HomeMy WebLinkAboutZydeco Investments, LLC - 11/15/2021 Prepared by Christopher S.Wendland P.O. Box 596 Waterloo IA 50704 Phone(319)234-5701
DEVELOPMENT AGREEMENT
This Development Agreement (the "Agreement") is entered into as of November
f 5 2021, by and between Zydeco Investments, LLC (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, 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.
B. Company is willing and able to finance and construct buildings and related
improvements on property located in the East Waterloo Unified Urban Renewal and
Redevelopment Plan Area, formerly known as the Airport Area Development Plan area,
(the "Urban Renewal Area") 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. Sale of Property; Title. Subject to the terms hereof, City shall convey the
Property to Company for the sum of one million, one hundred and seventy thousand
dollars ($1,170,000.00) (the "Purchase Price"). Conveyance shall be by quit claim
deed, free and clear of all encumbrances arising by or through City except:
(a) easements, servitudes, conditions and restrictions of record; (b) general utility and
right-of-way easements serving the Property; and (c) 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 of financial
ability to undertake and carry on 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. City shall provide any abstracts and title documents it
has in its possession, if any, to assist in title review. 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 without further obligation and return
the abstract of title to City.
2. Improvements by Company. Company shall construct on the Property
an industrial building of no less than 170,000 total square feet, comprised of
approximately 20,000 square feet of office space, 138,000 square feet of manufacturing
and warehouse space, and 12,000 square feet of product testing space, as well as
related landscaping, paving, signage and parking improvements (collectively, the
"Improvements"), in accordance with the Plans as provided in Section 2.1. Company
agrees that the Improvements shall be constructed in accordance with the terms of this
Agreement, the East Waterloo Unified Urban Renewal and Redevelopment Plan (the
"Urban Renewal Plan"), and all applicable City, state, and federal building codes and
shall comply with all applicable City ordinances and other applicable law. 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".
2.1. Construction Plans. Company agrees that it will cause the
Improvements to be constructed on the Property in conformance with construction plans
(the "Plans") 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 shall cause Plans to be provided for the Improvements, which
shall be subject to approval by the City as provided in this Section. City shall approve
the Plans in writing if: (a) the Plans conform to the terms and conditions of this
Agreement; (b) the Plans conform to the terms and conditions of the Urban Renewal
Plan; (c) the Plans conform to all applicable federal, state and local laws, ordinances,
rules and regulations and City permit and design review requirements; (d) the 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 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
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are not as detailed or complete as the plans otherwise required for the issuance of a
building permit. Approval of Plans hereunder shall not constitute approval for any other
City purpose nor subject the City to any liability for the Improvements as constructed.
The 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
Plans in whole or in part, Company shall submit new or corrected 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 Plans fail to
conform to the requirements of this Section. The provisions of this Section relating to
approval, rejection and resubmission of corrected Plans shall continue to apply until the
Plans have been approved by the City; provided, however, that in any event Company
shall submit Plans which are approved by City prior to commencement of construction
of the Improvements. Approval of the 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 by City be deemed to constitute a waiver of any Event of
Default.
3. Timeliness of Conveyance and Construction; Option to Repurchase.
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 sell and convey the Property to Company and that without said commitment
City would not do so.
3.1. Deadlines to commence and complete. Subject to Unavoidable Delays
(defined below), Company must obtain a building permit and begin construction on the
Improvements by December 31, 2021 (the "Start Date") and must substantially
complete construction by December 31, 2023 (the "Completion Deadline"). For
purposes of this Agreement, substantial completion of construction shall be evidenced
by issuance of an occupancy permit.
3.2. Option to Repurchase. At the time of transfer of the Property to the
Company, the Company shall execute and deliver to the City a written Option to
Repurchase (the "Option to Repurchase") the Property, pursuant to which Option to
Repurchase, the City shall have the right to purchase the Property from the Company in
the event the Company has not commenced construction of the improvements on the
Property on or before June 30, 2022. The Option to Repurchase shall be in a mutually
acceptable form and shall include provisions acceptable to the Company's lender. A
memorandum of the Option to Repurchase shall be recorded in the office of the
Recorder for Black Hawk County, Iowa.
The Option to Repurchase shall provide that if construction of the
improvements has not commenced by the Start Date or within any agreed period of
extension and is stopped and/or delayed as a result of an act of God, war, civil
disturbance, court order, labor dispute, fire, supply chain disruption or other cause
beyond the reasonable control of Company (each such condition or event being an
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"Unavoidable Delay"), the right to repurchase the Property shall not accrue until the
expiration of the period of time equal to the period of the Unavoidable Delay.
4. Option to Repurchase; Indemnity. In the event the City exercises the
Option to Repurchase, Company agrees that it shall 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 the transfer of the Property to the City, free
and clear of any lien, claim, charge, security interest, mortgage or encumbrance
(collectively, "Liens") arising by or through Company, in exchange for the payment by
the City of an amount equal to the Purchase Price. Concurrently with delivery of the
deed, Company shall also deliver to City the abstract of title. Company shall pay in full,
so as to discharge or satisfy, all Liens on or against the Property.
4.1. Appointment of Attorney in Fact. 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.
4.2. Indemnification. 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 or Liens on or against the Property of
any type or nature whatsoever that attaches to the Property by virtue of Company's
ownership of same. If City files suit to enforce the terms of this Agreement or the
Option to Purchase and prevails in such suit, then Company shall be liable for all legal
expenses, including but not limited to reasonable attorneys' fees, incurred by City.
Company's duties of indemnity pursuant to this Section shall survive the expiration,
termination or cancellation of this Agreement for any reason.
5. No Encumbrances; Limited Exception. Until completion of the
Improvements, Company agrees that it shall not create, incur, or suffer to exist any
Liens on the Property, other than such mortgage or mortgages as may be reasonably
necessary to pay the Purchase Price and finance Company's completion of the
Improvements and of which Company notifies City before Company executes any such
mortgage. Company may not mortgage the Property or any part thereof for any
purpose except in connection with financing of the Purchase Price and the
Improvements.
6. Utilities and Services. Company will be responsible for extending water,
sewer, telephone, telecommunications, electricity, gas and other utility services to any
location on the Property and for payment of any associated connection fees.
7. Additional City Assistance. The incentives described in the following
subsections of this Section 7 are in addition to the other Project incentives extended by
City to Company hereunder.
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7.1. Roadway. City will apply for funds under the State of Iowa RISE program
for construction of a new street from Leversee Road extending eastward, to be called
Hyper Drive, to serve the Property. City will complete design and construction of the
new street and installation of related infrastructure by December 31, 2021.
7.2. Support for Applications. City agrees that it will cooperate in good faith
with Company and, if necessary for program requirements, sponsor Company
applications for available state tax credits and/or rebates, community college job training
funds, and other available government funding, if Company chooses to make any such
application(s).
7.3. Option to Sell. The parties acknowledge that upon completion of
Improvements, the Property will be occupied by a third-party tenant, currently
contemplated to be CPM Holdings Inc., or an affiliated entity ("CPM"). CPM or its
affiliate currently own or occupy property at 2975 Airline Circle, Waterloo, Iowa (the
"2975 Airline Property"). At the time of purchase of the Property, the City agrees to
execute and deliver to CPM an Option to Sell (the "Option to Sell") the 2975 Airline
Property to the City for an amount equal to its fair market value, as determined by an
appraisal by an MAI appraiser acceptable to both CPM and the City, plus the cost of the
appraisal (the "2975 Airline Sale Price"). Pursuant to the Option to Sell, CPM or any
successor owner of the 2975 Airline Property shall have the right to exercise the Option
to Sell within ninety (90) days after CPM has completed the transition of its operations
and equipment to the Property, by delivery to the City of a written notice of exercise of
the Option to Sell. Thereafter, the City shall purchase the 2975 Airline Property for the
2975 Airline Sale Price within sixty (60) days following the receipt by the City of the
notice of exercise of the Option to Sell. The purchase shall be free and clear of (i) any
mortgages or other liens or encumbrances created by CPM or its assignee, and (ii) any
environmental conditions that significantly impair the use or value of the 2975 Airline
Property. Prior to any such purchase and at any reasonable time, City, its agents and
contractors, shall have access to the 2975 Airline Property for purposes of evaluation
and environmental testing. Company shall obtain all permission from the owner of 2975
Airline Property for City's access for purposes of appraisal, evaluation and testing. If
access by City, its agents or contractors, is denied or unduly restricted, City may
terminate the obligation to purchase the 2975 Airline Property under the Option to Sell if
reasonable access is not allowed within thirty (30) days of advance written notice to
Company.
7.4. Progress Incentive Payment. Within thirty (30) days after Company has
provided such documentation as City reasonably requires to substantiate that Company
has expended no less than $2,000,000 in construction of Improvements on the Property
as part of the Project, the City shall pay the Company the amount of one million, two
hundred seventy thousand ($1,270,000.00) as an incentive payment based on the
progress of the Project.
7.5. Option to Purchase Additional Land. City hereby grants to the Company,
its successors and assigns, an option to purchase, for the sum of $1.00, up to an
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additional 10 acres of land abutting the Property to the extent necessary in connection
with any project for a significant expansion of the Improvements. The option may be
exercised by delivering written notice of exercise to the City no later than December 31,
2031. The option shall terminate upon the first to occur of January 1, 2032, or the
termination of this Agreement prior to construction of the Improvements. If Company
exercises the option, the parties shall negotiate the terms of a new development
agreement or an amendment to this Agreement to address requirements related to the
expansion project. Unless governed by the terms of such agreement or amendment,
the provisions of Section 1 hereof shall govern the transfer of title.
8. Minimum Assessment Agreement. Company acknowledges and
agrees that it, or its assign of according to Section 16.2, 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 Agreement, which shall be fixed for assessment
purposes, below the amount of $8,000,000.00 (the "Minimum Actual Value"), through:
(i) willful destruction of the Property, 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 execute and deliver the MAA concurrently with execution and
delivery of this Agreement.
9. Property Tax Rebates. Provided that Company has completed the
Improvements as set forth in this Agreement, City agrees to rebate property tax, subject
to the exceptions and limitations otherwise set forth in this Agreement, as follows:
Year One through Year Fifteen 50% rebate each year
for any taxable value over the January 1, 2021 value of $0 (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 (i) Company, or its assign according to Section
16.2, has actually paid general property taxes due and owing for such Fiscal Year and
(ii) 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
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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 of in 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.
As an example of the above provision, in the event the Improvements on the
Property are completed prior to January 1, 2023 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, 2023 assessed value would be
for the Fiscal Year ending June 30, 2024, with the taxes payable one-half by September
30, 2024 and one-half by March 31, 2025, then the first Rebate could be applied for
after March 31, 2025 and prior to April 1, 2026.
10. Limitations on Payment of Rebates.
10.1. 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 subsection 10.1 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.
10.2. Notwithstanding the provisions of Section 9 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
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Development Property and Minimum Improvements to fund a Rebate payment to
Company, as contemplated under Section 9 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 Minimum
Improvements and Development 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 under the terms of Section 9, the City may
terminate this Agreement, without penalty or other liability to the City, by written notice
to Company.
10.3. 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
Section 403.19 of the Code and the ordinance governing the Urban Renewal Plan.
11. 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:
11.1. 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.
11.2. Until substantial completion of the Improvements, 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.
11.3. 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.
11.4. Company will comply with all applicable land development laws and 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 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.
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11.5. The Property will have a taxable value as set forth in the MAA and any
amendments thereto, and Company agrees that the minimum actual value of the
Property and completed Improvements as stated in the MAA and any amendments
thereto 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 MAA and any
amendments thereto.
11 .6. Until termination of the MAA, 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.
11.7. During the period that any rebate is payable to Company under this
Agreement, Company agrees that (1) it will not undertake, in any other municipality in
Black Hawk County, the construction or rehabilitation of any commercial property as a
primary location for the business operations of the type to be conducted on the Property
by Company, and (2) 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.
11.8. 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.
12. Representations and Warranties of City. City hereby represents and
warrants as follows:
12.1. City is not prohibited from consummating the transaction contemplated in
this Agreement by any law, regulation, agreement, instrument, restriction, order or
judgment.
12.2. 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.
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13. Representations and Warranties of Company. Company hereby
represents and warrants as follows:
13.1. Company is not prohibited from consummating the transaction
contemplated in this Agreement by any law, regulation, agreement, instrument,
restriction, order or judgment.
13.2. 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.
13.3. 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.
13.4. 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.
13.5. Assuming due authorization, execution and delivery by the other parties
hereto, this Agreement 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.
13.6. 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 any manner raises any
questions affecting the validity of the Agreement or Company's ability to perform its
obligations under this Agreement.
14. Indemnification and Releases.
14.1. 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 any damage or
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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 negligence or willful misconduct on the part of any such indemnified
party or its officers, employees or agents.
14.2. 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.
14.3. The provisions of this Section shall survive the expiration or termination of
this Agreement.
15. 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 180 days from the date this Agreement is approved
by the City council. If such completion does not occur, then any conveyance, benefit or
incentive of any type provided by City hereunder within said 180-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, or
failing such restoration Company agrees to be liable for same or for the fair value
thereof, plus interest on any sums owing at the rate of 5% per annum commencing with
the date of demand for payment, if said payment is not remitted to City within 30 days.
16. No Assignment or Conveyance.
16.1. Company agrees that it will not sell, convey, assign or otherwise transfer
its interest in the Property or this Agreement prior to completion of the Project, whether
in whole or in part, to any other person or entity without the prior written consent of City.
Notwithstanding the preceding sentence, the Company shall be permitted to assign all
of the member interest in the Company to any lender or guarantor of the Company's
debt, St. Martin Land Company or a wholly owned subsidiary of St. Martin Land
Company prior to completion of the Project without any consent of the City (other than
this provision). 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
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satisfaction that it has the financial ability to observe all of the terms to be performed by
Company under this Agreement.
16.2. Company shall have the right to assign the right to apply for and receive a
Rebate under this Agreement for one or more years to (i) a tenant of the Property, (ii) a
lender to Company and/or (iii) a purchaser of the Property. In the event of any such
assignment, Company shall provide the City with written notice of such assignment.
17. 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:
17.1. 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;
17.2. 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,
except as permitted in Section 16 above;
17.3. Failure by Company to pay, before delinquency, all ad valorem property
taxes levied on or against the Property;
17.4. 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 an MAA;
17.5. Company (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 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 any of Project Property.
17.6. 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.
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18. Remedies.
18.1. Default by Company. Whenever any Event of Default in respect of
Company occurs and is continuing, the City may terminate this Agreement. Before
exercising such remedy, City shall give 30 days' written notice to Company 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 shall not have provided assurances reasonably satisfactory to the City
that the Event of Default will be cured as soon as reasonably possible. Upon
termination, City may 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 or to recover ownership of the Property as set forth in this Agreement.
18.2. Default by City. Whenever any Event of Default in respect of Company
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.
18.3. 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.
19. 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.
20. 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.
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21. No Third-Party Beneficiaries. Except as provided in Section 16 above,
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.
22. 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 115 3rd St. SE, #806, Cedar Rapids, IA 52401,
email nick.taiber@stmartinholdings.com, Attention: President, with copies to
kwebster@stmartinholdings.com.
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.
23. 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.
24. 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.
25. 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
14
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.
26. 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.
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
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.
[signatures on next page]
15
CITY OF WATERLOO, IOWA ZYDECO INVEST NTS, LLC
By: By:
Quentin M. Hart, Mayor Nicholas Taber, Manager
Attest: ` 141,
Kelley Felcl , City Clerk
16
EXHIBIT "A"
Legal Description of Property
[add — to be determined]
EXHIBIT "B"
MINIMUM ASSESSMENT AGREEMENT
This Minimum Assessment Agreement (the "Agreement") is entered into as of
November 15 , 2021, by and among the CITY OF WATERLOO, IOWA ("City"),
ZYDECO 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 "Development Agreement") regarding certain real
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 ("Project") within the City and
within the East Waterloo Unified Urban Renewal and Redevelopment Plan Area,
formerly known as the Airport Area Development 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, 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 improvements (the "Improvements") which the parties contemplate
will be erected as a part of the 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, 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 shall not be less than $8,000,000.00 (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 the Completion Deadline
stated in the Development Agreement. If it is not completed within the same calendar
year as the Completion Deadline, then the parties agree to execute an amendment to
this Agreement that will extend the dates 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,
2042. 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 Improvements in excess of the Minimum Actual Value.
3. Company agrees that 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.
4. 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.
5. Neither the preambles nor provisions of this Agreement are intended to, or
shall be construed as, modifying the terms of the Development Agreement.
6. 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.
CITY OF WATERLOO, IOWA ZYDECO INVESTMENTS, LLC
By: By:
Quentin M. Hart, Mayor Nicholas Taiber, Manager
By: lkjv'k� .
Kelley Felchl , City Clerk
2
STATE OF IOWA )
) ss.
COUNTY OF BLACK HAWK )
On this day of I Oyc;j_{z,r 2021, before me, a Notary Public in
and for the State of Iowa, personally appeared Quentin M. Hart and Kelley Felchle, 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.
oI "` J Ikv-C^AL40L )
NANCY HI(.3BY
COMMISSION NO.7&9229 Notary ublic 1
My C9I 9SION EXPIRES J
OC��Vi
STATE OF IOWA )
) SS.
COUNTY OF BLACK HAWK )
Subscribed and sworn to before me on2021, by Nicholas
Taiber as Manager of Zydeco Investments, LLC.
MARIAN G
;Commission Number
83 83
m13737 6
My Commission Expires N a Public
April 15, 2024 ry
3
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 Eight Million Dollars ($8,000,000.00) 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 T.J.
Koenigsfeld, Assessor for Black Hawk County, Iowa.
Notary Public