Tri-State Industries - Develop Agree Heller Family Realty Co.
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MEMORANDUM
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June 24, 2005
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TO:
The Honorable Mayor and City Council Members
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FROM:
Michael C. Van Milligen, City Manager
SUBJECT: Approval of Development Agreement by and between the City and the
Heller Family Realty Company, LLC for the Sale and Development of
Property in the Dubuque Industrial Center West
Economic Development Director David Heiar recommends City Council approval of a
Development Agreement with the Heller Family Realty Company, LLC for the sale and
development of Lot 3 of Dubuque Industrial Center West 3rd Addition for the relocation
of Tri-State Industries, which is being displaced by the Julien Dubuque Bridge project.
The key elements of the Development Agreement include:
1. The property will be conveyed on or before August 1 , 2005.
2. The company must construct a building of not less than 50,000 square feet
costing not less than $1,400,000.
3. The company will make best efforts to maintain its existing 17 employees in the
city.
4. The full purchase price of the property will be offset by an Acquisition Grant to
the company in return for relinquishing the right to repurchase the South Main
Street Tri-State Industries property purchased by lOOT as part of the Julien
Dubuque Bridge project.
5. The company will receive a 1 O-year TIF in the form of a yearly tax rebate on the
value of the new assessable improvements.
6. The City will assist the project by solving a site drainage issue to divert off-site
drainage from adjacent City-owned, or previously City-owned property that
impacts the buildability of the property.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
(,/11 ,{ I; /1'1 Of!;; /
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Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
David Heiar, Economic Development Director
CITY OF DUBUQUE, IOWA
MEMORANDUM
June 24, 2005
TO: Michael Van Milligen, City Manager
FROM: David Heiar, Economic Developm~~
SUBJECT: Approval of Development Agreement by and between the City and
the Heller Family Realty Company, LLC for the Sale and Development
of Property in the Dubuque Industrial Center West
INTRODUCTION
This memorandum presents for City Council consideration a Resolution approving the
Development Agreement for the disposition of approximately 5.57 acres in the Dubuque
Industrial Center West to the Heller Family Realty Company, LLC. A public hearing on
the disposition of this property has been set for July 5, 2005.
BACKGROUND
On June 20, the City Council was presented with the attached memorandum
recommending that a public hearing be set for July 5 on the proposed disposition of the
above-described property to the Heller Family Realty Company, LLC to facilitate the
construction of a 50,000 square foot industrial building for Tri-State Industries, owned
and operated by Richard Heller. The Council received the memorandum and set the
matter for hearing.
DISCUSSION
Attached to this memorandum is a Resolution approving the proposed Development
Agreement and authorizing execution of the Agreement and deed.
The proposed Development Agreement establishes the terms of the sale of the property
to the company. The key elements of the agreement include the following:
1) The property will be conveyed on or before August 1, 2005.
2) The company must construct a building of not less than 50,000 square feet
costing not less than $1,400,000.
3) The company will make best efforts to maintain its existing 17 employees in the
city.
4) The full purchase price of the property will be offset by an Acquisition Grant to
the company in return for relinquishing the right to repurchase the South Main
Street Tri-State Industries property purchased by IDOT as part of the Julien
Dubuque Bridge project.
5) The company will receive a 1 O-year TIF in the form of a yearly tax rebate on the
value of the new assessable improvements.
6) The City will assist the project by solving a site drainage issue to divert off-site
drainage from adjacent City-owned, or previously City-owned, property that
impacts the buildability of the property.
RECOMMENDATION
I recommend that the City Council approve the Development Agreement with the Heller
Family Realty Company, LLC for the sale and development of Lot 3 of Dubuque
Industrial Center West 3rd Addition for the relocation of Tri-State Industries. The
company is being displaced by the Julien Dubuque Bridge project and relocation to the
west-side industrial park will assist the local business expand its operations and
maintain jobs in Dubuque.
ACTION STEP
The action step for the City Council is to adopt the attached Resolution.
attachments
F :\USERS\Pmyhre\WPDOCS\LOANDOC\Tri-States\final.dispo.memo. rtf
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Prepared by: Pamela Myhre City Hall. 50 W. 13th Street DubuQue. IA 52001 563-589-4213
RESOLUTION NO. 312-05
RESOLUTION APPROVING A DEVELOPMENT AGREEMENT PROVIDING FOR
THE SALE AND PRIVATE DEVELOPMENT OF LOT 3 OF DUBUQUE
INDUSTRIAL CENTER WEST 3RD ADDITION IN THE CITY OF DUBUQUE,
IOWA, TO THE HELLER FAMILY REALTY COMPANY, LLC.
Whereas, this Council, by Resolution No. 282 - 05 dated June 20, 2005, declared its intent
to enter into a Development Agreement with the Heller Family Realty Company, LLC for the sale
and development of Lot 3 of Dubuque Industrial Center West 3rd Addition in the City of Dubuque,
Iowa, as shown on the attached plat (the Property); and
Whereas, pursuant to published notice, a public hearing was held on the proposed
dis~osition on July 5, 2005, at 6:30 p.m. at the Carnegie-Stout Public Library Auditorium, 360 W.
111 Street, Dubuque, Iowa; and
Whereas, it is the determination of this Council that approval of the Development
Agreement for the sale to and development of the property by the Heller Family Realty Company,
LLC according to the terms and conditions set out in the attached Development Agreement is in the
public interest of the citizens of the City.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the attached Development Agreement by and between the City of Dubuque
and the Heller Family Realty Company, LLC and the sale of the Property to the Heller Family
Realty Company, LLC are hereby approved.
Section 2. That the Mayor is hereby authorized and directed to execute the Development
Agreement on behalf of the City and City Clerk is authorized and directed to attest to his signature.
Section 3. That the Mayor and City Clerk are hereby authorized and directed to execute
and deliver a Special Warranty Deed for the Property as provided in the Development Agreement.
Section 4. That the City Manager is authorized to take such actions as are necessary to
comply with the terms of the Development Agreement as herein approved.
Passed, approved and adopted this 5th day of July 2005.
Terrance M. Duggan, Mayor
Attest:
Jeanne F. Schneider, City Clerk
F:\USERS\Pmyhre\WPDOCS\LOANDOC\Tri-States\finaldispo. res. doc
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MEMORANDUM
June 14,2005
TO:
The Honorable Mayor and City Council Members
FROM:
Michael C. Van Milligen, City Manager
SUBJECT: Relocation of Tri-State Industries to the Dubuque Industrial Center West
Economic Development Director David Heiar recommends City Council approval to set
a public hearing for July 5,2005, to dispose of Lot 3 of Dubuque Industrial Center West
3rd Addition to the Heller Family Realty Company, LLC for the purpose of constructing a
50,000 square foot industrial building for Tri-State Industries. Tri-State Industries'
current property has been purchased by the Iowa Department of Transportation for the
Julien Dubuque Bridge expansion project. This project will assist in the retention of 17
jobs.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
(11j {{~tL
Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
David Heiar, Economic Development Director
CITY OF DUBUQUE, IOWA
MEMORANDUM
June 14, 2005
TO:
FROM:
Michael Van Milligen, City Manager
David Heiar, Economic Development Directo~~ .
Relocation of Tri-State Industries to the Dubuque Industrial Center
West
SUBJECT:
INTRODUCTION
This memorandum presents for City Council consideration, a Resolution initiating
disposition of approximately 5.57 acres identified on the attached exhibit to the Heller
Family Realty Company, LLC to construct a 50,000square foot industrial building for
Tri-State Industries, owned and operated by Richard Heller, at the Dubuque Industrial
Center West (DICW). The attached Resolution sets a public hearing on the disposition
of this property for July 5, 2005.
BACKGROUND
City staff has worked for several months to accommodate the relocation of Tri-State
Industries from their current location on South Main Street to the industrial park. The
metal fabrication company's current property has been purchased by the Iowa
Department of Transportation (lOOT) for the Julien Dubuque Bridge expansion project
which has necessitated the move.
The City has replatted a 26-acre lot directly across from the McGraw Hill development in
the DICW to create 4 smaller lots. A new cul-de-sac will also be constructed to provide
access to these new lots. The final plat and improvement plans for the street and
utilities will be presented to the City Council for their approval at the July 5, 2005
meeting.
DISCUSSION
The proposed Development Agreement provides for several incentives to make
possible the relocation of the company which has pledged to maintain its existing 17
employees in Dubuque. An Acquisition Grant to the Developer offsets the full asking
price of the land. In return, the City has a first right to repurchase the South Main
property from IDOT when it is made available for sale. Typically, the prior property
owner is afforded that right, but it will be waived by the company.
A 1 O-year tax rebate has been offered to the company to assist in the relocation. As the
company pays its future tax obligation on the new improvements, the City will rebate
100% of the new TIF increment for a 1 O-year period.
The City will also assist the project by solving a site drainage issue to divert off-site
drainage from adjacent City-owned, or previously City-owned, property that impacts the
buildability of this parcel.
Additional terms and conditions of the disposition of the property are included within the
attached Development Agreement.
RECOMMENDATION
I recommend that the City Council set for public hearing the disposition of Lot 3 of
Dubuque Industrial Center West 3rd Addition to the Heller Family Realty Company, LLC
for the purpose of constructing a 50,000 square foot industrial building for Tri-State
Industries. This action supports the Council's objectives to assist local business
expansion.
ACTION STEP
The action step for the City Council is to adopt the attache,d Resolution.
attachments
F :\US ERS\Pmyh re\WPDOCS\LOANDOC\Tri-States\dispo .memo.rtf
RESOLUTION NO.
RESOLUTION OF INTENT TO DISPOSE OF AN INTEREST IN REAL
PROPERTY IN THE DUBUQUE INDUSTRIAL CENTER WEST BY SALE TO
THE HELLER FAMILY REALTY COMPANY, LLC PURSUANT TO A
DEVELOPMENT AGREEMENT.
WHEREAS, the City of Dubuque, Iowa (City) is the owner of the following real
property (the Property), as shown on the Exhibit attached hereto consisting of 5.57
acres, more or less, the legal description of which is
Lot 3 of Dubuque Industrial Center West 3rd Addition; and
WHEREAS, City and the Heller Family Realty Company, LLC (Company) have
entered into a Development Agreement, subject to the approval of the City Council, a
copy of which is on file at the Office of the City Clerk, City Hall, 50 W. 13th Street,
Dubuque, Iowa pursuant to which City will sell the Property to Company; and
WHEREAS, the City Council has tentatively determined that it would be in the
best interests of City to approve the Development Agreement, including conveyance of
the Property to Company.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA:
Section 1. The City of Dubuque intends to dispose of its interest in the foregoing-
described Property to the Heller Family Realty Company, LLC.
Section 2. The City Clerk is hereby authorized and directed to cause this
Resolution and a notice to be published as prescribed by Iowa Code Section 364.7 of a
public hearing on City's intent to dispose of the foregoing-described Property, to be held
on the 5th day of July, 2005, at 6:30 p.m. at the Carnegie-Stout Public Library
Auditorium, 360 W. 11th Street, Dubuque, Iowa.
Passed, approved and adopted this 20th day of June, 2005.
Terrance M. Duggan
Mayor
ATTEST:
Jeanne F. Schneider
City Clerk
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DEVELOPMENT AGREEMENT
AGREEMENT, made on or as of the _ day of , 2005
("Effective Date"), by and between the City of Dubuque, Iowa, a municipality
("City"), established pursuant to the Iowa Code and acting under authorization of
Iowa Code Chapter 403, as amended ("Urban Renewal Act"), and Heller Family
Realty Company, LLC, an Iowa limited liability company with its principal place of
business at Dubuque, Iowa ("Developer").
WITNESSETH:
WHEREAS, in furtherance of the objectives of the Urban Renewal Act, City
has undertaken an Urban Renewal project ("the Project") to advance the
community's ongoing economic development efforts; and
WHEREAS, the Project is located within the Dubuque Industrial Center
Economic Development District ("the 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 for the Dubuque Industrial Center Economic Development
District, approved by City Council of City on May 2, 1988, and as subsequently
amended through and including the date hereof, (as amended, attached hereto as
Exhibit A)("the Urban Renewal Plan"); and
WHEREAS, a copy of the Urban Renewal Plan, as constituted on the date of
this Agreement and in the form attached hereto, has been recorded among the land
records in the office of the Recorder of Dubuque County, Iowa; and
WHEREAS, Developer has determined that it requires new manufacturing
space to maintain and expand its operations and employment in the Project Area;
and
WHEREAS, Developer has requested that City sell to Developer
approximately five (5) acres, more or less, legally described as Lot 2 Dubuque
Industrial Center West 3rd Addition identified on Exhibit 8, attached, in the City of
Dubuque, Dubuque County, Iowa, together with all easements, tenements,
hereditaments, and appurtenances belonging thereto ("the Property"), so that
Developer may develop the Property, located in the Project Area, for the
construction, use and occupancy of an industrial manufacturing building with
appurtenant uses which the City has determined and represented to Developer is in
accordance with the uses specified in the Urban Renewal Plan and in accordance
with this Agreement; and
WHEREAS, City believes that the development of the Property pursuant to
this Agreement, and the fulfillment generally of this Agreement, are in the vital and
best interests of City and in accord with the public purposes and provisions of the
applicable federal, state and local laws and the requirements under which the
Project has been undertaken and is being assisted.
NOW THEREFORE, in consideration of the premises and the mutual
obligations of the parties hereto, each of them does hereby covenant and agree
with the other as follows:
SECTION 1. CONVEYANCE OF PROPERTY TO DEVELOPER
1.1 Purchase Price. The purchase price for the Property ("the Purchase Price")
shall be the sum of Seventy-Eight Thousand Dollars ($78,000.00) per acre, which
shall be due and payable by Developer in immediately available funds in favor of
City, on or before August 1, 2005, or on such other date as the parties may
mutually agree ("the Closing Date").
1.2 Title to Be Delivered. City agrees to convey good and marketable fee simple
title in the Property to Developer subject only to easements, restrictions, conditions
and covenants of record as of the date hereof to the extent not objected to by
Developer as set forth in this Agreement, and to the conditions subsequent set forth
in Section 5.3, below:
(1) City, at its sole cost and expense, shall deliver to Developer an
abstract of title to the Property continued through the date of this Agreement
reflecting merchantable title in City in conformity with this Agreement and
applicable state law. The abstract shall be delivered together with full copies
of any and all encumbrances and matters of record applicable to the
Property, and such abstract shall become the property of Developer when
the Purchase Price is paid in full in the manner as aforesaid.
(2) Developer shall have until time ofthe Closing Date to render
objections to title, including any easements or other encumbrances not
satisfactory to Developer, in writing to City. Developer agrees, however, to .
review the Abstract promptly following Developer's receipt of Developer's
land survey and the Abstract and to promptly provide City with any objections
to title identified therein. Nothing herein shall be deemed to limit Developer's
rights to raise new title objections with respect to matters revealed in any
subsequent title examinations and surveys and which were not identified in
the Abstract provided by the City. City shall promptly exercise its best efforts
to have such title objections removed or satisfied and shall advise Developer
of intended action within ten (10) days of such action. If City shall fail to
have such objections removed as of the Closing Date, or any extension
thereof consented to by Developer, Developer may, at its sole discretion,
2
either (a) terminate this Agreement without any liability on its part, and any
sums previously paid to City by Developer (or paid into escrow for City's
benefit) shall be returned to Developer with interest, or (b) take title subject
to such objections. City agrees to use its best reasonable efforts to promptly
satisfy any such objections.
1.3 Riqhts of Inspection. Testinq and Review. Developer, its counsel,
accountants, agents and other representatives, shall have full and continuing
access to the Property and all parts thereof, upon reasonable notice to City.
Developer and its agent and representatives shall also have the right to enter upon
Property at any time after the execution and delivery hereof for any purpose
whatsoever, including inspecting, surveying, engineering, test boring, performance
of environmental tests, provided that Developer shall hold City harmless and fully
indemnify City against any damage, claim, liability or cause of action arising from or
caused by the actions of Developer, its agents, or representatives upon the
Property (except for any damage, claim, liability or cause of action arising from
conditions existing prior to any such entry upon the Property), and shall have the
further right to make such inquiries of governmental agencies and utility companies,
etc. and to make such feasibility studies and analyses as it considers appropriate.
1.4 Representations and Warranties of City. In order to induce Developer to
enter into this Agreement and purchase the Property, City hereby represents and
warrants to Developer that to the best of City's knowledge:
(1) There is no action, suit or proceeding pending, or to the best of City's
knowledge, threatened against City which might result in any adverse
change in the Property being conveyed or the possession, use or enjoyment
thereof by Developer, including, but not limited to, any action in
condemnation, eminent domain or public taking.
(2) No ordinance or hearing is now or before any local governmental
body that either contemplates or authorizes any public improvements or
special tax levies, the cost of which may be assessed against the Property.
To the best of City's knowledge, there are no plans or efforts by any
government agency to widen, modify, or re-align any street or highway
providing access to the Property and there are no pending or intended public
improvements or special assessments affecting the Property which will result
in any charge or lien be levied or assessed against the Property.
(3) All leases, contracts, licenses, and permits between City and third
parties in connection with the maintenance, use, and operation of the
Property have been provided to Developer and City has provided true and
correct copies of all such documents to Developer.
(4) City has good and marketable fee simple title interest to the Property.
3
(5) The Property has a permanent right of ingress or egress to a public
roadway for the use and enjoyment of the Property.
(6) There are no notices, orders, suits, judgments or other proceedings
relating to fire, building, zoning, air pollution, health violations or other
matters that have not been corrected. City has notified Developer in writing
of any past notices, orders, suits, judgments or other proceedings relating to
fire, building, zoning, air pollution or health violations as they relate to the
Property of which it has actual notice. The Property is in material
compliance with all applicable zoning, fire, building, and health statutes,
ordinances, and regulations.
(7) Payment has been made for all labor or materials that have been
furnished to the Property or will be made prior to the Closing Date so that no
lien for labor performed or materials furnished can be asserted against the
Property.
(8) The Property will as of the Closing Date be free and clear of all liens,
security interests, and encumbrances.
(9) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated by this Agreement do not
and shall not result in any material breach of any terms or conditions of any
mortgage, bond, indenture, agreement, contract, license, or other instrument
or obligation to which City is a party or by which either the City or the
Property being conveyed are bound, nor shall the execution, delivery and
performance of this Agreement violate any statute, regulation, judgment, writ,
injunction or decree of any court threatened or entered in a proceeding or
action in which City may be bound or to which either City or the Property
being conveyed may be subject.
(10) City has duly obtained all necessary approvals and consents for its
execution, delivery and performance of this Agreement, and that it has full
power and authority to execute, deliver and perform its obligations under this
Agreement. City's attorney shall issue a legal opinion to Developer at time of
closing confirming the representation contained herein, in form and
substance reasonably satisfactory to Developer.
(11) City water and storm sewer necessary for the development and use of
the Property as an industrial manufacturing facility shall be available to
Developer by November 15, 2005, and Developer shall have the right to tie
into said utilities.
4
(12) The Property is free and clear of any occupants, and no party has a
lease to or other occupancy or contract right in the Property that shall in
anyway be binding upon the Property or Developer.
(13) City represents and warrants that any fees or other compensation
which may be owed to a broker engaged directly or indirectly by City in
connection with the purchase and sale contemplated in this Agreement are
the sole responsibility and obligation of City and that City will indemnify
Developer and hold Developer harmless from any and all claims asserted by
any broker engaged directly or indirectly by City for any fees or other
compensation related to the subject matter of this Agreement.
(14) City shall exercise its best efforts to cooperate with Developer in the
development process.
(15) City shall exercise its best efforts to resolve any disputes arising
during the development process in a reasonable and prompt fashion.
(16) With respect to the period during which City has owned or occupied
the Property, and to City's knowledge after reasonable investigation with
respect to the time before City owned or occupied the Property, no person or
entity has caused or permitted materials to be stored, deposited, treated,
recycled, or disposed of on, under or at the Property, which materials, if
known to be present, would require cleanup, removal or some other remedial
action under environmental laws.
(17) The representations and warranties contained in this article shall be
correct in all respects on and as of the Closing Date with the same force and
effect as if such representations and warranties had been made on and as of
the Closing Date.
1.5 Conditions to Closinq. The closing of the transaction contemplated by this
Agreement and all the obligations of Developer 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 1.4 shall
be correct as of the Closing Date with the same force and effect as if such
representations were made at such time. At the closing, City shall deliver a
certificate to that effect.
(2) Title to the Property shall be in the condition warranted in Section 1.4.
(3) Developer, in its sole and absolute discretion, having completed and
approved of any inspections done by Developer hereunder.
5
(4) Developer having obtained any and all necessary governmental
approvals, including without limitations approval of zoning, subdivision or
platting which might be necessary or desirable in connection with the sale
and transfer and development of the Property. Any conditions imposed as a
part of the zoning, platting or subdivision must be satisfactory to Developer,
in its sole opinion. City shall cooperate with Developer in attempting to
obtain any such approvals and shall execute any documents necessary for
this purpose, provided that City shall bear no expense in connection
therewith. In connection therewith, the City agrees (a) to review all of
Developer's plans and specifications for the project and to either reject or
approve the same in a prompt and timely fashion; (b) to issue a written
notification to Developer, following City's approval of same, indicating that
the City has approved such plans and specifications, and that the same are
in compliance with the Urban Renewal Plan, this Agreement and any other
applicable City or affiliated agency requirements, with the understanding that
Developer and its lenders shall have the right to rely upon the same in
proceeding with the project; (c) to identify in writing within ten (10) working
days of submission of said plans and specifications, any and all permits,
approvals and consents that are legally required for the acquisition of the
Property by Developer, and the construction, use and occupancy of the
project with the intent and understanding that Developer and its lenders and
attorneys will rely upon same in establishing their agreement and time
frames for construction, use and occupancy, lending on the project and
issuing legal opinions in connection therewith; and (d) to cooperate fully with
Developer to streamline and facilitate the obtaining of such permits,
approvals and consents.
(5) City having completed all required notice to or prior approval, consent
or permission of any federal, state or municipal or local governmental
agency, body, board or official to the sale of the Property; and
consummation of the closing by City shall be deemed a representation and
warranty that it has obtained the same.
(6) Developer and City shall be in material compliance with all the terms
and provisions of this Agreement.
(7) Developer shall have furnished City with evidence, in a form
satisfactory to City (such as a letter of commitment from a bank or other
lending institution), that Developer has firm financial commitments in an
amount sufficient, together with equity commitments, to complete the
Minimum Improvements (as defined herein) in conformance with the
Construction Plans (as defined herein), or City shall have received such
other evidence of such party's financial ability as in the reasonable judgment
of City is required.
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(8) Receipt of an opinion of counsel to Developer in the form attached
hereto as Exhibit C.
(9) Developer shall have the right to terminate this Agreement at anytime
prior to the consummation of the closing on the Closing Date if Developer
determines in its sole discretion that conditions necessary for the successful
completion of the Project contemplated herein have not been satisfied to the
full satisfaction of such party in such party's sole and unfettered discretion.
Upon the giving of notice of termination by such terminating party to the
other parties to this Agreement, this Agreement shall be deemed null and
void.
1.6 Closinq. The closing of the purchase and sale shall take place on the
Closing Date. Exclusive possession of the Property shall be delivered on the
Closing Date, in its current condition and in compliance with this Agreement,
including City's representations and warranties regarding the same. Consummation
of the closing shall be deemed an agreement of the parties to this Agreement that
the conditions of closing shall have been satisfied or waived.
1.7 City's Obliqations at Closinq. At or prior to the Closing Date, City shall:
(1) Deliver to Developer City's duly recordable Special Warranty Deed to
the Property (in the form attached hereto as Exhibit 0 ("Deed") conveying to
Developer marketable fee simple title to the Property and all rights
appurtenant thereto, subject only to easements, restrictions, conditions and
covenants of record as of the date hereof and not objected to by Developer
as set forth in this Agreement, and to the conditions subsequent set forth in
Section 5.3 below.
(2) Deliver to Developer the Abstract of Title to the Property.
(3) Deliver to Developer such other documents as may be required by
this Agreement, all in a form satisfactory to Developer.
1.8 Delivery of Purchase Price: Obliqations At Closinq. At closing, and subject,
to the terms, conditions, and provisions hereof and the performance by City of its
obligations as set forth herein, Developer shall pay the Purchase Price to City
pursuant to Section 1.1 hereof, but subject to Developer receiving an offsetting
credit pursuant to Section 3.1 below.
1.9 Closinq Costs. The following costs and expenses shall be paid in connection
with the closing:
(1) City shall pay:
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(a)
(b)
1.10.
(c)
assessed.
(d)
(e)
The transfer fee, if any, imposed on the conveyance.
A pro-rata portion of all taxes, if any, as provided in Section
All special assessments, if any, whether levied, pending or
City's attorney's fees, if any.
City's broker and/or real estate commissions and fees, if any.
(f) The cost of recording the satisfaction of any existing mortgage
and any other document necessary to make title marketable.
(2) Developer shall pay the following costs in connection with the closing:
(a) The recording fee necessary to record the Deed.
(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 1.10.
1.10 Real Estate Taxes. City shall pay all real estate taxes for all fiscal years that
end prior to the Closing Date. Real estate taxes for the fiscal year in which the
Closing Date occurs shall be prorated between City and Developer to the Closing
Date on the basis of a 365-day calendar year. Developer shall payor cause to be
paid all real estate taxes due in subsequent fiscal years. Any proration of real
estate taxes on the Property shall be based upon such taxes for the year currently
payable.
SECTION 2. DEVELOPMENT ACTIVITIES
2.1 Required Minimum Improvements. City acknowledges that Developer is
building an industrial manufacturing facility on the Property. Specifically, Developer
is charged with constructing the building and certain internal systems thereto, and
with finishing the building including, without limitation, all interior improvements ("the
Minimum Improvements"); all as more particularly depicted and described on the
plans and specifications to be delivered to and approved by City as contemplated in
this Agreement. Developer hereby agrees to construct on the Property an industrial
manufacturing facility of not less than fifty thousand (50,000) square feet of floor
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space along with necessary sitework as contemplated in this Agreement at a cost of
not less than $1,400,000.00.
2.2 Plans for Construction of Minimum Improvements. Plans and specifications
with respect to the development of Property and the construction of Minimum
Improvements thereon ("the Construction Plans") shall be in conformity with Urban
Renewal Plan, this Agreement, and all applicable state and local laws and
regulations, including but not limited to the Amended and Restated Declaration of
Covenants, Conditions, Restrictions, Reservations, Easements, Liens and Charges,
recorded as Instrument No. 7990-02, records of Dubuque County, Iowa. Developer
shall submit to City, for approval by City, plans, drawings, specifications, and
related documents with respect to the 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.
2.3 Timinq of Improvements. Developer hereby agre.es that construction of
Minimum Improvements on the Property shall be commenced within three (3)
months after the Closing Date, and shall be substantially completed by March 31,
2006. The time frames for the performance of these obligations shall be
suspended due to unavoidable delays meaning delays, outside the control of the
party claiming its occurrence in good faith, which are the direct result of strikes,
other labor troubles, unusual shortages of materials or labor, unusually severe or
prolonged bad weather, acts of God, fire or other casualty to the Minimum
Improvements, litigation commenced by third parties which, by injunction or other
similar judicial action or by the exercise of reasonable discretion directly results in
delays, or acts of any federal, state or local government which directly result in
extraordinary delays. The time for performance of such obligations shall be
extended only for the period of such delay.
2.4 Certificate of Completion. Promptly following the request of Developer upon
completion of the Minimum Improvements, City shall furnish Developer with an
appropriate instrument so certifying. Such certification ("the Certificate of
Completion") shall be in recordable form and shall bea conclusive determination of
the satisfaction and termination of the agreements and covenants in this
Agreement and in the Deed with respect to the obligations of Developer to
construct Minimum Improvements. The Certificate of Completion shall waive all
rights of re-vestment of title in City as provided in Section 5.3, and the Certificate of
Completion shall so state.
2.5 Developer's Lender's Cure Riqhts. The parties agree that if Developer shall
fail to complete the Minimum Improvements as required by this Agreement such
that re-vestment of title may occur (or such that the City would have the option of
exercising its re-vestment rights), then Developer's lender shall have the right, but
not the obligation, to complete such Minimum Improvements.
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SECTION 3. CITY PARTICIPATION
3.1 Acquisition Grant to Developer. For and in consideration of Developer's
obligations hereunder to construct the Minimum Improvements, City agrees to
make an Acquisition Grant to Developer on the Closing Date, or such other date as
the parties shall mutually agree upon in writing, in the full amount of the Purchase
Price. The parties agree that the Acquisition Grant shall be payable in the form of a
credit favoring Developer at time of closing with the effect of directly offsetting the
full purchase price obligation of Developer.
3.2 Economic Development Grant to Developer.
(1) For and in consideration of Developer's obligations hereunder, and in
furtherance of the goals and objectives of the urban renewal plan for the
Project Area and the Urban Renewal Law, City agrees, subject to Developer
being and remaining in compliance with theterm~ of this Agreement, to
make twenty (20) consecutive semi-annual payments (such payments being
referred to collectively as "the Economic Development Grants") to the
Developer, commencing November 1,2007, and continuing until May 1,
2017, pursuant to Iowa Code Section 403.9 of the Urban Renewal Law, in
amounts equal to the actual amount of tax increment revenues paid by
Developer and collected by City under Iowa Code Section 403.19 (without
regard to any averaging that may otherwise be utilized under Iowa Code
Section 403.19 and excluding any interest that may accrue thereon prior to
payment to Developer) during the preceding six-month period in respect of
the Minimum Improvements constructed by Developer ("the Developer Tax
Increments").
(2) To fund the Economic Development Grants, City shall certify to the
County prior to December 1 of each year, commencing December 1, 2005,
its request for the available Developer Tax Increments resulting from the
assessments imposed by the County as of January 1 of the following year, to
be collected by City as taxes are paid during the following fiscal year and
which shall thereafter be disbursed to the Developer on November 1 and
May 1 of that fiscal year. (Example: if City so certifies by December, 2005, .
the Economic Development Grants in respect thereof would be paid to the
Developer on November 1, 2007, and May 1,2008.)
(3) The Economic Development Grants shall be payable from and
secured solely and only by the Developer Tax Increments paid to City that,
upon receipt, shall be deposited and held in a special account created for
such purpose and designated as the "Heller Family Realty Company TIF
Account" of City. City hereby covenants and agrees to maintain its TIF
ordinance in force during the term hereof and to apply the incremental taxes
collected in respect of the Minimum Improvements and allocated to the
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Heller Family Realty Company TIF Account to pay the Economic
Development Grants, as and to the extent set forth in Section 3.2(1) hereof.
The Economic Development Grants shall not be payable in any manner by
other tax increments revenues or by general taxation or from any other City
funds. City makes no representation with respect to the amounts that may
be paid to Developer as the Economic Development Grants in anyone year
and under no circumstances shall City in any manner be liable to Developer
so long as City timely applies the Developer Tax Increments actually
collected and held in the Heller Family Realty Company TIF Account
(regardless of the amounts thereof) to the payment of the Economic
Development Grants to Developer as and to the extent described in this
Section.
(4) City shall be free to use any and all tax increment revenues collected
in respect of other properties within the Project Area, or any available
Developer Tax Increments resulting from the termination of the annual
Economic Development Grants under Section 3.2 hereof, for any purpose for
which such tax increment revenues may lawfully be used pursuant to the
provisions of the Urban Renewal Law, and City shall have no obligations to
Developer with respect to the use thereof.
3.3 Site Gradinq Participation. City shall reimburse Developer for all of certain
costs to be incurred by Developer associated with diverting drainage from the
adjacent lot directly east of the Property. City shall approve the design and
specifications and costs Developer is to be reimbursed for such work by the Closing
Date..
3.4 Construction of Cul-De-Sac Street. City, at its expense, shall complete
construction of the cul-de-sac street from Chavenelle Road to serve the Property, at
no cost to Developer, by special assessment or otherwise.
SECTION 4. COVENANTS OF DEVELOPER
4.1 Job Creation. During the term of this Agreement, Developer shall make best
efforts to maintain its existing seventeen (17) employees in Dubuque, Iowa.
4.2 Books and Records. During the term of this Agreement, Developer shall
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 Developer in accordance with generally accepted accounting
principles consistently applied throughout the period involved, and Developer shall
provide reasonable protection against loss or damage to such books of record and
account.
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4.3 Real Property Taxes. From and after the Closing Date, Developer shall pay
or cause to be paid, when due, all real property taxes and assessments payable
with respect to all and any parts of the Property unless Developer's obligations have
been assumed by another person pursuant to the provisions of this Agreement.
4.4 No Other Exemptions. During the term of this Agreement, the Developer
agrees not to apply for any other state or local property tax exemptions which are
available with respect to the Development Property or the Minimum Improvements
located thereon that may now be, or hereafter become, available under state law or
city ordinance during the term of this Agreement, including those that arise under
Iowa Code Chapters 404 and 427, as amended.
4.5 Insurance Requirements. During the term of this Agreement,
(1) Developer shall provide and maintain or cause to be maintained at all
times during the process of constructing the Minimum Improvements (and,
from time to time at the request of City, furnish City with proof of insurance in
the form of a certificate of insurance for each insurance policy):
(a) All risk builder's risk insurance, written on a Completed Value
Form in an amount equal to one hundred percent (100%) of the
replacement value when construction is completed;
(b) Insurance as set forth in the attached Insurance Schedule.
(2) Upon completion of construction of the Minimum Improvements and
up to the Termination Date, Developer shall maintain, or cause to be
maintained, at its cost and expense (and from time to time at the request of
City shall furnish proof of insurance in the form of a certificate of insurance)
insurance as follows:
(a) All risk property insurance against loss and/or damage to
Minimum Improvements under an insurance policy written in an
amount not less than the full insurable replacement value of Minimum
Improvements. The term "replacement value" shall mean the actual,
replacement cost of the Minimum Improvements (excluding
foundation and excavation costs and costs of underground flues,
pipes, drains and other uninsurable items) and equipment, and shall
be reasonably determined from time to time at the request of City, but
not more frequently than once every three (3) years.
(b) Insurance as set forth in the attached Insurance Schedule.
(3) Developer agrees to notify City immediately in the case of damage
exceeding $50,000.00 in amount to, or destruction of, the Minimum
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Improvements or any portion thereof resulting from fire or other casualty.
The net proceeds of any such insurance ("the Net Proceeds"), shall be paid
directly to Developer as its interests may appear.
4.6 Preservation of Property. During the term of this Agreement, Developer shall
maintain, preserve and keep, or cause others to maintain, preserve and keep, the
Minimum Improvements in good repair and working order, ordinary wear and tear
accepted, and from time to time shall make all necessary repairs, replacements,
renewals and additions. Nothing in this Agreement, however, shall be deemed to
alter any agreements between Developer or any other party including, without
limitation, any agreements between the parties regarding the care and maintenance
of the Property.
4.7 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.
4.8 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. In connection with this
obligation, Developer shall have the right to rely upon the representations of any
party with whom it does business and shall not be obligated to perform any further
examination into such party's background.
4.9 Non-Transferability. Until such time as the Minimum Improvements are
complete (as certified by City under Section 2.4), this Agreement may not be
assigned by Developer nor may the Property be transferred by Developer to
another party without the prior written consent of City, which shall not be
unreasonably withheld. Thereafter, Developer shall have the right to assign this
Agreement and upon assumption of the Agreement by the assignee, Developer
shall no longer be responsible for its obligations under this Agreement.
4.10 Restrictions on Use. Developer agrees for itself, and its successors and
assigns, and every successor in interest to the Property or any part thereof that
they, and their respective successors and assigns, shall:
(1) Devote the Property to, and only to and in accordance with, the uses
specified in the Urban Renewal Plan (and City represents and agrees that
use of the Property as an industrial manufacturing center is in full
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compliance with the Urban Renewal Plan) (however, Developer shall not
have any liability to City to the extent that a successor in interest shall breach
this covenant and City shall seek enforcement of this covenant directly
against the party in breach of same); and
(2) Not discriminate upon the basis of race, religion, color, sex, national
origin, age or disability in the sale, lease, rental, use or occupancy of the
Property or any improvements erected or to be erected thereon, or any part
thereof (however, Developer shall not have any liability to City to the extent
that a successor in interest shall breach this covenant and City shall seek
enforcement of this covenant directly against the party in breach of same).
4.11 Release and Indemnification Covenants.
(1) Developer releases City and the governing body members, officers,
agents, servants and employees thereof (hereinafter, for purposes of this
Section, the "Indemnified Parties") from, covenants and agrees that the
Indemnified Parties shall not be liable for, and 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 the Minimum Improvements.
(2) Except for any gross negligence, willful misrepresentation or any
willful or wanton misconduct or any unlawful act of the Indemnified Parties,
Developer 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 (1) any
violation of any agreement or condition of this Agreement (except with
respect to any suit, action, demand or other proceeding brought by
Developer against City based on an alleged breach of any representation,
warranty or covenant of City under this Agreement and/or to enforce its
rights under this Agreement) or (2) the acquisition, construction, installation,
ownership, and operation of the Minimum Improvements or (3) the condition
of the Property and any hazardous substance or environmental
contamination located in or on the Property, occurring after Developer takes
possession of the Property.
(3) The Indemnified Parties shall not be liable to Developer for any
damage or injury to the persons or property of Developer or its officers,
agents, servants or employees or any other person who may be on, in or
about th~ 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.
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(4) All covenants, stipulations, promises, agreements and obligations of
City contained herein shall be deemed to be the covenants, stipulations,
promises, agreements and obligations of City, and not of any governing body
member, officer, agent, servant or employee of City in the individual capacity
thereof.
(5) The provisions of this Section shall survive the termination of this
Agreement.
4.12 Compliance with Laws. Developer shall comply with all laws, rules and
regulations relating to its businesses, other than laws, rules and regulations the
failure to comply with which or the sanctions and penalties resulting therefrom,
would not have a material adverse effect on the business, property, operations,
financial or otherwise, of Developer.
4.13 City's First Riqht to Purchase; Developer's First Riqht to Re-Purchase.
Developer agrees to complete and sign an Affidavit, attached hereto as Exhibit E,
provided by the Iowa Department of Transportation that relinquishes all rights as
given by Iowa Code Section 306.23 to property located at 10 South Main Street,
Dubuque, Iowa, legally described as:
Lots 1, 2, 3,4, 5, 6, 7, 8, and 9 (except the Easterly 20 feet of said
lots), in the Subdivision of the Westerly half of Block 14, and Lot A of
Block 14, and Lot 1 of Lot B of Block 19, in Dubuque Harbor Co.'s
Addition, in the City of Dubuque, Iowa, according to the recorded
Plats of said respective Subdivision; together with all easement rights
acquired by Sellers in a document recorded as No. 51532 on October
19, 1951, in the Recorder's Office in Dubuque County, Iowa,
(hereafter the "South Main Street Property") and grant such rights exclusively to
City.
SECTION 5. EVENTS OF DEFAULT AND REMEDIES
5.1 Events of Default Defined. The following shall be "Events of Default" under
this Agreement and the term "Event of Default" shall mean, whenever it is used in
this Agreement, anyone or more of the following events:
(1) Failure by Developer to payor cause to be paid, before delinquency,
all real property taxes assessed with respect to the Minimum Improvements
and the Property.
15
(2) Failure by Developer to cause the construction of the Minimum
Improvements to be commenced and completed pursuant to the terms,
conditions and limitations of this Agreement.
(3) Transfer of any interest by Developer of the Minimum Improvements
in violation of the provisions of this Agreement prior to the issuance of the
final Certificate of Completion.
(4) Failure by Developer or City to substantially observe or perform any
other material covenant, condition, obligation or agreement on its part to be
observed or performed under this Agreement.
5.2. Remedies on Default by Developer. Whenever any Event of Default referred
to in Section 5.1 of this Agreement occurs and is continuing, City, as specified
below, may take anyone or more of the following actions after the giving of written
notice by City to Developer (and the holder of any mortgage encumbering any
interest in the Property of which City has been notified of in writing) of the Event of
Default, but only if the Event of Default has not been cured within sixty (60) days
following such notice, or if the Event of Default cannot be cured within sixty (60)
days and Developer does not provide assurances to City that the Event of Default
will be cured as soon as reasonably possible thereafter:
(1) City may suspend its performance under this Agreement until it
receives assurances from the defaulting party deemed adequate by City, that
the defaulting party will cure its default and continue its performance under
this Agreement;
(2) Until the Closing Date, City may cancel and rescind this Agreement;
(3) City shall be entitled to recover from Developer the sum of all
amounts expended by City in connection with the funding of the Acquisition
Grant to Developer, and City may take any action, including any legal action
it deems necessary, to recover such amounts from the defaulting party;
(4) City may withhold the Certificate of Completion; or
(5) City may take any action, including legal, equitable or administrative
action, which may appear necessary or desirable to collect any payments
due under this Agreement or to enforce performance and observance of any
obligation, agreement, or covenant under this Agreement.
5.3 Re-Vestinq Title in City Upon Happeninq of Event Subsequent to
Conveyance to Developer. In the event that subsequent to conveyance of the
Property to Developer by City and prior to receipt by Developer of the Certificate of
Completion, but subject to the terms of the mortgage granted by Developer to
16
secure a loan obtained by Developer from a commercial lender or other financial
institution to fund the acquisition of Property or construction of the Minimum
Improvements, ("First Mortgage") an Event of Default under Section 5.1 of this
Agreement occurs and is not cured within the times specified in Section 5.2, then
City shall have the right to re-enter and take possession of the Property and any
portion of the Minimum Improvements thereon and to terminate (and re-vest in City
pursuant to the provisions of this Section 5.3 subject only to any superior rights in
any holder of the First Mortgage) the estate conveyed by City to Developer, it being
the intent of this provision, together with other provisions of this Agreement, that the
conveyance of the Property to Developer shall be made upon the condition that
(and the Deed shall contain a condition subsequent to the effect that), in the event
of default under Section 5.1 on the part of Developer and failure on the part of
Developer to cure such default within the period and in the manner stated herein,
City may declare a termination in favor of City of the title and of all Developer's
rights and interests in and to Property conveyed to Developer, and that such title
and all rights and interests of Developer, and any assigns or successors in interests
of Developer, and any assigns or successors in interest to and in Property, shall
revert to City (subject to the provisions of Section 5.3 of this Agreement), but only if
the events stated in Section 5.1 of this Agreement have not been cured within the
time period provided above, or, if the events cannot be cured within such time
periods, Developer does not provide assurance to City, reasonably satisfactory to
City, that the events will be cured as soon as reasonably possible. Notwithstanding
the foregoing, however, City agrees to execute a Subordination Agreement in favor
of Developer's first mortgage lender, in a form reasonably acceptable to City and to
Developer's first mortgage lender.
5.4 Resale of Reacquired Property; Disposition of Proceeds. Upon the re-
vesting in City of title to the Property as provided in Section 5.3 of this Agreement,
City shall, pursuant to its responsibility under law, use its best efforts, subject to any
rights or interests in such property or resale granted to any holder of a First
Mortgage, to resell the Property or part thereof as soon and in such manner as City
shall find feasible and consistent with the objectives of such law and of the Urban
Renewal Plan to a qualified and responsible party or parties (as determined by City
in its sole discretion) who will assume the obligation of making or completing the
Minimum Improvements or such other improvements in their stead as shall be
satisfactory to City and in accordance with the uses specified for such the Property
or part thereof in the Urban Renewal Plan. Subject to any rights or interests in such
property or proceeds granted to any holder of a First Mortgage upon such resale of
the Property the proceeds thereof shall be applied:
(1) First, to pay and discharge the First Mortgage;
(2) Second, to pay the principal and interest on mortgage(s) created on
the Property, or any portion thereof, or any improvements thereon,
previously acquiesced in by City pursuant to this Agreement. If more than
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one mortgage on the Property, or any portion thereof, or any improvements
thereon, has been previously acquiesced in by City pursuant to this
Agreement and insufficient proceeds of the resale exist to pay the principal
of, and interest on, each such mortgage in full, then such proceeds of the
resale as are available shall be used to pay the principal of and interest on
each such mortgage in their order of priority, or by mutual agreement of all
contending parties including Developer, or by operation of law;
(3) Third, to reimburse City for all allocable costs and expenses incurred
by City, including but not limited to salaries of personnel, in connection with
the recapture, management and resale of the Property or part thereof (but
less any income derived by City from the Property or part thereof in
connection with such management); any payments made or necessary to be
made to discharge any encumbrances or liens (except for mortgage(s)
previously acquiesced in by the City) existing on the Property or part thereof
at the time of revesting of title thereto in City or to discharge or prevent from
attaching or bring made any subsequent encumbrances or liens due to
obligations, default or acts of Developer, its successors or transferees
(except with respect to such mortgage(s)), any expenditures made or
obligations incurred with respect to the making or completion of the Minimum
Improvements or any part thereof on the Property or part thereof, and any
amounts otherwise owing to City (including water and sewer charges) by
Developer and its successors or transferees; and
(4) Fourth, to reimburse Developer up to the amount equal to (1) the sum
of the Purchase Price paid to City for the Property and the cash actually
invested by such party in making any of the Minimum Improvements on the
Property, less (2) any gains or income withdrawn or made by Developer from
this Agreement or the Property.
5.5 No Remedy Exclusive. No remedy herein conferred upon or reserved to City
is intended to be exclusive of any other available remedy or remedies, but each and
every such remedy shall be cumulative and shall be in addition to every other
remedy given under this Agreement or now or hereafter existing at law or in equity
or by statute. No delay or omission to exercise any right or power accruing upon .
any default shall impair any such right or power or shall be construed to be a waiver
thereof, but any such right and power may be exercised from time to time and as
often as may be deemed expedient.
5.6 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.
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5.7 Aqreement to Pay Attornevs' Fees and Expenses. If any action at law or in
equity, including an action for declaratory relief or arbitration, is brought to enforce
or interpret the provisions of this Agreement, the prevailing party shall be entitled to
recover reasonable attorneys' fees and costs of litigation from the other party. Such
fees and costs of litigation may be set by the court in the trial of such action or by
the arbitrator, as the case may be, or may be enforced in a separate action brought
for that purpose. Such fees and costs of litigation shall be in addition to any other
relief that may be awarded.
5.8 Remedies on Default bv City. If City defaults in the performance of this
Agreement, Developer may take any action, including legal, equitable or
administrative action that may appear necessary or desirable to collect any
payments due under this Agreement, to recover expenses of Developer, or to
enforce performance and observance of any obligation, agreement, or covenant of
City under this Agreement. Developer may suspend their performance under this
Agreement until they receive assurances from City, deemed adequate by
Developer, that City will cure its default and continue its performance under this
Agreement.
SECTION 6. GENERAL TERMS AND PROVISIONS
6.1 Notices and Demands. Whenever this Agreement requires or permits any
notice or written request by one party to another, it shall be deemed to have been
properly given if and when delivered in person or three (3) business days after
having been deposited in any U.S. Postal Service and sent by registered or certified
mail, postage prepaid, addressed as follows:
(1) If to Developer:
Heller Family Realty Company, LLC
Attn: Richard J. Heller
2131 Concord Court
Dubuque, Iowa 52003
Phone: (563) 582-7068
(2) If to City:
City Manager
50 W. 13th Street
Dubuque, Iowa 52001
Phone: (563) 589-4110
Fax: (563) 589-4149
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.
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6.2 Bindinq Effect. This Agreement shall be binding upon and shall inure to the
benefit of City and Developer and their respective successors and assigns.
6.3 Termination Date. This Agreement and the rights and obligations of the
parties hereunder shall terminate on May 1,2017 (lithe Termination Date").
6.4. Execution Bv Facsimile. The parties agree that this Agreement may be
transmitted between them by facsimile machine. The parties intend that the faxed
signatures constitute original signatures and that a faxed Agreement containing the
signatures (original or faxed) of all the parties is binding on the parties.
IN WITNESS WHEREOF, City has caused this Agreement to be duly
executed in its name and behalf by its Mayor and attested to by its City Clerk and
Developer has caused this Agreement to be duly executed on or as of the first
above written.
CITY OF DUBUQUE, IOWA
HELLER FAMILY REALTY
COMPANY, LLC
By:
Terrance M. Duggan, Mayor
By:
Richard J. Heller, Member
By:
Jeanne F. Schneider, City Clerk
F :\U S ERS\Pmyhre\WPDOCS\LOAN DOC\ Tri-States\Dev Ag ree061305. doc
20
.
'"
RESOLUTION NO. 282-05
RESOLUTION OF INTENT TO DISPOSE OF AN INTEREST IN REAL
PROPERTY IN THE DUBUQUE INDUSTRIAL CENTER WEST BY SALE TO
THE HELLER FAMILY REALTY COMPANY, LLC PURSUANT TO A
DEVELOPMENTAGREEMEN~
WHEREAS, the City of Dubuque, Iowa (City) is the owner of the following real
property (the Property), as shown on the Exhibit attached hereto consisting of 5.57
acres, more or less, the legal description of which is
Lot 3 of Dubuque Industrial Center West 3rd Addition; and
WHEREAS, City and the Heller Family Realty Company, LLC (Company) have
entered into a Development Agreement, subject to the approval of the City Council, a
copy of which is on file at the Office of the City Clerk, City Hall, 50 W. 13th Street,
Dubuque, Iowa pursuant to which City will sell the Property to Company; and
WHEREAS, the City Council has tentatively determined that it would be in the
best interests of City to approve the Development Agreement, including conveyance of
the Property to Company.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA:
Section 1. The City of Dubuque intends to dispose of its interest in the foregoing-
described Property to the Heller Family Realty Company, LLC.
Section 2. The City Clerk is hereby authorized and directed to cause this
Resolution and a notice to be published as prescribed by Iowa Code Section 364.7 of a
public hearing on City's intent to dispose of the foregoing-described Property, to be held
on the 5th day of July, 2005, at 6:30 p.m. at the Carnegie-Stout Public Library
Auditorium, 360 W. 11th Street, Dubuque, Iowa.
Passed, approved and adopted this 20th day of June, 2005.
ATTEST:
Jeanne F. Schneider
City Clerk
F :\USERS\Pmyhre\WPDOCS\LOANDOC\Tri-States\d isposeres.rtf
DEVELOPMENT AGREEMENT
AGREEMENT, made on or as of the _ day of , 2005
("Effective Date"), by and between the City of Dubuque, Iowa, a municipality
("City"), established pursuant to the Iowa Code and acting under authorization of
Iowa Code Chapter 403, as amended ("Urban Renewal Act"), and Heller Family
Realty Company, LLC, an Iowa limited liability company with its principal place of
business at Dubuque, Iowa ("Developer").
WITNESSETH:
WHEREAS, in furtherance of the objectives of the Urban Renewal Act, City
has undertaken an Urban Renewal project ("the Project") to advance the
community's ongoing economic development efforts; and
WHEREAS, the Project is located within the Dubuque Industrial Center
Economic Development District ("the 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 for the Dubuque Industrial Center Economic Development
District, approved by City Council of City on May 2, 1988, and as subsequently
amended through and including the date hereof, (as amended, attached hereto as
Exhibit A)("the Urban Renewal Plan"); and
WHEREAS, a copy of the Urban Renewal Plan, as constituted on the date of
this Agreement and in the form attached hereto, has been recorded among the land
records in the office of the Recorder of Dubuque County, Iowa; and
WHEREAS, Developer has determined that it requires new manufacturing
space to maintain and expand its operations and employment in the Project Area;
and
WHEREAS, Developer has requested that City sell to Developer
approximately five (5) acres, more or less, legally described as Lot 2 Dubuque
Industrial Center West 3rd Addition identified on Exhibit B, attached, in the City of
Dubuque, Dubuque County, Iowa, together with all easements, tenements,
hereditaments, and appurtenances belonging thereto ("the Property"), so that
Developer may develop the Property, located in the Project Area, for the
construction, use and occupancy of an industrial manufacturing building with
appurtenant uses which the City has determined and represented to Developer is in
accordance with the uses specified in the Urban Renewal Plan and in accordance
with this Agreement; and
WHEREAS, City believes that the development of the Property pursuant to
this Agreement, and the fulfillment generally of this Agreement, are in the vital and
best interests of City and in accord with the public purposes and provisions of the
applicable federal, state and local laws and the requirements under which the
Project has been undertaken and is being assisted.
NOW THEREFORE, in consideration of the premises and the mutual
obligations of the parties hereto, each of them does hereby covenant and agree
with the other as follows:
SECTION 1. CONVEYANCE OF PROPERTY TO DEVELOPER
1.1 Purchase Price. The purchase price for the Property ("the Purchase Price")
shall be the sum of Seventy-Eight Thousand Dollars ($78,000.00) per acre, which
shall be due and payable by Developer in immediately available funds in favor of
City, on or before August 1, 2005, or on such other date as the parties may
mutually agree ("the Closing Date").
1.2 Title to Be Delivered. City agrees to convey good and marketable fee simple
title in the Property to Developer subject only to easements, restrictions, conditions
and covenants of record as of the date hereof to the extent not objected to by
Developer as set forth in this Agreement, and to the conditions subsequent set forth
in Section 5.3, below:
(1) City, at its sole cost and expense, shall deliver to Developer an
abstract of title to the Property continued through the date of this Agreement
reflecting merchantable title in City in conformity with this Agreement and
applicable state law. The abstract shall be delivered together with full copies
of any and all encumbrances and matters of record applicable to the
Property, and such abstract shall become the property of Developer when
the Purchase Price is paid in full in the manner as aforesaid.
(2) Developer shall have until time of the Closing Date to render
objections to title, including any easements or other encumbrances not
satisfactory to Developer, in writing to City. Developer agrees, however, to
review the Abstract promptly following Developer's receipt of Developer's
land survey and the Abstract and to promptly provide City with any objections
to title identified therein. Nothing herein shall be deemed to limit Developer's
rights to raise new title objections with respect to matters revealed in any
subsequent title examinations and surveys and which were not identified in
the Abstract provided by the City. City shall promptly exercise its best efforts
to have such title objections removed or satisfied and shall advise Developer
of intended action within ten (10) days of such action. If City shall fail to
have such objections removed as of the Closing Date, or any extension
thereof consented to by Developer, Developer may, at its sole discretion,
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either (a) terminate this Agreement without any liability on its part, and any
sums previously paid to City by Developer (or paid into escrow for City's
benefit) shall be returned to Developer with interest, or (b) take title subject
to such objections. City agrees to use its best reasonable efforts to promptly
satisfy any such objections.
1.3 Riqhts of Inspection. Testinq and Review. Developer, its counsel,
accountants, agents and other representatives, shall have full and continuing
access to the Property and all parts thereof, upon reasonable notice to City.
Developer and its agent and representatives shall also have the right to enter upon
Property at any time after the execution and delivery hereof for any purpose
whatsoever, including inspecting, surveying, engineering, test boring, performance
of environmental tests, provided that Developer shall hold City harmless and fully
indemnify City against any damage, claim, liability or cause of action arising from or
caused by the actions of Developer, its agents, or representatives upon the
Property (except for any damage, claim, liability or cause of action arising from
conditions existing prior to any such entry upon the Property), and shall have the
further right to make such inquiries of governmental agencies and utility companies,
etc. and to make such feasibility studies and analyses as it considers appropriate.
1.4 Representations and Warranties of City. In order to induce Developer to
enter into this Agreement and purchase the Property, City hereby represents and
warrants to Developer that to the best of City's knowledge:
(1) There is no action, suit or proceeding pending, or to the best of City's
knowledge, threatened against City which might result in any adverse
change in the Property being conveyed or the possession, use or enjoyment
thereof by Developer, including, but not limited to, any action in
condemnation, eminent domain or public taking.
(2) No ordinance or hearing is now or before any local governmental
body that either contemplates or authorizes any public improvements or
special tax levies, the cost of which may be assessed against the Property.
To the best of City's knowledge, there are no plans or efforts by any
government agency to widen, modify, or re-align any street or highway
providing access to the Property and there are no pending or intended public
improvements or special assessments affecting the Property which will result
in any charge or lien be levied or assessed against the Property.
(3) All leases, contracts, licenses, and permits between City and third
parties in connection with the maintenance, use, and operation of the
Property have been provided to Developer and City has provided true and
correct copies of all such documents to Developer.
(4) City has good and marketable fee simple title interest to the Property.
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(5) The Property has a permanent right of ingress or egress to a public
roadway for the use and enjoyment of the Property.
(6) There are no notices, orders, suits, judgments or other proceedings
relating to fire, building, zoning, air pollution, health violations or other
matters that have not been corrected. City has notified Developer in writing
of any past notices, orders, suits, judgments or other proceedings relating to
fire, building, zoning, air pollution or health violations as they relate to the
Property of which it has actual notice. The Property is in material
compliance with all applicable zoning, fire, building, and health statutes,
ordinances, and regulations.
(7) Payment has been made for all labor or materials that have been
furnished to the Property or will be made prior to the Closing Date so that no
lien for labor performed or materials furnished can be asserted against the
Property.
(8) The Property will as of the Closing Date be free and clear of all liens,
security interests, and encumbrances.
(9) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated by this Agreement do not
and shall not result in any material breach of any terms or conditions of any
mortgage, bond, indenture, agreement, contract, license, or other instrument
or obligation to which City is a party or by which either the City or the
Property being conveyed are bound, nor shall the execution, delivery and
performance of this Agreement violate any statute, regulation, judgment, writ,
injunction or decree of any court threatened or entered in a proceeding or
action in which City may be bound or to which either City or the Property
being conveyed may be subject.
(10) City has duly obtained all necessary approvals and consents for its
execution, delivery and performance of this Agreement, and that it has full
power and authority to execute, deliver and perform its obligations under this
Agreement. City's attorney shall issue a legal opinion to Developer at time of
closing confirming the representation contained herein, in form and
substance reasonably satisfactory to Developer.
(11) City water and storm sewer necessary for the development and use of
the Property as an industrial manufacturing facility shall be available to
Developer by November 15, 2005, and Developer shall have the right to tie
into said utilities.
4
(12) The Property is free and clear of any occupants, and no party has a
lease to or other occupancy or contract right in the Property that shall in
anyway be binding upon the Property or Developer.
(13) City represents and warrants that any fees or other compensation
which may be owed to a broker engaged directly or indirectly by City in
connection with the purchase and sale contemplated in this Agreement are
the sole responsibility and obligation of City and that City will indemnify
Developer and hold Developer harmless from any and all claims asserted by
any broker engaged directly or indirectly by City for any fees or other
compensation related to the subject matter of this Agreement.
(14) City shall exercise its best efforts to cooperate with Developer in the
development process.
(15) City shall exercise its best efforts to resolve any disputes arising
during the development process in a reasonable and prompt fashion.
(16) With respect to the period during which City has owned or occupied
the Property, and to City's knowledge after reasonable investigation with
respect to the time before City owned or occupied the Property, no person or
entity has caused or permitted materials to be stored, deposited, treated,
recycled, or disposed of on, under or at the Property, which materials, if
known to be present, would require cleanup, removal or some other remedial
action under environmental laws.
(17) The representations and warranties contained in this article shall be
correct in all respects on and as of the Closing Date with the same force and
effect as if such representations and warranties had been made on and as of
the Closing Date.
1.5 Conditions to Closinq. The closing of the transaction contemplated by this
Agreement and all the obligations of Developer 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 1.4 shall
be correct as of the Closing Date with the same force and effect as if such
representations were made at such time. At the closing, City shall deliver a
certificate to that effect.
(2) Title to the Property shall be in the condition warranted in Section 1.4.
(3) Developer, in its sole and absolute discretion, having completed and
approved of any inspections done by Developer hereunder.
5
(4) Developer having obtained any and all necessary governmental
approvals, including without limitations approval of zoning, subdivision or
platting which might be necessary or desirable in connection with the sale
and transfer and development of the Property. Any conditions imposed as a
part of the zoning, platting or subdivision must be satisfactory to Developer,
in its sole opinion. City shall cooperate with Developer in attempting to
obtain any such approvals and shall execute any documents necessary for
this purpose, provided that City shall bear no expense in connection
therewith. In connection therewith, the City agrees (a) to review all of
Developer's plans and specifications for the project and to either reject or
approve the same in a prompt and timely fashion; (b) to issue a written
notification to Developer, following City's approval of same, indicating that
the City has approved such plans and specifications, and that the same are
in compliance with the Urban Renewal Plan, this Agreement and any other
applicable City or affiliated agency requirements, with the understanding that
Developer and its lenders shall have the right to rely upon the same in
proceeding with the project; (c) to identify in writing within ten (10) working
days of submission of said plans and specifications, any and all permits,
approvals and consents that are legally required for the acquisition of the
Property by Developer, and the construction, use and occupancy of the
project with the intent and understanding that Developer and its lenders and
attorneys will rely upon same in establishing their agreement and time
frames for construction, use and occupancy, lending on the project and
issuing legal opinions in connection therewith; and (d) to cooperate fully with
Developer to streamline and facilitate the obtaining of such permits,
approvals and consents.
(5) City having completed all required notice to or prior approval, consent
or permission of any federal, state or municipal or local governmental
agency, body, board or official to the sale of the Property; and
consummation of the closing by City shall be deemed a representation and
warranty that it has obtained the same.
(6) Developer and City shall be in material compliance with all the terms
and provisions of this Agreement.
(7) Developer shall have furnished City with evidence, in a form
satisfactory to City (such as a letter of commitment from a bank or other
lending institution), that Developer has firm financial commitments in an
amount sufficient, together with equity commitments, to complete the
Minimum Improvements (as defined herein) in conformance with the
Construction Plans (as defined herein), or City shall have received such
other evidence of such party's financial ability as in the reasonable judgment
of City is required.
6
(8) Receipt of an opinion of counsel to Developer in the form attached
hereto as Exhibit C.
(9) Developer shall have the right to terminate this Agreement at anytime
prior to the consummation of the closing on the Closing Date if Developer
determines in its sole discretion that conditions necessary for the successful
completion of the Project contemplated herein have not been satisfied to the
full satisfaction of such party in such party's sole and unfettered discretion.
Upon the giving of notice of termination by such terminating party to the
other parties to this Agreement, this Agreement shall be deemed null and
void.
1.6 Closinq. The closing ofthe purchase and sale shall take place on the
Closing Date. Exclusive possession of the Property shall be delivered on the
Closing Date, in its current condition and in compliance with this Agreement,
including City's representations and warranties regarding the same. Consummation
of the closing shall be deemed an agreement of the parties to this Agreement that
the conditions of closing shall have been satisfied or waived.
1.7 City's Obligations at Closinq. At or prior to the Closing Date, City shall:
(1) Deliver to Developer City's duly recordable Special Warranty Deed to
the Property (in the form attached hereto as Exhibit 0 ("Deed") conveying to
Developer marketable fee simple title to the Property and all rights
appurtenant thereto, subject only to easements, restrictions, conditions and
covenants of record as of the date hereof and not objected to by Developer
as set forth in this Agreement, and to the conditions subsequent set forth in
Section 5.3 below.
(2) Deliver to Developer the Abstract of Title to the Property.
(3) Deliver to Developer such other documents as may be required by
this Agreement, all in a form satisfactory to Developer.
1.8 Delivery of Purchase Price; Obliqations At Closinq. At closing, and subject
to the terms, conditions, and provisions hereof and the performance by City of its
obligations as set forth herein, Developer shall pay the Purchase Price to City
pursuant to Section 1.1 hereof, but subject to Developer receiving an offsetting
credit pursuant to Section 3.1 below.
1.9 Closinq Costs. The following costs and expenses shall be paid in connection
with the closing:
(1) City shall pay:
7
(a)
(b)
1.10.
(c)
assessed.
(d)
(e)
The transfer fee, if any, imposed on the conveyance.
A pro-rata portion of all taxes, if any, as provided in Section
All special assessments, if any, whether levied, pending or
City's attorney's fees, if any.
City's broker and/or real estate commissions and fees, if any.
(f) The cost of recording the satisfaction of any existing mortgage
and any other document necessary to make title marketable.
(2) Developer shall pay the following costs in connection with the closing:
(a) The recording fee necessary to record the Deed.
(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 1.10.
1.10 Real Estate Taxes. City shall pay all real estate taxes for all fiscal years that
end prior to the Closing Date. Real estate taxes for the fiscal year in which the
Closing Date occurs shall be prorated between City and Developer to the Closing
Date on the basis of a 365-day calendar year. Developer shall payor cause to be
paid all real estate taxes due in subsequent fiscal years. Any proration of real
estate taxes on the Property shall be based upon such taxes for the year currently
payable.
SECTION 2. DEVELOPMENT ACTIVITIES
2.1 ReQuired Minimum Improvements. City acknowledges that Developer is
building an industrial manufacturing facility on the Property. Specifically, Developer
is charged with constructing the building and certain internal systems thereto, and
with finishing the building including, without limitation, all interior improvements ("the
Minimum Improvements"); all as more particularly depicted and described on the
plans and specifications to be delivered to and approved by City as contemplated in
this Agreement. Developer hereby agrees to construct on the Property an industrial
manufacturing facility of not less than fifty thousand (50,000) square feet of floor
8
space along with necessary sitework as contemplated in this Agreement at a cost of
not less than $1,400,000.00.
2.2 Plans for Construction of Minimum Improvements. Plans and specifications
with respect to the development of Property and the construction of Minimum
Improvements thereon (lithe Construction Plans") shall be in conformity with Urban
Renewal Plan, this Agreement, and all applicable state and local laws and
regulations, including but not limited to the Amended and Restated Declaration of
Covenants, Conditions, Restrictions, Reservations, Easements, Liens and Charges,
recorded as Instrument No. 7990-02, records of Dubuque County, Iowa. Developer
shall submit to City, for approval by City, plans, drawings, specifications, and
related documents with respect to the 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.
2.3 TiminQ of Improvements. Developer hereby agrees that construction of
Minimum Improvements on the Property shall be commenced within three (3)
months after the Closing Date, and shall be substantially completed by March 31,
2006. The time frames for the performance of these obligations shall be
suspended due to unavoidable delays meaning delays, outside the control of the
party claiming its occurrence in good faith, which are the direct result of strikes,
other labor troubles, unusual shortages of materials or labor, unusually severe or
prolonged bad weather, acts of God, fire or other casualty to the Minimum
Improvements, litigation commenced by third parties which, by injunction or other
similar judicial action or by the exercise of reasonable discretion directly results in
delays, or acts of any federal, state or local government which directly result in
extraordinary delays. The time for performance of such obligations shall be
extended only for the period of such delay.
2.4 Certificate of Completion. Promptly following the request of Developer upon
completion of the Minimum Improvements, City shall furnish Developer with an
appropriate instrument so certifying. Such certification (lithe Certificate of
Completion") shall be in recordable form and shall be a conclusive determination of
the satisfaction and termination of the agreements and covenants in this
Agreement and in the Deed with respect to the obligations of Developer to
construct Minimum Improvements. The Certificate of Completion shall waive all
rights of re-vestment of title in City as provided in Section 5.3, and the Certificate of
Completion shall so state.
2.5 Developer's Lender's Cure RiQhts. The parties agree that if Developer shall
fail to complete the Minimum Improvements as required by this Agreement such
that re-vestment of title may occur (or such that the City would have the option of
exercising its re-vestment rights), then Developer's lender shall have the right, but
not the obligation, to complete such Minimum Improvements.
9
SECTION 3. CITY PARTICIPATION
3.1 Acquisition Grant to Developer. For and in consideration of Developer's
obligations hereunder to construct the Minimum Improvements, City agrees to
make an Acquisition Grant to Developer on the Closing Date, or such other date as
the parties shall mutually agree upon in writing, in the full amount of the Purchase
Price. The parties agree that the Acquisition Grant shall be payable in the form of a
credit favoring Developer at time of closing with the effect of directly offsetting the
full purchase price obligation of Developer.
3.2 Economic Development Grant to Developer.
(1) For and in consideration of Developer's obligations hereunder, and in
furtherance of the goals and objectives of the urban renewal plan for the
Project Area and the Urban Renewal Law, City agrees, subject to Developer
being and remaining in compliance with the terms of this Agreement, to
make twenty (20) consecutive semi-annual payments (such payments being
referred to collectively as "the Economic Development Grants") to the
Developer, commencing November 1, 2007, and continuing until May 1,
2017, pursuant to Iowa Code Section 403.9 of the Urban Renewal Law, in
amounts equal to the actual amount of tax increment revenues paid by
Developer and collected by City under Iowa Code Section 403.19 (without
regard to any averaging that may otherwise be utilized under Iowa Code
Section 403.19 and excluding any interest that may accrue thereon prior to
payment to Developer) during the preceding six-month period in respect of
the Minimum Improvements constructed by Developer ("the Developer Tax
Increments").
(2) To fund the Economic Development Grants, City shall certify to the
County prior to December 1 of each year, commencing December 1, 2005,
its request for the available Developer Tax Increments resulting from the
assessments imposed by the County as of January 1 of the following year, to
be collected by City as taxes are paid during the following fiscal year and
which shall thereafter be disbursed to the Developer on November 1 and
May 1 of that fiscal year. (Example: if City so certifies by December, 2005,
the Economic Development Grants in respect thereof would be paid to the
Developer on November 1,2007, and May 1,2008.)
(3) The Economic Development Grants shall be payable from and
secured solely and only by the Developer Tax Increments paid to City that,
upon receipt, shall be deposited and held in a special account created for
such purpose and designated as the "Heller Family Realty Company TIF
Account" of City. City hereby covenants and agrees to maintain its TIF
ordinance in force during the term hereof and to apply the incremental taxes
collected in respect of the Minimum Improvements and allocated to the
10
Heller Family Realty Company TIF Account to pay the Economic
Development Grants, as and to the extent set forth in Section 3.2(1) hereof.
The Economic Development Grants shall not be payable in any manner by
other tax increments revenues or by general taxation or from any other City
funds. City makes no representation with respect to the amounts that may
be paid to Developer as the Economic Development Grants in anyone year
and under no circumstances shall City in any manner be liable to Developer
so long as City timely applies the Developer Tax Increments actually
collected and held in the Heller Family Realty Company TIF Account
(regardless of the amounts thereof) to the payment of the Economic
Development Grants to Developer as and to the extent described in this
Section.
(4) City shall be free to use any and all tax increment revenues collected
in respect of other properties within the Project Area, or any available
Developer Tax Increments resulting from the termination of the annual
Economic Development Grants under Section 3.2 hereof, for any purpose for
which such tax increment revenues may lawfully be used pursuant to the
provisions of the Urban Renewal Law, and City shall have no obligations to
Developer with respect to the use thereof.
3.3 Site GradinQ Participation. City shall reimburse Developer for all of certain
costs to be incurred by Developer associated with diverting drainage from the
adjacent lot directly east of the Property. City shall approve the design and
specifications and costs Developer is to be reimbursed for such work by the Closing
Date ..
3.4 Construction of Cul-De-Sac Street. City, at its expense, shall complete
construction of the cul-de-sac street from Chavenelle Road to serve the Property, at
no cost to Developer, by special assessment or otherwise.
SECTION 4. COVENANTS OF DEVELOPER
4.1 Job Creation. During the term of this Agreement, Developer shall make best
efforts to maintain its existing seventeen (17) employees in Dubuque, Iowa.
4.2 Books and Records. During the term of this Agreement, Developer shall
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 Developer in accordance with generally accepted accounting
principles consistently applied throughout the period involved, and Developer shall
provide reasonable protection against loss or damage to such books of record and
account.
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4.3 Real Property Taxes. From and after the Closing Date, Developer shall pay
or cause to be paid, when due, all real property taxes and assessments payable
with respect to all and any parts of the Property unless Developer's obligations have
been assumed by another person pursuant to the provisions of this Agreement.
4.4 No Other Exemptions. During the term of this Agreement, the Developer
agrees not to apply for any other state or local property tax exemptions which are
available with respect to the Development Property or the Minimum Improvements
located thereon that may now be, or hereafter become, available under state law or
city ordinance during the term of this Agreement, including those that arise under
Iowa Code Chapters 404 and 427, as amended.
4.5 Insurance Requirements. During the term of this Agreement,
(1) Developer shall provide and maintain or cause to be maintained at all
times during the process of constructing the Minimum Improvements (and,
from time to time at the request of City, furnish City with proof of insurance in
the form of a certificate of insurance for each insurance policy):
(a) All risk builder's risk insurance, written on a Completed Value
Form in an amount equal to one hundred percent (100%) of the
replacement value when construction is completed;
(b) Insurance as set forth in the attached Insurance Schedule.
(2) Upon completion of construction of the Minimum Improvements and
up to the Termination Date, Developer shall maintain, or cause to be
maintained, at its cost and expense (and from time to time at the request of
City shall furnish proof of insurance in the form of a certificate of insurance)
insurance as follows:
(a) All risk property insurance against loss and/or damage to
Minimum Improvements under an insurance policy written in an
amount not less than the full insurable replacement value of Minimum
Improvements. The term "replacement value" shall mean the actual
replacement cost of the Minimum Improvements (excluding
foundation and excavation costs and costs of underground flues,
pipes, drains and other uninsurable items) and equipment, and shall
be reasonably determined from time to time at the request of City, but
not more frequently than once every three (3) years.
(b) Insurance as set forth in the attached Insurance Schedule.
(3) Developer agrees to notify City immediately in the case of damage
exceeding $50,000.00 in amount to, or destruction of, the Minimum
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Improvements or any portion thereof resulting from fire or other casualty.
The net proceeds of any such insurance ("the Net Proceeds"), shall be paid
directly to Developer as its interests may appear.
4.6 Preservation of Property. During the term of this Agreement, Developer shall
maintain, preserve and keep, or cause others to maintain, preserve and keep, the
Minimum Improvements in good repair and working order, ordinary wear and tear
accepted, and from time to time shall make all necessary repairs, replacements,
renewals and additions. Nothing in this Agreement, however, shall be deemed to
alter any agreements between Developer or any other party including, without
limitation, any agreements between the parties regarding the care and maintenance
of the Property.
4.7 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.
4.8 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. In connection with this
obligation, Developer shall have the right to rely upon the representations of any
party with whom it does business and shall not be obligated to perform any further
examination into such party's background.
4.9 Non-Transferabilitv. Until such time as the Minimum Improvements are
complete (as certified by City under Section 2.4), this Agreement may not be
assigned by Developer nor may the Property be transferred by Developer to
another party without the prior written consent of City, which shall not be
unreasonably withheld. Thereafter, Developer shall have the right to assign this
Agreement and upon assumption of the Agreement by the assignee, Developer
shall no longer be responsible for its obligations under this Agreement.
4.10 Restrictions on Use. Developer agrees for itself, and its successors and
assigns, and every successor in interest to the Property or any part thereof that
they, and their respective successors and assigns, shall:
(1) Devote the Property to, and only to and in accordance with, the uses
specified in the Urban Renewal Plan (and City represents and agrees that
use of the Property as an industrial manufacturing center is in full
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compliance with the Urban Renewal Plan) (however, Developer shall not
have any liability to City to the extent that a successor in interest shall breach
this covenant and City shall seek enforcement of this covenant directly
against the party in breach of same); and
(2) Not discriminate upon the basis of race, religion, color, sex, national
origin, age or disability in the sale, lease, rental, use or occupancy of the
Property or any improvements erected or to be erected thereon, or any part
thereof (however, Developer shall not have any liability to City to the extent
that a successor in interest shall breach this covenant and City shall seek
enforcement of this covenant directly against the party in breach of same).
4.11 Release and Indemnification Covenants.
(1) Developer releases City and the governing body members, officers,
agents, servants and employees thereof (hereinafter, for purposes of this
Section, the "Indemnified Parties") from, covenants and agrees that the
Indemnified Parties shall not be liable for, and 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 the Minimum Improvements.
(2) Except for any gross negligence, willful misrepresentation or any
willful or wanton misconduct or any unlawful act of the Indemnified Parties,
Developer 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 (1) any
violation of any agreement or condition of this Agreement (except with
respect to any suit, action, demand or other proceeding brought by
Developer against City based on an alleged breach of any representation,
warranty or covenant of City under this Agreement and/or to enforce its
rights under this Agreement) or (2) the acquisition, construction, installation,
ownership, and operation of the Minimum Improvements or (3) the condition
of the Property and any hazardous substance or environmental
contamination located in or on the Property, occurring after Developer takes
possession of the Property.
(3) The Indemnified Parties shall not be liable to Developer for any
damage or injury to the persons or property of Developer or its officers,
agents, servants or employees or any other person who may be on, in or
about the Minimum Improvements due to any act of negligence of any
person, other than any act of negligence on the part of any such Indemnified
Party or its officers, agents, servants or employees.
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(4) All covenants, stipulations, promises, agreements and obligations of
City contained herein shall be deemed to be the covenants, stipulations,
promises, agreements and obligations of City, and not of any governing body
member, officer, agent, servant or employee of City in the individual capacity
thereof.
(5) The provisions of this Section shall survive the termination of this
Agreement.
4.12 Compliance with Laws. Developer shall comply with all laws, rules and
regulations relating to its businesses, other than laws, rules and regulations the
failure to comply with which or the sanctions and penalties resulting therefrom,
would not have a material adverse effect on the business, property, operations,
financial or otherwise, of Developer.
4.13 City's First Riqht to Purchase: Developer's First Riqht to Re-Purchase.
Developer agrees to complete and sign an Affidavit, attached hereto as Exhibit E,
provided by the Iowa Department of Transportation that relinquishes all rights as
given by Iowa Code Section 306.23 to property located at 10 South Main Street,
Dubuque, Iowa, legally described as:
Lots 1,2,3,4,5,6,7,8, and 9 (except the Easterly 20 feet of said
lots), in the Subdivision of the Westerly half of Block 14, and Lot A of
Block 14, and Lot 1 of Lot B of Block 19, in Dubuque Harbor Co.'s
Addition, in the City of Dubuque, Iowa, according to the recorded
Plats of said respective Subdivision; together with all easement rights
acquired by Sellers in a document recorded as No. 51532 on October
19,1951, in the Recorder's Office in Dubuque County, Iowa,
(hereafter the "South Main Street Property") and grant such rights exclusively to
City.
SECTION 5. EVENTS OF DEFAULT AND REMEDIES
5.1 Events of Default Defined. The following shall be "Events of Default" under
this Agreement and the term "Event of Default" shall mean, whenever it is used in
this Agreement, anyone or more of the following events:
(1) Failure by Developer to payor cause to be paid, before delinquency,
all real property taxes assessed with respect to the Minimum Improvements
and the Property.
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(2) Failure by Developer to cause the construction of the Minimum
Improvements to be commenced and completed pursuant to the terms,
conditions and limitations of this Agreement.
(3) Transfer of any interest by Developer of the Minimum Improvements
in violation of the provisions of this Agreement prior to the issuance of the
final Certificate of Completion.
(4) Failure by Developer or City to substantially observe or perform any
other material covenant, condition, obligation or agreement on its part to be
observed or performed under this Agreement.
5.2. Remedies on Default bv Developer. Whenever any Event of Default referred
to in Section 5.1 of this Agreement occurs and is continuing, City, as specified
below, may take anyone or more of the following actions after the giving of written
notice by City to Developer (and the holder of any mortgage encumbering any
interest in the Property of which City has been notified of in writing) of the Event of
Default, but only if the Event of Default has not been cured within sixty (60) days
following such notice, or if the Event of Default cannot be cured within sixty (60)
days and Developer does not provide assurances to City that the Event of Default
will be cured as soon as reasonably possible thereafter:
(1) City may suspend its performance under this Agreement until it
receives assurances from the defaulting party deemed adequate by City, that
the defaulting party will cure its default and continue its performance under
this Agreement;
(2) Until the Closing Date, City may cancel and rescind this Agreement;
(3) City shall be entitled to recover from Developer the sum of all
amounts expended by City in connection with the funding of the Acquisition
Grant to Developer, and City may take any action, including any legal action
it deems necessary, to recover such amounts from the defaulting party;
(4) City may withhold the Certificate of Completion; or
(5) City may take any action, including legal, equitable or administrative
action, which may appear necessary or desirable to collect any payments
due under this Agreement or to enforce performance and observance of any
obligation, agreement, or covenant under this Agreement.
5.3 Re-Vestina Title in City Upon Happenina of Event Subsequent to
Conveyance to Developer. In the event that subsequent to conveyance of the
Property to Developer by City and prior to receipt by Developer of the Certificate of
Completion, but subject to the terms of the mortgage granted by Developer to
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secure a loan obtained by Developer from a commercial lender or other financial
institution to fund the acquisition of Property or construction of the Minimum
Improvements, ("First Mortgage") an Event of Default under Section 5.1 of this
Agreement occurs and is not cured within the times specified in Section 5.2, then
City shall have the right to re-enter and take possession of the Property and any
portion of the Minimum Improvements thereon and to terminate (and re-vest in City
pursuant to the provisions of this Section 5.3 subject only to any superior rights in
any holder of the First Mortgage) the estate conveyed by City to Developer, it being
the intent of this provision, together with other provisions of this Agreement, that the
conveyance of the Property to Developer shall be made upon the condition that
(and the Deed shall contain a condition subsequent to the effect that), in the event
of default under Section 5.1 on the part of Developer and failure on the part of
Developer to cure such default within the period and in the manner stated herein,
City may declare a termination in favor of City of the title and of all Developer's
rights and interests in and to Property conveyed to Developer, and that such title
and all rights and interests of Developer, and any assigns or successors in interests
of Developer, and any assigns or successors in interest to and in Property, shall
revert to City (subject to the provisions of Section 5.3 of this Agreement), but only if
the events stated in Section 5.1 of this Agreement have not been cured within the
time period provided above, or, if the events cannot be cured within such time
periods, Developer does not provide assurance to City, reasonably satisfactory to
City, that the events will be cured as soon as reasonably possible. Notwithstanding
the foregoing, however, City agrees to execute a Subordination Agreement in favor
of Developer's first mortgage lender, in a form reasonably acceptable to City and to
Developer's first mortgage lender.
5.4 Resale of Reacquired Property; Disposition of Proceeds. Upon the re-
vesting in City of title to the Property as provided in Section 5.3 of this Agreement,
City shall, pursuant to its responsibility under law, use its best efforts, subject to any
rights or interests in such property or resale granted to any holder of a First
Mortgage, to resell the Property or part thereof as soon and in such manner as City
shall find feasible and consistent with the objectives of such law and of the Urban
Renewal Plan to a qualified and responsible party or parties (as determined by City
in its sole discretion) who will assume the obligation of making or completing the
Minimum Improvements or such other improvements in their stead as shall be
satisfactory to City and in accordance with the uses specified for such the Property
or part thereof in the Urban Renewal Plan. Subject to any rights or interests in such
property or proceeds granted to any holder of a First Mortgage upon such resale of
the Property the proceeds thereof shall be applied:
(1) First, to pay and discharge the First Mortgage;
(2) Second, to pay the principal and interest on mortgage(s) created on
the Property, or any portion thereof, or any improvements thereon,
previously acquiesced in by City pursuant to this Agreement. If more than
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one mortgage on the Property, or any portion thereof, or any improvements
thereon, has been previously acquiesced in by City pursuant to this
Agreement and insufficient proceeds of the resale exist to pay the principal
of, and interest on, each such mortgage in full, then such proceeds of the
resale as are available shall be used to pay the principal of and interest on
each such mortgage in their order of priority, or by mutual agreement of all
contending parties including Developer, or by operation of law;
(3) Third, to reimburse City for all allocable costs and expenses incurred
by City, including but not limited to salaries of personnel, in connection with
the recapture, management and resale of the Property or part thereof (but
less any income derived by City from the Property or part thereof in
connection with such management); any payments made or necessary to be
made to discharge any encumbrances or liens (except for mortgage(s)
previously acquiesced in by the City) existing on the Property or part thereof
at the time of revesting of title thereto in City or to discharge or prevent from
attaching or bring made any subsequent encumbrances or liens due to
obligations, default or acts of Developer, its successors or transferees
(except with respect to such mortgage(s)), any expenditures made or
obligations incurred with respect to the making or completion of the Minimum
Improvements or any part thereof on the Property or part thereof, and any
amounts otherwise owing to City (including water and sewer charges) by
Developer and its successors or transferees; and
(4) Fourth, to reimburse Developer up to the amount equal to (1) the sum
of the Purchase Price paid to City for the Property and the cash actually
invested by such party in making any of the Minimum Improvements on the
Property, less (2) any gains or income withdrawn or made by Developer from
this Agreement or the Property.
5.5 No Remedv Exclusive. No remedy herein conferred upon or reserved to City
is intended to be exclusive of any other available remedy or remedies, but each and
every such remedy shall be cumulative and shall be in addition to every other
remedy given under this Agreement or now or hereafter existing at law or in equity
or by statute. No delay or omission to exercise any right or power accruing upon
any default shall impair any such right or power or shall be construed to be a waiver
thereof, but any such right and power may be exercised from time to time and as
often as may be deemed expedient.
5.6 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.
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5.7 AQreement to Pay Attornevs' Fees and Expenses. If any action at law or in
equity, including an action for declaratory relief or arbitration, is brought to enforce
or interpret the provisions of this Agreement, the prevailing party shall be entitled to
recover reasonable attorneys' fees and costs of litigation from the other party. Such
fees and costs of litigation may be set by the court in the trial of such action or by
the arbitrator, as the case may be, or may be enforced in a separate action brought
for that purpose. Such fees and costs of litigation shall be in addition to any other
relief that may be awarded.
5.8 Remedies on Default bv City. If City defaults in the performance of this
Agreement, Developer may take any action, including legal, equitable or
administrative action that may appear necessary or desirable to collect any
payments due under this Agreement, to recover expenses of Developer, or to
enforce performance and observance of any obligation, agreement, or covenant of
City under this Agreement. Developer may suspend their performance under this
Agreement until they receive assurances from City, deemed adequate by
Developer, that City will cure its default and continue its performance under this
Agreement.
SECTION 6. GENERAL TERMS AND PROVISIONS
6.1 Notices and Demands. Whenever this Agreement requires or permits any
notice or written request by one party to another, it shall be deemed to have been
properly given if and when delivered in person or three (3) business days after
having been deposited in any U.S. Postal Service and sent by registered or certified
mail, postage prepaid, addressed as follows:
(1) If to Developer:
Heller Family Realty Company, LLC
Attn: Richard J. Heller
2131 Concord Court
Dubuque, Iowa 52003
Phone: (563) 582-7068
(2) If to City:
City Manager
50 W. 13th Street
Dubuque, Iowa 52001
Phone: (563) 589-4110
Fax: (563) 589-4149
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.
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. >
6.2 Bindinq Effect. This Agreement shall be binding upon and shall inure to the
benefit of City and Developer and their respective successors and assigns.
6.3 Termination Date. This Agreement and the rights and obligations of the
parties hereunder shall terminate on May 1,2017 ("the Termination Daten).
6.4. Execution By Facsimile. The parties agree that this Agreement may be
transmitted between them by facsimile machine. The parties intend that the faxed
signatures constitute original signatures and that a faxed Agreement containing the
signatures (original or faxed) of all the parties is binding on the parties.
IN WITNESS WHEREOF, City has caused this Agreement to be duly
executed in its name and behalf by its Mayor and attested to by its City Clerk and
Developer has caused this Agreement to be duly executed on or as of the first
above written.
HELLER FAMILY REALTY
COMPANY, LLC
BY:~ ~ ~W
Rich'ard J. Hell r, Member
CITY OF DUBUQUE, IOWA
'/:j~ /
ne F. Schneider, City Clerk
F :\USERS\Pmyh re\WPDOCS\LOAN DOC\ Tri-States\DevAgree061305. doc
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