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Brewery Project Development Agreement Dii~~E ~<Ik-~ MEMORANDUM July 11, 2006 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Development Agreement for the Dubuque Star Brewery Project The City Council previously selected Port of Dubuque Brewery Development, LLC, as the developer for the former Dubuque Star Brewery. Economic Development Director David Heiar is recommending execution of a Development Agreement in which the developer is agreeing to rehabilitate the Dubuque Star Brewery into a mixed-use commercial and entertainment complex, at a total project cost of not less than $6,500,000. The agreement includes: The lease term is 50 years for the building and 60,173 square foot of land. The lease price for the first y 5 years is $1.00. In years 6 through 15, the annual lease price is $62,100. In year 16, the lease price will be 10% of the appraised value of the land, with a 3% annual escalator clause through year 30. Beginning in year 31, an appraisal will be done every 5 years. The lessee will develop and maintain a 39,405 square foot parking lot that will be open to the public. Up to 50 days each year, the lessee can control access to the parking lot to ensure parking is available for building tenants when special events or other activities are being conducted in the Port of Dubuque. The estimated cost of building improvements is $6.5 million, with at least 35% of those to be completed within 2 years. The City will construct Shot Tower Drive around the north side of the building. The Company will receive a 1 O-year property tax rebate. At the end of 50 years, the lessee has an option for an additional 1 O-year lease, but at that time the lease payment will be 12% of the value of the land and the improvements. I concur with the recommendation and respectfully request Mayor and City Council approval. (l1J\ ~:t,(\lj~ Michael C. Van Milligen . MCVM/jh Attachment cc: Barry Lindahl, Corporation Counsel Cindy Steinhauser, Assistant City Manager David J. Heiar, Economic Development Director BrJi3tJ~Uii ~<k.~ MEMORANDUM July 6, 2006 TO: Michael Van Milligen, City Manager . FROM: David J. Heiar, Economic Development DirectoCDji SUBJECT: Development Agreement for the Dubuque Star Brewery Project INTRODUCTION This memorandum provides for Council consideration a development agreement and lease of the former Dubuque Star Brewery building and site. A resolution is attached to approve the development agreement and lease of this site. BACKGROUND In January 2006, the City Council selected Port of Dubuque Brewery Development, LLC as the developer for the former Dubuque Star Brewery pending the negotiations of a Development Agreement and lease. Since that time, staff has been working with the Port of Dubuque Brewery Development, LLC to develop the attached agreements. On June 5, 2006 The City Council set a public hearing on these agreements and authorized a notice soliciting competing proposals. The attached Development Agreement and lease establish the proposed terms. The key elements of these agreements include the following; 1. The term of the lease is 50 years. The lease price increases over the term. The first five years the lease is $1.00. In years 6-15, the annual lease price is $62,100. In year 16, the lease price will be 10% of the appraised value of the land; years 17-30 will be based on the appraisal with a 3% annual escalator clause. It is agreed that beginning in year 31, another land appraisal will be completed every 5 years. The lease cost will be 10% of the most recent appraisal. 2. The leased area will include the building and some of the adjacent land consisting of approximately 60,173 sq. ft. 3. The Lessee will also have a non-exclusive lease of an adjacent parking area consisting of approximately 39,405 sq. ft. in area. The Lessee will be responsible for developing and maintaining the parking area, and will be allowed to control access to the parking area up to 50 days each year to accommodate the parking requirements of the building sub-tenants. On all other days the parking lot will be available to anyone. 4. Developer estimates the building improvements will cost $6.5 million. The developer has also committed to completing the entire renovation project (excluding tinal tenant improvements) regardless of having tenants signed for the whole building. All improvements must meet the Port of Dubuque Design Standards and comply with guidelines for Historic Rehabilitation. At least 35% of the minimum improvements must be completed within two years. 5. The City will construct Bell Street Extension (Shot Tower Drive), to the north of the Brewery. 6. The Company will receive a 10 year TIF in the form of a yearly tax rebate. This is different from the original proposal submitted by the developer which requested an upfront TIF grant. 7. The City will require that, with respect to the sale of any food or beverages, including wine, for any event held in the Alliant Amphitheater by any party, that such party will be required to obtain a bid for the provision of such food from Lessee's sub-tenants located in the Dubuque Star Brewery Building. 8. Lessee will be granted on option to renew the lease for 10 additional years. The lease price would be established by an appraisal of the building and the land. Lessee would pay 12% of this appraised value annually for the entire 10 year period. Additional terms and conditions of the lease of the property are included within the attached Development Agreement and Lease documents. RECOMMENDATION I recommend that the City Council approve the development agreement and lease of the former Dubuque Star Brewery building and site to the Port of Dubuque Brewery Development, LLC. This action supports the Council's objectives to redevelop the Port of Dubuque and create new jobs. ACTION STEP The action step for the City Council is to adopt the attached Resolution. F:IUSERSIDHeiarlMemos to MVMICouncilltemslDevelopment Agreement for the Dubuque Star Brewery Project.doc Doc ID: 005800800002 Type: GEN Recorded: 10/02/2007 at 03:56:44 PM Fee Amt: $12.00 Page 1 of 2 Dubuque County Iowa Kathy Flynn Thurlow Recorder File Prepared by: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 Return to: Barry A. Lindahl 300 Main Street Suits 330 Dubuque IA 52001 563 583-4113 MEMO NUM OF DEVELOPMENT AGREEMENT AND LEASE A Development Agreement and Lease by and among the City of Dubuque, Iowa, an Iowa municipal corporation, of Dubuque, Iowa, and Port of Dubuque Brewery Development, LLC, an Iowa Limited Liability Company was made regarding the following described premises: Part of Lot 2 Riverwalk 5th Addition in the City of Dubuque, Iowa, according to the recorded plat thereof. The Development Agreement is dated for reference purposes the 17th day of July, 2006, and contains covenants, conditions, and restrictions concerning the sale and use of said premises. This Memorandum of Development Agreement and Lease is recorded for the purpose of constructive notice. In the event of any conflict between the provisions of this Memorandum and the Development Agreement or Lease, executed by the parties, the terms and provisions of the Development Agreement and Lease shall prevail. A complete counterpart of the Development Agreement and Lease, together with any amendments thereto, is in the possession of the City of Dubuque and may be examined at its offices as above provided. Dated this 28th day of September, 2007. CITY OF DUBUQUE, IOWA STATE OF IOWA :ss: DUBUQUE COUNTY On this `~ day of September, 2007, before me, a Notary Public in and for the State of Iowa, in and for said county, personally appeared Roy D. Buol and Jeanne F. Schneider, to me personally known, who being by me duly sworn did say that they are the Mayor and City Clerk, respectively of the City of Dubuque, a Municipal Corporation, created and existing under the laws of the State of Iowa, and that the seal affixed to said instrument is the seal of said Municipal Corporation and that said instrument was signed and sealed on behalf of said Municipal corporation by authority and resolution of its City Council and said Mayor and City Clerk acknowledged said instrument to be the free act and deed of said Municipal Corporation by it voluntarily executed. Natary Public, State of Iowa RESOLUTION NO. 330-06 DETERMINING THAT THE PROPOSAL OF PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC TO DEVELOP AND LEASE PROPERTY IN THE GREATER DOWNTOWN URBAN RENEWAL DISTRICT IN THE PORT OF DUBUQUE IN THE CITY OF DUBUQUE, IOWA IS IN COMPLIANCE WITH THE TERMS OF THE CITY'S OFFERING FOR DISPOSITION OF SUCH PROPERTY Whereas, this Council, by Resolution No. 215-06, dated June 5, 2006, nominated the City Clerk as agent of the City of Dubuque, Iowa, to receive and open on July 10, 2006, at 10:00 a.m., proposals for the disposition of property in the Greater Downtown Urban Renewal District in the Port of Dubuque in accordance with the terms and conditions set forth in the resolution; and Whereas, the City Council has received a proposal, referred to in said resolution, from Port of Dubuque Brewery Development, LLC, which proposal meets the terms and conditions of Resolution No. 215-06; and Whereas, the City Clerk has reported to this Council that no qualified, competing proposals were submitted. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. That the report of the City Clerk that no qualified competing proposals were submitted by 10:00 a.m. on July 10, 2006, for the disposition of property in the Greater Downtown Urban Renewal District in the Port of Dubuque be received, filed and adopted. Section 2. That it is hereby determined that the proposal of Port of Dubuque Brewery Development, LLC for the development and lease of said property is the only proposal which satisfies the terms and conditions set forth in Resolution No. 215-06 adopted by this Council on June 5, 2006. Passed, approved and adopted this 17th day of July,2006. Roy.D. Buol, Mayor Attest: Jeanne F. Schneider, City Clerk F:\USERS\DHeiar\Port of Dubuque Brewery Development LLC\Port of Dubuque Development Compliance for Dispo resolution.doc RESOLUTION NO. 331-06 ACCEPTING THE PROPOSAL FROM PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC FOR THE LEASE OF PROPERTY IN THE GREATER DOWNTOWN URBAN RENEWAL DISTRICT IN THE PORT OF DUBUQUE IN THE CITY OF DUBUQUE, IOWA AND APPROVING THE DEVELOPMENT AGREEMENT AND LEASE AGREEMENT WITH PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC FOR THE LEASE OF THE PROPERTY Whereas, this Council, by Resolution No. 215-06, dated June 5, 2006: 1. Adopted the terms and conditions for offering for disposition certain real property and improvements in the Greater Downtown Urban Renewal District in the City of Dubuque, Iowa, referred to as the Star Brewery Property; 2. Determined that the proposal submitted by Port of Dubuque Brewery Development, LLC satisfied the requirements of said offering; 3. Declared its intent to accept the Port of Dubuque Brewery Development LLC proposal in the event no other qualified proposals were timely submitted for the property; and 4. Invited competing proposals which met the terms and conditions of the offering, to be submitted to the City Clerk on or before 10:00 a.m., July 10, 2006; and; Whereas, on June 7,2006, the Resolution was published as the official notice ofthe offering and of the intent of the City of Dubuque, Iowa, in the event no other qualified proposals were timely submitted, to approve the Development Agreement and Lease Agreement proposed by Port of Dubuque Brewery Development, LLC; and Whereas, by separate Resolution of this date, this Council has received and approved as its own the report of the City Clerk that no other qualified proposal was received; an Whereas, it is the determination of this Council that approval of the Development Agreement and Lease Agreement with Port of Dubuque Brewery Development, LLC, attached hereto, is in the public interest of the citizens of the City of Dubuque, and is consistent with the City's Urban Renewal Plan for the Greater Downtown Urban Renewal District. 1 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. That the attached Development Agreement and Lease Agreement by and between the City of Dubuque and Port of Dubuque Brewery Development, LLC are in the public interest of the citizens of the City of Dubuque and in furtherance of the City's Urban Renewal Plan, and are hereby approved. Section 2. That the Mayor is hereby authorized and directed to execute said Development Agreement and Lease Agreement on behalf of the City of Dubuque and the City Clerk is authorized and directed to attest to his signature. Section 3. That the City Manager is authorized to take such actions as are necessary to implement the terms of the Development Agreement and Lease Agreement as herein approved. Passed, approved and adopted this 17th day of July, 2006. Roy D. Buol, Mayor Attest: Jeanne F. Schneider City Clerk F:\USERS\DHeiar\Port of Dubuque Brewery Development LLC\Port of DUbuque Brewery Development Proposal Acceptance Resolution.doc = DEVELOPMENT AGREEMENT BETWEEN THE CITY OF DUBUQUE AND PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC This DEVELOPMENT AGREEMENT (the Agreement) made on or as of the day of , 2006 (the Effective Date), by and between the City of Dubuque, Iowa, a municipality (City), established pursuant to Iowa law and acting under authorization of Iowa Code Chapter 403, as amended (the Urban Renewal Act) and Port of Dubuque Brewery Development, LLC, an Iowa Limited Liability Company (Developer). 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 Greater Downtown Urban Renewal District (the Project Area); and WHEREAS, as of the Effective Date of this Agreement there has been prepared and approved by City an Urban Renewal Plan for the Project Area consisting of the Greater Downtown Urban Renewal Plan approved by City Council of City on the 19th of April, 2004, attached hereto as Exhibit "A," (the Urban Renewal Plan); and WHEREAS, a copy of the Urban Renewal Plan, as constituted on the Effective Date of this Agreement, has been recorded in the office of the Recorder of Dubuque County, Iowa; and WHEREAS, Developer has requested that City lease to Developer certain real property and improvements, commonly known as the Dubuque Star Brewery Building and Site, including non-exclusive use of the Alliant Amphitheater and additional use rights as set forth in paragraph 3.6, located in the City of Dubuque, Dubuque County, Iowa (the Property), legally described in Exhibit "B," attached hereto and incorporated herein by reference, so that Developer may redevelop the Property, located in the Project Area, for and in accordance with the uses specified in the Urban Renewal Plan and in accordance with this Agreement. Developer shall have exclusive use of Area A and exclusive use of Area B, both as depicted on Exhibit C attached hereto and by this reference made a part hereof; and WHEREAS, City believes that the redevelopment 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, and does not conflict with any term, covenant or condition of the Urban Renewal Plan. NOW THEREFORE, in consideration of the promises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: SECTION 1. LEASE OF PROPERTY TO DEVELOPER 1.1 Lease. On the Closing Date, City shall transfer possession of the Property pursuant to a lease with the Developer (the Lease) for a term of fifty (50) years. Tenant shall have the right to extend the lease for one additional 10 year term based upon the terms and conditions contained in paragraph 25 of the Lease. The Lease shall be in the form of Exhibit "D" attached hereto. 1.2 Recordation of Lease. Developer shall promptly record a Memorandum of Lease as stipulated in the Lease in the office of the Recorder of Dubuque County, Iowa. Developer shall pay all the costs for so recording. 1.3 Condition of Propertv. City shall deliver the Property in its "as is" condition. 1.4 Representations of Citv. In order to induce Developer to enter into this Agreement, City hereby represents and warrants to Developer that by the Closing Date and to the best of City's knowledge: (1) City is the owner of the Property in fee simple subject to no liens or encumbrances. (2) City has duly obtained all necessary approvals and consents for its execution, delivery and performance of this Agreement and the Lease, and that it has full power and authority to execute, deliver and perform its obligations under this Agreement and the Lease. 1.5 Conditions to Closina. 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 contingencies: (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. (2) Developer shall have obtained any and all necessary governmental approvals, including without limitation approval of zoning, subdivision or platting, and of the Construction Plans pursuant to Section 2.2 below that are necessary or desirable in connection with the Lease and development of the Property. Any conditions imposed as a part of the zoning, platting, subdivision or plan approval must be satisfactory to Developer, in its sole discretion. City shall cooperate with Developer in attempting to 2 obtain any such approvals, provided that City shall bear no expense in connection therewith. (3) Developer and City shall be in compliance with all the material terms and provisions of this Agreement. (4) City shall have received an opinion of counsel in the form attached hereto as Exhibit "E." (5) Developer shall have furnished City with evidence, in a form satisfactory to the City as City shall determine in the reasonable exercise of its discretion (such as a letter of commitment from a bank or other lending institution), that Developer has firm debt and/or equity commitments sufficient in amount to complete construction of the Minimum Improvements (as defined herein) to the Property in conformance with Construction Plans (as defined herein), or City shall have received such other evidence of Developer's financial ability as in the reasonable judgment of City is required to complete such construction. (6) Developer and the City shall have entered into the Lease, in the form attached hereto as Exhibit "D". (7) Developer shall have received, reviewed and approved an abstract of title, provided at City's expense. In the event Developer objects to any matters revealed by such examination that are attributable to matters shown in the abstract of title, such objection shall be delivered to City not later than thirty (30) days after receipt by Developer of the abstract of title. City shall have a period of time equal to twenty (20) days after receipt of Developer's notice to correct Developer's objection to title, and if it shall fail to do so within said twenty (20) day period of time, then Developer shall, by written notice given to City on or before seven (7) days after expiration of the aforementioned twenty (20) day time period, notify City that (i) it has elected to declare this Agreement null, void and of no further effect, in which event neither party shall have any further liability hereunder; or (ii) it has elected to proceed to closing notwithstanding the objection. The Lease shall be subject to all matters revealed by the abstract except those matters which are objected to by Developer and corrected by City, or objected to by Developer and subsequently waived by Developer as provided for herein. (8) City shall have provided Developer with a copy of all current surveys of the Property that are in City's possession. (9) City and Developer shall have executed all documents that the parties deem necessary or required in connection with the Financial Assistance, as that term is defined below. 1.6 ClosinQ. The closing shall take place on or before July 3, 2006 (the Closing Date), or such other date as the parties may agree in writing. Exclusive possession of the Property shall be delivered to Developer on the Closing Date in its current condition 3 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 have been satisfied or waived. 1.7 Closinq Costs. The following costs and expenses shall be paid on or prior to the Closing Date: (1) City shall pay: (a) The transfer fee imposed on the conveyance, if any. (b) All special assessments whether levied, pending or assessed. (c) City's attorney's fees. (d) The cost of preparing and providing to Developer an abstract of title to the Property. City agrees that the abstract of title shall be provided no later than thirty (30) days prior to the Closing Date. (2) Developer shall pay: (a) The recording fee necessary to record the Memorandum of Lease. (b) Developer's attorney's fees. (c) Developer's broker and/or real estate commissions and fees, if any. 1.8 Real Estate Taxes. Developer shall pay all real estate taxes pursuant to the Lease Agreement. 1.9 No Other Exemptions. The Developer agrees not to apply for any other State or local property tax exemptions which are available with respect to the 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 Chapters 404 and 427 of the Code of Iowa, as amended. SECTION 2. REDEVELOPMENT ACTIVITIES 2.1 Required Minimum Improvements. Developer hereby agrees to rehabilitate the Property into a mixed-use commercial/entertainment complex at a total project cost of not less than $6,500,000 which shall include the improvements described in Exhibit F, attached hereto and incorporated herein by reference (the Minimum Improvements). The Minimum Improvements shall meet the Secretary of the Interior's Standards for Rehabilitation and Guidelines for Rehabilitating Historic Buildings. The design of the Minimum Improvements shall be compatible with the pedestrian orientation of adjoining 4 streets, Alliant Plaza and Riverwalk improvements, providing accommodation for public accessibility to these public rights of way and the adjacent Grand River Center (the Conference Center) via a public access easement through the common areas of the Property without damaging or reconfiguring the same, including the Star Brewery Building itself as deemed necessary by City, and specifically with the Port of Dubuque Design Standards. The public access easement shall be located and configured in a manner reasonably acceptable to Developer. The public access easement shall be specifically identified, including its location, dimensions and configuration on a plat or drawing which shall be subject to Developer's prior approval. Developer shall develop, construct and pay for a parking lot adjacent to the Dubuque Star Brewery building, which parking lot shall be located in that area created by the City's relocation of Shot Tower Drive as referred to in paragraph 3.6 hereof and referred to as Area B on Exhibit C (the "Parking Lot"). Developer shall be responsible for snow removal and similar maintenance with respect to the Parking Lot and shall further be responsible for any other maintenance, repair or replacement to the surface of the Parking Lot. Developer shall have the exclusive use of the Parking Lot and all areas within Area A on Exhibit C. Developer shall have the right to assign all or portions of such use to others, including Developer's sublessees with respect to the Dubuque Star Brewery Building. Tenant's obligations with respect to the Parking Lot and its exclusive rights with respect to the Parking Lot shall continue during the term of the Lease referred to in paragraph 1.1 or any renewals thereof. Developer shall not be required to pay any additional sums related to the exclusive use of the Parking Lot beyond the rent provided in the Lease. 2.2 Plans for Construction of Minimum Improvements. Plans and specifications with' respect to the construction of the initial Minimum Improvements (the Construction Plans) shall be approved by City provided they are in conformity with the Urban Renewal Plan, which incorporates the Port of Dubuque Master Plan Design Standards, this Agreement, and all applicable state and local laws and regulations. Those improvements relate specifically to the Stone Cliff Winery space and general improvements such as bathrooms, elevators, stair towers, etc. The parties agree and acknowledge that specific improvements which will constitute a portion of the Minimum Improvements with respect to specific tenants will not be determined until such time as leases have been signed with those tenants. To that end, Developer shall, not later than thirty (30) days prior to the Closing Date, submit to City, for approval by City, the Construction Plans and such additional documents as City may reasonably request with respect to the Minimum Improvements to be constructed by Developer on the Property. All work with respect to the Minimum Improvements shall be in conformity with the Construction Plans as approved by City and shall be coordinated with City improvements in the general vicinity of the Property, including, but not limited to, Alliant Plaza, Riverwalk, the Conference Center and street and utility improvements. It is agreed that approval of the Construction Plans by City is a condition to closing under Section 1.5(3) above, and unless such approval shall be given by City on or before the Closing Date, this Agreement shall be null and void. 5 2.3 Timinq of Improvements. Developer hereby agrees that construction of the Minimum Improvements on the Property shall be commenced within sixty (60) days after the Closing Date, and shall be substantially completed within sixty (60) months after the commencement of construction. Provided, however, Developer shall complete 35% of the Minimum Improvements within 24 months after commencement of construction. The time for performance of such obligations shall be suspended during the period of any delays caused by acts of God or other matters not within the control of Developer including, but not limited to, extreme weather conditions and/or other natural causes, casualty, labor problems (including, but not limited to, strikes, walk-outs, picketings, boycotts and shutdowns), governmental restriction upon the availability or use of labor or materials, or insurrection, embargoes, or delays in providing necessary consents or approvals unless otherwise agreed upon in writing by City and Developer. The time for performance of such obligations shall be extended only for the period of such delay. 2.4 Certificate of Completion. Promptly upon completion of the Minimum Improvements in accordance with those provisions of this Agreement relating solely to the obligations of Developer to construct the Minimum Improvements, including the dates for beginning and completion thereof, City shall furnish Developer with an appropriate instrument so certifying. Such certification shall be a conclusive determination of the satisfaction and termination of the agreements and covenants in this Agreement and in the Lease with respect to the obligations of Developer to construct the Minimum Improvements. SECTION 3. CITY PARTICIPATION 3.1 Assistance of Citv. For and in consideration of Developer's obligations hereunder to construct the Minimum Improvements, City agrees to provide to Developer the financial assistance described herein (the "Financial Assistance"). 3.2 Lease Terms. For and in consideration of Developer's obligations hereunder to construct the Minimum Improvements, City agrees to lease the Property to Developer pursuant to the terms of the Lease. 3.3 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 Act, 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 the 1st day of November, 2009 and continuing until the 1st day of May, 2020, 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 6 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"). Developer recognizes and agrees that the Economic Development Grants shall be paid solely and only from the incremental taxes collected by City in respect to the Minimum Improvements, which does not include property taxes collected for the payment of bonds and interest of each taxing district, and taxes for the regular and voter-approved physical plant and equipment levy, and any other portion required to be excluded by Iowa law, and thus such incremental taxes will not include all amounts paid by Developer as regular property taxes. (2) To fund the Economic Development Grants, City shall certify to the County prior to December 1 of each year, commencing the 1st day of December, 2007, 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, 2007, the Economic Development Grants in respect thereof would be paid to the Developer on November 1, 2008, and May 1, 2009. (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 "Star Brewery 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 Star Brewery TIF Account to pay the Economic Development Grants, as and to the extend set forth in Section 3.3(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 Star Brewery 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 3.3 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. 3.4 Intentionally Left Blank. 3.5 Intentionally Left Blank. 7 3.6 Citv Improvements/Amphitheater/Additional Use Riqhts. City further agrees to relocate Shot Tower Drive, also known as 4th Street, and to allow public parking at the parking lot adjacent to the McGraw-Hili office building after 6:00 p.m. and on weekends and holidays. City grants to Developer the non-exclusive right to use the Alliant Amphitheater in association with any events or business activities of Developer or any tenant or licensee of Developer at the Leased Premises as defined in the Lease. On or before the Closing Date, City shall develop a scheduling reservation system with respect to use of the Alliant Amphitheater to ensure no conflicts in use of the Alliant Amphitheater. 3.7 Vendor Status. City shall require that, with respect to the sale of any food or beverages, including wine, for any event held in the Alliant Amphitheater by any party, that such party shall be required to obtain a bid for the provision of such food or beverages, including wine, from Developer's subtenants located in the Dubuque Star Brewery Building. It is the intent of this paragraph that Developer shall have the right to grant to its subtenants the rights granted under the terms of this paragraph (the right to bid for the sale or provision of food or beverages, including wine, for all events in any way associated with the Alliant Amphitheater during the term hereof or any renewals or extensions). Developer shall have the excusive right to control or grant or lease to others the right to control the offering or selling of food or beverages, including wine, on any property located within Area A on Exhibit C attached hereto. SECTION 4. COVENANTS OF DEVELOPER 4.1 Insurance Coveraqes. Developer shall obtain and maintain insurance as set forth in the Lease. 4.2 Non-Discrimination. In carrying out the project, Developer shall not discriminate against any employee or applicant for employment because of race, religion, color, sex, sexual orientation, national origin, age or disability. 4.3 Conflict of Interest. Developer agrees that no member, officer or employee of City, or its designees or agents, nor any consultant or member of the governing body of City, and no other public official of City who exercises or has exercised any functions or responsibilities with respect to the Project during his or her tenure, or who is in a position to participate in a decision-making process or gain insider information with regard to the Project, shall have any interest, direct or indirect, in any contract or subcontract, or the proceeds thereof, for work to be performed in connection with the Project, or in any activity, or benefit therefrom, which is part of this Project at any time during or after such person's tenure. 4.4 Non-transferabilitv. This Agreement may not be assigned by Developer without the prior written consent of City, which consent shall not be unreasonably withheld. Transfer or assignment of the Lease shall be governed by the terms thereof. 8 SECTION 5. INDEMNIFICATION 5.1. Developer's Indemnification of Citv. (1) Developer releases City and its governing body members, officers, agents, servants and employees thereof (hereinafter, for purposes of this Section 5, the "Indemnified Parties") from and 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 Property and the Minimum Improvements. (2) Except for any willful misrepresentation or any willful or wanton misconduct or any unlawful act of the Indemnified Parties, Developer agrees to protect and defend the Indemnified Parties, now or forever, and further agrees to hold the Indemnified Parties harmless, from any claim, demand, suit, action or other proceedings whatsoever by any person or entity whatsoever arising or purportedly arising from (i) any violation of any agreement or condition of this Agreement, except with respect to any suit, action, demand or other proceeding brought by Developer against City to enforce its rights under this Agreement or (ii) the construction, installation, ownership and operation of the Minimum Improvements or (iii) the condition of the Property and any hazardous substance or environmental contamination located in or on the Property which is caused by Developer after Developer takes possession of the Property. (3) The Indemnified Parties shall not be liable for any damage or injury to the persons or property of Developer or its officers, agents, servants or employees or any other person who may be about the Property or the Minimum Improvements other than any act of negligence on the part of any such Indemnified Parties. (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 5A shall survive the termination of this Agreement. 5.2 City's Indemnification of Developer. (1) City releases Developer and its owners, officers, agents, servants and employees (hereinafter, for purposes of this Section 5, also referred to as the "Indemnified Parties") from and covenants and agrees that Indemnified Parties under this paragraph 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 Property 9 prior to the Closing Date, or any loss, damage or expense associated with any environmental condition existing at the Property as of the Closing Date. (2) Except for any willful misrepresentation or any willful or wanton misconduct or any unlawful act of Developer or its owners, officers, agents, servants and employees, City agrees to protect and defend Developer or its owners, officers, agents, servants and employees, now or forever, and further agrees to hold the Developer and its owners, officers, agents, servants and employees harmless from any claim, demand, suit, action or other proceedings whatsoever by any person or entity whatsoever arising or purportedly arising from (i) any violation of any agreement or condition of this agreement by City, except with respect to any suit, action, demand or other proceeding brought by City against Developer to enforce its rights under this agreement; or (ii) negligence of the City or (iii) the condition of the Property as of the Closing Date and any hazardous substance or environmental contamination located in or on the Property which is or was caused by City at any time. (3) The Indemnified Parties shall not be liable for any damage or injury to the persons or property of City or its governing body members, officers, agents, servants and employees or any other person who may be about the property or the Minimum Improvements other than any act of negligence on the part of any such Indemnified Parties. (4) All covenants, stipulations, promises, agreements and obligations of Developer contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of Developer and not of any owner, officer, agent, servant or employee of Developer in the individual capacity thereof. (5) The provisions of this Section 58 shall survive the termination of this agreement. SECTION 6. EVENTS OF DEFAULT AND REMEDIES 6.1 Events of Default Defined. The following shall be Events of Default under this Agreement and Event of Default shall mean, whenever it is used in this Agreement, any one or more of the following events: (1) Any event of default by Developer under the Lease. (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) Failure by Developer to cause the Minimum Improvements to be reconstructed when required pursuant to the Lease. 10 (4) Transfer of any interest by Developer of the Minimum Improvements in violation of the provisions of this Agreement. (5) Failure by Developer to substantially observe or perform any other covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement or the Lease. (6) Developer shall: (a) file any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act of 1978, as amended, or under any similar federal or state law; (b) make an assignment for the benefit of its creditors; (c) admit in writing its inability to pay its debts generally as they become due; or (d) be adjudicated a bankrupt or insolvent: or if a petition or answer proposing the adjudication of Developer as a bankrupt or its reorganization under any present or future federal bankruptcy act or any similar federal or state law shall be filed in any court and such petition or answer shall not be discharged or denied within ninety (90) days after the filing thereof, or a receiver, trustee or liquidator of Developer or of Minimum Improvements, or part thereof, shall be appointed in any proceedings brought against Developer, and shall not be discharged within ninety (90) days after such appointment, or if Developer shall consent to or acquiesce in such appointment. 6.2 Notice of Default. City shall issue a written notice of default providing therein a thirty (30) day period in which Developer shall have an opportunity to cure such default. In the event the default is of a nature that cannot be cured within the aforementioned thirty (30) day time period, then Developer shall be deemed to be curing the default if Developer, within thirty (30) days after receipt of notice thereof, commences action to cure the default and prosecutes the same to completion, such that the default is cured within a reasonable time under all of the facts and circumstances then existing. 6.3 Remedies Upon Default. If the default remains unremedied after such thirty (30) day period, City shall have the right to do one or more of the following: (1) exercise any remedy provided by law; (2) suspend City's performance under this Agreement; (3) terminate this Agreement and the Lease; 11 (4) withhold certification of completion with respect to the Minimum Improvements; (5) require repayment of all Financial Assistance provided to the Developer, and/or the payment of damages by Developer for any costs incurred by City in connection with the default; and (6) Property. take such action as may be necessary to remove Developer from the 6.4 No Implied Waiver. In the event any term, covenant or condition contained in this Agreement is breached by any party and thereafter waived by any other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. SECTION 7. GENERAL TERMS AND PROVISIONS 7.1 Notices and Demands. Whenever this Agreement requires or permits any notice or written request by one party to another, it shall be in writing, enclosed in an envelope, addressed to the party to be notified, properly stamped, sealed and deposited in the United States Mail, and (1) in the case of Developer, is addressed to Epic Construction, Inc., 137 Main Street, Suite 500, Dubuque, IA 52001; or (2) in the case of City, is addressed to the City Manager, City Hall, 50 W. 13th Street, Dubuque, IA 52001; or at such other address with respect to either party as that party may, from time to time designate in writing and forward to the other as provided in this Section. Any notice delivered hereunder shall be deemed delivered upon the earlier of the actual receipt or two (2) business days after posting. 7.2 Compliance with Laws and Reaulations. Developer shall comply with all applicable City, state and federal laws, rules, ordinances, regulations and orders. 7.3 Bindina Effect. This Agreement shall be binding upon and shall inure to the benefit of City and Developer and their respective successors and assigns. 7.4 Termination Date. This Agreement and the rights and obligations of the parties hereunder shall terminate upon termination of the Assessment Agreement (the Termination Date). 12 7.5 Execution Bv Facsimile. The parties agree that this Agreement may be transmitted between them by facsimile. The parties intend that 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. 7.6 Memorandum of Development Aqreement. Developer shall promptly record a Memorandum of Development Agreement in the form attached hereto as Exhibit G in the office of the Recorder of Dubuque County, Iowa. Developer shall pay the costs for so recording. CITY OF DUBUQUE, IOWA PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC By: Roy D. Buol, Mayor By: Wayne Briggs, Managing Member By: Jeanne F. Schneider, City Clerk F:\USERS\tsteckle\Lindahl\Port of Dubuque Brewery Redevelopment LLC\Port of Dubuque Development Agreement Final053006bal.doc Last saved by Tracey Stecklein; 6/2/2006 10:13 AM 13 URBAN RENEWAL PLAN Greater Downtown Urban Renewal District (A merger of the Downtown Dubuque and Ice Harbor Urban Renewal Districts) City of Dubuque, Iowa This Urban Renewal Plan provides for the merger of the Downtown Urban Renewal Area Project Number Iowa R-15, originally established by Resolution 123-67 by the City Council of the City of Dubuque, Iowa on May 18, 1967 and subsequently amended and restated by Resolution 79-71 on March 15, 1971, by Resolution 73-74 on March 11,1974, by Resolution 107-82 on May 3,1982, by Resolution 191-84 on June 25, 1984, by Resolution 371-93 on December 6, 1993, by Resolution 145-94 on May 2, 1994, by Resolution 479-97 on November 17, 1997, by Resolution 476-98 on October 19, 1998 and by Resolution 187-02 on April 1, 2002, with the Ice Harbor Urban Renewal District, originally established by Resolution 403-89 of the City Council of the City of Dubuque, Iowa on December 18, 1989 and subsequently amended and restated by Resolution 241-00 on June 5, 2000 and by Resolution 114-02 on March 4, 2002, that merger adopted by Resolution 170-04 on April 19, 2004. Prepared by the Economic Development Department April 2004 15 TABLE OF CONTENTS A. INTRODUCTION B. JUSTIFICATION FOR THE DESIGNATION C. OBJECTIVES OF THE PLAN D. DISTRICT BOUNDARIES E. PUBLIC PURPOSE ACTIVITIES F. DEVELOPMENT AND REDEVELOPMENT REQUIREMENTS 1. LAND USE 2. PLANNING AND DESIGN CRITERIA G. LAND ACQUISITION AND DISPOSITION H. RELOCATION REQUIREMENTS I. FINANCING ACTIVITIES J. STATE AND LOCAL REQUIREMENTS K. DURATION OF APPROVED URBAN RENEWAL PLAN L. SEVERABILITY M. AMENDMENT OF APPROVED URBAN RENEWAL PLAN N. ATTACHMENTS Page 1 Page 1 Page 2 Page 3 Page 4 Page 5 Page 5 Page 6 Page 7 Page 8 Page 8 Page 10 Page 10 Page 10 Page 11 Page 11 A. INTRODUCTION This URBAN RENEWAL PLAN ("the Plan") has been prepared to provide for the merger of two existing Urban Renewal Districts and to stimulate, through public actions, financing and commitments, private investment within the combined area, to be known as the Greater Downtown Urban Renewal District ("the District"). In order to achieve this objective, the City of Dubuque shall undertake the urban renewal actions specified in this Plan, pursuant to the powers granted to it under Chapter 403 of the Iowa Code, Urban Renewal Law, and Chapter 15A of the Iowa Code. This Plan is a merger of the Downtown Dubuque Urban Renewal District Urban Renewal Plan, originally established by Resolution 123-67 by the City Council of the City of Dubuque, Iowa on May 18,1967 and subsequently amended by Resolution 79-71 on March 15, 1971, by Resolution 73-74 on March 11, 1974, by Resolution 107-82 on May 3,1982, by Resolution 191-84 on June 25,1984, by Resolution 371-93 on December 6,1993, by Resolution 145-94 on May 2,1994, by Resolution 479-97 on November 17, 1997, by Resolution 476-98 on October 19, 1998 and by Resolution 187-02 on April 1 ,2002 and the Ice Harbor Urban Renewal District Urban Renewal Plan, originally established by Resolution 403- 89 of the City Council of the City of Dubuque, Iowa on December 18, 1989 and subsequently amended and restated by Resolution 241-00 on June 5, 2000 and by Resolution 114-02 on March 4, 2002 ("the Merged Districts"). This Plan shall serve as a new urban renewal plan for the Merged Districts described herein. The Plan shall be viewed as a single plan for purposes of fulfilling the objectives of the Plan. B. JUSTIFICATION FOR THE DESIGNATION The City Council of the City of Dubuque, Iowa has determined that the following blighting conditions, as defined by Chapter 403 of the Iowa Code, Urban Renewal Law, exist within the District: . Undeveloped and underdeveloped land; . A preponderance of deteriorated, dilapidated and obsolete public and private improvements; . A faulty lot layout in relation to the size, adequacy and usefulness of the lots; . Fragmented property ownership patterns; . A lack of public utilities; and . An inadequate street layout. 1 The Council has declared by Resolution of Necessity No. 86-04 on March 1, 2004 that these factors have substantially impaired and arrested the sound growth of the City of Dubuque and of the area comprising the Merged Districts. C. OBJECTIVES OF THE PLAN The primary OBJECTIVES of the Plan are: 1. The creation of a thriving central business and riverfront district with a compatible mix of viable commercial/retail, office, financial, residential, cultural, recreational and educational activities; 2. The development of an adequate support system for new and expanding river-related tourism activities; 3. The conservation, restoration, renovation or rehabilitation of the historic and architectural character of the District through the establishment of design standards to ensure cohesive and compatible development and redevelopment, the use of appropriate construction techniques, the coordinated administration of appropriate code enforcement efforts and the maximization of all available financial and technical resources; 4. The creation of a safe, healthy and attractive physical environment through the construction or installation of necessary infrastructure and other public improvements or actions supportive of the District; 5. The creation of a safe, efficient, and attractive circulation system for both pedestrian and vehicular traffic; 6. The development of additional and improved parking opportunities in the District supportive of the businesses located within its boundaries and which accommodate the needs of its residents; 7. The creation of financial incentives necessary to encourage private investment and reinvestment in the District; 8. The creation and retention of quality employment opportunities in the District; and 9. The expansion of the existing property tax base of the District. 2 D. DISTRICT BOUNDARIES The District is located within the City of Dubuque, County of Dubuque, State of Iowa. The District includes five separate subareas that have resulted from prior expansions of the Merged Districts: the Town Clock Subarea, the Old Main Subarea, the Upper Main Subarea, the Ice Harbor Subarea A and Ice Harbor Subarea B. Despite this subdivision of the District, this Plan shall be viewed as a single plan and shall be applied to all subareas for purposes of fulfilling the objectives of the Plan. The boundaries of each subarea are as follows: 1. The Town Clock Subarea of the District shall include that area generally bounded on the North by Ninth Street but also including the Iowa Inn property and the public parking lot known as Parking Lot Number 1 located between 9th and 10th Streets east of Iowa Street, on the West by Locust Street including City Lots 623 and 624 (Dubuque Museum of Art), on the South by Fourth Street, and on the East by Central Avenue, including all public rights-of-way. 2. The Old Main Subarea of the District shall include that area generally bounded on the North by Fourth Street, on the West by Locust Street, on the South by the Locust Street Connector and on the East by the U.S. Highway 151/61 right-of-way, including all public rights-of-way. 3. The Upper Main Subarea of the District shall include that area generally bounded on the North by Fourteenth Street, on West by Locust Street, on the South by the Town Clock Subarea and on the East by Central Avenue, including all public rights-of-way. 4. Ice Harbor Subarea A of the District shall include that area generally bounded on the north by the public alley located between the vacated Fourth Street and Third Street, on the west by the Chicago, Central and Pacific Railroad right-of-way, on the south by East First Street and on the east by the municipal limits of the City of Dubuque, Iowa and including any adjoining public right-of-way. 5. Ice Harbor Subarea B of the District shall include that area generally bounded on the north and west by the Chicago, Central and Pacific Railroad right-of-way, on the south by the northerly boundary of Subarea A and on the east by the municipal limits of the City of Dubuque 3 (excluding Lot 1 Adams Co.'s 2nd Addition) and including any adjoining public right-of-way. The boundaries of the District and the subareas are delineated on the URBAN RENEWAL DISTRICT map (Attachment A). The City of Dubuque reserves the right to modify the boundaries of the District at some future date. Any amendments to the Plan will be completed in accordance with Chapter 403 of the Iowa Code, Urban Renewal Law. E. PUBLIC PURPOSE ACTIVITIES To meet the OBJECTIVES of this Plan, the City of Dubuque is prepared to initiate and support development and redevelopment of the District through the following PUBLIC PURPOSE ACTIVITIES: 1. Pre-development planning, including but not limited to activities such as appraisals, architectural and engineering studies, environmental assessment and remediation, and feasibility analysis; 2. Provision of technical support to property owners, businesses and organizations in support and furtherance of the Plan; 3. Use of tax increment financing, loans, grants and other appropriate financial tools in support of eligible public and private conservation, preservation, development and redevelopment efforts including the adaptive re-use of existing structures and code compliance; 4. Preparation of property for conservation, preservation, rehabilitation, development and redevelopment purposes; 5. Development and implementation of a program for the repair, restoration, and renovation of historic buildings and related improvements; 6. Improvement, installation, construction and reconstruction of public facilities and improvements including but not limited to structured parking facilities, other parking facilities, streets, alleys, utilities, convention facilities, Riverwalk and Harborwalk improvements and amenities, boat docks, dredging and other river-related improvements; 7. Improvement, installation, construction and reconstruction of other public improvements including but not limited to the relocation of overhead utility lines, installation of street lights, construction of public rest rooms 4 and water fountains, installation of benches and other streetscape amenities, landscaping and signage; 8. Acquisition of property through negotiation or eminent domain for public improvements or private development and redevelopment purposes; 9. Disposition of land through sale or lease; 10. Relocation or elimination of existing private improvements; 11. Relocation or elimination of existing railroad spur lines; 12. Demolition and clearance of deteriorated, obsolescent and blighting structures and other improvements not found to be of historical or architectural significance, including but not limited to site preparation for redevelopment purposes; and 13. Enforcement of applicable local, state and federal laws, codes and regulations; Public purpose activities are limited to those areas delineated on the PUBLIC PURPOSE ACTIVITY AREA map (Attachment B). All public purpose activities shall be conditioned upon and shall meet the restrictions and limitations placed upon the District by the Plan. F. DEVELOPMENT AND REDEVELOPMENT REQUIREMENTS The LAND USE and PLANNING AND DESIGN CRITERIA set forth herein shall apply to any and all District properties the preservation, conservation, development and/or the redevelopment of which is assisted by the City through any of the PUBLIC PURPOSE ACTIVITIES listed above. 1. LAND USE: a. Town Clock Subarea: The intent of this Plan is to promote the preservation, conservation, development and redevelopment of a functional, attractively developed environment to further existing office, financial, commercial/retail, cultural, educational, personal and professional services and residential activities within the Town Clock Subarea. 5 The continued development and enhancement of those land uses permitted within the Downtown Commercial Business District (C-4), the Business District (C-5) and the Office Residential (OR) zones of the City of Dubuque's Zoning Ordinance are encouraged. LAND USE maps (Attachments C-1 and C-2) identify the existing and the proposed land uses within the Town Clock Subarea. b. Old Main Subarea: The intent of this Plan is to promote private investment and reinvestment in a variety of commercial/retail, entertainment and residential uses while furthering existing commercial/retail, personal and professional services, entertainment and residential activities within the Old Main Subarea. The continued development and enhancement of those land uses permitted within the Downtown Commercial Business District (C-4) and Business District (C-5) zones of the City of Dubuque's Zoning Ordinance are encouraged. LAND USE maps (Attachments C-3 and C-4) identify the existing and the proposed land uses within the Old Main Subarea. c. UDDer Main Subarea: The intent of this Plan is to promote the preservation, conservation, development and redevelopment of this downtown neighborhood of residential, office and commercial/retail uses. The continued development and enhancement of those land uses permitted within the Downtown Commercial Business District (C-4), the Business District (C-5), the Office Residential (OR) and Office Service (OS) zones of the City of Dubuque's Zoning Ordinance are encouraged. LAND USE maps (Attachments C-5 and C-6) identify the existing and the proposed land uses within the Upper Main Subarea. d. Ice Harbor Subareas A and B: The intent of this plan is to encourage a mix of residential, commercial/retail, recreational and educational uses in these Subareas. An adopted Planned Unit Development ordinance shall regulate land uses and zoning in the Ice Harbor Subareas A and B. 6 LAND USE maps (Attachments C-7 and C-8) identify the existing and the proposed land uses within the Ice Harbor Subareas A and B. 2. PLANNING AND DESIGN CRITERIA: a. Town Clock. Old Main and Upper Main Subareas: The planning and design criteria to be used to guide the physical development and redevelopment of the Town Clock, Old Main and Upper Main Subareas are those standards and guidelines contained within the City of Dubuque's Zoning Ordinance and other applicable local, state and federal codes and ordinances subject to the conditions contained in this subsection. b. Ice Harbor Subareas A and B: The planning and design criteria to be used to guide the physical development and redevelopment of the Ice Harbor Subareas A and B shall be the Port of Dubuque Master Plan Design Standards attached hereto as Attachment D. c. Historic Preservation Commission Review: Additionally, the Secretary of the Interior's Standards for Rehabilitation and Guidelines for Rehabilitating Historic Structures shall be used to guide the exterior modifications of historic and architecturally significant properties financed in whole or in part by the City of Dubuque and the improvement, installation, construction or reconstruction of public improvements in the District. Said projects shall be reviewed by the Historic Preservation Commission for compliance with the above referenced standards. d. Off-Premise Sianaae: No off-premise signage shall be allowed in the Ice Harbor Subareas A and B. e. Overhead Utilitv Lines: No new overhead utility lines shall be installed within the District where underground placement is feasible. G. LAND ACQUISITION AND DISPOSITION The City of Dubuque is prepared to acquire and dispose of property in support of the development and redevelopment of the District within the parameters set forth below. 1. Land Acauisition: The City may acquire property for private development or redevelopment by contractual agreement or by right of eminent domain. The City reserves the right to acquire, by negotiation or eminent domain, property rights required for the construction or reconstruction of streets and public utilities, or any other public facility or improvement. No properties are identified for acquisition in this Plan. 7 2. Land Disposition: Publicly held land will be sold for the development of viable uses consistent with this Plan, and not for purposes of speculation. Land will be disposed of in accordance with the requirements set forth in Chapter 403 of the Iowa Code, Urban Renewal Law. Developers and redevelopers will be selected on the basis of the quality of their proposals and their ability to carry out such proposals while complying with the requirements of this Plan. Developers and redevelopers will be required by contractual agreement to observe the Land Use Requirements and Planning and Design Criteria of this Plan. The contract and other disposition documents will set forth the provisions, standards and criteria for achieving the objectives and requirements outlined in this Plan. H. RELOCATION REQUIREMENTS Relocation assistance in accordance with applicable provisions of Chapter 316 of the Iowa Code, Highway Relocation Assistance Law, will be provided in the event that an existing business or residence is displaced by publicly supported development or redevelopment activities. I. FINANCING ACTIVITIES To meet the OBJECTIVES of this Plan and to encourage the development and redevelopment of the District and private investment therein, the City of Dubuque is prepared to provide financial assistance to qualified industries, businesses and housing developers through the making of loans or grants under Chapter 15A of the Iowa Code and through the use of tax increment financing under Chapter 403 of the Iowa Code. 1. Chapter 15A Loan or Grant: The City of Dubuque has determined that the making of loans or grants of public funds to qualified industries, businesses and housing developers is necessary to aid in the planning, undertaking and completion of urban renewal projects authorized under this Plan within the meaning of Section 384.24(3)(q) of the Iowa Code. Accordingly, in furtherance of the objectives of this Plan, the City of Dubuque may determine to issue bonds or loan agreements, in reliance upon the authority of Section 384.24A, Section 384.24(3)(q), Section 403.12 (general obligation bonds) or Section 403.9 (tax increment bonds), for the purpose of making loans or grants of public funds to qualified entities. Altematively, the City may determine to use available funds for the making of such loans or grants. In determining qualifications of recipients and whether to make any such individual loans or grants, the City of Dubuque 8 shall consider one or more of the factors set forth in Section 15A.1 of the Iowa Code on a case-by-case basis. 2. Tax Increment Financinq: The City of Dubuque is prepared to utilize tax increment financing as a means of financing eligible costs incurred to implement the Public Purpose Activities identified in Section E of this Plan. Bonds or loan agreements may be issued by the City under the authority of Section 403.9 of the Iowa Code (tax increment bonds) or Section 384.24A, Section 384.24(3)(q) and Section 403.12 (general obligation bonds). The City acknowledges that the use of tax increment revenues delays the ability of other local taxing bodies to realize immediately the direct tax benefits of new development in the District. The City believes, however, that the use of tax increment revenues to finance the public improvements and to promote private investment in the District is necessary in the public interest to achieve the OBJECTIVES of this Plan. Without the use of this special financing tool, new investment may not otherwise occur or may occur within another jurisdiction. If new development does not take place in Dubuque, property values could stagnate and the City, County and School District may receive less taxes during the duration of this Plan than they would have if this Plan were not implemented. Tax increment financing will provide a long-term payback in overall increased tax base for the City, County and School District. The initial public investment required to generate new private investment will ultimately increase the taxable value of the District well beyond its existing base value. Tax increment reimbursement may be sought for, among other things, the following costs to the extent they are incurred by the City: a. Planning and administration of the Plan; b. Construction of any of the public improvements, amenities and facilities contemplated by the Plan within the District, including pre- development planning, environmental assessment and remediation, feasibility analysis and engineering costs; c. Acquisition, installation, maintenance and replacement of public improvements throughout the District including but not limited to street lights, benches, landscaping, appropriate signage and rest rooms; d. Acquisition of land and/or buildings and preparation of same for sale to private developers, including any "write down" of the sale price of the land and/or building; 9 e. Preservation, conservation, development or redevelopment of buildings or facilities within the District to be sold or leased to qualifying for-profit and not-for-profit organizations, developers and businesses; f. Loans or grants to qualified entities under Chapter 15A of the Iowa Code, including debt service payments on any bonds issued to finance such loans or grants, for purposes of expanding the business or activity, or other qualifying loan programs established in support of the Plan; and g. Providing the matching share for a variety of local, state and federal grants and loans. 3. Prooosed Amount of Indebtedness: At this time, the extent of improvements and new development within the District is only generally known. As such, the amount and duration for use of the tax increment revenues for public improvements and/or private development can only be estimated; however, the actual use and amount of tax increment revenues to be used by the City for District activities will be determined at the time specific development is proposed. It is anticipated that the maximum amount of indebtedness which will qualify for tax increment revenue reimbursement during the duration of this Plan, including acquisition, public improvements and private development assistance, will not exceed $75,000,000. Current indebtedness is approximately $39,000,000. At the time of adoption of this Plan, the City of Dubuque's current general obligation debt is $25,670,000 (a list of obligations is found as Attachment E) and the applicable constitutional debt limit is $121,793,282. J. STATE AND LOCAL REQUIREMENTS All provisions necessary to conform with state and local laws have been complied with by the City of Dubuque in the implementation of this Plan and its supporting documents. K. DURATION OF APPROVED URBAN RENEWAL PLAN 10 This Plan shall continue in effect until terminated by action of the City Council, but in no event before the City of Dubuque has received full reimbursement from all incremental taxes for its advances and principal and interest payable on all Tax Increment Financing or general obligations issued to carry out the OBJECTIVES of the Plan. The DEVELOPMENT AND REDEVELOPMENT REQUIREMENTS established, or as amended from time to time by the City of Dubuque Zoning Ordinance, shall remain in effect in perpetuity. L. SEVERABILITY In the event one or more provisions contained in this Plan shall be held for any reason to be invalid, illegal, unauthorized or unenforceable in any respect, such invalidity, illegality, unauthorization or unenforceability shall not affect any other provision of this Plan and this Urban Renewal shall be construed and implemented as if such provision had never been contained herein. M. AMENDMENT OF APPROVED URBAN RENEWAL PLAN This Plan may be amended from time to time to respond to development opportunities. Any such amendment shall conform to the requirements of Chapter 403 of the Iowa Code, Urban Renewal Law. Any change effecting any property or contractual right can be effectuated only in accordance with applicable state and local law. N. ATTACHMENTS The following attachments are a part of this Plan: A Urban Renewal District Map, with Subareas B Public Activity Area Map C Land Use Maps C-1 Town Clock Subarea Existing Land Use Map C-2 Town Clock Subarea Proposed Land Use Map C-3 Old Main Subarea Existing Land Use Map C-4 Old Main Subarea Proposed Land Use Map C-5 Upper Main Subarea Existing Land Use Map C-6 Upper Main Subarea Proposed Land Use Map C-7 Ice Harbor Subareas A and B Existing Land Use Map C-8 Ice Harbor Subareas A and B Proposed Land Use Map 11 D Port of Dubuque Master Plan Design Standards E List of Current General Obligation Debt F :IUSERSIPmyhreIWPDOCSIURIDWNlWN-ICEHARBORIgreaterdowntownplan .doc F:IUSERSIPmyhreIWPDOCSIURIDOWNTOWNldowntown-iceharborplan.doc 12 EXHIBIT B LEGAL DESCRIPTION OF PROPERTY The Property is located in Lot 2 Riverwalk 5th Addition in the City of Dubuque, Iowa, according to the recorded plat thereof. 13 -.. __"_\III:_"G. ......-.-~ll< UUIlUl.lUr,......,.ILllfAu.u9bf.v'-' -.................. Ml,_.$'" FINAL PLAT RIVERWALK SiH ADDITION IN iHE CITY Of' DUBUQUE. IOWA Of:stJW:>"'OON: lOTS 1-11 AAO 1-12, alOCl< '; lOTS 13 1HIW 16, LOTS 1-17, 1-18. 1-19, >>D 1-20. BlOCK Ii lOTS G AND H; A ~llOM (W VAt;A lED PIN[ STREET L't1NG 1I(1\1I[[H LOts 0 AIItO H; II PORlKIlI CIl M JO-FOOT \\IDE I,/1tt:.A. KD -'UE'I' L'l1HC HORTHEIIl y rs JH) ~T TO LOTS 13 lHflU 20. BLOCK 6; Au. IN Ol.e.KlUE HAABat 1UPRO'W{.l,d:NT COWPM/Y ADOIT\CIIfi TO mE eHY Of DUBUctJ{, DOWA.. AN) LOT 3. RI'wUMW( 4Th ADl>>lION IN THE CITY CK 0UBl.J0JE. IOW'A H Jl~'W E M.13"(8UO') N J",,,~ - ~~L.._ _JIl.lxr- '-~~ LOT A - BEu. 0(1' cqw 1,210 SQ. fT '0. _- SJ1'24'l1'" ~81' ~ -Nj'""2I'11-r J ....... I~ L- 25' SANITARY ~~:N~! J: I SlYl(R (ASlll€Nl PER lHIS PLA T~i'. I Pt"R M:S P\AT I :: 1 ~~rin:J I I I POt MS PLAT : I b-,-- NJ1'S1'1...E-J18!8'____..-. 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' - , --/ ~ O. ----1 r; I,: I '? : I : I ,; I i L' .l , : II; ; ~ i:f~:\ , e! I f~ I,! S: I d , 1", I ~ U " " , , " "l '''., ! :-::::-- ,I.j':..:.; --~"'--L -r--: . '--c'" __ ___ '-n i .' 'r. -.-- -- I ;.' ! I - - : --=--:. ~~.-=-. I,: : " f 'I' ~ I \ , , I \ . / I \ " I f \" \ \ \ , I I I I I I I I . , I . I ; I I . I I I I I I I I I . I I I I I I , I I I I I I I ~ I I I I I I I ,. '" ~ .. - :) en ::c Q -I -I Q ::e "' ::Il l:lI ::Il ;;: "' j--,,-j I I I ! , I ) I :1 ! , I I . I >,;t -.. I i ~i ~ J Ie ;: i I ~j ,. , I !l " , i / : 1/ I L_l BR~rAR BUILr,t':! '" i I 1 1'"0, -- -- -_I'....... ..... :""'-.--4 ,'" ~;.,;;;;~"~,"~:;:~~-.;::.~"",.~.,,- '~,:. .@-~.~"~.~~--'- . . .....\;) ~ ~ - ","', ';'-';-~'::--' ': ' -- -- "fif ~ " --''>'1 ,,41 =4 r~ - - - --= ""-,,:!~"""'- ~:-- -- , ",' I ;;G:";~~;1rl'... .,., ,0 L ffl-- ~'t~ ~, ~ ~ ~ ~ ~ i-C, I I I I '-, I I , 1'1: i ' 'j >..10.' :(;";. , ." ~"'''(.' 17 Mayor and City Councilmembers Cit~ Hall 13t and Central Avenue Dubuque IA 52001 Re: Development Agreement Between the City of Dubuque, Iowa and Dear Mayor and City Council members: We have acted as counsel for , (Developer) in connection with the execution and delivery of a certain Development Agreement (Development Agreement) between Developer and the City of Dubuque, Iowa ("City") dated for reference purposes the _ day of , 20_ We have examined the original certified copy, or copies otherwise identified to our satisfaction as being true copies, of the Development Agreement and such other documents and records as we have deemed relevant and necessary as a basis for the opinions set forth herein. Based on the pertinent law, the foregoing examination and such other inquiries as we have deemed appropriate, we are of the opinion that: 1. Developer is a limited liability company organized and existing under the laws of the State of and has full power and authority to execute, deliver and perform in full Development Agreement. Development Agreement has been duly and validly authorized, executed and delivered by Developer and, assuming due authorization, execution and delivery by City, is in full force and effect and is valid and legally binding instrument of Developer enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization or other laws relating to or affecting creditors' rights generally. 2. The execution, delivery and performance by Developer of the Development Agreement and the carrying out of the terms thereof, will not result in violation of any provision of, or in default under, the articles of incorporation and bylaws of Developer, any indenture, mortgage, deed of trust, indebtedness, agreement, judgment, decree, order, statute, rule, regulation or restriction to which the Developer is a party or by which Developer's property is bound or subject. 3. There are no actions, suits or proceedings pending or threatened against or affecting Developer in any court or before any arbitrator or before or by any governmental body in which there is a reasonable possibility of an adverse decision which could materially adversely affect the business (present or prospective), financial position or results of operations of Developer or which in any manner raises any questions affecting the validity of the Agreement or Developer's ability to perform Developer's obligations thereunder. 20 Exhibit F Star Brewery Budget Building Shell Buildouts General Conditions: $125,431 $81,000 Areh.iEng.: $150,000 $100,000 Demolition: $119,500 Excavation: $69,300 Parking Lot Paving: $140,000 Landscaping: $50,000 Concrete Floors: $163,500 513,000 Masonry: $900,000 Steel/Stairs: $215,600 R. Carpentry: $88,388 531,000 F. Carpentry: $100,000 Casework: $20,500 Roofing: $49,000 Insulation: $63,500 Doors: $90,000 Windows: $286,000 Interior Glazing: SI3,900 Drywall: $143,000 514,000 Acoustical Ceilings: $3,000 S35,700 Flooring: $126,000 Painting: $40,000 Specialties: $15,182 511,700 Signage: $10,000 Misc. Theming: $20,000 Kitchen Equipment: $400,000 Elevator: $100,000 Fire Sprinkler: $135,840 Plumbing: $140,000 $35,000 IIVAC: $500,000 Electrical: $480,000 $210,000 CM Fee: $407,774 $121,130 Development Fee: $300,000 Contingency: $300,000 $100,000 $5,085,515 $1,432,430 Total Project: $6,517,945 23 Prepared by: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563 583- 4113 Return to: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 MEMORANDUM OF DEVELOPMENT AGREEMENT A Development Agreement by and among the City of Dubuque, Iowa, an Iowa municipal corporation, of Dubuque, Iowa, and was made regarding the following described premises: The Development Agreement is dated for reference purposes the _ day of , 20_, and contains covenants, conditions, and restrictions concerning the sale and use of said premises. This Memorandum of Development Agreement is recorded for the purpose of constructive notice. In the event of any conflict between the provisions of this Memorandum and the Development Agreement itself, executed by the parties, the terms and provisions of the Development Agreement shall prevail. A complete counterpart of the Development Agreement, together with any amendments thereto, is in the possession of the City of Dubuque and may be examined at its offices as above provided. Dated this _ day of ,20_. CITY OF DUBUQUE, IOWA By: Roy D. Buol, Mayor By: 25 Jeanne F. Schneider, City Clerk STATE OF IOWA ss: DUBUQUE COUNTY On this _day of , 20_, before me, a Notary Public in and for the State of Iowa, in and for said county, personally appeared Roy D. Buol and Jeanne F. Schneider, to me personally known, who being by me duly sworn did say that they are the Mayor and City Clerk, respectively of the City of Dubuque, a Municipal Corporation, created and existing under the laws of the State of Iowa, and that the seal affixed to said instrument is the seal of said Municipal Corporation and that said instrument was signed and sealed on behalf of said Municipal corporation by authority and resolution of its City Council and said Mayor and City Clerk acknowledged said instrument to be the free act and deed of said Municipal Corporation by it voluntarily executed. Notary Public, State of Iowa STATE OF IOWA ss: DUBUQUE COUNTY On this _ day of , 20_, before me, a Notary Public in and for the State of Iowa, in and for said county, personally appeared to me personally known, who being by me duly sworn did say that they are the and that said instrument was signed on behalf of said company by authority of its members and that they acknowledged the execution of this instrument to be the voluntary act and deed of said company by it voluntarily executed. Notary Public, State of Iowa F:IUSERSIDHeiarlPorl of Dubuque Brewery Development LLCIPorl of Dubuque Development Agreement- FINAL-6-2-06.doc 26 LEASE AGREEMENT BETWEEN THE CITY OF DUBUQUE, IOWA AND PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC THIS LEASE AGREEMENT (the Lease) made as of the 1St day of July, 2006, by and between the CITY OF DUBUQUE, IOWA, a municipal corporation (Lessor), and Port of Dubuque Brewery Development, LLC, an Iowa Limited Liability Company (Lessee). WHEREAS, Lessee has requested that Lessor lease to Lessee that certain real property and improvements, commonly known as the Star Brewery, located in the City of Dubuque, Dubuque County, Iowa as described herein; and WHEREAS, the redevelopment of the Star Brewery is an economic development project involving private and public investment and the creation of new jobs and income; and WHEREAS, the redevelopment of the Star Brewery will generate commercial and tourism-related activities in support of the Port of Dubuque Master Plan. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the parties hereto agree as follows: ARTICLE 1 DEMISE AND TERM 1.1 Demise and Term. In consideration of the rents hereinafter reserved and the terms, covenants, conditions and agreements set forth in this Lease, Lessor hereby leases to Lessee the real property described as Area A, and the building thereon, as shown on Exhibit A attached hereto and by this reference made a part of this Lease, consisting of approximately 60,173 square feet of land, together with any and all easements and appurtenances thereto and subject to any easements and restrictions of record (the "Demised Premises"), to have and to hold for a term of fifty (50) years commencing as of the date of this Lease and ending on the 30th day of June, 2056. See paragraph 25 regarding option to renew. The Demised Premises is located in Lot 2 Riverwalk 5th Addition in the City of Dubuque, Iowa, according to the recorded plat thereof. The parties agree to amend Exhibit A upon determination of the exact location and extent of the Property and legal description. 1.2 Minimum Improvements. Lessee shall construct the Minimum Improvements (as defined in Section 2.1 of the Development Agreement) in the time and manner required by the Development Agreement. 1.3 Parking. Lessee shall develop, construct and pay for a parking lot adjacent to the Dubuque Star Brewery building in that area created by the City's relocation of Shot Tower Drive as referred to in paragraph 3.3 hereof (that area identified as Area B on Exhibit A, consisting of approximately 39,405 square feet) (the "Parking Lot"). Developer shall be responsible for snow removal and similar maintenance with respect to the Parking Lot and shall further be responsible for any other maintenance, repair or replacement to the surface of the Parking Lot. Developer shall have exclusive use of the Parking Lot. Developer shall have non-exclusive use of the Parking Lot. Developer shall have the right to assign all or portions of such use to others, including Developer's sublessees with respect to the Dubuque Star Brewery Building. Tenant's obligations with respect to the Parking Lot and its non-exclusive rights with respect to the Parking Lot shall continue during the term of the Lease referred to in paragraph 1.1 or any renewals thereof. Except for the maintenance and replacement obligations set forth herein with respect to Area B, Developer shall not be required to pay any additional sums related to the use of the Parking Lot beyond the rent provided in this Lease. While Tenant's use of the Parking Lot is on an non-exclusive basis, the parties recognize that in the event City or other parties hold events in the general Port of Dubuque area, it may be necessary for Tenant to have temporary exclusive rights with respect to use of the Parking Lot for the customers of Tenant's subtenants. Therefore, in the event the City or any other organization holds an event in the Port of Dubuque area that can reasonably be expected to adversely affect parking availability on the Parking Lot (such as, by way of example and not limitation, the occurrence of an event requiring a permit under the City of Dubuque Ordinances), Tenant may control access to the Parking Lot on the day of such event and upon not less than seven day's written notice to the City Manager to ensure that any persons using the Parking Lot are doing so with the intent of visiting the building upon the Demised Premises. Provided, however, Tenant's control of access to the Parking Lot shall be limited to no more than 50 days per year. ARTICLE 2 RENT 2.1 Lessee shall pay Lessor (in addition to taxes, assessments, and other charges required to be paid under this Lease by Lessee) rent for the Demised Premises as follows: (a) Lease nears one through five. During the initial five year term of the lease, ending the 30th day of June, 2011, Lessee shall pay rent in the amount of $1.00 per year; (b) Lease years six through fifteen. During years 6 through 15 of the lease, beginning the 1st day of July, 2011 and ending the 30th day 2 of June, 2021, Lessee shall pay annual rent equal to 10% of the fair market value of the land only comprised within the Demised Premises as of the date of this lease. The parties agree and acknowledge that the fair market value of such land as of the date of this lease is $450,000.00 per acre and that such land consists of 1.38 acres. The annual rent will be $62,100 or $5,175 per month. (c) Lease years sixteen through thirty. Within 180 days prior to the 30th day of June, 2021 Lessor and Lessee shall have prepared an appraisal of the underlying real estate which is a part of the Demised Premises (exclusive of the Dubuque Star Brewery Building and other improvements) by a certified appraiser experienced in appraising similar types of properties in the Dubuque area mutually selected by Lessor and Lessee. If either party is dissatisfied with the appraisal or the parties cannot agree on an appraiser, each shall, not later than 45 days prior to the 30tH day of June, 2021, appoint its own appraiser, each of which shall be experienced in appraising similar types of properties in the Dubuque area and the two appointed by the parties shall select a third experienced appraiser. The average appraised values of the three appraisers shall be the appraised value of the Demised Premises for the purposes of this paragraph 2.1(c). From the 1 st day of July, 2021 and through the 30th day of June, 2022, ("the Base Year") the annual rent shall be an amount equal to 10% of the appraised value of such land (the "Base Year Rent"). Beginning with the July 1, 2022 -June 30, 2023 lease year and through the lease year ending June 30, 2036, the annual rent shall increase each year by an amount equal to three percent (3%) each year over the annual rent due during the Base Year. The following table sets forth this calculation: Lease Year Annual Rent 16 (Base Year Rent equals10% of appraised value) 17 (Base Year Rent x 1.03) 18 (Base Year Rent x 1.06) 19 (Base Year Rent x 1.09) 20 (Base Year Rent x 1.12) 21 (Base Year Rent x 1.15) 22 (Base Year Rent x 1.18) 23 (Base Year Rent x 1.21) 24 (Base Year Rent x 1.24) 25 (Base Year Rent x 1.27) 26 (Base Year Rent x 1.30) 27 (Base Year Rent x 1.33) 28 (Base Year Rent x 1.36) 29 (Base Year Rent x 1.39) 3 30 (Base Year Rent x 1.42) (d) Lease years thirty-one through fifty. Within 180 days prior to June 30, 2036, Lessor and Lessee shall have prepared an appraisal of the underlying real estate which is a part of the Demised Premises, (exclusive of the Dubuque Star Brewery Building and other improvements) by a certified appraiser experienced in appraising similar types of properties in the Dubuque area mutually selected by Lessor and Lessee. If either party is dissatisfied with the appraisal or the parties cannot agree on an appraiser, each shall, not later than 45 days prior to the 30t" day of June, 2036, appoint its own appraiser, each of which shall be experienced in appraising similar types of properties in the Dubuque area and the two appointed by the parties shall select a third experienced appraiser. The average appraised values of the three appraisers shall be the appraised value of the Demised Premises for the purposes of this paragraph 2.1(d). From and after July 1, 2036 the annual rent shall be 10% of the appraised value of such land. This process of re- appraisal and Tenant paying annual rent equal to 10% of the new appraised value shall continue every 5 years during the remaining term of this Lease. All such rent shall be payable in twelve (12) equal monthly installments on the first day of each month. ARTICLE 3 TITLE TO IMPROVEMENTS AND TRADE FIXTURES 3.1 Trade Fixtures. For the purposes of this Lease, "Trade Fixtures" shall mean all of Lessee's personal property located on the Demised Premises used in Lessee's business whether or not such personal property is affixed to the Demised Premises. Title to Lessee's trade fixtures (the "Trade Fixtures") is and shall be the sole and exclusive property of Lessee during the term of this Lease and shall remain the sole and exclusive property of Lessee after the expiration or termination of this Lease, for whatever reason. Lessor acknowledges and understands that it shall have no right, title or interest in or to Lessee's Trade Fixtures either during the term of this Lease, or thereafter (except as hereinafter provided). Lessor acknowledges and agrees that Lessee shall have the right to encumber, sell, or hypothecate Lessee's Trade Fixtures, to remove them from the Demised Premises, or to otherwise deal with all or any portion of such Lessee's Trade Fixtures, at Lessee's sole discretion. Upon ten (10) days' prior written notice to Lessor, Lessor shall execute and deliver to Lessee a certificate in recordable form prepared by Lessee stating that Lessor has no interest or right in or to Lessee's Trade Fixtures, as well as any other or further document which Lessee may reasonably request from Lessor. 4 3.2 Improvements. On delivery of possession of the Demised Premises to Lessee, Lessee shall construct on the Demised Premises the Minimum Improvements as required by the Development Agreement (the "Improvements"). It shall be unreasonable for Lessor to withhold such consent if such design, appearance and quality are generally compatible with other such buildings in the area. Subject to applicable law and the obligations imposed on Lessor as a governmental entity, Lessor agrees to process as expeditiously as possible all permits, variances and approvals reasonably required to develop and construct the Improvements on the Demised Premises. All improvements presently on the Demised Premises and all Improvements hereafter constructed on the Demised Premises are and shall be the property of Lessee during the continuance of the term of this Lease and no longer. Subject to the payment obligations of Lessor set forth below, upon any termination of this Lease, by reason of any cause whatsoever, if the Improvements or any part thereof shall then be on the Demised Premises, all of Lessee's right, title, and interest therein shall cease and terminate, and title to the Improvements shall vest in Lessor, and the Improvements or the part thereof then within the Demised Premises shall be surrendered by Lessee to Lessor. No further deed or other instrument shall be necessary to confirm the vesting in Lessor of title to the Improvements. However, upon any termination of this Lease, Lessee, upon request of Lessor, shall execute, acknowledge and deliver to Lessor a quitclaim deed confirming that all of Lessee's right, title and interest in or to the Improvements have expired, and that title to the Improvements has vested in Lessor. 3.3 City Improvements. City shall construct the new Bell Street Extension (Shot Tower Drive), also known as East 4th Street to the north of the Star Brewery by moving such street northerly in order to allow Developer to create a parking area immediately to the west of the Star Brewery Building (Area B on Exhibit A). Developer shall develop, construct and pay for the parking lot and associated improvements, including but not limited to lighting and landscaping, in Area B for the non-exclusive use of Tenant. The improvements by the City shall be completed at City's expense on or before the 31 stday of July, 2007. Developer shall be responsible for snow removal and similar maintenance with respect to the parking lot. Developer shall also be responsible for any maintenance, repair or replacement to the surface of the parking lot. ARTICLE 4 ENCUMBRANCE OF LESSEE'S LEASEHOLD INTEREST 4.1 Lessee's Right to Encumber Leasehold Interest. Lessee may encumber by mortgage, deed of trust or other proper instrument, its leasehold interest and estate in the Demised Premises, together with all Improvements on the Demised Premises, as security for any indebtedness of Lessee, provided that no such encumbrance shall extend beyond the term of this Lease. Lessee shall provide prompt written notice to Lessor of any such encumbrance together with a copy of such encumbrance. In the event of any judicial or nonjudicial foreclosure 5 under any mortgage, deed of trust or other similar instrument made by Lessee covering its leasehold interest in the Demised Premises, Lessor shall, upon such foreclosure or sale, recognize the purchaser thereunder as lessee under this Lease, provided such purchaser expressly agrees in writing to be bound by the terms of this Lease and the Development Agreement between the parties. 4.2 Notice to Holder of Encumbrance• Right of Holder to Cure Lessee's Default. If Lessee shall encumber its leasehold interest and estate in the Demised Premises and if Lessee, or the holder of the indebtedness, its successors and/or assigns (the "Holder") secured by the encumbrance shall give notice to Lessor of the existence of the encumbrance and the address of the Holder, then Lessor shall mail or deliver to the Holder, at such address, a duplicate copy of all notices in writing which Lessor may, from time to time, give or serve on Lessee under and pursuant to the terms and provisions of this Lease. The copies shall be mailed or delivered to the Holder at, or near as possible to, the same time the notices are given to or served on Lessee. The Holder may, at its option, at any time before the rights of Lessee shall be terminated as provided in this Lease, pay any of the rents due under this Lease or pay any taxes and assessments, or do any other act or thing required of Lessee by the terms of this Lease, or do any act or thing that may be necessary and proper to be done in the observance of the covenants and conditions of this Lease or to prevent the termination of this Lease; provided, however, that the doing of any act or thing requiring possession of the Demised Premises shall be subject to the further rights of Holder as set forth in Section 16.2. All payments so made and all things so done and performed by the Holder shall be effective to prevent a foreclosure of the rights of Lessee thereunder as the same would have been if done and performed by Lessee. ARTICLE 5 TAXES 5.1 Lessee shall be responsible for all real estate taxes levied, taxed or imposed upon the Real Estate that become payable during the term hereof and which would become delinquent if not so paid during the term hereof. Lessee shall further provide to Lessor official receipts of the appropriate taxing authority or other evidence satisfactory to Lessor evidencing payment thereof. 5.2 During the term of this Lease, Lessee further agrees to pay all other taxes, rates, charges, levies and assessments, general and special, of every name, nature and kind, whether now known to the law or hereafter created which may be taxed, charged, assessed, levied or imposed upon said real estate and which become payable during the term hereof and which would become delinquent if not so paid during the term hereof, any buildings or improvements thereon which may be taxed, charged, assessed, levied or imposed upon the leasehold estate hereby created and upon the reversionary estate in said real estate during the term hereof and which become payable during the term hereof 6 and which would become delinquent if not so paid during the term hereof, and all such other taxes, rates, charges, levies and assessments shall be paid by Lessee as they become due and before they become delinquent during the term hereof. 5.3 Lessee agrees to timely pay all taxes, assessments or other public charges levied or assessed by lawful authority (but reasonably preserving Lessee's rights of appeal) against its personal property on the premises, during the term of this Lease. 5.4 Nothing herein shall require Lessee to pay any of Lessor's income taxes, surtaxes, excess profit taxes or any taxes on the rents reserved to Lessor hereunder. 5.5 Lessee shall at all times have the right to contest in good faith, in any proper proceedings, in the name of Lessor if necessary, the payment or satisfaction of any such taxes, assessments, rates, charges or levies so agreed to be paid by Lessee, if the validity thereof, or the right to assess or levy the same against or collect the same from said Demised Premises or Improvements, shall be disputed, but only to the extent permitted under the Minimum Assessment Agreement between Lessor and Lessee with respect to the Demised Premises. Upon the conclusion of any such suit or proceedings, or not less than three (3) months prior to the date when the right to redeem therefrom expires, whichever will be the earlier, Lessee shall promptly pay and satisfy such disputed tax, assessment or other charge as finally determined, together with all expenses, costs and attorneys' fees whatsoever incurred in connection therewith. ARTICLE 6 REPAIRS 6.1 Lessee shall at all times during the term of this Lease, at Lessee's own costs and expense, keep the Demised Premises and the Improvements thereon, and all sidewalks, curbs, and all appurtenances to the Demised Premises, in good order, condition and repair, casualties and ordinary wear and tear excepted. Lessee shall keep and maintain the Demised Premises and all Improvements in a condition consistent with other similarly classed operations. Lessee shall keep the Demised Premises in such condition as may be required by law and by the terms of the insurance policies furnished pursuant to this Lease, whether or not such repair shall be interior or exterior, and whether or not such repair shall be of a structural nature. Upon reasonable notice to Lessee, Lessor may, at its discretion and at its cost, conduct an annual inspection of the Demised Premises to determine Lessee's compliance with this Article 6. The City shall be responsible for all repairs, replacements and maintenance of the Alliant Amphitheater. ARTICLE 7 COMPLIANCE WITFI LAW 7.1 During the term of this Lease, Lessee shall comply with all local, state and federal laws applicable to Lessee's use of the Demised Premises, including but not limited to the Americans with Disabilities Act. 7.2 Lessee shall not commit waste on the Demised Premises except as necessary for its business purposes including the removal or construction of any buildings and Improvements on the Demised Premises, and shall be liable for any damages to or destruction of any buildings or Improvements on the Demised Premises resulting from waste and shall be required to repair or rebuild such buildings or Improvements. Lessee may remove existing Improvements or construct new Improvements on the Demised Premises subject to all of the terms and conditions of this Lease provided Lessee has received the prior approval of Lessor, which approval Lessor shall not unreasonably withhold. ARTICLE 8 ALTERATIONS 8.1 Following construction of the Minimum Improvements, Lessee shall have the right, with Lessor's prior written consent in the event the cost thereof exceeds Fifty Thousand and 00/100 Dollars ($50,000.00) (which consent shall not be unreasonably withheld) from time to time during the term of this Lease and any renewals, to make any alteration, addition or modification to the Demised Premises or the Improvements thereon. Any such alterations, additions or modifications shall be completed consistent with the requirements of any applicable federal, state or local statutes or ordinances. On the 10th anniversary of the commencement of this lease (July 1, 2016) the $50,000 threshold provided above shall be adjusted by multiplying the $50,000 by a fraction, the numerator of which shall be the Consumer Price Index -All Urban Consumers for June 1, 2016 and the denominator which shall be the Consumer Price Index -All Urban Consumers for June 1, 2006. This adjustment to the cost of work requiring Landlord's consent shall be made every 10 years thereafter during the term of this lease and any extensions. In each case, the numerator shall be the above index as of the date of adjustment and the denominator shall be the above index as of the date of the previous adjustment. In the event the United States Government no longer utilizes the index referred to above, the parties shall use a comparable index mutually agreed upon by the parties. In the event the cost of any alternation, addition, or modification is less than $50,000 during the initial 10 years of the lease or less than the threshold adjusted by the above Consumer Price Index adjustment thereafter, then Lessee may make such alteration, additional modification without the prior written consent of Lessor. ARTICLE 9 USE AND MAINTENANCE OF DEMISED PREMISES s 9.1 Lessee shall operate the Improvements for the purposes outlined in the Development Agreement and shall not knowingly use or allow the Demised Premises or any buildings or Improvements thereon or any appurtenances thereto, to be used or occupied for any unlawful purpose or in violation of any certificate of occupancy. Lessee shall not suffer any act to be done or any condition to exist within the Demised Premises or in any Improvement thereon, or permit any article to be brought therein, which is dangerous, unless safeguarded as required by law, or which, in law, constitute a nuisance, public or private, or which may make void or voidable any insurance in force with respect thereto. 9.2 Lessee shall maintain and repair the Improvements in the Demised Premises, at Lessee's sole expense, during the term hereof and any extensions or renewals. ARTICLE 10 INSURANCE 10.1 Lessee shall provide and maintain or cause to be maintained at all times, at its cost and expense, during the process of constructing Improvements (and, from time to time at the request of City, furnish City with proof of payment of premiums on) insurance as follows: (a) Builder's risk insurance as follows: 1. Named Insured: the City of Dubuque, Lessee, the general contractor and any named or unnamed sub- or sub- subcontractors. 2. Covered Property: The Improvements, and the existing Brewery building, including all fixtures, materials, supplies, machinery, and equipment to be used in or incidental to the construction of the Improvements. 3. Covered Perils: All risks of physical loss including collapse, operation of building ordinances or laws, mechanical breakdown, or electrical injury, testing, earthquake, flood, sewer backup, and seepage. 4. Valuation: Replacement cost for the Improvements and on a function basis for the replacement of the existing Brewery building with functionally equivalent but less costly material if available. 5. Coverage Amount: The completed value of the Improvements, including the value of the existing Brewery building. (b) Commercial General Liability insurance as set forth in the City's standard Insurance Schedule for Lessees of City Property, as such uniform, standardized schedule may from time to time be amended. The current Insurance Schedule is attached to this Lease as Insurance Schedule A, Exhibit "B." 10.2 Upon completion of construction of Improvements, Lessee shall maintain, or cause to be maintained at all times, at its cost and expense, (and, from time to time at the request of City, shall furnish proof of the payment of premiums on) insurance as follows: (a) Property insurance against loss and/or damage to Improvements and the existing Brewery building under an insurance policy written on the Special Perils Form in an amount not less than the full insurable replacement value of Improvements and the existing Brewery building, but any such policy may have a deductible amount of not more than $50,000.00. No policy of insurance shall be so written that the proceeds thereof will produce less than the minimum coverage required by the preceding sentence, by reason of co-insurance provisions or otherwise, without the prior consent thereto in writing by City. Replacement value shall be determined from time to time at the request of City, but not more frequently than once every three years, and paid for by Lessee. 1. Named Insured: the City of Dubuque and Lessee. 2. Covered Property: The Improvements, and the existing Brewery building, including all fixtures, materials, supplies, machinery, and equipment to be used in or incidental to the construction of the Improvements. 3. Covered Perils: All risks of physical loss including collapse, operation of building ordinances or laws, mechanical breakdown, or electrical injury, testing, earthquake, flood, sewer backup, and seepage. 4. Valuation: Replacement cost for the Improvements and on a function basis for the replacement of the existing Brewery building with functionally equivalent but less costly material if available. 5. Coverage Amount: The completed value of the Improvements, including the value of the existing Brewery building. io (b) Commercial General Liability insurance as set forth in the City's standard Insurance Schedule for Lessees of City Property, as such uniform, standardized schedule may from time to time be amended. The current Insurance Schedule is attached to this Lease as Insurance Schedule A, Exhibit "B." 10.3 All insurance required by this Article shall be taken out and maintained in responsible insurance companies selected by Lessee which are authorized under the laws of the State of Iowa to assume the risks covered thereby. Lessee shall deposit annually with City copies of policies evidencing all such insurance, or a certificate or certificates or binders of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Section, each policy shall contain a provision that the insurer shall not cancel or modify it without giving written notice to Lessee and City at least thirty (30) days before the cancellation or modification becomes effective. Lessee shall furnish City evidence satisfactory to City that the policy has been renewed or replaced by another policy conforming to the provisions of this Section, or that there is no necessity therefor under the terms hereof. In lieu of separate policies, Lessee may maintain a single policy, or blanket or umbrella policies, or a combination thereof, which provide the total coverage required herein, in which event Lessee shall deposit with City a certificate or certificates of the respective insurers as to the amount of coverage in force upon Improvements, provided, however, the specific limit shall not be impaired. 10.4 Lessee agrees to notify City immediately in the case of damage exceeding $50,000.00 in amount to, or destruction of, Improvements or any portion thereof resulting from fire or other casualty. Net proceeds of any such insurance ("Net Proceeds"), shall be paid directly to Lessee, and Lessee shall forthwith repair, reconstruct and restore the Improvements to substantially the same or an improved condition or value as they existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restoration, Lessee shall apply the Net Proceeds of any insurance relating to such damage received by Lessee to the payment or reimbursement of the costs thereof, subject, however, to the terms of any mortgage encumbering title to the Property. 10.5 Lessee shall complete the repair, reconstruction and restoration of Improvements, whether or not the Net Proceeds of insurance received by Lessee for such purposes are sufficient. 10.6 All rights of Lessor to receive or be paid insurance proceeds hereunder, including but not limited to Section 10.4 above, are in all respects subject and subordinate to the rights of any Holder, which rights are prior to the rights of Lessor. ii ARTICLE 11 LESSOR°S WARRANTIES AND REPRESENTATIONS 11.1 Lessor's Representation of Good Title. Lessor covenants and warrants that Lessor is lawfully seized in possession of the Demised Premises, shall take all necessary steps to acquire fee simple title to the Premises as required by law, and that it has full right and authority to enter into this Lease for the full term hereof, and covenants and agrees that upon paying the rent provided for herein, and upon Lessee's performing the covenants and agreements of this Lease required to be performed by said Lessee, that it will have, hold and enjoy quiet possession of the Demised Premises. Lessor warrants to Lessee that the Demised Premises are properly zoned for the conduct of the operation of Lessee's business. ARTICLE 12 LESSEE'S WARRANTIES AND REPRESENTATION 12.1 Lessee Compliance With Law. (a) Lessee shall comply with all applicable local, state and federal laws, rules, regulations and permits with regard to the Demised Premises and its use, occupancy and control of the Demised Premises. (b) Without limiting the obligations of Lessor under Section 3.2, Lessee shall be responsible for obtaining any and all applicable permits, licenses or authorizations as may be necessary for Lessee's use, occupancy and control of the Demised Premises. 12.2 Environmental Matters. (a) Lessee covenants and agrees that Lessor shall have no responsibility for or liability arising from any release of a Hazardous Substance which is caused by Lessee or its agents or invitees. Notwithstanding any other provision of this Lease, Lessor agrees that Lessee shall not have any responsibility for any Pre-Existing Condition (as defined below) nor shall Lessor seek indemnification from Lessee for any such Pre-Existing Condition. There is a rebuttable presumption that any Hazardous Substances found on the Demised Premises were not deposited by Lessee and are a Pre-Existing Condition. A pre-existing condition ("Pre-Existing Condition") shall be defined as (i) any Hazardous Substances found on the Demised Premises which were not deposited by Lessee or its agents or invitees on the Demised Premises, (ii) any Hazardous Substances on the Demised Premises prior to the Initial Term of this Lease, and (iii) any Hazardous Substances which leach or 12 migrate on to the Demised Premises from any adjoining properties, including properties owned by the Lessor. (b) Notwithstanding any other provision of this Lease, the Lessor, in its capacity as both owner of the Demised Premises as landlord under this Lease, shall retain any legal responsibility or liability, subject to available defenses, the Lessor may have under law for any Pre- Existing Condition. This retained responsibility and duty includes the duty to assess, remove and remediate Pre-Existing Conditions on or affecting the Demised Premises as ordered by a state or federal agency, subject to the availability of a comfort letter. This provision shall not inure to the benefit of third parties and shall not be interpreted to enlarge any liabilities owed by the Lessor or to require the Lessor to absorb any duties, responsibilities or liabilities that it does not already have for the Pre-Existing Conditions. (c) Lessee agrees to provide reasonable notice to the Lessor of any claims by adjoining or affected property owners, third parties, or parties making claims through a citizen action or private right of action under applicable law, environmental statutes or regulations which arise out of or are related to Pre-Existing Conditions on the Demised Premises. Upon receipt of such notice, to the fullest extent allowed by law, the Lessor agrees to defend, hold harmless and indemnify Lessee for costs and expenses associated with responding to any claims by adjoining property owners, third parties, or parties making claims through a citizen action or private right of action under applicable environmental statutes or regulations which arise out of or are directly related to Pre-Existing Conditions on the Demised Premises. (d) To the fullest extent allowed by law, the Lessor agrees to indemnify Lessee for reasonable costs and expenses associated with responding to any legally enforceable order regarding Pre-Existing Conditions from any governmental agency or court with proper jurisdiction to the extent that the Lessor, after Lessee has given reasonable notice of the governmental order to the City, does not timely and reasonably respond to said inquiry or order and if the Lessee allows full access to the Premises as necessary, as provided herein. The Lessor's right of appeal and negotiation are not waived by the foregoing and the filing of an appeal or negotiation with the governmental agency is considered timely and reasonable response. However, the Lessor agrees to indemnify Lessee for any penalties and fines Lessee incurs as a result of any such appeal or negotiation. (e) Lessor shall provide reasonable notice to Lessee prior to 13 requesting access for the purposes set forth above. Lessee agrees to allow the Lessor to have access to and use of the Demised Premises to times and locations which will minimize any disruption and which will not materially or unreasonably interfere with the operation or possession of the Demised Premises as required to respond to any governmental inquiry or order as described above. Except as set out below, the terms of this provision shall not be construed to require that the Lessee is under any obligation to Lessor to move, damage, or modify personal property, fixtures, or buildings on the Demised Premises or to allow Lessor to affect or modify this Lease, whether by lien, easement, or governmental order, except to the extent that use limitations and environmental protection easements may be placed on the Demised Premises which do not change or interfere with the actual or proposed use of the Demised Premises by Lessee. The Lessee agrees that it will not install drinking water wells or otherwise obtain potable water for the purpose of consumption or bodily contact from the groundwater underneath the Demised Premises and agrees to execute any necessary waivers or easements to that effect. If the Lessor is required by a state or federal agency to take such action which materially or unreasonably interferes with the operation or possession of the Demised Premises, or otherwise damages the property of Lessee, then the Lessor shall be required to pay the reasonable costs associated with such activity, including, without limitation, loss of income, economic damages, property damage, and other costs and expenses, whether temporary or permanent in nature, incurred by Lessee by reason of the interference. (f) Lessee covenants and agrees to promptly notify Lessor of any release of Hazardous Substance in, on or about the Demised Premises of which Lessee has actual knowledge. (g) Lessee covenants and agrees to promptly take any and all necessary and appropriate response to address any release of Hazardous Substance for which Lessee is responsible under Section 12.2A. Such response shall include, without limitation, notification to appropriate governmental authorities, as may be required by law. (h) Lessee covenants and agrees to not manufacture, treat or dispose of Hazardous Substances at the Demised Premises or knowingly allow the manufacture, treatment, or disposal of Hazardous Substances same on the Demised Premises. For the purposes of this Lease, "Hazardous Substance" or "Hazardous Substances" means any hazardous or toxic substance, 14 material or waste which is or becomes regulated by any local government, the State of Iowa or the United States Government. It includes, without limitation, any material or substance that is (i) defined as a "hazardous substance" or "hazardous waste" under Chapter 455B, Iowa Code, (ii) petroleum and petroleum products, (iii) asbestos containing materials in any form or condition, (iv) designated as a "hazardous substance" pursuant to Section 311 of the Federal Water Pollution Control Act (33 U.S.C. §1321), (v) defined as a "hazardous waste pursuant to §1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. §6901 et seq., (vi) defined as a "hazardous substance" pursuant to §101 of the Comprehensive Environmental Response, Compensation and Liability Act, U.S.C §9601 et seq., or (vii) defined as a "regulated substance" pursuant to Subchapter IX, Solid Waste Disposal Act (Regulation of Underground Storage Tanks), 42 U.S.C. §6991 et seq.] The term "Hazardous Substance" shall not include any air emissions discharged into the atmosphere as allowed by a duly issued permit from the applicable governmental agency. ARTICLE 13 INDEMNIFICATION 13.1 Indemnification of Lessee. To the extent allowed by law, Lessor will indemnify and save harmless Lessee from and against all liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses (including, without limitation, reasonable attorneys' fees and expenses) imposed upon or incurred by or asserted against Lessee by reason of (a) any accident, injury to or death of persons or loss of or damage to property occurring on or about the Demised Premises and resulting from any act or omission of Lessor, (b) any failure on the part of Lessor to perform or comply with any of the terms of this Lease and (c) any breach on the part of Lessor of any warranty or representation contained in Article 11. In case any action, suit or proceeding is brought against Lessee by reason of such occurrence, Lessor will, at Lessor expense and discretion, either defend such action, suit or proceeding, or cause the same to be defended by counsel approved by Lessee, which approval will not be unreasonably withheld. 13.2 Indemnification of Lessor. To the extent allowed by law, Lessee will indemnify and save harmless Lessor from and against all liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses (including, without limitation, reasonable attorneys' fees and expenses) imposed upon or incurred by or asserted against Lessor by reason of (a) any accident, injury to or death of persons or loss of or damage to property occurring on or about the Demised Premises during the term of this Lease and resulting from any negligence of Lessee or anyone claiming by, through or under Lessee during the term of the Lease and (b) any failure on the part of Lessee to perform or comply is in any material respect with any of the material terms of this Lease, and (c) any material breach on the part of Lessee of any warranty or representation contained in Article 12. In case any action, suit or proceeding is brought against Lessor by reason of such occurrence, Lessee will, at Lessee's expense and discretion, either defend such action, suit or proceeding, or cause the same to be defended by counsel approved by Lessor, which approval will not be unreasonably withheld. 13.3 The obligations and liabilities under this Article shall survive and continue in full force and effect and shall not be terminated, discharged or released, in whole or in part, irrespective of the termination or expiration of the term of this Lease. ARTICLE 14 CONDEMNATION 14.1 Entire Condemnation. If at any time during the term of this Lease all or substantially all of the Demised Premises or the Improvements thereon shall be taken in the exercise of the power of eminent domain by any sovereign, municipality or other public or private authority, then this Lease shall terminate on the date of vesting of title in such taking and any prepaid rent shall be apportioned as of said date. Substantially all of the Demised Premises and the Improvements thereon shall be deemed to have been taken if the remaining portion of the Demised Premises shall not be of sufficient size to permit Lessee, in Lessee's sole discretion, to operate its business thereon in a manner similar to that prior to such taking. 14.2 Allocation of Award. Any award for such taking of all or substantially all of the Demised Premises shall be paid to the parties hereto in accordance with the following: (a) To Lessor, the amount of the award attributable to the underlying land within the Demised Premises only, determined as if this Lease was not in effect at the time of such award; (b) To Lessee, the entire award except that portion allocated to Lessor above. 14.3 Partial Condemnation. If less than all or substantially all of the Demised Premises or the Improvements thereon shall be taken in the exercise of the power of eminent domain by any sovereign, municipality or other public or private authority, then Lessee, at its option, may elect to continue this Lease in full force and effect or terminate this Lease. If Lessee shall elect to maintain this Lease in full force and effect, the award for such partial condemnation shall be allocated as provided in Section 14.2, and Lessee shall proceed with reasonable diligence to carry out any necessary repair and restoration so that the remaining 16 Improvements and appurtenances shall constitute a complete structural unit or units which can be operated on an economically feasible basis under the provisions of this Lease. In the event Lessee elects to continue this Lease in full force and effect after a partial condemnation, the Base Rent shall be reduced in proportion to the area of the Demised Premises taken. Should Lessee elect to terminate this Lease upon a partial condemnation, Lessee shall provide Lessor with written notice of such election within thirty (30) days after the date of vesting of title for such taking. Lessee shall specify in such written notice the date on which this Lease shall terminate, which date shall be not less than 60 days nor more than 360 days after delivery of such notice to Lessor (the Termination Date). In the event Lessee terminates this Lease, as provided for in this Section 13.3, Lessee shall be entitled to the entire award for such partial taking. 14.4 Temporary Taking. If the temporary use of the whole or any part of the Demised Premises or the Improvements thereon or the appurtenances thereto shall be taken at any time during the term of this Lease in the exercise of the power of eminent domain by any sovereign, municipality, or other authority, the term of this Lease shall not be reduced or affected in any way, and Lessee shall continue to pay in full the rent, additional rent and other sum or sums of money and charges herein reserved and provided to be paid by Lessee, and the entire award for such temporary taking shall be paid to Lessee. Lessee shall repair and restore any and all damage to the Demised Premises and the Improvements as soon as reasonably practicable after such temporary taking. ARTICLE 15 ASSIGNMENT AND SUBLETTING 15.1 Assignment of Lease. Prior to the issuance of the Certificate of Completion (as defined in Section 2.4 of the Development Agreement) for the Minimum Improvements, this Lease may not be assigned by Lessee without the prior written consent of the Lessor. After the issuance of the Certificate of Completion, the Lessee shall have the right to transfer and assign this Lease to a third party, subject to the consent of Lessor which consent shall not be unreasonably withheld, provided said third party agrees to comply with the terms and conditions of this Lease. 15.2 Subletting. Lessee shall have the right to enter into subleases related to the Demised Premises under terms acceptable to Lessee, in Lessee's sole discretion. ARTICLE 16 DEFAULT 16.1 Lessor's Rights in the Event of Lessee's Default. If Lessee shall fail i~ or neglect to observe, keep or perform any of the covenants, terms or conditions contained in this Lease on its part to be observed, kept or performed, and the default shall continue for a period of thirty (30) days after written notice from Lessor setting forth the nature of Lessee's default (it being intended that in connection with a default not susceptible of being cured with diligence within thirty (30) days, the time within which Lessee has to cure the same shall be extended for such period as may be necessary to complete the same with all due diligence, but in no event longer than ninety (90) days), then and in any such event, Lessor shall have the right at its option, on written notice to Lessee, to terminate this Lease. Lessor shall thereafter have the right to enter and take possession of the Demised Premises with process of law and to remove all personal property from the Demised Premises and all persons occupying the Demised Premises and to use all necessary force therefor and in all respects to take the actual, full and exclusive possession of the Demised Premises and every part of the Demised Premises as of Lessor's original estate, without incurring any liability to Lessee or to any persons occupying or using the Demised Premises for any damage caused or sustained by reason of such entry on the Demised Premises or the removal of persons or property from the Demised Premises. 16.2 Rights of Holder of Encumbrance in Event Lessee Defaults. If Lessee fails or neglects to observe, keep or perform any of the covenants, terms or conditions contained in this Lease on its part to be observed, kept or performed, the Holder of any indebtedness secured by an encumbrance on the leasehold estate under this Lease shall have thirty (30) days after receipt of written notice from Lessor setting forth the nature of Lessee's default and a reasonable time thereafter if it shall have commenced foreclosure or other appropriate proceedings in the nature thereof within such thirty (30) days and is diligently prosecuting such proceedings, but in no event longer than ninety (90) days, within which to endeavor to make good or remove the default or cause for termination of the Lease. All right of Lessor to terminate this Lease on the failure or neglect of Lessee to observe, keep and perform the covenants, terms and conditions of this Lease is, and shall continue to be, at all times prior to payment in full of the indebtedness to the Holder of Lessee, subject to and conditioned on Lessor's having first given the Holder written notice thereof and the Holder having failed to cause the default or cause for termination to be made good or removed within thirty (30) days after receiving written notice of default or cause for termination or within a reasonable time thereafter if it shall have commenced foreclosure or other appropriate proceedings in the nature of foreclosure within such thirty (30) days and is diligently prosecuting such proceedings, but in no event longer than ninety (90) days. 16.3 Lessee's Rights in the Event of Lessee's Default. If Lessor shall fail or neglect to observe, keep or perform any of the covenants, terms or conditions contained in this Lease on its part to be observed, kept or performed, and the default shall continue for a period of thirty (30) days after written notice from la Lessee setting forth the nature of Lessor's default (it being intended that in connection with a default not susceptible of being cured with diligence within thirty (30) days, the time within which Lessor has to cure the same shall be extended for such period as may be necessary to complete the same with all due diligence, but in no event longer than ninety (90) days), then and in any such event, Lessee shall have all rights available to it provided by law or equity. ARTICLE 17 RIGHT TO CURE OTHER'S DEFAULTS 17.1 Whenever and as often as a party shall fail or neglect to comply with and perform any term, covenant, condition or agreement to be complied with or performed by such party hereunder, then, following thirty (30) days' prior written notice to such defaulting party (or such additional time to cure as may be accorded Lessee pursuant to Section 16.1 above, but in no event longer than ninety (90) days), the other party, at such other party's option, in addition to all other. remedies available to such other party, may perform or cause to be performed such work, labor, services, acts or things, and take such other steps, including entry onto the Demised Premises and the Improvements thereon, as such other party may deem advisable, to comply with and perform any such term, covenant, condition or agreement which is in default, in which event such defaulting party shall reimburse such other party upon demand, and from time to time, for all costs and expenses suffered or incurred by such other party in so complying with or performing such term, covenant, condition or agreement. The commencement of any work or the taking of any other steps or performance of any other act by such other party pursuant to the immediately preceding sentence shall not be deemed to obligate such other party to complete the curing of any term, covenant, condition or agreement which is in default. ARTICLE 18 QUIET ENJOYMENT 18.1 Lessor covenants that at all times during the term of this Lease, so long as Lessee is not in default hereunder, Lessee's quiet enjoyment of the Demised Premises or any part thereof shall not be disturbed by any act of Lessor, or of anyone acting by, through or under Lessor. ARTICLE 19 ESTOPPEL CERTIFICATES 19.1 Each party hereto agrees that at any time and from time to time during the term of this Lease, within ten (10) days after request by the other party hereto or by any lender having an interest in Lessee's leasehold estate, it will execute, acknowledge and deliver to the other party or to such lender or any prospective purchaser, assignee or any mortgagee designated by such other 19 party, a certificate stating (a) that this Lease is unmodified and in force and effect (or if there have been modifications, that this Lease is in force and effect as modified, and identifying the modification agreements), (b) the date to which rent has been paid, (c) whether or not there is any existing default by Lessee in the payment of any rent or other sum of money hereunder, and whether or not there is any other existing default by either party hereto with respect to which a notice of default has been served, and, if there is any such default, specifying the nature and extent thereof; and (d) whether or not there are any setoffs, defenses or counterclaims against enforcement of the obligations to be performed hereunder existing in favor of the party executing such certificate. ARTICLE 20 WAIVER 20.1 No waiver by either party hereto of any breach by the other of any term, covenant, condition or agreement herein and no failure by any party to exercise any right or remedy in respect of any breach hereunder, shall constitute a waiver or relinquishment for the future of any such term, covenant, condition or agreement or of any subsequent breach of any such term, covenant, condition or agreement, nor bar any right or remedy of the other party in respect of any such subsequent breach, nor shall the receipt of any rent, or any portion thereof, by Lessor, operate as a waiver of the rights of Lessor to enforce the payment of any other rent then or thereafter in default, or to terminate this Lease, or to recover the Demised Premises, or to invoke any other appropriate remedy which Lessor may select as herein or by law provided. ARTICLE 21 SURRENDER 21.1 Lessee shall, on the last day of the term of this Lease or upon any termination of this Lease, surrender and deliver up the Demised Premises, with the Improvements then located thereon into the possession and use of Lessor, without fraud or delay and in good order, condition and repair, reasonable wear and tear excepted, free and clear of all lettings and occupancies, free and clear of all liens and encumbrances other than those existing on the date of this Lease and those, if any, created by Lessor, without (except as otherwise provided herein) any payment or allowance whatever by Lessor on account of or for any buildings and Improvements erected or maintained on the Demised Premises at the time of the surrender, or for the contents thereof or appurtenances thereto. Lessee's Trade Fixtures, personal property and other belongings of Lessee or of any sublessee or other occupant of space in the Demised Premises shall be and remain the property of Lessee, and Lessee shall have a reasonable time after the expiration of the term of this Lease (not to exceed thirty (30) days) to remove the same. Zo ARTICLE 22 MEMORANDUM OF LEASE 22.1 Each of the parties hereto will, promptly upon request of the other, execute a memorandum of this Lease in a form suitable for recording setting forth the names of the parties hereto and the term of this Lease, identifying the Demised Premises, and also including such other clauses therein as either party may desire, except the amounts of Basic Rent payable hereunder. ARTICLE 23 NOTICES 23.1 All notices, demands or other writings in this Lease provided to be given or made or sent, or which may be given or made or sent, by either party to the other, shall be deemed to have been fully. given or made or sent when made in writing and deposited in the United States mail, registered and postage prepaid, and by facsimile addressed as follows: TO LESSOR: City of Dubuque, Iowa City Manager City Hall 50 W. 13th Street Dubuque, IA 52001 Fax 563-589-4149 TO LESSEE: Port of Dubuque Brewery Development, LLC 137 Main Street, Suite 400 Dubuque,lA 52001 Fax 563-583-2412 23.2 The address and/or fax number to which any notice, demand or other writing may be given or made or sent to any party as above provided may be changed by written notice given by the party as above provided. ARTICLE 24 VENDOR STATUS City shall require that, with respect to the sale of any food or beverages, including wine, for any event held in the Alliant Amphitheater by any party, that such party shall be required to obtain a bid for the provision of such food from Lessee's subtenants located in the Dubuque Star Brewery Building. It is the intent of this paragraph that Lessee shall have the right to grant or lease to its subtenants the rights granted under the terms of this paragraph (the right to bid for the sale or provision of food or beverages, including wine, for all events in any 21 way associated with the Alliant Amphitheater during the term hereof or any renewals or extensions). Lessee shall have the excusive right to control or grant to others the right to control the offering or selling of food or beverages, including wine, on any property located within Area A on Exhibit A attached hereto. ARTICLE 25 OPTIONS TO RENEW Lessee is hereby granted one option to renew this lease for 10 additional years. The lease shall automatically renew unless Lessee provides a written notice to Lessor at least 180 days prior to termination of the then current term of Lessee's intent not to exercise any such option. Provided, however, at least 180 days prior to termination of the then current term, the parties shall utilize the procedure set forth in paragraph 2.1(d) above to determine the appraised value of the demised premises, provided, however, that for any renewal, the property to be appraised shall include not only the underlying real estate but also the Dubuque Star Brewery building/improvements. At such time as the new appraised value is determined, Lessee shall then have 30 days from the date it receives notice of the new appraised value to provide written notice to Lessor of Lessee's intent to either proceed with its automatic exercise of the right to renew the lease for an additional 10 year term or a written notice to Lessor rescinding the automatic exercise of the option. In the latter event, the Lease shall terminate upon termination of then current term. In the event Lessee reaffirms its intent to exercise its right to renew the lease for an additional 10 year term, this Lease shall continue under the same terms and conditions contained herein except that the annual rental shall be 12% of the new appraised value. The rent, so re-determined, shall remain unchanged during the 10 year renewal term. ARTICLE 26 MISCELLANEOUS 26.1 Time of the Essence. Time is of the essence of this Lease and all of its provisions. 26.2 Governing Law. It is agreed that this Lease shall be governed construed and enforced in accordance with the laws of the State of Iowa. 26.3 Paragraph Headings. The titles to the paragraphs of this Lease are solely for the convenience of the parties and shall not be used to explain, modify, simplify or aid in the interpretation of the provisions of this Lease. 26.4 Modification of Agreement. Any modification of this Lease or additional obligation assumed by either party in connection with this Lease shall be binding only if evidenced in a writing signed by each party or an authorized representative of each party. 22 26.5 Parties Bound. This Lease shall be binding on and shall inure to the benefit of and shall apply to the respective successors and assigns of Lessor and Lessee. All references in this Lease to "Lessor" or "Lessee" shall be deemed to refer to and include successors and assigns of Lessor or Lessee without specific mention of such successors or assigns. 26.6 Force Majeure. In the event that either party hereto shall be delayed or hindered in or prevented from the performance of any act required hereunder by reason of strikes, lockouts, labor troubles, unavailability of construction materials, unavailability or excessive price of fuel, power failure, riots, insurrection, war, terrorist activities, explosions, hazardous conditions, fire, flood, weather or acts of God, or by reason of any other cause beyond the exclusive and reasonable control of -the party delayed in performing work or doing acts required under the terms of this Lease (collectively "Force Majeure"), then performance of such act shall be excused for the period of the delay and the period for the performance of any such act shall be extended for a period equivalent to the period of such delay. 26.7 Conflict. To the extent there is a conflict of terms between the Development Agreement and this Lease, the terms of the Development Agreement shall control. 26.8 Entire Agreement. This Agreement, along with the Development Agreement and Minimum Assessment Agreement, constitutes the entire agreement between the Lessor and the Lessee regarding the lease of the Demised Premises and supersedes all previous oral or written agreements between the parties regarding the subject matter of this Lease. LESSOR: CITY OF DUBUQUE, IOWA LESSEE: PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC By: Roy D. Buol, Mayor By: Waybe Briggs, Managing Member Attest: Jeanne F. Schneider, City Clerk EXHIBIT A LEGAL DESCRIPTION OF DEMISED PREMISES Location in Lot 2 Riverwalk 5th Addition in the City of Dubuque, Iowa EXHIBIT A-1 PLAT 2s FINAL PLAT RIVERWALK 5TH ADDITION IN THE CITY OF DUBUQUE, IOWA EXHIBIT A-1 SITE PLAN 2 STAR BREWERY BUILDING EXHIBIT B INSURANCE SCHEDULE INSURANCE SCHEDULE A INSURANCE REQUIREMENTS FOR TENANTS AND LESSEES OF CITY PROPERTY OR VENDORS (SUPPLIERS, SERVICE PROVIDERS) TO THE CITY OF DUBUQUE 1. All policies of insurance required hereunder shall be with an insurer authorized to do business in Iowa. All insurers shall have a rating of A or better in the current A.M. Best Rating Guide. 2. All policies of insurance shall be endorsed to provide a thirty (30) day advance notice of cancellation to the City of Dubuque, except for 10 day notice for non-payment, if cancellation is prior to the expiration date. This endorsement supersedes the standard cancellation statement on the Certificate of Insurance. 3. shall furnish a signed Certificate of Insurance to the City of Dubuque, Iowa for the coverage required in Paragraph 6 below. Such certificates shall include copies of the following policy endorsements: a) Commercial General Liability policy is primary and non-contributing. b) Commercial General Liability additional insured endorsement. c) Governmental Immunity Endorsements. 4. Each certificate shall be submitted to the contracting department of the City of Dubuque. 5. Failure to provide minimum coverage shall not be deemed a waiver of these requirements by the City of Dubuque. Failure to obtain or maintain the required insurance shall be considered a material breach of this agreement. 6. shall be required to carry the following minimum coverage/limits or greater if required by law or other legal agreement: a) COMMERCIAL GENERAL LIABILITY General Aggregate Limit $2,000,000 Products-Completed Operations Aggregate Limit $1,000,000 Personal and Advertising Injury Limit $1,000,000 Each Occurrence Limit $1,000,000 Fire Damage Limit (any one occurrence) $ 50,000 Medical Payments $ 5,000 This coverage shall be written on an occurrence, not a claims made form. Form CG 25 04 03 97 "Designated Location (s) General Aggregate Limit" shall be included. All deviations or exclusions from the standard ISO commercial general liability form CG 0001, or Business Owners form BP 0002, shall be clearly identified. 30 INSURANCE SCHEDULE A (Continued) INSURANCE REQUIREMENTS FOR TENANTS AND LESSEES OF CITY PROPERTY OR VENDORS (SUPPLIERS, SERVICE PROVIDERS) TO THE CITY OF DUBUQUE Governmental Immunity Endorsement identical or equivalent to form attached. Additional Insured Requirement: The City of Dubuque, including all its elected and appointed officials, all its employees and volunteers, all its boards, commissions and/or authorities and their board members, employees and volunteers shall be named as an additional insured on General Liability Policies using ISO endorsement CG 20 26 0704 "Additional Insured -Designated Person or Organization," or it's equivalent. -See Specimen b) WORKERS' COMPENSATION & EMPLOYERS LIABILITY Statutory for Coverage A Employers Liability: Each Accident Each Employee -Disease Policy Limit -Disease c) UMBRELLA EXCESS LIABILITY LIQUOR OR DRAM SHOP LIABILITY Coverage to be determined on a case by case basis by Finance Director. Completion Checklist ^ Certificate of Liability Insurance (2 pages) ^ Designated Location(s) General Aggregate Limit CG 25 04 03 97 (2 pages) ^ Additional Insured 20 26 07 04 ^ Governmental Immunities Endorsement $100,000 $100,000 $500,000 31 CITY OF DUBUQUE, IOWA COVERNMENTA-L IMMUNITIES ENDORSEMENT Nonwaiver of Governmental Immunity. The insurance carrier expressly agrees and states that the purchase of this policy and the including of the City of Dubuque, Iowa as an Additional Insured does not waive any of the defenses of governmental immunity available to the City of Dubuque, Iowa under Code of Iowa Section 670.4 as it is now exists and as it may be amended from time to time. 2. Claims Coverage. The insurance carrier further agrees that this policy of insurance shall cover only those claims not subject to the defense of governmental immunity under the Code of Iowa Section 670.4 as it now exists and as it may be amended from time to time. Those claims not subject to Code of Iowa Section 670.4 shall be covered by the terms and conditions of this insurance policy. 3. Assertion of Government Immunity. The City of Dubuque, Iowa shall be responsible for asserting any defense of governmental immunity, and may do so at any time and shall do so upon the timely written request of the insurance carrier. 4. Non-Denial of Coverage. The insurance carrier shall not deny coverage under this policy and the insurance carrier shall not deny any of the rights and benefits accruing to the City of Dubuque, Iowa under this policy for reasons of governmental immunity unless and until a court of competent jurisdiction has ruled in favor of the defense(s) of governmental immunity asserted by the City of Dubuque, Iowa. No Other Change in Policy. The above preservation of governmental immunities shall not otherwise change or alter the coverage available under the policy. SPECIMEN ADDITIONAL INSURED - DESIGNATED PERSON OR ORGANIZATION ACCORD CERTIFICATE OF LIABILITY INSURANCE IMPORTANT DISCLAIMER SPECIMEN DESIGNED LOCATION(S) GENERAL AGGREGATE LIMIT SPECIMEN SPECIMEN SPECIMEN DEVELOPMENT AGREEMENT BETWEEN THE CITY OF DUBUQUE AND PORT OF DUBUQUE BREWERT DEVELOPMENT, LLC This DEVELOPMENT AGREEMENT (the Agreement) made on or as of the 17th day of July, 2006 (the Effective Date), by and between the City of Dubu , Iowa 'municipality (City), established pursuant to Iowa law and acting under authorization of Iowa Code Chapter 403, as amended (the Urban Renewal Act) and Port of Dubuque Brewery Development, LLC, an Iowa Limited Liability Company (Developer). 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 Greater Downtown Urban Renewal District (the Project Area); and WHEREAS, as of the Effective Date of this Agreement there has been prepared and approved by City an Urban Renewal Plan for the Project Area consisting of the Greater Downtown Urban Renewal Plan approved by City Council of City on the 19th of April, 2004, attached hereto as Exhibit "A," (the Urban Renewal Plan); and WHEREAS, a copy of the Urban Renewal Plan, as constituted on the Effective Date of this Agreement, has been recorded in the office of the Recorder of Dubuque County, Iowa; and WHEREAS, Developer has requested that City lease to Developer certain real property and improvements, commonly known as the Dubuque Star Brewery Building and Site, including non-exclusive use of the Alliant Amphitheater and additional use rights as set forth in paragraph 3.6, located in the City of Dubuque, Dubuque County, Iowa (the Property), legally described in Exhibit "B," attached hereto and incorporated herein by reference, so that Developer may redevelop the Property, located in the Project Area, for and in accordance with the uses specified in the Urban Renewal Plan and in accordance with this Agreement. Developer shall have exclusive use of Area A and exclusive use of Area B, both as depicted on Exhibit C attached hereto and by this reference made a part hereof; and WHEREAS, City believes that the redevelopment 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, and does not conflict with any term, covenant or condition of the Urban Renewal Plan. NOW THEREFORE, in consideration of the promises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: SECTION 1. LEASE OF PROPERTY TO DEVELOPER 1.1 Lease. On the Closing Date, City shall transfer possession of the Property pursuant to a lease with the Developer (the Lease) for a term of fifty (50) years. Tenant shall have the right to extend the lease for one additional 10 year term based upon the terms and conditions contained in paragraph 25 of the Lease. The Lease shall be in the form of Exhibit "D" attached hereto. 1.2 Recordation of Lease. Developer shall promptly record a Memorandum of Lease as stipulated in the Lease in the office of the Recorder of Dubuque County, Iowa. Developer shall pay all the costs for so recording. 1.3 Condition of Property. City shall deliver the Property in its "as is" condition. 1.4 Representations of City. In order to induce Developer to enter into this Agreement, City hereby represents and warrants to Developer that by the Closing Date and to the best of City's knowledge: (1) City is the owner of the Property in fee simple subject to no liens or encumbrances. (2) City has duly obtained all necessary approvals and consents for its execution, delivery and performance of this Agreement and the Lease, and that it has full power and authority to execute, deliver and perform its obligations under this Agreement and the Lease. 1.5 Conditions to Closing. 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 contingencies: (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. (2) Developer shall have obtained any and all necessary governmental approvals, including without limitation approval of zoning, subdivision or platting, and of the Construction Plans pursuant to Section 2.2 below that are necessary or desirable in connection with the Lease and development of the Property. Any conditions imposed as a part of the zoning, platting, subdivision or plan approval must be satisfactory to Developer, in its sole discretion. City shall cooperate with Developer in attempting to 2 obtain any such approvals, provided that City shall bear no expense in connection therewith. (3) Developer and City shall be in compliance with all the material terms and provisions of this Agreement. (4) City shall have received an opinion of counsel in the form attached hereto as Exhibit "E." (5) Developer shall have furnished City with evidence, in a form satisfactory to the City as City shall determine in the reasonable exercise of its discretion (such as a letter of commitment from a bank or other lending institution), that Developer has firm debt and/or equity commitments sufficient in amount to complete construction of the Minimum Improvements (as defined herein) to the Property in conformance with Construction Plans (as defined herein), or City shall have received such other evidence of Developer's financial ability as in the reasonable judgment of City is required to complete such construction. (6) Developer and the City shall have entered into the Lease, in the form attached hereto as Exhibit "D". (7) Developer shall have received, reviewed and approved an abstract of title, provided at City's expense. In the event Developer objects to any matters revealed by such examination that are attributable to matters shown in the abstract of title, such objection shall be delivered to City not later than thirty (30) days after receipt by Developer of the abstract of title. City shall have a period of time equal to twenty (20) days after receipt of Developer's notice to correct Developer's objection to title, and if it shall fail to do so within said twenty (20) day period of time, then Developer shall, by written notice given to City on or before seven (7) days after expiration of the aforementioned twenty (20) day time period, notify City that (i) it has elected to declare this Agreement null, void and of no further effect, in which event neither party shall have any further liability hereunder; or (ii) it has elected to proceed to closing notwithstanding the objection. The Lease shall be subject to all matters revealed by the abstract except those matters which are objected to by Developer and corrected by City, or objected to by Developer and subsequently waived by Developer as provided for herein. (8) City shall have provided Developer with a copy of all current surveys of the Property that are in City's possession. (9) City and Developer shall have executed all documents that the parties deem necessary or required in connection with the Financial Assistance, as that term is defined below. 1.6 Closin The closing shall take place on or before July 3, 2006 (the Closing Date), or such other date as the parties may agree in writing. Exclusive possession of the Property shall be delivered to Developer on the Closing Date in its current condition 3 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 have been satisfied or waived. 1.7 Closing Costs. The following costs and expenses shall be paid on or prior to the Closing Date: (1) City shall pay: (a) The transfer fee imposed on the conveyance, if any. (b) All special assessments whether levied, pending or assessed. (c) City's attorney's fees. (d) The cost of preparing and providing to Developer an abstract of title to the Property. City agrees that the abstract of title shall be provided no later than thirty (30) days prior to the Closing Date. (2) Developer shall pay: (a) The recording fee necessary to record the Memorandum of Lease. (b) Developer's attorney's fees. (c) Developer's broker and/or real estate commissions and fees, if any. 1.8 Real Estate Taxes. Developer shall pay all real estate taxes pursuant to the Lease Agreement. 1.9 No Other Exemptions. The Developer agrees not to apply for any other State or local property tax exemptions which are available with respect to the 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 Chapters 404 and 427 of the Code of Iowa, as amended. SECTION 2. REDEVELOPMENT ACTIVITIES 2.1 Required Minimum Improvements. Developer hereby agrees to rehabilitate the Property into amixed-use commercial/entertainment complex at a total project cost of not less than $6,500,000 which shall include the improvements described in Exhibit F, attached hereto and incorporated herein by reference (the Minimum Improvements). The Minimum Improvements shall meet the Secretary of the Interior's Standards for Rehabilitation and Guidelines for Rehabilitating Historic Buildings. The design of the Minimum Improvements shall be compatible with the pedestrian orientation of adjoining 4 streets, Alliant Plaza and Riverwalk improvements, providing accommodation for public accessibility to these public rights of way and the adjacent Grand River Center (the Conference Center) via a public access easement through the common areas of the Property without damaging or reconfiguring the same, including the Star Brewery Building itself as deemed necessary by City, and specifically with the Port of Dubuque Design Standards. The public access easement shall be located and configured in a manner reasonably acceptable to Developer. The public access easement shall be specifically identified, including its location, dimensions and configuration on a plat or drawing which shall be subject to Developer's prior approval. Developer shall develop, construct and pay for a parking lot adjacent to the Dubuque Star Brewery building, which parking lot shall be located in that area created by the City's relocation of Shot Tower Drive as referred to in paragraph 3.6 hereof and referred to as Area B on Exhibit C (the "Parking Lot"). Developer shall be responsible for snow removal and similar maintenance with respect to the Parking Lot and shall further be responsible for any other maintenance, repair or replacement to the surface of the Parking Lot. Developer shall have the exclusive use of the Parking Lot and all areas within Area A on Exhibit C. Developer shall have the right to assign all or portions of such use to others, including Developer's sublessees with respect to the Dubuque Star Brewery Building. Tenant's obligations with respect to the Parking Lot and its exclusive rights with respect to the Parking Lot shall continue during the term of the Lease referred to in paragraph 1.1 or any renewals thereof. Developer shall not be required to pay any additional sums related to the exclusive use of the Parking Lot beyond the rent provided in the Lease. 2.2 Plans for Construction of Minimum Improvements. Plans and specifications with respect to the construction of the initial Minimum Improvements (the Construction Plans) shall be approved by City provided they are in conformity with the Urban Renewal Plan, which incorporates the Port of Dubuque Master Plan Design Standards, this Agreement, and all applicable state and local laws and regulations. Those improvements relate specifically to the Stone Cliff Winery space and general improvements such as bathrooms, elevators, stair towers, etc. The parties agree and acknowledge that specific improvements which will constitute a portion of the Minimum Improvements with respect to specific tenants will not be determined until such time as leases have been signed with those tenants. To that end, Developer shall, not later than thirty (30) days prior to the Closing Date, submit to City, for approval by City, the Construction Plans and such additional documents as City may reasonably request with respect to the Minimum Improvements to be constructed by Developer on the Property. All work with respect to the Minimum Improvements shall be in conformity with the Construction Plans as approved by City and shall be coordinated with City improvements in the general vicinity of the Property, including, but not limited to, Alliant Plaza, Riverwalk, the Conference .Center and street and utility improvements. It is agreed that approval of the Construction Plans by City is a condition to closing under Section 1.5(3) above, and unless such approval shall be given by City on or before the Closing Date, this Agreement shall be null and void. 5 2.3 Timing of Improvements. Developer hereby agrees that construction of the Minimum Improvements on the Property shall be commenced within sixty (60) days after the Closing Date, and shall be substantially completed within sixty (60) months after the commencement of construction. Provided, however, Developer shall complete 35% of the Minimum Improvements within 24 months after commencement of construction. The time for performance of such obligations shall be suspended during the period of any delays caused by acts of God or other matters not within the control of Developer including, but not limited to, extreme weather conditions and/or other natural causes, casualty, labor problems (including, but not limited to, strikes, walk-outs, picketings, boycotts and shutdowns), governmental restriction upon the availability or use of labor or materials, or insurrection, embargoes, or delays in providing necessary consents or approvals unless otherwise agreed upon in writing by City and Developer. The time for performance of such obligations shall be extended only for the period of such delay. 2.4 Certificate of Completion. Promptly upon completion of the Minimum Improvements in accordance with those provisions of this Agreement relating solely to the obligations of Developer to construct the Minimum Improvements, including the dates for beginning and completion thereof, City shall furnish Developer with an appropriate instrument so certifying. Such certification shall be a conclusive determination of the satisfaction and termination of the agreements and covenants in this Agreement and in the Lease with respect to the obligations of Developer to construct the Minimum Improvements. SECTION 3. CITY PARTICIPATION 3.1 Assistance of City. For and in consideration of Developer's obligations hereunder to construct the Minimum Improvements, City agrees to provide to Developer the financial assistance described herein (the "Financial Assistance"). 3.2 Lease Terms. For and in consideration of Developer's obligations hereunder to construct the Minimum Improvements, City agrees to lease the Property to Developer pursuant to the terms of the Lease. 3.3 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 Act, 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 the 1St day of November, 2009 and continuing until the 1St day of May, 2020, 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 6 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"). Developer recognizes and agrees that the Economic Development Grants shall be paid solely and only from the incremental taxes collected by City in respect to the Minimum Improvements, which does not include property taxes collected for the payment of bonds and interest of each taxing district, and taxes for the regular and voter-approved physical plant and equipment levy, and any other portion required to be excluded by Iowa law, and thus such incremental taxes will not include all amounts paid by Developer as regular property taxes. (2) To fund the Economic Development Grants, City shall certify to the County prior to December 1 of each year, commencing the 1St day of December, 2007, 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, 2007, the Economic Development Grants in respect thereof would be paid to the Developer on November 1, 2008, and May 1, 2009. (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 "Star Brewery 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 Star Brewery TIF Account to pay the Economic Development Grants, as and to the extend set forth in Section 3.3(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 any one 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 Star Brewery 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 3.3 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. 3.4 Intentionally Left Blank. 3.5 Intentionally Left Blank. 7 3.6 City Improvements/Amphitheater/Additional Use Rights. City further agrees to relocate Shot Tower Drive, also known as 4th Street, and to allow public parking at the parking lot adjacent to the McGraw-Hill office building after 6:00 p.m. and on weekends and holidays. City grants to Developer the non-exclusive right to use the Alliant Amphitheater in association with any events or business activities of Developer or any tenant or licensee of Developer at the Leased Premises as defined in the Lease. On or before the Closing Date, City shall develop a scheduling reservation system with respect to use of the Alliant Amphitheater to ensure no conflicts in use of the Alliant Amphitheater. 3.7 Vendor Status. City shall require that, with respect to the sale of any food or beverages, including wine, for any event held in the Alliant Amphitheater by any party, that such party shall be required to obtain a bid for the provision of such food or beverages, including wine, from Developer's subtenants located in the Dubuque Star Brewery Building. It is the intent of this paragraph that Developer shall have the right to grant to its subtenants the rights granted under the terms of this paragraph (the right to bid for the sale or provision of food or beverages, including wine, for all events in any way associated with the Alliant Amphitheater during the term hereof or any renewals or extensions). Developer shall have the excusive right to control or grant or lease to others the right to control the offering or selling of food or beverages, including wine, on any property located within Area A on Exhibit C attached hereto. SECTION 4. COVENANTS OF DEVELOPER 4.1 Insurance Coverages. Developer shall obtain and maintain insurance as set forth in the Lease. 4.2 Non-Discrimination. In carrying out the project, Developer shall not discriminate against any employee or applicant for employment because of race, religion, color, sex, sexual orientation, national origin, age or disability. 4.3 Conflict of Interest. Developer agrees that no member, officer or employee of City, or its designees or agents, nor any consultant or member of the governing body of City, and no other public official of City who exercises or has exercised any functions or responsibilities with respect to the Project during his or her tenure, or who is in a position to participate in adecision-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. 4.4 Non-transferability. This Agreement may not be assigned by Developer without the prior written consent of City, which consent shall not be unreasonably withheld. Transfer or assignment of the Lease shall be governed by the terms thereof. 8 SECTION 5. INDEMNIFICATION 5.1. Developer's Indemnification of City. (1) Developer releases City and its governing body members, officers, agents, servants and employees thereof (hereinafter, for purposes of this Section 5, the "Indemnified Parties") from and 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 Property and the Minimum Improvements. (2) Except for any willful misrepresentation or any willful or wanton misconduct or any unlawful act of the Indemnified Parties, Developer agrees to protect and defend the Indemnified Parties, now or forever, and further agrees to hold the Indemnified Parties harmless, from any claim, demand, suit, action or other proceedings whatsoever by any person or entity whatsoever arising or purportedly arising from (i) any violation of any agreement or condition of this Agreement, except with respect to any suit, action, demand or other proceeding brought by Developer against City to enforce its rights under this Agreement or (ii) the construction, installation, ownership and operation of the Minimum Improvements or (iii) the condition of the Property and any hazardous substance or environmental contamination located in or on the Property which is caused by Developer after Developer takes possession of the Property. (3) The Indemnified Parties shall not be liable for any damage or injury to the persons or property of Developer or its officers, agents, servants or employees or any other person who may be about the Property or the Minimum Improvements other than any act of negligence on the part of any such Indemnified Parties. (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 5A shall survive the termination of this Agreement. 5.2 City's Indemnification of Developer. (1) City releases Developer and its owners, officers, agents, servants and employees (hereinafter, for purposes of this Section 5, also referred to as the "Indemnified Parties") from and covenants and agrees that Indemnified Parties under this paragraph 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 Property 9 prior to the Closing Date, or any loss, damage or expense associated with any environmental condition existing at the Property as of the Closing Date. (2) Except for any willful misrepresentation or any willful or wanton misconduct or any unlawful act of Developer or its owners, officers, agents, servants and employees, City agrees to protect and defend Developer or its owners, officers, agents, servants and employees, now or forever, and further agrees to hold the Developer and its owners, officers, agents, servants and employees harmless from any claim, demand, suit, action or other proceedings whatsoever by any person or entity whatsoever arising or purportedly arising from (i) any violation of any agreement or condition of this agreement by City, except with respect to any suit, action, demand or other proceeding brought by City against Developer to enforce its rights under this agreement; or (ii) negligence of the City or (iii) the condition of the Property as of the Closing Date and any hazardous substance or environmental contamination located in or on the Property which is or was caused by City at any time. (3) The Indemnified Parties shall not be liable for any damage or injury to the persons or property of City or its governing body members, officers, agents, servants and employees or any other person who may be about the property or the Minimum Improvements other than any act of negligence on the part of any such Indemnified Parties. (4) All covenants, stipulations, promises, agreements and obligations of Developer contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of Developer and not of any owner, officer, agent, servant or employee of Developer in the individual capacity thereof. (5) The provisions of this Section 5B shall survive the termination of this agreement. SECTION 6. EVENTS OF DEFAULT AND REMEDIES 6.1 Events of Default Defined. The following shall be Events of Default under this Agreement and Event of Default shall mean, whenever it is used in this Agreement, any one or more of the following events: (1) Any event of default by Developer under the Lease. (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) Failure by Developer to cause the Minimum Improvements to be reconstructed when required pursuant to the Lease. 10 (4) Transfer of any interest by Developer of the Minimum Improvements in violation of the provisions of this Agreement. (5) Failure by Developer to substantially observe or perform any other covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement or the Lease. (6) Developer shall: (a) file any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act of 1978, as amended, or under any similar federal or state law; (b) make an assignment for the benefit of its creditors; (c) admit in writing its inability to pay its debts generally as they become due; or (d) be adjudicated a bankrupt or insolvent: or if a petition or answer proposing the adjudication of Developer as a bankrupt or its reorganization under any present or future federal bankruptcy act or any similar federal or state law shall be filed in any court and such petition or answer shall not be discharged or denied within ninety (90) days after the filing thereof, or a receiver, trustee or liquidator of Developer or of Minimum Improvements, or part. thereof, shall be appointed in any proceedings brought against Developer, and shall not be discharged within ninety (90) days after such appointment, or if Developer shall consent to or acquiesce in such appointment. 6.2 Notice of Default. City shall issue a written notice of default providing therein a thirty (30) day period in which Developer shall have an opportunity to cure such default. In the event the default is of a nature that cannot be cured within the aforementioned thirty (30) day time period, then Developer shall be deemed to be curing the default if Developer, within thirty (30) days after receipt of notice thereof, commences action to cure the default and prosecutes the same to completion, such that the default is cured within a reasonable time under all of the facts and circumstances then existing. 6.3 Remedies Upon Default. If the default remains unremedied after such thirty (30) day period, City shall have the right to do one or more of the following: (1) exercise any remedy provided by law; (2) suspend City's performance under this Agreement; (3) terminate this Agreement and the Lease; 11 (4) withhold certification of completion with respect to the Minimum Improvements; (5) require repayment of all Financial Assistance provided to the Developer, and/or the payment of damages by Developer for any costs incurred by City in connection with the default; and (6) take such action as may be necessary to remove Developer from the Property. 6.4 No Implied Waiver. In the event any term, covenant or condition contained in this Agreement is breached by any party and thereafter waived by any other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. SECTION 7. GENERAL TERMS AND PROVISIONS 7.1 Notices and Demands. Whenever this Agreement requires or permits any notice or written request by one party to another, it shall be in writing, enclosed in an envelope, addressed to the party to be notified, properly stamped, sealed and deposited in the United States Mail, and (1) in the case of Developer, is addressed to Epic Construction, Inc., 137 Main Street, Suite 500, Dubuque, IA 52001; or (2) in the case of City, is addressed to the City Manager, City Hall, 50 W. 13th Street, Dubuque, IA 52001; or at such other address with respect to either party as that party may, from time to time designate in writing and forward to the other as provided in this Section. Any notice delivered hereunder shall be deemed delivered upon the earlier of the actual receipt or two (2) business days after posting. 7.2 Compliance with Laws and Regulations. Developer shall comply with all applicable City, state and federal laws, rules, ordinances, regulations and orders. 7.3 Binding Effect. This Agreement shall be binding upon and shall inure to the benefit of City and Developer and their respective successors and assigns. 7.4 Termination Date. This Agreement and the rights and obligations of the parties hereunder shall terminate upon termination of the Assessment Agreement (the Termination Date). 12 7.5 Execution By Facsimile. The parties agree that this Agreement may be transmitted between them by facsimile. The parties intend that 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. 7.6 Memorandum of Development Agreement. Developer shall promptly record a Memorandum of Development Agreement in the form attached hereto as Exhibit G in the office of the Recorder of Dubuque County, Iowa. Developer shall pay the costs for so recording. CITY OF DUBUQUE, IOWA By: Roy D. Buol, Mayor By: Jeanne F. Schneider, City Clerk PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC By: Wayne Briggs, Managing Member EXHIBIT A URBAN RENEWAL PLAN 14 , /-u4N/PJ ' ' '7 ~~/A/ Prepared by: Barry A. Lindahl 300 Main Street Dubuque IA 52001563583-4113 OFFICIAL NOTICE RESOLUTION NO. 215 - 06 RESOLUTION (1) APPROVING THE MINIMUM REQUIREMENTS, COMPETITIVE CRITERIA, AND OFFERING PROCEDURES FOR THE DEVELOPMENT AND THE LEASE OF CERTAIN REAL PROPERTY AND IMPROVEMENTS IN THE GREATER DOWNTOWN URBAN RENEWAL DISTRICT; (2) DETERMINING THAT THE DEVELOPMENT AGREEMENT AND LEASE SUBMITTED BY PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC SATISFIES THE OFFERING REQUIREMENTS WITH RESPECT TO THE REAL PROPERTY AND IMPROVEMENTS AND DECLARING THE INTENT OF THE CITY COUNCIL TO APPROVE THE DEVELOPMENT AGREEMENT AND THE LEASE WITH PORT OF DUBUQUE BREWERY DEVELOPMENT, LLC IN THE EVENT THAT NO COMPETING PROPOSALS ARE SUBMITTED; AND (3) SOLICITING COMPETING PROPOSALS. Whereas, the City Council of Dubuque, Iowa, did on April 19, 2004 adopt an Amended and Restated Urban Renewal Plan for the Greater Downtown Urban Renewal District ("the Plan") for the Urban Renewal Area described therein; and Whereas, the Plan provides, among other things, for the disposition of properties for private development purposes as a proposed economic development action; and Whereas, Port of Dubuque Brewery Development, LLC ("Developer") has submitted to the City a Development Agreement with a proposal for the leasing of certain real property and improvements hereinafter described for the operation and management of the former Dubuque Star Brewery constructed as described therein ("the Development Agreement and Lease"), together with the request that this property be made available for lease as rapidly as possible; and Whereas, in order to establish reasonably competitive bidding procedures for the disposition of the property in accordance with the statutory requirements of Iowa Code Chapter 403, specifically, Section 403.8, and to assure that the City extends a full and fair opportunity to all developers interested in submitting a proposal, a summary of submission 1 requirements and minimum requirements and competitive criteria for the property offering is included herein; and Whereas, said Developer has tendered the Development Agreement and the Lease with the City, attached hereto as Exhibit "A"; and Whereas, to recognize both the firm proposal for lease of the real property and improvements already received by the City, as described above, and to give full and fair opportunity to other developers interested in submitting a proposal for the use of the property, this Council should by this Resolution: 1) Set the fair market value of the real property for uses in accordance with the Plan; 2) Approve the minimum requirements and competitive criteria included herein; 3) Approve as to form the Development Agreement and the Lease attached hereto as Exhibit "A"; 4) Set a date for receipt of competing proposals and the opening thereof; 5) Declare that the proposal submitted by Developer satisfies the minimum requirements of the offering, and that in the event no other qualified proposal is timely submitted, that the City Council intends to approve such proposal and authorize the City Manager to sign the Development Agreement and the Lease; and direct publication of notice of said intent; 6) Approve and direct publication of a notice to advise any other person of the opportunity to compete for lease of the real property and improvements on the terms and conditions set forth herein; and 7) Declare that in the event another qualified proposal is timely submitted and accepted, another and future notice will be published on the intent ofthe City to enter into the resulting contract, as required by law; and Whereas, the City Council believes it is in the best interest of the City and the Plan to act as expeditiously as possible to lease the real property and improvements as set forth herein. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. That the real property and improvements described in Exhibit "B" attached hereto located in the Port of Dubuque and delineated generally by Pine Drive on 2 the south, Bell Street on the west, the Alliant outdoor amphitheater on the east and the Shot Tower Drive on the north ("the Brewery Property") shall be offered for lease in accordance with the terms and conditions contained in this Resolution. Section 2. for selection, any requirements: That it is hereby determined that in order to qualify for consideration person must submit a proposal which meets these minimum a) Contains an agreement to lease the Brewery Property at not less than fair market value established herein; b) Contains a commitment to lease the Brewery Property for uses allowed in the Port of Dubuque; c) Sets out or provides to the satisfaction of the City Council the experience of the principals and key staff who are directly engaged in performance of contract obligations in carrying out projects of similar scale and character; and d) Meets, at a minimum, the terms and conditions of the Development Agreement and the Lease submitted by the Developer including an agreement to rehabilitate the Brewery Property into a mixed-use commercial/entertainment complex at a total project cost of not less than $6,500,000 and develop, construct and pay for a parking lot adjacent to the Dubuque Star Brewery building. Section 3. That the Development Agreement and the Lease by and between the City and the Developer be and is hereby approved as to form for the purposes hereinafter stated. Section 4. That for the purpose of defining the offering of the Brewery Property for lease, said Development Agreement and Lease shall be deemed to be illustrative of the terms acceptable to the City with respect to: a) Annual lease payments; b) Construction of leasehold improvements; c) City participation; d) Developer obligations; and e) General terms and conditions Section 5. That the Development Agreement and the Lease submitted by the 3 Developer satisfies the requirements of the offering and, in the event that no other qualified proposals are timely submitted that the City Council intends to accept and approve the Lease. Section 6. That it is hereby determined that the Developer possesses the qualifications, financial resources and legal ability necessary to lease the Brewery Property and to manage and operate the Brewery Property in the manner proposed by this offering in accordance with the Plan. Section 7. That the annual lease payments for the Brewery Property offered by the Developer are hereby found and determined to be the fair market value of the leasehold interest being conveyed. Section 8. That the City Clerk shall receive and retain for public examination the attached Development Agreementand Lease submitted by the Developer and, in the event no other qualified proposals are timely submitted, shall resubmit the Development Ageement and the Lease to the City Council for final approval and execution upon expiration of the notice hereinafter prescribed. Section 9. That the action of the City Council be considered to be and does hereby constitute notice to all concerned of the intention of this Council, in the event that no other qualified proposals are timely submitted, to accept the proposal of the Developer to lease the Brewery Property and to approve the Development Agreement and the Lease by and between City and Developer. Section 10. That the official notice of this offering and of the intent of the City, in the event no other qualified proposals are timely submitted, to approve the Development Agreement and the Lease, shall be a true copy of this Resolution, but without the attachments referred to herein. Section 11. That the City Clerk is authorized and directed to secure immediate publication of said official notice in the Teleoraph Herald, a newspaper having a general circulation in the community, by publication of the text of this Resolution without attachments on or before the 7th day of June, 2006. Section 12. That written proposals for the lease of the Brewery Property will be received by the City Clerk at or before 10:00 a.m., July 10, 2006 in the Office of the City Clerk, located on the first floor at City Hall, Dubuque, Iowa 52001. Each proposal will be opened at the hour of 10:00 a.m. in City Hall, Dubuque, Iowa on July 10, 2006. Said proposals will then be presented to the City Council at 6:30 p.m., July 17, 2006, at a meeting to be held in the Auditorium ofthe Carnegie-Stout Public Library, Dubuque, Iowa. Section 13. That such offering shall be in substantial conformance with the provisions of Iowa Code Section 403.8, requiring reasonable competitive bidding procedures as are hereby prescribed, which method is hereby determined to be the appropriate method for making the Brewery Property available for lease. 4 Section 14. That the required documents for the submission of a proposal shall be in substantial conformity with the provisions of this Resolution. Section 15. That the City Clerk is hereby nominated and appointed as the agent of the City of Dubuque, Iowa to receive proposals for the lease of the Brewery Property at the date and according to the procedure hereinabove specified for receipt of such proposals and to proceed at such time to formally acknowledge receipt of each of such proposals by noting the receipt of same in the Minutes of the Council; that the City Manager is hereby authorized and directed to make preliminary analysis of each such proposal for compliance with the minimum requirements established by this Council hereinabove. For each proposal that satisfies these requirements, the City Council shall judge the strength of the proposal by the competitive criteria established hereinabove. The City Council shall then make the final evaluation and selection of the proposals. Section 16. That in the event another qualified proposal is timely submitted and accepted by the City, another and further notice shall be published of the intent of the City of Dubuque, Iowa, to enter into the resulting agreement, as required by law. Passed, approved and adopted this 5th day of June, 2006. t0L~' Ann E. Michalski, Mayor PrO-Tern Attest: ~~J2J Jeanne F. Schneider City Clerk 5 Doc ID: 010932640002 Type: GEN Kind: AGREEMENT Recorded: 03/29/2022 at 11:52:26 AM Fee Amt: $12.00 Page 1 of 2 Dubuque County Iowa John Murphy Recorder File2022-00004030 Prepared by: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 Return to: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 MEMORANDUM OF DEVELOPMENT AGREEMENT AND LEASE AGREEMENT A Development Agreement by and among the City of Dubuque, Iowa, an Iowa municipal corporation, of Dubuque, Iowa, and Port of Dubuque Brewery Development, LLC for the real estate located in Lot 2 Riverwalk 5th Addition in the City of Dubuque, Iowa, according to the recorded plat thereof. The Development Agreement is dated for reference purposes the 16T" day of July, 2006, and contains covenants, conditions, and restrictions concerning the use of said premises. The Lease Agreement is dated the 1st day of July 2006. This Memorandum of Development Agreement and Lease Agreement is recorded for the purpose of constructive notice. In the event of any conflict between the provisions of this Memorandum and the Development Agreement or Lease Agreement, executed by the parties, the terms and provisions of the Development Agreement or Lease Agreement shall prevail. A complete counterpart of the Development Agreement and Lease Agreement, together with any amendments thereto, is in the possession of the City of Dubuque and may be examined at its offices as above provided. Dated this gAay of 022. CITY OF DUBUQUE, IOWA d D�Q City Clerk �'��' 1( 134y A. Lindahl, Esq., Senior Counsel STATE -OF IOWA : ss: DUBUQUE COUNTY On this day of ��r�h , 2022, before me, a Notary Public in and for the State of Iowa, in and for said county, personally appeared Barry A. Lindahl, , to me personally known, who being by me duly sworn did say that he is Senior Counsel of the City of Dubuque, a Municipal Corporation, created and existing under the laws of the State of Iowa and that said instrument was signed on behalf of said Municipal corporation by authority and resolution of its City Council and said Senior Counsel acknowledged said instrument to be the free act and deed of said Municipal Corporation by it voluntarily executed. ti =1 LYN RDINGER r- Commbalm Number 832108 n Expires Nota ublic, State of Iowa �cw*