Dubuque Stamping & Mfg Enterprise Zone AgreementIOWA ECONOMIC DEVELOPMENT AUTHORITY
200 East Grand Avenue l Des Moines, Iowa 50309 USA 1 Phone: 515.725.3000
iowaeconomicdevelopment.com
December 9, 2013
Mr. Darold Vickerman, Chief Financial Officer
Dubuque Stamping & Manufacturing, Inc.
3190 Jackson Street
Dubuque, IA 52001
economic development
Certified Return Receipt Request
NOTICE OF DEFAULT -
Unable To Cure
RE: Notice of Default Letter - Dubuque Stamping & Manufacturing
Master Contract #P0806M01729
Funding Agreement #08 -EZ -034
Dear Mr. Vickerman:
Our analysis of the End of Project Report submitted by you has led to the determination that an Event of
Default has occurred due to the failure by Dubuque Stamping & Manufacturing to meet the job creation
requirements of the above referenced Contract. The business is in default of Master Contract Article 8.2(a)
Job Obligations:
8.2 Job Obligations; Benefits Requirements.
(a) Jobs and Wages. By the Project Completion Date, the Business shall create /retain the number of
FTE Created Jobs and Retained Jobs above the Business' Employment Base and maintain the jobs through the Job
Maintenance Period, all as detailed in Exhibit D. The Business shall pay the wage rates identified in Exhibit D.
The Contract requires the company to create 10 full -time equivalent (FTE) jobs above a base employment of
155 FTEs. Documentation from the End of Project Report submitted November 20, 2013 and Annual
Report submitted July 31, 2013 reports a total employment of 132 FTE's, which is below the base
employment number. The business has not met the minimum EZ program eligibility requirements and will
therefore be required to repay the benefits received under this award.
As a cure is not possible or feasible per Article 9.5 of the Master Contract, the tax credits formerly available
under Funding Agreement #08 -EZ -034 will be rescinded. A copy of this Notice of Default will also be
provided to the Iowa Department of Revenue (IDR) since it is the state agency authorized to collect tax
credit benefits that have been claimed. The method, amount and schedule of repayment will be determined
by the IDR.
Should you have any questions, please feel free to contact Lisa Connell at 515 - 725 -3014 or
lisa.connell @iowa.gov. -
Sincerely,
Rita C. Grimm
Chief Operating Officer /General Counsel
Cc: Mayor Roy Boul, City of Dubuque
Angela Gullickson, Iowa Department of Revenue
IEDA File
Governor Terry E. Branstad 1 Lt. Governor Kim Reynolds 1 Director Debi V. Durham
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TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Housing Enterprise Zone Program Agreement Number 07-HEZ-045 for
Dubuque Stamping & Manufacturing, Inc.
DATE: February 11, 2009
On May 16, 2008, the City Enterprise Zone Commission approved an application to the
Iowa Department of Economic Development (IDED) on behalf of Dubuque Stamping &
Manufacturing, Inc. for Enterprise Zone benefits related to the expansion of their
operations on Jackson Street. IDED approved the application on June 19, 2008.
Economic Development Director Dave Heiar recommends City Council approval of the
proposed Enterprise Zone Program Agreement for Dubuque Stamping & Manufacturing,
Inc. This agreement will provide State of Iowa financial benefits to a local company
making a substantial investment in our community. There is no commitment within the
agreement of any further City assistance.
The project includes the construction of a 20,000 square foot building and the purchase
of over $3 million worth of new equipment to improve operations.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David J. Heiar, Economic Development Director
DATE: February 11, 2009
INTRODUCTION
This memorandum presents for City Council approval an Enterprise Zone Program
Agreement by and among the Iowa Department of Economic Development (IDED), the City
and Dubuque Stamping & Manufacturing, Inc. The City Council is requested to adopt a
resolution approving the agreement.
BACKGROUND
On May 16, 2008, the City Enterprise Zone Commission approved an application to IDED
on behalf of Dubuque Stamping & Manufacturing, Inc. for Enterprise Zone benefits related
to the expansion of their operations on Jackson Street. IDED approved the application on
June 19, 2008.
DISCUSSION
Attached to this memorandum is a resolution that provides for the approval of the
agreement for Enterprise Zone benefits for Dubuque Stamping & Manufacturing, Inc. The
resolution authorizes and directs the Mayor to execute the agreement on behalf of the City.
The agreement outlines the State benefits that will accrue to the Company based on their
plans to expand their manufacturing facility.
The project includes the construction of a 20,000 square foot building and the purchase of
over $3 million worth of new equipment to improve operations. A copy of the agreement is
attached to the resolution.
RECOMMENDATION
I recommend that the City Council approve the proposed Enterprise Zone Program
Agreement for Dubuque Stamping & Manufacturing, Inc. by adopting the attached
resolution. This agreement will provide State of Iowa financial benefits to a local
companymaking a substantial investment in our community. There is no commitment within
the agreement of any further City assistance.
ACTT®N STEP
The action step for the Council is to adopt the attached resolution.
attachments
F:\USERS\Adejong\Enterprise Zone\Dubuque Stamping\20090211 Council Memo.doc
RESOLUTION NO.65 -0 9
RESOLUTION APPROVING A MASTER CONTRACT AND ENTERPRISE ZONE
PROGRAM AGREEMENT BY AND AMONG THE IOWA DEPARTMENT OF ECONOMIC
DEVELOPMENT, THE CITY OF DUBUQUE AND DUBUQUE STAMPING &
MANUFACTURING, INC.
Whereas, the City of Dubuque has established two Enterprise Zones and an
Enterprise Zone Commission; and
Whereas, the Enterprise Zone Commission on May 15, 2008 approved the
application of Dubuque Stamping & Manufacturing, Inc. for Enterprise Zone benefits; and
Whereas, Dubuque Stamping & Manufacturing, Inc.'s application was approved by the
Iowa Department of Economic Development on June 19, 2008; and
Whereas, the Iowa Department of Economic Development has prepared and
submitted for City Council approval an agreement relating to Enterprise Zone benefits for
Dubuque Stamping & Manufacturing, Inc. a copy of which is attached hereto and by this
reference made a part hereof; and
Whereas, the City Council finds that the proposed agreement is acceptable and
necessary to the growth and development of the city.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the Iowa Department of Economic Development Housing
Enterprise Zone Program Agreement, Number 08-EZ-034, is hereby
approved.
Section 2. That the Mayor is hereby authorized and directed to execute the
Agreement on behalf of the City of Dubuque and forward the
executed copy to the Iowa Department of Economic Development for
their approval.
Passed, approved and adopted this 16th day of February, 2009
Roy D. Buol, Mayor
Attest:
Jeanne F. Schneider, City Clerk
MASTER CONTRACT
BY AND BETWEEN
Dubuque Stamping & Manufacturing, Inc.
AND THE
IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT
CONTRACT NUMBER: P0806M01729
TABLE ®F C®1~TEl~TS
ARTICLE 1. MASTER CONTRACT DURATION; FUNDING AGREEMENT DURATION
ARTICLE 2. FUNDING
Article 2.1 Funding Sources
Article 2.2 Reduction, Discontinuance or Alteration of Funding
ARTICLE 3. CONTRACT STRUCTURE AND DEFINITIONS; DOCUMENTS INCORPORATED BY
REFERENCE; ORDER OF PRIORITY
Article 3.1 Contract Structure and Definitions
Article 3.2 Documents Incorporated by Reference
Article 3.3 Business's Financial Assistance Application on File
Article 3.4 Order of Priority
ARTICLE 4. AWARD
Article 4.1 Description of the Project and Award Budget
Article 4.2 Job Obligations
Article 4.3 Repayment Obligation
ARTICLE 5. CONDITIONS TO DISBURSEMENT OF FUNDS; DISBURSEMENT TERMS
As°ticle S.1
Article 5.2
Article 5.3
Article 5.4
Article S. S
ARTICLE 6. SEC
Article 6.1
Article 6.2
Article 6.3
Documents Submitted
Prior Costs
Cost Variation
Suspension of Disburseftaent
Investment ofAward Proceeds
JRITY; CROSS-COLLATERALIZATION
Secured Property
Value of Collateral
Additional or Substitute Collateral
ARTICLE 7. REPRESENTATIONS AND WARRANTIES
Ai°ticle 7.1 Organization and Qualifications
Article 7.2 Authority and Validity of Obligations
Article 7.3 Use of Proceeds
Article 7.4 Subsidiaries
Article 7.5 Financial Repof°ts
Article 7.6 No Material Advei°se Change
Article 7.7 Full Disclosure; Business's Financial Assistance Application
Article 7.8 Trademarks, Franchises and Licenses
Article 7.9 Governmental Authority and Licensing
Article 7.10 Litigation and Other Controversies
Article 7.11 Good Title
Article 7.12 Taxes
Article 7.13 Other Contracts
Ai°ticle 7.14 No Default
Article 7.1 S Compliance with Laws
Article 7.16 Effective Date of Repr•esentatiorzs and Warranties
Contract #P0806M01729 - 2 - Master updated 8/07
ARTICLE 8. COVI
Article 8.1
Article 8.2
Article 8.3
Article 8.4
Article 8.5
Article 8.6
Article 8.7
Article 8.8
Article 8.9
Article 8.10
Article 8.11
Article 8.12
Article 8.13
Article 8.14
Article 8.1 S
Ar°ticle 8.16
Article 8.17
'sNANTS
Maintain Existence in Iowa
Job Obligations; Benefits Requirements
Performance Obligations
Maintenance of Properties
Taxes and Assessments
Insur°ance
Required Reports
Inspection. and Audit
Compliance with Laws
Use of Award Proceeds
Changes in Business Ownership, Structure or Contr°ol
Notice of Meetings
Notice of Proceedings
Accounting Records
Restrictions
No Changes in Business Operations
Indemnification
ARTICLE 9. EVENTS OF DEFAULT AND REMEDIES
Article 9.1
Article 9.2
Article 9.3
Article 9.4
Article 9.5
ARTICLE 10. MISC
Article 10.1
Article 10.2
Ar°ticle 10.3
Article 10.4
Article 10. S
Article 10.6
Article 10.7
Article 10.8
Article 10.9
Ar°ticle 10.10
Article 10.11
Article 10.12
Article 10.13
Article 10.14
Article 10.15
Events of Default
Default Remedies
Default Interest Rate
Expenses
Notice of Default and Opportunity to Cure
ELLANEOUS
Timely Performance
State of Iowa Recognition
Choice of Law and Forum
Governing Law
Master Contract/Funding Agreement Amendments
Notices
Headings
Final Authority
Waivers
Counterparts
Survival of Representations
Severability of Provisions
Successors and Assigns
Termination.
Integration
Contract #P0806M01729 - 3 - nnaster updated sio~
MASTER CONTRACT
BUSIlVESS:
MASTER CONTRACT NUMBER:
AWARD DATE:
Dubuque Stamping & Manufacturing, Inc.
P0806M01729
June 19, 2008
This FINANCIAL ASSISTANCE CONTRACT (the "Master Contract") is made as of the
CONTRACT EFFECTIVE DATE by and between the Iowa Department of Economic Development
("IDED"), 200 East Grand Avenue, Des Moines, IA 50309 and Dubuque Stamping & Manufacturing,
Inc. an Iowa S-Corporation ("Business"), 3190 Jackson Street, Dubuque, Iowa 52001.
WHEREAS, the Business submitted an application to IDED requesting financial assistance in the
financing of its Project as more fully described in Exhibit C, Description of the Project and Award
Budget, (the "Project"); and
WHEREAS, the IDED found the Project to meet the requirements established to receive
financial assistance; and
WHEREAS, the IDED and/or the Iowa Department of Economic Development Board ("IDED
Board") have.awarded the Business financial assistance from one or more IDED-administered programs
for the Project, all of which are subject to the terms and conditions set forth herein and collectively
referred to as the "Award"; and
NOW THEREFORE, in consideration of the mutual promises contained herein and intending to
be legally bound, the Business and IDED agree to the following terms:
ARTICLE 1
MASTER CONTRACT DURATION; FUNDING AGREEMENTS DURATION
This Master Contract shall be in effect until all of Business's obligations and liabilities under this
Master Contract and all of the Funding Agreements executed in connection with this Master Contract
have been satisfied. The duration of each Funding Agreement will be as described in the Funding
Agreement.
ARTICLE 2
FUNDING
2.1 FundingSources. The sources of funding for this Award are appropriations to IDED for
financial assistance programs administered by the IDED and tax credit programs that IDED is authorized
to administer.
2.2 Reduction Discontinuance or Alteration of Funding. Any termination, reduction, or delay
of funds available due, in whole or in part, to (i) lack of, reduction in, or a deappropriation of revenues
previously appropriated by the legislature for this Award, or (ii) any other reason beyond the IDED's
control may, in the IDED's discretion, result in the termination, reduction or delay of funds to the
Business.
Contract #P0806M01729 - 4 - nnasterupdated sio7
ARTICLE 3
CONTRACT STRUCTITRE AND DEFINITIONS;
DOCUMENTS INCORPORATED BY REFERENCE; AND ORDER OF PRIORITY
3.1 Contract Structure and Definitions.
(a) This Award shall be governed by this Master Agreement and the individual funding
agreements (the "Funding Agreements") for each source of program assistance for this Award. This
Award has been provided to the Business to fund the Project described in Exhibit C, Description of the
Project and Award Budget. The Articles of this Master Contract apply to each Funding Agreement unless
a Funding Agreement specifically states otherwise.
(b) The following terms apply to this Master Contract and each of the Funding Agreements,
unless otherwise specified in a Funding Agreement:
"Award Date" means the date first stated in this Master Contract and is the date the IDED and/or
the IDED Board approved the awarding of financial assistance to the Business for the Project.
"Benefits Requirefnents"means the benefits requirements established by the Department
pursuant to statute or rule for each program that is providing financial assistance or tax credit benefits for
this Project.
"Baisiness's Employment Base" means the number of jobs as stated in Exhibit D, Job
Obligations that the Business and IDED have established as the job base for this Project. The number of
jobs the Business has pledged to create shall be in addition to the Business's Employment Base.
"Created Jobs" means the number of new FTE Jobs the Business will add over and above the
Business's Employment Base.
"Community"means City of Dubuque.
"Eligible Benefits"means all of the following: medical and dental insurance plans, pension and
profit-sharing plans, child care services, life insurance coverage, vision insurance plan, and disability
coverage.
"Forgivable Loan"means a form of an award,made by the IDED to the Business under a
Funding Agreement(s) for which repayment is eliminated in part or entirely if the Business satisfies the
terms of this Contract and the Funding Agreement(s).
"Full-time Equivalent (FTE) Job" means the employment of one person:
(a) For 8 hours per day fora 5-day, 40-hour workweek for 52 weeks per year, including paid holidays,
vacations and other paid leave, or
(b) For the number of hours or days per week, including paid holidays, vacations and other paid leave,
currently established by schedule, custom, or otherwise, as constituting a week of full-time work for
the kind of service an individual performs for an employing unit.
"Job Mairztetzaiace Period" means the date two (2) years from the Project Completion Date as
stated in Exhibit D, Job Obligations. The Business shall maintain the Project, and the created/retained
jobs through the Job Maintenance Period.
Contract #P0806M01729 - 5 - Masrer updated sio~
"Job Obligations"means the Business's Employment Base number and the new j obs to be
created that pay the required wages and benefits, all as outlined in Exhibit D, Job Obligations.
"Loazz"means form of an award made by the IDED to the Business under a Funding
Agreement(s) for which full repayment is expected.
"Project" means the description of the work and activities to be completed by the Business as
outlined in Exhibit C, Description of the Project and Award Budget, Exhibit D, Job Obligations, and
Exhibit A, Business's Financial Assistance Application.
"Project Covzpletiozz Date" means the date three (3) years from the Award Date as stated in
Exhibit D, Job Obligations. The Project Completion Date is the date by which all Project activities shall
be satisfactorily completed.
"Qualifying jobs" are those created or retained jobs that meet or exceed the Qualifying Wage
Threshold Requirement established for the programs providing assistance to this Project qualify for
program funding.
"Qualifying Wage Threshold Requirement"means the wage threshold requirement (e.g. 90%,
100%, 130% , 160% of the average county or regional wage rate) established by the Department pursuant
to statute or rule for each program that is providing financial assistance or tax credit benefits for this
Project. The Qualifying Wage Threshold Requirement for each funding source providing assistance to
this Project is outlined in Exhibit D, Job Obligations.
"Retaiized Job"means an existing job that meets the Qualifying Wage Threshold Requirements
and would be eliminated or moved to another state if the Project did not proceed in Iowa.
3.2 Documents Incorporated by Reference. The following documents are incorporated by
reference and considered an integral part of this Master Contract:
Exhibit A - Business's Financial Assistance Application, Application #08-EZ-034
Exhibit B - Funding Agreements:
B4- EZ Funding Agreement
Exhibit C - Description of the Project and Award Budget
Exhibit D - Job Obligations
3.3 Business's Financial Assistance Application on File. Due to its size, Exhibit A will not be
attached to this Master Contract, but will be kept on file at the Iowa Department of Economic
Development. It shall, nevertheless, be considered an incorporated element of this Master Contract and
the Funding Agreements.
3.4 Order of Priority. In the case of any inconsistency or conflict between the specific
provisions of this document and the exhibits, the following order of priority shall control:
(a) Master Contract, Articles 1-10
(b) Exhibit B -Funding Agreements
(c) Exhibit C -Description of the Project and Award Budget
(d) Exhibit D -Job Obligations
(e) Exhibit A -Business's Financial Assistance Application
Contract #P0806M01729 - 6 - Master updated sio7
ARTICLE 4
AWARD
4.1 Description of the Project and Award Budget. The IDED and/or the IDED Board have
approved an Award to the Business from the programs and in the amounts identified in Exhibit C,
Description of the Project and Award Budget. The Project Budget for this Award is as detailed in Exhibit
C.
4.2 Job Obligations. The IDED and/or the IDED Board have approved an Award to the
Business and the Business' Job Obligations are outlined in Exhibit D, Job Obligations.
4.3 Repayment Obli ag tion. The obligation to repay the direct financial assistance components
of this Award shall be evidenced by Promissory Notes executed in connection with the Funding
Agreements.
ARTICLE 5
CONDITIONS TO DISBURSEMENT OF FUNDS; DISBURSEMENT TERMS
The obligation of IDED to make, continue or disburse funds under this Master Contract and the
Funding Agreements shall be subject to the following conditions precedent:
5.1 Documents Submitted. IDED shall have received each of the following documents,
properly executed and completed, and approved by IDED as to form and substance:
(a) Master Contract. Fully executed Master Contract.
(b) Fundin~Agreements. Fully executed Funding Agreements.
(c) Pronzissoz:y Notes. The Promissory Notes required by the Funding Agreements.
(d) Articles ofbzcor~oration. Copies of the articles of incorporation of the Business, certif"ied in each
instance by its secretary or assistant secretary.
(e) Certificate of Corporate Existence. A certificate of existence for the Business from the Office of the
Secretary of State of Iowa.
(f) Results ofLien and Tax Search. Financing statement, tax and judgment lien search results, in the
Business's state of incorporation/organization, against the Business and Secured Property.
(g) Security Documents. The fully executed Security Documents required in Article 6.0.
(h) Other Required Documents. IDED shall have received such other contracts, instruments, documents,
certificates and opinions as the IDED may reasonably request.
(i) Hazardous Waste Audit. To comply with Iowa Code section 15A.1(3)"b," if the Business generates
solid or hazardous waste, it must either: a) submit a copy of the Business's existing in-house plan to
reduce the amount of waste and safely dispose of the waste based on an in-house audit conducted
within the past 3 years; or b) submit an outline of a plan to be developed in-house, or 3) submit
documentation that the Business has authorized the Iowa Department of Natural Resources or Iowa
Contract #P0806M01729 - 7 - Master updated s/o7
Waste Reduction Center to conduct the audit.
(j) Release Form -Confidential Tax In ormation. A signed Authorization for Release of Confidential
State Tax Information form to permit IDED to receive the Business's state tax information directly
from the Iowa Department of Revenue for purposes of annually updating the Iowa Public Return on
Investment Analysis.
(k) Satis actor;y Credit Histo~~ Documentation of satisfactory credit history of the Business and
guarantors, as applicable, with no judgments or unsatisfied liens or similar adverse credit actions.
(1) Project Financial Commitments. The Business shall have submitted documentation acceptable to
IDED from the funding sources identified in Exhibit C committing to the specified financial
involvement in the Project and received the IDED's approval of the documentation. The
documentation shall include the amount, terms and conditions of the financial commitment, as well
as any applicable schedules.
(m) Requests for Disbursement. All disbursements of Award proceeds shall be subject to receipt by the
IDED of requests for disbursement, in form and content acceptable to IDED, submitted by the
Business. All requests shall include documentation of costs that have been paid or costs to be paid
immediately upon receipt of Award proceeds.
(n) Funding Agreements Disbursement Requirements. Satisfaction of all disbursement requirements
outlined in the specific program Funding Agreements.
5.2 Prior Costs. No expenditures made prior to the Award Date maybe included as Project
costs. This restriction applies to the direct financial assistance portions of this Award, not the tax credit
benefits included in this Award.
5.3 Cost Variation. In the event that the total Project cost is less than the amount specified in
the Exhibit C, the Funding Agreements shall be reduced at the same ratio to the total Project cost
reduction as the ratio of the Funding Agreement amount to the total amount of funds provided by the
Business and all funding sources requiring a proportional reduction of their financial contribution to the
Project. Any disbursed excess above the reduced IDED participation amount shall be returned
immediately to IDED.
5.4 Suspension of Disbursement. Upon the occurrence of an Event of Default (as defined in
this Master Contract or any of the Funding Agreements) by the Business, the IDED may suspend
payments and tax credit program benefits to the Business until such time as the default has been cured to
IDED's satisfaction. Notwithstanding anything to the contrary in this Master Contract or the Funding
Agreements, upon a termination of this Master Contract on account of an Event of Default by the
Business, Business will no longer have the right to receive any disbursements or any tax credit program
benefits after the effective date of default. All Award funds may also be suspended, in IDED's sole
discretion, in the event the Business experiences a layoff within the state of Iowa or closes any of its
Iowa facilities.
5.5 Investment of Award Proceeds.
(a) In the event that the Award proceeds are not immediately utilized, temporarily idle Award
proceeds held by the Business maybe invested provided such investments shall be in accordance with
State law, including but not limited to the provisions of Iowa Code chapter 12C concerning the deposit of
public funds. Interest accrued on temporarily idle Award proceeds held by the Business shall be credited
to and expended on the Project prior to the expenditure of other Award proceeds.
Contract #P0806M01729 - 8 - Master updated s/o7
(b) All proceeds remaining, including accrued interest, after all allowable Project costs have been
paid or obligated shall be returned to the IDED within thirty (30) days after the Project Completion Date.
Within ten (10) days of receipt of a written request from IDED, Business shall inform the IDED in
writing of the amount of unexpended Award funds in the Business's possession or under the Business's
control, whether in the form of cash on hand, investments, or otherwise.
ARTICLE 6
SECURITY; CROSS-COLLATERALIZATION
The Business shall execute in favor of the IDED all security agreements, financing statements,
mortgages, personal and/or corporate guarantees (the "Security Documents") as required by the IDED.
6.1 Securi .This Award shall be secured by: None required.
6.2 Value of Collateral. The value, as reasonably determined by IDED, of the Secured
Property shall meet or exceed the amount of Award funds disbursed.
6.3 Additional or Substitute Collateral. Incase of a decline in the market value of the Secured
Property, or any part thereof, IDED may require that additional or substitute collateral of quality and
value satisfactory to IDED be pledged as Secured Property for this Award. The Business shall provide
such additional or substitute collateral Secured Property within 20 days of the date of the request for
additional or substitute collateral to secure this Award in an amount equal to or greater than the amount
of outstanding Award funds.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
The Business represents and warrants to IDED as follows:
7.1 Organization and Qualifications. The Business is duly organized, validly existing and in
good standing as a corporation under the state of its incorporation. The Business has full and adequate
power to own its property and conduct its business as now conducted, and is duly licensed or qualified
and in good standing in each jurisdiction in which the nature of the business conducted by it or the nature
of the property owned or leased by it requires such licensing or qualifying, except where the failure to so
qualify would not have a material adverse effect on the Business's ability to perform its obligations
hereunder.
7.2 Authority and Validity of Obli atg ions. The Business has full right and authority to enter
into this Master Contract and the Funding Agreements and to make the borrowings herein provided for.
The person signing this Master Contract and the Funding Agreements has full authority to:
a) sign this Master Contract and the Funding Agreements, and
b) issue Promissory Notes on behalf of the Business, and
c) secure Business's obligations under this Master Contract and the Funding Agreements, and
d) perform each and all of the obligations under the Master Contract and its Funding
Agreements.
The Master Contract and Funding Agreement documents delivered by the Business have been duly
authorized, executed and delivered by the Business and constitute the valid and binding obligations of the
Business and enforceable against it in accordance with their terms. This Master Contract, the Funding
Agreements and related documents do not contravene any provision of law or any judgment, injunction,
Contract #P0806M01729 - 9 - Master updated sio~
order or decree binding upon the Business or any provision of the articles of organization or operating
agreement of the Business, contravene or constitute a default under any covenant, indenture or contract
of or effecting the Business or any of its properties.
7.3 Use of Proceeds. The Business hereby agrees to use Award proceeds only for the Project
and for the activities described in Exhibit C, Description of the Project and Award Budget, this Master
Contract and the Funding Agreements. Use of Award proceeds shall conform to the Budget for the
Project as detailed in Exhibit C. The Business represents that there are legally enforceable commitments
in place from the funding sources identified for the Project in Exhibit C.
7.4 Subsidiaries. The Business has no Subsidiaries on the Contract Effective Date.
7.5 Financial Reports. The balance sheet of the Business furnished to IDED as of the Contract
Effective Date, fairly presents its financial condition as at said date in conformity with GAAP applied on
a consistent basis. The Business has no contingent liabilities which are material to it, other than as
indicated on such financial statements or, with respect to future periods, on the financial statements
furnished to IDED.
7.6 No Material Adverse Change. Since the Award Date, there has been no change in the
condition (financial or otherwise) or business prospects of the Business, except those occurring in the
ordinary course of business, none of which individually or in the aggregate have been materially adverse.
To the knowledge of the Business, there has been no material adverse change in the condition of the
Business (financial or otherwise) or the business prospects of the Business
7.7 Full Disclosure• Business's Financial Assistance Application. The statements and other
information furnished to the IDED by Business in its Financial Assistance Application and in connection
with the negotiation of this Master Contract and the Funding Agreements do not contain any untrue
statements of a material fact or omit a material fact necessary to make the material statements contained
herein or therein not misleading. The IDED acknowledges that as to any projections furnished to the
IDED, the Business only represents that the same were prepared on the basis of information and
estimates it believed to be reasonable.
7.8 Trademarks, Franchises and Licenses. The Business owns, possesses, or has the right to
use all necessary patents, licenses, franchises, trademarks, trade names, trade styles, copyrights, trade
secrets, know how and confidential commercial and proprietary information to conduct its businesses as
now conducted, without known conflict with any patent, license, franchise, trademark, trade name, trade
style, copyright or other proprietary right of any other Person. As used in this Master Contract, "Person "
means an individual, partnership, corporation, association, trust, unincorporated organization or any other
entity or organization, including a government or agency or political subdivision thereof.
7.9 Governmental Authority and Licensing. The Business has received all licenses, permits,
and approvals of all Federal, state, local, and foreign governmental authorities, if any, necessary to
conduct its businesses, in each case where the failure to obtain or maintain the same could reasonably be
expected to have a material adverse effect. No investigation or proceeding which, if adversely
determined, could reasonably be expected to result in revocation or denial of any material license, permit,
or approval is pending or, to the knowledge of the Business threatened.
7.10 Litigation and Other Controversies. There is no litigation or governmental proceeding
pending, nor to the knowledge of the Business threatened, against the Business which if adversely
determined would result in any material adverse change in the financial condition, Properties, business or
operations of the Business, nor is the Business aware of any existing basis for any such litigation or
Contract #P0806M01729 - 10 - Master updated sio~
governmental proceeding.
7.11 Good Title. The Business has good and defensible title (or valid leasehold interests) to all
of its Property (including, without limitation, the Secured Property) reflected on the most recent balance
sheets furnished to the IDED (except for sales of assets in the ordinary course business).
7.12 Taxes. All tax returns required to be filed by the Business in any jurisdiction have, in fact,
been filed, and all taxes, assessments, fees and other governmental charges upon the Business or upon
any of its property, income or franchises, which are shown to be due and payable in such returns, have
been paid, except such taxes, assessments, fees and governmental charges, if any, as are being contested
in good faith and by appropriate proceedings which prevent enforcement of the matter under contest and
as to which adequate reserves established in accordance with GAAP have been provided. The Business
knows of no proposed additional tax assessment against it for which adequate provisions in accordance
with GAAP have not been made on its accounts. Adequate provisions in accordance with GAAP for
taxes on the books of the Business have been made for all open years, and for their current fiscal period.
7.13 Other Contracts. The Business is not in default under the terms or any covenant, indenture
or contract of or affecting either the Business or any of its properties, which default, if uncured, would
have a material adverse effect on its financial condition, properties, business or operations.
7.14 No Default. No Default or Event of Default has occurred or is continuing.
7.15 Compliance with Laws. The Business is in compliance with the requirements of all
federal, state and local laws, rules and regulations applicable to or pertaining to the business operations
of the Business and laws and regulations establishing quality criteria and standards for air, water, land
and toxic or hazardous wastes or substances, non-compliance with which could have a material adverse
effect on the financial condition, properties, business or operations of the Business. The Business has
not received notice to the effect that its operations are not in compliance with any of the requirements of
applicable federal, state or local environmental or health and safety statutes and regulations or are the
subject of any governmental investigation evaluating whether any remedial action is needed to respond to
a release of any toxic or hazardous waste or substance into the environment, which non-compliance or
remedial action could have a material adverse effect on the financial condition, properties, business or
operations of the Business.
7.16 Effective Date of Representations and Warranties. The warranties and representations of
this Article are made as of the Contract Effective Date and shall be deemed to be renewed and restated by
the Business at the time each request for disbursement of funds is submitted to the IDED.
ARTICLE 8
COVENAN'T'S
8.1 Maintain Existence in Iowa. The Business shall at all times preserve and maintain its
existence as a corporation in good standing and maintain the Project in Iowa. The Business will
preserve and keep in force and affect all licenses, permits, franchises, approvals, patents,
trademarks, trade names, trade styles, copyrights and other proprietary rights necessary to the
proper conduct of its respective business.
8.2 Job Obligations; Benefits Requirements.
Contract #P0806M01729 - 11 - Ntasrerupdated s/o7
(a) Jobs and Wages. By the Project Corrzpletiofz Date, the Business shall create/retain the
number of FTE Created Jobs and Retained Jobs above the Business's E»zploynzeut Base and maintain
the jobs through the Job Mai~ztenance Period, all as detailed in Exhibit D. The Business shall pay the
wage rates identified in Exhibit D.
(b) Benefits. The Business shall provide and pay for the eligible benefits described in Exhibit A,
Business's Financial Assistance Application, with an Average Benefit Value calculated by IDED and
shown in Exhibit D. During the Contract period the Business may adjust the benefit package provided the
Average Benefit Value does not fall below the minimum benefit threshold requirement (e.g., 80% of
medical and dental insurance) for the funding source that is assisting the Project and provided the benefit
package includes eligible benefits.
8.3 Performance Obli atg ions. By the Project Completion Date, Business shall complete the
Project, make the total investment pledged for the Project and in accordance with the Award Budget as
detailed in Exhibit C and comply with all other performance requirements described in this Master
Contract and the Funding Agreements. The Business shall promptly provide IDED with written notice of
any major changes that would impact the success of the Project.
8.4 Maintenance of Properties. The Business shall maintain, preserve and keep its properties in
good repair, working order and condition (ordinary wear and tear excepted) and will from time to time
make all needful and proper repairs, renewals, replacements, additions and betterments thereto so that at
all time the efficiency thereof shall be fully preserved and maintained in accordance with prudent
business practices.
8.5 Taxes and Assessments. The Business shall duly pay and discharge all taxes, rates,
assessments, fees and governmental charges upon or against it against its properties, in each case before
the same become delinquent and before penalties accrue thereon, unless and to the extent that the same
are being contested in good faith and by appropriate proceedings and adequate reserves are provided
therefore.
8.6 Insurance. The Business shall insure and keep insured in good and responsible insurance
companies, all insurable property owned by it which is of a character usually insured by Persons
similarly situated and operating like properties against loss or damage from such hazards or risks as are
insured by Persons similarly situated and operating like properties; and the Business shall insure such
other hazards and risks (including employers' and public liability risks) in good and responsible insurance
companies as and to the extent usually insured by Persons similarly situated and conducting similar
businesses. The Business will upon request of the IDED furnish a certificate setting forth in summary
form the nature and extent of the insurance maintained pursuant to this Article.
8.7 Required Reports.
(a) Review of Disbursement Requests and Reports. The Business shall prepare, sign and submit
disbursement requests and reports as specified in this Master Contract in the form and content required
by IDED. The Business shall review all reimbursement requests and verify that claimed expenditures are
allowable costs. The Business shall maintain documentation adequate to support the claimed costs.
(b) Reports. The Business shall prepare, sign and submit the following reports to the IDED
throughout the Contract period:
Report Due Date
Annual Project Status Re ort
Contract #P0806M01729 - 12 - Master updated s/o~
The Annual Project Status Report will collect July 31St for the period ending June 30th
information from the Business about the status
of the project. This report will collect data such
as current employment levels, number of jobs
that meet or exceed the Qualifying Wage
Threshold Requirements (with and without
benefits), project expenditures, including
amount spent on research and development, any
changes to the Business's benefits, ownership,
structure, or control of the Business and any
other information required by IDED.
End of Project Report
The End of Project Report will collect Within 30 days of Project Completion Date
information from the Business about the
completed project such as final employment
levels, number of jobs that meet or exceed the
Qualifying Wage Threshold Requirements
(with and without benefits), project
expenditures and changes to the Business's
benefits, ownership, structure, or control of the
Business and any other information required by
IDED.
End of Job Maintenance Period Report
The End of Job Maintenance Period Report will Within 30 days of the end of the Job
collect information from the Business's Maintenance Period
continued maintenance of employment levels
and Qualifying Wage Threshold Requirements
(with and without benefits) that were verified at
the Project Completion Date, and changes to the
Business's benefits, ownership, structure, or
control of the Business and any other
information required by IDED.
(c) Additional Reports Financials as Requested by IDED. The IDED reserves the right to
require more frequent submission of any of the above reports if, in the opinion of the IDED, more
frequent submissions would help improve the Business's Project performance, or if necessary in order to
meet requests from the Iowa General Assembly, the Department of Management or the Governor's
office. At the request of IDED, Business shall submit its annual financial statements completed by an
independent CPA, or other financial statements including, but not limited to, income, expense, and
retained earnings statements.
8.8 Inspection and Audit. The Business will permit the IDED and its duly authorized
representatives to visit and inspect any of the Business's properties, corporate books and financial
records of the Business related to the Project, to examine and make copies of the books of accounts and
other financial records of the Business, and to discuss the affairs, finances and accounts of the Business
with, and to be advised as to the same by, its officers, and independent public accountants (and by this
provision the Business authorizes such accountants to discuss with the IDED and the IDED's duly
Contract #P0806M01729 - 13 - Master updated sio7
authorized representatives the finances and affairs of the Business) at such reasonable time and
reasonable intervals as the IDED may designate, but at least annually.
8.9 Compliance with Laws.
(a) The Business will comply in all material respects with the requirements of all federal, state
and local laws, rules, regulations and orders applicable to or pertaining to its properties or business
operations including, but not limited to, all applicable environmental, hazardous waste or substance,
toxic substance and underground storage laws and regulations, and the Business will obtain any permits,
licenses, buildings, improvements, fixtures, equipment or its property required by reason of any
applicable environmental, hazardous waste or substance, toxic substance or underground storage laws or
regulations.
(b) The Business shall comply in all material respects with all applicable federal, state, and local
laws, rules, ordinances, regulations and orders applicable to the prevention of discrimination in
employment, including the administrative rules of the Iowa Department of Management and the Iowa
Civil Rights Commission which pertain to equal employment opportunity and affirmative action.
(c) The Business shall comply in all material respects with all applicable federal, state and local
laws, rules, ordinances, regulations and orders applicable to worker rights and worker safety.
(d) The Business shall comply with IDED's administrative rules for each program funding
source, as identified in the Funding Agreements.
8.10 Use of Award Proceeds. The Business will use the Award proceeds extended under this
Master Contract and the Funding Agreements solely for the purposes set forth in Exhibit C.
8.11 Changes in Business Ownership, Structure and Control. The Business shall not materially
change the ownership, structure, or control of the Business if it would adversely affect the Project. This
includes, but is not limited to, entering into any merger or consolidation with any person, firm or
corporation or permitting substantial distribution, liquidation or other disposal of Business assets directly
associated with the Project. Business shall provide IDED with advance notice of any proposed changes
in ownership, structure or control. The materiality of the change and whether or not the change affects
the Project shall be as reasonably determined by IDED.
8.12 Notice of Meetings_The Business shall notify IDED at least two (2) working days in
advance of all meetings of the board of directors at which the subject matter of this Master Contract, the
Funding Agreements, or the Project is proposed to be discussed. The Business shall provide IDED with
copies if the agenda and minutes of such meetings and expressly agrees that a representative of IDED has
a right to attend those portions of any and all such meetings where the Project, this Master Contract or
the Funding Agreements are discussed.
8.13 Notice of Proceedings. The Business shall promptly notify IDED of the initiation of any
claims, lawsuits, bankruptcy proceedings or other proceedings brought against the Business which would
adversely impact the Project.
8.14 AccountingRecords. The Business is required to maintain its books, records and all other
evidence pertaining to this Master Contract and it Funding Agreements in accordance with generally
accepted accounting principles and such other procedures specified by IDED. These records shall be
available to IDED, its internal or external auditors, the Auditor of the State of Iowa, the Attorney General
of the State of Iowa and the Iowa Division of Criminal Investigations at all times during the Master
Contract's and the Funding Agreements' duration and any extensions thereof, and for three (3) full years
from the Agreement Expiration Date.
Contract #P0806M01729 - 14 - Master updated aio7
8.15 Restrictions. The Business shall not, without prior written disclosure to IDED and prior
written consent of IDED, which shall not be unreasonably withheld, directly or indirectly:
(a) Assign, waive or transfer any of Business's rights, powers, duties or obligations under this
Master Contract or the Funding Agreements.
(b) Sell, transfer, convey, assign, encumber or otherwise dispose of any of the Secured Property
or the Project.
(c) Place or permit any restrictions, covenants or any similar limitations on the Secured Property
or the Project.
(d) Remove from the Project site or the State all or substantially all of the Secured Property.
(e) Create, incur or permit to exist any Lien of any kind on the Secured Property.
8.16 No Changes in Business Operations. The Business shall not materially change the Project
or the nature of the Business and activities being conducted, or proposed to be conducted by Business, as
described in the Business's approved application for funding, Exhibit A of this Master Contract, unless
approved in writing by IDED prior to the change.
8.17 Indemnification. The Business shall indemnify, defend and hold harmless the IDED, the
State of Iowa, its departments, divisions, agencies, sections, commissions, officers, employees and agents
from and against all losses, liabilities, penalties, fines, damages and claims (including taxes), and all
related costs and expenses (including reasonable attorneys' fees and disbursements and costs of
investigation, litigation, settlement, judgments, interest and penalties), arising from or in connection with
any of the following:
a) Any claim, demand, action, citation or legal proceeding arising out of or resulting from the
Project;
b) Any claim, demand, action, citation or legal proceeding arising out of or resulting from a breach
by the Business of any representation or warranty made by the Business in this Master Contract
or the Funding Agreements;
c) Any claim, demand, action, citation or legal proceeding arising out of or related to occurrences
that the Business is required to insure against as provided for in this Master Contract or the
Funding Agreements; and
d) Any claim, demand, action, citation or legal proceeding which results from an act or omission of
the Business or any of their agents in its or their capacity as an employer of a person.
ARTICLE 9
EVENTS OF DEFAULT AND REMEDIES
9.1 Events of Default. Any one or more of the following shall constitute an "Event of Default"
hereunder:
(a) Non~ayynent. In the event of a missed payment under a Loan or in the event a Forgivable
Loan is not forgiven and all or a portion of the Forgivable Loan must be repaid by the Business, a default
in the payment when due (whether by lapse of time, acceleration or otherwise) of any principal on the
Promissory Note(s), or default in payment for more than ten (10) Business Days of the due date thereof
of any interest on the Promissory Note(s) or any fee or other obligation payable by the Business shall be
an Event of Default; or
Contract #P0806M01729 - 15 - Master updated s~o7
(b) Noncompliance with Covenants. Default in the observance or performance of any covenant
set forth in Article 8, for more than five (5) Business Days; or
(c) Noncompliance with Security Documents. Default in the observance or performance of any
term of any Security Documents beyond any applicable grace period set forth therein; or
(d) Noncompliance with Master Contract. Default in the observance or performance of any other
provision of this Master Contract; or
(e) Noncompliance with FzmdingA~,reements; Cross-Default. Default in the observance or
performance of any other provision of any of the Funding Agreements, including Events of Default
identified in any of the Funding Agreements; IDED may elect to declare the Business in default of this
Master Contract and any or all of the Funding Agreements if there is a default under any one of the
Funding Agreements; or
(f) Material Misrepresentation. Any representation or warranty made by the Business in this
Master Contract or the Funding Agreements or in any statement or certificate furnished by it pursuant to
this Master Contract or the Funding Agreements, or made in its Financial Assistance Application, or in
connection with any of the above, proves untrue in any material respect as of the date of the issuance or
making thereof; or
(g) Lien. De zciencies. Any of the Security Documents shall for any reason fail to create a valid
and perfected priority Lien in favor of the IDED in any Secured Property pledged by Business; or
(h) Judgment Over $100, 000. Any judgment or judgments, writ or writs or warrant or warrants of
attachment, or any similar process or processes in an aggregate amount in excess of $100,000 shall be
entered or filed against the Business or against any of its property and remains unvacated, unbonded or
unstayed for a period of 30 days; or
(i) Adverse Change in Financial Condition. Any change shall occur in the financial condition of
the Business which would have a material adverse effect on the ability of the Business to perform under
this Master Contract or the Funding Agreements; or
(j) Bankruptcy or Similar Proceedings Initiated. Either the Business shall (1) have entered
involuntarily against it an order for relief under the United States Bankruptcy Code, as amended, (2) not
pay, or admit in writing its inability to pay, its debts generally as they become due, (3) make an
assignment for the benefit of creditors, (4) apply for, seek, consent to, or acquiesce in, the appointment of
a receiver, custodian, trustee, examiner, liquidator or similar official for it or any substantial part of its
Property, (5) institute any proceeding seeking to have entered against it an order for relief under the
United States Bankruptcy Code as amended, to adjudicate it insolvent, or seeking dissolution, winding
up, liquidation, reorganization, arrangement, adjustment or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors or fail to file an answer or other
pleading denying the material allegations of any such proceeding filed against it, or (6) fail to contest in
good faith any appointments or proceeding described in Article 9.1(k) below; or
(k) ~pointrrzent of Officials. A custodian, receiver, trustee, examiner, liquidator or similar
official shall be appointed for either the Business or any substantial part of any of its respective property,
or a proceeding described in Article 9.1(j) shall be instituted against either the Business and such
appointment continues undischarged or such proceeding continues undismissed or unstayed for a period
of sixty (60) days; or
(1) Insecurity. IDED shall in good faith deem itself insecure and reasonably believes, after
Contract #P0806M01729 - 16 - Masterupdated sio7
consideration of all the facts and circumstances then existing, that the prospect of payment and
satisfaction of the obligations under this Master Contract and/or the Funding Agreements, or the
performance of or observance of the covenants in this Master Contract and/or the Funding Agreements, is
or will be materially impaired.
(m) Failure to Submit Required Reports. The Business fails to submit complete reports by the
required due dates as outlined in Article 8.7.
(n) Layoffs, Relocation, or Closure. The Business experiences a layoff within the state or closes
any of its facilities within the state during the term of this Contract.
9.2 Default Remedies. When an Event of Default has occurred and is continuing, the IDED
may, by written notice to the Business:
(a) terminate this Master Contract, the Funding Agreements and all of the obligations of IDED
under this Master Contract and the Funding Agreements on the date stated in such notice, and
(b) declare the principal and any accrued interest on the outstanding Promissory Notes to be
forthwith due and payable, including both principal and interest and all fees, charges and other amounts
payable under this Master Contract and the Funding Agreements, shall be and become immediately due
and payable without further demand, presentment, protest or notice of any kind.
9.3 Default Interest Rate. If an Event of Default occurs and remains uncured, a default rate of
6% shall apply to repayment of amounts due under this Master Contract and the Funding Agreements.
The default interest rate shall accrue from the first date Award funds are disbursed.
9.4 Expenses. The Business agrees to pay to the IDED all expenses reasonably incurred or paid
by IDED including reasonable attorneys' fees and court costs, in connection with any Default or Event of
Default by the Business or in connection with the enforcement of any of the terms of this Master
Contract and the Funding Agreements.
9.5 Notice of Default and Opportunity to Cure. If IDED has reasonable cause to believe that an
Event of Default has occurred under this Master Contract and/or the Funding Agreements, IDED shall
issue a written Notice of Default to the Business, setting forth the nature of the alleged default in
reasonable specificity, and providing therein a reasonable period time, which shall not be fewer than
thirty (30) days from the date of the Notice of Default, in which the Business shall have an opportunity to
cure, provided that cure is possible and feasible.
ARTICLE 10
MISCELLANEOUS.
10.1 Timely Performance. The parties agree that the dates and time periods specified in this
Master Contract and the Funding Agreements, including the timelines established for the Project and
more fully described in Exhibit C, are of the essence to the satisfactory performance of this Master
Contract and the Funding Agreements.
10.2 State of Iowa Reco inf. If the Project involves construction and there is signage
recognizing the financial contributions made to the Project the Business agrees to include the Iowa
Department of Economic Development on the list of entities providing assistance.. For example, a sign
or plaque indicating that the Project was funded in part by an Award from the State of Iowa, Iowa
Department of Economic Development.
Contract #P0806M01729 - 17 - nnasterupdated sio7
10.3 Choice of Law and Forum.
(a) In the event any proceeding of a quasi judicial or judicial nature is commenced in connection
with this Master Contract or the Funding Agreements, the proceeding shall be brought in Des Moines,
Iowa, in Polk County District Court for the State of Iowa, if such court has jurisdiction. If however, such
court lacks jurisdiction and jurisdiction lies only in a United States District Court, the matter shall be
commenced in the United States District Court for the Southern District of Iowa, Central Division.
(b) This provision shall not be construed as waiving any immunity to suit or liability, in state or
federal court, which maybe available to the IDED, the State of Iowa or its members, officers, employees
or agents.
10.4 Governing Law. This Master Contract and the Funding Agreements and the rights and
duties of the parties hereto shall be governed by, and construed in accordance with the internal laws of
the State of Iowa without regard to principles of conflicts of laws.
10.5 Master Contract/Funding Agreement Amendments. Neither this Master Contract nor any
documents incorporated by reference in connection with this Master Contract, including the Funding
Agreements, maybe changed, waived, discharged or terminated orally, but only as provided below:
(a) Writing required. The Master Contract and the Funding Agreements may only be amended if
done so in writing and signed by the Business and IDED; and for those Funding Agreements in which the
Community is a signatory, by the Community, the Business and IDED. Examples of situations requiring
an amendment include, but are not limited to, time extensions, budget revisions, and significant
alterations of existing activities or beneficiaries. No amendment will be valid until approved in writing
by IDED.
(b) IDED review. IDED will consider whether an amendment request is so substantial as to
necessitate reevaluating the IDED's or IDED Board's original funding decision. An amendment maybe
denied by IDED if it substantially alters the circumstances under which the Project funding was
originally approved.
10.6 Notices. Except as otherwise specified herein, all notices hereunder shall be in writing
(including, without limitation by fax) and shall be given to the relevant party at its address, e-mail
address, or fax number set forth below, or such other address, e-mail address, or fax number as such party
may hereafter specify by notice to the other given by United States mail, by fax or by other
telecommunication device capable of creating a written record of such notice and its receipt. Notices
hereunder shall be addressed:
To the Business:
Dubuque Stamping & Manufacturing, Inc.
David W. Spahn, President
3190 Jackson Street
Dubuque, IA 52001
E-mail: dave@dbgstamp.com
Telephone : 5 63 -5 8 3 -5 716
Facsimile : 5 63 -5 5 6-8729
To the IDED at:
Iowa Department of Economic Development
Contract #P0806M01729 - 18 - Master updatedaio~
Legal and Compliance
200 East Grand Avenue
Des Moines, Iowa 50309
Attention: Sabrina Johnson, Project Manager
E-mail: Sabrina.johnson@iowalifechanging.com
Telephone: 515/ 242-4944
Facsimile: 515/ 242-4832
Each such notice, request or other communication shall be effective (i) if given by facsimile, when such
facsimile is transmitted to the facsimile number specified in this Article and a confirmation of such
facsimile has been received by the sender, (ii) if given by e-mail, when such e-mail is transmitted to the
e-mail address specified in this Article and a confirmation of such e-mail has been received by the
sender, (iii) if given by mail, five (5) days after such communication is deposited in the mail, certified or
registered with return receipt requested, addressed as aforesaid or (iv) if given by any other means, when
delivered at the addresses specified in this Article.
10.7 Headings. Article headings used in this Master Contract and the Funding Agreements are
for convenience of reference only and are not a part of this Master Contract or the Funding Agreements
for any other purpose.
10.8 Final Authority. The IDED shall have the authority to reasonably assess whether the
Business has complied with the terms of this Master Contract and the Funding Agreements. Any IDED
determinations with respect to compliance with the provisions of this Master Contract and the Funding
Agreements shall be deemed to be final determinations pursuant to Section 17A of the Code of Iowa
(2007).
10.9 Waivers. No waiver by IDED of any default hereunder shall operate as a waiver of any
other default or of the same default on any future occasion. No delay on the part of the IDED in
exercising any right or remedy hereunder or under the Funding Agreements shall operate as a waiver
thereof. No single or partial exercise of any right or remedy by IDED shall preclude future exercise
thereof or the exercise of any other right or remedy.
10.10 Counterparts. This Master Contract maybe executed in any number of counterparts, each
of which shall be deemed to be an original, but all of which together shall constitute but one and the same
instrument.
10.11 Survival of Representations. All representations and warranties made herein or in any other
Master Contract/Funding Agreement document or in certificates given pursuant hereto or thereto shall
survive the execution and delivery of this Master Contract and the Funding Agreements and the other
Master Contract/Funding Agreement documents and shall continue in full force and effect with respect to
the date as of which they were made until all of Business's obligations or liabilities under this Master
Contract and the Funding Agreements have been satisfied.
10.12 Severability of Provisions. Any provision of this Master Contract or the Funding
Agreements, which is unenforceable in any jurisdiction, shall, as to such jurisdiction, be ineffective to the
extent of such unenforceability without invalidating the remaining provisions hereof or affecting the
validity or enforceability of such provision in any other jurisdiction. All rights, remedies and powers
provided in this Master Contract and or the Funding Agreements or any other Master Contract document
maybe exercised only to the extent that the exercise thereof does not violate any applicable mandatory
Contract #P0806M01729 - 19 - Masrerupdared sio~
provisions of law, and all the provisions of this Master Contract and the Funding Agreements and any
other Master Contract document are intended to be subject to all applicable mandatory provisions of law
which maybe controlling and to be limited to the extent necessary so that they will not render this Master
Contract or the Funding Agreements or any other Master Contract document invalid or unenforceable.
10.13 Successors and Assigns. This Master Contract and the Funding Agreements shall be
binding upon the Business and its respective successors and assigns, and shall inure to the benefit of the
IDED and the benefit of their respective successors and assigns. The Business may not assign its rights
hereunder or under any of the Funding Agreements without the written consent of the IDED, which
consent will not be unreasonably withheld.
10.14 Termination. This Master Contract and any of the Funding Agreements can be terminated
upon mutual, written agreement of the Business and IDED and, for Funding Agreements to which the
Community is a signatory, upon mutual written agreement of the Business, IDED and the Community.
10.15 Irate agr tion. This Master Contract and the Funding Agreements contains the entire
understanding between the Business and IDED relating to the Project and any representations that may
have been made before or after the signing of this Master Contract and the Funding Agreements, which
are not contained herein, are nonbinding, void and of no effect. None of the Parties have relied on any
such prior representation in entering into this Master Contract and its Funding Agreement.
IN WITNESS WHEREOF in consideration of the mutual covenants set forth above and for other
good and valuable consideration, the receipt, adequacy and legal sufficiency of which are hereby
acknowledged, the parties have entered into this Master Contract and have caused their duly authorized
representatives to execute this Master Contract, effective as of the latest date stated below (the
"Contract Effective Date").
FOR THE IOV6'A DEPARTMENT OF ECONOMIC DEVELOPMENT:
BY:
Michael L. Tramontina, Director
Date
FORT INESS:
BY:
Si nature
David W. Spahn - President
Typed Name and Title
January 23, 2009
Date
Contract #P0806M01729 - 20 - Master updated sio7
LIST OF EXHIBITS
Exhibit A -
Exhibit B -
Exhibit C -
Business's Financial Assistance Application (on Ele with IDED),
Application #08-EZ-034
Funding Agreements
B4-EZ Funding Agreement
Description of the Project and Award Budget
Exhibit D - Job Obligations
Contract #P0806M01729 - 21 - Master updated s/o7
EXIIIBIT B - 4
EZ FUNDING AGREEMENT
BUSINESS:
COMMUNITY:
MASTER CONTRACT NUMBER:
FUNDING AGREEMENT NUMBER:
ENTERPRISE ZONE NAME:
ZONE CERTIFICATION DATE:
ZONE EXPIRATION DATE:
Dubuque Stamping & Manufacturing, Inc.
City of Dubuque
P0806M01729
08-EZ-034
Dubuque EZ-2B
November 15 1997
November 15, 2017 (Extended)
THIS ENTERPRISE ZONE (EZ) FUNDING AGREEMENT is made by and among the
IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT, 200 East Grand Avenue, Des Moines,
Iowa 50309 ("IDED"), the business identified above ("Business"), and the community identified
above ("Community"), effective as of the Contract Effective Date stated in the Master Contract
identified above.
WHEREAS, the purpose of the EZ Program is to promote new economic development in
economically distressed areas; and
WHEREAS, the Community has designated and IDED has certified the Enterprise Zone
identified above; and
WHEREAS, eligible businesses locating or located in an Enterprise Zone are authorized
under this program to receive certain tax incentives and assistance and the Business has
located, or will locate, within the certified Enterprise Zone; and
WHEREAS, the Enterprise Zone Commission responsible for the above-identified Zone
has recommended approval and IDED has found the Business' application to be consistent with
the EZ Program's eligibility requirements; and
WHEREAS, the Business has executed the Master Contract described above with the
IDED pursuant to an Award on the Award Date stated in the Master Contract to the Business for
the Project; and
WHEREAS, the Master Contract specifies that for each program funding source the
IDED and the Business shall enter into a Funding Agreement; and
WHEREAS, this EZ Funding Agreement contains additional terms and conditions for the
award of EZ benefits and
NOW, THEREFORE, the Business and Community accept the terms and conditions set
forth in this EZ Funding Agreement and the Master Contract for the funding of the Project. In
consideration of the mutual promises contained in the Master Contract and this EZ Funding
Agreement and other good and valuable consideration, it is agreed as follows:
1.0 Master Contract. Unless otherwise specified in this EZ Funding Agreement, the
definitions, terms, conditions, and provisions contained in the Master Contract are applicable to
this EZ Funding Agreement. The following provisions in the Master Contract do not apply to this
EZ Funding Agreement:
Article 3.1(b) -Definition of "Project Completion Date" and "Job Maintenance Period." [The EZ
program has different time periods for these activities.]
Article 4.3 -Repayment obligation. [No promissory note required for tax credits.]
Article 5.1(c) -Promissory Notes. [Execution of note is not a condition precedent to receipt of
tax credit benefits]
Article 5.1(g) -Security Documents. [Execution of Security Documents is not a condition
precedent to receipt of tax credit benefits].
Article 5.1(m) -Requests for disbursement. [Not required for tax credit program benefits.]
Article 5.2 -Prior costs. [Not applicable to tax credit program benefits.]
Article 5.3 -Cost variation. [Not applicable to tax credit program benefits.]
Article 5.5-Investment of Award Proceeds. [No proceeds in tax credit programs.]
Article 6 -Security, Cross-collateralization.. [Not applicable to tax credit program benefits.]
Article 9.1(a) -Nonpayment as an Event of Default. [Not applicable because there are no loan
payments in tax credit programs].
Article 9.1(c) -Noncompliance with Security Documents as an Event of Default. [Not applicable
because there are no Security Documents required in tax credit programs].
Article 9.1(g) -Lien Deficiencies as an Event of Default. [Not applicable because there are no
Security Documents required in tax credit programs.]
2.0 Definitions. As used in this EZ Funding Agreement, the following terms shall apply:
2.1 Agreement Expiration Date. Expiration of this EZ Funding Agreement occurs upon
the happening of one of the following events, whichever occurs first:
(a) IDED's determination that the Business has fully met the requirements of the EZ
Funding Agreement, including meeting its Job Obligations, and IDED closes out this
EZ Funding Agreement.
(b) An Event of Default occurs that is not remedied within the time period allowed
under Article 5.0 of this EZ Funding Agreement.
(c) This EZ Funding Agreement is terminated upon mutual, written agreement of
the Business, the Community and IDED.
2.2 EZ Program. "EZ Program" means the Enterprise Zone Program. The EZ Program
is authorized by Iowa Code (2007) sections 15E.191 through 15E.196.
Master Contract #P0806M01729
Funding Agreement #08-EZ-034 - 2 - Revised sio~
2.3 EZ Award. "EZ Award" means IDED's approval of the Business's Financial
Assistance Application for the Project. This EZ Award authorizes the Business to receive EZ
Program benefits.
2.4 "Annual Base Rent". "Annual Base Rent" means the Business' annual lease
payment minus taxes, insurance, and operating or maintenance expenses.
2.5 "Commission" or "Enterprise Zone Commission" or "Enterprise Zone Commission"
means the Enterprise Zone commission established by the Community responsible for the
certified Enterprise Zone.
2.6 "Enterprise Zone." "Enterprise Zone" means the site within the Community certified
by the IDED Board for the purpose of attracting private investment.
2.7 Protect Completion Date. "Project Completion Date", for purposes of reporting to
the Iowa Department of Revenue that the Project has been completed, means: (1) the first date
upon which the average annualized production of finished product for the preceding ninety-day
period at the manufacturing facility operated by the Business within the Enterprise Zone is at
least fifty percent of the initial design capacity of the facility; or (2) for existing or non-
manufacturing facilities, the date of completion of all improvements included in the Project.
3.0 Enterprise Zone Benefits.
3.1 Benefits Available. The following Enterprise Zone benefits are available to the
Business under this EZ Funding Agreement:
(a) Supplemental New Jobs Credit. As provided in Iowa Code section 15.331, the
Business is eligible to claim a supplemental new jobs credit from withholding in an amount equal
to 1 ~/z percent of the gross wages paid by the Business. The supplemental new jobs credit
available under this program is in addition to and not in lieu of the program and withholding
credit of 1'/z percent authorized under Iowa Code chapter 260E.
Additional new jobs created by the project, beyond those that were agreed to in Article 4
of this Agreement, are eligible for the additional 1 '/ percent withholding credit as long as those
additional jobs meet the local Enterprise Zone wage eligibility criteria and are an integral part or
a continuation of the Project. Approval and administration of the supplemental new jobs credit
shall follow existing procedures established under Iowa Code chapter 260E.
(b) Investment Tax Credit.
(i) The Business may claim an investment tax credit as provided in Iowa
Code section 15.333. An investment tax credit may be claimed of up to a
maximum of ten percent (10%) of the new investment which is directly
related to the Project Jobs created by the location or expansion of the
Business in the Enterprise Zone. The Business may not claim an investment
tax credit for capital expenditures above the amount stated in Article 4.2 of
this EZ Funding Agreement. The credit is to be taken in the year the
Master Contract #P0806M01729
Funding Agreement #08-EZ-034 - 3 - Revised aio~
qualifying asset is placed in service. Any credit in excess of the tax liability
for the tax year may be credited to the tax liability for the following seven
years or until depleted, whichever occurs earlier.
(ii) The tax credit shall be amortized equally over afive-year period which the
department will, in consultation with the eligible business, define. The five-
yearamortization period is specified below:
Amortization Schedule
Jul 1, 2007 -June 30, 2008 $46,480
Jul 1, 2008 -June 30, 2009 $46,480
July 1, 2009 -June 30, 2010 $46,480
Jul 1, 2010 -June 30, 2011 $46,480
July 1, 2011 -June 30, 2012 $46,480
(iii) EZ Funding Agreement Exhibit C, "Investment Tax Credit Amortization
Schedule Examples," illustrates how the 5-year amortization requirement will be
applied.
(iv) The capital expenditures eligible for the investment tax credit are:
1. The purchase price of real property and any existing buildings and
structures located on the real property.
2. The cost of improvements made to real property which is used in
operation of the Business.
3. The costs of manufacturing machinery and equipment and computers,
as defined in Iowa Code section 427A.1(1) "e" and "j," which are
purchased for use in the operation of the Business and which the
purchase price have been depreciated in accordance with generally
accepted accounting principles.
4. Ten (10) years of Annual Base Rent payments provided the cumulative
cost of these payments does not exceed the cost of the land and the
third-party developer's costs to build or renovate the building. Annual
base rent shall only be considered when the project includes the
construction of a new building or the major renovation of an existing
building.
(c) Additional Research Activities Credit. The Business is eligible to claim an
additional research activities credit as provided in Iowa Code section 15.335. This benefit is a
tax credit for increasing research activities in this state during the period the Business is
participating in the program. For purposes of claiming this credit, a business is considered to be
"participating in the program" for a period of ten (10) years from the Award Date. The credit may
equal up to six and one-half percent (6.5%) of the State's apportioned share of the qualifying
expenditures for increasing research activities and is in addition to the credit authorized in Iowa
Code sections 422.10 and 422.33(5). Any tax credit in excess of the tax liability may be
refunded to the Business with interest or, at its election, credited to its tax liability the following
year.
"Research activities" includes the development and deployment of innovative renewable
energy generation components manufactured or assembled in Iowa. A renewable energy
Master Contract #P0806M01729
Funding Agreement #08-EZ-034 - 4 - Revised aio~
generation component will no longer be considered innovative when more than 200 megawatts
of installed effective nameplate capacity has been achieved. Research activities credits
awarded under this program and the high quality job creation program for innovative renewable
energy generation components shall not exceed a total of $1 million.
(d) Refund Of Sales Service And Use Taxes Paid To Contractors Or
Subcontractors. The Business is eligible for a refund of sales, service and use taxes paid to
contractors and subcontractors as authorized in Iowa Code section 15.331A.
(i) The Business may apply for a refund of the sales and use taxes paid under Iowa
Code chapters 422 and 423 for gas, electricity, water or sewer utility services,
goods, wares, or merchandise, or on services rendered, furnished, or performed
to or for a contractor or subcontractor and used in the fulfillment of a written
contract relating to the construction or equipping of a facility within the Enterprise
Zone.
(ii) Taxes attributable to intangible property and furniture and furnishings shall not be
refunded.
To receive a refund of the sales, service and use taxes paid to contractors or
subcontractors, the Business must, within one year after Project Completion, make an
application to the Department of Revenue.
3.2 Duration Of Benefits. The Enterprise Zone designation shall remain in effect for
ten years following the date of certification. Any state or local incentives or assistance that may
be conferred must be conferred before the designation expires. However, the benefits of the
incentive or assistance may continue beyond the expiration of the Enterprise Zone designation.
3.3 Benefits Not Available. The following Enterprise Zone benefits are not available
to the Business under this agreement:
Value-Added Property Tax Exemption
Refund of Taxes Attributable to Racks, Shelving, and Conveyor Equipment
4.0 Conditions to Receipt of Enterprise Zone Benefits.
The Enterprise Zone Benefits authorized under this EZ Funding Agreement are available to the
Business provided the Business, (and where applicable, the Community) satisfies each of the
following conditions:
4.1 Job Obli atc~ ions. The Business's Job Obligations are as detailed in Master
Contract Exhibit D, "Job Obligations." The Business shall create the required number of jobs
that pay the Qualifying Wage within 3 years (the "Job Creation Perioai°') of the Award Date.
The Business shall maintain the Created Jobs in addition to the Business's Base Employment
for a period of at least ten (10) years (the "Job Maintenance Period ") beyond the Job Creation
Period for a total contract duration of 13 years.
4.2 Investment. Within three (3) years of the Award Date (as defined in the Master
Agreement), the Business shall make a capital investment of $2,905,000 within the Enterprise
Zone, as defined in 3.1(b).
Master Contract #P0806M01729
Funding Agreement #08-EZ-034 - 5 - Revised aio~
4.3 Medical and Dental Insurance. The Business provides all full-time employees
with the option of choosing one of the following:
(a) The Business pays 80 percent of both of the following:
(i) the cost of a standard medical insurance plan, and
(ii) the cost of a standard dental insurance plan or an equivalent plan;
(b) The Business provides the employee with a monetarily equivalent plan to the plan
provided in "a."
4.4 Business Retention. The Business shall have and maintain Project operations
contemplated by this Agreement within the Community at least through the Agreement
Expiration Date.
4.5 Local Commitment. The Community shall provide the local financial assistance for
the Project as described in Exhibit C, Project Description.
5.0 Events of Default by the Business; Notice of Default; Repayment Provisions.
5.1 Events of Default. The terms of Article 9.0 (Events of Default) of the Master Contract
govern this EZ Funding Agreement, except as noted in Article 5.2 and 5.3 below.
5.2 Notice of Default. The following Notice of Default provisions supersede the Notice of
Default and repayment provisions specified Article 9.2(Notice of Default and Opportunity to
Cure) in the Master Contract:
(a) From Department. If, through the Annual Project Status Report , or other means,
the IDED has reason to believe the Business is in default of the terms of this Agreement, the
IDED will issue a written Notice of Default to the Business, setting forth the nature of the default
in reasonable specificity, and providing therein a reasonable period of time, which shall not be
less than 30 days from the date of the Notice of Default, in which the Business shall have an
opportunity to cure, provided that cure is possible and feasible. A copy of any Notice of Default
will also be provided to the Community and Department of Revenue.
(b) From Community. If, through monitoring, auditing or other means, the
Community has reason to believe the Business is in default of the terms of this Agreement, the
Community will issue a written Notice of Default to the Business, setting forth the nature of the
default in reasonable specificity, and providing therein a reasonable period of time, which shall
not be less than 30 days from the date of the Notice of Default, in which the Business shall have
an opportunity to cure, provided that cure is possible and feasible. A copy of any Notice of
Default will also be provided to the IDED and Department of Revenue.
5.3 Repayment Provisions. The following provisions supersede the provisions of Article
9.2 (Default Remedies) of the Master Contract. If the Business has received incentives or
assistance under the EZ Program and fails to meet and maintain any one of the requirements of
the EZ Program (as stated in Iowa Code section 15E.193 to be an eligible business), or fails to
comply with the EZ Program Administrative Rules (261 IAC chapter 59) or fails to meet any term
of this EZ Funding Agreement, the Business is subject to repayment of all or a portion of the
incentives and assistance that it has received, as detailed below:
Master Contract #P0806M01729
Funding Agreement #08-EZ-034 - 6 - Revised sio~
(a) Job Obligations at Project Completion Date and Job Maintenance Period. If the
Business does not meet its Job Obligations by the Project Completion Date or fails to maintain
its Job Obligations through the Job Maintenance Period, both as defined in Master Contract
Exhibit D, the Business shall repay a percentage of tax incentives and assistance it has
received. Repayment shall be calculated as follows:
(i) If the Business has met 50 percent or less of the requirement, the
Business shall repay the same percentage in benefits as the Business
failed to create in jobs.
(ii) If the Business has met more than 50 percent but not more than 75
percent of the requirement, the Business shall repay one-half of the
percentage in benefits as the Business failed to create in jobs.
(iii) If the Business has met more than 75 percent but not more than 90
percent of the requirement, the Business shall repay one-quarter of the
percentage in benefits as the Business failed to create in jobs.
(iv) If the Business has not met the minimum job creation requirement of ten
(10) new full-time jobs, the Business shall repay all of the incentives and
assistance that it has received.
(b) Wailes and benefits. If the Business fails to comply with the wage or benefit
requirements, the Business shall not receive Enterprise Zone benefits for each year during
which the Business is not in compliance.
(c) Capital Investment. If the Business does not meet the capital investment
requirement described in 4.2, repayment shall be calculated as follows:
(i) If the Business has met 50 percent or less of the requirement, the
Business shall repay the same percentage in benefits as the Business
failed to invest.
(ii) If the Business has met more than 50 percent but not more than 75
percent of the requirement, the Business shall repay one-half of the
percentage in benefits as the Business failed to invest.
(iii) If the Business has met more than 75 percent but not more than 90
percent of the requirement, the Business shall repay one-quarter of the
percentage in benefits as the Business failed to invest.
(iv) If the Business has not met the minimum investment requirement of
$500,000, the Business shall repay all of the incentives and assistance
that it has received.
(d) Department of Revenue; Community Recovery. Once it has been established,
through the Business' annual certification, monitoring, audit or otherwise, that the Business
is required to repay all or a portion of the incentives received, the Department of Revenue
and the Community shall collect the amount owed. The Community has the authority,
pursuant to the EZ Program, to take action to recover the value of taxes not collected as a
result of the exemption provided by the Community to the Business. Department of Revenue
has the authority, pursuant to the EZ Program, to recover the value of state taxes or
incentives provided under the EZ Program. The value of state incentives provided under the
EZ Program includes applicable interest and penalties.
Master Contract #P0806M01729
Funding Agreement #08-EZ-034 - 7 - Revised eio~
(e) Layoffs or closures. If the Business experiences a layoff within the state or
closes any of its facilities within the state prior to receiving the tax incentives and assistance,
the Department may reduce or eliminate all or a portion of the tax incentives and assistance.
If an approved Business experiences a layoff within the state or closes any of its facilities
within the state after receiving tax incentives and assistance, the Business may be subject
to repayment of all or a portion of the tax incentives and assistance that it has received.
6.0 Event of Default by Community.
6.1 Event of Default. The Community's failure to provide the local financial assistance
pledged for the Project as described in Master Contract Exhibit C, Project Description and
Award Budget.
6.2 Notice of Default and Opportunity to Cure. If the IDED has reason to believe the
Community is in default of the terms of this Agreement, the IDED will issue a written notice of
default to the Community setting forth the nature of the default in reasonable specificity, and
providing therein a reasonable period of time, which shall not be less than 30 days from the date
of the Notice of Default, in which the Community shall have an opportunity to cure, provided that
cure is possible and feasible. A copy of any Notice of Default will also be provided to the
Business and Department of Revenue.
6.3. Repayment by Community. If an Event of Default is not cured within the time
allowed, IDED's remedies include but are not limited to legal action against the Community for
payment of the amount of local financial assistance pledged but not provided by the Community
plus 6% default interest calculated from the Award Date.
7.0 Incorporated documents. The following documents are hereby incorporated by this
reference:
1. The Master Contract and its Exhibits.
2. EZ Funding Agreement Exhibit A, "Enterprise Zone Commission Resolution
Approving the Business's Enterprise Zone Application."
3. EZ Funding Agreement Exhibit C, "Investment Tax Credit Amortization Schedule
Examples."
This section left blank intentionally ----Signature page follows
Master Contract #P0806M01729
Funding Agreement #08-EZ-034 - 8 - Revised sio~
IN WITNESS WHEREOF, the parties have executed this EZ Funding Agreement:
FOR THE BUSINESS:
~ `~. ~ _
BY:
Signature
David W. Spahn - President
Typed Name and Title
January 23, 2009
Date
FOR THE IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT:
BY:
Michael L. Tramontina, Director
Date
FOR THE COMMUNITY:
BY:
Signature
Typed Name and Title
Date
Master Contract #P0806M01729
Funding Agreement #08-EZ-034 - 9 - Revised sio~
EZ Funding Agreement Exhibit A
Enterprise Zone Commission Resolution
Approving the Business's Enterprise Zone Application
CI U U U ,I
T I 1 1
R SOLUTION ®2008
A RESOLUTION APPROVING TH FILING F AN APPLICATION WITH THE
IOWA DEPA T T OF CNOIC DVLOP T REQUESTING
ENTERPRISE ON BENEFITS ON BEHALF OF DUBUQUE STAMPING
MANUFACTURING, INC.
Whereas, the State of Iowa Department of Economic Development (IDED) is
accepting applications from eligible businesses pursuant to the authority of House File
724, Enterprise Zone Legislation; and
Whereas, the City of Dubuque, Iowa has two certified Enterprise Zones; and
Whereas, the City's Enterprise Zone Commission has been created by City
Ordinance to review applications for tax incentives and assistance based on criteria
specified by law and to transmit its recommendation to the IDED; and
Whereas, the City's Enterprise Zone Commission has reviewed an application
from Dubuque Stamping & Manufacturing, Inc. and has found the proposed project
eligible to apply for Enterprise Zone benefits.
NOW, THEREFORE, BE IT RESOLVED BY THE ENTERPRISE ZONE
COMMISSION OF THE CITY OF DUBUQUE, IOWA:
Section 1. That the Dubuque Stamping & Manufacturing, Inca application for
Enterprise Zone benefits is approved.
Section 2. That Dubuque Stamping & Manufacturing, Inc. will create
seventeen (17) new jobs at their Jackson Street facility.
Section 3. That Dubuque Stamping & Manufacturing, Inc. will invest
approximately $3,130,000 in Enterprise Zone 2 as part of the expansion project.
Section 3. That the Chairperson is hereby authorized and directed to execute,
on behalf of the Enterprise Zone Commission, the joint application for Enterprise Zone
benefits.
Passed, approved and adopted this 15t" day of May, 2008.
C~
' Kelley Deut eyer
Acting Chair
F:\USERSWdejong\Enterprise Zone\Dubuque Stamping\DBQ Stamp EZ resolution.doc
EZ Funding Agreement Exhibit C
Investment Tax Credit Amortization Schedule Examples
EZ Funding Agreerv~ent
Exhibit C
investment Tax Credit Amortization Schedule Examples
Background Information:
Effective July 1, 2005, Investment Tax Credits (or Insurance Premium Tax Credits) awarded to a Business by the
Iowa Department of Economic Development must be amortized equally over a 5-year period. The Department will
determine the amortization schedule and include it in the Business' funding agreement.
Please note Investment Tax Credits (or Insurance Premium Tax Credits) are ea~~ned when the corresponding asset
(e.g, the building, a piece of machinery & equipment, etc.) is placed in service. "Placed in service" typically
corresponds with the point in time when the Business can start depreciating the asset for tax purposes.
Earned Investment Tax Credits (or Insurance Premium Tax Credits) which cannot be used because of the
amortization schedule or because the credits exceed the Business' tax liability for that tax year may be carried
forward for up to seven additional tax years.
Example #1
In this example, the Business is eligible to receive an Investment Tax Credit (ITC) in the amount of $100,000. The
ITC is earned on December l5, 2005 and may be carried forward until the tax year in which December l 5, 2012
falls. The Business' ITC amortization schedule follows:
Fiscal Year 2007 -July l , 2006 -June 30, 2007 $20,000
Fiscal Year 2008 -July 1, 2007 -June 30, 2008 $20,000
Fiscal Year 2009 -July 1, 2008 -June 30, 2009 $20,000
Fiscal Year 2010 -July 1, 2009 -June 30, 2010 $20,000
Fiscal Year 2011 -July 1, 2010 -June 30, 2011 $20,000
As the ITC was earned in the first year, the Business may claim up to $20,000 on its tax return for that tax year. The
Business' tax liability for that tax year is $15,000 therefore; the Business will carry forward $5,000 of unused
credits.
ITC Earned -Total
$100,000
ITC Available to be Taken based on the Amortization Schedule $20,000 (FY 2006)
Less ITC Claimed on Cun•ent Year's Tax Return $15 000
ITC to be Cai•rred Fo~~~ard into Future Tax Year $ 5,000
The following year the Business may claim up to $25,000 in ITCs on its tax return; $5,000 being carried forward
from last year plus another $20,000 based on the amortization schedule. The Business' tax liability for the current
tax year is $25,000.
ITC Earned -Total $100,000
Less ITC Claimed to Date $ l 5 000
ITC Remaining -Total $ 85,000
ITC Available to be Taken based on the Amortization Schedule $20,000 (FY 2007)
Plays ITC Carried Forward from Previous Year $ 5,000
Less ITC Claimed on Current Year's Tax Return $25 000
ITC to be Caa°ried Foa•ivard into Future Tax Year $ 0
September 14, 2005
The Business would be able to continue to take tax credits based on the amortization schedule and its tax liability
each year. If this example were to continue, the tax credits could continue to be claimed until they are exhausted or
until the carry forward period expires in the tax year in which December 15, 2012 falls.
Example #2
In this example, the Business is eligible to receive an Investment Tax Credit (ITC) in the amount of $500,000. The
ITC is earned on February 15, 2008 and may be carried forward until the tax year in which February 15, 2015 falls.
The Business' ITC amortization schedule follows:
Fiscal Year 2007 -July 1, 2006 - June 30, 2007 $100,000
Fiscal Year 2008 -July 1, 2007 - June 30, 2008 $100,000
Fiscal Year 2009 -July 1, 2008 - June 30, 2009 $100,000
Fiscal Year 2010 -July 1, 2009 - June 30, 2010 $100,000
Fiscal Year 2011 -July 1, 2010 - June 30, 2011 $100,000
As the ITC was earned in the third year of the amortization schedule, the Business may claim up to $300,000 on its
tax return for that tax year ($ l 00,000 per year for 3 years). The Business' tax liability for that tax year is $50,000
therefore; the Business will cant' forward $250,000 of unused credits.
ITC Earned -Total
$500,000
ITC Available to be Taken based on the Amortization Schedule $300,000 (FY 2006 - FY 2008)
Less ITC Claimed on Current Year's Tax Return $ 50,000
ITC to be Carried Foz•maz°d into Future Tax Year $250,000
The following year the Business may claim up to $350,000 in ITCs on its tax return; $250,000 being carried forward
from last year plus another $100,000 based on the amortization schedule. The Business' tax liability for the cun•ent
tax year is $60,000.
ITC Earned -Total $500,000
Less ITC Claimed to Date $ 50,000
ITC Remaining -Total $450,000
ITC Available to be Talcen based on the Amortization Schedule $100,000 (FY 2009)
Plus ITC Carried Forward from Previous Year $250,000
Less ITC Claimed on Current Year's Tax Return $ 60 000
ITC to be Carried Foz•u~ard into Future Tax Year $290,000
The following year the Business may claim up to $390,000 in ITCs on its tax return; $290,000 being carried forward
from last year plus another $100,000 based on the amortization schedule. The Business' tax liability for the current
tax year is $50,000.
ITC Earned -Total $500,000
Less ITC Claimed to Date $110 000
ITC Remaining -Total $390,000
ITC Available to be Taken based on the Amortization Schedule $100,000 (FY 2010)
Plzrs ITC Carried Forward from Previous Year $290,000
Less ITC Claimed on Cun•ent Year's Tax Return $ 50 000
ITC to be Crn•ried Foru~az•d into Future Tax Year $340,000
After FY 20l 0, the Business is no longer subject to the amortization schedule and therefore, it would be able to
continue to take tax credits based on its tax liability each year. If this example were to continue, the tax credits
could continue to be claimed until they are exhausted or until the carry forward period expires in the tax year in
which February 15, 2015 falls.
September l4, 2005
DESCRIPTION OF THE PROJECT AND AWARD BUDGET
(EXHIBIT C)
Name of Business: Dubuque Stampring Manufacturing, Inc.
Contract Number: P0~06Pa01729
PROJECT DESCRIPTION
Dubuque Stamping Manufacturing, Inc. will construct a 20,000 square foot building to connect
iwo plant sites which are adjacent to each other but separate. Project costs include land acquisition
and site prep, building construction, machinery & equipment, racking & shelving, computer hardware,
and furniture 8t fixtures.
AWARD BUDGET
SOURCE OF FUNDS
IDED Programs
Enterprise Zone Benefits
Business
private Sources
TOTAL ALL FUNDS
'$457,668 estimated value
Sou_r_ce__of Funds
TIF Rebate
Partial Tax Exemption
260E Job Training
In-Kind Contributions
RISE
RED
Other {describe)
USE OF FUNDS
Amount
Land Acquisition
'SeeNofeSite Preparation
$3,017,000 Cash
$28,000 Loan
SUBTOTAL $3,045,000
SUB 7"OTAL SD
$3,045,000
Total Other Funding
SUr3 70TA1
Cost
$40,000
$50,000
$1,200,000
$1,600,000
$100,000
$30,000
$15,000
$10,000
$3,045,000
So
$3,045,000
Other Funding
Total Amount Duration Used as Match
$91,800.00 4278.3*/5yr Yes
$85,000.00 No
$176,800.00
Updated 8108
Building Acquisition
*Building Construction
*Building Remodeling
*Mfg Machinery and Equipment
Other Machinery and Equipment
Racking, Shelving, etc.
Computer Hardware
Computer Software
Furniture and Fixtures
Working Capital
Research and Development
Jab Training
Other Expenses -salaries
Other Expenses -lease
SUBTOTAL.
* included as capital investment if awarded tax credit program
Iowa Code citing 4276.3 -the amount of actual value added which is eligible to be exempt
from taxation is as follows: 1st yr-75%, 2nd yr-60 % , 3rd yr-45 % , 4th yr-30%, 5th yr-75
~VISt~JI~
EXIIIBIT D - J®B O~LIGA'I'I®NS
I3ubuque Stamping & Manufacturing, Inc.
#OS-EZ-034
This Project has been awarded benefits from the Enterprise Zone (EZ) program. The chart below outlines the contractual job
obligations related to this Project.
Data in the "Employment Base" column has been verified by the Department and reflects the employment characteristics of the
facility receiving funding before this award was made. Jobs to be retained as a part of this Project must be included in these
calculations.
Data in the "Jobs To Be Created" column outlines the new full-time jobs (including their wage characteristics) that must be added to
the employment base and, if applicable, statewide employment base as a result of this award.
At the Project Completion Date and through the Project Maintenance Date, the Business must achieve (at a minimum) the numbers
found in the "Total Job Obligations" column.
Enterprise Zone JOB OBLIGATIONS
Project Completion Date: May 31, 2011
Project Maintenance Date: May 31, 2021 Employment
Base Jobs
To Be Created Total
Job
Obligations
Total employment at project location 155 10 165
Average Wage of total employment at project location $17.58
Qualifying wage threshold requirement (per hr) $12.91 (90%)
Benefit value (per hr) N/A
Number of jobs at or above qualifying wage 147 10 157
Average Wage of jobs at or above qualifying wage $17.89
Number of jobs at or above qualifying wage w/benefits N/A N/A N/A
Average wage of jobs at or above qualifying wage
w/benefits N/A
Notes re: Qualifying Wades
L If the Benefit Value was added to the base wage to meet program wage threshold eligibility
requirements, then any reduction in the Benefit Value during the life of the Contract must be
compensated for with salary to ensure that the Qualifying Wage rates are met.
2. Bonus or commission payments are not included when calculating the Qualifying Wage rate.
Revised 8/07
Exhibit E
Development Agreement By and Between the City of Dubuque,
Iowa and Morrison Brothers Company dated
LA NOT :Contract will not b executed y the Iowa
Department of economic Development until the Development
Agreement has been approved, signed and received.
September 14, 2005
AUTHORIZATION FOR RELEASE OF CONFIDENTIAL STATE TAX INFORMATION AND
CONFIDENTIAL UNEMPLOYMENT INSURANCE INFORMATION
The undersigned (noted below as "Taxpayer") is an applicant for or a recipient of an award by the Iowa Department of Economic
Development and has entered into contract number P0806M01729.
The undersigned hereby authorizes the Department of Revenue to provide to (Awarding Agency) state tax information in the file
pertinent to this contract or tax credit certificate(s). This Authorization for Release of Confidential State Tax Information shall be valid
for all tax periods either 1) fora 3-year period following completion of the contract or 2) fora 3-year period following completion of tax
credit claims using the above tax credit certificate number(s), whichever is longer.
In the case ofpass-through business entities (such as partnerships, limited liability companies, cooperatives, S corporations, etc.), data for
members of the business entity will be aggregated and released at the business level to the Awarding Agency with this signed release
from the business entity. The signature of a business representative on this Authorization form authorizes the Iowa Department
of Revenue to release tax information at the business entity level.
State tax information authorized for release includes tax information pertinent to the taxpayer for individual income tax, corporate
income tax, franchise tax, insurance premiums tax, sales and use tax, withholding tax, moneys and credits tax, and the replacement tax on
utilities that is requested by the Awarding Agency in the administration of tax credit programs and other state financial assistance
programs.
The undersigned hereby authorizes the Iowa Department of Workforce Development to provide to the Iowa Department of Revenue and
to the Awarding Agency the Employment Contribution and Payroll Tax Report (form 65-5300) and Multiple Worksite Report (BLS
3020) and information from these forms for the Employer Identification Number (EIN) number pertinent to the above specified contract
or tax credit certificate(s). Iowa Workforce Development may provide the information without providing the report. The confidential
unemployment insurance information will be released, pursuant to this authorization only to the Iowa Department of Economic
Development and/or The Department of Revenue for the purpose of evaluation and adminishation of tax credit programs and other state
fmancial assistance programs. This Authorization for Release of Confidential Unemployment Insurance information shall be valid for all
periods either 1) fora 3-year period following completion of the contract or 2) fora 3-year period following completion of tax credit
claims using the above tax credit certificate number(s), whichever is longer.
Name of Taxpayer:
Street Address:
City, State, Zip
Telephone Number:
Email Address:
4/ s.,~`~ i~~ ~ t, ~..'~°~`~d'3^v/1® .:mob ~ .~Fs_~ ;~
~- ate. -
Social Security Number (for individuals):
Employer Identification Number (for businesses)
<. ~
Unemployment Insurance Number (for businesses): f `~ /pE~~
Type of Entity: ^ Individual/Sole Proprietorship ^ Partnership Vii' a Corp ^ C Corp
^ LLC ^ Cooperative ^ Other (specify)
Signature of Taxpayer:
Title (Required for partnerships and corporations'): ~ ~ ~ ~~-~
Date signed: ~ t '° ~ ~ ,~
`Partnerships -Only partners can authorize release of information.
Corporations -Only corporate officers can authorize release of information.
Revised 9/06
DOCUMENTS NEEDED FOR RECEIPT OF PROGRAM BENEFITS
Master Contract Documents 5.1:
Received
n
Responsibility of:
Fully executed Master Contract [§5.1(a)] Business, IDED
Certified copy of the corporation's Articles of Incorporation [§5.1(d)] Business
Certificate of Corporate Existence from the Iowa Secretary of State [§5.1(e)] Business
Results of Lien and Tax Search against the Business and Security Property IDED
^ Solid and Hazardous Waste Reduction Plan. To comply with Iowa Code section Business
15A.1(3)"b". (If the company doesn't have hazardous waste, they'll still have solid, i. e. wastepaper.
They need to either use one of the contacts provided with the award letter, or provide in-house audit results or
proposal of an in-house audit). [§5.1(1)]
^ Signed Authorization for Release of Confidential State Tax Information form Business
[§S.1G)]
^ Documentation of satisfactory credit history of Business and guarantors [§5.1(k)] IDED
^ Project Financial Commitments with a letter from each funding source to include Business
amount, rate and terms [§5.1(1)]
^ Other
Fu~rdin~ A~reenzent Docun:eats:
^ Fully executed Funding Agreement. [§5.1(b)]
Business, IDED
NO'T'E: Once all documents have been received by your project manager, the business will be
issued a tax credit certificate number which the Iowa Department of Revenue is now requiring
for all tax credits claimed in 2006 and future years.
Apri12006
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