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HomeMy WebLinkAboutBuckets, Inc-5/14/2012DEVELOPMENT AGREEMENT This Development Agreement (the "Agreement") is entered into as of , 2012, by and between Buckets, Inc. (the "Company") and the City of Waterloo, Iowa (the "City"). 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. B. Company in the future may be willing and able to finance and construct a building and related improvements on property located in the Rath Urban Renewal Area. AGREEMENT NOW, THEREFORE, in consideration of the mutual covenants set forth herein, the parties agree as follows: 1. Development Property. City is the owner of real property described on Exhibit "A" hereto (the "Property"). Subject to the terms of this Agreement, City will deed the Property to Company. 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 the 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 that the Project will satisfy the requirements of Section 2 below. 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 has in its possession, including any abstracts, to assist in title preparation. 2. Improvements by Company. Company shall construct a building on the Property consisting of no less than 20,000 square feet, and related landscaping, sidewalks, signage and parking (collectively, the "Improvements") which upon completion will add no less than $800,000 to the assessed value of the Property as compared to the pre -improved assessed value. The Improvements must be constructed in accordance with all applicable City, state, and federal building codes and shall comply with all applicable City ordinances and other applicable law. 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". Company shall provide such plans, documents and information to City as City may reasonably request to determine in good faith whether the Improvements proposed by Company will satisfy the requirements of this Agreement. 3. Purchase Option. From the date of this Agreement through and including April 30, 2019, Company shall have the option to purchase the Property for $1.00. Company shall exercise its option, if at all, by delivery of written notice (the "Option Notice") to City no later than April 30, 2019. Within ten (10) days following delivery of the Option Notice, the parties shall execute a written purchase agreement in form acceptable to City. Closing shall occur on a date to be agreed upon by the parties following delivery of the Option Notice, which date shall be within sixty (60) days of delivery of the Option Notice (the "Closing Date"). Other terms and conditions of the Closing shall be as specified in the purchase agreement, but in any event shall include as a condition to Closing City's determination that Company's plans satisfy the requirements of Section 2 above. 4. Right of First Refusal. Whenever City is in receipt of a bona fide offer for the purchase of the Property that it desires to accept from a financially capable third party without relation to or affiliation with Company, then City shall promptly notify Company. Company shall have fourteen (14) days from the date of notification in which to exercise a right of first refusal to purchase the Property on the terms set forth in Section 3 above. Company shall exercise its right, if at all, by delivery of written notice to City within said 14 -day period, and thereafter the transaction shall proceed as set forth in Section 3. 5. Timeliness of 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 extend the development incentives provided for in this Agreement, including but not limited to its commitment to convey the Property to Company, and that without said commitment City will not do so. Company must obtain a building permit and begin construction within four (4) months of the Closing Date, and construction of Improvements on the Property shall be completed within twelve (12) months of the Closing Date (the "Project Completion Date"). If, within said 4 -month period, Company has not in good faith begun construction of the Improvements upon the Property, then title to the Property shall revert to the City. If construction has not begun within said 4 - month 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 Property shall revert to the City after the end of said extended period. If development has commenced within the 4 -month 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 is to be 2 completed by the Project Completion Date 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 the title to the Property shall revert to the City after the end of said period. In the event of any reverter of title, Company agrees that it shall, at its own expense, promptly execute and deliver to City 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 of title. Company shall pay in full, so as to discharge or satisfy, all liens, claims, charges, and encumbrances on or against the Property. Company further agrees that it shall indemnify and hold harmless the City 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, or Company's failure to carry on or complete same, or Company's ownership of the Property. If the City files suit to enforce the terms of this Section 5 and prevails in such suit, then the Company shall be liable for all of the City's legal expenses, including but not limited to reasonable attorneys' fees. 6. 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. 7. 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. 8. 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 3 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 Buckets, Inc., 324 Duryea Street, Waterloo, Iowa 50701, Attn: President. 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. 9. No Joint Venture. Nothing in this Agreement shall, or shall be deemed or construed to, create or constitute any joint venture, partnership, agency, 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. 10. 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. 11. 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. 12. 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. 4 13. Binding Effect. This Agreement shall be binding and shall inure to the benefit of the parties and their respective successors, assigns, and legal representatives. 14. 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. 15. Entire Agreement. This Agreement, together with all exhibits 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. 16. Time of Essence. Time is of the essence of this Agreement. IN WITNESS WHEREOF, the parties have executed this Development Agreement by their duly authorized representatives as of the date first set forth above. CITY OF WATERLOO, IOWA B rnest G. Clark, Mayor zy Sch : res, City Clerk 5 BUCKETS, INC. By lam= _� Kevin L. Hemmen, President EXHIBIT "A" Legal Description of Property to be Improved A part of Government Lot 1, Section 32, Township 89 North, Range 12 West of the Fifth Principal Meridian in the City of Waterloo, Black Hawk County, Iowa, lying Southerly of the Illinois Central Switch Track and lying Southeasterly of the following described line: Commencing at the point of intersection of the Southerly right-of-way line of the Illinois Central Switch Track and the Northeasterly line of former Iowa State Highway No. 297; thence Southeasterly along said Highway 620 feet to the point of beginning of the line herein described; thence Northeasterly at right angles to the Northeasterly line of said Highway to the Southerly line of the Illinois Central Switch Track, except that part thereof bounded as follows: Commencing at the intersection of the West line of the East 10 acres of said Government Lot and the Northeasterly line of said Highway; thence Northwesterly along the Northeasterly line of said Highway 270 feet; thence Northeasterly 331 feet to a point on the West line of the East 10 acres that is 429 feet North of the point of beginning; thence South along the West line of said East 10 acres 429 feet to the point of beginning, and except that part thereof lying in the East 10 acres of said Government Lot.