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HomeMy WebLinkAboutGrand Investments, LLC-4/7/2014Mayor BUCK CLARK COUNCIL MEMBERS DAVID JONES Ward 1 CAROLYN COLE Ward 2 HAROLD GETTY Ward 3 QUENTIN HART Ward 4 RON WELPER Ward 5 BOB GREENWOOD At -Large STEVE SCHMITT At -Large CITY •F WATE L IOWA COMMUNITY PLANNING AND DEVELOPMENT 715 Mulberry Street • Waterloo, Iowa 50703-5783 • (319) 291-4366 Fax (319) 291-4262 NOEL C. ANDERSON, Community Planning & Deyelopmenr Director Rescheduled to April 7, 2014 CITY OF WATERLOO Council Communication City Council Meeting: March 10, 2014 Prepared: March 5, 2014 Dept. Head Signature: Noel Anderson, Community Planning & Development Director # of Attachments: 1 SUBJECT: Request to set a date of public hearing as March 24, 2014 to enter into a Master Development Agreement and Supplemental Development Agreement with Grand Investments, LLC to authorize the sale and conveyance of a portion of City owned property for $1.00 commonly known as the former Grand Hotel site, at West Mullan Avenue and Jefferson Street, for the construction of an approximate 70 -unit condominium development with an estimated actual value of $6 million, with 20 years at 42% tax rebates. Submitted by: Noel Anderson, Community Planning & Development Director Recommended City Council Action: Approval of request Summary Statement: Transmitted herewith is a request to set a date of public hearing as March 24, 2014 to enter into a development agreement with Grand Investment, LLC (Brent Dahlstrom) to authorize the sale and conveyance of City owned property for $1.00, formerly known as the Grand Hotel site. Note — there are two development agreements — one is a Master Development Agreement setting forth three phases of development for the entire grand hotel site area, including the potential acquisition of IDOT land. This agreement would allow Grand Investments, LLC the security for future design work, future planning, and future work towards securing tenants and financing for the next two phases of development, as long as they meet the timeline of phased development. The second agreement deals specifically with the Phase I development, and similar Supplemental Agreements would be accompanied with each phase of development to allow the City Council to review and approve each specific design and use of each development phase. The property in question was acquired due to the dilapidated and flood -damaged state of the former Grand Hotel for future redevelopment. This project would be in accordance with that redevelopment goal, and in accordance with the Downtown Master Plan for bringing additional residential opportunities to Downtown Waterloo. The site will need to be rezoned for development to occur. CITY WEBSITE: www.ci.waterloo.ia.us WE'RE WORKING FOR YOU! An Equal Opportunity/Affirmative Action Employer The phases of development are spread out to allow a first phase to be completed, and time for a second phase to be designed, and then a third. There are some State Enterprise Zone incentives (tax credits) that are a part of this project as well, that are being finalized to fully determine its start date. There are also brownfield tax credits from the State of Iowa to help this project as well. Therefore, we would ask that the City Council set a date of public hearing, and publish and official notice pertinent to the request to sell and convey the area described herein. Expenditure Required. None Source of Funds: N/A Policy Issue: Sale of City Property and Economic Development Alternative: Background Information: The City of Waterloo has been working to actively gain new multi -story residential developments in and near Downtown Waterloo to bring more residents, visitors, and attractions to Downtown Waterloo. This Development Agreement is structured similar to the Development Agreement that was offer to the Sherman project on the riverfront, in terms of multi -phases, tax incentives, and sale of property. The City acquired the site for $800,000 and demolished the building upon the site. The Phase I project, would still pay an estimated $73,080 per year in taxes, with additional phases to follow. Cc: Jim Walsh, City Atomey Aric Schroeder, City Planner —file— BEECHER, FIELD, WALKER, MORRIS, HOFFMAN & JOHNSON, P.C. HUGH M. MELD JOHN R. WALKER, JR. RICHARD R. MORRIS THERESA E. HOFFMAN ERIC W. JOHNSON KEVIN D. AHRENHOLZ D. RAYMOND WALTON JOHN J. WOOD ADNAN MAHMUTAGIC COREY R. LORENZEN KATE B. MITCHELL KIRSTEN N. ARNOLD S 1 EPHEN P. SKRAM LAWYERS COURT SQUARE BUILDING - SUITE 300 620 LAFAYE 1 1 b STREET P.O. BOX I78 WATERLOO, IOWA 50704 TELEPHONE: (319) 234-1766 FAX: (319) 234-I225 ewj i beecherlaw.com www.wcllawyer.com February 27, Noel Anderson Community Planning & Development Director 715 Mulberry Street Waterloo, IA 50703 Re: Devi Investments, I Dear Noel: Enclosed you will find three original and executec original and executed Supplemental Development Agreemen and concerning the property for the former location of the Grand Hotel, located on West Mullan and Westfield Avenues, Waterloo, IA. Awl g W. LOUIS BEECHER (192I -20I2) W.L. BEECHER (I89I-1976) JOHN W. RATHERT (1932-2010) BRANCH OFFICE BY APPOINTMENT 508 N.HWY2I8 LA PORTE CITY, IOWA 50651 TELEPHONE: 319-342-4095 Once the Agreements have been executed by the City of Waterloo, please promptly provide us with one original for our file. If you have any questions or wish to discuss the enclosed, please give me a call. Thank you. EWJ/bjm Enclosures nc . Johnson for : ECHER, FIELD, WALKER, MO ' S, HOFFMAN & JOHNSON, P.C. ♦Established in 1918+ Preparer Information: Christopher S. Wendland, PO Box 596, Waterloo, Iowa 50704 (319) 234-5701 Name Address City Phone MASTER DEVELOPMENT AGREEMENT Aped t iy This Master Development Agreement (the "Agreement") is entered into as of February 27, 2014, 2014 by and between Grand Investments, LLC (the "Company") and the City of Waterloo, Iowa (the "City"). Brent Dahlstrom is a principal of Company and executes the personal guaranty at the end of this Agreement for the purposes stated therein. RECITALS A. City considers economic development within the City a benefit to the community and is willing for the overall good and welfare of the community to provide financial incentives so as to encourage that goal. Company is willing and able to finance and construct buildings and related improvements on property located in the Downtown Urban Renewal and Redevelopment Plan area, generally located on the southwesterly side of Jefferson Street, bounded by W. MuIlan Avenue and Westfield Avenue, and legally described on Exhibit "A" attached hereto (the "Property"). AGREEMENT NOW, THEREFORE, in consideration of the mutual covenants set forth herein, the parties agree as follows: 1. Phased Development. The parties contemplate that Company will develop the Property in phases corresponding to the specific lots as generally depicted on Exhibit "B" attached hereto. Each phase is generally described as follows, although more detailed plans for each phase will be developed at one or more future dates: A. Phase 1. An apartment building consisting of j_ above -ground floors and not less than („6 units comprising t;0T- total square feet, and related parking, landscaping, and other improvements. Phase 1 improvements will be located upon the area shown as "Lot 1" on Exhibit "B." DEVELOPMENT AGREEMENT Page 2 B. Phase 2. A mixed-use commercial building consisting of not less than square feet, and related parking, landscaping and other improvements. Phase 2 improvements will be located upon the area shown as "Lot 2" on Exhibit "B." C. Phase 3. Plans have yet to be developed for the area shown as "Lot 3" on Exhibit "B." In connection with each separate phase, Company and City agree to enter a development agreement supplemental to this Agreement and to enter into a minimum assessment agreement as described in Section 13 below. City may require that Company submit specific building designs and site plans for City review and approval as a condition to approval of a supplemental development agreement applicable to a given phase. Improvements to the Property completed within the schedule established by Section 4 below will be eligible for the benefits provided for in this Agreement, and any part of the Improvements not completed within the prescribed period will not be eligible for said benefits. 2. Sale of Property; Title. Subject to the terms hereof, City shall convey the Property, or cause it to be conveyed, to Company in separate transactions on a phase - by -phase basis as set forth herein, for the sum of $1.00 (the "Purchase Price") for that part of the Property subject to each phase (each a "Phase Area"). Conveyance shall be by quit claim deed, free and clear of all encumbrances arising by or through City except: (a) easements, conditions and restrictions of record which do not, in Company's opinion, interfere with Company's proposed use; (b) current and future real estate real property taxes and assessments subject to the agreements made herein; (c) general utility and right-of-way easements serving the Property; and (d) restrictions imposed by City zoning ordinances and other applicable law. City shall have no duty to convey title to Company until Company delivers to City reasonable and satisfactory proof of financial ability to undertake and carry on the next phase of the Project (defined below), which may take the form of a lending commitment letter. Company shall, at its own expense, prepare an updated abstract of title, or in lieu thereof Company may, at its own expense, obtain whatever form of title evidence it desires. If title is unmarketable or subject to matters not acceptable to Company, and if City does not remedy or remove such objectionable matters in timely fashion following written notice of such objections from Company, Company may terminate this Agreement. City shall provide any title documents it currently has in its possession, including any abstracts, to assist in title preparation. Company shall, at its sole expense, undertake all work of surveying necessary to subdivide the Property into distinct Phase Areas, and all other survey or platting work necessary or desirable for Company's Project purposes. 3. Improvements by Company. Company shall construct on each Phase Area the improvements described in Section 1 above, including related parking, landscape, and other improvement to the buildings and grounds (collectively, the "Improvements"). Parking for each phase of Improvements shall meet City's minimum requirements based on building use, occupancy, and future intended development on the Property. The Improvements shall be constructed in accordance with all applicable DEVELOPMENT AGREEMENT Page 3 City, state, and federal building codes and shall comply with all applicable City ordinances and other applicable law. It is contemplated that the Improvements for a given phase will have a cost as set forth in the supplemental development agreement applicable to that phase. The Property, the Improvements, and all site preparation and development -related work to make the Property usable for Company's purposes as contemplated by this Agreement are collectively referred to as the "Project". 4. Timeliness of Conveyance and Construction; Possibility of Reverter. The parties agree that Company's commitment to undertake the Project and to construct the Improvements in a timely manner constitutes a material inducement for the City to convey the Property, or to cause the Property to be conveyed, to Company and that without said commitment City would not do so. A. Deadlines to commence and complete. Subject to the terms of this Agreement, Company may request conveyance of a Phase Area at any time before the following deadlines: Phase 1 conveyance deadline: November 30, 2014 Phase 2 conveyance deadline: November 30, 2017 Phase 3 conveyance deadline: November 30, 2020 Construction of Improvements for each phase must begin within the time set forth in this paragraph, or Company's right to acquire any Phase Area not yet conveyed to Company will expire. Measured from the date that any Phase Area is deeded to Company, Company must obtain a building permit and begin construction on the corresponding phase within nine (9) months. Construction of each phase shall be completed within twelve (12) months of its commencement. B. Events triggering reverter of title. (i) If Company has not, in good faith, begun the construction of any phase of the Improvements on said schedule, then title to the applicable Phase Area shall revert to the City, except as provided in this Agreement; provided, however, that if construction has not begun at the end of any phase commencement period but the development of the Project is still imminent, the City Council may, but shall not be required to, consent to an extension of time for the construction of the Improvements, and if an extension is granted but construction of the Improvements has not begun within such extended period, then the title to the applicable Phase Area shall revert to the City after the end of said extended period. (ii) If Company determines at any time that the Project is not economically feasible, then after giving thirty (30) days' advance written notice to City, Company may convey the applicable Phase Area(s) to City by special warranty deed, free and clear of any lien, claim, or encumbrance arising by or through Company, and thereupon neither party shall have any further obligation under this Agreement except as DEVELOPMENT AGREEMENT . Page 4 expressly provided. In connection with any conveyance to City, Company shall pay in full, so as to discharge or satisfy, all liens, claims, charges, and encumbrances on or against the Property or any Phase Area. (iii) If development has commenced within the required period or any extended period and is stopped and/or delayed as a result of an act of God, war, civil disturbance, court order, labor dispute, fire, or other cause beyond the reasonable control of Company, the requirement that construction of any phase or of the entire Project shall be tolled for a period of time equal to the period of such stoppage or delay, and thereafter if construction is not completed within the allowed period of extension then title to the Phase Area(s) shall revert to the City. C. Extension of time. The parties acknowledge that Company may apply to the Iowa Economic Development Authority ("IEDA") to obtain for Enterprise Zone credits for one or more phases of the Project. As to any Project phase for which such an application is timely filed and diligently pursued to completion by Company, the deadline for completion of construction of such phase will be extended to account for any delays in IDEA's processing of Company's credit application. 5. Regulatory Approvals. Company acknowledges and agrees that the Project will require Company to obtain various approvals from the City of Waterloo and/or other applicable governmental authorities, including but not limited to zoning, site plan, subdivision, building permit and other approvals required or necessary for Company's proposed Improvements to the Property. To optimize coordination of Project plans and development with such approvals, Company agrees to participate regularly and in good faith in the project management/design-build management (PMT/DBMT) process applicable to the Property for design issues, landscape design, parking, construction documents, and other matters. 6. Platting and Release. Company may, in consultation with City, plat the Property or Phase Areas if reasonably necessary for purposes of the Project, at Company's sole expense. In connection with any sale by Company of that part of the Property corresponding with a completed phase of Improvements, City agrees to release such part of the Property from the conditions and restrictions set forth in this Agreement. A release of any such part of the Property shall not affect the continued effectiveness and enforceability of this Agreement as to any part of the Property that is not specifically released. 7. Easements. Company agrees, at its sole expense, to prepare and record one or more documents to create easements for the benefit of the Phase 2 and Phase 3 areas, allowing pedestrian and vehicular ingress and egress upon and across the Phase 1 area, and to designate a portion of the Phase 1 area as joint -use parking with the occupants and patrons of the Phase 2 and Phase 3 areas, generally as shown on Exhibit "B" attached hereto with the specific location and dimensions to be determined DEVELOPMENT AGREEMENT Page 5 by later instrument. Each such document shall be submitted to City for review and approval before recording. 8. Reverter of Title; Indemnity. Title shall not revert to City as to any phase of Improvements that has been substantially completed. In the event of any reverter of title, Company agrees that it shall, at its own expense, promptly execute all documents, including but not limited to a special warranty deed, or take such other actions as the City may reasonably request to effectuate said reverter and to deliver to City title to the Property that is free and clear of any lien, claim, or encumbrance arising by or through Company. Company shall pay in full, so as to discharge or satisfy, all liens, claims, charges, and encumbrances on or against the Property or any portion thereof. If Company fails to deliver such documents, including but not limited to a special warranty deed, to City within thirty (30) days of written demand by City, then City shall be authorized to execute, on Company's behalf and as its attorney-in-fact, the special warranty deed required by this Section, and for such limited purpose Company does hereby constitute and appoint City as its attorney-in-fact. Company further agrees that it shall indemnify City and hold it harmless with respect to any demand, claim, cause of action, damage, or injury made, suffered, or incurred as a result of or in connection with the Project, Company's failure to carry on or complete same, or any lien, claim, charge, or encumbrance on or against the Property or any Phase Area of any type or nature whatsoever that attaches to the Property or a Phase Area by virtue of Company's ownership of same. If City files suit to enforce the terms of this Agreement and prevails in such suit, then Company shall be liable for all legal expenses, including but not limited to reasonable attorneys' fees. Company's duties of indemnity pursuant to this Section shall survive the expiration, termination or cancellation of this Agreement for any reason. 9. No Encumbrances; Limited Exception. Until completion of the Improvements, Company agrees that it shall not create, incur, or suffer to exist any lien, encumbrance, mortgage, security interest, or charge on the Property or any Phase Area, other than such mortgage or mortgages as may be reasonably necessary to finance Company's completion of the Improvements and of which Company notifies City in advance of Company's execution of any such mortgage. Company may not mortgage the Property or any Phase Area for any purpose except in connection with financing of the Improvements. 10. Bonds. Reserved. 11. Utilities. Company will be responsible for extending water, sewer, telephone, telecommunications, electric, gas and other utility services to any location on the Property and for payment of any associated connection fees. DEVELOPMENT AGREEMENT , Page 6 12. City Activities in Aid of Project. A. Rebates. City shall provide property tax rebates as further set forth in Section 14 below. B. Acquisition of Property. The parties acknowledge that the Phase Area identified as Lot 3 on Exhibit "B" is currently owned by the State of Iowa or another state agency. City agrees to make reasonable efforts to acquire said property from the current owner(s) thereof within 24 months of City's conveyance of the Phase 2 area to Company. C. Tax credit assistance. City agrees to support Company's applications for enterprise zone credits and brownfield/grayfield tax credits and to assist Company in making application for such credits. 13. Minimum Assessment Agreement. Company acknowledges and agrees that it will pay when due all taxes and assessments, general or special, and all other charges whatsoever levied upon or assessed or placed against any portion of the Property conveyed to Company hereunder. In connection with each phase of Improvements, and as a condition to receiving the benefits provided for in this Agreement, Company agrees to execute a minimum assessment agreement substantially in the form attached hereto as Exhibit "C." Company further agrees that prior to the date set forth in Section 2 of such minimum assessment agreement it will not seek or cause a reduction in the taxable valuation for the Property, which shall be fixed for assessment purposes, below the amount stated in the minimum assessment agreement applicable to a given phase (the "Minimum Actual Value"), through: either; (i) willful destruction of the Property, the Improvements, or any part of (ii) a request to the assessor of Black Hawk County; or (iii) any proceedings, whether administrative, legal, or equitable, with any administrative body or court within the City, Black Hawk County, the State of Iowa, or the federal government. 14. Tax Rebates. For each Phase Area, provided that Company has completed the Improvements as set forth herein and has executed a minimum assessment agreement as set forth in Section 14, City agrees to rebate property tax (with the exceptions noted below) as follows: Year One through Year Twenty 42% rebate each year for any taxable value over the January 1, 2013 value. The taxable value of the Property as of January 1, 2013 is $201,140.00, which will be allocated proportionately to each Phase Area, based on square footage of the Phase Area, in the applicable supplemental development agreement as the Phase Areas become more clearly DEVELOPMENT AGREEMENT Page 7 identified. Rebates are payable in respect of a given year only to the extent that Company has actually paid general property taxes due and owing for such year. To receive rebates for a given year, Company must, within twelve (12) months after the tax payment due date, submit a completed rebate request to City on the form provided by or otherwise satisfactory to City. The taxable value of the Property as a result of the Improvements must be increased by a minimum of 10% and must increase the annual tax by a minimum of $500.00. This rebate program is not applicable to any special assessment levy, debt service levy, or any other levy that is exempted from treatment as tax increment financing under the provisions of applicable law. The first year of in which a rebate may be given ("Year One") shall be the first full year for which the assessment is based upon the completed value of the Improvements in the Phase Area, and in any event not based on a prior year for which the assessment is based solely upon (x) the value of the Property or a Phase Area or upon (y) the value of the Property or a Phase Area and a partial value of the Improvements due to partial completion of the Improvements or a partial tax year. 15. Representations and Warranties of City. City hereby represents and warrants as follows: A. City is not prohibited from consummating the transaction contemplated in this Agreement by any law, regulation, agreement, instrument, restriction, order or judgment. B. Each person who executes and delivers this Agreement and all documents to be delivered hereunder is and shall be authorized to do so on behalf of City. 16. Representations and Warranties of Company. Company hereby represents and warrants as follows: A. Company is not prohibited from consummating the transaction contemplated in this Agreement by any law, regulation, agreement, instrument, restriction, order or judgment. B. Company is duly organized, validly existing, and in good standing under the laws of the state of its organization and is duly qualified and in good standing under the laws of the State of Iowa. C. Company has full right, title, and authority to execute and perform this Agreement and to consummate all of the transactions contemplated herein, and each person who executes and delivers this Agreement and all documents to be delivered to City hereunder is and shall be authorized to do so on behalf of Company. DEVELOPMENT AGREEMENT Page 8 17. Restriction on Assignment or Conveyance; Sharing of Proceeds. Company agrees that it will not sell, convey, assign or otherwise transfer, in whole or in part, to any other person or entity, its interest in any Phase Area before completion of all Improvements to be made upon such Phase Area without the prior written consent of City. Reasonable grounds for the City to withhold its consent shall include but are not limited to the inability of the proposed transferee to demonstrate to the City's satisfaction that it has the financial ability to observe all of the terms to be performed by Company under this Agreement. As a further condition to the granting of such consent, the parties agree to negotiate in good faith for Company's sharing of sale proceeds with City as partial reimbursement to City for its expenses relating to its activities in support of the Project and in assembling the Property. 18. Materiality of Company's Promises, Covenants, Representations, and Warranties. Each and every promise, covenant, representation, and warranty set forth in this Agreement on the part of Company to be performed is a material term of this Agreement, and each and every such promise, covenant, representation, and warranty constitutes a material inducement for City to enter this Agreement. Company acknowledges that without such promises, covenants, representations, and warranties, City would not have entered this Agreement. Upon breach of any promise or covenant, or in the event of the incorrectness or falsity of any representation or warranty, City may, at its sole option and in addition to any other right or remedy available to it, terminate this Agreement and declare it null and void. 19. Notices. Any notice under this Agreement shall be in writing and shall be delivered in person, by overnight air courier service, by United States registered or certified mail, postage prepaid, or by facsimile (with an additional copy delivered by one of the foregoing means), and addressed: (a) if to City, at 715 Mulberry Street, Waterloo, Iowa 50703, facsimile number 319-291-4571, Attention: Mayor, with copies to the City Attorney and the Community Planning and Development Director. (b) if to Company, to Grand Investments, LLC, 2202 College Street, Cedar Falls, IA 50613, Attention: Brent Dahlstrom, with a copy to Eric Johnson, Esq., Beecher Law Firm, 620 Lafayette Street, Waterloo, IA 50703. Delivery of notice shall be deemed to occur (i) on the date of delivery when delivered in person, (ii) one (1) business day following deposit for overnight delivery to an overnight air courier service which guarantees next day delivery, (iii) three (3) business days following the date of deposit if mailed by United States registered or certified mail, postage prepaid, or (iv) when transmitted by facsimile so long as the sender obtains written electronic confirmation from the sending facsimile machine that such transmission was successful. A party may change the address for giving notice by any method set forth in this section. 20. No Joint Venture. Nothing in this Agreement shall, or shall be deemed or construed to, create or constitute any joint venture, partnership, agency, DEVELOPMENT AGREEMENT Page 9 employment, or any other relationship between the City and Company nor to create any liability for one party with respect to the liabilities or obligations of the other party or any other person. 21. Amendment, Modification, and Waiver. No amendment, modification, or waiver of any condition, provision, or term of this Agreement shall be valid or of any effect unless made in writing, signed by the party or parties to be bound or by the duly authorized representative of same, and specifying with particularity the extent and nature of the amendment, modification, or waiver. Any waiver by any party of any default by another party shall not affect or impair any rights arising from any subsequent default. 22. Severability. Each provision, section, sentence, clause, phrase, and word of this Agreement is intended to be severable. If any portion of this Agreement shall be deemed invalid or unenforceable, whether in whole or in part, the offending provision or part thereof shall be deemed severed from this Agreement and the remaining provisions of this Agreement shall not be affected thereby and shall continue in full force and effect. If, for any reason, a court finds that any portion of this Agreement is invalid or unenforceable as written, but that by limiting such provision or portion thereof it would become valid and enforceable, then such provision or portion thereof shall be deemed to be written, and shall be construed and enforced, as so limited. 23. Captions. All captions, headings, or titles in the paragraphs or sections of this Agreement are inserted only as a matter of convenience and/or reference, and they shall in no way be construed as limiting, extending, or describing either the scope or intent of this Agreement or of any provisions hereof. 24. Binding Effect. This Agreement shall be binding and shall inure to the benefit of the parties and their respective successors, assigns, and legal representatives. 25. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. 26. Entire Agreement. This Agreement, together with the exhibits attached hereto, constitutes the entire agreement of the parties and supersedes all prior or contemporaneous negotiations, discussions, understandings, or agreements, whether oral or written, with respect to the subject matter hereof. 27. Time of Essence. Time is of the essence of this Agreement. IN WITNESS WHEREOF, the parties have executed this Master Development Agreement by their duly authorized representatives as of the date first set forth above. [signatures on next page] DEVELOPMENT AGREEMENT Page 10 CITY OF WATERLOO, IOWA By: rnest G. Clark, ayor Attest: GRAND INVESTMENTS, LLC By: Brent Dahlstrom, Manager PERSONAL GUARANTY. The undersigned, being either an officer, shareholder, manager, or member of Company, hereby agree for themselves and their heirs, personal representatives, and assigns, to unconditionally guarantee to City, its successors and assigns, the full and prompt performance by Company, its successors and assigns, of all promises and covenants on the part of Company to be performed pursuant to the foregoing Agreement, including but not limited to the duties of indemnity set forth therein. Liability of multiple guarantors hereunder is joint and several. Brent Dahlstrom EXHIBIT "A" Legal Description of Property [insert description of entire site] Note: Legal description for purposes of conveyance will be determined at a later date. EXHIBIT "B" Aerial Depiction See attached. SUPPLEMENTAL DEVELOPMENT AGREEMENT This Supplemental Development Agreement (the "Agreement") is made and entered into as of February 27, 2014 by and between Grand Investments, LLC (the "Company"), and the City of Waterloo, Iowa (the "City"). WHEREAS, City and Company are parties to that certain Master Development Agreement (the "Master Agreement") dated as of41,"7 41)/,9 , and filed on as Doc No. in the office of the Black Hawk County Recorder, providing for the phased development of real property described therein; and WHEREAS, Company is willing and able to develop the real property described on Exhibit "A" attached hereto (the "Phase Area"). NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained, Company and City agree as follows: 1. Development. It is contemplated that the Phase Area Improvements will have a total project cost of approximately $ 9cc�typo , and the parties hereby agree that the minimum actual value of the Phase Area which shall be fixed for assessment purposes after completion of Improvements shall be no less than $ � ���, ; (Y)c, ("Minimum Actual Value"). 2. Minimum Assessment Agreement. Company acknowledges and hereby agrees to the terms and conditions of the Master Agreement and that prior to the date set forth in Section 2 of Exhibit "B" hereto it will not seek or cause a reduction in the actual valuation for the Phase Area below the Minimum Actual Value, through: (i) willful destruction of the Phase Area, the Improvements, or any part of either; (ii) a request to the assessor of Black Hawk County; or (iii) any proceedings, whether administrative, legal, or equitable, with any administrative body or court within the City, Black Hawk County, the State of Iowa, or the federal government. Company agrees to sign a minimum assessment agreement in the form attached hereto as Exhibit "B" with respect to the Improvements. 3. Tax Rebates. Provided that Company satisfies the conditions set forth in the Master Agreement, City agrees to property tax rebates as set forth in Section 14 of the Master Agreement in the manner and on the terms stated therein. City shall pay rebates to Company at least annually pursuant to a schedule to be determined by City. Company's share of the January 1, 2013 taxable value ($201,140.00) referenced in the Master Agreement is %, or $ 4. Representations and Warranties. City hereby reaffirms and restates, as of the date of this Agreement, the representations and warranties of City set forth in the Master Agreement. Company hereby affirms and states that the representations and warranties made by Company in the Master Agreement are, with respect to Company, true and correct as of the date of this Agreement. 5. Relation to Master Agreement. This Agreement is a supplement to the Master Agreement, and the terms of the Master Agreement govern this Agreement to the extent not in conflict herewith. The parties hereby specifically incorporate by reference the provisions of Sections 18 through 27, inclusive, of the Master Agreement as though said Sections were set forth in full in this Agreement. 6. Capitalized Terms. Each term in this Agreement that is capitalized but not defined herein shall have the meaning assigned to it in the Master Agreement. 7. Assignment. In the event of sale of the Phase Area, the benefits and obligations of Company under this Agreement shall automatically be transferred and conveyed to the new owner. Company shall notify City within ten (10) days of any such transfer or sale. IN WITNESS WHEREOF, the parties have executed this Supplemental Development Agreement as of the date and year written above. Grand Investments, LLC Brent Dahlstrom, Manager City of Waterloo, Iowa By: Ernest G. Clark, Mayor Attest: 2 uzy h;, res, City Clerk 2 Date EXHIBIT "A" [insert Phase Area legal description] EXHIBIT "B" MINIMUM ASSESSMENT AGREEMENT This Minimum Assessment Agreement (the "Agreement") is entered into as of , by and among the CITY OF WATERLOO, IOWA ("City"), Grand Investments, LLC ("Company"), and the COUNTY ASSESSOR of the City of Waterloo, Iowa ("Assessor"). WITNESSETH: WHEREAS, on or before the date hereof the City and Company have entered into a Supplemental Development Agreement (the "SDA"), supplemental to a master development agreement entered into between said parties, regarding certain real property described therein located in the City of Waterloo; and WHEREAS, it is contemplated that pursuant to the SDA, the Company will undertake the development of an area ("Project Phase") within the City and within the Downtown Waterloo Urban Renewal and Redevelopment Plan Area; and WHEREAS, pursuant to Iowa Code § 403.6, as amended, the City and the Company desire to establish a minimum actual value for the land and the building(s) pursuant to this Agreement and applicable only to the Project Phase, which shall be effective upon substantial completion of the Project Phase and from then until this Agreement is terminated pursuant to the terms herein and which is intended to reflect the minimum actual value of the land and buildings as to the Project Phase only; and WHEREAS, the City and the Assessor have reviewed the preliminary plans and specifications for the improvements (the "Improvements") which the parties contemplate will be erected as a part of the Project Phase. NOW, THEREFORE, the parties hereto, in consideration of the promises, covenants, and agreements made by each other, do hereby agree as follows: 1. Upon substantial completion of construction of the Improvements by the Company upon the real property described on Exhibit "A" attached hereto, the minimum actual taxable value which shall be fixed for assessment purposes for the land and Improvements to be constructed thereon by the Company as a part of the Project Phase shall not be less than $ ocoi oat. (the "Minimum Actual Value") until termination of this Agreement. The parties hereto agree that construction of the Improvements will be substantially completed on or before 2. The Minimum Actual Value herein established shall be of no further force and effect, and this Minimum Assessment Agreement shall terminate, on December 31, . Nothing herein shall be deemed to waive the Company's rights under Iowa Code § 403.6, as amended, to contest that portion of any actual value assignment made by the Assessor in excess of the Minimum Actual Value established herein. In no event, however, shall the Company seek or cause the reduction of the actual value assigned below the Minimum Actual Value established herein during the term of this Agreement. The City shall not unreasonably withhold its consent to permit the Company to contest its taxable valuations in full, commencing with the assessment of January 1, 3. This Agreement shall be promptly recorded by the City with the Recorder of Black Hawk County, Iowa. The City shall pay all costs of recording. 4. Neither the preambles nor provisions of this Agreement are intended to, or shall be construed as, modifying the terms of the Development Agreement. 5. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties, including but not limited to future owners of the Project property. IN WITNESS WHEREOF, the parties have executed this Minimum Assessment Agreement by their duly authorized officers as of the date first set forth above. CITY OF WATERLOO, IOWA By: Bv: Ernest G. Clark, Mayor zy Sch - es, City Clerk STATE OF IOWA ) ss. COUNTY OF BLACK HAWK GRAND INVESTMENTS, LLC By: Brent Dahlstrom, Manager On this day of , before me, a Notary Public in and for the State of Iowa, perso ally appeared Ernest G. Clark and Suzy Schares, to me personally known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively, of the City of Waterloo, Iowa, a municipal corporation, created and existing under the laws of the State of Iowa, and that the seal affixed to the foregoing instrument is the seal of said municipal corporation, and that said instrument was 2 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 and by them voluntarily executed. STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) DeAnne Kobliska COMMISSION NO. 763995 MY COMMISSION EXPIRES Subscribed and sworn to before me on February 27, 2014, by Brent Dahlstrom as Manager of Grand Investments, LLC. gitAL, 3. A-Di9 Notary Public 3 BARBAS ► J. MOSTEK COMMISSION NO. 720408 MY COMMISSION EXPIRES January 15, 2015 CERTIFICATION OF ASSESSOR The undersigned, having reviewed the plans and specifications for the improvements to be constructed and the market value assigned to the land upon which the improvements are to be constructed for the development, and being of the opinion that the minimum market value contained in the foregoing Minimum Assessment Agreement appears reasonable, hereby certifies as follows: The undersigned Assessor, being legally responsible for the assessment of the property subject to the development, upon completion of improvements to be made on it and in accordance with the Minimum Assessment Agreement, certifies that the actual value assigned to such land, building and equipment upon completion of the development shall not be less than e X MAs ti -Ooh Dollars ($ Cp(k,((cY) ) until termination of this Minimum Assessment Agreement pursuant to the terms hereof. Assessor for Black Hawk County, Iowa Date STATE OF IOWA ) ss. COUNTY OF BLACK HAWK Subscribed and sworn to before me on by , Assessor for Black Hawk County, Iowa. Notary Public EXHIBIT "C" MINIMUM ASSESSMENT AGREEMENT This Minimum Assessment Agreement (the "Agreement") is entered into as of 21)14f-, by and among the CITY OF WATERLOO, IOWA ("Ci Y "), Grand Investments, LLC ("Company"), and the COUNTY ASSESSOR of the City of Waterloo, Iowa ("Assessor"). WITNESSETH: WHEREAS, on or before the date hereof the City and Company have entered into a Development Agreement (the "DA"), supplemental to a master development agreement entered into between said parties, regarding certain real property described therein located in the City of Waterloo; and WHEREAS, it is contemplated that pursuant to the DA, the Company will undertake the development of an area ("Phase Project") within the City and within the Downtown Waterloo Urban Renewal and Redevelopment Plan Area; and WHEREAS, pursuant to Iowa Code § 403.6, as amended, the City and the Company desire to establish a minimum actual value for the land and the building(s) pursuant to this Agreement and applicable only to the Phase Project, which shall be effective upon substantial completion of the Phase Project and from then until this Agreement is terminated pursuant to the terms herein and which is intended to reflect the minimum actual value of the land and buildings as to the Phase Project only; and WHEREAS, the City and the Assessor have reviewed the preliminary plans and specifications for the improvements (the "Improvements") which the parties contemplate will be erected as a part of the Phase Project. NOW, THEREFORE, the parties hereto, in consideration of the promises, covenants, and agreements made by each other, do hereby agree as follows: 1. Upon substantial completion of construction of the Improvements by the Company upon the real property described on Exhibit "A" attached hereto, the minimum actual taxable value which shall be fixed for assessment purposes for the land and Improvements to be constructed thereon by the Company as a part of the Phase Project shall not be less than $®oo,.gyp® (the "Minimum Actual Value") until termination of this Agreement. The parties hereto agree that construction of the Improvements will be substantially completed on or before 2. The Minimum Actual Value herein established shall be of no further force and effect, and this Minimum Assessment Agreement shall terminate, on December 31, . Nothing herein shall be deemed to waive the Company's rights under Iowa Code § 403.6, as amended, to contest that portion of any actual value assignment made by the Assessor in excess of the Minimum Actual Value established herein. In no event, however, shall the Company seek or cause the reduction of the actual value assigned below the Minimum Actual Value established herein during the term of this Agreement. The City shall not unreasonably withhold its consent to permit the Company to contest its taxable valuations in full, commencing with the assessment of January 1, 3. This Agreement shall be promptly recorded by the City with the Recorder of Black Hawk County, Iowa. The City shall pay all costs of recording. 4. Neither the preambles nor provisions of this Agreement are intended to, or shall be construed as, modifying the terms of the Development Agreement. 5. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties, including but not limited to future owners of the Project property. IN WITNESS WHEREOF, the parties have executed this Minimum Assessment Agreement by their duly authorized officers as of the date first set forth above. CITY OF WATERLOO, IOWA GRAND INVESTMENTS, LLC ;/✓� �y � �r By: Ernest G. Clark, Mayor B uzy Sc ares, City Clerk STATE OF IOWA ) ss. Brent Dahlstrom, Manager COUNTY OF BLACK HAWK ) On this 48kk day of ' / a®/ , before me, a Notary Public in and for the State of Iowa, personally appeared Ernest G. Clark and Suzy Schares, to me personally known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively, of the City of Waterloo, Iowa, a municipal corporation, created and existing under the laws of the State of Iowa, and that the seal affixed to the foregoing 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 and by them voluntarily executed. STATE OF IOWA ) ss. COUNTY OF BLACK HAWK 7/A7k(A- (7. / ry Public As I A 4& DeAnne Kobliska 0AMIk p. COMMISSION NO. 763995 a.-• MY COMMISSION EXPIRES ilia* v o ms=s aw Subscribed and sworn to before me on February 27, 2014, by Brent Dahlstrom as Manager of Grand Investments, LLC. Notary Public BARBARA J. MOSTEK COMMISSION NO. 7 I8 MY COMMISSION January15.2015_.__.__ CERTIFICATION OF ASSESSOR The undersigned, having reviewed the plans and specifications for the improvements to be constructed and the market value assigned to the land upon which the improvements are to be constructed for the development, and being of the opinion that the minimum market value contained in the foregoing Minimum Assessment Agreement appears reasonable, hereby certifies as follows: The undersigned Assessor, being legally responsible for the assessment of the property subject to the development, upon completion of improvements to be made on it and in accordance with the Minimum Assessment Agreement, certifies that the actual value assigned to such land, building and equipment upon completion of the development shall not be Tess than\x ,� \ "»» Dollars ($ LtD1001000 ) until termination of this Minimum Assessment Agreement pursuant to the terms hereof. Assessor for Black Hawk County, Iowa STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) Subscribed and sworn to before me on Date Notary Public