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IBM Development Agreement_DRAFT 1 26 09DEVELOPMENT AGREEIViENT EETWEEN THE CITY OI° DUEUQU, IO1n/A , , R AND ' DUBUQUE INITIATIVES This Agreement, dated for reference purposes the day of 2009 (Effective Date), by and between the City of Dubuque, Iowa, a municipality (City), established pursuant to the Iowa Code and acting under authorization of Iowa Code Chapter 403, as amended (the Urban Renewal Act), and Dubuque Initiatives, an Iowa not-for-profit corporation (Developer). WITNESSETH: WHEREAS, Developer is the owner of the property at 700 Locust Street (the Property), legally described as follows: A parcel of land marked "Public Square" on the United States Commissioners' Plat of the Survey of the Town of Dubuque, Iowa and numbered as Lots 141, 142, and 143a, on the various wall maps of the City of Dubuque, Iowa; and, City Lots 143, 144 and 145, in the City of Dubuque, Iowa, according to the plat thereof in Book of Plats 34, page 353, records of Dubuque County, Iowa, also described as follows: Part of the United States Commissioners' Government Plat of the Original Town, now City, of Dubuque, in Dubuque County, Iowa, described as follows: Beginning at the southwesterly corner of Lot 141, originally designated as the southwesterly corner of the "Public Square", being also the intersection of the east line of Locust Street and the north line of West Seventh Street; thence North 22 degrees 30 minutes West along the east line of Locust Street to the northwesterly corner of Lot 145, being also the intersection of the east line of Locust Street and the southerly line of West Eighth Street; thence northeasterly along the northerly line of Lot 145 to the northeasterly corner of Lot 145, being also the intersection of the south line of West Eighth Street and the west line of the thirty foot alley East of Locust Street; thence southeasterly along the west line of said thirty foot alley to the southeasterly corner of Lot 141, originally designated as the southeasterly corner of the "Public Square", being also the intersection of the west line of the thirty foot alley and the north line of West Seventh Street; thence South 67 degrees 30 minutes West to the point of beginning, according to the Plat thereof recorded as Instrument No. 1798-77, records of Dubuque County, Iowa. WHEREAS, the Property is located in the Greater Downtown Urban Renewal District which has been so designated by City Council Resolution No. 300-08 as a slum and blight area (the Project Area) defined by Iowa Code Chapter 403 (the 011509ba1rev1012309 Urban Renewal Law); and WHEREAS, Developer has undertaken the redevelopment of a building located on the Property (the Building) and will be operating the Building during the term of this agreement; and WHEREAS, Developer has agreed to lease offices in the Property to International Business Machines Corporation (Employer) to allow Employer to locate its offices to the Property and create employment opportunities at the Property; and WHEREAS, Developer and Employer have committed an additional capital investment in Building improvements, equipment, furniture and fixtures in the Property in the estimated amount of Thirty-Nine Million Dollars ($ 39,000,000.00) (the Project); and WHEREAS, pursuant to Iowa Code Section 403.6(1), and in conformance with the Urban Renewal Plan for the Project Area adopted on May 18, 1967, as amended, City has the authority to enter into contracts and agreements to implement the Urban Renewal Plan for the District; and WHEREAS, the City Council of City believes it is in the best interests of the City to encourage Developer in the development of the Property by providing certain incentives as set forth herein; and WHEREAS, City and Employer have entered into a separate Incentive Agreement Between the City of Dubuque, Iowa and International Business Machines Corporation (the Employer Agreement), a copy of which is attached hereto as Exhibit B; 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 as follows: SECTION 1. REPRESENTATIONS AND WARRANTIES. 1.1. Representations and Warranties of City. In order to induce Developer to enter into this Agreement, City hereby represents and warrants to Developer that to the best of City's knowledge: 011509ba1rev1012309 2 (1) 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. This Agreement, upon execution and delivery by the City (assuming due authorization, execution and delivery by Developer), is a valid and legally binding instrument of City, enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization or other laws relating to or affecting creditors' rights generally. (2) City shall exercise its best efforts to cooperate with Developer in the development process. (3) City shall exercise its best efforts to resolve any disputes arising during the development process in a reasonable and prompt fashion. (4) The execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, and the fulfillment of or compliance with the terms and conditions of this Agreement are not prevented by, limited by, in conflict with, or result in a violation or breach of, the terms, conditions or provisions of the charter of City, any evidence of indebtedness, agreement or instrument of whatever nature to which City is now a party or by which it or its property is bound, or constitute a default under any of the foregoing. (5) There are no actions, suits or proceedings pending or threatened against or affecting City in any court or before any arbitrator or before or by any governmental body in which there is a reasonable possibility of an adverse decision which could materially adversely affect the financial position or operations of City or which affects the validity of the Agreement or City's ability to perform its obligations under this Agreement. 1.2. Representations and Warranties of Developer. Developer makes the following representations and warranties: (1) Developer is an Iowa not-for-profit corporation organized and validly existing under the laws of the State of Iowa, and has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as presently proposed to be conducted, and to enter into and perform its obligations under the Agreement. (2) This Agreement has been duly authorized, executed and delivered by Developer and, assuming due authorization, execution and delivery by City , is in full force and effect and is a valid and legally binding instrument of Developer enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization or other laws relating to or affecting creditors' rights generally. Developer's counsel shall issue a legal opinion to the City, at time of closing, confirming the representations 3 contained herein, in the form attached hereto as Exhibit A. (3) The execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, and the fulfillment of or compliance with the terms and conditions of this Agreement are not prevented by, limited by, in conflict with, or result in a violation or breach of, the terms, conditions or provisions of the articles of incorporation or by-laws of Developer or any contractual restriction, evidence of indebtedness, agreement or instrument of whatever nature to which Developer is now a party or by which it or its property is bound, or constitute a default under any of the foregoing. (4) There are no actions, suits or proceedings pending or threatened against or affecting Developer in any court or before any arbitrator or before or by any governmental body in which there is a reasonable possibility of an adverse decision which could materially adversely affect the business, financial position or result of operations of Developer or which affects the validity of the Agreement or Developer's ability to perform its obligations under this Agreement. (5) Developer will perform its obligations under this Agreement in accordance with the terms of this Agreement, the Urban Renewal Plan and all local, State and federal laws and regulations. (6) Developer will use its best efforts to obtain, or cause to be obtained, in a timely manner, all material requirements of all applicable local, state, and federal laws and regulations which must be obtained or met. (7) Developer has firm commitments for permanent financing for the Project in an amount sufficient, together with equity commitments, to successfully complete the requirements of this Agreement and shall provide evidence thereof to City prior to the Closing Date. 1.3. Closin The closing shall take place on February 19, 2009, or such other date as the parties shall mutually agree upon in writing (the Closing Date) but which in no event shall be later than the 1St day of June, 2009. 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. 1.4. Conditions to Closing. The closing of the transaction contemplated by this Agreement and all the obligations of the parties under this Agreement are subject to fulfillment, on or before the Closing Date, of the following conditions: (1) City and Developer shall be in material compliance with all the terms and provisions of this Agreement. 4 (2) Developer shall have furnished City with evidence, in a form satisfactory to City (such as a letter of commitment from a bank or other lending institution), that Developer has firm financial commitments in an amount sufficient, together with equity commitments, to complete the Minimum Improvements (as defined herein) in conformance with the Construction Plans (as defined herein), or City shall have received such other evidence of such party's financial ability as in the reasonable judgment of City is required. (3) Developer's counsel shall issue a legal opinion to the City confirming the representations contained herein, in the form of Exhibit A, attached hereto. (4) Developer shall provide City with written notice of an executed lease between Developer and Employer with respect to the Property and the Minimum Improvements located thereon (the Lease) as hereinafter described with a term of not less than ten (10) years and commencing not later than the 1St day of July, 2009. (5) City and one or more lenders shall have entered into a guaranty in the form attached hereto as Exhibit D as required by Section 3.3. (6) City and Employer shall have entered into an Incentive Agreement on terms acceptable to City in City's sole discretion; (7) Developer shall have the right to terminate this Agreement at any time prior to the consummation of the closing on the Closing Date if Developer determines in its sole discretion that conditions necessary for the successful completion of the Project contemplated herein have not been satisfied to the full satisfaction of such party in such party's sole and unfettered discretion. Upon the giving of notice of termination by such terminating party to the other parties to this Agreement, this Agreement shall be deemed null and void. 1.5. City's Obligations at Closing. At or prior to the Closing Date, City shall deliver to Developer such other documents as may be required by this Agreement, all in a form satisfactory to Developer. 1.6. Post-Closing Condition. This Agreement is subject to the Iowa Department of Economic Development approving by not later than February 19, 2009 for financial assistance to Employer upon such terms and in such amounts as Employer in its sole discretion deems acceptable. SECTION 2. DEVELOPMENT ACTIVITIES. 2.1. Required Minimum Improvements. Developer agrees to rehabilitate, construct and improve approximately 255,000 square feet of office/retail space on the Property at an estimated cost of Thirty-Nine Million Dollars ($39,000,000.00) as follows: approximately 130,000 square feet to accommodate Employer's requirements (the Employer Minimum Improvements) and the balance for Developer's requirements (the Developer Minimum Improvements)(referred to collectively as the Minimum Improvements). 2.2. Plans for Construction of Minimum Improvements. Plans and specifications with respect to the development of the Property and the construction of the Minimum Improvements thereon (the Construction Plans) shall be in conformity with the Urban Renewal Plan, this Agreement, and all applicable state and local laws and regulations, including but not limited to any covenants, conditions, restrictions, reservations, easements, liens and charges, applicable to the Property, all recorded with the Dubuque County Recorder's office. 2.3. Timing of Improvements. Developer hereby agrees that construction of the Minimum Improvements on the Property shall be substantially completed in the following phases: Phase I: Floors 8 and 9 July 1, 2009 Phase II: Floor 7 September 1, 2009 Phase III: Floors 5 and 6 November 1, 2009 For purposes of this section, "substantial completion" shall not include fixtures and equipment, and does not contemplate receipt of a certificate of occupancy. 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 Minimum Improvements, 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 delays. The time for performance of such obligations shall be extended only for the period of such delay. 2.4. Certificate of Completion. Promptly following the request of Developer upon completion of the Minimum Improvements, City shall furnish Developer with an appropriate instrument so certifying. Such certification (the Certificate of Completion) shall be in recordable form and shall be a conclusive determination of the satisfaction and termination of the agreements and covenants in this Agreement with respect to the obligations of Developer to construct the Minimum Improvements. SECTION 3. CITY PARTICIPATION. 3.1. Economic Development Grant to Developer. 6 (1) For and in consideration of Developer's obligations hereunder, and in furtherance of the goals and objectives of the Urban Renewal Plan for the Project Area and the Urban Renewal Law, City agrees, subject to Developer being in compliance with the terms of this Agreement, to make forty (40) consecutive semi-annual payments (such payments being referred to collectively as the Developer Economic Development Grants) to Developer on the applicable payment dates later described in this Section; provided, however, that the Developer Economic Development Grants shall terminate upon payment of the balance of the Minimum Improvement Loan described in Section 3.3, including any extensions or modifications thereof. The Developer Economic Development Grants shall be payable as follows: November 1, 2009 May 1, 2010 November 1, 2010 May 1, 2011 November 1, 2011 May 1, 2012 November 1, 2012 May 1, 2013 November 1, 2013 May 1, 2014 November 1, 2014 May 1, 2015 November 1, 2015 May 1, 2016 November 1, 2016 May 1, 2017 November 1, 2017 May 1, 2018 November 1, 2018 May 1, 2019 November 1, 2019 May 1, 2020 November 1, 2020 May 1, 2021 November 1, 2021 May 1, 2022 November 1, 2022 May 1, 2023 November 1, 2023 May 1, 2024 November 1, 2024 May 1, 2025 November 1, 2025 May 1, 2026 November 1, 2026 May 1, 2027 November 1, 2027 May 1, 2028 November 1, 2028 May 1, 2029 pursuant to Iowa Code Section 403.9 of the Urban Renewal Law, in amounts equal to the portion of the tax increment revenues collected by City described below under Iowa Code Section 403.19 (without regard to any averaging that may otherwise be utilized under Iowa Code Section 403.19 and excluding any interest that may accrue thereon prior to payment to Developer) during the preceding six-month period in respect of the Developer Minimum Improvements constructed by Developer (the Developer Tax Increments). For purposes of calculating the amount of the Developer Economic Development Grants provided in this Section, the Developer Tax Increments shall be deemed to be equal in amount to a pro rata share of those tax increment revenues collected by the City in respect of the increase in the assessed value of the Property other than any part of the Property leased by Employer above the assessment of January 1, 1967 (On such date the entire Property was assessed for $567,000.00). The Developer Tax Increments 7 shall not include (i) any property taxes collected for the payment of bonds and interest of each taxing district, (ii) any taxes collected for the regular and voter- approved physical plant and equipment levy, and (iii) any other portion required to be excluded by Iowa law, and thus such incremental taxes will not include all amounts paid by Developer as regular property taxes. The assessed value of the Property leased by Employer and the assessed value of the Property other than the part of the Property leased by Employer on any assessment date shall be allocated according to the percent that the part of the Property leased by Employer bears to the total leasable space. (2) To fund the Developer Economic Development Grants, City shall certify to the County prior to December 1 of each year, commencing December 1, 2009, its request for the available Developer Tax Increments resulting from the assessments imposed by the County as of January 1 of that year, to be collected by City as taxes are paid during the following fiscal year and which shall thereafter be disbursed to Developer. (Example: if City so certifies by December 1, 2009, the Developer Economic Development Grants in respect thereof would be paid to Developer on November 1, 2010, and May 1, 2011.) (3) The Developer Economic Development Grants shall be payable from and secured solely by the Developer Tax Increments paid to City that, upon receipt, shall be deposited and held in a special account created for such purpose and designated as the "Roshek Building Dubuque Initiatives TIF Account" of City. City hereby covenants and agrees to maintain its TIF ordinance in force during the term and to apply the incremental taxes collected in respect of the Property and Minimum Improvements and allocated to the Roshek Building Dubuque Initiatives TIF Account to pay the Developer Economic Development Grants, as and to the extent set forth in this Section 3.2. The Developer Economic Development Grants shall not be payable in any manner by other tax increments revenues or by general taxation or from any other City funds. City makes no representation with respect to the amounts that may be paid to Developer as the Developer Economic Development Grants in any one year and under no circumstances shall City in any manner be liable to Developer so long as City timely applies the Developer Tax Increments actually collected to the Roshek Building Dubuque Initiatives TIF Account (regardless of the amounts thereof) for the payment of the Developer Economic Development Grants to Developer as and to the extent described in this Section. (4) City shall be free to use any and all tax increment revenues collected in respect of other properties within the Project Area, including the Property, or any available Developer Tax Increments resulting from the termination of the annual Developer Economic Development Grants under this Section 3.2, for any purpose for which such tax increment revenues may lawfully be used 8 pursuant to the provisions of the Urban Renewal Law, and City shall have no obligations to Developer with respect to the use thereof. 3.2. Rehabilitation Grants. City hereby commits to provide, as described below, the following grants to Developer: a $10,000 design grant (the Design Grant); a $10,000 fagade grant (the Facade Grant); and a $15,000 financial consultant grant (the Financial Consultant Grant). To qualify for such assistance, the Project shall to be completed in accordance with plans approved by City . (1) The Design Grant not to exceed ten thousand dollars ($10,000) will be available to Developer to offset documented predevelopment costs, architectural and engineering fees and other miscellaneous soft costs. (2) The Fagade Grant not to exceed $10,000 will be available to Developer to off-set documented improvements to the exterior of the building. (3) The Financial Consultant Grant not to exceed $15,000 will be available to Developer to hire a financial consultant to analyze the feasibility of the Project. 3.3. Loan Guarantee. (1) City shall guarantee, in the form attached hereto as Exhibit D (the Guaranty), and with such security as City determines to be appropriate, a loan on behalf of Developer in an amount not to exceed $25,000,000 for financing of the Minimum Improvements (the Minimum Improvements Loan) amortized over twenty (20) years at five and 85/100 percent (5.85%) per annum with monthly payments of interest only and with the entire unpaid balance due at the end of the twenty-year term. In consideration for the Guaranty, Developer agrees that any grants and tax credits received by Developer or which accrue to the benefit of Developer or the Property shall be applied to the balance of the principal of the Minimum Improvements Loan or to pre-Minimum Improvements Loan development costs. (2) With respect to the Minimum Improvements Loan, Developer shall (a) Use its best efforts to pursue grants to retire the Minimum Improvements Loan, including, but not limited to, state and federal historic tax credits, New Market Tax Credits, and Iowa Department of Economic Development funding; (b) Apply all Developer's fees and all lease revenue from the Building, less required payments for insurance, taxes, operations, pre- Minimum Improvements Loan development costs, and maintenance, to retiring the Minimum Improvements Loan; 9 (c) Apply all Developer Economic Grants received by Developer under Section 3.2 for leased space in the Building to retiring the Minimum Improvements Loan; and (d) Dedicate an initial amount of not less than Two Million Dollars ($2,000,000.00) to pay the principle of and interest on the Minimum Improvement Loan until the Minimum Improvement Loan is paid in full. (3) In the event City pays the then balance of the Minimum Improvements Loan through the issuance of general obligation bonds, then all obligations that Developer has with respect to the Minimum Improvements Loan shall become obligations owed to City. (4) Dubuque Initiative shall have no other obligation for the financing of the Minimum Improvements except as set forth in Section 2.1 and this Section 3.3. 3.4. Application for Grants and Tax Credits. Developer and City agree to cooperate with each other in applying for grants and tax credits to fund the Minimum Improvements and to retire the Minimum Improvements Loan, including, but not limited to, state and federal historic tax credits, New Market Tax Credits, and Iowa Department of Economic Development funding. SECTION 4. COVENANTS OF ®EVELOPR. 4.3 IBM Fund for Sustainable Dubuque. Developer shall enter into a Donor Advised Permanent Endowment Fund Agreement to fund "The IBM Fund for Sustainable Dubuque" ("the Fund") at the Community Foundation of Greater Dubuque in the amount of ten per cent (10%) of the net benefits to Developer of the New Market Tax Credits for the Minimum Improvements, in substantially the form attached hereto as Exhibit E. The Fund shall be an endowed fund, and the terms of the Fund and its future administration are intended to comply with the terms and conditions of Iowa Code § 15E.301 et seq. including, but not limited to, the provision that the Fund be a permanent endowment, as defined therein, and that the Fund benefit Iowa charities or Iowa charitable causes, and that it be established in a qualifying Community Foundation as defined therein. The annual distributions from the Fund shall be to support sustainability initiatives in targeted neighborhoods in the City of Dubuque, such initiatives to be determined by a committee selected by Employer and subject to the agreement to the Agreement between Developer and the Community Foundation of Greater Dubuque in the substantially the form attached hereto as Exhibit E. "sustainability initiatives" are those initiatives that ensure that Dubuque is a viable, livable, and equitable community embracing economic prosperity, social/cultural vibrancy and environmental integrity to create a 10 sustainable legacy for generations to come. 4.1. Books and Records. During the term of this Agreement, Developer shall keep at all times and make available to City upon reasonable request 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 related to the Project 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 the Property unless the obligation to do so has been assumed by another person or entity pursuant to the provisions of this Agreement. 4.3. Insurance Reauirements. (1) Developer shall provide and maintain or cause to be maintained at all times during the process of constructing the Minimum Improvements (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) 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; (2) Upon completion of construction of the Minimum Improvements and up to the Termination Date, 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: 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 Minimum Improvements. The term "replacement value" shall mean the actual replacement cost of the Minimum Improvements (excluding foundation and excavation costs and costs of underground flues, pipes, drains and other uninsurable items) and equipment, and shall be evaluated for reasonable replacement value 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 $500,000.00 in amount to, or destruction of, the Minimum Improvements or any portion thereof resulting from fire or other casualty. Net proceeds of any such insurance (Net Proceeds), shall be paid directly to Developer as its interests may appear, and Developer shall forthwith repair, reconstruct and restore the Minimum Improvements to substantially the same 11 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). Developer shall complete the repair, reconstruction and restoration of Minimum Improvements whether or not the Net Proceeds of insurance received by Developer for such Purposes are sufficient. 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 Minimum Improvements in good repair and working order, ordinary wear and tear excepted, 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 such person's tenure. In connection with this obligation, Developer shall have the right to rely upon the representations of any party with whom they do business and shall not be obligated to perform any further examination into such party's background. 4.7. Non-Transferability. Until such time as the Minimum Improvements are complete (as certified by City under Section 2.4), 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 in City's sole discretion. 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: 12 (1) Devote the Property to, and only to and in accordance with, the uses specified in the Urban Renewal Plan and City represents and agrees that use of the Property as an office building as defined in Section 2.1 is in full compliance with the Urban Renewal Plan; and (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. 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 agree 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 Minimum Improvements. (2) Except for any gross negligence, willful misrepresentation or any willful or wanton misconduct or any unlawful act of the Indemnified Parties, Developer agree 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, caused and 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 Minimum Improvements 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 13 member, officer, agent, servant or employee of City in their 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 for which 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. 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 Developer Minimum Improvements and the Property. (2) Failure by Developer to cause the construction of the Minimum Improvements to be commenced and completed pursuant to the terms, conditions and limitations of this Agreement. (3) Transfer of any interest by Developer of the Minimum Improvements in violation of the provisions of this Agreement. (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 the defaulting party (and the holder of any mortgage encumbering any interest in the Property of which City has been notified of in writing if Developer is the defaulting party) 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) days and the defaulting party 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 14 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 may withhold the Certificate of Completion; or (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) In any case, where, subsequent to default or breach by Developer under this Agreement, the holder of any mortgage on the Property or part thereof: (a) Has, but does not exercise, the option to construct or complete the Minimum Improvements or part thereof covered by its mortgage or to which it has obtained title, and such failure continues for a period of sixty (60) days after the holder has been notified or informed of the default or breach; or (b) Undertakes construction or completion of the Minimum Improvements but does not complete such construction within the period as agreed upon by the City (which period shall in any event be at least as long as the period prescribed for such construction or completion in this Agreement), and such default shall not have been cured within sixty (60) days after written demand by City so to do, City shall have the option of paying to the holder the amount of the mortgage debt and securing an assignment of the mortgage and the debt secured thereby, or in the event ownership of the Property (or part thereof) has vested in such holder by way of foreclosure or action in lieu thereof, City shall be entitled, at its option, to a conveyance to it of the Property or part thereof (as the case may be) upon payment to such holder of an amount equal to the sum of: (i) mortgage debt (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings); (ii) all expenses with respect to the foreclosure; (iii) the net expense, if any (exclusive of general overhead), incurred by such .holder in and as a direct result of the subsequent management of the Property; (iv) the costs of any improvements made by such holder; and (v) an amount equivalent to the interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage debt and such debt had continued in existence and every mortgage instrument made prior to completion of the Minimum Improvements with respect to the Property by Developer or successor in interest shall so provide. 15 (6) In the event of a default or breach prior to the completion of the Minimum Improvements by Developer, in or of any of its obligations under, and to the holder of, any mortgage or other instrument creating an encumbrance or holder of, any mortgage or other instrument creating an encumbrance or lien upon the Property or part thereof, City may at its option cure such default or breach, in which case City shall be entitled, in addition to and without limitation upon any other rights or remedies to which it shall be entitled by this Agreement, operation of law, or otherwise, to reimbursement from Developer of all costs and expenses incurred by City, together with interest on such costs and expenses at the highest rate of interest then allowable by law, in curing such default or breach and to a lien upon the Property (or the part thereof to which the mortgage,. encumbrance, or lien relates) for such reimbursement; Provided, that any such lien shall be subject always to the lien of (including any lien contemplated, because of advances yet to be made, by) the then existing mortgages on the Property authorized by this Agreement. 5.3. No Remedy 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. 5.4. 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. 5.5. 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. 5.6. 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 its performance under this 16 Agreement until it 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 having been deposited in any U.S. Postal Service and sent by registered or certified mail, postage prepaid, or one (1) business day after deposit with a nationally recognized overnight courier, addressed as follows: If to Developer: Dubuque Initiatives Attn: William H. Callahan, President P.O. Box 1745 Dubuque, Iowa 52001 With copy to: Dave Clemens, Esq. Clemens, Walters, Conlon, and Meyer, P.C. 2080 South Park Court Dubuque, IA 52003 Telephone: (563) 582-2926 Facsimile: (563) 582-2998 If to City: City Manager 50 W. 13th Street Dubuque, Iowa 52001 Phone: (563) 589-4110 Fax: (563) 589-4149 With copy to: City Attorney City Hall 50 W. 13t" Street Dubuque, IA 52001 or at such other address with respect to any 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 December 31, 2031 (the Termination Date). 6.4. Execution By Facsimile. The parties agree that this Agreement may be transmitted between them by facsimile. The parties intend that the faxed signatures 17 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. City shall promptly record a Memorandum of Development Agreement in the form attached hereto as Exhibit C in the office of the Recorder of Dubuque County, Iowa. Developer shall pay the costs for so recording. CITY OF DUBUQUE, IOWA By: By: Roy D. Buol, Mayor Jeanne F. Schneider, City Clerk DUBUQUE INITIATIVES By: William H. Callahan, President 18 List of Exhibits Exhibit A Opinion of Counsel to Developer Exhibit B Agreement Between the City of Dubuque, Iowa and International Business Machines Corporation Exhibit C Memorandum of Development Agreement Exhibit D Guaranty Exhibit E Donor Advised Permanent Fund Agreement: The IBM Endowed Fund for a Sustainable Dubuque Mayor and City Councilmembers Cit~r Hall 13t and Central Avenue Dubuque IA 52001 RE: Development Agreement Between the City of Dubuque, Iowa, and Dubuque Initiatives Dear Mayor and City Councilmembers: We have acted as counsel for Dubuque Initiatives, (Developer) in connection with the execution and delivery of a certain Development Agreement (Development Agreement) between Developer, and the City of Dubuque, Iowa (City) dated for reference purposes the day of , 20_. We have examined the original certified copy, or copies otherwise identified to our satisfaction as being true copies, of the Development Agreement and such other documents and records as we have deemed relevant and necessary as a basis for the opinions set forth herein. Based on the pertinent law, the foregoing examination and such other inquiries as we have deemed appropriate, we are of the opinion that: 1. Developer is anot-for-profit corporation organized and existing under the laws of the State of Iowa and has full power and authority to execute, deliver and perform in full the Development Agreement. The Development Agreement has been duly and validly authorized, executed and delivered by Developer and, assuming due authorization, execution and delivery by City, is in full force and effect and is valid and legally binding instrument of Developer enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization or other laws relating to or affecting creditors' rights generally. 2. The execution, delivery and performance by Developer of the Development Agreement and the carrying out of the terms thereof, will not result in violation of any provision of, or in default under, the articles of organization and operating agreement of Developer, any indenture, mortgage, deed of trust, indebtedness, agreement, judgment, decree, order, statute, rule, regulation or restriction to which Developer is a party or by which Developer's property is bound or subject. 3. To our actual knowledge, there are no actions, suits or proceedings pending or threatened against or affecting Developer in any court or before any arbitrator or before or by any governmental body in which there is a reasonable possibility of an adverse decision which could materially adversely affect the business (present or prospective), financial position or results of operations of Developer or which in any manner raises any questions affecting the validity of the Agreement or the Developer's ability to perform Developer's obligations thereunder. EXHIBIT B AGREEMENT BETWEEN THE CITY OF DUBUQUE, IOWA AND INTERNATIONAL BUSINESS MACHINES EXHIBIT C MEMORANDUM OF DEVELOPMENT AGREEMENT Prepared by: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 Return to: Barry A. Lindahl 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 Dubuque Initiatives was made regarding the following described premises: A parcel of land marked "Public Square" on the United States Commissioners' Plat of the Survey of the Town of Dubuque, Iowa and numbered as Lots 141, 142, and 143a, on the various wall maps of the City of Dubuque, Iowa; and, City Lots 143, 144 and 145, in the City of Dubuque, Iowa, according to the plat thereof in Book of Plats 34, page 353, records of Dubuque County, Iowa, also described as follows: Part of the United States Commissioners' Government Plat of the Original Town, now City, of Dubuque, in Dubuque County, Iowa, described as follows: Beginning at the southwesterly corner of Lot 141, originally designated as the southwesterly corner of the "Public Square", being also the intersection of the east line of Locust Street and the north line of West Seventh Street; thence North 22 degrees 30 minutes West along the east line of Locust Street to the northwesterly corner of Lot 145, being also the intersection of the east line of Locust Street and the southerly line of West Eighth Street; thence northeasterly along the northerly line of Lot 145 to the northeasterly corner of Lot 145, being also the intersection of the south line of West Eighth Street and the west line of the thirty foot alley East of Locust Street; thence southeasterly along the west line of said thirty foot alley to the southeasterly corner of Lot 141, originally designated as the southeasterly corner of the "Public Square", being also the intersection of the west line of the thirty foot alley and the north line of West Seventh Street; thence South 67 degrees 30 minutes West to the point of beginning, according to the Plat thereof recorded as Instrument No. 1798- 77, records of Dubuque County, Iowa. 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 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 GUARANTY AGREEMENT BETWEEN THE CITY OF DUBUQUE, IOWA, AS GUARANTOR AND THIS GUARANTY AGREEMENT is made and entered into as of 2009 ("the Guaranty"), by and between the City of Dubuque, Iowa, a municipal corporation duly organized and existing under the laws of the State of Iowa and acting pursuant to Chapters 15A and 403 of the Code of Iowa, as amended ("Guarantor"), and Dubuque Bank & Trust Company, ("Banks"). WITNESSETH: WHEREAS, Banks intend to make a loan to Dubuque Initiatives ("Borrower") in the principal amount of not to exceed $ ("the Loan"), pursuant to a Loan Agreement dated as of 2009 between Banks and Borrower ("the Agreement"); and WHEREAS, the proceeds derived from the Loan are to be applied by Borrower to the payment of costs associated with the rehabilitation, renovation, and improvement of approximately square feet of office/retail space in the Dubuque Building located generally at 700 Locust Street, Dubuque, Iowa ("the Project"), in fulfillment of the Borrower's obligations under that certain Development Agreement dated , 2008 between and among Guarantor and Borrower ("the Development Agreement"); and WHEREAS, Guarantor desires that Banks make the Loan and is willing to enter into this Guaranty in order to secure the payment of the Loan and as an inducement to Banks to enter into the Agreement. NOW, THEREFORE, in consideration of Banks entering into the Agreement and as an inducement to Banks to enter into the Agreement and make the Loan, Guarantor does hereby, subject to the terms hereof, covenant and agree with Banks as follows: SECTION 1. REPRESENTATIONS AND WARRANTIES OF GUARANTOR. Guarantor hereby represents and warrants: 1.1. It is a municipal corporation under the laws of the State of Iowa with the power to enter into this Guaranty and has duly authorized the execution and delivery of this Guaranty, and neither this Guaranty nor the agreements herein contained or the transactions contemplated hereby contravene or constitute a default under any agreement, instrument or indenture or any other agreement or requirement of law by which Guarantor is bound. 1.2. This Agreement, upon execution and delivery by Guarantor (assuming due authorization, execution and delivery by Banks, is a valid and legally binding instrument of Guarantor, enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization or other laws relating to or affecting creditors' rights generally. 1.3. The undertaking of the Project by Borrower pursuant to the Development Agreement is in the vital and best interests of Guarantor 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, and the Development Agreement and this Guaranty are necessary to promote and further the economic development of the City of Dubuque, and will result in the creation and maintenance of jobs within the City, as authorized and defined in Section 15A.1 of the Code of Iowa, as amended. SECTION 2. COVENANTS AND AGREEMENTS. 2.1. Unconditional Guaranty. Guarantor hereby unconditionally and irrevocably guarantees to Banks that (a) the full and prompt payment of the principal on the Loan when and as the same shall become due, whether at the stated maturity thereof, by acceleration, or otherwise, and (b) the full and prompt payment of all interest on the Loan when and as the same shall become due. All payments by Guarantor shall be paid in lawful money of the United States of America. Each and every default in payment of the principal of or interest on the Loan shall give rise to a separate cause of action hereunder, and separate suits may be brought hereunder as each cause of action arises. 2.2. Notice to Guarantor to Perform Under Guaranty. If Borrower should at any time fail to make any of the payments required under the Agreement as and when said payments become due and payable, Guarantor hereby unconditionally covenants that it shall make said payments within thirty (30) days after receipt by Guarantor of written notice of such failure to pay from Banks. 2.3. Guaranty to Remain in Force Until Full Payment. The obligations of Guarantor under this Guaranty shall be absolute, unconditional and irrevocable and shall remain in full force and effect until the aggregate principal amount of the Loan outstanding and all interest due thereon shall have been paid in full and such obligations shall not be affected, modified or impaired upon the happening from time to time of any event, including without limitation any of the following, whether or not with notice to, or the consent of, Guarantor: (1) the compromise, settlement, release or termination of any or all of the obligations, covenants or agreements of Borrower under the Agreement; (2) the failure to give notice to Guarantor of the occurrence of an event of default under the terms and provisions of this Guaranty or the Agreement; (3) the assignment, transfer or mortgaging or the purported assignment, transfer or mortgaging of all or any part of the interest of Borrower in the Project or any failure of title with respect to Borrower's interest in the Project; (4) the waiver of the payment, performance or observance by Borrower or Guarantor of any of the obligations, covenants or agreements of them contained in the Agreement or this Guaranty; (5) the extension of the time for payment of any principal of or interest on the Loan or under this Guaranty or of the time for performance of any other obligations, covenants or agreements under or arising out of the Agreement or this Guaranty or the extension or the renewal of either thereof; (6) the modification or amendment (whether material or otherwise) of any obligation, covenant or agreement set forth in the Agreement; (7) the taking or the omission of any of the actions referred to in the Agreement and any actions under this Guaranty; (8) any failure, omission, delay or lack on the part of Banks to enforce, assert or exercise any right, power or remedy conferred on Banks in this Guaranty or the Agreement, or any other act or acts on the part of Banks; (9) the voluntary or involuntary liquidation, dissolution, sale or other disposition of all or substantially all the assets, marshalling of assets and liabilities, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition with creditors or readjustment of, or other similar proceedings affecting Guarantor or Borrower or any of the assets of them, or any allegation or contest of the validity of this Guaranty in any such proceeding; (10) to the extent permitted by law, the release or discharge of Guarantor from the performance or observance of any obligation, covenant or agreement contained in this Guaranty by operation of law; (11) the default or failure of Guarantor fully to perform any of its obligations set forth in this Guaranty, provided that the specific enumeration of the above-mentioned acts, failures or omissions shall not be deemed to exclude any other acts,. failures or omissions, though not specifically mentioned above, it being the purpose and intent of this paragraph that the obligation of Guarantor shall be absolute, unconditional and irrevocable to the extent herein specified and shall not be discharged, impaired or varied except by the payment of the principal of and interest on the Loan in accordance with the terms of the Agreement. Without limiting any of the other -terms or provisions hereof, it is understood hereunder, there shall be no obligation on the part of Banks to resort in any manner or form for payment to Borrower or to any other person, firm or corporation, their properties or estates. 2.4. Liability Not Affected by Bankruptcy. Without limiting the foregoing, it is specifically understood that any modification, limitation, or discharge of the liability of Guarantor hereunder arising out of or by virtue of any bankruptcy, arrangement, reorganization or similar proceeding for relief of debtors under Federal or State law hereafter initiated by or against Guarantor shall not affect, modify, limit, or discharge the liability of Guarantor hereunder in any manner whatsoever and this Guaranty shall remain and continue in full force and effect and shall be enforceable against the Guarantor to the same extent and with the same force and effect as if any such proceedings had not been instituted; and it is the intent and purpose of this Guaranty and the Guarantor shall and does hereby waive all rights and benefits which might accrue to it by reason of any such proceeding and the Guarantor agrees that it shall be liable for an amount equal to the full amount of payments payable under the terms of the Agreement, irrespective and without regard to any modification, limitation, or discharge of the liability of the Guarantor that may result from any such proceeding. 2.5. Right to Proceed Against Guarantor. In the event of a default in the payment of principal of the Loan when and as the same shall become due, whether at the stated maturity thereof, by acceleration, or otherwise, or in the event of a default in the payment of any interest on the Loan when and as the same shall become due, Banks may, in their sole discretion, have the right to proceed first and directly against Guarantor under this Guaranty without proceeding against or exhausting any other remedies which it may have and without resorting to any other security held by Banks. 2.6. Waiver of Notice and Reliance on Guaranty. Guarantor expressly waives notice from Bank of its acceptance and reliance on this Guaranty. Guarantor agrees to pay all costs, expenses and fees, including all reasonable attorneys' fees, which may be incurred in enforcing or attempting to enforce this Guaranty following any default on the part of Guarantor hereunder, whether the same shall be enforced by suit or otherwise. SECTION 3. MISCELLANEOUS. 3.1. Obligations Absolute and Unconditional. The obligations of Guarantor hereunder shall arise absolutely, unconditionally and irrevocably, when the Loan shall have been made to Borrower by Banks. 3.2. Nonexclusive Remedy; Notice; Waiver; Amendment. No remedy herein conferred upon or reserved to Banks 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 Guaranty or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any default, omission or failure of performance hereunder 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. In order to entitle Banks to exercise any remedy reserved to it in this Guaranty, it shall not be necessary to give any notice, other than such notice as may be herein expressly required. In the event any provision contained in this Guaranty should be breached by Guarantor and thereafter duly waived by Banks, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder. No waiver, amendment, release or modification of this Guaranty shall be established by conduct, custom or course of dealing, but solely by an instrument in writing duly executed by Banks. 3.3. Annual Audit and Financial Statements. Guarantor shall keep proper books of record and account in accordance with generally accepted principles of accounting as the same apply to governmental entities and will furnish to Banks as soon as available and in any event within 180 days after the close of each fiscal year of Guarantor, a copy of the annual financial statements of Guarantor for such fiscal year all as prepared and certified by a firm of independent certified public accountants. 3.4. Entire Agreement. This Guaranty constitutes the entire agreement and supersedes all prior agreements between the parties with respect to the subject matter hereof and may be executed simultaneously in several counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. 3.5. Severability. The invalidity or unenforceability of any one or more phrases, sentences, clauses or Sections in this Guaranty shall not affect the validity or enforceability of the remaining portions of this Guaranty, or any part thereof. 3.6. Release. Upon full payment of the principal of and interest on the Loan in accordance with the Agreement, this Guaranty shall by its terms terminate and, upon request by Guarantor, Bank shall release Guarantor from the provisions of this Guaranty in writing. 3.7. Applicable Law. This Guaranty shall be governed by and construed in accordance with the laws of the State of Iowa. IN WITNESS WHEREOF, Guarantor and Bank have caused this Guaranty to be executed as of the date first above written. crrv ®~ ®uu~uE, iov~,a ®uu~uE ~~~ CRUST c®nnP,~~v By: By: Roy D. Buol, Mayor Its: ATTEST: By: Jeanne F. Schneider, CMC City Clerk EXhiBIT E Donor Advised Permanent Fund Agreement: The IBM Endowed Fund for a Sustainable Dubuque ENDOW IOWA DONOR ADVISED PERMANENT ENDOWED FUND AGREEMENT THE IBM ENDOWED FUND FOR A SUSTAINABLE DUBUQUE THIS AGREEMENT, for convenience dated this 24th day of November, 2008 by Dubuque Initiatives (hereinafter referred to as "Donor") to evidence the absolute transfer by the Donor of certain property to the Community Foundation of Greater Dubuque (herein after referred to as the "Foundation") for its public, charitable, scientific, literary and educational purposes, in order to establish with such property a Donor Advised Permanent Endowed Fund under the Endow Iowa provisions under Iowa Code Section 15E.301 et. seq. It is hereby acknowledged that the terms of this fund and its future administration are intended to comply with the terms and conditions of Endow Iowa legislation including but not limited to the provision that the Fund be a permanent endowment, as defined, and that the Fund benefit Iowa charities or Iowa charitable causes, and that it be established in a qualifying Community Foundation as defined. This shall be done in accordance with the provisions set forth below. 1. NAME OF FUND: The name of the Donor Advised Permanent Endowed Fund established with property transferred hereunder (the "Fund") shall be the IBM Endowed Fund for a Sustainable Dubuque. Donor reserves the right to change the name of the fund. 2. INITIAL CONTRIBUTION: The Donor hereby gives, assigns, and transfers to the Foundation for its public, charitable, scientific, literary and educational purposes, the property described in Exhibit "A" attached hereto and made a part hereof. It is understood that subsequent contributions may be made to this Fund at any time. 3. ACCEPTANCE OF PROPERTY: The Foundation hereby accepts the property transferred and affirms that it will hold such and any additional property transferred to the Fund on the terms and subject to the conditions set forth by this agreement for a Donor Advised Permanent Endowed Fund. The guidelines and procedures for such Funds are described in the Foundation's governing instruments, including its Articles of Incorporation and Bylaws, in effect, as amended from time to time. 4. FUND MANAGEMENT: Control over the investment and reinvestment of all property and the asset management of the Fund will be exercised exclusively by the Foundation. The assets of the Fund, like all other permanent assets of the Foundation, will be professionally managed with the long-term objectives of safeguarding principal, increasing the principal through long-term total return, and generating income for charitable distributions. To attain these objectives, the remainder of the growth after authorized distributions and expenses will be added back to the principal. 5. ALLOCATION FOR FOUNDATION SUPPORT SERVICES: The Foundation shall receive an annual allocation for administrative services. The Donor agrees to be bound by the most current schedule of fees published by the Foundation. The Donor further understands that the fee schedule is subject to modification and may be increased or decreased at the sole discretion of the Foundation's Board of Directors. Allocations will be paid from the corpus of the Fund. 6. PURPOSE: The proceeds of the Fund will be distributed annually to support Sustainability Initiatives in targeted neighborhoods in the City of Dubuque. "Sustainability Initiatives" are those initiatives that ensure that Dubuque is a viable, livable, and equitable community embracing economic prosperity, sociaUcultural vibrancy and environmental integrity to create a sustainable legacy for generations to come. 7. DISTRIBUTION AND PRIVILEGE TO ADVISE: The Foundation will make annual distributions in accordance with the authorized spending level for charitable giving determined each February in a manner approved by the Foundation's Board of Directors. The distribution will come from the net income and/or corpus of the Fund up to 5% of the Fund's previous twelve quarter rolling average balance. The Donor shall have the privilege of consulting with, advising, and making recommendations to the Foundation. with respect to charitable distributions made from the Fund. Such distributions shall be made in accordance with the Foundation's distribution policies, with a minimum of $250 per grant required. All such distributions will require the fmal approval of the Board of Directors of Community Foundation of Greater Dubuque, an IRS requirement for community foundations. If the Foundation does not receive Donor recommendations regarding gift distribution for a period up to two years from the date of the fund transfer or from the date of that last presentation to recipients the Foundation's Board of Directors has the authority to make gift distributions to charitable causes. Unless the Donor specifically requests anonymity, recipients of grants from this Fund will be notified as to the name of the Fund and its Donor. In addition, information about such grants will be published in the Foundation's annual report, periodic news releases, etc. However, the Donor stipulates that although existence of the Fund maybe publicized, the value of the Fund and the amounts of specific grants shall not be publicized. Grants to individuals from donor-advised funds are prohibited. Distributions are restricted to charitable causes and concerns and may not be used for any private benefit, including school tuition, dues or memberships, benefit tickets, fundraising dinners, your time or services, gifts to individuals, or goods bought at auction. No grants, loans, compensation or similar payments (including expense reimbursements) may be paid from donor- advised funds to donors, advisors, or related parties. Pledge cards cannot be forwarded with distributions. However, distributions may be designated for a specific purpose or allocation and this information will be included in the transmittal letter. This prohibition extends to prevent, at minimum, donors, advisors, and related parties from receiving benefits. 7. DISSOLUTION: In the event of the dissolution of the Donor, the Foundation shall thereafter continue to hold the assets constituting the Fund and shall distribute the income therefrom for such uses as in the opinion of the Board of the Foundation most clearly meet the purposes and objectives of the Sustainability Initiatives, as defined herein. 8. FUND NOT A SEPARATE TRUST: The Fund shall be organized and administered so that the federal income tax status of the Foundation as a public charitable organization under Section 501 (c)(3) of the Internal Revenue Code, as amended, will not be adversely affected under this arrangement. This agreement will be interpreted in a manner consistent with the federal income tax provisions and regulations that govern the operation of the Foundation, and it may be amended form time to time by the Foundation's Board to conform to such provisions and regulations. 9. NO AMENDMENT: The Donor understands and declares that this donation is absolute and irrevocable and that, after the execution of this instrument, the Donor has no right, title, interest, or incidents of ownership in the property described in Exhibit A or any additional property transferred to this Fund. The Donor shall have no right to alter, amend, or terminate this instrument. IN WITNESS WHEREOF, this Agreement has been executed by the Donor and on behalf of the Foundation on the day and year first above written. BY: Donor BY: Donor BY: Community Foundation of Greater Dubuque Nancy Van Milligen, President/CEO