Amendment to Platinum Holdings, LLC Development Agreement
RESOLUTION NO. ~-OO
A RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF AN
AMENDED AND RESTATED DEVELOPMENT AGREEMENT BY AND
BETWEEN THE CITY OF DUBUQUE AND PLATINUM HOLDINGS, LLC.
Whereas, this Council, on June 19,2000 approved and authorized execution of a Development
Agreement with Platinum Hospitality Group, LLC (the Former Developer); and
Whereas, the parties now desire to amend the Development Agreement as set forth in the
attached Amended and Restated Development Agreement so as to, among other things, provide for a
name change of Developer, modification of certain language related to an environmental no- action
letter, references to the convention center and clarification of the Minimum Assessment Agreement
tax years.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
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Section I. That the attached Amended and Restated Development Agreement by and
between the City of Dubuque, Iowa and Platinum Holdings, LLC is in the public interest of the citizens
of the City of Dubuque and in furtherance of the Ice Harbor Urban Renewal Plan, and is hereby
approved.
Section 2. That the Mayor is hereby authorized and directed to execute said Amended and
Restated Development Agreement on behalf of the City and the City Clerk is authorized and directed
to attest to his signature.
Passed, approved and adopted this 21 st day of August, 2000.
Terrance M. Duggan
Mayor
Attest:
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CITY OF DUBUQUE, IOWA
MEMORANDUM
August 1 7, 2000
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Amended and Restated Development Agreement with Platinum
Holdings, LLC (formerly Platinum Hospitality Group, LLC)
Community and Economic Development Director Jim Burke is recommending
approval of minor amendments to the Development Agreement and Lease for the
Ice Harbor Urban Renewal District project. The main change is the name, Platinum
Hospitality Group, LLC is now Platinum Holdings, LLC.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
MCVM/dd
Attachment
cc: Barry Lindahl, Corporation Counsel
Tim Moerman, Assistant City Manager
Jim Burke, Community and Economic Development Director
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CITY OF DUBUQUE, IOWA
MEMORANDUM
August 16, 2000
TO:
FROM:
s Burke, Community and Economic Development Director
SUBJ:
Amended and Restated Development Agreement with Platinum Holdings, LLC
(formerly Platinum Hospitality Group, LLC)
INTRODUCTION
This memorandum presents for City Council consideration a resolution approving and authorizing
execution of an amended and restated Development Agreement by and between the City and Platinum
Holdings, LLC , formerly Platinum Hospitality Group, LLC (the Developer). The amendment has
been requested by the Developer to reflect a name change in the LLC that will develop the hotel
complex and to make other minor modifications.
DISCUSSION
On June 19,2000, the City Council approved a Development Agreement with Platinum Hospitality
Group, LLC. The Agreement sets out the terms and conditions of the lease and development of land
in the Ice Harbor for a hotel/water park complex. The amended and restated Development Agreement
changes the name of the Developer to "Platinum Holdings, LLC" and clarifies language regarding an
environmental "no-action letter". Neither change affects the basic form or content of the
Development Agreement. City staff has also suggested that the term "convention center" be revised
to "conference and education center" to reflect the latest changes in that project's status regarding
application for Vision Iowa funds.
The Minimum Assessment Agreement will also be revised to reflect the name change and to clarify
the tax years under which the agreement is subject.
RECOMMENDATION
I recommend that the City Council approve the attached amended and restated Development
Agreement by and between the City and Platinum Hospitality Group, LLC and authorize and direct
the Mayor and City Clerk to sign on behalf of the City of Dubuque.
ACTION STEP
The action step is for the City Council to approve the attached resolution.
attachments
August 16,2000
F:\USERSIPmyhreIWPDOCS\URllce Harborlamendlmemo. wpd
AMENDMENT
TO
DEVELOPMENT AGREEMENT
THIS AMENDMENT (the "Amendment"), made and executed as of this 15"' day of January, 2001, by and between
the CITY OF DUBUQUE, IOWA, a municipality (the "City"), established pursuant to the Code of Iowa of the State of Iowa
and acting under authorization of Chapter 403 of the Code of Iowa, as amended (the "Urban Renewal Act") and PLATINUM
HOLDINGS, LLC, an Iowa limited liability company, with its principal place of business in Dubuque, Iowa (the "Developer").
WITNESSETH:
WHEREAS, the above -identified parties have executed a certain Development Agreement dated June 19, 2000, ( the
"Development Agreement"), pertaining to, inter alio, the purchase, sale, development and use of certain real property located in
the City of Dubuque, County of Dubuque, State of Iowa (the "Property"); and
WHEREAS, due to unforeseen circumstances and delays, the parties were unable to satisfy all conditions and
requirements related to the Development Agreement; and
WHEREAS, the parties desire to amend the Development Agreement to satisfy various conditions.
NOW, THEREFORE, in consideration of the Development Agreement, the foregoing recitals, the mutual covenants,
terms and conditions hereinafter set forth and other valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, the City and Developer do hereby agree to modify, amend and supplement the Development Agreement,
including all of its attachrnents (the Lease, the Facility Management Agreement and the Parking Use Agreement), as provided in
the attached Amended Development Agreement.
The parties hereby ratify and reaffnin all terms and conditions of the Development Agreement which are not expressly
modified, amended or supplemented and acknowledge and agree that the Development Agreement, as modified, amended and
supplemented, shall be and hereby is reinstated and shall continue in full force and effect for the duration and the extent therein
provided.
IN WITNESS WHEREOF, the parties have caused this Amendment to Development Agreement to be executed by
their respective duly authorized officers or representatives as of the date and year first above written
CITY OF DUBUQUE, IOWA
(the "City")
by:
bv:
T rrance M. Duggan, Mayo
PLATINUM HOLDINGS, LLC
(the "Developer")
b
Jaynes P. Rix
ief Exe utive Officer
A124 LC t✓ t / ?/tom `t- by:
Jeanne F. Schneider, City Clerk
F:\USERS\Pmyhre\WPDOCS\UR\Ice Harbor\amend l.wpd
January 11, 2001 (1:52pm)
onald Iverson, Member
CITY OF DUBUQUE, IOWA
DEVELOPMENT AGREEMENT
AGREEMENT, made on or as of the l day of
2000, by and between the City of
Dubuque, Iowa, a municipality (hereinafter called "CITY"), established pursuant to the Code of Iowa of the
State of Iowa and acting under authorization of Chapter 403 of the Code of Iowa, as amended
(hereinafter called "URBAN RENEWAL ACT") and Platinum Holdings, LLC (hereinafter called
"DEVELOPER").
WITNESSETH:
WHEREAS, in furtherance of the objectives of the Urban Renewal Act, City has undertaken an
Urban Renewal project (hereinafter called "PROJECT") to advance the community's ongoing economic
development efforts; and
WHEREAS, said Project is located within the Ice Harbor Urban Renewal District (hereinafter
called "PROJECT AREA"); and
WHEREAS, as of the date of this Agreement there has been prepared and approved by City an
Urban Renewal Plan for the Project Area consisting of the Urban Renewal Plan approved by City Council
of City on the 5th of June, 2000 (attached hereto as Exhibit A and hereinafter called "URBAN RENEWAL
PLAN"); and
WHEREAS, a copy of the Urban Renewal Plan, as constituted on the date of this Agreement, has
been recorded among the land records in the office of the Recorder of Dubuque County, Iowa; and
WHEREAS, Developer has requested that City acquire and lease to Developer approximately 5
acres located in the Project Area as more specifically identified on Exhibit B attached hereto (hereinafter
called "PROPERTY") so that Developer may redevelop said Property, located in the Project Area, for and
in accordance with the uses specified in the Urban Renewal Plan and in accordance with this Agreement;
and
WHEREAS, City believes that the redevelopment of Property pursuant to this Agreement, and the
fulfillment generally of this Agreement, are in the vital and best interests of City and in accord with the
public purposes and provisions of the applicable federal, state and local laws and the requirements under
which the Project has been undertaken and is being assisted; and
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WHEREAS, this Development Agreement is exempt from the competitive bidding procedures of
Iowa Code Section 403.8(2) as a result of the agreement of Developer to enter into a minimum
assessment agreement as provided in Iowa Code Section 403.6 and the development of home/regional
offices of a multistate business at the Property.
NOW THEREFORE, in consideration of the premises and the mutual obligations of the parties
hereto, each of them does hereby covenant and agree with the other as follows:
SECTION 1. ACQUISITION OF PROPERTY BY CITY
Subject to all the terms, covenants and conditions of this Agreement, City shall use its best efforts,
including the exercise of its eminent domain powers, if necessary, to acquire Property for the purpose of
conveying the same to Developer.
SECTION 2. LEASE OF PROPERTY TO DEVELOPER
2.1 Lease. On the Closing Date, City shall transfer possession of Property pursuant to a lease with
the Developer (the "Lease") for a term of fifty (50) years. The Lease shall be substantially in the form of
Exhibit C attached hereto. On completion of the Phase II Improvements (as defined in Section 3.1
below), the Lease shall be extended for the appropriate period of time in order that the Lease shall be for
a term of fifty (50) years commencing on the date the Developer receives the certificate of completion
from the City related to the completion of the Phase II Improvements.
2.2 Recordation of Lease. On the Closing Date, Developer shall record a Memorandum of Lease as
stipulated in the Lease among the land records in the office of the Recorder of Dubuque County, Iowa.
Developer shall pay all the costs for so recording.
2.3 Condition of Property. City shall deliver the Property to the Developer in a condition that the
Developer can immediately commence constructing the Minimum Improvements (as defined in Section
3.1 below), including without limitation, the demolition by the City of all pre-existing structures on the
Property, and shall deliver the Property to Developer in a condition that satisfies the following standards;
(a) Environmental Investigation. City shall retain an environmental consultant to conduct a Phase
I environmental assessment that shall comply with the ASTM E 1527-97 standard with the exception of
those reasonable and documented exceptions agreed upon by Developer. The City shall also retain an
environmental consultant to complete a Phase II environmental assessment that shall comply with the
ASTM E 1903-97 standard with the exception of those reasonable and documented exceptions agreed
upon by Developer. The Phase II shall consider those concerns identified in the Phase I. The City and
Developer shall consult concerning the identity of the environmental consultant, and Developer shall not
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unreasonably withhold approval of the environmental consultant. Developer approves Preston
Engineering as an acceptable environmental consultant for the purposes of this Agreement. The City and
Developer shall consult concerning the scope of work to be included in the Phase II, and Developer shall
not unreasonably withhold approval of the Phase II scope of work. Upon completion of the Phase I and
Phase II environmental assessment reports, City may in its sole discretion undertake additional
environmental assessment ("Supplemental Phase II") after consultation with Developer. Developer shall
have the right to inspect the Property prior to the Closing Date and to take whatever tests or perform such
examination, as Developer shall deem appropriate, at its own risk and its sole cost and expense. Prior
notice of such activity by Developer shall be provided to the City and written results of such activity shall
be shared with the City. Any test, examination or inspection of the Property by Developer shall not
eliminate or relieve the City of its obligations under this Section2.3.
(b) Comfort Letter. If the environmental assessments indicate that Hazardous Substances on the
Property are in excess of any applicable action level, as defined at 567 Iowa Administrative Code § 133.2,
567 Iowa Administrative Code Chapter 135, or applicable statewide standard developed under Iowa Code
Chapter 455H, if the Property is statutorily eligible, whichever is less stringent, then City shall obtain a
"no -action letter" from the Iowa Department of Natural Resources and if the Environmental Protection
Agency ("EPA") has concurrent or primary jurisdiction over the particular Hazardous Substance identified,
then City shall also obtain the appropriate comfort letter/status letter pursuant to the EPA's Policy on the
Issuance of Comfort/Status Letters, Nov. 8, 1996. The no -action letter and/or comfort/status letter
("collectively termed "Comfort Letters") shall be subject only to such restrictions, impairments, and
conditions that do not substantially impair the use of the Property and which are approved by Developer,
which approval shall not be unreasonably withheld. Any requirement, restriction or condition that the
Property be moved more than one hundred (100) feet from the location identified in this Agreement and
the Lease shall be defined as a substantial impairment. Any Comfort Letter shall be based on the
anticipated use of the Property as outlined in this Agreement, including all anticipated expansions.
(c) Remediation. If the City or a governmental agency having jurisdiction over Environmental
Laws determines that the concentrations of Hazardous Substances on the Property require removal
and/or remediation prior to the issuance of a required Comfort Letter as defined above, then City shall
retain an environmental consultant to prepare a plan ("Environmental Remediation Plan") for the removal
and/or remediation of the identified Hazardous Substances as required by applicable environmental
agency or agencies. The Environmental Remediation Plan shall provide for the removal and/or
remediation of the identified Hazardous Substances to a level sufficient to obtain the aforementioned
"Comfort Letter". The Environmental Remediation Plan shall include an estimate of the total costs of
conducting the removal and/or remediation required by the applicable government agency or agencies to
obtain the required Comfort Letters. The estimate of costs shall be based on the cost of local contractors,
provided local contractors are qualified and available to perform such work. The estimate of costs shall
not include internal staff costs to the City. Following the completion of the Environmental Remediation
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Plan, the City shall cause the removal and/or remediation of Hazardous Substances as required by the
applicable governmental agency or agencies to be accomplished prior to obtaining the required Comfort
Letters and prior to Closing unless otherwise agreed to by the Developer. All of the costs of obtaining the
Phase I, Phase II, Supplemental Phase II, Environmental Remediation Plan and any remediation and/or
monitoring as required by Comfort Letter shall be borne by the City. City shall not be responsible for costs
generated by Developer if Developer retains a consultant to assist it in reviewing the aforementioned
reports. The requirement to obtain a the required Comfort Letters shall be a material precondition to
closing.
(d) $200,000 Cap on Additional Costs for Developer. Neither the Comfort Letters required by
2.3(b) of this Agreement, nor any Environmental Remediation Plan provided by 2.3(c) of this Agreement
shall result in a substantial impairment of the planned and intended use of the Property by Developer. A
substantial impairment shall include, but not be limited to, additional costs for the construction of the
Minimum Improvements which in total exceed the sum of $200,000. The determination of the additional
costs shall be based upon those changes or other modifications which would not need to be made were it
not for the environmental condition of the Property as disclosed in the environmental assessments
(Phase I, Phase II and Supplemental Phase II) and, if applicable, the Environmental Remediation Plan.
In the event that the Remediation Plan results in a substantial impairment, which includes additional costs
that exceed $200,000, then Developer at its option may declare that the City has defaulted in its duty to
obtain the required Comfort Letters acceptable to Developer. In the event that the City pays all additional
costs that exceed $200,000, the Developer shall be prohibited from declaring the City in default under this
subsection 2.3(d). Notwithstanding the foregoing, the City shall have no obligation or responsibility to pay
any additional costs as a result of any substantial impairment of the Property.
(e) $1,000,000 Cap on Remediation Costs for City. If after submitting a Remediation Plan to the
applicable governmental agencies as may be required under 2.3(c) of this Agreement, it is reasonably
determined by the City Council of the City, based upon a recommendation by the environmental
consultant, that the costs of the removal and/or remediation necessary to obtain the required Comfort
Letters will exceed the sum of one million dollars ($1,000,000), then City shall have the option to
terminate this Agreement within fifteen days after receiving the Environmental Remediation Plan or
November 15, 2000, whichever date occurs first.
(f) Release of Reports and Data. The City shall promptly provide Developer with a copy of all
environmental consulting or engineering reports, separate laboratory analysis reports, and other material
information and data received by City, in the possession of the City, or generated by the environmental
consultant, regarding the environmental condition of the Property, or which are otherwise received or
generated as part of the Phase I, Phase II and Supplemental Phase II environmental assessments or
removal and/or remediation action, except for attorney-client privileged documents.
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(g) Reciprocal Covenants. Developer covenants and agrees that City shall have no responsibility
for or liability arising from any release of a Hazardous Substance, which is caused by Developer.
Notwithstanding any other provision of this Agreement, Developer shall not have any responsibility for
any Hazardous Substance which leaches or migrates upon the Property from any adjacent property or
any release of a Hazardous Substances which is caused by City or which pre-exists the date of this
Agreement.
(h) Utilities. The City shall provide all necessary utilities to the Property in order to develop,
construct and operate the Minimum Improvements.
apply:
(i) Definitions. For the purposes of this Development Agreement, the following definitions shall
(i) "Environmental Law" means any and all federal, state and/or local laws, regulations
and legal requirements pertaining to (i) the protection of health, safety and the indoor and outdoor
environment, (ii) the conservation, management or use of natural resources and wildlife, (iii) the
protection, access to or use of surface water and groundwater, (iv) the management,
manufacture, possession, presence, use, generation, transportation, treatment) storage, disposal,
Release, threatened Release, abatement, removal, remediation or handling of, or exposure to,
any Hazardous Substance or (v) pollution (including, without limitation, any Release to air, land,
surface water and groundwater), and includes, without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended by the
Superfund Amendment and Reauthorization Act of 1986, 42 USC 9601 et seq; the Solid Waste
Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976 and the
Hazardous and Solid Waste Amendments of 1984, 42 USC 6901 et seq.; the Federal Water
Pollution Control Act, as amended by the Clean Water Act of 1977, 33 USC 1251 et seq.; the
Clean Air Act of 1966, as amended, 41 USC 7401 et seq.; the Toxic Substances Control Act of
1976, 15 USC 2601 et seq.; the Hazardous Substances Transportation Act, 49 USC App. 1801 et
seq.; the Occupational Safety and Health Act of 1970, as amended, 29 USC 651 et seq.; the Oil
Pollution Act of 1990, 33 USC 2701 et seq.; the Emergency Planning and Community
Right -to -Know Act of 1986, 42 USC 11001 et seq.; the National Environmental Policy Act of 1969,
42 USC 4321 et seq.; the Safe Drinking Water Act of 1974, as amended, 42 USC 300(f) et seq.;
Chapter 455B of the Iowa Code; any similar, implementing or successor law to any of the
foregoing and any amendment, rule, regulation, order or directive issued thereunder.
(ii) "Hazardous Substance" or "Hazardous Substances" means any hazardous or toxic
substance, material or waste, which is or becomes regulated by any local government, the State
of Iowa or the United States Government. It includes, without limitation, any material or
substance that is (i) defined as a "hazardous substance" or "hazardous waste" under Chapter
455B, Iowa Code, (ii) petroleum and petroleum products, (iii) asbestos containing materials in any
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form or condition, (iv) designated as a "hazardous substance" pursuant to Section 311 of the
Federal Water Pollution Control Act (33 U.S.C. § 1321), (v) defined as a "hazardous waste
pursuant to § 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. §6901 et
seq., (vi) defined as a "hazardous substance" pursuant to § 101 of the Comprehensive
Environmental Response, Compensation and Liability Act, U.S.0 § 9601 et seq., or (vii) defined
as a "regulated substance" pursuant to Subchapter IX, Solid Waste Disposal Act (Regulation of
Underground Storage Tanks), 42 U.S.C. § 6991 et seq.] The term "Hazardous Substance" shall
not include any air emissions discharged into the atmosphere as allowed by a duly issued permit
from the applicable governmental agency.
(iii) "Release" means any spilling, migrating, seeping, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or disposing of any Hazardous
Substance into the indoor or outdoor environment, including, without limitation, the abandonment
or discarding of barrels, drums, containers, tanks and other receptacles containing or previously
containing any Hazardous Substance and including without limitation the migration of any
Hazardous Substance onto the Property from an adjacent property.
2.4 Representations of City. In order to induce Developer to enter into this Agreement, City hereby
represents and warrants to Developer:
(1) At the Closing Date, City has lawful possession of the Property.
(2) At the Closing Date, unless waived by Developer, City has been awarded Vision Iowa funding
in an amount sufficient to construct a minimum 100,000 square foot conference and education
center facility and parking facility.
(3) City has duly obtained all necessary authorizations, approvals and consents for its execution,
delivery and performance of this Agreement, and that it has full power and authority to execute,
deliver and perform its obligations under this Agreement.
(4) This Agreement is a valid and legally binding instrument of the City enforceable in
accordance with its material terms, except as the same may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting creditors' rights generally.
(5) The execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby, and the fulfillment of or compliance with the terms and conditions of this
Agreement are not prevented by, limited by, in conflict with, or result in a violation or breach of,
the any contractual restriction, evidence of indebtedness, agreement or instrument of whatever
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nature to which the City is now a party or by which it or its property is bound, or constitute a
default under any of the foregoing.
(6) Other than as disclosed on Schedule 2.4(6) attached hereto, there are no actions, suits or
proceedings pending or threatened against or affecting the City in any court or before any
arbitrator or before or by any governmental body in which there is a reasonable possibility of a
adverse decision which could materially adversely affect the validity of the Agreement or the
City's ability to perform its obligations under this Agreement.
(7) The City will cooperate with the Developer to resolve any traffic, parking, trash removal or
public safety problems which may arise in connection with the construction and operation of the
Minimum Improvements.
2.5. Representations and Warranties of Developer. The Developer makes the following representations
and warranties;
(1) The Developer is a limited liability company duly organized and validly existing under the
laws of the State of Iowa, and has all requisite power and authority to own and operate its
properties, to carry on its business as now conducted and as presently proposed to be
conducted, and to enter into and perform its obligations under the Agreement.
(2) This Agreement has been duly authorized, executed and delivered by the Developer and,
assuming due authorization, execution and delivery by the City, is in full force and effect and
is a valid and legally binding instrument of the Developer enforceable in accordance with its
terms, except as the same may be limited by bankruptcy, insolvency, reorganization or other
laws relating to or affecting creditors' rights generally.
(3)
The execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby, and the fulfillment of or compliance with the terms and conditions of
this Agreement are not prevented by, limited by, in conflict with, or result in a violation or
breach of, the terms, conditions or provisions of the articles of organization or the operating
agreement of the Developer or any contractual restriction, evidence of indebtedness,
agreement or instrument of whatever nature to which the Developer is now a party or by
which it or its property is bound, or constitute a default under any of the foregoing.
(4) There are no actions, suits or proceedings pending or threatened against or affecting the
Developer in any court or before any arbitrator or before or by any governmental body in
which there is a reasonable possibility of a adverse decision which could materially adversely
affect the business, financial position or result of operations of the Developer or which affects
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the validity of the Agreement or the Developer's ability to perform its obligations under this
Agreement.
(5) The Developer will cause the Minimum Improvements to be constructed in accordance with
the material terms of this Agreement, the Urban Renewal Plan and all local, State and federal
laws and regulations, except for variances necessary to construct the Minimum
Improvements contemplated in the Construction Plans.
(6) The Developer will use its best efforts to obtain, or cause to be obtained, in a timely manner,
all material requirements of all applicable local, state, and federal laws and regulations which
must be obtained or met before the Minimum Improvements may be lawfully constructed.
(7) At the Closing Date, the Developer shall have firm commitments for commercially reasonable
construction and permanent financing for the Project in an amount sufficient, together with
equity commitments, to successfully complete the Minimum Improvements in accordance
with the construction Plans contemplated in this Agreement.
(8) The Developer will cooperate with the City to resolve any traffic, parking, trash removal or
public safety problems which may arise in connection with the construction and operation of
the Minimum Improvements.
2.6 Conditions to Closing. The closing of the transaction contemplated by this Agreement and all the
obligations of Developer and City under this Agreement are subject to fulfillment, on or before the Closing
Date, of the following conditions:
(1) The representations and warranties made by City in Section 2.3 and Section 2.4 and by
Developer in Section 2.5 shall be correct and satisfied as of the Closing Date with the same
force and effect as if such representations were made at such time.
(2) Developer, in its sole and absolute discretion, having completed and approved of any
inspections done by Developer hereunder.
(3) City shall have acquired lawful possession of all of the Property.
(4) City shall have approved all appropriate zoning, subdivision, or platting of the Property
necessary for the lease and immediate development and construction of the Property. Any
extraordinary conditions imposed, as a part of the zoning, platting or subdivision must be
satisfactory to Developer, in its sole opinion.
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(5) Developer shall be in material compliance with all the terms and provisions of this Agreement.
(6) Developer shall have furnished City with evidence, in a form satisfactory to City (such as a
letter of commitment from a bank or other lending institution), that Developer has firm financial
and/or equity commitments sufficient in amount to lease Property and complete construction of
Minimum Improvements (as defined herein) in conformance with Construction Plans (as defined
herein), or City shall have received such other evidence of Developer's financial ability as in the
reasonable judgment of City is required. Developer shall provide evidence of a commitment of
equity funds for the Phase I hotel complex described in Section 3.1A in an amount not less than
30% equity of total project costs.
(7) Receipt of an opinion of counsel to Developer in the form attached hereto as Exhibit D.
(8) All obligations under of the City under Section 2.3 and Section 2.4 have been satisfied.
(9) Developer and the City shall have entered into a Minimum Assessment Agreement, in the
form attached hereto as Exhibit E, Lease, and Management Agreement, in substantially the
form attached hereto as Exhibit F, for the conference and education center .
2.7 Closing. The closing shall take place on or before February 15, 2001 (the "Closing Date"), or
such other date as the parties may agree in writing. Exclusive possession of Property shall be delivered
on the Closing Date, in compliance with the terms of this Agreement, including City's representations and
warranties regarding the same. Consummation of the Closing shall be deemed an agreement of the
parties to Agreement that the conditions of closing shall have been satisfied or waived. If the conditions
set forth in Section 2.6 are not satisfied at Closing Date, this Agreement shall terminate unless a new
Closing Date is established by amendment to this Agreement. The termination of this Agreement shall be
the sole remedy in the event a condition set forth in Section 2.6 is not satisfied.
2.8 Closing Costs. The Developer shall pay the following costs and expenses in connection with the
closing:
(a) The documentary fee necessary to record the Memorandum of Lease.
(b) Developer's attorney's fees.
(c) Developer's broker and/or real estate commissions and fees, if any.
(d) A pro -rata portion of all taxes as provided in Section 2.9.
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The City shall pay the costs and expenses in connection with the closing as set forth in Section 4.1(5).
2.9 Real Estate Taxes. City shall pay all real estate taxes for all fiscal years which end prior to
Closing Date. Real estate taxes for the fiscal year in which Closing Date occurs shall be prorated
between City and Developer to Closing Date on the basis of a 365 day calendar year. Developer shall
pay all real estate taxes due in subsequent fiscal years pursuant to the Lease. Any proration of real
estate taxes on Property shall be based upon such taxes for the year currently payable.
SECTION 3. REDEVELOPMENT ACTIVITIES
3.1 Required Minimum Improvements. Developer hereby agrees to construct on Property the
following, hereinafter "Minimum Improvements":
A. A hotel complex costing not less than $20,000,000.00 consisting of at least:
(1) 200 guest rooms, of which:
(a) one (1) percent shall be three-room suites consisting of two bedrooms, a sitting area
and upgraded amenities,
(b) five (5) percent shall be two -room suites consisting of one bedroom, a sitting area
and upgraded amenities, and
(c) ten (10) percent shall be specialty suites with unique or upgraded amenities;
(2) associated proprietary parking as determined by Developer;
(3) a 24,000 square foot indoor water park;
(4) a restaurant;
(5) a lounge; and
(6) a gift shop.
B. A 45,000-50,000 square foot office and commercial building at a probable cost of $5.5 million
and associated proprietary parking which shall be constructed not later than twelve (12) months after the
completion of the conference and education center and which shall be the location of the home or
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regional office of The Durrant Group. The construction of the office and commercial building by The
Durrant Group is subject to the following conditions:
(a) The Developer shall have constructed the hotel complex referred to in Section 3.1A..
(b) The City shall have constructed the conference and education center of 100,000
square feet or more.
(c) The City shall have constructed sufficient parking for the proposed development.
(d) The Durant Group shall have obtained commercially reasonable financing for the
development and construction of the home/regional office.
(e) The City Council determines that the office and commercial building is consistent with
the Master Plan.
Developer shall lease from the City two (2) acres upon substantially the same terms as the Lease for
sublease to the Durrant Group for the home or regional office and proprietary parking as determined by
the Durrant Group unless the Durrant Group agrees to lease two (2) acres directly from the City upon
substantially the same terms as the Lease.
Furthermore, plans shall be submitted by Developer indicating the location of future expansions of the
Minimum Improvements on the Property to provide 150 additional guest rooms, an 18,000 square foot
addition to the water park and additional proprietary parking (the "Phase II Improvements"). Sufficient
land to accommodate the Phase II Improvements shall be part of the initial lease area. The development
of the Phase II Improvements shall not be required unless the following conditions are satisfied:
(a) Developer obtaining commercially reasonable financing for the development and construction
of the Phase II Improvements.
(b) The occupancy average with respect to the hotel portion of the Minimum Improvements
during any consecutive twenty-four (24) month period of operations of the hotel shall be at
least 85%. Commencing the twenty-fifth (25`h) month following the date Developer receives
the certificate of completion from the City for the Minimum Improvements as provided in
Section 3.4 below (the "Certificate of Completion Date"), and every month thereafter,
Developer shall make the occupancy figures for the immediately preceding twenty-four (24)
month period available to the City to review. The foregoing obligation to make available the
occupancy figures shall terminate effective the forty-third month (43rd) following the
Certificate of Completion Date.
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(c) The City shall have constructed the conference and education center and parking facilities
within reasonable proximity to the Minimum Improvements.
If the above conditions are satisfied, Developer shall be obligated to develop and construct the Phase II
Improvements. If the above conditions are satisfied, the Developer shall have five (5) years from the
Certificate of Completion Date to complete construction of the Phase II Improvements. The obligation of
Developer to construct the Phase II Improvements shall terminate if the above conditions have not been
satisfied within forty-two (42) months of the Certificate of Completion Date. In the event that Developer
does not construct Phase II Improvements as required above, the leased premises shall be reduced by
an area equal to the area that is allocated for proprietary parking for the Phase II Improvements.
The Minimum Improvements shall be of quality architectural design and shall be compatible with
neighboring buildings and adjoining conference and education center facilities. The design of Minimum
Improvements shall be compatible with the pedestrian orientation of adjoining streets. The Minimum
Improvements shall provide for reasonable public accessibility to the Riverwalk and Harborwalk
improvements and the conference and education center facility, including a public access easement
through a designated common area of the Property. Consultants recommended by a work group to the
City Manager and agreed upon by the City Council and Developer and retained by the City shall develop
architectural standards and prepare site planning for the entire urban renewal area encompassing the
Property. The work group shall make a recommendation to the City Manager on the selection of an
architect to design the conference and education center . Final determination of architectural standards
and site planning and the selection of the conference and education center architect shall be made by the
City Council. Determination of whether the standards are met in the area shall be made by the work
group.
On the Closing Date, Developer and the City shall enter into a minimum assessment agreement as
provided in Iowa Code Section 403.6 (the "Minimum Assessment Agreement") in the form attached
hereto as Exhibit E. The Minimum Assessment Agreement shall establish a minimum assessment of the
Property equal in amount to the amount determined necessary by the City in its sole judgment to permit
the collection of incremental tax revenues sufficient in amount to cause the indebtedness and all other
costs incurred by the City with respect to the Property to be repaid within four (4) years following the
commencement of full operation of the Minimum Improvements. The City shall use Iowa Code Section
403.6(18) with respect to the collection and payment of taxes under the Minimum Assessment
Agreement.
3.2 Plans for Construction of Minimum Improvements. Plans and specifications with respect to the
redevelopment of Property and the construction of Minimum Improvements thereon (the "Construction
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Plans") shall be in substantial conformity with the Urban Renewal Plan, this Agreement, and all applicable
State and local laws and regulations. Developer shall submit to City, for approval by City plans, drawings,
specifications, and related documents with respect to the Minimum Improvements to be constructed by
Developer on the Property. All work with respect to the Minimum Improvements shall be in substantial
conformity with the Construction Plans approved by City and shall be coordinated with City improvements
in the general vicinity of Property, including, but not limited to, the Riverwalk, the conference and
education center and street and utility improvements.
3.3 Timing of Improvements. Developer hereby agrees that construction of the Minimum
Improvements on Property shall be commenced within six (6) months after the Closing Date, and shall be
substantially completed within eighteen (18) months after the Closing Date. 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 Developer 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), governmental restriction upon the availability or use of
labor or materials, 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.
3.4 Certificate of Completion. Promptly upon substantial completion of the Minimum Improvements
in accordance with those provisions of this Agreement relating solely to the obligations of Developer to
construct the Minimum Improvements (including the dates for beginning and completion thereof), City
shall furnish Developer with an appropriate instrument so certifying. Such certification shall be a
conclusive determination of the satisfaction and termination of the agreements and covenants in this
Agreement and in the Lease with respect to the obligations of Developer to construct the Minimum
Improvements.
SECTION 4. CITY PARTICIPATION
4.1 Improvements by City. For and in consideration of Developer's obligations hereunder to
construct Minimum Improvements, City agrees to:
(1) Apply for Vision Iowa Funds to construct a minimum 100,000 square foot conference and
education center facility and parking facility in the Project Area.
(2) At the time of Closing, enter into a ten (10) year management contract, in substantially the
form of Exhibit F attached hereto, with Developer, or a related affiliate controlled by James P.
Rix, to manage said conference and education center facility.
(3) By the Certificate of Completion Date, have constructed or provided access to sufficient
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additional public parking spaces within reasonable proximity to the Minimum Improvements.
Parking may be subject to users fees as determined by City. Proprietary parking for Developer's
operations shall be the sole responsibility of Developer.
(4) Construct Riverwalk improvements as provided in the City's FY 2001-2005 Capital
Improvement Program as approved by the City Council in March 2000.
(5) Pay the following costs and expenses in connection with the closing:
(a) The transfer fee imposed on the conveyance, if any.
(b) A pro -rata portion of all taxes as provided in Section 2.9.
(c) All special assessments whether levied, pending or assessed.
(d) City's attorney's fees.
(e) City's broker and/or real estate commissions and fees, if any.
(f) Such other costs as are imposed upon the City as more particularly set forth in this
Agreement.
(6) Pay all costs associated with construction of any streets, sidewalks, landscaping and lighting
on property not leased by Developer, such streets, landscaping and lighting shall be consistent
with the character and requirements recommended to the City Manager by the work group
agreed upon by the City and the Developer.
4.2 Exclusivity. City agrees that it shall not enter into any other agreement that includes the
construction of a hotel on publicly owned land in the Ice Harbor Urban Renewal District with any other
party for a period of fifteen (15) years after completion of Developer's project (the "Exclusivity Period").
On completion of the Phase II Improvements, the Exclusivity Period shall be extended for the appropriate
period of time in order that the Exclusivity Period shall be for a period of fifteen (15) years commencing on
the date the Developer receives the certificate of completion from the City related to the completion of the
Phase II Improvements.
SECTION 5. COVENANTS OF DEVELOPER
5.1 Insurance Coverages. Developer shall maintain insurance as set forth in the Lease.
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5.2 Non -Discrimination. In carrying out the project, Developer shall not discriminate against any
employee or applicant for employment because of race, religion, color, sex, national origin, age or
disability.
5.3 Conflict of Interest. Developer agrees that no member, officer or employee of City, or its
designees or agents, nor any consultant or member of the governing body of City, and no other public
official of City who exercises or has exercised any functions or responsibilities with respect to the project
during his or her tenure, or who is in a position to participate in a decision-making process or gain insider
information with regard to the project, shall have any interest, direct or indirect, in any contract or
subcontract, or the proceeds thereof, for work to be performed in connection with the project, or in any
activity, or benefit therefrom, which is part of this project at any time during or after such person's tenure.
5.4 Non -transferability. Prior to the issuance of the Certificate of Completion, this Agreement may
not be assigned by Developer nor may the Lease be transferred without the prior written consent of the
City. After the issuance of the Certificate of Completion, the Developer shall have the right to transfer and
assign this Agreement and the Lease to a third party, subject to the consent of the City, which consent
shall not be unreasonably withheld, provided said third party transferee agrees to comply with the terms
and conditions of this Agreement. Notwithstanding the foregoing, Developer shall have the right to assign
a designated portion of the Lease to The Durant Group with respect to the home or regional office.
5.5 Restrictions on Use. Developer agrees for itself, and its successors and assigns, and every
successor in interest to Property or any part thereof, and the Lease shall contain covenants on the part of
Developer for itself, and such successors and assigns, that Developer and such successors and assigns,
shall:
(1) Devote Property to, and only to and in accordance with, the uses specified in this Agreement
and the Urban Renewal Plan;
(2) Operate the Minimum Improvements only as a hotel, water park and related necessary
activities and purposes unless the City consents to an alternative use in City's sole discretion;
and
(3) Not discriminate upon the basis of race, religion, color, sex, national origin, age or disability in
the sale, lease, rental, use or occupancy of Property or any improvements erected or to be
erected thereon, or any part thereof.
5.6 Maintenance of Properties. The Developer will maintain, preserve and keep the Minimum
Improvements in good repair and working order, ordinary wear and tear accepted, and from time to time
will make all necessary repairs, replacements, renewals and additions.
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5.7 Maintenance of Records. The Developer will keep at all times proper books of record and
account in which full, true and correct entries will be made of all dealings and transactions of or in relation
to the business and affairs of the Developer in accordance with generally accepted accounting principles,
consistently applied throughout the period involved, and the Developer will provide reasonable protection
against loss or damage to such books of record and account.
5.8 Compliance with Laws. The Developer will comply with all laws, rules and regulations relating to
the Minimum Improvements, other than laws, rules and regulations the failure to comply with or which the
sanctions and penalties resulting therefrom, would not have a material adverse effect on the business,
property, operations, or condition, financial or otherwise, of the Developer.
5.9 Non -Discrimination. The Developer shall substantially comply with all federal, State of Iowa and
local laws prohibiting discrimination. The Developer shall not discriminate against any person or group of
persons on account of age, race, religion, creed, color, sex, national origin, ancestry, or disability.
5.10 Available Information. Upon request, the Developer shall make available to the City to review
copies of its financial statements for the preceding fiscal year, prepared in accordance with generally
accepted accounting principles and accompanied by a report of an independent public accountant
selected by the Developer to the effect that such financial statements have been prepared in conformity
with generally accepted accounting principles and present fairly, in all material respects, the financial
condition of the Developer and that the examination of such financial statements by such accountant has
been undertaken in accordance with generally accepted auditing standards. Any financial statements
that are requested and reviewed by the City shall be treated by the City as confidential trade secrets of
Developer under Iowa Code Chapter 22, to the extent permitted by law.
SECTION 6. INDEMNIFICATION
(1) Developer releases City and the governing body members, officers, agents, servants and
employees thereof (hereinafter, for purposes of this Section 6, the "Indemnified Parties") from,
covenants and agrees that the Indemnified Parties shall not be liable for, and agrees to
indemnify, defend and hold harmless the indemnified parties against any loss or damage to
property or any injury to or death of any person occurring at or about or resulting from any defect
in Minimum Improvements.
(2) Except for any willful misrepresentation or any willful or wanton misconduct or any unlawful
act of the Indemnified Parties, Developer agrees to protect and defend the Indemnified Parties,
now or forever, and further agrees to hold the Indemnified Parties harmless, from any claim,
demand, suit, action or other proceedings whatsoever by any person or entity whatsoever arising
or purportedly arising from (i) any violation by Developer of any agreement or condition of this
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Agreement (except with respect to any suit, action, demand or other proceeding brought by
Developer against City to enforce its rights under this Agreement) or (ii) the construction,
installation, ownership and operation of Minimum Improvements or (iii) environmental
contamination which affects the condition of the Property and which is caused by the Developer
and occurs after the Developer takes possession of the Property.
(3) Except for any misrepresentation or any willful or wanton misconduct or any unlawful act of
Developer, the City agrees to protect and defend Developer, now or forever, and further agrees to
hold Developer harmless, from any claim, demand, suit, action or other proceedings whatsoever
by any person or entity whatsoever arising or purportedly arising from (i) any violation by the City
of any agreement or condition of this Agreement (except with respect to any suit, action, demand
or other proceeding brought by the City against Developer to enforce its rights under this
Agreement).
(4) The Indemnified Parties shall not be liable for any damage or injury to the persons or property
of Developer or its officers, agents, servants or employees or any other person who may be about
Minimum Improvements due to any act of negligence of any person, other than any act of
negligence on the part of any such indemnified party or its officers, agents, servants or
employees.
(5) All covenants, stipulations, promises, agreements and obligations of City contained herein
shall be deemed to be the covenants, stipulations, promises, agreements and obligations of City,
and not of any governing body member, officer, agent, servant or employee of City in the
individual capacity thereof.
(6) The provisions of this Section 6 shall survive the termination of this Agreement.
SECTION 7. EVENTS OF DEFAULT AND REMEDIES
7.1 Events of Default Defined. The following shall be "Events of Default" under this Agreement and
the term "Event of Default" shall mean, whenever it is used in this Agreement, any one or more of the
following events:
(1) Any event of default by Developer or the City under the Lease.
(2) Failure by Developer to cause the construction of Minimum Improvements to be commenced
and completed pursuant to the terms, conditions and limitations of this Agreement.
(3) Failure by Developer to cause Minimum Improvements to be reconstructed when required
17
pursuant to the Lease.
(4) Transfer of any interest by Developer of Minimum Improvements in violation of the provisions
of this Agreement.
(5) Failure by Developer to substantially observe or perform any other covenant, condition,
obligation or agreement on its part to be observed or performed under this Agreement or the
Lease.
(6) Failure by the City to substantially observe or perform any other covenant, condition,
obligation or agreement on its part to be observed or performed under this Agreement or the
Lease.
(7) Commencement of foreclosure proceedings by the holder of any mortgage on Developer's
interest in the Property, or any improvements thereon, or any portion thereof, as a result of any
default under the applicable mortgage documents.
(8) Developer shall:
(a) file any petition in bankruptcy or for any reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy
Act of 1978, as amended, or under any similar federal or state law; or
(b) make an assignment for the benefit of its creditors; or
(c) admit in writing its inability to pay its debts generally as they become due; or
(d) be adjudicated a bankrupt or insolvent: or if a petition or answer proposing the
adjudication of Developer as a bankrupt or its reorganization under any present or future
federal bankruptcy act or any similar federal or state law shall be filed in any court and
such petition or answer shall not be discharged or denied within ninety (90) days after the
filing thereof, or a receiver, trustee or liquidator of Developer or of Minimum
Improvements, or part thereof, shall be appointed in any proceedings brought against
Developer, and shall not be discharged within ninety (90) days after such appointment, or
if Developer shall consent to or acquiesce in such appointment.
7.2 Notice of Default. The non -defaulting party shall issue a written notice of default providing
therein a thirty (30) day period in which the defaulting party shall have an opportunity to cure such default,
provided that cure is possible and feasible.
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7.3 Remedies Upon Default. If the default remains unremedied after such thirty (30) day period, the
non -defaulting party shall have the right to do one or more of the following:
(1) exercise any remedy provided by law or available to a party under the Lease;
(2) suspend the non -defaulting party's performance under this Agreement;
(3) terminate this Agreement and the Lease;
(4) withhold certification of completion with respect to the Minimum Improvements;
(5) require payment by the defaulting party of any costs incurred by the non -defaulting party in
connection with the default; and
(6) take such action as may be necessary to remove Developer from Property.
7.4 No Implied Waiver. In the event any agreement contained in this Agreement should be breached
by any party and thereafter waived by any other party, such waiver shall be limited to the particular
breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach
hereunder.
SECTION 8. GENERAL TERMS AND PROVISIONS
8.1 Notices and Demands. Whenever this Agreement requires or permits any notice or written
request by one party to another, it shall be in writing, enclosed in an envelope, addressed to the party to
be notified, properly stamped, sealed and deposited in the United States Mail, and
(1) in the case of Developer, is addressed to Platinum Holdings, LLC, 801 Jackson Street,
Dubuque, Iowa 52001.
(2) in the case of City, is addressed to the City Manager, City Hall, 50 W. 13th Street, Dubuque,
Iowa 52001.
or at such other address with respect to either party as that party may, from time to time designate in
writing and forward to the other as provided in this Section. Any notice delivered hereunder shall be
deemed delivered upon the earlier of the actual receipt or two (2) business days after posting.
8.2 Compliance with Laws and Regulations. Developer and the City shall comply with all applicable
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City, State and federal laws, rules, ordinances, regulations and orders.
8.3 Binding Effect.
This Agreement shall be binding upon and shall inure to the benefit of City and Developer and their
respective successors and assigns.
IN WITNESS WHEREOF, City has caused this Agreement to be duly executed in its name and
behalf by its Mayor and attested by its City Clerk, and Developer has caused this Agreement to be duly
executed in its name and behalf by James P. Rix, its Chief Executive Officer on or as of the day first
above written.
By:
By:
CITY OF DUBUQUE, IOWA
Te rance M. Duggan, M
By:
DEVELOPER
P. Rix, Chief E
By:
utive Officer
eanne F. Schneider, City Clerk Donald Iverson, Member
August 17, 2000
F:\USERS\Pmyhre\WPDOCS\UR\Ice Harbor\DevAgree.pla.wpd
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LEASE AGREEMENT
THIS LEASE AGREEMENT (the "Lease") made as of the 4th day of June, 2001, by and
between the CITY OF DUBUQUE, IOWA, a municipal corporation (Lessor), and PLATINUM
HOLDINGS, LLC, an Iowa limited liability company (Lessee).
WHEREAS, Lessor and Lessee have entered into a certain Amended Development
Agreement dated as of January 15, 2001 (the "Development Agreement"); and
WHEREAS, the Development Agreement contemplates that the parties enter into a lease
for certain real estate in Dubuque County, Iowa;
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth
herein, the parties hereto agree as follows:
ARTICLE 1
DEMISE AND TERM
1.1 Demise and Term. 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 described in Exhibit A attached to and made a part of this Lease,
together with any and all easements and appurtenances thereto and subject to any easements and
restrictions of record (the "Demised Premises"), to have and to hold for an initial term
commencing as of the date of this Lease and ending on the 3`d day of June, 2051 (the "Initial
Term"), subject to all of the terms, covenants, conditions and agreements contained herein. On
completion of the Phase II Improvements (as defined in Section 3.1 of the Development
Agreement), the term shall be extended for the appropriate period of time in order that the Lease
term shall be fifty (50) years from the time the Lessee receives the Certificate of Completion
related to the completion of the Phase II Improvements.
1.2 Minimum Improvements. Lessee shall construct the Minimum Improvements (as
defined in Section 3.1 of the Development Agreement) in the time and manner required by the
Development Agreement.
1.3 Parking Use Agreement. In connection with this Lease, the Lessor and Lessee
shall enter into a Parking Use Agreement, in substantially the form of Exhibit G (the "Parking
Use Agreement"), pursuant to which the Lessor shall provide parking to Lessee at no cost. The
Parking Use Agreement shall be transferable with this Lease and shall remain in effect for the
length of the Initial Term and any extension or renewal of this Lease.
ARTICLE 2
RENT
Lessee shall pay Lessor (in addition to taxes, assessments, and other charges required to
be paid under this Lease by Lessee) rent for the Demised Premises as follows:
2.1 Base Rent. Until Lessee has received a Certificate of Completion for the
Minimum Improvements (as set forth in Section 3.4 of the Development Agreement), Lessee
shall pay Base Rent in the amount of $1.00 per year. For the first ten years of this Lease
following receipt of such Certificate of Completion, Lessee shall pay Lessor rent as follows:
Year
Amount
One through Three
$22,860.00
Four through Five
$30,480.00
Six through Seven
$45,720.00
Eight through Nine
$53,340.00
Ten
$66,040.00
All such Base Rent shall be payable in twelve (12) equal monthly installments on the first
day of each month. Notwithstanding the foregoing, in the event that Developer completes the
Phase II Improvements in accordance with Section 3.1 of the Development Agreement, the Base
Rent in effect at such time of completion shall become the Base Rent for an extended period of
three (3) years following such completion, and thereafter, the above schedule shall resume
unabated and in full and shall be extended by such additional three (3) year period.
Rental payable after the time such schedule has completed shall be computed as follows:
(i)
The annual rental in effect at the completion of the above rental schedule
shall be adjusted by the percentage increase, if any, in the Consumer Price Index
for All Urban Consumers, U.S. City Average, All Items published by the Bureau
of Labor Statistics of the U.S. Department of Labor in effect on the
commencement date of the rental period immediately following the completion of
the above rental schedule over the base Consumer Price Index in effect on the date
one (1) year prior thereto. The annual rental computed under this subparagraph (i)
shall be the annual Base Rent for the Demised Premises for the one (1) year
period immediately following the completion of the above rental schedule. The
annual Base Rent shall be paid in twelve (12) equal monthly installments.
(ii) The annual rental for the one (1) year period following the rental period in
subparagraph (i) above, and for each one (1) year period thereafter, shall be
adjusted by the percentage increase, if any, in the Consumer Price Index for All
Urban Consumers, U.S. City Average, All Items published by the Bureau of Labor
Statistics of the U.S. Department of Labor in effect on the commencement date of
the new one (1) year period over the base Consumer Price Index in effect on the
commencement date of the immediately preceding one (1) year period. The
annual rentals computed under this subparagraph (ii) shall be the annual Base
Rent for the Demised Premises for the one (1) year period immediately following
the completion of the prior one (1) year period. The annual Base Rent shall be
paid in twelve (12) equal monthly installments.
(iii) If during the Initial Term of this Lease, or any extension or renewal thereof,
the Bureau of Labor Statistics, U.S. Department of Labor, ceases to maintain said
Consumer Price Index, such other index or standard as will most nearly
accomplish the intent and purpose of the Consumer Price Index and the use
thereof by the parties hereto shall be used in determining the amount of any such
adjustment.
ARTICLE 3
TITLE TO IMPROVEMENTS AND TRADE FIXTURES
3.1 Trade Fixtures. For the purposes of this Lease, "Trade Fixtures" shall mean all of
Lessee's personal property located on the Demised Premises used in Lessee's business. Title to
Lessee's trade fixtures (the "Trade Fixtures") is and shall be the sole and exclusive property of
Lessee during the term of this Lease and shall remain the sole and exclusive property of Lessee
after the expiration or termination of this Lease, for whatever reason. Lessor acknowledges and
understands that it shall have no right, title or interest in or to Lessee's Trade Fixtures either
during the term of this Lease, or thereafter (except as hereinafter provided). Lessor
acknowledges and agrees that Lessee shall have the right to encumber, sell, or hypothecate
Lessee's Trade Fixtures, to remove them from the Demised Premises, or to otherwise deal with
all or any portion of such Lessee's Trade Fixtures, at Lessee's sole discretion. Upon ten (10)
days' prior written notice to Lessor, Lessor shall execute and deliver to Lessee a certificate in
recordable form prepared by Lessee stating that Lessor has no interest or right in or to Lessee's
Trade Fixtures, as well as any other or further document which Lessee may reasonably request
from Lessor.
3.2 Improvements. On delivery of possession of the Demised Premises to Lessee,
Lessee shall construct on the Demised Premises the Minimum Improvements as required by the
Development Agreement (the "Improvements"). It shall be unreasonable for Lessor to withhold
such consent if such design, appearance and quality are generally compatible with other such
buildings in the area. Subject to applicable law and the obligations imposed on Lessor as a
governmental entity, Lessor agrees to process as expeditiously as possible all permits, variances
and approvals reasonably required to develop and construct the Improvements on the Demised
Premises. All improvements presently on the Demised Premises and all Improvements hereafter
constructed on the Demised Premises are and shall be the property of Lessee during the
continuance of the term of this Lease and no longer. Subject to the payment obligations of Lessor
set forth below, upon any termination of this Lease, by reason of any cause whatsoever, if the
Improvements or any part thereof shall then be on the Demised Premises, all of Lessee's right,
title, and interest therein shall cease and terminate, and title to the Improvements shall vest in
Lessor, and the Improvements or the part thereof then within the Demised Premises shall be
surrendered by Lessee to Lessor. No further deed or other instrument shall be necessary to
confirm the vesting in Lessor of title to the Improvements. However, upon any termination of
this Lease, Lessee, upon request of Lessor, shall execute, acknowledge and deliver to Lessor a
quitclaim deed confirming that all of Lessee's right, title and interest in or to the Improvements
have expired, and that title to the Improvements has vested in Lessor.
ARTICLE 4
ENCUMBRANCE OF LESSEE'S LEASEHOLD IN I LREST
4.1 Lessee's Right to Encumber Leasehold Interest. Lessee may encumber by
mortgage, deed of trust or other proper instrument, its leasehold interest and estate in the
Demised Premises, together with all Improvements on the Demised Premises, as security for any
indebtedness of Lessee, provided that no such encumbrance shall extend beyond the term of this
Lease. Lessee shall provide prompt written notice to Lessor of any such encumbrance together
with a copy of such encumbrance. In the event of any judicial or nonjudicial foreclosure under
any mortgage, deed of trust or other similar instrument made by Lessee covering its leasehold
interest in the Demised Premises, Lessor shall, upon such foreclosure or sale, recognize the
purchaser thereunder as lessee under this Lease, provided such purchaser expressly agrees in
writing to be bound by the terms of this Lease.
4.2 Notice to Holder of Encumbrance; Right of Holder to Cure Lessee's Default. If
Lessee shall encumber its leasehold interest and estate in the Demised Premises and if Lessee, or
the holder of the indebtedness, its successors and/or assigns (the "Holder") secured by the
encumbrance shall give notice to Lessor of the existence of the encumbrance and the address of
the Holder, then Lessor shall mail or deliver to the Holder, at such address, a duplicate copy of
all notices in writing which Lessor may, from time to time, give or serve on Lessee under and
pursuant to the terms and provisions of this Lease. The copies shall be mailed or delivered to the
Holder at, or near as possible to, the same time the notices are given to or served on Lessee. The
Holder may, at its option, at any time before the rights of Lessee shall be terminated as provided
in this Lease, pay any of the rents due under this Lease or pay any taxes and assessments, or do
any other act or thing required of Lessee by the terms of this Lease, or do any act or thing that
may be necessary and proper to be done in the observance of the covenants and conditions of this
Lease or to prevent the termination of this Lease; provided, however, that the doing of any act or
thing requiring possession of the Demised Premises shall be subject to the further rights of
Holder as set forth in Section 16.2. All payments so made and all things so done and performed
by the Holder shall be effective to prevent a foreclosure of the rights of Lessee thereunder as the
same would have been if done and performed by Lessee.
ARTICLE 5
TAXES
Until Lessee has received a Certificate of Completion for the Minimum Improvements (as
set forth in Section 3.4 of the Development Agreement), the Lessor shall be responsible for all
real estate taxes levied, taxed or imposed upon the Real Estate. After the completion of the
Minimum Improvements, Lessee agrees to pay as additional rent an amount equal to real estate
taxes upon the real estate of the Demised Premises that become payable during the term hereof
and which would become delinquent if not so paid during the term hereof. Lessee shall further
provide to Lessor official receipts of the appropriate taxing authority or other evidence
satisfactory to Lessor evidencing payment thereof.
During the term of this Lease, Lessee further 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 and which become payable during the term hereof and which would become
delinquent if not so paid during the term hereof, any buildings or improvements thereon which
may be taxed, charged, assessed, levied or imposed upon the leasehold estate hereby created and
upon the reversionary estate in said real estate during the term hereof and which become payable
during the term hereof and which would become delinquent if not so paid during the term hereof,
and all such other taxes, rates, charges, levies and assessments shall be paid by Lessee as they
become due and before they become delinquent during the term hereof.
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.
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.
Lessee shall at all times have the right to contest in good faith, in any proper proceedings,
in the name of Lessor if necessary, the payment or satisfaction of any such taxes, assessments,
rates, charges or levies so agreed to be paid by Lessee, if the validity thereof, or the right to
assess or levy the same against or collect the same from said Demised Premises or
Improvements, shall be disputed, but only to the extent permitted under the Minimum
Assessment Agreement between Lessor and Lessee with respect to the Demised Premises. Upon
the conclusion of any such suit or proceedings, or not less than three (3) months prior to the date
when the right to redeem therefrom expires, whichever will be the earlier, Lessee shall promptly
pay and satisfy such disputed tax, assessment or other charge as finally determined, together with
all expenses, costs and attorneys' fees whatsoever incurred in connection therewith.
ARTICLE 6
REPAIRS
Lessee shall at all times during the term of this Lease, at Lessee's own costs and expense,
keep the Demised Premises and the Improvements thereon, and all sidewalks, curbs, and all
appurtenances to the Demised Premises, in good order, condition and repair, casualties and
ordinary wear and tear excepted. Lessee shall keep and maintain the Demised Premises and all
Improvements in a condition consistent with other similarly classed operations. Lessee shall
keep the Demised Premises in such condition as may be required by law and by the terms of the
insurance policies furnished pursuant to this Lease, whether or not such repair shall be interior or
exterior, and whether or not such repair shall be of a structural nature. Upon reasonable notice to
Lessee, Lessor may, at its discretion and at its cost, conduct an annual inspection of the Demised
Premises to determine Lessee's compliance with this Article 6.
ARTICLE 7
COMPLIANCE WITH LAW
7.1 During the term of this Lease, Lessee shall comply with all local, state and federal
laws applicable to Lessee's use of the Demised Premises, including but not limited to the
Americans with Disabilities Act.
7.2 Lessee shall not commit waste on the Demised Premises except as necessary for
its business purposes including the removal or construction of any buildings and Improvements
on the Demised Premises, and shall be liable for any damages to or destruction of any buildings
or Improvements on the Demised Premises resulting from waste and shall be required to repair or
rebuild such buildings or Improvements. Lessee may remove existing Improvements or construct
new Improvements on the Demised Premises subject to all of the terms and conditions of this
Lease provided Lessee has received the prior approval of Lessor, which approval Lessor shall not
unreasonably withhold.
ARTICLE 8
ALTERATIONS
Lessee shall have the right, with Lessor's prior written consent which consent shall not be
unreasonably withheld for any such alteration, addition, or modification that exceeds Fifty
Thousand and 00/100 Dollars ($50,000.00) in cost, at Lessee's expense, from time to time during
the term of this Lease to make any alteration, addition or modification to the Demised Premises
or the Improvements thereon.
ARTICLE 9
USE OF DEMISED PREMISES
Lessee shall operate the Improvements for the purposes outlined in the Development
Agreement and shall not knowingly use or allow the Demised Premises 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 shall not suffer any act to be done
or any condition to exist within the Demised Premises or in any Improvement thereon, or permit
any article to be brought therein, which is dangerous, unless safeguarded as required by law, or
which, in law, constitute a nuisance, public or private, or which may make void or voidable any
insurance in force with respect thereto.
During the exclusivity period referred to in Section 4.2 of the Development Agreement,
Lessee agrees that at least seventy-five percent (75%), or not less than one hundred forty two
(142) rooms, of the hotel shall be reserved for group room reservations provided such group
room reservations are made with the Developer at least one (1) year in advance. In the event the
Phase II Improvements are constructed, Lessee agrees that at least sixty-five percent (65%), or
not less than two hundred (200) rooms, of the hotel shall be reserved for group room reservations
provided such group room reservations are made with Lessee at least one (1) year in advance.
For purposes of this Agreement, a suite shall be deemed to be one (1) room. After the
exclusivity period referred to in Section 4.2 of the Development Agreement, this paragraph shall
only apply if Lessee, or an entity affiliated with Lessee, is managing the conference and
education center owned by Lessor in the Ice Harbor District.
ARTICLE 10
INSURANCE
10.1 Lessee shall provide and maintain or cause to be maintained at all times 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):
A. Builder's risk insurance, written on the Special Perils Form in an amount equal to
one hundred percent (100%) of the replacement value of Improvements as the same shall
exist from time to time during the construction process;
B. Commercial general liability insurance (including operations, contingent liability,
operations of subcontractors, completed operations and contractual liability insurance)
together with an Owner's Contractor's Policy with limits against bodily injury and
property damage of not less than $2,000,000.00 for each occurrence (to accomplish the
above -required limits, an umbrella excess liability policy may be used); and
C. Worker's compensation insurance, with statutory coverage.
10.2 Upon completion of construction of Improvements, Lessee shall maintain, or
cause to be maintained, at its cost and expense (and from time to time at the request of City shall
furnish proof of the payment of premiums on) insurance as follows:
A. Property insurance against loss and/or damage to Improvements under an
insurance policy written on the Special Perils Form in an amount not less than the full
insurable replacement value of Improvements, 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. The term "replacement value" shall mean the actual
replacement cost of Improvements (excluding foundation and excavation costs and costs
of underground flues, pipes, drains and other uninsurable items) and equipment, and 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.
B. Commercial general liability insurance, including personal injury liability for
injuries to persons and/or property, in the minimum amount for each occurrence and for
each year of $2,000,000.00.
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
$500,000.00 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 Developer 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.
ARTICLE 11
LESSOR'S WARRANTII-4.S AND REPRESENTATIONS
11.1 Lessor's Representation of Good Title. Lessor covenants and warrants that Lessor
is lawfully seized in possession of the Demised Premises, shall take all necessary steps to acquire
fee simple title to the Premises as required by law, 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
Demised Premises. Lessor warrants to Lessee that the Demised Premises are properly zoned for
the conduct of the operation of Lessee's business.
ARTICLE 12
LESSEE'S WARRANTIHS AND REPRESENTATION
12.1 Lessee Compliance With Law.
A. Lessee shall comply with all applicable local, state and federal laws, rules,
regulations and permits with regard to the Demised Premises and its use, occupancy and control
of the Demised Premises.
B. Without limiting the obligations of Lessor under Section 3.2, Lessee shall
be responsible for obtaining any and all applicable permits, licenses or authorizations as may be
necessary for Lessee's use, occupancy and control of the Demised Premises.
12.2 Environmental Matters.
A. Lessee covenants and agrees that Lessor shall have no responsibility for or liability
arising from any release of a Hazardous Substance which is caused by Lessee or its agents or
invitees. Notwithstanding any other provision of this Lease, Lessor agrees that Lessee shall not
have any responsibility for any Pre -Existing Condition (as defined below) nor shall Lessor seek
indemnification from Lessee for any such Pre -Existing Condition. There is a rebuttable
presumption that any Hazardous Substances found on the Demised Premises were not deposited
by Lessee and are a Pre -Existing Condition. A pre-existing condition ("Pre -Existing Condition")
shall be defined as (i) any Hazardous Substances found on the Demised Premises which were not
deposited by Lessee or its agents or invitees on the Demised Premises, (ii) any Hazardous
Substances on the Demised Premises prior to the Initial Term of this Lease, and (iii) any
Hazardous Substances which leach or migrate on to the Demised Premises from any adjoining
properties, including properties owned by the Lessor.
B. Notwithstanding any other provision of this Lease, the Lessor, in its capacity as both
owner of the Demised Premises as landlord under this Lease, shall retain any legal responsibility
or liability, subject to available defenses, the Lessor may have under law for any Pre -Existing
B. Lessee covenants and agrees to promptly notify Lessor of any release of
Hazardous Substance in, on or about the Demised Premises of which Lessee has actual
knowledge.
C. Lessee covenants and agrees to promptly take any and all necessary and
appropriate response to address any release of Hazardous Substance for which Lessee is
responsible under Section 12.2A. Such response shall include, without limitation, notification to
appropriate governmental authorities, as may be required by law.
D. Lessee covenants and agrees to not manufacture, treat or dispose of
Hazardous Substances at the Demised Premises or knowingly allow the manufacture, treatment,
or disposal of Hazardous Substances same on the Demised Premises.
For the purposes of this Lease, "Hazardous Substance" or "Hazardous
Substances" means any hazardous or toxic substance, material or waste which is or becomes
regulated by any local government, the State of Iowa or the United States Government. It
includes, without limitation, any material or substance that is (i) defined as a "hazardous
substance" or "hazardous waste" under Chapter 455B, Iowa Code, (ii) petroleum and petroleum
products, (iii) asbestos containing materials in any form or condition, (iv) designated as a
"hazardous substance" pursuant to Section 311 of the Federal Water Pollution Control Act (33
U.S.C. § 1321), (v) defined as a "hazardous waste pursuant to § 1004 of the Federal Resource
Conservation and Recovery Act, 42 U.S.C. §6901 et seq., (vi) defined as a "hazardous
substance" pursuant to § 101 of the Comprehensive Environmental Response, Compensation and
Liability Act, U.S.0 § 9601 et seq., or (vii) defined as a "regulated substance" pursuant to
Subchapter IX, Solid Waste Disposal Act (Regulation of Underground Storage Tanks), 42 U.S.C.
§ 6991 et seq.] The term "Hazardous Substance" shall not include any air emissions discharged
into the atmosphere as allowed by a duly issued permit from the applicable governmental agency.
ARTICLE 13
INDEMNIFICATION
13.1 Indemnification of Lessee.
A. To the extent allowed by law, Lessor will indemnify and save harmless
Lessee 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 Lessee by reason of (a) any accident, injury to or
death of persons or loss of or damage to property occurring on or about the Demised Premises
and resulting from any act or omission of Lessor, (b) any failure on the part of Lessor to perform
or comply with any of the terms of this Lease and (c) any breach on the part of Lessor of any
warranty or representation contained in Article 11. In case any action, suit or proceeding is
brought against Lessee by reason of such occurrence, Lessor will, at Lessor expense and
discretion, either defend such action, suit or proceeding, or cause the same to be defended by
counsel approved by Lessee, which approval will not be unreasonably withheld.
B. Lessee shall have the right to perform environmental site assessments of
the Demised Premises to assess the environmental condition of the Demised Premises for the
purpose of constructing a hotel. Any results or reports created by such site assessment shall be
the property of Lessee and may be used by Lessee and Lessor for any purpose provided that
Lessor shall not disclose any such report or the information contained therein to any third party
unless required to do so by law or legal process.
13.2 Indemnification of Lessor. Lessee will 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 Demised Premises during the
term of this Lease and resulting from any negligence 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 in any material respect with any of the material terms of this Lease, and (c) any material
breach on the part of Lessee of any warranty or representation contained in Article 12. In case
any action, suit or proceeding is brought against Lessor by reason of such occurrence, Lessee
will, at Lessee's expense and discretion, either defend such action, suit or proceeding, or cause
the same to be defended by counsel approved by Lessor, which approval will not be unreasonably
withheld.
13.3 Survival. The obligations and liabilities under this Article shall survive and
continue in full force and effect and shall not be terminated, discharged or released, in whole or
in part, irrespective of the termination or expiration of the term of this Lease.
ARTICLE 14
CONDEMNATION
14.1 Entire Condemnation. If at any time during the term of this Lease all or
substantially all of the Demised Premises or the Improvements thereon shall be taken in the
exercise of the power of eminent domain by any sovereign, municipality or other public or
private authority, then this Lease shall terminate on the date of vesting of title in such taking and
any prepaid rent shall be apportioned as of said date. Substantially all of the Demised Premises
and the Improvements thereon shall be deemed to have been taken if the remaining portion of the
Demised Premises shall not be of sufficient size to permit Lessee, in Lessee's sole discretion, to
operate its business thereon in a manner similar to that prior to such taking.
14.2 Allocation of Award. Any award for such taking of all or substantially all of the
Demised Premises shall be paid to the parties hereto in accordance with the following:
A. To Lessor, the amount of the award attributable to the Demised Premises,
determined as if this Lease was not in effect at the time of such award, excluding
therefrom the amount of the award attributable to the Improvements, and all other sums
not directly attributable to the value of the Land constituting the Demised Premises;
B. To Lessee, the entire award except that portion allocated to Lessor above.
14.3 Partial Condemnation. If less than all or substantially all of the Demised Premises
or the Improvements thereon shall be taken in the exercise of the power of eminent domain by
any sovereign, municipality or other public or private authority, then Lessee, at its option, may
elect to continue this Lease in full force and effect or terminate this Lease. If Lessee shall elect to
maintain this Lease in full force and effect, the award for such partial condemnation shall be
allocated as provided in Section 14.2, and Lessee shall proceed with reasonable diligence to carry
out any necessary repair and restoration so that the remaining Improvements and appurtenances
shall constitute a complete structural unit or units which can be operated on an economically
feasible basis under the provisions of this Lease. In the event Lessee elects to continue this Lease
in full force and effect after a partial condemnation, the Base Rent shall be reduced in proportion
to the area of the Demised Premises taken.
Should Lessee elect to terminate this Lease upon a partial condemnation, Lessee shall
provide Lessor with written notice of such election within thirty (30) days after the date of
vesting of title for such taking. Lessee shall specify in such written notice the date on which this
Lease shall terminate, which date shall be not less than 60 days nor more than 360 days after
delivery of such notice to Lessor (the "Termination Date"). In the event Lessee terminates this
Lease, as provided for in this Section 13.3, Lessee shall be entitled to the entire award for such
partial taking.
14.4 Temporary Taking. If the temporary use of the whole or any part of the Demised
Premises or the Improvements thereon or the appurtenances thereto shall be taken at any time
during the term of this Lease in the exercise of the power of eminent domain by any sovereign,
municipality, or other authority, the term of this Lease shall not be reduced or affected in any
way, and Lessee shall continue to pay in full the rent, additional rent and other sum or sums of
money and charges herein reserved and provided to be paid by Lessee, and the entire award for
such temporary taking shall be paid to Lessee. Lessee shall repair and restore any and all damage
to the Demised Premises and the Improvements as soon as reasonably practicable after such
temporary taking.
14.5 Effect of Taking. If any taking renders the construction of the hotel and/or water
park impossible, any financial penalties set forth in Section 1.3 due after such taking shall not be
applicable.
ARTICLE 15
ASSIGNMENT AND SUBLETTING
Prior to the issuance of the Certificate of Completion (as defined in Section 3.4 of the
Development Agreement) for the Minimum Improvements, this Lease may not be assigned by
Lessee without the prior written consent of the Lessor. After the issuance of the Certificate of
Completion, the Lessee shall have the right to transfer and assign this Lease to a third party,
subject to the consent of Lessor which consent shall not be unreasonably withheld, provided said
third party agrees to comply with the terms and conditions of this Lease.
ARTICLE 16
DEFAULT
16.1 Lessor's Rights 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 default 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, but in no event longer
than ninety (90) days), then and in any such event, Lessor shall have the right at its option, on
written notice to Lessee, to terminate this Lease. Lessor shall thereafter have the right to enter
and take possession of the Demised Premises with process of law and to remove all personal
property from the Demised Premises and all persons occupying the Demised Premises and to use
all necessary force therefor and in all respects to take the actual, full and exclusive possession of
the Demised Premises and every part of the Demised Premises as of Lessor's original estate,
without incurring any liability to Lessee or to any persons occupying or using the Demised
Premises for any damage caused or sustained by reason of such entry on the Demised Premises or
the removal of persons or property from the Demised Premises.
16.2 Rights of Holder of Encumbrance in Event Lessee Defaults. If Lessee fails or
neglects 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, the Holder of any indebtedness secured by an
encumbrance on the leasehold estate under this Lease shall have thirty (30) days after receipt of
written notice from Lessor setting forth the nature of Lessee's default and a reasonable time
thereafter if it shall have commenced foreclosure or other appropriate proceedings in the nature
thereof within such thirty (30) days and is diligently prosecuting such proceedings, but in no
event longer than ninety (90) days, within which to endeavor to make good or remove the default
or cause for termination of the Lease. All right of Lessor to terminate this Lease on the failure or
neglect of Lessee to observe, keep and perform the covenants, terms and conditions of this Lease
is, and shall continue to be, at all times prior to payment in full of the indebtedness to the Holder
of Lessee, subject to and conditioned on Lessor's having first given the Holder written notice
thereof and the Holder having failed to cause the default or cause for termination to be made
good or removed within thirty (30) days after receiving written notice of default or cause for
termination or within a reasonable time thereafter if it shall have commenced foreclosure or other
appropriate proceedings in the nature of foreclosure within such thirty (30) days and is diligently
prosecuting such proceedings, but in no event longer than ninety (90) days. In the event that the
Lease is terminated due to the Lessee's bankruptcy, insolvency or other proceedings, and in the
event the Holder has complied with the terms of this Section 16.2, then Lessor at Holder's
option, shall enter into a new lease with Holder or the successful bidder at foreclosure on the
same terms as this Lease, for the term then remaining, and specifically preserving all unexercised
options.
16.3 Lessee's Rights in the Event of Lessee's Default. If Lessor 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 Lessee setting forth the nature of Lessor's default (it being intended
that in connection with a default not susceptible of being cured with diligence within thirty (30)
days, the time within which Lessor has to cure the same shall be extended for such period as may
be necessary to complete the same with all due diligence, but in no event longer than ninety (90)
days), then and in any such event, Lessee shall have all rights available to it provided by law or
equity.
ARTICLE 17
RIGHT TO CURE OTHER'S DEFAULTS
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, following thirty (30) days' prior written notice to such defaulting party (or such
additional time to cure as may be accorded Lessee pursuant to Section 16.1 above, but in no
event longer than ninety (90) days), 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 Demised
Premises 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.
ARTICLE 18
QUIET ENJOYMENT
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 Demised Premises or any part thereof shall
not be disturbed by any act of Lessor, or of anyone acting by, through or under Lessor.
ARTICLE 19
ESTOPPEL CERTIFICA 1'bS
Each party hereto agrees that at any time and from time to time during the term of this
Lease, within ten (10) days after request by the other party hereto or by any lender having an
interest in Lessee's leasehold estate, it will execute, acknowledge and deliver to the other party or
to such lender or any prospective purchaser, assignee or any mortgagee designated by such other
party, a certificate stating (a) that this Lease is unmodified and in force and effect (or if there
have been modifications, that this Lease is in force and effect as modified, and identifying the
modification agreements), (b) the date to which rent has been paid, (c) whether or not there is any
existing default by Lessee in the payment of any rent or other sum of money hereunder, and
whether or not there is any other existing default by either party hereto with respect to which a
notice of default has been served, and, if there is any such default, specifying the nature and
extent thereof; and (d) whether or not there are any setoffs, defenses or counterclaims against
enforcement of the obligations to be performed hereunder existing in favor of the party executing
such certificate.
ARTICLE 20
WAIVER
No waiver by either party hereto of any breach by the other of any term, covenant,
condition or agreement herein and no failure by any party 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 the other party 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 Demised Premises, or to invoke
any other appropriate remedy which Lessor may select as herein or by law provided.
ARTICLE 21
SURRENDER
Lessee shall, on the last day of the term of this Lease or upon any termination of this
Lease, surrender and deliver up the Demised Premises, with the Improvements then located
thereon into the possession and use of Lessor, without fraud or delay and in good order, condition
and repair, reasonable wear and tear excepted, free and clear of all lettings 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 Demised Premises at the time of the surrender, or for the contents thereof or
appurtenances thereto. Lessee's Trade Fixtures, personal property and other belongings of Lessee
or of any sublessee or other occupant of space in the Demised Premises shall be and remain the
property of Lessee, and Lessee shall have a reasonable time after the expiration of the term of
this Lease (not to exceed thirty (30) days) to remove the same.
ARTICLE 22
MEMORANDUM OF LEASE
Each of the parties hereto will, promptly upon request of the other, execute a
memorandum of this Lease in a form suitable for recording setting forth the names of the parties
hereto and the term of this Lease, identifying the Demised Premises, and also including such
other clauses therein as either party may desire, except the amounts of Basic Rent payable
hereunder.
ARTICLE 23
NOTICES
23.1 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 by facsimile addressed as follows:
TO LESSOR: City of Dubuque, Iowa
City Manager
City Hall
13th and Central Avenue
Dubuque IA 42001
Fax 319 589-4149
TO LESSEE: Platinum Holdings, LLC
801 Jackson St.
Dubuque, IA 52001
23.2 The address and/or fax number 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 24
MISCELLANEOUS
24.1 Time of the Essence. Time is of the essence of this Lease and all of its provisions.
24.2 Governing Law. It is agreed that this Lease shall be governed by, construed and
enforced in accordance with the laws of the State of Iowa.
24.3 Paragraph Headings. 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.
24.4 Modification of Agreement. 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.
24.5 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.
24.6 Force Majeure. In the event that either party hereto shall be delayed or hindered
in or prevented from the performance of any act required hereunder by reason of strikes,
lockouts, labor troubles, unavailability of construction materials, unavailability or excessive price
of fuel, power failure, riots, insurrection, war, terrorist activities, explosions, hazardous
conditions, fire, flood, weather or acts of God, or by reason of any other cause beyond the
exclusive and reasonable control of the party delayed in performing work or doing acts required
under the terms of this Lease (collectively "Force Majeure"), then performance of such act shall
be excused for the period of the delay and the period for the performance of any such act shall be
extended for a period equivalent to the period of such delay.
24.7 Conflict. To the extent there is a conflict of terms between the Development
Agreement and this Lease, the terms of the Development Agreement shall control.
24.8 Entire Agreement. This Agreement, along with the Development Agreement and
Minimum Assessment Agreement, constitutes the entire agreement between the Lessor and the
Lessee regarding the lease of the Demised Premises and supercedes all previous oral or written
agreements between the parties regarding the subject matter of this Lease.
Attest:
LESSOR:
CITY OF DUBUQUE, IOWA
W.g4/7//'�� By:
eanne F. Schneider, City Clerk
J • kph . Robbins, Mayor Pro Tem
LESSEE:
PLATINUM HOLDINGS, LLC
By:
J. rri- P. Rix, Manager
STA I OF IOWA, DUBUQUE COUNTY) ss:
On this %/Vday of , 2001, before me, the undersigned, a Notary Public
in and for the State of Iow., •ersonally appeared James P. Rix, to me personally known, who
being by me duly sworn, did say that he is the Manager of the limited liability company
executing the within and foregoing instrument to which this is attached; that said instrument was
signed on behalf of the limited liability company by authority of its Managers; and that James P.
Rix, as Manager, acknowledged the execution of the foregoing instrument to be the voluntary act
and deed of the limited liability company, by it and by him vo tarily executed.
otary Public, State of Iowa
STATE OF IOWA, DUBUQUE COUNTY) ss:
On this V day of i6/1v=(•Y , 2001, before me, the undersigned, a Notary Public
in and for the State of Iowa; personally appeared James T. Robbins and Jeanne F. Schneider, to
me personally known, who, being by me duly sworn, did say that they are the Mayor Pro Temp
and City Clerk, respectively, of the City of Dubuque, Iowa, executing the within and foregoing
instrument, that no seal has been procured by the corporation; that said instrument was signed on
behalf of the City by authority of its City Council; and that Joseph T. Robbins and Jeanne F.
Schneider, as Mayor Pro Tem and City Clerk, respectively, acknowledged the execution of the
foregoing instrument to be the voluntary act and deed of the City, by it and by them voluntarily
executed.
Notary Public, State of Iowa
EXHIBIT "A"
LEGAL DESCRIPTION OF DEMISED PREMISES