Star Brewery Alexander Co Lease
D~
~ck~
MEMORANDUM
March 9, 2004
TO:
The Honorable Mayor and City Council Members
FROM:
Michael C. Van Milligen, City Manager
SUBJECT: Lease Agreement with Alexander Company for former Dubuque Star
Brewery Building
In November 2002, the Alexander Company was the only developer to submit a final
proposal to redevelop the former brewery building. Total estimated costs at that date
were $5.6 million. Since that date City staff has worked with the Alexander Company in
an attempt to finalize a Development Agreement and a mutually acceptable financing
plan for the project. The total estimated cost was updated by the Company in
September of 2003, and is now $6.6 million.
The Alexander Company has completed much of the preliminary work for the
redevelopment of the former Dubuque Star Brewery. The Durrant Group has prepared
design development drawings. Kraemer Brothers General Contractors has submitted
construction cost estimates. Historical Tax Credit applications have been prepared and
approved for the project.
However, because of the existing condition of the building, compounded by the fact that
the Company does not have site control or a timeline, lease commitments for the space
have not been completed. The Alexander Company is unable to obtain the required
amount of equity to complete the project without reaching pre-leasing targets
established by their equity investor.
An updated "phased approach" proposal has been negotiated that would have the City
provide initial funds of $800,000 to the project to be used for initial renovation of the
building. The City has targeted $650,000 in CDBG funds for the project, and $150,000
from conference center savings. Kraemer Brothers has provided the Company with a
proposal for the use of the initial City funding. This proposal will include interior and
exterior brick cleaning, sandblasting, tuck-pointing and repair, structural repair and roof
replacement, and partial building demolition (the red building). The Alexander Company
would not receive any Developer fees in this phase, however design and construction
fees for this phase would be provided to the Durrant Group and Kraemer Brothers. A
reimbursement for the Historic Tax Credit certification would also be provided.
The lease agreement requires detailed construction plans for this phase to be submitted
by April 30, work to begin no later than June 14 and be completed by October 14. The
term of the lease (twelve months) expires on April 14, 2005. Therefore, the company
has the remaining six months to obtain pre-lease agreements with tenants and
negotiate a long term Development Agreement with the City.
If the Company fails to obtain the pre-leasing requirements of their lender, or we are not
able to negotiate a final Development Agreement, the short-term lease will terminate
and the City will retain control of the improved building.
Economic Development Director Bill Baum is recommending execution of this one-year
lease in anticipation of arriving at a long-term development agreement after conditions
have been met for the Alexander Company to obtain the additional financing needed for
the project.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
fYkIJf ~~L
Michael C. Van Milligen "
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
William Baum, Economic Development Director
D~
~ck~
MEMORANDUM
March 8, 2004
FROM:
Michael C. Van Milligen, City Manager
William Baum, Economic Development Director ~
TO:
SUBJECT: Lease Agreement with Alexander Company for former Dubuque Star
Brewery building
Background
In June, 2002 the City issued a Request for Qualifications from developers interested in
the redevelopment of the former Dubuque Star Brewery building. Four developers
responded and three - The Alexander Company, Platinum Hospitality Group, and
Dubuque Star Brewing Company - were invited to submit proposals in September,
2002.
In November 2002, The Alexander Company was the only developer to submit a final
proposal to redevelop the former brewery building. Total estimated costs at that date
were $5.6 Million. Since that date City staff has worked with the Alexander Company in
an attempt to finalize a Development Agreement and a mutually acceptable financing
plan for the project. The total estimated cost was updated by the Company in
September of 2003, and is now $6.6 Million.
The Alexander Company has completed much of the preliminary work for this project.
The Durrant Group has prepared design development drawings. Kraemer Brothers
General Contractors have submitted construction cost estimates. Historical Tax Credit
applications have been prepared and approved for the project.
However, because of the existing condition of the building, compounded by the fact that
the Company does not have site control or a timeline, lease commitments for the space
have not been completed. The Alexander Company is unable to obtain the required
amount of equity to complete the project without reaching pre-leasing targets
established by their equity investor.
Discussion
An updated "phased approach" proposal has been negotiated that would have the City
provide initial funds of $800,000 to the project to be used for initial renovation of the
building. The City has targeted $650,000 in CDBG funds for the project, and $150,000
from conference center savings. Kraemer Brothers has provided the Company with a
proposal for the use of the initial City funding. This proposal will include interior and
exterior brick cleaning, sandblasting, tuck-pointing and repair, structural repair and roof
replacement, and partial building demolition (the red building). The Alexander Company
would not receive any Developer fees in this phase, however design and construction
fees for this phase would be provided to the Durrant Group and Kraemer Brothers. A
reimbursement for the Historic Tax Credit certification would also be provided.
A proposed attached Lease Agreement has been prepared, reviewed by our corporation
counsel Barry Lindahl and our bond counsel Bill Noth, and after negotiation, approved
by the Alexander Company. The Lease Agreement includes a Loan Agreement for the
$800,000 as Exhibit C1. Because the Lease Agreement is for a period of less than three
years, the City Council may approve this Lease Agreement by resolution at a regular
City Council meeting.
The lease agreement provides that the City be responsible for remediation of any
environmental issues on the property. The City has had a Phase I Environmental Study
completed by Terracon, and a follow up inspection from Environmental Management
Corporation. I do not anticipate any major issues orcosts for remediation. If however,
unanticipated mitigation is required, the cost could be paid from the Economic
Development Initiative grant received last year for this purpose. We currently have a
balance in the grant of approximately $200,000.
The lease agreement requires detailed construction plans for this phase to be submitted
by April 30, work to begin no later than June 14 and be completed by October 14. The
term of the lease (twelve months) expires on April 14, 2005. Therefore, the company
has the remaining six months to obtain pre-lease agreements with tenants and
negotiate a long term Development Agreement with the City.
If we are not able to negotiate a final Development Agreement, or the company is not
successful with the pre-lease agreements, the Lease Agreement will terminate at
expiration (April 14, 2005) and the City will retain control of the improved building.
The Lease Agreement also contains an Exhibit C: Description of Financial Assistance
and Construction Assistance. The City will provide a Community Development Block
Grant Loan ($650,000) and a Construction Loan ($150,000) for the work to be
accomplished. These are funds the City would have used to stabilize the building if we
were unable to negotiate this Lease Agreement.
The Loan Agreement, Exhibit C.1. provides:
. The loan is a nonrecourse loan to the Company, no principal or interest is due
until the end of the one-year lease at which time, if the Company has completed
the improvements, the entire loan terms may be renegotiated according to the
terms of a Development Agreement.
. The disbursement of funds will be based upon documented expenses of the
Company.
. The Company must comply with all regulations of the Community Development
Block Grant program. The program requires payment of "Davis Bacon" wages
for all trades working on the project.
Recommendation
I recommend the City Council approve approving the Lease Agreement, agree to
provide an initial $800,000 to stabilize and improve the building. We will continue to
work on the permanent financing and formal Development Agreement during the next
twelve months.
Action Requested
I request City Council adoption of the attached resolution, approving the one year Lease
Agreement and Loan Agreement between the City and the Alexander Company's LLC
(Historic Star Redevelopment).
F:\USERS\WBaum\Brewery Oeal\Memo on initial lease agreement.doc
RESOLUTION NO. 122-04
APPROVING A LEASE AGREEMENT AND LOAN AGREEMENT FOR THE FORMER
STAR BREWERY BETWEEN THE CITY OF DUBUQUE,IOWA AND HISTORIC STAR
REDEVELOPMENTLLC
WHEREAS, the City of Dubuque (City) is the owner of the former Star Brewery
Building; and
WHEREAS, City has been negotiating with The Alexander Company on the
redevelopment of the former Star Brewery Building by Historic Star Redevelopment,
LLC; and
WHEREAS, a proposed Lease Agreement and Loan Agreement with Historic
Star Redevelopment LLC, copies of which are attached hereto, have been tentatively
agreed upon by City and Historic Star Redevelopment LLC; and
WHEREAS, the City Council finds that entering into the Lease Agreement and
Loan Agreement is in the best interests of the City of Dubuque and its citizens.
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE:
1. The attached form of Lease Agreement and Loan Agreement are hereby
approved.
2. The Mayor ishereby authorized and directed to execute the Lease Agreement
and Loan Agreement on behalf of the City of Dubuque.
Passed and approved this 15thday of March, 2004.
Terrance M. Duggan, Mayor
Attest:
Jeanne F. Schneider, City Clerk
F: \USERS\WBa urn \Brewery Deal\reso lutio n BreweryLease. doc
03/08/04
LEASE AGREEMENT
THIS LEASE AGREEMENT (the "Lease") made as of the 16th day of March,
2004, by and between the CITY OF DUBUQUE, IOWA, a municipal corporation
"Lessor"), and Historic Star Redevelopment LL.C. , a Wisconsin Limited Liability
Company (Lessee).
WHEREAS, Lessee has requested that Lessor lease to Lessee that certain real
property and improvements, commonly known as the Star Brewery Building, located in
the City of Dubuque, Dubuque, County, Iowa (hereinafter called "the Property") as
described herein; and
WHEREAS, the redevelopment of the Property is an economic development
project involving private and public investment and the creation of new jobs and
income; and
WHEREAS, the redevelopment of the Property will generate tourism-releated
activities;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, the parties hereto agree as follows:
ARTICLE I
DEMISE AND TERM
1. In consideration of the rents hereinafter reserved and the terms, covenants,
conditions and agreements set forth in this Lease, Lessor hereby leases to Lessee the
real property together with any and all easements and appurtenances thereto and
subject to any easements and restrictions of record described in Exhibit "A" attached to
and made a part of this Lease, ("the Property" ), to have and to hold for a term of twelve
(12) months, or such longer or shorter term as the parties may agree in writing,
commencing on the Closing Date, subject to all of the terms, covenants, conditions and
agreements contained herein.
"Closing Date" shall mean the date on which this Lease is executed by the
parties which shall be the 14th day of April, 2004, or such earlier date as the parties may
agree in writing.
ARTICLE II
RENT
2. Lessee shall pay Lessor, in addition to utilities, taxes, assessments, and other
charges required to be paid under this Lease by Lessee, rent for the Property of One
Dollar per year.
ARTICLE III
ENCUMBRANCE OF LESSEE'S LEASEHOLD INTEREST
3. Lessee's riaht to encumber leasehold interest. Lessee shall not
encumber by mortgage, deed of trust, or other proper instrument, its leasehold interest
and estate in the Property without the Lessor's advanced written consent.
ARTICLE IV
TAXES AND UTILITIES
4.1 Lessee agrees to pay as additional rent all utilities and an amount equal to
real estate taxes upon the real estate of the Property for the term hereof prorated from
the Closing Date to date of termination of this Lease. Lessee shall further provide to
Lessor official receipts of the appropriate taxing authority or other evidence satisfactory
to Lessor evidencing payment thereof. Any such taxes that are not yet payable during
the term of this Lease shall be prorated to the date of termination of this Lease and paid
to Lessor at the time of termination of this Lease.
4.2 Lessor agrees to pay all other taxes, rates, charges, levies and assessments,
general and special, of every name, nature and kind, whether now known to the law or
hereafter created which may be taxed, charged, assessed, levied or imposed upon said
real estate. Any taxes, charged, assessed, levied or imposed upon the leasehold estate
hereby created by any buildings or improvements to the Property during the term
hereof, shall be paid by Lessee as they become due and before they become
delinquent and prorated as provided for in Section 4.1.
4.3 Lessee agrees to timely pay all taxes, assessments or other public charges
levied or assessed by lawful authority (but reasonably preserving Lessee's rights of
appeal) against its personal property on the premises, during the term of this Lease.
4.4 Nothing herein shall require Lessee to pay any of Lessor's income taxes,
surtaxes, excess profit taxes or any taxes on the rents reserved to Lessor hereunder.
2
ARTICLE V
REPAIRS
5. Lessee shall at all times during the term of this Lease, at Lessee's own costs
and expense, keep the Property and the Minimum Improvements thereon, and all
sidewalks, curbs, and all appurtenances to the Property, in good order, condition, and
repair, casualties and ordinary wear and tear excepted.
ARTICLE VI
COMPLIANCE WITH LAW
6. During the term of this Lease, Lessee shall comply with all applicable laws
applicable to Lessee's use of the Property, the breach of which might result in any
penalty on Lessor or forfeiture of Lessor's title to the Property.
ARTICLE VII
ALTERATIONS
7.1 ReQuired Minimum Improvements. Lessee hereby agrees to rehabilitate
the Property by constructing the improvements described in Exhibit "B," attached hereto
and incorporated herein by reference (the "Minimum Improvements").
7.2 Plans for Construction of Minimum Improvements. Plans and
specifications with respect to the construction of the Minimum Improvements (the
"Construction Plans") shall be approved by Lessor provided they are in conformity
with the Port of Dubuque Master Plan Design Standards, this Agreement, and all
applicable State and local laws and regulations. To that end, Lessee shall, on or before
April 30, 2004, submit to Lessor, for approval by Lessor, the Construction Plans and
such additional documents as the Lessor may reasonably request with respect to the
Minimum Improvements to be constructed by Lessee on Property. All work with respect
to the Minimum Improvements shall be in conformity with the Construction Plans as
approved by Lessor and shall be coordinated with Lessor improvements in the general
vicinity of Property, including, but not limited to, the Alliant Plaza, Riverwalk, the
Conference Center and street and utility improvements. The Minimum Improvements
shall meet the Secretary of the Interior's Standards for Rehabilitation and Guidelines for
Rehabilitating Historic Buildings.
3
7.3 Timina of Improvements. Lessee hereby agrees that construction of the
Minimum Improvements on Property shall be commenced within two (2) months after
the Closing Date, and shall be substantially completed within four (4) months after the
commencement of construction. The time frames for the performance of these
obligations shall be suspended during the period of any delays caused by acts of God
and matters not within the control of Lessee including, but not limited to, extreme
weather conditions and/or other natural causes, casualty, labor problems (including, but
not limited to, strikes, walk-outs, picketings, boycotts and shutdowns), govemmental
restriction upon the availability or use of labor or materials, Remediation which is the
Lessor's obligation to undertake in accordance with Section 7.5, or, insurrection,
embargoes, or delays in providing necessary consents or approvals. The time for
performance of such obligations shall be extended only for the period of such delay.
Lessee hereby agrees to schedule the construction of the Minimum Improvements so
that events scheduled at the Alliant Amphitheater will not be impacted and access to
the Amphitheater will be maintained during the events.
7.4 Certificate of Completion. Promptly upon completion of the Minimum
Improvements in accordance with those provisions of this Lease Agreement relating
solely to the obligations of Lessee to construct the Minimum Improvements (including
the dates for beginning and completion thereof), Lessor shall furnish Lessee with an
appropriate instrument so certifying.
7.5 Condition of Property. Lessor shall deliver Property in its "as is"
condition. Lessee shall have the right to inspect Property prior to closing and to take
whatever tests or perform such examination as Lessee shall deem appropriate, at its
sole cost and expense. Notwithstanding the foregoing or anything else set forth herein
or in any other agreement between the Lessee and Lessor, Lessor shall be responsible
for all costs and expenses' relating to Remediation, as that term is defined below, in
accordance with the following provisions:
(A) Prior to the date hereof, Lessor has provided to Lessee copies of
any and all environmental reports or investigations known by and within the possession
of the Lessor, or any of its agencies (the "Reports"), which Reports have been
undertaken on the Property. The Lessor warrants and represents that the Reports
previously provided to Lessee constitute all of the Reports in the possession of the
Lessor as known to its current officers and officials, as of the Effective Date, and to the
knowledge of the Lessor's current officers and officials there have been no studies
undertaken with respect to the Property that are not reflected by or contained within the
Reports. Lessor knows of no environmental conditions affecting the Property that are
not reflected by, discussed in or are not the subject of the Reports. Lessor has no
information, other than that contained in the Reports, regarding the environmental
condition of the Property. Lessee shall recognize and take proper precautions regarding
the environmental conditions noted in the Reports. The foregoing warranties and
representations shall survive the closing.
4
(B) If, after the date of Lease, it is discovered that there exists within
the Property environmental conditions which existed at the date of Lease which require
environmental remediation to render the Property in conformance with applicable local,
state or federal environmental laws or regulations, or as may be otherwise required to
permit Lessee's construction to proceed in a safe and timely manner without additional
cost, delay or harm to Lessee's employees, contractors or subcontractors
("Remediation" as defined herein), then Lessee shall notify Lessor of same as soon as
practicable and shall perform such Remediation; however, the cost and expense of
such Remediation will be paid by Lessor in accordance with the terms of this
paragraph.
(i) As used herein, the term "Remediation" shall mean those
response actions, including immediate and interim actions, taken to control, minimize,
restore or eliminate the discharge of hazardous substances or environmental pollution,
so that the hazardous substance or environmental pollution does not present an actual
or potential threat to public health, safety or welfare, or the environment, such action
being taken in accordance with all applicable laws, rules and regulations relating to the
same. The term also includes actions designed to prevent, minimize, stabilize or
eliminate the threat of discharge of hazardous substances, and actions to restore the
environment to the extent practical, and for the purpose of meeting all applicable
environmental laws, rules and regulations. Remediation shall include the cost of
removing and disposing of rubble and debris which is not environmentally
contaminated, and which does not require special disposal at a landfill qualified to take
environmentally sensitive material, but which is required in order to complete the
Remediation required of Lessor hereunder. All plans and costs for Remediation must
be pre-approved by the Lessor. To that end, Lessee shall submit to Lessor Lessee's
detailed plans for Remediation, and Lessee's bids, estimates or contracts, for
completion of the Remediation (the "Plans" and the "Bids"). The Lessor agrees that it
may only withhold approval of the Plans and Bids if in the reasonably exercised opinion
of the Lessor, it is determined that (a) such remediation is unnecessary, inappropriate
or not fully described, or (b) the Plans do not meet the requirements of applicable law
with respect to the problem to be remediated; or (c) the Plans will not accomplish the
goal of bringing the Property into compliance with applicable law; or (d) that the Bids
substantially exceed a bid or estimate for performing the Plans which the Lessor has
obtained from a reputable, third party contractor. Notwithstanding the foregoing or
anything else set forth herein, if the Lessor fails to approve of Lessee's Plans and Bids
on or before thirty (30) days after receipt of same, then the Plans and Bids are deemed
approved, the Lessee may proceed to perform the Remediation, and the Lessor shall
be liable for payment of all costs relating thereto in accordance with the terms of this
Section 7.5. Lessor is obligated to pay only for Remediation approved as set forth
herein, and the Lessor's obligation hereunder to undertake Remediation or reimburse
Lessee for Remediation inures only as a benefit to Lessee and is limited by the terms
and conditions of this Agreement. By so agreeing, the Lessor is not accepting,
expanding or admitting liability for any environmental condition that may exist on the
Property (except as specifically described herein) nor is the Lessor waiving any defense
to any claim of liability.
5
(ii) As used herein, the term "interim action" means a response
action taken to contain or stabilize a discharge of a hazardous substance, in order to
minimize any threats the public health, safety, or welfare, or the environment, while
other response actions are being undertaken or planned.
(iii) As used herein, the term "immediate action," means a
response action that is taken within a short period of time after the discovery of a
hazardous substance discharge or environmental pollution, in order to halt the
discharge, contain and remove discharged hazardous substances or remove
contaminated environmental media, in order to restore the environment to the extent
practical and to minimize the harmful affects of the discharge to air, lands and waters,
and to eliminate any imminent threat to public health, safety or welfare that may exist.
(iv) The Lessor shall pay all costs and expenses of all Remediation
whether now known or hereafter discovered, on the Property, including any immediate
or interim actions which are required to be taken in light of the environmental conditions
which may be existing or discovered during the course of the development of the
Property by Lessee. In the event Remediation which is the Lessor's obligation to pay
for, and which is undertaken by Lessee in accordance with the provisions of this
Section 7.5, shall cause a delay in completion of the Development of the Property by
Lessee, Lessee's performance of any obligations hereunder shall be extended for a
period of time equal to the delay caused by said Remediation. The Lessor agrees to
indemnify and hold Lessee harmless from and against any claims, costs, demands,
causes of action, fines or penalties, which may be assessed against Lessee on account
of or related to the existence of any environmental condition on the Property which is
the responsibility of the Lessor to remediate hereunder. This indemnification shall
extend to and include Lessee's actual costs and expenses incurred in connection with
any such matter, including but not limited to Lessee's actual attorney fees.
Notwithstanding anything else set forth herein, Lessor shall not be responsible for any
environmental condition requiring remediation which is directly caused, allowed or
acerbated by Lessee, its agents, contractors and employees, for which Lessee shall
indemnify Lessor and hold Lessor harmless from and against any claims, costs,
demands, causes or action, fines or penalties, which may be assessed against Lessor
on account of or related to any environmental condition caused, allowed or acerbated
by Lessee, its agents, contractors and employees on or flowing from the Property.
(v) Lessee must undertake all Remediation in compliance with
all applicable laws and provide Lessor with all correspondence related to approvals by
regulatory agencies.
6
(vi) If Lessee is required to undertake any Remediation, under the terms of this
Section 7.5, for which the Lessor is obligated to pay, then Lessee shall, on a periodic
basis, but not more than once every thirty (30) days, submit to Lessor a written request
for payment detailing the work performed since the commencement of the Remediation,
or the date of the last request for payment, together with a statement of all costs which
the Lessor is obligated to pay and the contractors, subcontractors and suppliers who
are to receive payment from Lessee on account of such work. The Lessor shall pay
Lessee the amount stated in the request for payment on or before thirty (30) days after
receipt of the request for payment. The Lessor may only refuse to pay a request for
payment if the request for payment contains costs or expenses for Remediation which
the Lessor is not obligated to pay in accordance with this Section 7.5. Any request for
payment which is not paid within the aforementioned time period shall bear interest at
the rate of twelve (12%) percent per annum from the date payment would otherwise be
due to the date of payment.
ARTICLE VIII
LOANS/GRANTS BY LESSOR
8. For and in consideration of Lessee's obligations hereunder to construct
Minimum Improvements, and in respect of the jobs that such Minimum Improvements
are expected to create, Lessor agrees to provide to Lessee the financial assistance (the
"Financial Assistance") and the construction assistance (the "Construction Assistance")
described in Exhibit "C," attached hereto and incorporated herein by reference.
ARTICLE IX
USE OF PROPERTY
9. Lessee will not use or allow the Property or any buildings or Improvements
thereon or any appurtenances thereto, to be used or occupied for any unlawful purpose
or in violation of any certificate of occupancy. Lessee will not suffer any act to be done
or any condition to exist within the Property or in any Improvement thereon, or permit
any article to be brought therein, which may be dangerous, unless safeguarded as
required by law, or which may, in law, constitute a nuisance, public or private, or which
may make void or voidable any insurance in force with respect thereto.
ARTICLE X
INSURANCE
10.1 Lessee shall provide and maintain or cause to be maintained at all times,
at its cost and expense, during the process of constructing Improvements (and, from
time to time at the request of City, furnish City with proof of payment of premiums on)
insurance as follows:
7
A. Builder's risk insurance as follows:
1. Named Insured: the City of Dubuque, Lessee, the general contractor
and any named or unnamed sub- or sub-subcontractors.
2. Covered Property: The Improvements, and the existing Brewery
building, including all fixtures, materials, supplies, machinery, and equipment to be used
in or incidental to the construction of the Improvements.
3. Covered Perils: All risks of physical loss including collapse, operation of
building ordinances or laws, mechanical breakdown, or electrical injury, testing,
earthquake, flood, sewer backup, and seepage.
4. Valuation: Replacement cost for the Improvements and on a function
basis for the replacement of the existing Brewery building with functionally equivalent
but less costly material if available.
5. Coverage Amount: The completed value of the Improvements,
including the value of the existing Brewery building.
B. Commercial General Liability insurance as set forth in the City's
standard Insurance Schedule for Lessees of City Property, as such uniform,
standardized schedule may from time to time be amended. The current Insurance
Schedule is attached to this Lease as Insurance Schedule A, Exhibit "C."
10.2 Upon completion of construction of Improvements, Lessee shall maintain,
or cause to be maintained at all times, at its cost and expense, (and, from time to time
at the request of City, shall furnish proof of the payment of premiums on) insurance as
follows:
A. Property insurance against loss and/or damage to Improvements
and the existing Brewery building under an insurance policy written on the Special
Perils Form in an amount not less than the full insurable replacement value of
Improvements and the existing Brewery building, but any such policy may have a
deductible amount of not more than $50,000.00. No policy of insurance shall be so
written that the proceeds thereof will produce less than the minimum coverage required
by the preceding sentence, by reason of co-insurance provisions or otherwise, without
the prior consent thereto in writing by City. Replacement value shall be determined
from time to time at the request of City, but not more frequently than once every three
years, and paid for by Lessee.
1. Named Insured: the City of Dubuque and Lessee.
2. Covered Property: The Improvements, and the existing Brewery
building, including all fixtures, materials, supplies, machinery, and equipment to be used
in or incidental to the construction of the Improvements.
3. Covered Perils: All risks of physical loss including collapse, operation of
building ordinances or laws, mechanical breakdown, or electrical injury, testing,
earthquake, flood, sewer backup, and seepage.
4. Valuation: Replacement cost for the Improvements and on a function
basis for the replacement of the existing Brewery building with functionally equivalent
but less costly material if available.
8
5. Coverage Amount: The completed value of the Improvements,
including the value of the existing Brewery building.
B.Commercial General Liability insurance as set forth in the City's
standard Insurance Schedule for Lessees of City Property, as such uniform,
standardized schedule may from time to time be amended. The current Insurance
Schedule is attached to this Lease as Insurance Schedule A, Exhibit "C."
10.3 All insurance required by this Article shall be taken out and maintained in
responsible insurance companies selected by Lessee which are authorized under the
laws of the State of Iowa to assume the risks covered thereby. Lessee shall deposit
annually with City copies of policies evidencing all such insurance, or a certificate or
certificates or binders of the respective insurers stating that such insurance is in force
and effect. Unless otherwise provided in this Section, each policy shall contain a
provision that the insurer shall not cancel or modify it without giving written notice to
Lessee and City at least thirty (30) days before the cancellation or modification
becomes effective. Lessee shall furnish City evidence satisfactory to City that the policy
has been renewed or replaced by another policy conforming to the provisions of this
Section, or that there is no necessity therefor under the terms hereof. In lieu of
separate policies, Lessee may maintain a single policy, or blanket or umbrella policies,
or a combination thereof, which provide the total coverage required herein, in which
event Lessee shall deposit with City a certificate or certificates of the respective
insurers as to the amount of coverage in force upon Improvements, provided, however,
the specific limit shall not be impaired.
10.4 Lessee agrees to notify City immediately in the case of damage
exceeding $50,000.00 in amount to, or destruction of, Improvements or any portion
thereof resulting from fire or other casualty. Net proceeds of any such insurance ("Net
Proceeds"), shall be paid directly to Lessee, and Lessee shall forthwith repair,
reconstruct and restore the Improvements to substantially the same or an improved
condition or value as they existed prior to the event causing such damage and, to the
extent necessary to accomplish such repair, reconstruction and restoration, Lessee
shall apply the Net Proceeds of any insurance relating to such damage received by
Lessee to the payment or reimbursement of the costs thereof, subject, however, to the
terms of any mortgage encumbering title to the Property.
10.5 Lessee shall complete the repair, reconstruction and restoration of
Improvements, whether or not the Net Proceeds of insurance received by Lessee for
such purposes are sufficient.
10.6 All rights of Lessor to receive or be paid insurance proceeds hereunder,
including but not limited to Section 10.4 above, are in all respects subject and
subordinate to the rights of any Holder, which rights are prior to the rights of Lessor.
9
ARTICLE XI
LESSOR'S WARRANTIES AND REPRESENTATIONS
11. Lessor's Representation Of Good Title. Lessor covenants and
warrants that its is lawfully seized in fee simple of the Property, and that it has full right
and authority to enter into this Lease for the full term hereof, and covenants and agrees
that upon paying the rent provided for herein, and upon Lessee's performing the
covenants and agreements of this Lease required to be performed by said Lessee, that
it will have, hold and enjoy quiet possession of the Property.
ARTICLE XII
INDEMNIFICATION
12. Indemnification of Lessor. Lessee will defend, indemnify, and save
harmless Lessor from and against all liabilities, obligations, claims, damages, penalties,
causes of action, costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses) imposed upon or incurred by or asserted against Lessor
by reason of (a) any accident, injury to, or death of persons or loss of or damage to
property occurring on or about the Property during the term of this Lease and resulting
from any act or omission of Lessee or anyone claiming by, through, or under Lessee
during the term of the Lease; and (b) any failure on the part of Lessee to perform or
comply with any of the terms of this Lease. In case any action, suit, or proceeding is
brought against Lessor by reason of such occurrence, Lessee will, at Lessee's
expense, resist and defend such action, suit, or proceeding, or cause the same to be
resisted and defended by counsel approved by Lessor.
ARTICLE XIII
ASSIGNMENT AND SUBLETTING
13. Lessee shall not assign or transfer this Lease or to sublease the whole or
any part of the Property without Lessor's consent, which consent will not be
unreasonably withheld.
10
ARTICLE XIV
DEFAULT
14. Lessor's Riahts in the Event of Lessee's Default. If Lessee shall fail or
neglect to observe, keep, or perform any of the covenants, terms, or conditions
contained in this Lease on its part to be observed, kept, or performed, and the default
shall continue for a period of thirty (30) days after written notice from Lessor setting
forth the nature of Lessee's default (it being" intended that in connection with a defauit
not susceptible of being cured with diligence within thirty (30) days, the time within
which Lessee has to cure the same shall be extended for such period as may be
necessary to complete the same with all due diligence), then and in any such event,
Lessor shall have the right at its option, on written notice to Lessee, to terminate this
Lease and all rights of Lessee under this Lease shall then cease. Lessor, without
further notice to Lessee, shall have the right immediately to enter and take possession
of the Property with or without process of law and to remove all personal property from
the Property and all persons occupying the Property and to use all necessary force
therefore and in all respects to take the actual, full, and exclusive possession of the
Property and every part of the Property as of Lessor's original estate, without incurring
any liability to Lessee or to any persons occupying or using the Property for any
damage caused or sustained by reason of such entry on the Property or the removal of
persons or property from the Property.
ARTICLE XV
RIGHT TO CURE OTHER'S DEFAULTS
15. Whenever and as often as a party shall fail or neglect to comply with and
perform any term, covenant, condition, or agreement to be complied with or performed
by such party hereunder, then, upon thirty (30) days' prior written notice to such
defaulting party, the other party, at such other party's option, in addition to all other
remedies available to such other party, may perform, or cause to be performed, such
work, labor, services, acts, or things, and take such other steps, including entry onto the
Property and the Improvements thereon, as such other party may deem advisable, to
comply with and perform any such term, covenant, condition, or agreement which is in
default, in which event such defaulting party shall reimburse such other party upon
demand, and from time to time, for all costs and expenses suffered or incurred by such
other party in so complying with or performing such term, covenant, condition, or
agreement. The commencement of any work or the taking of any other steps or
performance of any other act by such other party pursuant to the immediately preceding
sentence shall not be deemed to obligate such other party to complete the curing of any
term, covenant, condition, or agreement which is in default.
11
ARTICLE XVI
QUIET ENJOYMENT
16.1 Lessor covenants that at all times during the term of this Lease, so long as
Lessee is not in default hereunder, Lessee's quiet enjoyment of the Property or any part
thereof shall not be disturbed by any act of Lessor, or of anyone acting by, through, or
under Lessor.
16.2 Notwithstanding the foregoing, Lessor reserves the right upon reasonable
notice to Lessee to enter the Property for purposes of testing, sampling, surveying,
environmental remediation, and other similar purposes so long as such activities do not
unreasonably interfere with Lessee's use of the Property.
ARTICLE XVII
WAIVER
17. No waiver by Lessor of any breach by Lessee of any term, covenant,
condition, or agreement herein and no failure by Lessor to exercise any right or remedy
in respect of any breach hereunder, shall constitute a waiver or relinquishment for the
future of any such term, covenant, condition, or agreement or of any subsequent
breach of any such term, covenant, condition, or agreement, nor bar any right or
remedy of Lessor in respect of any such subsequent breach, nor shall the receipt of any
rent, or any portion thereof, by Lessor, operate as a waiver of the rights of Lessor to
enforce the payment of any other rent then or thereafter in default, or to terminate this
Lease, or to recover the Property, or to invoke any other appropriate remedy which
Lessor may select as herein or by law provided.
ARTICLE XVIII
SURRENDER
18. Lessee shall, on the last day of the term of this Lease or upon any
termination of this Lease hereof, surrender and deliver up the Property, with the
improvements then located thereon into the possession and use of Lessor, without
fraud or delay and in good order, condition, and repair, free and clear of alilettings and
occupancies, free and clear of all liens and encumbrances other than those existing on
the date of this Lease and those, if any, created by Lessor, without (except as
otherwise provided herein) any payment or allowance whatever by Lessor on account of
or for any buildings and improvements erected or maintained on the Property at the
time of the surrender, or for the contents thereof or appurtenances thereto.
12
ARTICLE XIX
NOTICES
19.1. All notices, demands, or other writings in this Lease provided to be given
or made or sent, or which may be given or made or sent, by either party to the other,
shall be deemed to have been fully given or made or sent when made in writing and
deposited in the United States mail, registered and postage prepaid, and addressed as
follows:
TO LESSOR:
City of Dubuque, Iowa
Ci~Hall
13 and Central Avenue
Dubuque IA 52001
Attn: City Manager
TO LESSEE:
Historic Star Redevelopment LLC.
145 East Badger Road
Madison, Wisconsin 53713
Attn: Managing Member
19.2. The address to which any notice, demand, or other writing may be given
or made or sent to any party as above provided may be changed by written notice given
by the party as above provided.
ARTICLE XX
MISCELLANEOUS
20.1. Time of the Essence. Time is of the essence of this Lease and all of its
provisions.
20.2. Governina Law. It is agreed that this Lease shall be governed by,
construed, and enforced in accordance with the laws of the State of Iowa.
20.3. Paraaraph Headinas. The titles to the paragraphs of this Lease are
solely for the convenience of the parties and shall not be used to explain, modify,
simplify, or aid in the interpretation of the provisions of this Lease.
20.4. Modification of Lease. Any modification of this Lease or additional
obligation assumed by either party in connection with this Lease shall be binding only if
evidenced in a writing signed by each party or an authorized representative of each
party.
13
20.5. Parties Bound. This Lease shall be binding on and shall inure to the
benefit of and shall apply to the respective successors and assigns of Lessor and
Lessee. All references in this Lease to "Lessor" or "Lessee" shall be deemed to refer to
and include successors and assigns of Lessor or Lessee without specific mention of
such successors or assigns.
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be executed
as of the day and year first above written.
LESSOR:
[SEAL]
CITY OF DUBUQUE, IOWA
Attest: By:
Jeanne F. Schneider, City Clerk Terrance M. Duggan, Mayor
LESSEE:
Historic Star Redevelopment LLC.
By:
Randy Alexander, President of the Alexander Company, Inc
It's Managing Member
14
EXHIBIT "A"
LEGAL DESCRIPTION OF THE PROPERTY
That part of Lot 2 of Riverwalk 5th Addition in the City of Dubuque shown on
Exhibit AA attached hereto.
-~_.~,,~ .=~_.~ ----
~
-"-",""'-"""'"'"
. ~..i'~~~~oii:"""
. ......, ," """ -- U><= >Om>
.. ~=.t":;'.,""
0 ¡:P:X:H<>~~
.. '" """ ~ """""".
" "',"'m""""""-AS=
¡ ,""""""""""'-
._o.~ """!--OF-"'"
"'- =-
~~
~.I.
-s:
CfW'H", SCALE.
0 '00 200
i....---i---i
("' FŒT)
D.'- WAY H"IE """" REDI.>ŒD
~~ ~
( ¡ . .
"- ...
'4=
I
I
.~--o . J
".. ~~
.~Ii~ f'~.. ~
~~.".
,...
-
-=
--,,-
~\
~,
~ L- - ~~~,.;;¡.",.~.:.:~
~.-r-~--- // L :i=-~,'>-..
~ - t;;-""""";;;--==-= -=:Ì = = =
0 ~............
. ""'_......,
i- -f "'~ - - - - - - - - - -
5: ~, .""'-""- !JeT-^'" " ~ .".
j'! .<._~,
~
¡¡
g
.
15
\
\
\
~
\
,
\
EXHIBIT "B"
MINIMUM IMPROVEMENTS
General Conditions, Supervision, Insurance $ 60,000.00
Building Demolition, Removals, Disposal Costs $375,000.00
Carpentry, Temporary Enclosures $ 25,000.00
Structural Repair & RoofReplacement @ Skylight
Roof $ 25,000.00
Temporary Lighting $ 10,000.00
Interior Brick Sandblasting - Walls & Ceilings $ 60,000.00
Exterior Brick Cleaning, Tuck Pointing, Patching $125,000.00
Design Fee $ 50,000.00
Construction Fee $ 40,000.00
Contingency $ 10,000.00
National Register NominationlHist. Tax
Certification
Total Preliminary Phase Cost
$ 20.000.00
$800,000.00
16
EXHIBIT "C"
DESCRIPTION OF FINANCIAL ASSISTANCE AND CONSTRUCTION ASSISTANCE
Description of Financial Assistance and Construction Assistance
City shall make the following Financial Assistance and Construction Assistance
incentives available to Developer for the purpose of funding Minimum Improvements on
Property:
Community Development Block Grant Loan of $650,000 for 1 year at 0% interest with
balloon payment, and a Star Brewery Construction Loan of $150,000 to be used by the
Developer for the sole purpose of rehabilitation of Property, subject to and in accordance with
the terms of CDBG Commercial/lndustrial Building Rehabilitation Loan #1-04 in the form
attached hereto as Exhibit C.1 and by this reference made a part hereof.
All such financing and the terms of the foregoing loan agreements shall be subject in all
respects to compliance with the applicable loan or grant program requirements and the
covenants and conditions set forth in this Agreement and with State and Federal law, including
the holding of public hearings thereof, and may contain terms and covenants that are different
from those contained in this Agreement. All such loan agreements shall represent separate
obligations of the parties thereto and shall be construed and enforced as provided therein.
17
Exhibit C.1
City of Dubuque, Iowa
CDBG
COMMERCIAUINDUSTRIAL BUILDING REHABILITATION
LOAN AGREEMENT
NUMBER: CDBG #1-04
This AGREEMENT, dated as of the 16th day of March, 2004 is entered into by and
between the CITY OF DUBUQUE, IOWA, a municipal corporation organized and existing under
the laws of the State of Iowa (hereinafter referred to as the "City") and Historic Star
Redevelopment, LLC, a Wisconsin limited liability company with its principal place of business
in Madison, Wisconsin, (hereinafter referred to as the "Company").
WITNESSETH:
WHEREAS, the Star Brewery Building, Dubuque, Iowa, (hereinafter referred to as the
"Building") is located within the boundaries of City's low and moderate income area; and
WHEREAS, the objective of City's Commercialllndustrial Building Rehabilitation Loan
Program is to provide financial assistance for the rehabilitation of commercial and industrial
building exteriors and the elimination of code deficiencies in an effort to stimulate reinvestment
and reuse of properties in City's low and moderate income area; and
WHEREAS, the Building, in its current condition, has been found by City to be in a state
of physical deterioration and code deficiency; and
WHEREAS, City desires to encourage Company in its efforts to bring said Building into
compliance with local codes and ordinances and to eliminate certain conditions of physical
deterioration; and
WHEREAS, the redevelopment of the Property is an economic development project
involving private and public investment and the creation of new jobs and income; and
WHEREAS, without the Loan Program, Company may be unable to rehabilitate the
Building, thereby continuing a blighting influence and health and safety problem in City; and
WHEREAS, City is a participating city in the Community Development Block Grant
Program of the United States Department of Housing and Urban Development.
NOW THEREFORE, in consideration of the promises and respective covenants,
agreements and representations hereinafter set forth, the parties agree as follows:
18
1. SOURCE OF FUNDS. City, pursuant to its Grant Agreements with the United
States Department of Housing and Urban Development, has obtained Letters of Credit from the
Department of Housing and Urban Development, issued by the United States Treasury for six
hundred fifty thousand dollars ($650,000) and has allocated funds of one hundred fifty thousand
dollars ($150,000) sufficient to carry out its obligations under this Agreement.
2. LOAN TERMS. City agrees to make a Nonrecourse Loan to Company on the
terms and conditions set forth herein for eight hundred thousand dollars ($800,000.00). The
term of the loan shall be one (1) year. There will be no principal or interest payments or
accruals for this one-year. At the end of the attached one-year lease agreement, if the
Company has completed the Minimum Improvements identified in the attached lease, the entire
loan terms may be renegotiated and assigned subject to the terms and conditions of a
Development Agreement mutually agreed upon by both parties. .
At the time of the initial disbursement of loan funds to Company, Company shall execute
the Promissory Note in the form attached hereto as Exhibit A payable to the order of City in the
principal amount of eight hundred thousand dollars ($800,000.00).
3. DISBURSEMENT AND USE OF LOAN FUNDS. Loan funds shall be disbursed
to Company by City for Qualifying Project Expenses, defined in Paragraph 27(d), for amounts
not to exceed to the total sum of $800,000.00.
Company shall fumish to City written requests for disbursement of loan funds. Such
requests shall be accompanied by a statement of Company's Qualifying Project Expenses and
appropriate documentation of such expenses. It is expressly understood that all funds
dispersed under this Agreement shall be used by Company only for the purpose of paying the
reimbursement for Qualifying Project Expenses set forth in such written requests.
Company shall complete the Project, defined in Paragraph 27(c), in accordance with the
terms of this Agreement within six (6) months of the date of this Agreement. City shall not be
obligated to pay any funds not drawn by Company after said date.
4.
SECURITY. This loan shall be secured by improvements made to the Property.
5. STATUS OF COMPANY. Company represents that it is a limited liability
company duly organized and existing under the laws of the State of Wisconsin; that it is
authorized to borrow under this Agreement and to execute and deliver the Note and otherwise
perform the obligations of this Agreement; that it has corporate authority and power to own its
property and conduct its business as it is currently carried on; that the performance of its
obligations under this Agreement and the issuance of any note under it will not conflict with any
provision of law, or any operating agreement of Company, or any agreement binding on it.
Company also represents, except as disclosed in writing to City, that it is not a party to any
pending or threatened litigation or to any proceeding or action for the assessment or collection
of additional taxes, and that it knows of no known contingent liabilities not provided for or
disclosed in the financial statement provided City which would affect the ability of the Company
to repay this loan.
19
6. FINANCIAL CONDITION OF COMPANY. Company has delivered to City a
statement of Company's financial condition as of the date of application for financial assistance
which fairly represents the financial condition of Company as of the date stated, all in
accordance with generally accepted accounting principles consistently applied, and that the
statements correctly reflect the financial condition and status of its operations as of the date of
this Agreement. Company agrees to promptly notify City of any material change in Company's
financial condition.
7. TITLE OF COMPANY. Except as otherwise disclosed in writing to City,
Company represents that it has good and marketable title, free of any mortgage, pledge, lien,
security interest, encumbrance, or charge to all those assets reflected on the financial
statement and to assets since acquired. Taxes not due or payable or otherwise delinquent are
excepted, as are assets disposed of in the ordinary course of business.
8. CONDITIONS OF BORROWING. On the date on which any sum is to be
borrowed, Company, in addition to the Note, shall deliver to City such other papers and
documents as may be required to comply with the conditions of this Agreement.
Company makes the following warranties and representations, all of which are true and
correct as of the date hereof, and all of which shall be true and correct as of the date of any
disbursement of any loan funds hereunder:
(a)
(b)
(c)
(d)
(e)
(f)
That the representations and warranties of Company are correct on such Date;
That Company has fully complied with the covenants and agreements to the
extent required before such Date;
That no default or event which might mature into a default has occurred or
continues to such Date;
That no litigation or proceeding is pending against Company which would
materially affect the assets of Company. taking into account the entire assets
and overall business of Company;
That there has been no material adverse change in the financial condition of
Company from that shown by the financial statement delivered to City under
Paragraph 6;
That since the Closing Date, no fire or casualty has occurred in any building or to
any inventories or property of Company that might substantially adversely affect
the conduct of its business.
9. SPECIAL CONDITIONS. Company will comply with all requirements imposed
upon a Grantee of the City under its Community Development Block Grant Agreement
including, without limitation, the requirements of 24 CFR Part 570.
20
10. COVENANTS OF COMPANY. Company covenants that until any sums
borrowed under this Agreement are paid in full, it will, unless City agrees in writing to a
modification or otherwise stated herein:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
0)
Correct all code deficiencies in accordance with all applicable building and fire
codes within the scope of the project.
Provide for the repair and rehabilitation of the Building in accordance with all
applicable building, zoning, fire and housing codes as applicable.
Substantially complete the Project within six (6) months from the Closing Date.
Maintain at all times insurance to the extent and against such hazards and
liabilities as are in keeping with the current insurance program of Company, set
forth in the attached Lease Agreement.
Pay when due all taxes, assessments and other liabilities, except those
contested in good faith where notice of such contest has been given to the City.
Not create or permit to exist any other mortgage, pledge, security interest, lien or
other encumbrance on the security for this Agreement provided in Paragraph 4
above and the Note provided pursuant to this Loan Agreement without written
consent of City.
Give prompt notice in writing to City of any adverse development, financial or
otherwise, which would materially affect its business, properties or affairs, or the
ability of Company to perform its obligations under this Agreement or the Note
executed pursuant to the terms of this Agreement.
Use loan funds only for purposes authorized herein.
Take no action that would cause City to be found in default under its Community
Development Block Grant Agreement.
Pay all fees, expenses and charges in respect to this Agreement or its making in
any way connected therewith including, but not limited to, legal fees, abstract
continuation, recording and filing fees, mortgage taxes, documentary stamps,
and any other taxes, fees and expenses payable in connection with this
transaction. Nothing herein shall obligate company to pay City's attorney fees
incurred in connection with this Agreement.
21
11. DEFAULT. Company shall be in default upon the occurrence of any of the
following events:
(a)
(b)
(c)
(d)
Company becomes insolvent or admits in writing its inability to pay its debts as
they mature; or applies for, consents to or acquiesces in the appointment of a
trustee or receiver for any of its property; or in the absence of an application for
consent or acquiescence, a trustee or receiver is appointed for it or a substantial
part of its property and is not discharged within thirty (30) days; or it otherwise
commits an act of bankruptcy; or any bankruptcy, reorganization, debt
arrangement or other proceeding under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding is instituted by or against it and if instituted
is consented to or acquiesced in by it or remains for thirty (30) days
undismissed;
Company fails in the performance of any of the terms and conditions of this
Agreement and such non-performance continues for thirty (30) days after written
notice thereof from City or from the holder of a note;
Any warranty made by Company is untrue in any material respect, or any
schedule, statement, report, notice or writing furnished by Company to City is
untrue in any material respect on the date as of which the facts set forth are
stated or certified, provided any such error is not the result of unintentional errors
which are capable of correction without prejudice to the City;
Any govemment board, agency, department, commission or public or private
lender takes possession or control of any substantial part of any property of
Company and such possession or control continues for thirty (30) days.
12. ACCELERATION AT OPTION OF CITY. If any default occurs and Company
fails to correct such default within thirty (30) days after written notice of such default by City,
City may declare Note immediately due and payable, at which time all unpaid principal and
interest shall immediately become due and payable. City shall promptly advise Company in
writing of any acceleration under this paragraph, but the failure to do so shall not impair the
effect of such declaration.
13. MAINTENANCE OF RECORDS AND RIGHT TO INSPECT. Company shall
keep and maintain normal business books and records and all other documents, invoices and
receipts relating directly to the receipt and disbursement of loan funds; and any duly authorized
independent accounting representative of City, or the Comptroller General of the United States,
shall at all reasonable times have access to and the right to inspect, copy, audit and examine all
such books and other documents of Company pertaining to the project until the completion of
all close out procedures respecting City's loan and the final settlement and conclusion of all
issues arising out of said loan.
22
14.
ADDRESS. Company's principal business address is:
Historic Star Redevelopment, LLC.
145 E. Badger Road, Suite 200
Madison, Wisconsin 53713
Company shall promptly give City written notice of any further change in its principal
office address. City's address is:
Economic Development Department
City Hall
50 West 13th Street
Dubuque, Iowa 52001
15. ACCESS TO PROJECT. Company agrees that any duly authorized
representative of City or of the United States shall at all reasonable times have access to any
portion of the project until the completion of all close-out procedures respecting the Community
Development Block Grant Loan.
16. LIMITATION OF CITY'S LIABILITY FOR PROJECT ACTIVITIES. City shall not
be liable to Company, or to any person, for the completion of, or the failure to complete, any
activities that are part of the Project, except as may be specifically provided in this Agreement
or other written agreements between City and Company. Company agrees to indemnify, hold
harmless and defend City from any such claims against City.
17. CONFLICT OF INTEREST. Company certifies that to its knowledge no member,
officer or employee of City, or its designees or agents, nor any consultant or member of the
goveming body of City, and no other public official of City who exercises or has exercised any
functions or responsibilities with respect to the Project during his or her tenure, or who is in a
position to participate in a decision making process or gain inside information with regard to the
Project, has nor shall have any interest, direct or indirect, in any contract or subcontract, or in
any activity, or benefit therefrom, which is part of this Project at any time during or for one year
after such person's tenure.
18. NONDISCRIMINATION. In carrying out the Project, Company shall not
discriminate against any employee or applicant for employment or tenancy because of race,
religion, color, sex, national origin, age or disability. Company shall post in a conspicuous
place, available to employees and applicants for employment, notices to be provided by City
setting forth the provisions of this nondiscrimination clause. Company shall state that all
qualified applicants will receive consideration for employment without regard to race, religion,
color, sex, national origin, age or disability.
19. NO ASSIGNMENT OR SUCCESSION. Company acknowledges and agrees
that no transfer of loan funds by City to Company shall be deemed an assignment of loan
funds, and Company shall not succeed to any rights, benefits or advantages of City authorities
or interests in or under the Loan Agreement.
23
20. DISCLAIMER OF RELATIONSHIPS. Nothing contained in this Agreement
between the parties, nor any act of City or Company shall be deemed or construed by any of
the parties, or by any third persons, to create any relationship of third party beneficiary, principal
or agent, limited or general partnership, or joint venture, or of any association or relationship
involving the United States.
21. NOTICE. Any notice required under this Agreement if mailed by United States
certified mail, shall be deemed given when mailed, postage prepaid, addressed to the other
party at its address shown above, or at any other address subsequently designated by either
party to the other.
22. SUCCESSORS AND ASSIGNS. All covenants, representations, warranties and
agreements herein set forth shall be binding upon Company, and its legal representatives,
successors and assigns. This Agreement may not be assigned by City or Company without the
express written consent of the other party. Consent of such assignment shall not be
unreasonably withheld.
23. LEGALITY. If any provision of this Agreement shall, for any reason, be held to
be invalid or unenforceable, such invalidity or unenforceability shall not affect any other
provision hereof, but this Agreement shall be construed as if such invalid or unenforceable
provision had never been contained herein.
24. GOVERNING LAW. This Agreement and all rights and duties hereunder,
including but not limited to all matters of construction, validity and performance shall be
govemed by the laws of the State of Iowa.
25. SURVIVAL OF REPRESENTATIONS. All representations or warranties of
Company shall survive the execution and delivery of this Agreement and any notes or
mortgages executed and delivered under it, and no investigation by City nor any closing shall
affect the representations or warranties or the right of City to rely on and enforce them.
26. DELAY. No delay on the part of City or the holder of any note in the exercise of
any right shall operate as a waiver, nor shall any single or partial exercise of any right preclude
other or additional exercise of any right.
27.
DEFINITIONS.
(a)
"Closing Date" shall mean the date on which this Agreement is executed by the
parties.
(b)
"Grant Agreement" shall mean that Community Development Block Grant
Agreement entered into by City and the United States Department of Housing
and Urban Development.
(c)
"Project" shall mean the rehabilitation of the Star Brewery Building and code-
compliance activities.
24
(d)
"Qualifying Project Expenses" shall mean those expenditures or expenses
incurred by Company during and for the Project, whether paid to third parties or
incurred as wage expense, fringe benefit expense or other costs of Company's
employees, agents and contractors.
Dated this 16th day of March, 2004.
CITY OF DUBUQUE, IOWA
Historic Star Redevelopment, LLC
Michael C. Van Milligen, City Manager
Randall P. Alexander, President of The
Alexander Company, Inc
Its, Managing Member
25
EXHIBIT "D"
INSURANCE SCHEDULE A
INSURANCE REQUIREMENTS FOR TENANTS AND LESSEES OF CITY PROPERTY
OR VENDORS (SUPPLIERS, SERVICE PROVIDERS) TO THE CITY OF DUBUQUE
1. All policies of insurance required hereunder shall be with an insurer authorized to
do business in Iowa. All insurers shall have a rating of A of better in the current
AM. Best Rating Guide.
2. All policies of insurance shall be endorsed to provide a thirty (30) day advance
notice of cancellation to the City of Dubuque if cancellation is prior to the
expiration date. This endorsement supersedes the standard cancellation
statement on the Certificate of Insurance.
3.
shall furnish a Certificate of Insurance to the City of Dubuque, Iowa
for the coverage required in Paragraph 6 below. Such certificates shall include copies of the
following policy endorsements:
a) Thirty day notice of cancellation to the City of Dubuque.
b) Commercial General Liability policy is primary and non-contributing.
c) Commercial General Liability additional insured endorsement.
d) Governmental Immunity Endorsements.
e) Waiver of recovery under workers compensation.
4. Each certificate shall be submitted to the contracting department of the City of Dubuque.
5. Failure to provide minimum coverage shall not be deemed a waiver of these requirements by the
City of Dubuque. Failure to obtain or maintain the required insurance shall be considered a
material breach of this agreement.
6. shall be required to carry the following minimum coveragellimits or
greater if required by law or other legal agreement
a) COMMERCIAL GENERAL LIABILITY
General Aggregate Limit
Products-Completed Operations Aggregate Limit
Personal and Advertising Injury Limit
Each Occurrence Limit
Fire Damage Limit (anyone occurrence)
Medical Payments
$2,000,000
$1,000,000
$1,000,000
$1,000,000
$ 50,000
$ 5,000
This coverage shall be written on an occurrence, not claims made, form
per location. All deviations or exclusions from the standard ISO
commercial general liability form CG 0001 or Businessowners form BP
0002 shall be clearly identified.
Govemmentallmmunity Endorsement identical or equivalent to form attached.
26
An additional insured endorsement identicai or equivalent to ISO Form CG 2026 or CG
2011 and include as additional insureds: "The City of Dubuque, including all its elected
and appointed officials, all its employees and volunteers, all its boards. commissions
and/or authorities and their board members, employees, and volunteers."
b) WORKERS' COMPENSATION & EMPLOYERS LIABILITY
Statutory for Coverage A
Employers Liability:
$100,000 each accident
$100,000 each employee-disease
$500,000 policy limit-disease
Policy shall include an endorsement waiving right of recovery against City of
Dubuque.
c)
UMBRELLA/EXCESS LIABILITY
LIQUOR OR DRAM SHOP LIABILITY
basis by Finance Director.
Coverage to be determined on a case-by-case
POLICY NUMBER
COMMERCIAL GENERAL LIABILITY
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.
ADDITIONAL INSURED - DESIGNATED PERSON OR
ORGANIZATION
This endorsement modifies insurance provided under the following:
COMMERCIAL GENERAL LIABILITY COVERAGE PART.
SCHEDULE
Name of Person Or Organization:
The City of Dubuque, including all its elected and appointed officials, all its employees and volunteers, all
its boards, commissions and/or authorities and their board members, employees, and volunteers.
1.
(If no entry appears above, information required to complete this endorsement will be shown in the
Declarations as applicable to this endorsement)
WHO IS AN INSURED (Section II) is amended to include as an insured the person or organization shown
27
in the Schedule as an insured but only with respect to liability arising out of your operations or premises
owned by or rented to you.
Cooyri9ht. Insurance Services Office. Inc. 1994
CG20261185
2.
CITY OF DUBUQUE, IOWA
GOVERNMENTAL IMMUNITIES ENDORSEMENT
1.
Nonwaiver of Governmentallmmunitv. The insurance carrier expressly agrees and states that the
purchase of this policy and the including of the City of Dubuque, Iowa as an Additional Insured does
not waive any of the defenses of governmental immunity available to the City of Dubuque, Iowa under
Code of Iowa Section 670.4 as it is now exists and as it may be amended from time to time.
2.
Claims CoveraQe. The insurance carrier further agrees that this policy of insurance shall cover only
those claims not subject to the defense of governmental immunity under the Code of Iowa Section
670.4 as it now exists and as it may be amended from time to time. Those claims not subject to Code
of Iowa Section 670.4 shall be covered by the terms and conditions of this insurance policy.
3.
Assertion of Government Immunity. The City of Dubuque, Iowa shall be responsible for asserting any
defense of governmental immunity, and may do so at any time and shall do so upon the timely written
request of the insurance carrier.
4.
Non-Denial of Coveraae. The insurance carrier shall not deny coverage under this policy and the
insurance carrier shall not deny any of the rights and benefits accruing to the City of Dubuque, Iowa
under this policy for reasons of governmental immunity unless and until a court of competent
jurisdiction has ruled in favor of the defense(s) of governmental immunity asserted by the City of
Dubuque, Iowa.
No Other Chanae in Policv. The above preservation of governmental immunities shall not otherwise
change or alter the coverage available under the policy.
F:\USERS\WBaum\Lease Agreement for MVM and Council review.doc
28