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HomeMy WebLinkAboutLost Island Themepark, Inc. - Dev Agmnt - 10/18/2021 Preparer: Christopher S.Wendland, P.O. Box 596 Waterloo Iowa 50704 (319)234-5701 After recording, return to Community Planning&Development, 715 Mulberry Street, Waterloo, IA 50703. DEVELOPMENT AGREEMENT This Development Agreement (the "Agreement') is entered into as of Cal�c6e-r t b , 2021, by and between Lost Island Themepark, Inc. (the "Company"), Lost Island Real Estate, L.C. ("Affiliate"), and the City of Waterloo, Iowa, ("City"). RECITALS A. In furtherance of the objectives of Iowa Code Chapter 403 (the "Urban Renewal Act'), the City is engaged in carrying out urban renewal project activities in an area known as the San Marnan Urban Renewal and Redevelopment Plan area ("Urban Renewal Area"). B. Company owns certain property located within the foregoing Urban Renewal Area, as more particularly described on Exhibit "A" attached hereto (the "Property") and is willing and able to finance and construct certain Improvements on the Property. C. City anticipates issuing municipal bonds to finance an economic development grant to Company, and Company has agreed to pay, or cause to be paid, certain projected real estate taxes by execution of a Minimum Assessment Agreement applicable to the Property. D. Company anticipates obtaining additional financing for the development of the Improvement and the Property through the use of other available debt and equity financing instruments. E. 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, and the City further believes that the project is in the vital and best interests of the City and that the project and such incentives are in accordance with the public purposes and provisions of applicable State and local laws and requirements under which the project has been undertaken and is being assisted. AGREEMENT NOW, THEREFORE, in consideration of the mutual covenants set forth herein, the parties agree as follows: 1. Improvements by Company. Company shall cause certain improvements (the "Improvements") to be constructed on the Property for development of a 159-acre theme park including multiple buildings, food service, entertainment and seating areas, multiple rides and parking, all of which shall be constructed generally in conformity with the depictions attached hereto as Exhibit "C" and in accordance with the Plans as provided in Section 2. Company agrees that the Improvements shall be constructed in accordance with the terms of this Agreement, the Urban Renewal Plan, and all applicable City, state, and federal building codes, and shall comply with all applicable City ordinances. Company will use its best efforts to obtain, or cause to be obtained, in a timely manner, all required permits, licenses and approvals, and will meet, in a timely manner, all requirements of all applicable local, state, and federal laws and regulations which must be obtained or met before the Improvements may be lawfully constructed. 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". 2. Construction Plans. Company agrees that it will cause the Improvements to be constructed on the Property in conformance with construction plans (the "Plans") that have been submitted to the City. Company agrees that the scope and scale of the Improvements to be constructed shall not be significantly less than the scope and scale of the Improvements as detailed and outlined in the Plans. Company reasonably expects that the construction of the Improvements will require a total investment of not less than $104,000,000.00. If any material modification in the scope, scale or nature of the Plans is proposed, Company shall submit modified Plans (the "Modified Plan") to the City for review. Modified Plans shall be subject to approval by the City as provided in this Section. City shall approve the modified Plans in writing if: (a) the Modified Plans conform to the terms and conditions of this Agreement; (b) the Modified Plans conform to the terms and conditions of the urban renewal plan; (c) the Modified Plans conform to all applicable federal, state and local laws, ordinances, rules and regulations and City permit and design review requirements; (d) the Modified Plans are adequate for purposes of this Agreement to provide for the construction of the Improvements, and (e) no Event of Default under the terms of this Agreement has occurred; provided, however, that any such approval of the Plans or Modified Plans pursuant to this Section shall constitute approval for the purposes of this Agreement only and shall not be deemed to constitute approval or waiver by the City with respect to any building, fire, zoning or other ordinances or regulations of the City, and shall not be deemed to be sufficient plans to serve as the basis for the issuance of a building permit if the Plans or Modified Plans are not as detailed or complete as the plans otherwise required for the issuance of a building permit. 2 The Modified Plans must be rejected in writing by City within thirty (30) days of submission or shall be deemed to have been approved by the City. If City rejects the Modified Plans in whole or in part, Company shall submit new or corrected Modified Plans within thirty (30) days after receipt by Company of written notification of the rejection, accomplished by a written statement of the City specifying the respects in which Company's Modified Plans fail to conform to the requirements of this Section. The provisions of this Section relating to approval, rejection and resubmission of corrected Modified Plans shall continue to apply until the Modified Plans have been approved by the City; provided, however, that in any event Company shall submit Modified Plans which are approved by City prior to commencement of construction of the additional or modified Improvements. Approval of the Plans or Modified Plans by the City shall not relieve Company of any obligation to comply with the terms and provisions of this Agreement, or the provision of applicable federal, state and local laws, ordinances and regulations, nor shall approval of the Plans or Modified Plans by City be deemed to constitute a waiver of any Event of Default. Approval of Plans or Modified Plans hereunder is solely for purposes of this Agreement and shall not constitute approval for any other City purpose nor subject the City to any liability for the Improvements as constructed. 3. Timeliness of Construction. Subject to Unavoidable Delays as defined herein, Company shall cause the Improvements to be Substantially Completed no later than December 31, 2022, or by such other date as the parties shall mutually agree in writing (the "Completion Date"). For purposes of this Agreement, "Substantially Completed" means the date on which the Improvements have been completed in accordance with the Plans or Modified Plans to the extent necessary for the City to issue a certificate of occupancy relating thereto. If construction is stopped and/or delayed as a result of an act of God, war, civil disturbance, court order, labor dispute, fire, pandemic, or other cause beyond the reasonable control of Company (each of the foregoing is an "Unavoidable Delay"), then time lost as a result of Unavoidable Delays shall be added to extend the Completion Date by a number of days equal to the number of days lost as a result of Unavoidable Delays, and thereafter if construction is not completed within the allowed period of extension, City may terminate this Agreement as set forth in Section 16 and City shall have no further obligation hereunder. 4. Utilities. Company will be responsible, at its own cost, 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. 5. 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 the Property. Company further agrees that prior to the date set forth in Section 2 of the Minimum Assessment Agreement (the "MAA") attached hereto as Exhibit "B" it will not seek or cause a reduction in the taxable valuation for the Property as improved pursuant to this 3 Agreement, which shall be fixed for assessment purposes, below the amount of $12,500,000.00 (the "Minimum Actual Value"), through: (a) willful destruction of the Property, the Improvements, or any part of either; (b) a request to the assessor of Black Hawk County; or (c) 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 execute and deliver the MAA concurrently with its execution and delivery of this Agreement. 6. Property Tax Rebates. Provided that Company has completed the Improvements as set forth in this Agreement and has executed the MAA, and subject to annual appropriation by the city council, City agrees to rebate property tax, subject to the exceptions and limitations otherwise set forth in this Agreement, as follows: Year One through Year Twenty 50% rebate each year for any taxable value over the January 1, 2019 value of$510,350.00 (each such payment a "Rebate"). Each Rebate is payable in respect of a given property tax fiscal year (a "Fiscal Year") only to the extent that (a) Company has actually paid general property taxes due and owing for such Fiscal Year and (b) the city council has made an appropriation for the payment of the Rebate. To receive a Rebate for a given Fiscal Year, Company must, within twelve (12) months after the due date of the last installment of the property taxes for the respective Fiscal Year (i.e., the "March Installment'), submit a completed Rebate request to City on the form provided by or otherwise satisfactory to City. A failure to timely submit a request for a Rebate for a Fiscal Year will result in a forfeiture of the right to request a Rebate for such Fiscal Year. The City agrees to consider a completed application for a Rebate within sixty (60) days after submission of the application to the 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. Rebates shall not be paid based on 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 Fiscal Year in respect of which a Rebate may be given ("Year One") shall be the first full Fiscal Year for which the assessment is based upon the completed value of the Improvements and not based on a prior Fiscal Year for which the assessment is based solely upon (x) the value of the Property, or upon (y) the value of the Property and a partial value of the Improvements due to partial completion of such Improvements or a partial Fiscal Year. 4 As an example of the above provision, in the event the Improvements on the Property are completed prior to January 1 , 2024 and the Property and Improvements are assessed as fully completed based on the Plans, as may be revised, the property taxes that would be assessed based on the January 1, 2024 assessed value would be for the Fiscal Year ending June 30, 2026, with the taxes payable one-half by September 30, 2025 and one-half by March 31, 2026, then the first Rebate could be applied for after March 31, 2026 and prior to April 1, 2027. 7. Limitations on Payment of Rebates. A. Each payment of a Rebate is subject to annual appropriation by the city council each fiscal year. The City has no obligation to make any payments to Company as contemplated under this Agreement until the city council annually appropriates the funds necessary to make such payments. The right of non- appropriation reserved to the City in this paragraph is intended by the parties, and shall be construed at all times, so as to ensure that the City's obligation to make future payments of Rebates shall not constitute a legal indebtedness of the City within the meaning of any applicable constitutional or statutory debt limitation prior to the adoption of a budget which appropriates funds for the payment of that installment or amount. In the event that any of the provisions of this Agreement are determined by a court of competent jurisdiction or by the City's bond counsel to create, or result in the creation of, such a legal indebtedness of the City, the enforcement of the said provision shall be suspended, and the Agreement shall at all times be construed and applied in such a manner as will preserve the foregoing intent of the parties, and no Event of Default by the City shall be deemed to have occurred as a result thereof. If any provision of this Agreement or the application thereof to any circumstance is so suspended, the suspension shall not affect other provisions of this Agreement which can be given effect without the suspended provision. To this end the provisions of this Agreement are severable. B. Notwithstanding the provisions of Section 6 hereof, the City shall have no obligation to make a payment of a Rebate to Company if at any time during the term hereof the City fails to appropriate funds for payment; the City receives an opinion from its legal counsel to the effect that the use of Tax Increments resulting from the Property and Improvements to fund a Rebate payment to Company, as contemplated under Section 6 above, is not, based on a change in applicable law or its interpretation since the date of this Agreement, authorized or otherwise an appropriate urban renewal activity permitted to be undertaken by the City under the Urban Renewal Act or other applicable provisions of the Code, as then constituted or under controlling decision of any Iowa court having jurisdiction over the subject matter hereof; or the City's ability to collect Tax Increment from the Improvements and Property is precluded or terminated by legislative changes to Iowa Code Chapter 403. Upon occurrence of any of the foregoing circumstances, the City shall promptly forward notice of the same to Company. If the circumstances continue for a period during which two (2) annual Rebate payments would otherwise have been paid to Company 5 under the terms of Section 6, then City may terminate this Agreement, without penalty or other liability to the City, by written notice to Company. C. For purposes of this Agreement, "Tax Increments" shall mean the property tax revenues on the Improvements and Property received by and made available to the City for deposit in an account maintained under this Agreement, the provisions of Iowa Code § 403.19 and the ordinance governing the Urban Renewal Plan. 8. Additional Covenants of Company. In addition to the other promises, covenants and agreements of Company as provided elsewhere in this Agreement, Company agrees as follows: A. Company agrees during construction of the Improvements and thereafter until the MAA termination date to maintain, as applicable, builder's risk, property damage, and liability insurance coverages with respect to the Improvements in such amounts as are customarily carried by like organizations engaged in activities of comparable size and liability exposure, and shall provide evidence of such coverages to the City upon request. B. Until the Improvements are Substantially Completed, Company shall make such reports to City, in such detail and at such times as may be reasonably requested by City, as to the actual progress of Company with respect to construction of the Improvements. C. During construction of the Improvements and thereafter until termination of the MAA, Company will cooperate fully with the City in resolution of any traffic, parking, trash removal or public safety problems which may arise in connection with the construction and operation of the Improvements. D. The Property will have a taxable value as set forth in the MAA, and Company agrees that the minimum actual value of the Property and completed Improvements as stated in the MAA will be a reasonable estimate of the actual value of the Property and Improvements for ad valorem property tax purposes. Company agrees that it will spend enough in construction of the Improvements that, when combined with the value of the Property and related site improvements, will equal or exceed the assessor's minimum actual value for the Property and Improvements as set forth in the MAX E. Company will maintain, preserve and keep the Property, including but not limited to the Improvements, in good repair and working order, ordinary wear and tear excepted, and from time to time will make all necessary repairs, replacements, renewals and additions. F. Company will comply with all applicable land development laws, City and county ordinances, and all laws, rules and regulations relating to its businesses, other than laws, rules and regulations where the failure to comply 6 with the same or the sanctions and penalties resulting therefrom, would not have a material adverse effect on the business, property, operations, or condition, financial or otherwise, of Company. G. During the period until termination of the MAA, Company agrees that it will make no conveyance, lease or other transfer of the Property or any interest therein that would cause the Property or any part thereof to be classified as exempt from taxation or subject to centralized assessment or taxation by the State of Iowa. H. Company shall pay, or cause to be paid, when due, all real property taxes and assessments payable with respect to any and all parts of the Property. Company agrees that (1) it will not seek administrative review or judicial review of the applicability or constitutionality of any Iowa tax statute or regulation relating to the taxation of real property included within the Property that is determined by any tax official to be applicable to the Property or to Company, or raise the inapplicability or constitutionality of any such tax statute or regulation as a defense in any proceedings of any type or nature, including but not limited to delinquent tax proceedings, and (2) it will not seek any tax deferral, credit or abatement, either presently or prospectively authorized under Iowa Code Chapter 403 or 404, or any other state law, of the taxation of real property included within the Property. 9. Affiliate Property. A. Conveyance. Subject to subsection B in this Section 9, within ninety (90) days after the date of this Agreement, Affiliate shall transfer to City for the sum of$1.00 all parcels titled in Affiliate's name as of the date of this Agreement that lie north of the Lost Island Water Park property and east of Hess Road (the "Affiliate Property"), consisting of approximately 56 acres, so that City may make the Affiliate Property available for other development projects. Conveyance shall be by warranty deed, free and clear of all encumbrances except: (a) easements, servitudes, conditions and restrictions of record; (b) general utility and right-of-way easements serving the Affiliate Property; and (c) restrictions imposed by City zoning ordinances and other applicable law. Company shall cause Affiliate to prepare an updated abstract of title, at the expense of City, or in lieu thereof City may, at its own expense, obtain whatever form of title evidence it desires. Company and Affiliate shall provide any abstracts and title documents in their possession, if any, to assist in title review. If title is unmarketable or subject to matters not acceptable to City, and if Affiliate does not remedy or remove such objectionable matters in timely fashion following written notice of such objections from City, City may terminate this Agreement without further obligation and return the abstract of title to Affiliate. B. Rights to Reacquire. For a period of ten (10) years after the date of this Agreement, Company and Affiliate shall have a right to reacquire title to one or more parts of the Affiliate Property either by (i) presentation of a bona fide 7 proposal to City for a development of the subject property to be substantially completed within eighteen (18) months from the date of presentation, or (ii) exercise of a right of first refusal by delivery to City of written notice of exercise within twenty-one (21) days following notice that City has received an offer to purchase the Affiliate Property or a portion thereof by a third-party with intent to develop said property. With respect to a third-party offer, the effective exercise of the right of first refusal shall require that Company and/or Affiliate agree to undertake a development project that equals or exceeds in investment value the development project proposed by the third-party offeror. Any exercise of the rights described in this paragraph shall require that Company and/or Affiliate, as applicable, shall enter into a written agreement setting forth terms satisfactory to City for development of the Affiliate Property or applicable portion thereof. Unless otherwise mutually agreed, the purchase price shall be $1.00, and conveyance shall be by special warranty deed. The rights granted by this paragraph may be exercised by Company and/or Affiliate any number of times during the 10-year period with respect to portions of the Affiliate Property remaining under City's ownership. All rights provided for in this paragraph shall permanently lapse upon expiration of the 10-year period. 10. City Activities to Aid the Project. The City agrees to undertake each of the following activities at its own expense, subject to the provisions of Section 11: A. Development Grant. City shall pay to Company a development grant in the aggregate amount of$14,000,000.00 (the "Grant") within one hundred twenty (120) days after the date of this Agreement. Company shall use the Grant only for Project purposes and for no other purpose whatsoever. B. Property Tax Rebates. City shall provide Rebates on the terms and conditions set forth elsewhere in this Agreement. C. Project Review and Assistance. The parties acknowledge and agree 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, building permit and other approvals required or necessary for Company's proposed Improvements to the Property. City will make planning, building, and engineering staff available for Project planning review and consultations in order to promote expeditious progress of the Project. D. Road Reconstruction. By September 30, 2023, City will, in such phases as City deems advisable or as required or limited by State or federal agency approvals, reconstruct a segment of E. Shaulis Road of approximately 5,595 linear feet adjacent to the Property, including the bridge that spans the drainageway. City will apply for funding through the State of Iowa RISE program to assist with the costs of such project. In support of City's reconstruction project, Company agrees to transfer to City any additional property that may be needed for expanded road right-of-way. 8 E. Support for Applications. City agrees that it will cooperate in good faith with Company and, if necessary for program requirements, will sponsor Company applications for available tax credits and/or rebates and other available government funding, if Company chooses to make such application. 11. Conditions to City Funding. A. The complete or initial funding by City of the Grant and other Project commitments shall be deemed an agreement of the parties that the applicable conditions to disbursement of funds shall, as of the date of such funding, have been satisfied or waived. If the conditions set forth in this Section are not satisfied at the Grant disbursement date, this Agreement shall terminate unless a new disbursement date is established by amendment to this Agreement. The termination of this Agreement shall be the sole remedy available to City or Company if, for whatever reason, a condition set forth in this Section is not satisfied at the Grant disbursement date, it being understood that each party shall nonetheless incur costs and liabilities prior to the Grant disbursement date for which they alone are responsible. City and Company each expressly assumes all responsibility for the costs and liabilities they may each so incur prior to the Grant disbursement date and agree to indemnify and hold each other harmless therefrom. B. It is recognized and agreed that the ability of the City to perform the obligations described in this Agreement, including but not limited to the Grant payment, is subject to completion and satisfaction of certain separate city council actions and required legal proceedings relating to the issuance of general obligation bonds (the "Bonds"), including the holding of public hearings on the same. Specifically, the closing of the transactions contemplated by this Agreement and all the obligations of City under this Agreement are subject to fulfillment, on or before each the Grant disbursement date, of each of the following conditions precedent: (i) The representations and warranties made by Company in Section 13 shall be true and correct as of the Grant disbursement date with the same force and effect as if made at such date. (ii) Company shall be in material compliance with all the terms and provisions of this Agreement. (iii) City shall have completed the sale of all or a portion of the authorized Bonds on such terms and conditions as it shall deem necessary or desirable in its sole discretion. (iv) There has not been, as of the Grant disbursement date, a substantial change for the worse in the financial resources and ability of Company, or a substantial decrease in the financing commitments secured by Company for construction of the Improvements, which 9 change(s) makes it likely, in the reasonable judgment of the City, that Company will be unable to fulfill its covenants and obligations under this Agreement. 12. 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. 13. Representations and Warranties of Company. Company hereby represents and warrants as follows: A. It 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. B. It has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as presently proposed to be conducted, and to enter into and perform its obligations under this Agreement. C. This Agreement has been duly and validly authorized, executed and delivered by Company and, assuming due authorization, execution and delivery by the other parties hereto, is in full force and effect and is a valid and legally binding instrument of Company that is enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization or other laws relating to or affecting creditors' rights generally. D. The execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, and the fulfillment of or compliance with the terms and conditions of this Agreement are not prevented by, limited by, in conflict with, or result in a violation or breach of, the terms, conditions or provisions of the articles of organization or bylaws of Company or of any contractual restriction, evidence of indebtedness, agreement or instrument of whatever nature to which Company is now a party or by which it or its property is bound, nor do they constitute a default under any of the foregoing. E. There are no actions, suits or proceedings pending or threatened against or affecting Company in any court or before any arbitrator or before or by any governmental body in which there is a reasonable possibility of an adverse decision which could materially adversely affect the business (present or prospective), financial position, or results of operations of Company or which in 10 any manner raises any questions affecting the validity of the Agreement or Company's ability to perform its obligations under this Agreement. F. The financing commitments, which Company will proceed with due diligence to obtain, to finance the construction of the Improvements will be sufficient to enable Company to successfully complete construction of the Improvements as contemplated in this Agreement, subject to additional costs incurred due to Unavoidable Delays. 14. Indemnification and Releases. A. Company hereby releases City, its elected officials, officers, employees, and agents (collectively, the "indemnified parties") from, covenants and agrees that the indemnified parties shall not be liable for, and agrees to indemnify, defend and hold harmless the indemnified parties against, any loss or damage to property or any injury to or death of any person occurring at or about the Property or resulting from any defect in the Improvements. The indemnified parties shall not be liable for, and Company shall indemnify, defend and hold such parties harmless against, any damage or injury to the persons or property of Company or its directors, officers, employees, contractors or agents, or any other person who may be about the Property or the Improvements, due to any act of negligence or willful misconduct of any person, other than any act of gross negligence or willful misconduct on the part of any such indemnified party or its officers, employees or agents. B. Except for any willful misrepresentation, any willful misconduct, or any unlawful act of the indemnified parties, Company agrees to protect and defend the indemnified parties, now or forever, and further agrees to hold the indemnified parties harmless, from any claim, demand, suit, action or other proceedings or any type or nature whatsoever by any person or entity whatsoever that arises or purportedly arises from (1) any violation of any agreement or condition of this Agreement (except with respect to any suit, action, demand or other proceeding brought by Company against the City to enforce its rights under this Agreement), or (2) the acquisition and condition of the Property and the construction, installation, ownership, and operation of the Improvements, or (3) any hazardous substance or environmental contamination located in or on the Property, but only to the extent such liability has not been previously transferred to and accepted by the City in writing. C. The provisions of this Section shall survive the expiration or termination of this Agreement. 15. Default. The following shall be "Events of Default" under this Agreement, and the term "Event of Default" shall mean any one or more of the following events that continues beyond any applicable cure periods: 11 A. Failure by Company to cause the construction of the Improvements to be commenced and completed pursuant to the terms, conditions and limitations of this Agreement; B. Transfer by Company of any interest (either directly or indirectly) in the Improvements, the Property, or this Agreement, without the prior written consent of City; C. Failure by Company to pay, before delinquency, all ad valorem property taxes levied on or against the Property; D. Failure by any party hereto to substantially observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement or the MAA; E. Company or Affiliate (1) files any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the federal bankruptcy law or any similar state law; (2) makes an assignment for the benefit of its creditors; (3) admits in writing its inability to pay its debts generally as they become due; (4) is adjudicated a bankrupt or insolvent; or if a petition or answer proposing the adjudication of Company or Affiliate, as applicable, as a bankrupt or its reorganization under any present or future federal bankruptcy act or any similar federal or state law shall be filed in any court and such petition or answer shall not be discharged or denied within ninety (90) days after the filing thereof; or a receiver, trustee or liquidator of Company, or part thereof, shall be appointed in any proceedings brought against Company and shall not be discharged within ninety (90) days after such appointment, or if Company shall consent to or acquiesce in such appointment; or (5) defaults under any mortgage applicable to the Property. F. Any representation or warranty made by Company in this Agreement, or made by Company in any written statement or certificate furnished by Company pursuant to this Agreement, shall prove to have been incorrect, incomplete or misleading in any material respect on or as of the date of the issuance or making thereof. 16. Remedies. A. Default by Company or Affiliate. Whenever any Event of Default in respect of Company or Affiliate occurs and is continuing, the City may suspend its performance under this Agreement until it receives assurances from Company or Affiliate, deemed adequate by City, that Company or Affiliate will cure its default and continue its performance under this Agreement. Before exercising such remedy, City shall give 30 days' written notice to Company or Affiliate, as applicable, of the Event of Default, provided that by the conclusion of such period the Event of Default shall not have been cured, or the Event of Default cannot reasonably be cured within 30 days and Company or Affiliate shall not have 12 provided assurances reasonably satisfactory to the City that the Event of Default will be cured as soon as reasonably possible. Further, after suspension of performance in the manner set forth above, City may terminate this Agreement and exercise any and all remedies available at law, equity, contract or otherwise for recovery of any sums paid by City to Company before the date of termination. B. Default by City. Whenever any Event of Default in respect of City occurs and is continuing, Company may take such action against City to require it to specifically perform its obligations hereunder. Before exercising such remedy, Company shall give 30 days' written notice to City of the Event of Default, provided that by the conclusion of such period the Event of Default shall not have been cured, or if the Event of Default cannot reasonably be cured within 30 days and City shall not have provided assurances reasonably satisfactory to the Company that the Event of Default will be cured as soon as reasonably possible. C. Remedies under this Agreement shall be cumulative and in addition to any other right or remedy given under this Agreement or existing at law or in equity or by statute. Waiver as to any particular default, or delay or omission in exercising any right or power accruing upon any default, shall not be construed as a waiver of any other or any subsequent default and shall not impair any such right or power. 17. Obligations Contingent. Each and every obligation of City under this Agreement is expressly made subject to and contingent upon City's completion of all procedures, hearings and approvals deemed necessary by City or its legal counsel for amendment of the urban renewal plan applicable to the Property and/or project area, all of which must be completed within ninety (90) days from the date this Agreement is approved by the City council. City hereby agrees to timely undertake and complete all such procedures, hearings and approvals so that the benefits that City promises to Company hereunder as an inducement for Company to undertake and complete the Project as set forth in this Agreement will not be lost. If such completion does not occur, then any conveyance, benefit or incentive of any type provided by City hereunder within said 90-day period is subject to reverter of title, revocation, repayment or other appropriate action to restore such property, benefit or incentive to City, and Company agrees to cooperate diligently and in good faith with any reasonable request by City to effectuate the restoration of same. To the extent permitted by applicable law, City agrees to indemnify Company and hold it harmless from and against any claims, damages, costs, expenses or loss of value suffered by Company and arising from such revocation or repayment. 18. Materiality of Promises, Covenants, Representations, and Warranties of Company and Affiliate. Each and every promise, covenant, representation, and warranty set forth in this Agreement on the part of Company and Affiliate 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 and Affiliate acknowledge that without such promises, 13 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. Performance by City. Company acknowledges and agrees that all of the obligations of City under this Agreement shall be subject to, and performed by City in accordance with, all applicable statutory, common law or constitutional provisions and procedures consistent with City's lawful authority. All covenants, stipulations, promises, agreements and obligations of City contained in this Agreement shall be deemed to be the covenants, stipulations, promises, agreements and obligations of City and not of any governing body member, officer, employee or agent of City in the individual capacity of such person. 20. No Third-Party Beneficiaries. No rights or privileges of any party hereto shall inure to the benefit of any contractor, subcontractor, material supplier, or any other person or entity, and no such contractor, subcontractor, material supplier, or other person or entity shall be deemed to be a third-party beneficiary of any of the provisions of this Agreement. 21. 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, at 2225 E. Shaulis Road, Waterloo, Iowa 50701, Attention: Gary Bertch, with a copy to Hugh Field, Beecher Field et al., 620 Lafayette Street, Waterloo, Iowa 50703. (c) if to Affiliate, at 2225 E. Shaulis Road, Waterloo, Iowa 50701, Attention: Gary Bertch, with a copy to Hugh Field, Beecher Field et al., 620 Lafayette Street, Waterloo, Iowa 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. 14 22. 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 or Affiliate, nor to create any liability for one party with respect to the liabilities or obligations of the other party or any other person. 23. 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. 24. Severability; Reformation. 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. 25. 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. 26. Interpretation. This Agreement shall not be construed more strictly against one party than against the other merely by virtue of the fact that it may have been prepared by counsel for one of the parties, it being recognized that the parties hereto and their respective attorneys have contributed substantially and materially to the preparation of each and every provision of this Agreement. 27. Binding Effect. This Agreement shall be binding and shall inure to the benefit of the parties and their respective successors, assigns, and legal representatives. 28. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. 29. Entire Agreement. This Agreement, together with the exhibits attached hereto, constitutes the entire agreement of the parties and supersedes all prior or 15 contemporaneous negotiations,discussions,understandings,or agreements, whether oral or written, with respect to the subject matter hereof. 30. 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 LOST ISLAND THEMEPARK, INC. By: s�'�� �� B Quentin Hart,Mayor Gary M. Bel h, President Attest: LOST ISLAND REAL ESTATE, L.C. Kelley FelchI6 City Clerk By: Gafy M. Bertc 01 Manager PERSONAL GUARANTY. The undersigned members and/or managers 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 pursuantto the foregoing Agreement, including but not limited to the duties of indemnity set forth therein, if any. Liability of guarantors hereu nder is joint and several. ary M. Be 7 h Reb ca L. Bertch 16 EXHIBIT "A" Legal Description of Property All that part of Section Thirteen (13), Township Eighty-eight North (T88N), Range Thirteen West (R1 3W) of the Fifth Principal Meridian, in the City of Waterloo, Black Hawk County, Iowa, described as follows: The Northwest Quarter(NW 1/4) of the Northeast Quarter (NE 1/4) of aforesaid Section Thirteen (13); AND The Southwest Quarter (SW 1/4) of the Northeast Quarter(NE 1/4) of aforesaid Section Thirteen (13); AND All that part of the Northwest Quarter(NW 1/4) of aforesaid Section Thirteen (13) lying Southeasterly of existing centerline of creek described as follows: Commencing at the North Quarter corner of aforesaid Section Thirteen (13); thence S88°55'44"W Three Hundred Sixty- seven and Eighty-seven Hundredths (367.87) feet along the North line of aforesaid Northwest Quarter (NW 1/4) to the point of beginning; thence S26002'26"W One Hundred Sixty and Sixty- nine Hundredths (160.69) feet; thence S40008'47"W One Thousand Three Hundred Seventy- three and Sixty-four Hundredths (1373.79) (sic) feet; thence S27°45'36"W One Thousand Six Hundred Seventy-two and Sixty-eight Hundredths (1672.68)feet to the South line of aforesaid Northwest Quarter(NW 1/4) and to the point of termination. EXHIBIT "B" MINIMUM ASSESSMENT AGREEMENT This Minimum Assessment Agreement (the "Agreement') is entered into as of 06-ohe1 %8 2021, by and among the CITY OF WATERLOO, IOWA ("City'), LOST ISLAND THEMEPARK, INC. ("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 "Development Agreement') regarding certain real property (the "Property'), described in Exhibit "A" thereto, located in the City; and WHEREAS, it is contemplated that pursuant to the Development Agreement, the Company will undertake the development of an area within the City and within the San Marnan Urban Renewal and Redevelopment Plan Area, including the construction of certain improvements as described in the Development Agreement (the "Minimum Improvements") on the Development Property, as provided in the Development Agreement (the "Project'); and WHEREAS, pursuant to Iowa Code § 403.6, as amended, the City and the Company desire to establish a minimum actual value for the Property and the Minimum Improvements to be constructed thereon by Company pursuant to the Development Agreement, which shall be effective upon substantial completion of the 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 Project only; and WHEREAS, the City and the Assessor have reviewed the preliminary plans and specifications for the Minimum Improvements which the parties contemplate will be erected as a part of the Project. WHEREAS, the City will make an economic development grant to Company pursuant to the Development Agreement, which may be funded in whole or in part by the issuance of general obligation bonds and/or urban renewal tax increment revenue bonds, and the principal of and interest on said bonds and reimbursement to the City for other funds from other sources are expected to be paid in part from the real property taxes paid with respect to the Property and the Minimum Improvements located thereon. 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 Minimum Improvements by the Company, the minimum actual taxable value which shall be fixed for assessment purposes for the Property and Minimum Improvements to be constructed thereon by the Company as a part of the Project shall not be less than $12,500,000.00 (the "Minimum Actual Value") until termination of this Agreement. The parties hereto agree that construction of the Minimum Improvements will be substantially completed on or before December 31, 2022. If the Minimum Improvements are not substantially completed by said date, then the parties agree to execute an amendment to this Agreement that will extend the date specified in Section 2 below. 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, 2052. The Minimum Actual Value shall be maintained during such period regardless of: (a) any failure to complete the Minimum Improvements; (b) destruction of all or any portion of the Minimum Improvements; (c) diminution in value of the Property or the Minimum Improvements; or (d) any other circumstance, whether known or unknown and whether now existing or hereafter occurring. 3. Company shall pay, or cause to be paid, when due, all real property taxes and assessments payable with respect to all and any parts of the Property and the Minimum Improvements pursuant to the provisions of this Agreement and the Development Agreement. Such tax payments shall be made without regard to any loss, complete or partial, to the Property or the Minimum Improvements, any interruption in, or discontinuance of, the use, occupancy, ownership or operation of the Property or the Minimum Improvements by Company or any other matter or thing which for any reason interferes with, prevents or renders burdensome the use or occupancy of the Property or the Minimum Improvements. 4. Company agrees that its obligation to make the tax payments required hereby, to pay the other sums provided for herein, and to perform and observe its other agreements contained in this Agreement shall be absolute and unconditional obligations of Company (not limited to the statutory remedies for unpaid taxes) and that Company shall not be entitled to any abatement or diminution thereof, or set off therefrom, nor to any early termination of this Agreement for any reason whatsoever. 5. 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. Nothing herein shall limit the discretion of the Assessor to assign at any time an actual value to the land and Minimum Improvements in excess of the Minimum Actual Value. 6. Company agrees that during the term of this Agreement it will not: (a) seek administrative review or judicial review of the applicability or constitutionality of any Iowa tax statute relating to the taxation of property contained as a part of the Property or the Minimum Improvements determined by 2 any tax official to be applicable to the Property or the Minimum Improvements, or raise the inapplicability or constitutionality of any such tax statute as a defense in any proceedings, including delinquent tax proceedings; or (b) seek any tax deferral, credit or abatement, either presently or prospectively authorized under Iowa Code Chapter 403 or 404, or any other state law, of the taxation of real property, including improvements and fixtures thereon, contained in the Property or the Minimum Improvements; or (c) request the Assessor to reduce the Minimum Actual Value; or (d) appeal to the board of review of the city, county, state or to the Director of Revenue of the State of Iowa to reduce the Minimum Actual Value; or (e) cause a reduction in the actual value or the Minimum Actual Value through any other proceedings. 7. 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. 8. Neither the preambles nor provisions of this Agreement are intended to, or shall be construed as, modifying the terms of the Development Agreement. 9. 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. 10. 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 representatives as of the date first set forth above. [signatures on next page] 3 CITY OF WATERLOO, IOWA LOST ISLAND THEMEPARK,INC. Quentin Hart,Mayor . Gary M. Be h, President By: Q Kelley Felc I e,CityClerk STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) On this day of C,�bbOr" 2021, before me, a Notary Public in and forthe State of l Mal personally appeared Quentin Hartand Kelley Felchle,tome 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 underthe 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 instrumentto be the free act and deed of said municipal corporation by it and by them voluntarily executed. 4A`J� ANCY HIGBY Notary Pubk O COAAMlSSlON N0.788229 MY COM ISSe EXPIRES � ZoZ 4 STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) Subscribed and sworn to before me on 2021 by Gary M. Bertch as President of Lost Island Themepark, Inc. Notary Public 5 CERTIFICATION OF ASSESSOR The undersigned, having reviewed the plans and specifications for the Minimum Improvements to be constructed and the market value assigned to the land upon which the Minimum 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 described in the foregoing Minimum Assessment Agreement, certifies that the actual value assigned to that land and improvements upon completion shall not be less than Twelve Million Five Hundred Thousand and 00/100 Dollars ($12,500,000.00) until termination of this Minimum Assessment Agreement pursuant to the terms hereof, subject to adjustment as provided in said agreement. Assessor for Black Hawk County, Iowa Date STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) Subscribed and sworn to before me on 2021 by T.J. Koenigsfeld, Assessor for Black Hawk County, Iowa. Notary Public EXHIBIT "C" Depictions of Improvements See pages attached hereto.