TriState Quality Metals_IEDA Economic Development Assistance ContractMasterpiece on the Mississippi
Dubuque
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AI- America City
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2007 • 2012 • 2013
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: State of Iowa Economic Development Assistance Contract for TriState
Quality Metals, LLC
DATE: December 10, 2013
Economic Development Director Maurice Jones recommends City Council approval of
the submission of an Economic Development Assistance Contract by TriState Quality
Metals, LLC, the City of Dubuque and the Iowa Economic Development Authority.
The Economic Development Assistance Contract will solidify financial assistance from
the Iowa Economic Development Authority for TriState Quality Metals. The company is
eligible for an investment tax credit worth up to $74,400, and a sales and use tax rebate
of up to $72,000 for the construction of the new facility. The incentives are offered
through the State's High Quality Jobs Program and require a minimum capital
investment of $3,730,000. TriState Quality Metals must also create a minimum of 10
jobs associated with the project. The local match for the project will be the 10 -year tax
increment rebate, valued at approximately $580,000.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Teri Goodmann, Assistant City Manager
Maurice Jones, Economic Development Director
Masterpiece on the Mississippi
Dubuque
kattil
All- America City
1 I
TO: Michael Van Milligen, City Manager
FROM: Maurice Jones, Economic Development Director
SUBJECT: State of Iowa Economic Development Assistance Contract for TriState
Quality Metals, LLC.
DATE: December 10, 2013
INTRODUCTION
This memorandum presents for City Council review and approval a resolution
authorizing the submission of an Economic Development Assistance Contract by
TriState Quality Metals, LLC, the City of Dubuque and the Iowa Economic Development
Authority.
BACKGROUND
TriState Quality Metals, LLC is a sheet metal fabrication manufacturer formed in 2010 in
Peosta, Iowa. The company performs laser cutting of sheet metal, as well as plasma
cutting, bending, drilling, tapping, sawing and or /welding to create customized parts.
TriState Quality Metals also provides services including plating, maching, sheering, and
painting that are outsourced to other area manufactures. The company has grown from
a local customer base, to one that is regional, serving manufacturers in eastern Iowa,
northwestern Illinois, and southwestern Wisconsin. The largest customer, Rite Hite,
sells products to worldwide markets. In addition, TriState Quality Metals produces parts
for companies that ultimately sell to international manfacturers such as John Deere,
Caterpillar and Volvo.
The company plans to relocate to the Dubuque Industrial Center South to allow for
expansion of production capacity necessary for continued growth. The company has
determined that there is not a site suitable for such growth in Peosta. On September 3,
2013, the City Council executed an agreement with the City of Peosta, where in
accordance with urban renewal law, the Peosta City Council consented to the use of tax
increment financing by the City of Dubuque to incentivize the company. The City plans
to sell approximately seven acres of land to TriState Quality Metals through a
development agreement later this year for the construction of a 40,000 square foot
building. The company currently has 12 employees but has committed to expanding its
workforce to 22 employees. In exchange for the job growth, the City has planned to
provide a ten year tax increment rebate. The City Council endorsed an application for
State assistance on October 21, 2013.
DISCUSSION
The Economic Development Assistance Contract will solidify financial assistance from
the Iowa Economic Development Authority for TriState Quality Metals. The company is
eligible for an investment tax credit worth up to $74,400, and a sales and use tax rebate
of up to $72,000 for the construction of the new facility. The incentives are offered
through the State's High Quality Jobs Program and require a minimum capital
investment of $3,730,000. TriState Quality Metals must also create a minimum of 10
jobs associated with the project. The local match for the project will be the 10 -year tax
increment rebate, valued at approximately $580,000.
RECOMMENDATION
I recommend that the City Council authorize the Economic Development Assistance
Contract by TriState Quality Metals, the City of Dubuque, and the Iowa Economic
Development Authority, creating 10 new positions for the regional economy. This
project is consistent with the City's goals to grow existing businesses in the area and
further diversify the economic base.
ACTION STEP
The action step for the City Council is to adopt the attached resolution.
attachment
F: \USERS \Econ Dev \TriState Quality Metals \I EDA assistance \20131210 City Council contract.docx
RESOLUTION NO. 358 -13
A RESOLUTION AUTHORIZING THE EXECUTION OF AN ECONOMIC DEVELOPMENT
ASSISTANCE CONTRACT BY TRISTATE QUALITY METALS, LLC, THE CITY OF
DUBUQUE AND THE IOWA ECONOMIC DEVELOPMENT AUTHORITY.
Whereas, TriState Quality Metals, LLC has proposed making a $3.78 million investment
for the construction of a new facility in the Dubuque Industrial Center South; and
Whereas, the City Council of Dubuque, Iowa has considered said proposal and has
determined that the proposed project will contribute to the local economy. through the
creation of 10 additional jobs; and
Whereas, financial assistance from the Iowa Economic Development Authority is
designed to assist in the economic development efforts of local jurisdictions; and
Whereas, the City of Dubuque, Iowa provided local sponsorship on October 21, 2013 on
behalf of TriState Quality Metals, LLC for their Business Financial Assistance Application
with the Iowa Economic Development Authority.
Whereas, the Iowa Economic Development Authority has requested execution of an
Economic Development Assistance Contract with in order to finalize incentives and
document associated terms.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the Mayor is hereby authorized to execute and the City Manager is
hereby directed to submit the Economic Development Assistance Contract to the Iowa
Economic Development Authority together with such documents as may be required.
Passed, approved, and adopted this 16th day of December 2013.
Attest:
(9 41
F: \USERS \Econ Dev \TriState Quality Metals \IEDA assistance\20131216 City Council resolution.docx
Roy D. Buol, Mayor
ECONOMIC DEVELOPMENT
ASSISTANCE CONTRACT
BY
TRISTATE QUALITY METALS, LLC,
THE CITY OF DUBUQUE,
AND THE
IOWA ECONOMIC DEVELOPMENT AUTHORITY
CONTRACT NUMBER: 14 -TC -011
ARTICLE 1:
ARTICLE 2:
ARTICLE 3:
ARTICLE 4:
ARTICLE 5:
ARTICLE 6:
ARTICLE 7:
ARTICLE 8:
ARTICLE 9:
TABLE OF CONTENTS
CONTRACT DURATION
DEFINITIONS
AWARD TERMS
CONDITIONS TO DISBURSEMENT OF FUNDS AND ISSUANCE OF TAX
CREDIT NUMBER; DISBURSEMENT TERMS
SECURITY REQUIREMENTS
REPRESENTATIONS AND WARRANTIES
COVENANTS OF THE RECIPIENT
COVENANTS OF THE COMMUNITY
EVENTS OF DEFAULT; NOTICE AND OPPORTUNITY TO CURE; AND
REMEDIES AVAILABLE TO IEDA
ARTICLE 10: MISCELLANEOUS
CONTRACT EXHIBITS
Exhibit A -
Exhibit B -2
Exhibit C -
Exhibit D -
Exhibit E -
Exhibit F -
Contract # 14 -TC -011
Recipient's Financial Assistance Application (on file with IEDA), Application #
14 -HQJTC -008
High Quality Jobs Program - Tax Credit Special Conditions
Description of the Project and Award Budget
Job Obligations
Reserved
Reserved
- 2 -
Approi'ed 11/12
Economic Development
Assistance Contract
RECIPIENT: TRISTATE QUALITY METALS, LLC
COMMUNITY: CITY OF DUBUQUE
CONTRACT NUMBER: 14 -TC -011
AWARD DATE: OCTOBER 18, 2013
AWARD AMT. — TAX INCENTIVES $146,400
This ECONOMIC DEVELOPMENT ASSISTANCE CONTRACT (Contract) is made as of the
Contract Effective Date by the Iowa Economic Development Authority (IEDA), 200 East Grand Avenue,
Des Moines, IA 50309, and TriState Quality Metals, LLC (Recipient), 8673 Kapp Dr., Peosta, IA 52068
and the City of Dubuque (Community), 50 W 13th Street, Dubuque, IA 52001 -4805.
WHEREAS, the Recipient submitted an application to IEDA requesting assistance in the
financing of its Project as more fully described in Exhibit C, Description of the Project and Award
Budget (the Project); and
WHEREAS, the Iowa Economic Development Authority Board (IEDA Board) awarded the
Recipient assistance for the Project from the funding sources identified herein (collectively, the Award),
all of which are subject to the terms and conditions set forth herein; and
NOW THEREFORE, in consideration of the mutual promises contained herein and intending to
be legally bound, the Recipient, the Community and IEDA agree to the following terms:
Contract # 14 -TC -011 - 3 -
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ARTICLE l: CONTRACT DURATION
This Contract shall be in effect on the Contract Effective Date and shall remain in effect until after
completion of each of the following:
(a) Through Project Period Completion Date. Through the Project Period Completion Date and for a
reasonable period of time after Project Period Completion Date during which IEDA will conduct Project
closeout procedures to verify that the Project was completed in compliance with Contract requirements.
(b) Through Maintenance Period Completion Date and Contract Closeout. Through the Maintenance
Period Completion Date and for a reasonable period of time after Maintenance Period Completion Date
during which IEDA will conduct closeout procedures to verify that the Project was maintained in
compliance with Contract requirements.
(c) Repayment or payment Obligation. Until all outstanding amounts due to IEDA, if any, are
received by IEDA or all outstanding obligations to IEDA are satisfied in full.
(d) Contract End Date. Until IEDA has completed Contract closeout procedures and provided
Recipient and Community with written Notice of Final Contract Closeout. This Contract shall terminate
as of the date stated in the written Notice of Final Contract Closeout; such date shall be the Contract End
Date.
ARTICLE 2: DEFINITIONS
The following terms apply to this Contract:
"Award" means the sum of any and all assistance provided by IEDA for the Project under this
Contract.
"Award Date" means the date first stated in this Contract and is the date the IEDA Board approved
the awarding of financial assistance to the Recipient for the Project.
"Base Employment Level" means the number of full -time equivalent positions at a business, as
established by the authority and a business using the business's payroll records, as of the date a business
applies for tax incentives or project completion assistance. The number of jobs the business has pledged
to create and retain shall be in addition to the base employment level.
"Benefits" means nonwage compensation provided to an employee. Benefits include medical and
dental insurance plans, pension, retirement, and profit- sharing plans, child care services, life insurance
coverage, vision insurance coverage, and disability insurance coverage.
"Contract Effective Date" means the latest date on the signature page of this Contract.
"Contract End Date" means the date stated in the Notice of Final Contract Closeout issued by IEDA
pursuant to Article 1.
"Created Job" means a new, permanent, full -time equivalent (FTE) position added to a business's
payroll in excess of the base employment level at the time of application for tax incentives or project
completion assistance.
"Full -time equivalent job" or "full-time" means the employment of one person:
Contract # 14 -TC -011 - 4 -
Pint Approved 11/12
1. For 8 hours per day for a 5 -day, 40 -hour workweek for 52 weeks per year, including paid holidays,
vacations and other paid leave; or
2. The number of hours or days per week, including paid holidays, vacations and other paid leave,
currently established by schedule, custom, or otherwise, as constituting a week of full -time work for the
kind of service an individual performs for an employing unit, provided that the number of hours per week
is at least 32 hours per week for 52 weeks per year including paid holidays, vacations, and other paid
leave.
For purposes of this definition, "employment of one person" means the employment of one natural
person and does not include "job sharing" or any other means of aggregation or combination of hours
worked by more than one natural person.
"Job Obligations" means the jobs that must be created or retained as a result of a project's receiving
state or federal financial assistance, project completion assistance, or tax incentives from the authority and
that are required to meet the qualifying wage threshold requirements. Recipients job obligations are
specified in Exhibit D of this contract. Jobs that do not meet the qualifying wage threshold requirements
shall not be counted toward a business's job creation or job retention obligations contained in Exhibit D.
The job obligations in Exhibit D include the business's base employment level and the number of new
jobs required to be created above the base employment level.
"Laborshed Wage" means the qualifying wage threshold applicable to recipient's project as
calculated pursuant to rule 261 -173.2 and 261 - chapter 174 and as specified in Exhibit D of this contract.
"Maintenance Period" means the period of time between the Project Completion Date and the
Maintenance Period Completion Date. The Project must be maintained in Iowa for this period of time.
"Maintenance Period Completion Date" means the date on which the Maintenance Period ends. The
specific date on which the project maintenance period ends is identified in Exhibit D.
"Project" means the description of the work and activities to be completed by the Recipient as
outlined in Exhibit C - Description of the Project and Award Budget.
"Project Completion Date" means the date by which a recipient of incentives or assistance has
agreed to meet all the terms and obligations contained in this agreement. The project completion date will
be a date on which the project must be completed, all incented jobs must be created or retained, and all
other applicable requirements must be met. The specific date on which the project completion period
ends is identified in Exhibit D.
"Project Completion Assistance" means financial assistance or technical assistance provided to an
eligible business in order to facilitate the start-up, location, modernization, or expansion of the business in
this state and provided in an expedient manner to ensure the successful completion of the start-up
location, modernization, or expansion project.
"Project Completion Period" means the period of time between the date financial assistance is
awarded (the "award date ") and the project completion date.
"Qualifying Jobs" are those Created or Retained Jobs that meet or exceed the Qualifying Wage
Threshold Requirement established to qualify for program funding for the programs providing assistance
to this Project.
"Qualifying Wage Threshold" means the laborshed wage as calculated by IEDA pursuant to statute
and rule for each program that is providing financial assistance or tax credit incentives for this Project.
The Qualifying Wage Threshold Requirement for this Project is outlined in Exhibit D, Job Obligations.
Contract # 14 -TC -0I 1 - 5 -
Fm1 Approved 11/12
"Retained Job" means an existing job that meets the Qualifying Wage Threshold Requirements and
would be eliminated or moved to another state if the Project did not proceed in Iowa.
"Sufficient Benefits" means that the employer offers to each full -time equivalent permanent position a
benefits package that meets one of the following:
1. The employer pays 80 percent of the premium costs for a standard medical and dental plan for
single employee coverage with a $750 maximum deductible; or
2. The employer pays 50 percent of the premium costs for a standard medical and dental plan for
employee family coverage with a $1,500 maximum deductible; or
3. The employer provides medical coverage and pays the monetary equivalent of paragraph "1" or
"2" above in supplemental employee benefits. Benefits counted toward monetary equivalent could
include medical coverage, dental coverage, vision insurance, life insurance, pension, retirement (401k),
profit sharing, disability insurance, child care services.
"Tax Incentives" means the tax credits, refunds and other authorized benefits IEDA has awarded for
this Project as detailed in Article 3.
"Total Project Cost" means the cost incurred by the Recipient to complete the Project as described in
Exhibit C.
ARTICLE 3: AWARD TERMS
3.1 Total Award Amount. The IEDA Board has approved an Award to the Community and
Recipient from the funding sources and in the maximum amounts shown below:
TAX INCENTIVES
High Quality Jobs Program
Tax Incentives
$ 146,400
TOTAL STATE TAX INCENTIVES:
$146,400
3.2 Terms and Conditions of Award. The terms and conditions of the Award shall be as described
in this Contract and the following incorporated exhibit(s):
Exhibit B -2
High Quality Jobs Program — Tax Credit Component Special Conditions
ARTICLE 4: CONDITIONS TO AWARD; DISBURSEMENT AND ISSUANCE TERMS
4.1 Reserved.
4.2 Tax Incentives— Conditions to Issuance of Tax Credit Number.
(a) Tax Credit Number Required to Claim Incentives. Recipient shall not claim the Tax Incentives
described in Article 3 until IEDA has issued a tax credit number for this Project and Recipient has
undertaken the activities described in this Contract and the applicable law to be eligible for such Tax
Incentives.
(b) Issuance of Tax Credit Number. Upon satisfaction of the conditions described in herein, IEDA
will issue a tax credit number to the Recipient for this Project. The tax credit number shall be used in
preparing any claims for Tax Incentives
Contract # 14 -TC -011 - 6 -
Fog Approved 11/12
(c) Conditions to Issuance of Tax Credit Number. The obligation of IEDA to issue a tax credit
number shall be subject to the conditions precedent described in Article 4.
(d) Documents Submitted. IEDA shall have received the documents described in section 4.3, properly
executed and completed, and approved by IEDA as to form and substance, prior to issuing any tax credit
number.
4.3 Documents required.
(a) Contract. Fully executed Contract.
(b) Incorporation Documents. Copies of the Articles of Incorporation or the Articles of
Organization, whichever is appropriate, of the Recipient, certified in each instance by its secretary or
assistant secretary.
(c) Certificate of Existence; Certificate of Authority. A certificate of existence for the Recipient from
the State of incorporation or organization, whichever is appropriate, and a certificate of authority
authorizing the Recipient to conduct business in the state of Iowa, if it is not organized or incorporated in
Iowa.
(d) Results of Lien and Tax Search and Documentation of Satisfactory Credit History. Financing
statement, tax and judgment lien search results, in the Recipient's state of incorporation or organization,
against the Recipient and documentation of satisfactory credit history of the Recipient and guarantors, as
applicable, with no judgments or unsatisfied liens or similar adverse credit actions.
(e) Other Required Documents. IEDA shall have received such other contracts, instruments,
documents, certificates and opinions as IEDA may reasonably request.
(f) Solid or Hazardous Waste Audit. To comply with Iowa Code section 15A.1 (3)"b," if the
Recipient generates solid or hazardous waste, it must either: a) submit a copy of the Recipient's existing
in -house plan to reduce the amount of waste and safely dispose of the waste based on an in -house audit
conducted within the past 3 years; or b) submit an outline of a plan to be developed in- house; or c) submit
documentation that the Recipient has authorized the Iowa Department of Natural Resources or Iowa
Waste Reduction Center to conduct the audit.
(g) Release Form — Confidential Tax Information. A signed Authorization for Release of
Confidential State Tax Information form to permit IEDA to receive the Recipient's state tax information
directly from the Iowa Department of Revenue for the purpose of evaluation and administration of tax
credit programs and other state financial assistance programs.
(h) Project Financial Commitments. The Recipient shall have submitted documentation acceptable
to IEDA from the funding sources identified in Exhibit A committing to the specified financial
involvement in the Project and received the IEDA's approval of the documentation. The documentation
shall include the amount, terms and conditions of the financial commitment, as well as any applicable
schedules and may include agreements and resolutions to that effect.
(i) State Building Code Bureau Approval. If any part of the Award proceeds will be used for the
construction of new buildings, bidding for construction shall not be conducted prior to the written
approval of the final plans by the State Building Code Bureau of the Iowa Department of Public Safety,
and only if either of the following applies:
Contract # 14 -TC -011 - 7 -
Fm! Approved I 1/12
1. The building or structure is located in a governmental subdivision which has not adopted a
local building code; or
2. The building or structure is located in a governmental subdivision which has adopted a
building code, but the building code is not enforced.
4.4 Suspension, Reduction or Delay of Award. Any one or more of the following shall be grounds for
IEDA to delay the issuance of a tax credit number or receipt of other Tax Incentives:
(a) Unremedied event of default. Upon the occurrence of an Event of Default (as defined in this
Contract) by the Recipient, the IEDA may suspend the issuance of the Award to the Recipient until such
time as the default has been cured to IEDA's satisfaction.
(b) Layoff closure or relocation. In the event the Recipient experiences a layoff within the state of
Iowa, relocates or closes any of its Iowa facilities IEDA has the discretion to reduce or eliminate some or
all of the amount of tax incentives to be received.
(c) Reduction, discontinuance or alteration of state funding /programs. Any termination, reduction,
or delay of tax incentives available due, in whole or in part, to (i) lack of, reduction in, or a
deappropriation of tax incentives previously appropriated or authorized for this Contract, or (ii) any other
reason beyond the IEDA's control may, in the IEDA's discretion, result in the suspension, reduction or
delay of authorization or issuance of Tax Incentives to the Recipient.
ARTICLE 5: RESERVED.
ARTICLE 6: REPRESENTATIONS AND WARRANTIES
6.1 Representations of Recipient. The Recipient represents and warrants to IEDA as follows:
(a) Organization and Qualifications. The Recipient is duly organized, validly existing and in good
standing under the state of its incorporation or organization, whichever is appropriate, and is authorized to
conduct business in the state of Iowa. The Recipient has full and adequate power to own its property and
conduct its business as now conducted, and is duly licensed or qualified and in good standing in each
jurisdiction in which the nature of the business conducted by it or the nature of the property owned or
leased by it requires such licensing or qualifying, except where the failure to so qualify would not have a
material adverse effect on the Recipient's ability to perform its obligations hereunder.
(b) Authority and Validity of Obligations. The Recipient has full right and authority to enter into this
Contract. The person signing this Contract has full authority on behalf of Recipient to execute this
Contract and issue, execute or otherwise secure or deliver any documents or obligations required under
this Contract on behalf of the Recipient; and to perform, or cause to be performed, each and all of the
obligations under the Contract.
The Contract delivered by the Recipient has been duly authorized, executed and delivered by the
Recipient and constitute the valid and binding obligations of the Recipient and is enforceable against it in
accordance with its terms. This Contract and related documents do not contravene any provision of law
or any judgment, injunction, order, or decree binding upon the Recipient or any provision of the corporate
governance documents of the Recipient, nor does this Contract contravene or constitute a default under
any covenant, indenture or contract of or effecting the Recipient or any of its properties.
(c) Subsidiaries. The Recipient has no Subsidiaries involved with the Project on the Contract
Contract # 14 -TC -011 _ g _
Fn1 Approved 11/12
Effective Date.
(d) Financial Reports. The balance sheet of the Recipient furnished to IEDA fairly presents its
financial condition as at said date in conformity with Generally Accepted Accounting Principles (GAAP)
applied on a consistent basis. The Recipient has no contingent liabilities which are material to it, other
than as indicated on such financial statements or, with respect to future periods, on the financial
statements furnished to IEDA.
(e) No Material Adverse Change. Since the Award Date, there has been no change or the Recipient
foresees no change in the condition (financial or otherwise) of the Recipient or the prospects of the
Recipient, except those occurring in the ordinary course of business, none of which individually or in the
aggregate have been materially adverse. To the knowledge of the Recipient, there has been no material
adverse change in the condition of the Recipient (financial or otherwise) or the prospects of the Recipient.
(f) Full Disclosure; Recipient's Financial Assistance Application. The statements and other
information furnished to the IEDA by Recipient in its Financial Assistance Application and in connection
with the negotiation of this Contract do not contain any untrue statements of a material fact or omit a
material fact necessary to make the material statements contained herein or therein not misleading. The
IEDA acknowledges that as to any projections furnished to the IEDA, the Recipient only represents that
the same were prepared on the basis of information and estimates it believed to be reasonable.
(g) Trademarks, Franchises and Licenses. The Recipient owns, possesses, or has the right to use all
necessary patents, licenses, franchises, trademarks, trade names, trade styles, copyrights, trade secrets,
knowhow and confidential commercial and proprietary information to conduct its business as now
conducted, without known conflict with any patent, license, franchise, trademark, trade name, trade style,
copyright or other proprietary right of any other Person. As used in this Contract, "Person" means an
individual, partnership, corporation, association, trust, unincorporated organization or any other entity or
organization, including a government or agency or political subdivision thereof.
(h) Governmental Authority and Licensing. The Recipient has received all licenses, permits, and
approvals of all Federal, state, local, and foreign governmental authorities, if any, necessary to conduct its
business, in each case where the failure to obtain or maintain the same could reasonably be expected to
have a material adverse effect. No investigation or proceeding which, if adversely determined, could
reasonably be expected to result in revocation or denial of any material license, permit, or approval is
pending or, to the knowledge of the Recipient threatened.
(i) Litigation and Other Controversies. There is no litigation or governmental proceeding pending,
nor to the knowledge of the Recipient threatened, against the Recipient which if adversely determined
would result in any material adverse change in the financial condition, properties, business or operations
of the Recipient, nor is the Recipient aware of any existing basis for any such litigation or governmental
proceeding.
(j) Good Title. The Recipient has good and defensible title to (or valid leasehold interests in) all of
its property involved with the Project (including, without limitation, the Secured Property if real property
is a security for this Contract) reflected on the most recent balance sheets furnished to the IEDA (except
for sales of assets in the ordinary course of business).
(k) Taxes. All tax returns required to be filed by the Recipient in any jurisdiction have, in fact, been
filed, and all taxes, assessments, fees and other governmental charges upon the Recipient or upon any of
its property, income or franchises, which are shown to be due and payable in such returns, have been paid,
except such taxes, assessments, fees and governmental charges, if any, as are being contested in good
faith and by appropriate proceedings which prevent enforcement of the matter under contest and as to
which adequate reserves established in accordance with GAAP have been provided. The Recipient knows
Contract # 14 -TC -011 - 9 -
Fmt Approved 11/12
of no proposed additional tax assessment against it for which adequate provisions in accordance with
GAAP have not been made on its accounts. Adequate provisions in accordance with GAAP for taxes on
the books of the Recipient have been made for all open years, and for their current fiscal period.
(1) Other Contracts. The Recipient is not in default under the terms or any covenant, indenture or
contract of or affecting either the Recipient's business or any of its properties, which default, if uncured,
would have a material adverse effect on its financial condition, properties, business or operations.
(m) No Event of Default. No Event of Default, as defined in Article 9, has occurred or is continuing.
(n) Compliance with Laws. The Recipient is in compliance with the requirements of all federal,
state and local laws, rules and regulations applicable to or pertaining to the business operations of the
Recipient and laws and regulations establishing quality criteria and standards for air, water, land and toxic
or hazardous wastes or substances, non - compliance with which could have a material adverse effect on
the financial condition, properties, business or operations of the Recipient. The Recipient has not
received notice to the effect that its operations are not in compliance with any of the requirements of
applicable federal, state or local environmental or health and safety statutes and regulations or are the
subject of any governmental investigation evaluating whether any remedial action is needed to respond to
a release of any toxic or hazardous waste or substance into the environment, which non - compliance or
remedial action could have a material adverse effect on the financial condition, properties, business or
operations of the Recipient.
(o) Effective Date of Representations and Warranties. The warranties and representations of this
Article are made as of the Contract Effective Date and shall be deemed to be renewed and restated by the
Recipient each time Tax Incentives are claimed by the Recipient.
6.2 Representations of Community.
(a) Local Approvals Received; Authority and Validity of Obligations. The Community has secured all
necessary local approvals and has full right and authority to enter into this Contract. The person signing
this Contract has full authority on behalf of the Community to:
1. Sign this Contract, and
2. Perform each and all of the Community's obligations under this Contract.
The Contract delivered by the Community has been duly authorized, executed and delivered by the
Community and constitutes the valid and binding obligations of the Community and is enforceable
against it in accordance with its terms. This Contract and related documents do not contravene any
provision of law or any judgment, injunction, order or decree binding upon the Community, contravene or
constitute a default under any covenant, indenture or contract of or effecting the Community or any of its
properties.
(b) Local Commitment. The Community represents that there are legally enforceable commitments in
place for the Community local commitment identified for the Project in Exhibit C - Description of the
Project and Award Budget.
(c) No Material Adverse Change. Since the Award Date, there has been no material adverse change
in the Community's ability to perform its obligations under this Contract.
(d) Full Disclosure; Community's Financial Assistance Application. The statements and other
information furnished to the IEDA by the Community in its Financial Assistance Application and in
connection with the negotiation of this Contract do not contain any untrue statements of a material fact or
omit a material fact necessary to make the material statements contained herein or therein not misleading.
The IEDA acknowledges that as to any projections furnished to the IEDA, the Community only
Contract # 14 -TC -011 - 10 -
Fm! Approved 11/12
represents that the same were prepared on the basis of information and estimates it believed to be
reasonable.
(e) Governmental Authority and Licensing. The Community has received all licenses, permits, and
approvals of all federal, state, local, and foreign governmental authorities, if any, necessary to perform its
obligations under this Contract. No investigation or proceeding which, if adversely determined, could
reasonably be expected to result in revocation or denial of any material license, permit, or approval is
pending or, to the knowledge of the Community threatened.
(f) Litigation and Other Controversies. There is no litigation or governmental proceeding pending,
nor to the knowledge of the Community threatened, against the Community which if adversely
determined would result in any material adverse change in the Community's ability to perform under this
Contract nor is the Community aware of any existing basis for any such litigation or governmental
proceeding.
(g) No Event of Default. No Event of Default by the Community, as defined in Article 9, has
occurred or is continuing.
(h) Compliance with Laws. The Community is in compliance with the requirements of all federal,
state and local laws, rules and regulations applicable to or pertaining to the operations of the Community
and laws and regulations establishing quality criteria and standards for air, water, land and toxic or
hazardous wastes or substances, non - compliance with which could have a material adverse effect on the
financial condition, properties, business or operations of the Community. The Community has not
received notice to the effect that its operations are not in compliance with any of the requirements of
applicable federal, state or local environmental or health and safety statutes and regulations or are the
subject of any governmental investigation evaluating whether any remedial action is needed to respond to
a release of any toxic or hazardous waste or substance into the environment, which non - compliance or
remedial action could have a material adverse effect on the financial condition, properties, business or
operations of the Community.
(i) Effective Date of Representations and Warranties. The warranties and representations of this
Article are made as of the Contract Effective Date.
ARTICLE 7: COVENANTS OF THE RECIPIENT
For the duration of this Contract, the Recipient covenants to IEDA as follows:
7.1 Project Performance Obligations.
(a) Reserved.
(b) Meet and Maintain Eligibility Requirements. Recipient shall continue to meet and maintain all
statutory eligibility requirements for the funding sources providing assistance under this Contract.
(c) Project Time Period. This Contract covers the five (5) year Project time period from the Award
Date through the Maintenance Period Completion Date. Recipient shall complete and maintain the Project
within the Project time period shown below:
Contract # 14-TC-01 1 - 11 -
Fm! Approved 11/12
COMPLIANCE
MEASUREMENT
POINT
COMPLIANCE
MEASUREMENT
POINT
Award
Date
Project
Completion
Period
Project
Completion Date !
Maintenance
Period
Maintenance Period
Completion Date
Contract
Closeout
"Award Date"
"Project
"Project
"Maintenance
"Maintenance Period
IEDA will conduct
means the date
Completion
Completion Date"
Period" means
Completion Date"
Contract Closeout
first stated in this
Period" means the
means the date 3
the period of
means the date 2 years
procedures after all
Contract and is
period of time
years from the
time between
from the Project
events described in
the date the
between the Award
Award Date.
the Project
Completion Date and
Article 1 have been
IEDA Board
Date and the
Recipient must
Completion
is the date on which
met.
approved the
Project Completion
complete the Project
Date and the
the Maintenance
awarding of
financial
Date.
by this date.
Maintenance
Period
Period ends.
"Contract End Date"
means the date stated
assistance to the
At this point, IEDA
Completion
At this point, IEDA
in IEDA's written
Recipient for the
will review the
Date. The
will review the Project
Notice of Final
Project.
Project to verify
Project must be
to verify that it was
Contract Closeout
compliance with
maintained in
maintained in
that is issued
Contract terms and
obligations.
Iowa for this
period of time.
compliance with
Contract terms and
obligations.
pursuant to Article 1.
(d) Complete Project by Project Completion Date. By the Project Completion Date, Recipient shall
complete the Project, make the total investment it pledged for the Project and in accordance with the
Award Budget as detailed in Exhibit C - Description of the Project and Award Budget, and comply with
all other performance requirements described in this Contract.
(e) Total Project Costs. By the Project Completion Date, Recipient shall have completed the Project
with a Total Project Cost as detailed in Exhibit C - Description of the Project and Award Budget.
(f) Maintain Project through Maintenance Period Completion Date. Recipient shall maintain the
Project through the Maintenance Period Completion Date.
(g) Maintain Project in Iowa During Contract Period. The Recipient shall at all times preserve and
maintain its existence as a corporation in good standing and maintain the Project in Iowa. The Recipient
will preserve and keep in force and affect all licenses, permits, franchises, approvals, patents, trademarks,
trade names, trade styles, copyrights and other proprietary rights necessary to the proper conduct of its
respective Recipient.
7.2 Taxes and Insurance.
(a) Pay Taxes and Assessments. The Recipient shall duly pay and discharge all taxes, rates,
assessments, fees, and governmental charges upon or against its properties, in each case before the same
become delinquent and before penalties accrue thereon, unless and to the extent that the same are being
contested in good faith and by appropriate proceedings and adequate reserves are provided therefore.
(b) Maintain Insurance. The Recipient shall insure and keep insured in good and responsible
insurance companies, all insurable property owned by it which is of a character usually insured by
Persons similarly situated and operating like properties against loss or damage from such hazards or risks
as are insured by Persons similarly situated and operating like properties; and the Recipient shall insure
such other hazards and risks (including employers' and public liability risks) in good and responsible
insurance companies as and to the extent usually insured by Persons similarly situated and conducting
similar business. The Recipient will upon request of IEDA furnish a certificate setting forth in summary
form the nature and extent of the insurance maintained pursuant to this Article.
Contract # 14 -TC -011 - 12 -
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7.3 Preserve Project.
(a) Maintenance of Properties. The Recipient shall maintain, preserve and keep its properties in good
repair, working order and condition (ordinary wear and tear excepted) and will from time to time make all
needful and proper repairs, renewals, replacements, additions and betterments thereto so that at all times
the efficiency thereof shall be fully preserved and maintained in accordance with prudent business
practices.
(b) Reserved.
7.4 Recipient Changes.
(a) No Changes in Recipient Operations. The Recipient shall not materially change the Project or the
nature of the business and activities being conducted, or proposed to be conducted by Recipient, as
described in the Recipient's approved application for funding, Exhibit A of this Contract, unless approved
in writing by IEDA prior to the change.
(b) Changes in Recipient Ownership, Structure and Control. The Recipient shall not materially
change the ownership, structure, or control of the business if it would adversely affect the Project. This
includes, but is not limited to, entering into any merger or consolidation with any person, firm or
corporation or permitting substantial distribution, liquidation or other disposal of assets directly
associated with the Project. Recipient shall provide IEDA with advance notice of any proposed changes
in ownership, structure or control. The materiality of the change and whether or not the change affects the
Project shall be as reasonably determined by IEDA.
7.5 Required Reports.
(a) Review of Reports. The Recipient shall prepare, sign and submit required reports, in the form and
content required by IEDA, as specified in this Contract.
(b) Reports. The Recipient shall prepare, sign and submit the following reports to the IEDA
throughout the Contract period:
Report
Due Date
Annual Project Status Report
July 3 ls` for the period ending June 30th
The Annual Project Status Report will collect
information from the Recipient about the status
of the Project.
End of Project Report
Within 30 days of Project Completion Date
The End of Project Report will collect
information from the Recipient about the
completed Project.
End of Maintenance Period Report
Within 30 days of the end of the Job
Maintenance Period Completion Date
The End of Maintenance Period Report will
collect information from the Recipient's
continued maintenance of the Project.
(c) Additional Reports, Financial Statements as Requested by IEDA. The IEDA reserves the right to
Contract # 14 -TC -011
- 13 -
Fm! Approved 11/12
require more frequent submission of reports if, in the opinion of the IEDA, more frequent submissions
would provide needed information about Recipient's Project performance, or if necessary in order to meet
requests from the Iowa General Assembly, the Department of Management or the Governor's office. At
the request of IEDA, Recipient shall submit its annual financial statements completed or reviewed by an
independent CPA, or other financial statements including, but not limited to, income, expense, and
retained earnings statements.
7.6 Compliance with Laws.
(a) State, local and federal laws. Recipient shall comply in all material respects with the
requirements of all applicable federal, state and local laws, rules, regulations and orders.
(b) Environmental laws. Recipient shall comply in all material respects with all applicable
environmental, hazardous waste or substance, toxic substance and underground storage laws and
regulations, and the Recipient shall obtain any penuits or, licenses and shall acquire or construct any
buildings, improvements, fixtures, equipment or its property required by reason of any applicable
environmental, hazardous waste or substance, toxic substance or underground storage laws or regulations.
(c) Nondiscrimination laws. Recipient shall comply in all material respects with all applicable
federal, state, and local laws, rules, ordinances, regulations and orders applicable to the prevention of
discrimination in employment, including the administrative rules of the Iowa Department of Management
and the Iowa Civil Rights Commission which pertain to equal employment opportunity and affirmative
action.
(d) Worker rights and safety. The Recipient shall comply in all material respects with all applicable
federal, state and local laws, rules, ordinances, regulations and orders applicable to worker rights and
worker safety.
(e) Immigration laws. Recipient shall only employ individuals legally authorized to work in this
state. In addition to any and all other applicable penalties provided by current law, all or a portion of the
Award is subject to recapture by IEDA if Recipient is found to knowingly employ individuals not legally
authorized to work in the state of Iowa.
(f) Compliance with IEDA's Administrative Rules. Recipient shall comply with IEDA's
administrative rules for the programs providing assistance to the Project and rules governing
administration of this Contract.
7.7 Inspection and Audit. The Recipient shall permit the IEDA and its duly authorized
representatives, at such reasonable times and reasonable intervals as the IEDA may designate, to:
(a) Conduct site visits and inspect the Project.
(b) Audit financial records related to the Project.
(c) Examine and make copies of the books of accounts and other financial records of the Recipient
related to the Project.
(d) Discuss the affairs, finances and accounts of the Recipient with, and to be advised as to the same
by, its officers, and independent public accountants (and by this provision the Recipient authorizes such
accountants to discuss with the IEDA and the IEDA's duly authorized representatives the finances and
affairs of the Recipient).
Contract # 14 -TC -011 - 14 -
Fm! Approved 11/12
7.8 Maintenance and Retention of Records.
(a) Maintain Accounting Records. The Recipient is required to maintain its books, records and all
other evidence pertaining to this Contract in accordance with GAAP or another NASBA recognized
accounting framework and such other procedures specified by IEDA.
(b) Access to Records. Records to verify compliance with the terms of this Contract shall be available
at all times, and made available to IEDA and its designees at places and times designated by IEDA, for
the duration of this Contract and any extensions thereof. Recipient shall make its records available to: (i)
IEDA; (ii) IEDA's internal or external auditors, agents and designees; (iii) the Auditor of the State of
Iowa; (iv) the Attorney General of the State of Iowa; and (v) the Iowa Division of Criminal Investigations
and any other applicable law enforcement agencies.
(c) Records Retention Period. Recipient shall retain the records for a period of three (3) years from
the Contract End Date, unless the records are the subject of an audit, investigation, or administrative or
legal proceeding. In those instances, the records shall be retained until the audit, investigation or
proceeding has been resolved.
7.9 Required Notices from Recipient to IEDA.
(a) Notice of Major Changes. The Recipient shall promptly provide IEDA with written notice of any
major changes that would impact the success of the Project.
(b) Notice of Meetings. The Recipient shall notify IEDA within 3 business days following any
meeting at which the Project is discussed, the outcome of which is likely to result in a negative impact on
the Project, and Recipient shall timely provide IEDA with a written summary of the outcome of any such
Project - related discussion.
(c) Notice of Proceedings. The Recipient shall promptly notify IEDA of the initiation of any claims,
lawsuits, bankruptcy proceedings or other proceedings brought against the Recipient which would
adversely impact the Project.
7.10 Indemnification. The Recipient shall indemnify, defend and hold harmless the IEDA, the State
of Iowa, its departments, divisions, agencies, sections, commissions, officers, employees and agents from
and against all losses, liabilities, penalties, fines, damages and claims (including taxes), and all related
costs and expenses (including reasonable attorneys' fees and disbursements and costs of investigation,
litigation, settlement, judgments, interest and penalties), arising from or in connection with any of the
following:
(a) Any claim, demand, action, citation or legal proceeding arising out of or resulting from the
Project;
(b) Any claim, demand, action, citation or legal proceeding arising out of or resulting from a breach
by the Recipient of any representation, warranty or covenant made by the Recipient in this Contract;
(c) Any claim, demand, action, citation or legal proceeding arising out of or related to occurrences
that the Recipient is required to insure against as provided for in this Contract; and
(d) Any claim, demand, action, citation or legal proceeding which results from an act or omission of
the Recipient or any of their agents in its or their capacity as an employer of a person.
7.11 Repayment of Unallowable Costs. Recipient shall repay any Award received or realized that is
determined by IEDA, its auditors, agents or designees, the Auditor of the State of Iowa, or similar
Contract # 14 -TC -011 - 15 -
Fmt Approved 11/12
authorized governmental entity to be unallowable under the terms of this Contract.
ARTICLE 8: COVENANTS OF THE COMMUNITY
For the duration of this Contract, the Community covenants to IEDA as follows:
8.1 Local Match. The Community shall provide the local financial assistance for the Project as
described in Exhibit C, Project Description and Award Budget.
8.2 Notice to IEDA. In the event the Community becomes aware of any material alteration in the
Project, initiation of any investigation or proceeding involving the Project, change in the Recipient'
ownership, structure or operation, or any other similar occurrence, the Community shall promptly provide
written notice to IEDA.
ARTICLE 9: DEFAULTS AND REMEDIES
9.1 Default by Recipient. An unremedied Event of Default can result in termination of this Contract
and repayment of all or a portion of the value of the Tax Incentives actually received, plus applicable
default interest and costs.
(a) Events of Default Any one or more of the following shall constitute an "Event of Default" under
this Contract:
1. Nonpayment. Failure to make a payment when due (whether by lapse of time, acceleration or
otherwise) for more than ten (10) business days of the due date thereof of any Loan or other payment
required by this Contract; or
2. Noncompliance with Covenants. Default in the observance or performance of any covenant
set forth in Article 7, for more than five (5) business days; or
3. Noncompliance with Security Documents. Default in the observance or performance of any
term of any Security Document if required in Article 5 beyond any applicable grace period set forth
therein; or
4. Noncompliance with Contract. Default in the observance or performance of any other
provision of this Contract; or
5. Material Misrepresentation. Any representation or warranty made by the Recipient in this
Contract or in any statement or certificate furnished by it pursuant to this Contract, or made in Exhibit A,
Recipient's Financial Assistance Application, or in connection with any of the above, proves untrue in
any material respect as of the date of the issuance or making thereof; or
6. Security Deficiencies. Any of the Security Documents that represent the Security pledged by
Recipient to secure this Contract shall for any reason fail to create a valid and perfected priority security
interest in favor of the IEDA; or
7. Judgment. Any judgment or judgments, writ or writs or warrant or warrants of attachment,
or any similar process or processes entered or filed against the Recipient or against any of its property and
remains unvacated, unbonded or unstayed for a period of 30 days which materially and adversely affects
Recipient's ability to perform its obligations under this Contract; or
Contract # 14 -TC -011 - 16 -
Fm! Approved 11/12
8. Adverse Change in Financial Condition. Any change shall occur in the financial condition of
the Recipient which would have a material adverse effect on the ability of the Recipient to perform under
this Contract; or
9. Bankruptcy or Similar Proceedings Initiated. Either the Recipient shall (i) have entered
involuntarily against it an order for relief under the United States Bankruptcy Code, as amended, (ii) not
pay, or admit in writing its inability to pay, its debts generally as they become due, (iii) make an
assignment for the benefit of creditors, (iv) apply for, seek, consent to, or acquiesce in, the appointment of
a receiver, custodian, trustee, examiner, liquidator or similar official for it or any substantial part of its
property, (v) institute any proceeding seeking to have entered against it an order for relief under the
United States Bankruptcy Code as amended, to adjudicate it insolvent, or seeking dissolution, winding up,
liquidation, reorganization, arrangement, adjustment or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors or fail to file an answer or other
pleading denying the material allegations of any such proceeding filed against it, or (vi) fail to contest in
good faith any appointments or proceeding described below; or
10. Appointment of Officials. A custodian, receiver, trustee, examiner, liquidator or similar
official shall be appointed for either the Recipient or any substantial part of any of its respective property,
or a proceeding described above shall be instituted against either the Recipient and such appointment
continues undischarged or such proceeding continues undismissed or unstayed for a period of sixty (60)
days; or
11. Insecurity. IEDA shall in good faith deem itself insecure and reasonably believes, after
consideration of all the facts and circumstances then existing, that the prospect of payment and
satisfaction of the obligations under this Contract, or the performance of or observance of the covenants
in this Contract, is or will be materially impaired; or
12. Failure to Submit Required Reports. The Recipient fails to submit complete reports by the
required due dates as outlined in Article 7; or
13. Layoffs, Relocation or Closure. The Recipient experiences a layoff, relocates or closes any of
its facilities within the state of Iowa; or
14. Failure to Maintain Program Eligibility Requirements. Recipient fails to maintain a statutory
eligibility requirement for a program providing assistance under this Contract.
(b) Notice of Default and Opportunity to Cure. If IEDA has reasonable cause to believe that an Event
of Default has occurred under this Contract, IEDA shall issue a written Notice of Default to the Recipient,
setting forth the nature of the alleged default in reasonable specificity, and providing therein a reasonable
period of time, which shall not be fewer than thirty (30) days from the date of the Notice of Default, in
which the Recipient shall have an opportunity to cure, provided that cure is possible and feasible.
(c) Remedies Available to IEDA. When an Event of Default has occurred and is not cured within the
required time period, IEDA may, after written notice to Recipient:
1. Terminate this Contract.
2. Reserved.
3. Reserved.
4. Revoke or reduce authorized Tax Incentives.
Contract # 14 -TC -011 - 17 -
Fmt Approved 11/12
5. Require full repayment of all or a portion of the value of Tax Incentives received.
(d) Reserved.
(e) Expenses. The Recipient agrees to pay to the IEDA all expenses reasonably incurred or paid by
IEDA including reasonable attorneys' fees and court costs, in connection with any Default or Event of
Default by the Recipient or in connection with the enforcement of any of the terms of this Contract.
9.2 Default by Community. An unremedied Event of Default can result in termination of this
Contract and repayment by Community of all or a portion of the pledged local match, plus applicable
default interest and costs.
(a) Events of Default. Any one or more of the following shall constitute an "Event of Default by
Community" under this Contract:
1. Noncompliance with Covenants. Default in the observance or performance of any covenants
of the Community set forth in Article 8, for more than five (5) business days; or
2. Material Misrepresentation. Any representation or warranty made by the Community in this
Contract or in any statement or certificate furnished by it pursuant to this Contract, or made by
Community in Exhibit A, Recipient's Financial Assistance Application, or in connection with any of the
above, proves untrue in any material respect as of the date of the issuance or making thereof; or
(b) Notice of Default and Opportunity to Cure. If IEDA has reasonable cause to believe that an Event
of Default has occurred under this Contract, IEDA shall issue a written Notice of Default to the
Community, setting forth the nature of the alleged default in reasonable specificity, and providing therein
a reasonable period time, which shall not be fewer than thirty (30) days from the date of the Notice of
Default, in which the Community shall have an opportunity to cure, provided that cure is possible and
feasible.
(c) Remedies Available to IEDA When an Event of Default by Community has occurred and is not
cured within the required time period, IEDA may, after written notice to Community-
1. Suspend or reduce pending and future disbursements to Community.
2. Require repayment by Community for the amount of local financial assistance pledged to the
Project but not provided.
(d) Default Interest Rate. If an Event of Default occurs and remains uncured, a default interest rate
of 6% shall apply to repayment of amounts due under this Contract. The default interest rate shall accrue
from the first date Tax Incentives are received.
(e) Expenses. The Community agrees to pay to the IEDA all expenses reasonably incurred or paid by
IEDA including reasonable attorneys' fees and court costs, in connection with any Default or Event of
Default by the Community or in connection with the enforcement of any of the terms of this Contract.
ARTICLE 10: MISCELLANEOUS.
10.1 Choice of Law and Forum; Governing Law.
(a) In the event any proceeding of a quasi-judicial or judicial nature is commenced in connection
Contract # 14 -TC -011 - 18 -
Fml Approved 11/12
with this Contract, the proceeding shall be brought in Des Moines, Iowa, in Polk County District Court
for the State of Iowa, if such court has jurisdiction. If however, such court lacks jurisdiction and
jurisdiction lies only in a United States District Court, the matter shall be commenced in the United States
District Court for the Southern District of Iowa, Central Division.
(b) This provision shall not be construed as waiving any immunity to suit or liability, in state or
federal court, which may be available to the IEDA, the State of Iowa or its members, officers, employees
or agents.
(c) This Contract and the rights and duties of the parties hereto shall be governed by, and construed
in accordance with the internal laws of the State of Iowa without regard to principles of conflicts of laws.
10.2 Contract Amendments. Neither this Contract nor any documents incorporated by reference in
connection with this Contract, may be changed, waived, discharged or terminated orally, but only as
provided below:
(a) Writing required. The Contract may only be amended if done so in writing and signed all the
parties. Examples of situations requiring an amendment include, but are not limited to, time extensions,
budget revisions, and significant alterations of existing activities or beneficiaries.
(b) IEDA Board review. Requests to amend this Contract shall be processed by IEDA in compliance
with the IEDA Board's rules and procedures applicable to contract amendments.
10.3 Notices. Except as otherwise specified herein, all notices hereunder shall be in writing (including,
without limitation by fax) and shall be given to the relevant party at its address, e -mail address, or fax
number set forth below, or such other address, e -mail address, or fax number as such party may hereafter
specify by notice to the other given by United States mail, by fax or by other telecommunication device
capable of creating a written record of such notice and its receipt. Notices hereunder shall be addressed:
To the Recipient at:
TriState Quality Metals, LLC
Kenny LeGrand, Controller
8673 Kapp Dr.
Peosta, IA 52068
E -mail: Kenny @tsgmetals.com
Telephone: 563.582.7400
Facsimile: 563.582.7409
To the IEDA at:
Iowa Economic Development Authority
Compliance
200 East Grand Avenue
Des Moines, Iowa 50309
Attention: Business Development - Compliance
E -mail: Compliance @iowa.gov
Telephone: 515.725.3000
Facsimile: 515.725.3010
To the Community at:
City of Dubuque
Phil Wagner, Asst. Economic Development Director
Contract # 14 -TC -011 - 19 -
Fog Approved 11/12
50 W 13th Street
Dubuque, IA 52001 -4805
E -mail: pwagner @cityofdubuque.org
Telephone: 563.589.4393
Facsimile: 563.589.1733
Each such notice, request or other communication shall be effective (i) if given by facsimile, when such
facsimile is transmitted to the facsimile number specified in this Article and a confirmation of such
facsimile has been received by the sender, (ii) if given by e -mail, when such e -mail is transmitted to the e-
mail address specified in this Article and a confirmation of such e -mail has been received by the sender,
(iii) if given by mail, five (5) days after such communication is deposited in the mail, certified or
registered with return receipt requested, addressed as aforesaid or (iv) if given by any other means, when
delivered at the addresses specified in this Article.
10.4 Headings. Article headings used in this Contract are for convenience of reference only and are
not a part of this Contract for any other purpose.
10.5 Final Authority. The IEDA shall have the authority to reasonably assess whether the Recipient
has complied with the terms of this Contract. Any IEDA determinations with respect to compliance with
the provisions of this Contract shall be deemed to be final determinations pursuant to Iowa Code Chapter
17A, Iowa Administrative Procedure Act.
10.6 Waivers. No waiver by IEDA of any default hereunder shall operate as a waiver of any other
default or of the same default on any future occasion. No delay on the part of the IEDA in exercising any
right or remedy hereunder shall operate as a waiver thereof. No single or partial exercise of any right or
remedy by IEDA shall preclude future exercise thereof or the exercise of any other right or remedy.
10.7 Counterparts. This Contract may be executed in any number of counterparts, each of which shall
be deemed to be an original, but all of which together shall constitute but one and the same instrument.
10.8 Survival of Representations. All representations and warranties made herein or in any other
Contract document or in certificates given pursuant hereto or thereto shall survive the execution and
delivery of this Contract and the other Contract documents and shall continue in full force and effect with
respect to the date as of which they were made until all of Recipient's obligations or liabilities under this
Contract have been satisfied.
10.9 Severability of Provisions. Any provision of this Contract which is unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such unenforceability without
invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in
any other jurisdiction. All rights, remedies and powers provided in this Contract or any other Contract
document may be exercised only to the extent that the exercise thereof does not violate any applicable
mandatory provisions of law, and all the provisions of this Contract and any other Contract document are
intended to be subject to all applicable mandatory provisions of law which may be controlling and to be
limited to the extent necessary so that they will not render this Contract or any other Contract document
invalid or unenforceable.
10.10 Successors and Assigns. This Contract shall be binding upon the Recipient and its respective
successors and assigns, and shall inure to the benefit of the IEDA and the benefit of their respective
successors and assigns.
10.11 Nonassignment. This Contract shall not be assigned, in whole or in part, by Recipient unless
approved in writing by IEDA.
Contract# 14 -TC -011 - 20 -
Fm! Approved 11/12
10.12 Termination. This Contract can be terminated under each of the following circumstances:
(a) Agreement of the Parties. Upon written agreement of the Recipient, the Community and IEDA.
(b) Unremedied Event of Default. As a result of the Recipient's or Community's unremedied Event
of Default pursuant to Article 9.
(c) Termination or reduction in funding to IEDA. As a result of the termination or reduction of
funding to IEDA as provided in Article 4.4(c).
10.13 Documents Incorporated by Reference. The following documents are incorporated by
reference and considered an integral part of this Contract:
1. Exhibit A -
2. Exhibit B -2
Recipient's Financial Assistance Application (on file with IEDA),
Application # 14 -HQJTC -008
High - Quality Jobs Program — Tax Credit Component Special Conditions
3. Exhibit C - Description of the Project and Award Budget
4. Exhibit D - Job Obligations
5. Exhibit E- Reserved
6. Exhibit F - Reserved
10.14 Order of Priority. In the case of any inconsistency or conflict between the specific provisions of
this document and the exhibits, the following order of priority shall control:
1. Article 1 - 10 of this Contract.
2. Exhibit A -
3. Exhibit B -2
Recipient's Financial Assistance Application (on file with IEDA),
Application # 14 -HQJTC -008
High - Quality Jobs Program — Tax Credit Component Special Conditions
4. Exhibit C - Description of the Project and Award Budget
5. Exhibit D - Job Obligations
6. Exhibit E - Reserved
7. Exhibit F - Reserved
10.15 Integration. This Contract contains the entire understanding between the Parties relating to the
Project and any representations that may have been made before or after the signing of this Contract,
which are not contained herein, are nonbinding, void and of no effect. None of the Parties have relied on
any such prior representation in entering into this Contract.
Contract # 14 -TC -011 - 21 -
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IN WITNESS WHEREOF in consideration of the mutual covenants set forth above and for other
good and valuable consideration, the receipt, adequacy and legal sufficiency of which are hereby
acknowledged, the parties have entered into this Contract and have caused their duly authorized
representatives to execute this Contract, effective as of the latest date stated below (Contract Effective
Date).
FOR IEDA:
BY:
Deborah V. Durham, Director
Date
FOR THE C4JMMUNITY:
BY:
S,
Signature
Roy D. Buolt Mayor
Typed Name and Title
12/16/13
Date
Contract # 14 -TC -011 -22 -
FOR RECIPIENT:
BY:
W
Signature —
a)/linibia MalikelL
Typed Name &id Title
Date
Fmt Approved 11/12
LIST OF EXHIBITS
Exhibit A - Recipient's Financial Assistance Application (on file with IEDA), Application #14-
HQJTC -008
Exhibit 13-2 High Quality Jobs Program — Tax Credit Component Special Conditions
Exhibit C - Description of the Project and Award Budget
Exhibit D - Job Obligations
Exhibit E - Reserved
Exhibit F - Reserved
Contract # 14 -TC -011 - 23 -
FmJApproved 11/12
EXHIBIT B — 2
High Quality Jobs Program — Tax Credit Component
Special Conditions to Contract # 14 -TC -011
The following additional terms shall apply to the Contract:
SECTION 1: ADDITIONAL DEFINITIONS.
The following additional terms are defined in this Contract as follows:
"Capital Investment" means the investment spent on depreciable assets. The minimum Capital
Investment required for this Project is as stated in Section 2 of this Exhibit. The allowable categories of
expenditures for purposes of calculating Capital Investment are described in IEDA's administrative rule
261 IAC 174.10.
"Investment Qualifying for the Tax Credit" means new investment directly related to jobs created or
retained by the start-up, location, expansion or modernization for this Project. Not all of the expenditure
categories used to calculate the `Investment Qualifying for the Tax Credit" are included for purposes of
claiming the tax credits. The allowable categories of expenditures for purposes of claiming the tax
benefits are described in IEDA's administrative rule 261 IAC 174.10.
"Qualifying Investment" means the statutorily- required minimum investment amount that must be
met and maintained by the Recipient to receive High Quality Jobs Program tax benefits for this Project.
This amount is as stated in Section 2 of this Exhibit. Not all expenditures count toward meeting the
required Qualifying Investment. The categories of expenditures that can be included for purposes of
meeting and maintaining statutorily - required investment requirements are described in IEDA's
administrative rule 261 IAC 174.10.
"Economically Distressed Area" means a county that ranks among the bottom 25 of all Iowa
counties, as measured by either the average monthly unemployment level for the most recent 12 -month
period or the average annualized unemployment level for the most recent five -year period.
SECTION 2: TERMS AND CONDITIONS OF THE AWARD
2.1 Award. The Recipient is awarded the following Tax Benefits through the High Quality Jobs
Program, based on the minimal investment requirements described herein: $146,400.
2.2 Minimum Investment Requirements. As a condition of receiving Tax Benefits, the Recipient
shall meet the following minimum investment requirements:
(a) Capital Investment. $ 3,730,000
(b) Qualifying Investment for Tax Credit Program. $ 3,730,000
(c) Investment Qualifying for Tax Credits. $ 3,720,000
2.3 Additional Tax Benefits. The Recipient is eligible for additional incentives pursuant to Iowa
Code sections 15.326, et. seq. pursuant to its participation in the High Quality Jobs Program and its
obligations and rights under the Contract. The following Tax Benefits, in the maximum amounts shown
for each authorized benefit, are so available to the Recipient:
Contract # 14 -TC -011
Exhibit B -2, Page 1 Fmt Update 11/12
Authorized Benefits
Included in Award
Maximum Amt.
Refund of Sales, Service, and Use Taxes.
$ 72,000
0 Yes
❑ No
Refund of Sales Taxes Attributable to Racks, Shelving,
and Conveyor Equipment.
❑ Yes
$ 0
►1 No
Corporate Tax Credit For Certain Sales Taxes Paid By
Third Party Developer.
❑ Yes
$ 0
■ No
Investment Tax Credit (2 %)
$ 74,400
■ Yes
❑ No
Research Activities Credit.
❑ Yes
$ 0
/1 No
Local Property Tax Exemption Provided by Community
❑ Yes
$ 0
a No
2.4 Conditions for Authorized Benefits. The Recipient is responsible to seek these additional
benefits through processes described in the applicable statues and corresponding administrative rules,
ordinances and procedures. The following conditions shall apply to the benefits described in section 2.3
of this Exhibit.
(a) Refund Of Sales, Service And Use Taxes Paid To Contractors Or Subcontractors. The Recipient
is eligible for a refund of sales, service and use taxes paid to contractors and subcontractors as authorized
in Iowa Code section 15.331A (2011 Supplement).
1. The Recipient may apply for a refund of the sales and use taxes paid under Iowa Code
chapters 422 and 423 for gas, electricity, water or sewer utility services, goods, wares, or
merchandise, or on services rendered, furnished, or performed to or for a contractor or
subcontractor and used in the fulfillment of a written contract relating to the construction or
equipping of a facility of the Recipient.
2. Taxes attributable to intangible property and furniture and furnishings shall not be refunded.
3. To receive a refund of the sales, service and use taxes paid to contractors or subcontractors,
the Recipient must:
(b) Reserved.
(c) Reserved.
Contract # 14 -TC -011
Inform the Iowa Department of Revenue (IDR) in writing within two weeks of
project completion. For purposes of claiming this refund, "project completion"
means the first date upon which the average annualized production of finished
product for the preceding ninety -day period at the manufacturing facility
operated by the Recipient is at least fifty percent of the initial design capacity of
the facility.
ii. Within one year after Project Completion, as defined in sub - paragraph i above,
make an application to the Department Revenue.
Exhibit B -2, Page 2 Fmt Update 11/12
(d) Investment Tax Credit.
1. The Recipient may claim an investment tax credit as provided in Iowa Code section 15.333.
Such credit may be claimed for a portion of the Qualifying Expenditures, as defined below in
subparagraph (iii), directly related to job obligations, as described in Exhibit D, of the start -up,
or location, expansion, or modernization of the business under this program. The Recipient
shall not claim more than the amount authorized for this benefit as stated above and in Article
2.2(b). The credit is to be taken in the year the qualifying asset is placed in service. Any credit
in excess of the tax liability for the tax year may be credited to the tax liability for the
following seven years or until depleted, whichever occurs first.
2. The tax credit shall be amortized equally over a five -year
July 1, 2013 — June 30, 2014
$ 14,880
July 1, 2014 — June 30, 2015
$ 14,880
July 1, 2015 — June 30, 2016
$ 14,880
July 1, 2016 — June 30, 2017
$ 14,880
July 1, 2017 — June 30, 2018
$ 14,880
3. Only Qualifying Expenditures are eligible for the investment tax credit. For purposes of this
benefit, "Qualifying Expenditures" means:
i. The purchase price of real property and any buildings and structures located on
the real property.
ii. The cost of improvements made to real property which is used in operation of the
business.
iii. The costs of machinery and equipment, as defined in Iowa Code section
427A.1(1) "e" and "j," purchased for use in the operation of the business and
which the purchase price may have been depreciated in accordance with GAAP.
4. If the Project includes leasing of new construction or major renovation of an existing
building, the annual base rent paid to a third -party developer by a Recipient must be for a
period equal to the term of the lease agreement but not to exceed the maximum term of the
agreement, provided the cumulative cost of the base rent payments for that period does not
exceed the cost of the land the third -party developer's costs to build or renovate the building
for the Recipient. Limitations to annual base rent shall only be considered when the Project
includes the construction of a new building or the major renovation of an existing building.
The Recipient shall enter into a lease agreement with the third -party developer for a
minimum of five years.
(e) Reserved.
(f) Reserved.
SECTION 3: ADDITIONAL COVENANTS
In addition to the Covenants described in Article 7 of the Contract, the Recipient shall be bound to the
additional covenants:
Contract # 14 -TC -011
Exhibit B -2, Page 3 Fmt Update 11/12
3.1 Job Obligations. By the Project Completion Date, the Recipient shall create and /or retain the
number of FTE Created Jobs and Retained Jobs included in, for Retained Jobs, and above, for Created
Jobs, the Recipient's Employment Base, as detailed in Exhibit D — Job Obligations, and maintain the jobs
through the Maintenance Period.
3.2 Wage Obligations. The Qualifying Wage Threshold rates specific to this Contract that must be
met are stated in Exhibit D, Job Obligations. By the Project Completion Date and through the
Maintenance Completion Period Date, the Recipient shall:
(a) For the Created Jobs, pay 100% of the Qualifying Wage Threshold at the start of the Project
Completion Period, at least 120% of the Qualifying Wage Threshold by the Project Completion Date, and
at least 120% of the Qualifying Wage Threshold until the Maintenance Period Completion Date.
(b) For the Retained Jobs, pay at least 120% of the Qualifying Wage Threshold throughout both the
Project Completion Period and the Maintenance Period
(c) For projects in Economically Distressed Areas the Qualifying Wage Threshold requirement
applicable to all phases of the project is 100% of the Qualifying Wage Threshold if the eligible business is
located in an economically distressed area.
3.3 Provide Sufficient Benefits. The Recipient shall provide all employees included as part of the
job and wage obligations with Sufficient Benefits.
SECTION 4: ADDITIONAL DEFAULT PROVISIONS
In addition to the default provisions included in Article 9 of the Contract, the following additional default
provisions shall apply:
4.1 Repayment of Tax Benefits Received - High Quality Jobs Program. IDR is the state agency
responsible for collecting the value of any Tax Benefits received in violation of the terms of this Contract.
The Community is the party responsible for collecting the value of the local tax benefits received in
violation of this Contract. IEDA will determine if the Recipient has met the terms of this Contract. If there
is an unremedied Event of Default, IEDA will provide written notice to IDR and the Community.
Calculation of the amount owed may be based on a sliding scale in certain circumstances and may include
interest assessed by IDR. Those circumstances are as follows:
(a) Failure to Meet Job Obligations by Project Completion Date. If the Recipient does not meet its
Job Obligations as detailed in Exhibit D, Job Obligations by the Project Completion Date, Recipient shall
repay a percentage of the Tax Benefits it has received. The repayment percentage will be equal to the
percentage of jobs short of its Job Obligations.
The percentage to be repaid is calculated based on the number of jobs that are at or above the Qualifying
Wage Threshold. For example, if the Recipient meets 90% of its Job Obligations, the amount to be repaid
is 10% of the value of Tax Benefits taken (plus any interest assessed by IDR).
Upon repayment of the amount due, IEDA will reduce the Recipient's Employment Base. This reduced
employment base must be maintained through the Maintenance Period Completion Date.
(b) Job shortfall at Maintenance Period Completion Date. If the Recipient does not maintain its
adjusted Employment Base through the Maintenance Period Completion Date, Recipient shall repay an
Contract # 14 -TC -011
Exhibit B -2, Page 4 Fmt Update 11/12
additional percentage of the Tax Benefits it has received. The repayment percentage will be equal to the
percentage of jobs that the Recipient failed to maintain. The amount to be repaid will be calculated as
described in subsection (a) above.
(c) Less than Total Project Cost at Project Completion Date. If the Recipient does not complete the
Project with a Total Project Cost as stated in Exhibit C, Project Description and Award Budget, by the
Project Completion Date Recipient shall repay a portion of the Tax Benefits received.
For example, if the Recipient's required Total Project Cost is 10% less than pledged, 10% of the value of
the tax benefits received (plus any interest assessed by IDR) must be repaid.
(d) Repayment Amount If Both Shortfall in Job Obligations and Less Than Total Project Cost. If the
Recipient experiences a shortfall in its Job Obligations and the Total Project Cost is less than required,
IEDA will calculate the percentage owing for the job shortfall and for less than the Total Project Cost.
The higher of these two amounts shall be the amount Recipient shall repay to IDR.
(e) Selling, Disposing, or Razing of Property. If, within five years of purchase, the Recipient sells,
disposes of, razes, or otherwise renders unusable all or a part of the land, building, or other existing
structures for which an investment tax credit was claimed, the income tax liability of the Recipient for the
year in which all or part of the property is sold, disposed of, razed, or otherwise rendered unusable shall
be increased by one of the following amounts plus any interest assessed by IDR:
1 100% of the tax credit claimed if the property ceases to be approved for the tax credit within
one full year after being placed in service.
2. 80% of the tax credit claimed if the property ceases to be approved for the tax credit within
two full years after being placed in service.
3. 60% of the tax credit claimed if the property ceases to be approved for the tax credit within
three full years after being placed in service.
4. 40% of the tax credit claimed if the property ceases to be approved for the tax credit within
four full years after being placed in service.
5. 20% of the tax credit claimed if the property ceases to be approved for the tax credit within
five full years after being placed in service.
(f) Qualifying Investment. If the Business does not meet its Qualifying Investment requirement as
defined in Section 2 of this Exhibit, Recipient shall repay all or a portion of the value of Tax Benefits
received. Repayment shall be calculated as follows plus any interest assessed by IDR:
1. If the Recipient has met 50 percent or less of the Qualifying Investment requirement,
Recipient shall repay the same percentage in Tax Benefits as the Recipient failed to invest.
2. If the Recipient has met more than 50 percent but not more than 75 percent of the Qualifying
Investment requirement, the Recipient shall repay one -half of the percentage in Tax Benefits
as the Recipient failed to invest.
Contract # 14 -TC -011
Exhibit B -2, Page 5 Fad Update 11/12
3. If the Recipient has met more than 75 percent but not more than 90 percent of the Qualifying
Investment requirement, the Recipient shall repay one - quarter of the percentage in benefits as
the Recipient failed to invest.
Contract # 14 -TC -011
- End of Exhibit B — 2 -
Exhibit B -2, Page 6 Fmt Update 11/12
DESCRIPTION OF THE PROJECT AND AWARD BUDGET
(EXHIBIT C)
Name of Recipient:
Name of Community:
Contract Number:
TriState Quality Metals, LLC
City of Dubuque
14 -TC -011
PROJECT DESCRIPTION
TriState Quality Metals, LLC will relocate from Peosta to Dubuque to expand their rapidly growing operation by building a new
40,000 s.f. production facility.
AWARD BUDGET
SOURCE OF FUNDS
AMOUNT
FORM
USE OF FUNDS
COST
IEDA Programs
10 yr property tax refund
Yes
*Land Acquisition
$300,000
HQJP Tax Credit
'See Below
*Site Preparation
No
In -Kind Contributions
*Building Acquisition
TriState Quality Metals, LLC
$423,000
Cash /Equity
*Building Construction
$2,400,000
Bank /SBA Financing
$3,357,000
Loan
*Building Remodeling
Lease Payments
*Mfg Machinery and Equipment
$1,000,000
Other Machinery and Equipment
Racking, Shelving, etc.
*Computer Hardware
$20,000
Computer Software
*Furniture and Fixtures
$10,000
Working Capital
Research and Development
Job Training
Relocation Costs
*included as capital investment if
awarded tax credit program
$50,000
Total
$3,780,000
Total
$3,780,000
lm, I
400 estimated benefit value
OTHER FUNDING
SOURCE OF FUNDS
TOTAL AMOUNT
FORM /TERM
USED AS MATCH
TIF
$580,000
10 yr property tax refund
Yes
Tax Abatement
260E Job Training
$48,000
No
In -Kind Contributions
RISE
RED
Other
EXHIBIT D — JOB OBLIGATIONS
Recipient: TriState Quality Metals, LLC
Community: City of Dubuque
Contract Number: 14 -TC -011
This Project has been awarded benefits from the High Quality Jobs Program (HQJP) — Tax Credit Component. The chart below
outline the contractual job obligations related to this Project.
Data in the "Employment Base" column has been verified by the Authority and reflects the employment characteristics of the
facility receiving funding before this award was made. Jobs to be retained as a part of this Project must be included in these
calculations.
Data in the "Jobs To Be Created" column outlines the new full -time jobs (including their wage characteristics) that must be added to
the employment base and, if applicable, statewide employment base as a result of this award.
At the Project Completion Date and through the Maintenance Period Completion Date, the Business must achieve (at a minimum)
the numbers found in the "Total Job Obligations" column.
HQJTC JOB OBLIGATIONS
Project Completion Date: October 1, 2016.
Maintenance Period Completion Date: October 1, 2018
Total employment at project location
Average wage of total employment at project location
Qualifying Laborshed Wage threshold requirement (per hr)
12
10
$20.72
$19.73
Number of jobs at or above qualifying wage
Average Wage of jobs at or above qualifying wage
5
22
1
$27.83
6
Notes re: Qualifying Wages
1. Bonus or commission payments are not included when calculating the Qualifying Wage rate.
2. Employment Base includes no "Retained Jobs ".
3. If the Recipient uses or proposes to use a non - standard work week (8 hours a day, 5 days a
week, 52 weeks a year including holidays, vacation and other paid leave), check the box below
and describe that alternative schedule. The alternative schedule must meet the requirements of
261 IAC 173.2.) By not checking the box and not providing the alternative schedule, IEDA
will consider "Full -time Equivalent (FTE) Job" to mean the employment of one person for 8
hours per day for a 5 -day, 40 -hour workweek for 52 weeks per year, including paid holidays,
vacations and other paid leave.
El The Recipient shall use an alternative work week for purposes of its employees described in
the Contract. The alternative work week is as follows: [description].
Fmt. Approved 11/09