40 Main LLC Collateral Assignment_Premier BankMasterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: 40 Main LLC Collateral Assignment of Parking Purchase Contract
DATE: January 25, 2010
Dubuque
hfrd
An- AmaicaCity
1
2007
In September 2009, the City Council approved a Purchase Contract with 40 Main, LLC
for the sale of excess street Right -of -Way to be used for private parking for the building
located at 40 -42 Main Street in downtown Dubuque (the former Higley Chemical
Building).
Premier Bank, the lending institution for 40 Main, LLC, has requested an assignment of
the Purchase Contract to provide additional collateral in the project.
Economic Development Director Dave Heiar recommends City Council approval of the
Collateral Assignment of Contract between Premier Bank and 40 Main, LLC.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David Heiar, Economic Development Director
Michael C. Van Milligen
Masterpiece on the Mississippi
TO: Michael Van Milligen, City Manager
FROM: David Heiar, Economic Development Director /,_,)
SUBJECT: 40 Main LLC Collateral Assignment of Parking Purchase Contract
DATE: January 15, 2010
RECOMMENDATION /ACTION STEP
I recommend that the City Council adopt the attached resolution approving the Collateral
Assignment of Contract between Premier Bank, and 40 Main, LLC.
Dubuque
AII- Amerlcaaq►
111 r
2007
INTRODUCTION
In September 2009, the City Council approved a Purchase Contract with 40 Main, LLC for the
sale of excess street Right of Way to be used for private parking for the building located at 40-
42 Main Street in downtown Dubuque (the former Higley Chemical Building).
BACKGROUND
The project to rehabilitate the 40 Main property involves significant restoration work. The
30,000 square foot building will include 18 market -rate apartments and 7,800 square feet of
commercial space. The work will be done in accordance with the U.S. Secretary of the Interior's
standard as Federal and State Historic Rehabilitation Tax Credits will be used for the project.
Several parcels owned by the City have been placed under contract with 40 Main, LLC to
purchase land for parking needed for the redevelopment of the building.
The Purchase Contract for the street Right of Way was approved by Resolution 360 -09 on
September 21, 2009 by the City Council for the sale of the following real estate:
Lot 1 of 10A, Lot 1 of 12A, and Lot 1 of 17A all in the West Half of Block 1 and Lot 1 of
1A in the West Half of Block 10 in Dubuque Harbor Company's Addition in the City of
Dubuque, Dubuque County, Iowa
DISCUSSION
Premier Bank, the lending institution for 40 Main, LLC, has requested an assignment of the
Purchase Contract to provide additional collateral in the project. The City Council is required to
approve this assignment.
The Collateral Assignment of Contract is attached and has been reviewed by City Attorney
Barry Lindahl.
Attachments
F: \USERS \Econ Dev\40 Main\40 Main Vacate and Replat\20100115 Parking Collateral Assignment Memo.doc
Prepared by: David J. Heiar, City of Dubuque, 50 W. 13th Street, Dubuque, IA 52001 (563) 589 -4393
Return to: David J. Heiar, City of Dubuque, 50 W. 13th Street, Dubuque, IA 52001 (563) 589 -4393
RESOLUTION NO. 23 -10
RESOLUTION APPROVING A COLLATERAL ASSIGNMENT OF
CONTRACT BETWEEN PREMIER BANK AND 40 MAIN, LLC.
Whereas, a Purchase Contract was approved by Resolution 360 -09 by the
Dubuque City Council for the following Real Estate:
Lot 1 of 10A, Lot 1 of 12A, and Lot 1 of 17A all in the West Half of Block 1
and Lot 1 of 1A in the West Half of Block 10 in Dubuque Harbor Company's
Addition in the City of Dubuque, Dubuque County, Iowa;
and
Whereas, Premier Bank is requesting additional collateral as Lender for
the redevelopment of the former Higley Chemical building located at 40 South
Main Street; and
Whereas, the City must approve the Assignment as the contract has not
been completed.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF DUBUQUE, IOWA:
Section 1. The Collateral Assignment of Contract between Premier
Bank and 40 Main, LLC is hereby approved.
Section 2. That the Mayor be authorized and directed to execute a
Collateral Assignment of Contract.
Att s
Passed, approved and adopted this 1st day of Februa j 2010.
Roy D. Buol, Mayor
eanne F. Schneider, CMC, City Clerk
F: \USERS \Econ Dev \40 Main \40 Main Vacate and Replat\20100201 Resolution approving 40 Main Parking
Assignment.doc
THIS DOCUMENT PREPARED BY
AND AFTER RECORDING RETURN
DOCUMENT TO:
D. Flint Drake
DRAKE & FREUND, P.C.
1005 Main Street, Suite 200
Dubuque, IA 52001
(563) 582 -2000
COLLATERAL ASSIGNMENT OF REAL ESTATE CONTRACT
Name of Grantor:
Name of Grantee:
Dated as of February _ , 2010
40 MAIN, LLC
an Iowa limited liability company
PREMIER BANK,
an Iowa banking corporation
Legal Description: Lot 1 of 10A, Lot 1 of 12A and Lot 1 of 17A all in the West Half
of Block 1 and Lot 1 of 1A in the West Half of Block 10 all in Dubuque Harbor
Company's Addition, in the City of Dubuque, Dubuque County, Iowa.
COLLATERAL ASSIGNMENT OF REAL ESTATE CONTRACT
THIS COLLATERAL ASSIGNMENT OF REAL ESTATE CONTRACT is
made and entered into as of the day of February, 2010 by and between 40 MAIN,
LLC, an Iowa limited liability company ( "Grantor "), and PREMIER BANK, an Iowa
banking corporation, ( "Grantee ").
RECITALS:
A. Grantor and Grantee have entered into a certain Commercial Loan
Agreement dated July 31, 2009 pursuant to which Grantee made to
Grantor a certain loan (the "Loan") in the aggregate principal amount of
$2,835,000.00 and, of even date therewith, Grantor and Grantee entered
into an Agreement to Assignment of Interest in Real Estate Contract (the
"Agreement to Assign ") and a Commercial Loan Agreement, Promissory
Note, Mortgage, Security Agreement and other loan documents (the "Loan
Documents ");
B. The Agreement to Assign provided that at such time as Grantor in
finalized an agreement with the City of Dubuque, Iowa ( "City ") to acquire
certain property of the City to be used to develop parking for the project of
Grantor (the "Parking Property "), Grantor would assign its rights under
the attendant Real Estate Contract to Grantee as additional security for the
Loan. The legal description for the Parking Property has now been
determined and Grantor and City have entered into a Real Estate Contract
(the "Contract ") pursuant to which Grantor is purchasing from City the
Parking Property legally described as follows: : Lot 1 of 10A, Lot 1 of
12A and Lot 1 of 17A all in the West Half of Block 1 and Lot 1 of 1A
in the West Half of Block 10 all in Dubuque Harbor Company's
Addition, in the City of Dubuque, Dubuque County, Iowa. The
Contract was recorded November 30, 2009 as Instrument No. 2009-
00021857 in the records of the Dubuque County Recorder and the parties
now desire to execute the assignment contemplated by the Agreement to
Assign;
THEREFORE, in consideration of the foregoing recitals and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties agree
upon the following mutual terms and conditions:
1. Assignment. Grantor hereby grants, transfers and assigns to Grantee,
Grantor's interest in and to the Contract, together with the structures,
fixtures, additions, enlargements, repairs, replacements and improvements
now or hereafter located upon the Parking Property subject thereto.
2. Indebtedness Secured. (a) This Assignment is made for the purpose of
securing the payment, when due, of the Loan including, without limitation,
Assignment of Leases and Rents (QLICI Loans) Exhibit
1753052.7
the principal sum, interest and all other sums evidenced by the Promissory
Note and any other sums due from Grantor to Grantee under any of the other
Loan Documents; and,
(b) The payment, performance and discharge, when due, of each and every obligation,
covenant and agreement of Grantor under any Loan Document with Grantee.
3. Grantor's Warranties. Grantor represents and warrants to Grantee that: (i)
Grantor is the sole owner of the entire purchaser's interest in the Contract
and has good title and good right to assign the Contract hereby assigned and
no other person or entity has any right, title or interest therein (ii) the
Contract is in all material respects valid and enforceable and has not been
altered, modified or amended in any manner since the date of recording; (iii)
the Contract has not been assigned or otherwise pledged or hypothecated;
Grantor has full power and authority to execute and deliver this Assignment
and the execution and delivery of this Assignment has been duly authorized
and does not conflict with or constitute a default under any law, judicial
order or other agreement affecting Grantor or the Parking Property which is
the subject of the Contract; (iv) Grantor has duly and punctually performed
all of the terms, covenants, conditions and warranties of the Contract that
were to be kept, observed and performed by it to date; (v) Grantor has not
performed any act or executed any other instrument which might prevent
Grantee from enjoying and exercising any of its rights and privileges
evidenced hereby; and, (vi) Grantor shall execute and deliver at the request
of Grantee all such further assignments and other documents, instruments
and assurances with respect to the Contract as Grantee shall from time to
time require in order to effectuate the purposes of this Agreement.
4. Present and Absolute Assignment/Remedies of Grantee. Grantor does
hereby absolutely and unconditionally assign to Grantee all of Grantor's
right, title and interest in the Contract. Nothing herein shall be construed to
bind Grantee to the performance of any of the covenants, conditions, or
provisions contained in the Contract or otherwise to impose any obligations
upon Grantee. Grantor shall make all payments and comply in all respects
with purchaser's obligations under the Contract and shall hold all right and
title to the Parking Property subject to the Contract in trust as security for
Grantor's obligations to Grantee. Grantor shall, concurrent herewith, execute a
Quit Claim Deed to Grantee for the Real Estate which Deed shall be held in escrow
by Grantee. Upon an Event of Default (as defined in the Loan Documents), the
license granted to Grantor herein shall automatically terminate and Grantee shall be
immediately entitled to receive all benefits of purchaser under the Contract. Upon
or any time after an Event of Default, Grantee may record the Quit Claim Deed and
proceed as purchaser under the terms of the Contract. Grantee may take such
action without notice to Grantor and without regard to the adequacy of the security
for the Debt, but shall provide written notice thereof to City. Grantee does not
waive any other rights Grantee may have at law, equity or pursuant to the terms of
the Loan Documents. Notwithstanding any other remedies available to Grantee, in
the event Grantee proceeds to record the Quit Claim Deed and proceed as
purchaser under the terms of the Contract, Grantee may take possession of the
Parking Property subject to the Contract and have, hold, manage, lease and
operate such Parking Property on such terms and for such period of time as
Grantee may deem proper, subject in all respects to the terms of the
Contract. Grantee may apply any rents or sale proceeds associated with the
Parking Property obtained by Grantee to the payment of the following in
such manner and order as Grantee in its sole and absolute discretion may
determine, any law, custom or use to the contrary notwithstanding: (a) all
expenses of securing, managing, operating and maintaining the Parking
Property including, without limitation, the salaries, fees and wages of a
managing agent and such other employees or agents as Grantee may deem
necessary or desirable; all taxes, charges, claims, assessments, water
charges, sewer rents and any other liens; premiums for all insurance which
Grantee may deem necessary or desirable; the cost of all alterations,
renovations, repairs or replacements; and all expenses incident to taking and
retaining possession of the Parking Property; and (b) the Loan, together with
all court costs and attorney fees, receiver fees and all other costs and
expenses incurred by Grantee.
5. No Liability of Grantee. GRANTEE SHALL NOT BE LIABLE FOR
ANY LOSS SUSTAINED BY GRANTOR RESULTING FROM
GRANTEE'S USE OF THE PARKING PROPERTY OR ANY PART
THEREOF, OR FROM ANY OTHER ACT OR OMISSION OF
GRANTEE UNDER OR RELATING TO THE PARKING
PROPERTY OR THE CONTRACT AND RELATED AGREEMENTS
(REGARDLESS OF WHETHER SUCH LOSS IS THE RESULT OF
GRANTEE'S NEGLIGENCE) UNLESS SUCH LOSS IS CAUSED BY
THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
GRANTEE, NOR SHALL GRANTEE BE OBLIGATED TO
PERFORM OR DISCHARGE ANY OBLIGATION, DUTY OR
LIABILITY UNDER THE CONTRACT BY REASON OF THIS
INSTRUMENT OR THE EXERCISE OF RIGHTS OR REMEDIES
HEREUNDER. Grantor hereby agrees to hold Grantee harmless from any
and all liability, loss or damage (including attorney fees and the costs of
defense) from any and all claims and demands whatsoever asserted against
Grantee pursuant to the Contract or this Assignment, including, without
limitation, any claims or demands related to any alleged obligations or
alleged undertakings on Grantee's part to perform or discharge any of the
terms, covenants or agreements contained in the Contract. Grantor shall
reimburse Grantee immediately upon demand for the amount of any such
liability, loss or damage, the payment of which shall be secured by this
Assignment and by any of the other Loan Documents. The execution of this
Assignment shall not obligate or make Grantee liable for (i) the control,
care, management or repair of the Parking Property, (ii) the carrying out of
any of the terms and conditions of the Contract, (iii) any waste committed
on such Parking Property by any party; (iv) any dangerous or defective
condition of such Parking Property, including without limitation the
presence of any Hazardous Material or (v) any negligence in the
management, upkeep, repair or control of such the Parking Property
resulting in loss or injury or death to any tenant, licensee, employee or
stranger. THE RELEASES AND INDEMNITIES CONTAINED IN
THIS PARAGRAPH SHALL INCLUDE CLAIMS, DEMANDS,
LIABILITIES, LOSSES, DAMAGES, CAUSES OF ACTION,
JUDGMENTS, PENALTIES, COSTS AND EXPENSES (INCLUDING,
WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES)
RESULTING FROM THE NEGLIGENCE OF GRANTEE OR ANY
STRICT LIABILITY, BUT NOT THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF GRANTEE.
6. Other Security. Grantee may take or release other security for the payment
of the Loan, may release any party primarily or secondarily liable therefor
and may apply any other security held by it to the reduction or satisfaction
of the Loan without prejudice to any of its rights under this Assignment.
7. Other Remedies. Nothing contained in this Assignment and no act done or
omitted by Grantee pursuant to the power and rights granted to Grantee
hereunder shall be deemed to prejudice or waive Grantee's rights and
remedies under the Loan Documents. Grantee's right to collect the Loan
and to enforce any other security held by it may be exercised by Grantee
either prior to, simultaneously with, or subsequent to any action taken by it
hereunder.
8. No Mortgagee -in- Possession. Nothing herein contained shall be construed
as constituting Grantee a "mortgagee -in- possession" or "beneficiary-in -
possession" in the absence of the taking of actual possession of the Parking
Property by Grantee. Grantor hereby expressly waives and releases all
claims and liability against Grantee in Grantee's exercise of its rights and
powers hereunder.
9. Conflict of Terms. In case of any conflict between the terms of this
Assignment and the terms of any other Loan Document, the terms of this
Assignment shall prevail.
10. Miscellaneous. This Assignment shall be governed by and construed in
accordance with the laws of the State of Iowa. Grantor hereby submits to personal
jurisdiction in the state courts located in Dubuque County, Iowa for the
enforcement of Grantor's obligations hereunder and waives any and all personal
rights under the law of any other state or jurisdiction to object to jurisdiction with
such state courts for the purposes of any action, suit, proceeding or litigation to
enforce such obligations of Grantor. Upon payment in full of the Loan, or any
modifications, extensions, renewals or refinancings thereof, this Assignment shall
be null and void and of no further effect. Grantee shall have the right to assign or
transfer its rights under this Assignment without limitation, but shall provide
written notice thereof to City. This Assignment, together with the covenants and
warranties herein contained, shall inure to the benefit of Grantee and any
11. City Consent. The City of Dubuque, Iowa, joins in this agreement for the
sole purpose of consenting to the Collateral Assignment of Real Estate
Contract and for no other purpose.
STATE OF IOWA
COUNTY OF DUBUQUE
subsequent holder of the Loan Documents and shall be binding upon Grantor, its
heirs, executors, administrators, successors and assigns and any subsequent owner
of the Parking Property.
)
) ss:
STATE OF IOWA )
COUNTY OF DUBUQUE ) ss:
40 MAIN, LLC, an Iowa limited liability
company
By: 40 Main MM, LLC
By:
Name: Patrick Duffy
Title: Manager
On this day of , 2010, before me, a Notary Public in and for
the State of Iowa, personally appeared PATRICK DUFFY, to me personally known, who being
by me duly sworn did say that he is the Manager of said limited liability company, that no seal
has been procured by the said limited liability company and that said instrument was signed on
behalf of said limited liability company by authority of its managers and the said PATRICK
DUFFY acknowledged the execution of said instrument to be the voluntary act and deed of said
limited liability company, by it voluntarily executed.
Notary Public in and for
State of Iowa
PREMIER BANK, an Iowa banking corporation
By:
On this day of , 2010, before me, the undersigned, a Notary
Public in and for the State of Iowa, personally appeared to me personally
known, who being by me duly sworn, did say that is the , of said
corporation executing the within and foregoing instrument; that the instrument was signed on
behalf of said corporation by authority of its Board of Directors; and the said
acknowledged the execution of said instrument to be the voluntary act and deed of said
corporation, by it and by them voluntarily executed.
STATE OF IOWA )
)
COUNTY OF DUBUQUE )
Notary Public
in and for State of Iowa
THE CITY OF DUBUQUE, IOWA
By:
Roy D. Buol, Mayor
On this day of , 2010, before me, , a
Notary Public in and for the State of Iowa, personally appeared ROY D. BUOL to me
personally known, and, who, being by me duly sworn, did say that he is the Mayor of the
City of Dubuque, Iowa; that the seal affixed to the foregoing instrument is the corporate
seal of the corporation, and that the instrument was signed and sealed on behalf of the
corporation by authority of its City Council and he acknowledged the execution of the
instrument to be his voluntary act and deed and the voluntary act and deed of the
corporation, by it voluntarily executed.
Notary Public in and for State of Iowa
YIEW110•111N.r
subsequent holder of the Loan Documents and shall be binding upon Grantor, its
heirs, executors, administrators, successors and assigns and any subsequent owner
of the Parking Property.
11. City Consent. The City of Dubuque, Iowa, joins in this agreement for the
sole purpose of consenting to the Collateral Assignment of Real Estate
Contract and for no other purpose.
STATE OF IOWA )
COUNTY OF DUBUQUE ) ss:
On this r? 5 f day of T n LAowy , 2010, before me, a Notary Public in and for
the State of Iowa, personally appeared PATRICK DUFFY, to me personally known, who being
by me duly sworn did say that he is the Manager of said limited liability company, that no seal
has been procured by the said limited liability company and that said instrument was signed on
behalf of said limited liability company by authority of its managers and the said PATRICK
DUFFY acknowledged the execution of said instrument to be the voluntary act and deed of said
limited liability company, by it voluntarily executed.
et
, ow,.
RArVA ONDECKE
Commission Number 719297
My Comm. Exp. O •.. 11
STATE OF IOWA
COUNTY OF DUBUQUE
On this day of S�4 ti✓r�'' , 2010, before me, the undersigned, a Notary
Public in and for the State of Iowa, personally appeared /9. 5 t l to me personally
known, who being by me duly sworn, did say that A e. is the V,'ce , of said
corporation executing the within and foregoing instrument; that the instrument was s�i ned 9n
behalf of said corporation by authority of its Board of Directors; and the said 1/'ce �'✓et,�(ef,X-
acknowledged the execution of said instrument to be the ntary act and deed of said
PREMIER BANK, an I wa banking corporation
Byr
) ss:
corporation, by it and by them voluntarily e = . e
±_INDECKER
Numhsr 719297
my _ 7rc x✓ I
40 MAIN, LLC, an Iowa limited liability
company
By: 40 Main M
By:
Name. Patrick Du
Title: Manager
r Public in and for
ate of Iowa
N • ary Public
in and for State of Iowa