provided that in no event shall the developer receive less than $10,000.00 from the sale proceeds of any unit. The sale price of any unit must 7 have the approval of the City in writing prior the execution of any agreement for the sale of the unit by the Developer, which approval shall not be unreasonably withheld. After the approved sale of the last condominium unit by Developer, City shall forgive any unpaid balance on this loan. b. Construction loan secured by a second mortgage in the principal amount of $125,000.00 at 0% interest per annum, with a term of up to ten years. The entire balance of this loan shall be due ten years from the date of Closing. A portion of this loan may be assigned assumed by the purchaser of each of the condominium units. The maximum amount assumable by any condominium unit purchaser shall be $25,000.00. City agrees to subordinate this assigned and assumed portion of this loan to purchaser's permanent financing. At the time of closing on the sale of any condominium unit City agrees to rewrite the loan terms of the assumed loan of $25,000.00 as follows: $5,000.00 of the loan will be forgiven after occupancy by the purchaser for 5 years; if sold by purchaser prior to five years of occupancy by purchaser, the entire $5,000.00 shall be due on sale of the unit; $10,000.00 at 0% interest, no monthly payment, due on sale of the unit; $10,000.00 at 0% interest per annum payable over 20 years at the rate of $42.00 per month, due on sale of the unit. 3.3 Sharing of Certain Costs. After completion of the Project, City agrees to pay Developer one-half of the real property taxes, condominium fees, insurance, utilities and maintenance costs incurred by the Developer for unsold condominium units. 3.4 Disbursement and Use of Grant and Loan Proceeds. City shall disburse Grant and Loan funds to Developer for Qualifying Project Expenses only. The first disbursements shall be from the $125,000.00 loan. Developer shall furnish to City written requests for disbursement of funds in the form attached hereto as Exhibit E, detailing Developer=s Project expenses and including appropriate documentation of such expenses. It is expressly understood that all funds advanced under this Agreement shall be specifically earmarked and used by Developer only for the purpose of paying the Qualifying Project Expenses listed in the applicable written request. City shall not be obligated to pay any funds not drawn by Developer as of said date of completion of the Project and any undrawn funds shall be credited against the balance due on the $500,000.00 loan. 3.5 Qualifying Project Expenses. Qualifying Project Expenses shall mean only those expenditures or expenses incurred by Developer during and for the Project, whether paid to third parties or incurred as wage expense, fringe benefit expense or other costs of Developer's employees, agents and contractors. Payment of interest on the $500,000.00 loan shall be considered a Qualifying Project Expense. SECTION 4. COVENANTS OF DEVELOPER 4.1 Books and Records. During the term of this Agreement, Developer shall 8 keep at all times proper books of record and account in which full, true and correct entries will be made of all dealings and transactions of or in relation to the business and affairs of Developer in accordance with generally accepted accounting principles consistently applied throughout the period involved, and Developer shall provide reasonable protection against loss or damage to such books of record and account. 4.2 Real Property Taxes. From and after the Closing Date, Developer shall pay or cause to be paid, when due, all real property taxes and assessments payable with respect to all and any parts of the Property unless Developer's obligations have been assumed by another person pursuant to the provisions of this Agreement. 4.3 Insurance Requirements. (1) Developer shall provide and maintain or cause to be maintained at all times during the process of constructing the Project (and, from time to time at the request of City), furnish City with proof of insurance in the form of a certificate of insurance for each insurance policy: (a) All risk builder's risk insurance, written on a Completed Value Form in an amount equal to one hundred percent (100%) of the replacement value when construction is completed; (b) Insurance as set forth in the attached Insurance Schedule A. (2) Upon completion of construction of the Project, Developer shall maintain, or cause to be maintained, at its cost and expense (and from time to time at the request of City shall furnish proof of insurance in the form of a certificate of insurance) insurance as follows: (a) All risk property insurance against loss and/or damage to Minimum Improvements under an insurance policy written in an amount not less than the full insurable replacement value of Project. The term "replacement value" shall mean the actual replacement cost of the Project (excluding foundation and excavation costs and costs of underground flues, pipes, drains and other uninsurable items) and equipment, and shall be reasonably determined from time to time at the request of City, but not more frequently than once every three (3) years. (3) Developer shall notify City immediately in the case of damage exceeding $100,000.00 in amount to, or destruction of, the Project or any portion thereof resulting from fire or other casualty. Net proceeds of any such insurance (Net Proceeds), shall be paid to Developer and City as their interests may appear, and Developer shall forthwith repair, reconstruct and 9 restore the Project to .substantially the same or an improved condition or value as they existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restoration, Developer shall apply the Net Proceeds of any insurance relating to such damage received by Developer to the payment or reimbursement of the costs thereof, subject, however, to the terms of any mortgage encumbering title to the Property (as its interests may appear 4.4 Preservation of Property. During the term of this Agreement, Developer shall maintain, preserve and keep, or cause others to maintain, preserve and keep, the Project in good repair and working order, ordinary wear and tear accepted, and from time to time shall make all necessary repairs, replacements, renewals and additions. Nothing in this Agreement, however, shall be deemed to alter any agreements between Developer or any other party including, without limitation, any agreements between the parties regarding the care and maintenance of the Property. 4.5 Non-Discrimination. In carrying out the project, Developer shall not discriminate against any employee or applicant for employment because of race, religion, color, sex, sexual orientation, national origin, age or disability. 4.6 Conflict of Interest. Developer agrees that no member, officer or employee of City, or its designees or agents, nor any consultant or member of the governing body of City, and no other public official of City who exercises or has exercised any functions or responsibilities with respect to the project during his or her tenure, or who is in a position to participate in adecision-making process or gain insider information with regard to the project, shall have any interest, direct or indirect, in any contract or subcontract, or the proceeds thereof, for work to be performed in connection with the project, or in any activity, or benefit therefrom, which is part of this project at any time during or after such person's tenure. In connection with this obligation, Developer shall have the right to rely upon the representations of any party with whom it does business and shall not be obligated to perform any further examination into such party's background. 4.7 Non-Transferability. This Agreement may not be assigned by Developer, nor may the Property be transferred by Developer to another party without the prior written consent of City, which shall not be unreasonably withheld 4.8 Restrictions on Use. Developer agrees for itself, and its successors and assigns, and every successor in interest to the Property or any part thereof that they, and their respective successors and assigns, shall: (1) Devote the Property to, and only to and in accordance with, the uses specified in the Request for Proposals and Developers proposal dated 10 (2) Not discriminate upon the basis of race, religion, color, sex, sexual orientation, national origin, age or disability in the sale, lease, rental, use or occupancy of the Property or any improvements erected or to be erected thereon, or any part thereof (however, Developer shall not have any liability to City to the extent that a successor in interest shall breach this covenant and City shall seek enforcement of this covenant directly against the party in breach of same). 4.9 Release and Indemnification Covenants. (1) Developer releases City and the governing body members, officers, agents, servants and employees thereof (hereinafter, for purposes of this Section, the Indemnified Parties) from, covenants and agrees that the Indemnified Parties shall not be liable for, and agrees to indemnify, defend and hold harmless the Indemnified Parties against, any loss or damage to property or any injury to or death of any person occurring at or about or resulting from any defect in the Project. (2) Except for any gross negligence, willful misrepresentation or any willful or wanton misconduct or any unlawful act of the Indemnified Parties, Developer agrees to protect and defend the Indemnified Parties, now or forever, and further agrees to hold the Indemnified Parties harmless, from any claim, demand, suit, action or other proceedings whatsoever by any person or entity whatsoever arising or purportedly arising from (1) any violation of any agreement or condition of this Agreement (except with respect to any suit, action, demand or other proceeding brought by Developer against City based on an alleged breach of any representation, warranty or covenant of City under this Agreement and/or to enforce its rights under this Agreement) or (2) the acquisition, construction, installation, ownership, and operation of the Minimum Improvements or (3) the condition of the Property and any hazardous substance or environmental contamination located in or on the Property, occurring after Developer takes possession of the Property. (3) The Indemnified Parties shall not be liable to Developer for any damage or injury to the persons or property of Developer or its officers, agents, servants or employees or any other person who may be on, in or about the Project due to any act of negligence of any person, other than any act of negligence on the part of any such Indemnified Party or its officers, agents, servants or employees. (4) All covenants, stipulations, promises, agreements and obligations of City contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of City, and not of any governing body 11 member, officer, agent, servant or employee of City in the individual capacity thereof. (5) The provisions of this Section shall survive the termination of this Agreement. 4.10 Compliance with Laws. Developer shall comply with all laws, rules and regulations relating to its businesses, other than laws, rules and regulations the failure to comply with or the sanctions and penalties resulting therefrom, would not have a material adverse effect on the business, property, operations, financial or otherwise, of Developer. 4.11 Condominium Formation. Developer agrees to establish the condominium and record the condominium covenants and other required documents, including the incorporation of the condominium association and qualifying it for tax exempt status, all prior to April 1, 2009 SECTION 5. EVENTS OF DEFAULT AND REMEDIES 5.1 Events of Default Defined. The following shall be Events of Default under this Agreement and the term Event of Default shall mean, whenever it is used in this Agreement, any one or more of the following events: (1) Failure by Developer to pay or cause to be paid, before delinquency, all real property taxes assessed with respect to the Property. (2) Failure by Developer to cause the construction of the Project to be commenced and completed pursuant to the terms, conditions and limitations of this Agreement. (3) Transfer of any interest by Developer of the Project in violation of the provisions of this Agreement prior to completion. (4) Failure by Developer or City to substantially observe or perform any other material covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement. 5.2. Remedies on Default by Developer. Whenever any Event of Default referred to in Section 5.1 of this Agreement occurs and is continuing, City, as specified below, may take any one or more of the following actions after the giving of written notice by City to Developer (and the holder of any mortgage encumbering any interest in the Property of which City has been notified of in writing) of the Event of Default, but only if the Event of Default has not been cured within sixty (60) days following such notice, or if the Event of Default cannot be cured within sixty (60) 12 days and Developer does not provide assurances to City that the Event of Default will be cured as soon as reasonably possible thereafter: (1) City may suspend its performance under this Agreement until it receives assurances from the defaulting party deemed adequate by City, that the defaulting party will cure its default and continue its performance under this Agreement; (2) Until the Closing Date, City may cancel and rescind this Agreement; (3) City shall be entitled to recover from Developer the sum of all amounts expended by City in connection with the funding of the Grant and loans to Developer, and City may take any action, including any legal action it deems necessary, to recover such amounts from the defaulting party; (4) City may take any action, including legal, equitable or administrative action, which may appear necessary or desirable to collect any payments due under this Agreement or to enforce performance and observance of any obligation, agreement, or covenant under this Agreement. 5.3 Re-Vesting Title in City Upon Happening of Event Subsequent to Conveyance to Developer. In the event that subsequent to conveyance of the Property to Developer by City and prior to receipt by Developer of the Certificate of Completion, an Event of Default under Section 5.1 of this Agreement occurs and is not cured within the times specified in Section 5.2, then City shall have the right to re-enter and take possession of the Property and any portion of the improvements thereon and to terminate and re-vest in City pursuant to the provisions of this Section 5.3 the estate conveyed by City to Developer, it being the intent of this provision, together with other provisions of this Agreement, that the conveyance of the Property to Developer shall be made upon the condition that (and the Deed shall contain a condition subsequent to the effect that), in the event of default under Section 5.1 on the part of Developer and failure on the part of Developer to cure such default within the period and in the manner stated herein, City may declare a termination in favor of City of the title and of all Developer's rights and interests in and to Property conveyed to Developer, and that such title and all rights and interests of Developer, and any assigns or successors in interests of Developer, and any assigns or successors in interest to and in Property, shall revert to City (subject to the provisions of Section 5.3 of this Agreement), but only if the events stated in Section 5.1 of this Agreement have not been cured within the time period provided above, or, if the events cannot be cured within such time periods, Developer does not provide assurance to City, reasonably satisfactory to City, that the events will be cured as soon as reasonably possible 5.4 Resale of Reacquired Property; Disposition of Proceeds. Upon the re- vesting in City of title to the Property as provided in Section 5.3 of this Agreement, 13 City shall, pursuant to its responsibility under law, use its best efforts, to resell the Property or part thereof as soon and in such manner as City shall find to a qualified and responsible party or parties (as determined by City in its sole discretion) who will assume the obligation of making or completing the Project or such other improvements in their stead as shall be satisfactory to City. 5.4 No Remed Exclusive. No remedy herein conferred upon or reserved to City is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. 5.5 No Implied Waiver. In the event any agreement contained in this Agreement should be breached by any party and thereafter waived by any other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. 5.6 Agreement to Pay Attorneys' Fees and Expenses. If any action at law or in equity, including an action for declaratory relief or arbitration, is brought to enforce or interpret the provisions of this Agreement, the prevailing party shall be entitled to recover reasonable attorneys' fees and costs of litigation from the other party. Such fees and costs of litigation may be set by the court in the trial of such action or by the arbitrator, as the case may be, or may be enforced in a separate action brought for that purpose. Such fees and costs of litigation shall be in addition to any other relief that may be awarded. 5.7 Remedies on Default by City. If City defaults in the performance of this Agreement, Developer may take any action, including legal, equitable or administrative action that may appear necessary or desirable to collect any payments due under this Agreement, to recover expenses of Developer, or to enforce performance and observance of any obligation, agreement, or covenant of City under this Agreement. Developer may suspend their performance under this Agreement until they receive assurances from City, deemed adequate by Developer, that City will cure its default and continue its performance under this Agreement. SECTION 6. GENERAL TERMS AND PROVISIONS 6.1 Notices and Demands. Whenever this Agreement requires or permits any notice or written request by one party to another, it shall be deemed to have been properly given if and when delivered in person or three (3) business days after 14 having been deposited in any U.S.'Postal Service and sent by registered or certified mail, postage prepaid, addressed as follows: If to Developer: Doug Horsfall, President Horsfall, Inc. 6167 Forest Hills Dr. Asbury, Iowa 52002 If to City: City Manager 50 W. 13th Street Dubuque, Iowa 52001 Phone: (563) 589-4110 Fax: (563) 589-4149 Or at such other address with respect to either party as that party may, from time to time designate in writing and forward to the other as provided in this Section. 6.2 Binding Effect. This Agreement shall be binding upon and shall inure to the benefit of City and Developer and their respective successors and assigns. 6.3 Termination Date. This Agreement and the rights and obligations of the parties hereunder shall terminate on 2018 (the Termination Date). 6.4. Execution By Facsimile. The parties agree that this Agreement may be transmitted between them by facsimile machine. The parties intend that the faxed signatures constitute original signatures and that a faxed Agreement containing the signatures (original or faxed) of all the parties is binding on the parties. 6.5 Memorandum of Development Agreement. Developer shall promptly record a Memorandum of Development Agreement in the form attached hereto as Exhibit D in the office of the Recorder of Dubuque County, Iowa. Developer shall pay the costs for so recording. IN WITNESS WHEREOF, City has caused this Agreement to be duly executed in its name and behalf by its Mayor and attested to by its City Clerk and Developer has caused this Agreement to be duly executed on or as of the first above written. CITY OF DUBUQUE, IOWA Roy D. Buol, Mayor By: By: 15 Jeanne Schneider, City Clerk HORSFALL, INC. By: Doug Horsfall, President INSURANCE SCHEDULE A INSURANCE REQUIREMENTS FOR TENANTS AND LESSEES OF CITY PROPERTY OR VENDORS (SUPPLIERS, SERVICE PROVIDERS) TO THE CITY OF DUBUQUE 1. All policies of insurance required hereunder shall be with an insurer authorized to do business in Iowa. All insurers shall have a rating of A or 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, except for 10 day notice for non-payment, if cancellation is prior to the expiration date. This endorsement supersedes the standard cancellation statement on the Certificate of Insurance. 3. Developer shall furnish a signed Certificate of Insurance to the City of Dubuque, Iowa for the coverage required in Paragraph 6 below. Such certificates shall include copies of the following policy endorsements: a) Commercial General Liability policy is primary and non-contributing. b) Commercial General Liability additional insured endorsement. c) Governmental Immunity Endorsements. 4. Each certificate shall be submitted to the contracting department of the City of Dubuque. 5. 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. Developer 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 a claims made form. Form CG 25 04 03 97 "Designated Location (s) General Aggregate Limit" shall be included. All deviations or exclusions from the standard ISO commercial general liability form CG 0001, or Business Owners form BP 0002, shall be clearly identified. 16 INSURANCE SCHEDULE A (Continued) INSURANCE REQUIREMENTS FOR TENANTS AND LESSEES OF CITY PROPERTY OR VENDORS (SUPPLIERS, SERVICE PROVIDERS) TO THE CITY OF DUBUQUE Governmental Immunity Endorsement identical or equivalent to form attached. Additional Insured Requirement: 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 shall be named as an additional insured on General Liability Policies using ISO endorsement CG 20 26 0704 "Additional Insured -Designated Person or Organization," or it's equivalent. -See Specimen b) WORKERS' COMPENSATION 8~ EMPLOYERS LIABILITY Statutory for Coverage A Employers Liability: Each Accident Each Employee -Disease Policy Limit -Disease c) UMBRELLA EXCESS LIABILITY LIQUOR OR DRAM SHOP LIABILITY Coverage to be determined on a case by case basis by Finance Director. Completion Checklist ^ Certificate of Liability Insurance (2 pages) ^ Designated Location(s) General Aggregate Limit CG 25 04 03 97 (2 pages) ^ Additional Insured 20 26 07 04 ^ Governmental Immunities Endorsement $100,000 $100,000 $500,000 17 CITY OF DUBUQUE, IOWA GOVERNMENTAL IMMUNITIES ENDORSEMENT Nonwaiver of Governmental Immunity. The insurance carrier 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. 2. Claims Coverage. 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. 3. 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. 4. Non-Denial of Coverage. 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 Change in Policy. The above preservation of governmental immunities shall not otherwise change or alter the coverage available under the policy. SPECIMEN 18 P~L#CY NUMI3F'R GQMf116RCifU,. {aENERAI_ IJABILITY Cl3 28 46 47 (14 TH3S ENDQR.SEMENT CHANGES THE Pfl1.ICY, PLEASE READ IT CAREFULLY. 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L{SEr„4E i+:'JG L.+AI ~ S ~~ i ____ Ixilcxrrr urenn~emea u>L:nuux6rvclrtCUdi~T~~J51671a ~caea ev emrnrnserexrrsravu rer:YrtbKm3 CITY Qf OUBU01iE I5 LISTfO AS AY Al1diTIOINAL INSURED ON GENERAL LIABILITY P'lll IG'ltS uSIINt ISL] EiJD~tSE- FORR CG i0 Zfi 07 04 "ADffiTTONN. 1NSUkEO-DESIC~fATEd PERSflN OR ORGAYIZA~TIgI+" f1R Ii`S EQKIIVIiANi. RAL LIABILITY POLICY I5 PRIMARY AMd NON-~ONTRIBUTIhG. FUNM CG Z5 fl4 C!3 97 "CIESICMATED LOCIIII4Y~" RAL LIABILITY AG~,REGATE LINZT SHALL BE INCLUDED. GD4ERl+FIENTAI. TMMLINI T iE_5 Et~x]itSE-IENT IS INCLUDED. POLIICIES SHALL UE EKIORSFn rlr F'I[iY,+iD£ 30 DAY ADVANCE NOTICE Of CANCEl.LA7`IUN TO CITY OF DUBUQUE 'E 9NfJ4.LD 1t1Y4F TNEA@3f4lE l3ESCq@ED PfR)GIfS R" exycn.4ro m uue me EXPIRATIOlJ BATE THERT?DF, THE 1861:IN& NSUR3t iMl.1. ~11`~i~l'~I Y.W. QTY 9F OUBUWE .:;~' hJtYE YiFrtTEN 7101rF>=tiff T+E CEa-ICraaTr tln rJrre xarrraro rw_~crr, QTY MALL I~IWmli7~l1>~16[IiMS1tlYi1L}t%iX1t 30 W. 13TH STR[ET _ WIlUf2Ut, lA 2UDI xmnr~eceerncer+ranre asa~c+ zs E~na~aoaT d?ACORU ODRPORATIO#I 1986 20 IMRORTANT I~ ihC cXYtif~G.7te hAl4~e Igo an RaU-1 it»~L 13V8t~ftEC~. 7kra truli~:yfi~s~ n>n~ ~ ee,~9u~seit. A staiarnenE Ufr Ills S:wfL~TiC7l6 ¢fi~5 npl COfR27 I1~h75 !0 the G431"11fIGaLC ItrflriGr in lirri i~f ~an~i r.+uktY:teriier~l~s}. N SUBR4GATIS3M I~ ti':ANED, ~bfect w ttr~a 6~rria arr~i cvrrdiki~rr~ ~f Ili k~c,lia,T, ~i~Iair~ pdicles may require ;~i ~rX1rr~nt. ~ staten-ecet on this cdrtilM:z~n +kirY ru;1 i;tei[r.~ ~iylds Ic Itrr. txililitixla hdddt in Ii@tb of gtMt endr~rsemFni{s). DffiCLA1MIER the Ce~.itu_atr Uf ifls~uance fln the rpy+erse aide got ttr s fxm dues real tz~rskiluir: a c.ord+r~# ls-l•.~K~~ the wsui-rg insutr3tist, augrCxLCd r8preserrt~ive or prodrxxr, and tFie cr~rlificaus liv~lr; ,real ,h.+~ it atlrrrratrvely rar ncrgd.iwr~iy art!; Extend or a6fer Itte co~rerage af(ordett txir 4ia pulir:irg lisir. f (lea:~ru~i SPECIMEN ACgRf7 2b I2~J@1A~M 21 ~~rucv yu+nQEra: G{?MMERdrIAL GENERAL LIA,BILJTY CCi 25 i'!4 U3 8T THIS ENi~t7RSEM~NT CHANGES 7H~ POLICY. PLEASE READ R 1rAREFUI_LY, DESIGNATECi LQCATIQhI{} GENERAL AGGREG~4-TE LIMIT This e~nrlursar-iant madifl~r ir~srrr:3nr.P pmvirtr,A utx~cx une fcNaung: COMh1ERCIAI GENERAL LI.4RIt IT`Y CC~VE~E PftiF.T SGHEDUtg Oeslgrtat~d Lotati~rr{a}: _ ..._t I If no C~`;hr, 8ppeara atvrve. it#ormaticn n:s7ulrecl CO complete this enrdnrsement wit ha. r~hrn++ri in t#xe Eleclsra#ions gas aaptcah9e to the en~cars~en~rk. } A Ftar all sums r~hich the ir~u-ed 6er~7r:.y I~yblhr ~bligaic.c! Ira FAY as damages quaed tsy "nccurrerces' ~uxleu t"dt7L'FRAG>~ A tSEGTIGN tl. anal fio• all rrectirsl exFen3es mused b~ ac:c- denls under C~V~#tACiE C iSEirTI OM I), whin can br< .attribu6ed only to o{:eralians at a sirog`e eiees~rvuttd "I®calion" sdiown in the Sc~:edu~ts 1. A sate De3&ig'ta~d Lcu;atiern General f~gre~a$e Limit ap~l+es to each designated '1oC2tiall', and lh9t imit ~ ~l`P) t4 me Neritrurd cal the G~ntsral A~gragate Lim t aharrn in the OeGlarat)or~s 2 Thr C~signsir=d Lacatitur C~rr2ra= /~g~$g~11B t ir~al iy Urrr nrusl ~uc will pay for ttm sum of ell davnagea under CC}'~CR+~GC 14, oxce~ d~rrr ages because of "bodily inj4r~' Ot "ptcrpurt} d2rnage' inolarJed in the'praducts-completed operations harart+T, arxi fiver rnr?dical exFersea under G(3VER4GE G reSlardless ofi Gte r~um- t;et af: a, !nsu~~s. b, Claims mede gr"~uil~' beast°I, ur c, taersonw cx argartaa-iona making claims tx• t)ri~r~telg ''suits". a. any Ray~er•Rs made w.lnd~r CtTJEft~4GE A br damage ar unrJpr t=t7+~FR4GE G iar mpyir~l ex~e'ises sh2rll reduce tt-e Uesrg- nated Locetlon G~~ael A+aLsrergate Lirnil fpr iha: deaignsrGad `location". ::~a~Ch pavmcn+s SA1"ell ntst f6dute the Genersi fgcrr:gafia tnnit ahr•.wn in tlsP f7wr:taralir~ns nrr mall thE+y re- duce any other faesipnatsd Lcx:a°ian General I~ggregata Limit fdr airy 7~er desi7nated 'lcoceriari Shrs~rn in Ihs Stheclale aboue. +~. The 4imitra str~,vn in+the C~eeJal~aans {or Fuach Qc~urr€v~ Fire C~rsnrag~ rand Medo~,zrl Lx- perse continue to apply- it~aav2r, Instead of heiryg subje>xt to the C3ensral figgr€~gate Limit Shth~vf in ttxg L7rr:6aratign5~, SIfiCM i1rYrRS Wtl b9 buble~Y t~ thn uplrl'x:atsfa i7esigns~ieti t ncasl~n Ganerel,f5~~regrie I ienil 22 ~.t=ca III auetis wtiicl~ #h~ in~,rrs:cl I~ea~nes IegaNy obligated hr pay 85 damages caused by `trrree:urrenc2e" under CQVERAGE A ?SEC:71[lPt I), and let all medical expyrw.[*5 r'ai~arxl by ars:i~ d;rrt#s vn~ier Ct1'JERkC,E C tSEGTIaN It. whCh cannot be xtfritaul~ri anly to cfperatioz~6 at a sln- qle desi3nated 9acatittt` shonvn in the ~ftedu~ atnva. 1. ,A4+ty ~tyrrerri9 mrida under Ct]r+JERAGE A for damages or .in4er GOV~RAGE C =ar ittecii~' expenses ~haU reduo~E the ar»t~zrnt ax~allsble under tits GFli~ti31 PtBgrb~ete Llmlt ar the Prarlus s-Gcx•I~I~ls~l ir7p~ratrC~: A9- gregake Limit w~ltiie~teuwr is appti :a3tla; end Z ~t.efi peymerts shalt not r~iur.,r~ arty Deslgnat,~ L.nrarion Cxxtaral Agyrayate Litriil. C_ Whcn ~zaverz+ge lur {inailily ~9rc3iix~ tsui rf the '/7tQdUC'IM Completed optir~lione herd' ie Pro` vieed, any payments for damages 15ecfiu58 tsf 'hodi~y injury` ar "prcpcxty dama~le" nclu~d in the `~radvets-canpleGe~C Qaerauans hazard" will reduce the Pr4ducJs-Gomple4r3d ~pgratinr>` ~i- gregafe Limi[ aria not rt3duoe the General >~. gt+dgate u1ni1 nor me Liesa~natad Lrxatt7n C"~e+n- era Aggregate Limit. t}. For tho pvlrposes of This endor~tnent. dte Uefi- nttlons ~ecT~r~n is atr-~xt~ hY the addifion of the following definfi,ner: 'Lvaalion" means premises ~rvoly ng tF,e same or c~nnec~ng Tats, or pr~ntiaes w-~se crrnr~c- tion IS Irrte-rusted Gnl'/ by a 5raet radchray. wa_ #envayr or regf•t~cf-way of a railroad. E. I he prOMl91rJn3 a< I units f7f I nsuran~ (~EC'I'IOPJ tlt'I rr~t ptt-errrise modified 6y ihias end~rrsrxnczat Shall ~~~nu~e tc apply as ~lipula6ed. 23 EXHIBIT B LEGAL DESCRIPTION The South Middle 1/5 of Out Lot 480 in the City of Dubuque, Iowa, according the United States Commissioners Map thereof. 24 Prepared by: James A. OBrien 300 Main Street ,Suite 330, Dubuque IA 52001 563 583-4113 Return to: James A OBrien 300 Main Street ,Suite 330, Dubuque IA 52001 563 583-4113 Tax Statement to: SPECIAL WARRANTY DEED KNOW ALL MEN BY THESE PRESENTS: that the City of Dubuque, Iowa, a municipal corporation of the State of Iowa (Grantor), in consideration of the Grantee named below undertaking the obligations of the Developer under the Development Agreement described below and the sum of and no/100 Dollars ($ ) in hand paid, and other good and valuable consideration, and pursuant to the authority of Chapter 403, Code of Iowa, does hereby GRANT, SELL AND CONVEY unto (Grantee), the following described parcel(s) situated in the County of Dubuque, State of Iowa, to wit (the Property): This Deed is exempt from transfer tax pursuant to Iowa Code section 428A.2(6). This Deed is given pursuant to the authority of Resolution No. of the City Council of the City of Dubuque adopted the day of , 20_, the terms and conditions thereof, if any, having been fulfilled. This Deed is being delivered in fulfillment of Grantor's obligations under and is subject to all the terms, provisions, covenants, conditions and restrictions contained in that certain Development Agreement executed by Grantor and Grantee herein, dated the day of 20_ (the Agreement), a memorandum of which was recorded on the day of , 20_, in the records of the Recorder of Dubuque County, Iowa, Instrument Number Promptly after completion of the improvements in accordance with the 26 provisions of the Agreement, Grantor will furnish Grantee with a Certificate of Completion in the form set forth in the Agreement. Such certification by Grantor shall be, and the certification itself shall so state, a conclusive determination of satisfaction and termination of the agreements and covenants of the Agreement and of this Deed with respect to the obligation of Grantee, and its successors and assigns, to construct improvements and the dates for the beginning and completion thereof, it being the intention of the parties that upon the granting and filing of the Certificate of Completion that all restrictions, re-vesting of title and reservations of title contained in this Deed be forever released and terminated and that any remaining obligations of Grantee pursuant to the Agreement shall be personal only. All certifications provided for herein shall be in such form as will enable them to be recorded with the County Recorder of Dubuque, Iowa. If Grantor shall refuse or fail to provide any such certification in accordance with the provisions of the Agreement and this Deed, Grantor shall, within twenty days after written request by Grantee, provide Grantee with a written statement indicating in adequate detail in what respects Grantee has failed to complete the improvements in accordance with the provisions of the Agreement or is otherwise in default, and what measures or acts will be necessary, in the opinion of Grantor, for Grantee to take or perform in order to obtain such certification. In the event that an Event of Default occurs under the Agreement and Grantee herein shall fail to cure such default within the period and in the manner stated in the Agreement, then Grantor shall have the right to re-enter and take possession of the Property and to terminate and revest in Grantor the estate conveyed by this Deed to Grantee, its assigns and successors in interest, in accordance with the terms of the Agreement. None of the provisions of the Agreement shall be deemed merged in, affected or impaired by this Deed. Grantor hereby covenants to warrant and defend the said premises against the lawful claims of all persons whomsoever claiming by, through and under it. Dated this of , 20_ at Dubuque, Iowa. CITY OF DUBUQUE IOWA Attest: By: Roy D. Buol, Mayor By: Jeanne F. Schneider, City Clerk 27 STATE OF IOWA COUNTY OF DUBUQUE SS On this day of , 20_, before me a Notary Public in and for said County, personally appeared Roy D. Buol and Jeanne F. Schneider to me personally known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively of the City of Dubuque, Iowa, a Municipal Corporation, created and existing under the laws of the State of Iowa, and that the seal affixed to the foregoing instrument is the seal of said Municipal Corporation, and that said instrument was signed and sealed on behalf of said Municipal Corporation by authority and resolution of its City Council and said Mayor and City Clerk acknowledged said instrument to be the free act and deed of said Municipal Corporation by it voluntarily executed. Notary Public in and for Dubuque County, Iowa 28 EXHIBIT D MEMORANDUM OF DEVELOPMENT AGREEMENT 29 Prepared by: James A. OBrien 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 Return to: James A OBrien 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 MEMORANDUM OF DEVELOPMENT AGREEMENT A Development Agreement by and among the City of Dubuque, Iowa, an Iowa municipal corporation, of Dubuque, Iowa, and was made regarding the following described premises: The Development Agreement is dated for reference purposes the day of 20_, and contains covenants, conditions, and restrictions concerning the sale and use of said premises. This Memorandum of Development Agreement is recorded for the purpose of constructive notice. In the event of any conflict between the provisions of this Memorandum and the Development Agreement itself, executed by the parties, the terms and provisions of the Development Agreement shall prevail. A complete counterpart of the Development Agreement, together with any amendments thereto, is in the possession of the City of Dubuque and may be examined at its offices as above provided. Dated this day of , 20_. CITY OF DUBUQUE, IOWA By: Roy D. Buol, Mayor By: Jeanne F. Schneider, City Clerk 30 a STATE OF IOWA DUBUQUE COUNTY ss: On this day of , 20_, before me, a Notary Public in and for the State of Iowa, in and for said county, personally appeared Roy D. Buol and Jeanne F. Schneider, to me personally known, who being by me duly sworn did say that they are the Mayor and City Clerk, respectively of the City of Dubuque, a Municipal Corporation, created and existing under the laws of the State of Iowa, and that the seal affixed to said instrument is the seal of said Municipal Corporation and that said instrument was signed and sealed on behalf of said Municipal corporation by authority and resolution of its City Council and said Mayor and City Clerk acknowledged said instrument to be the free act and deed of said Municipal Corporation by it voluntarily executed. Notary Public, State of Iowa STATE OF IOWA DUBUQUE COUNTY ss: On this day of , 20_, before me, a Notary Public in and for the State of Iowa, in and for said county, personally appeared to me personally known, who being by me duly sworn did say that they are the and that said instrument was signed on behalf of said company by authority of its members and that they acknowledged the execution of this instrument to be the voluntary act and deed of said company by it voluntarily executed. Notary Public, State of Iowa 31