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HomeMy WebLinkAboutAvita Developments, LLC - Development Agreement & Minimum Assessment Agreement - 6/20/2022DEVELOPMENT AGREEMENT This DEVELOPMENT AGREEMENT (this "Agreement") is entered into as of n Zo , 2022, by and between AVITA DEVELOPMENTS, LLC, an Iowa limited liability company (the "Company"), and the CITY OF WATERLOO, IOWA (the "City"). RECITALS A. The City and the Company are parties to the following: (i) that certain Development Agreement dated as of May 5, 2008 (and Minimum Assessment Agreement dated of even date executed by the Company's principal, Kalyana Sundaram, as "Developer," and attached as Exhibit B thereto), and filed in the records of the Black Hawk County Recorder on November 24, 2009 as Document No. 2010-00010498, as amended by that certain First Amendment to Development Agreement dated as of January 9, 2012, and filed in the records of the Black Hawk County Recorder on January 24, 2012 as Document No. 2012-00013692 (collectively, the "2008 Development Agreement"); and (ii) that certain Development Agreement dated as of July 16, 2018 (and Minimum Assessment Agreement dated of even date and attached as Exhibit B thereto), and filed in the records of the Black Hawk County Recorder on August 28, 2018 as Document No. 2019-3366, as amended by that certain Amendment to Development Agreement dated as of October 15, 2018, and filed in the records of the Black Hawk County Recorder on January 28, 2019 as Document No. 2019-11557 (collectively, the "2018 Development Agreement"). B. The 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 (as hereinafter defined) 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. C. The Company has, prior to the date of this Agreement, financed and constructed buildings and related improvements ("Improvements") on real property legally described on Exhibit A attached hereto (the "Property"), located in the East Waterloo Unified Urban Renewal and Redevelopment Plan Area, formerly known as the Logan Plaza Urban Renewal and Redevelopment Plan Area (the Property and the Improvements constructed thereon by the Company, collectively, the "Project"). D. The City and the Company desire to amend and restate, and this Agreement shall supersede and replace, the 2008 Development Agreement and the 2018 Development Agreement in their entireties. Accordingly, from and after the date of this Agreement, the 2008 Development Agreement and the 2018 Development Agreement shall terminate and be of no further force and effect. AGREEMENT NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: 1. Improvements by the Company. The City and the Company acknowledge and agree that, prior to the date of this Agreement, the Company has completed construction and development of, and satisfied all of its obligations with respect to the construction and development of, the Project, all parts thereof and all work ancillary thereto, including, without limitation, work required to extend water, sewer, telephone, telecommunications, electricity, gas and other utility services from public rights -of -way to locations on the Property and payment of associated connection fees, (a) in accordance with all applicable City, state and federal building codes and in compliance with all applicable City ordinances and other applicable law, and (b) within the timeframes required by the City. 2. Minimum Assessment Agreement. The 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. The Company further agrees that prior to the date set forth in Section 2 of the Minimum Assessment Agreement attached hereto as Exhibit B (the "Minimum Assessment Agreement"), it will not seek or cause a reduction in the taxable valuation for the Property, which shall be fixed for assessment purposes, below the amount of $3,701,320.00 (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. The Company has executed the Minimum Assessment Agreement concurrently herewith. 3. Tax Rebates. In consideration of the Company's financing, development and construction of the Project, the Company has been receiving tax rebates with respect to the Property and other real property prior to the date of this Agreement pursuant to the terms of the 2008 Development Agreement and the 2018 Development Agreement. The City agrees to continue to rebate property taxes with respect to the Property (with the exceptions noted below) as follows: a. Year One through Year Five: 50% rebate each year for any taxable value over the January 1, 2018 value of $2,601,320.00 (each such payment is a "Rebate"). Rebates are payable in respect of a given year only to the extent that (1) Company has actually paid general property taxes due and owing for such year and (2) the City council has made an appropriation for payment of the Rebate. To receive rebates for a given year, Company must, within twelve (12) months after the tax payment due date, submit a completed rebate request to City on the form provided by or otherwise satisfactory to City, or the rebate shall be forfeited. b. The taxable value of the Property as a result of the Improvements must be increased by a minimum of 10% and must increase the annual tax by a minimum of $500.00. This rebate program is not applicable to any special assessment levy, debt service levy, or any other levy that is exempted from treatment as tax increment financing under the provisions of applicable law. c. The first year of in which a rebate may be given ("Year One") shall be the first full year for which the assessment is based upon the completed value of the Improvements, and not based on a prior 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 the Improvements or a partial tax year. For purposes hereof, "Year One" shall mean January 1, 2019. Notwithstanding anything to the contrary contained in this Agreement (including, without limitation, Section 14 hereof), the parties agree that (i) the right to receive Rebates and any other incentive payments payable under this Agreement, and the obligations in connection with such Rebates, shall be personal to Avita Developments, LLC ("Original Company"), as the original Company under this Agreement, and shall not inure to the benefit, or become the obligation, as applicable, of any successor owner of the Property, (ii) Original Company shall not assign any of its right, title and interest in and to any Rebates or other incentive payments under this Agreement, or any obligations in connection with such Rebates, to any successor owner of the Property. 4. Limitations on Payment of Rebates. a. Each payment of a Rebate is subject to annual appropriation by the city council each fiscal year. 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 City in this paragraph is intended by the parties, and shall be construed at all times, so as to ensure that City's obligation to make future payments of Rebates shall not constitute a legal indebtedness of 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 City's bond counsel to create, or result in the creation of, such a legal indebtedness of 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 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 3 hereof, City shall have no obligation to make a payment of a Rebate to Company if at any time during the term hereof (1) City fails to appropriate funds for payment; (2) 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 3 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 City under Iowa Code Chapter 403 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 (3) 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, 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 3 then City may terminate this Agreement, without penalty or other liability to 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 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. 5. Conditions to City Funding. The complete or initial funding by City of the Rebates and other Project commitments shall be deemed an agreement of the parties that the applicable conditions to disbursement of funds as set forth in Section 4 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 a Rebate 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 a Rebate payment date, it being understood that each party shall nonetheless incur costs and liabilities prior thereto 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 a Rebate payment date and agree to indemnify and hold each other harmless therefrom. 6. Representations and Warranties of City. City hereby represents and warrants as follows: a. City is not prohibited from consummating the transaction contemplated in this Agreement by any law, regulation, agreement, instrument, restriction, order or judgment. b. Each person who executes and delivers this Agreement and all documents to be delivered hereunder is and shall be authorized to do so on behalf of City. 7. Representations and Warranties of Company. Company hereby represents and warrants as follows: a. Company is not prohibited from consummating the transaction contemplated in this Agreement by any law, regulation, agreement, instrument, restriction, order or judgment. b. Company is duly organized, validly existing, and in good standing under the laws of the state of its organization and is duly qualified and in good standing under the laws of the State of Iowa. c. Company has full right, title, and authority to execute and perform this Agreement and to consummate all of the transactions contemplated herein, and each person who executes and delivers this Agreement and all documents to be delivered to City hereunder is and shall be authorized to do so on behalf of Company. 8. 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. 9. 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 3904 Alexis Blvd., Cedar Falls, Iowa 50613, Attention: Kalyana Sundaram. 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. 10. 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. 11. 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. 12. Severability. Each provision, section, sentence, clause, phrase, and word of this Agreement is intended to be severable. If any portion of this Agreement shall be deemed invalid or unenforceable, whether in whole or in part, the offending provision or part thereof shall be deemed severed from this Agreement and the remaining provisions of this Agreement shall not be affected thereby and shall continue in full force and effect. If, for any reason, a court finds that any portion of this Agreement is invalid or unenforceable as written, but that by limiting such provision or portion thereof it would become valid and enforceable, then such provision or portion thereof shall be deemed to be written, and shall be construed and enforced, as so limited. 13. 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. 14. Binding Effect. Except as otherwise expressly provided in Section 3, this Agreement shall be binding and shall inure to the benefit of the parties and their respective successors, assigns, and legal representatives, including, but not limited to, future owners of the Property. 15. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. 16. 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. 17. Time of Essence. Time is of the essence of this Agreement. 18. Termination. This Development Agreement and the Minimum Assessment Agreement attached hereto shall each automatically terminate and be of no further force and effect on December 31, 2029, without the requirement of any further action by the parties hereto. Upon any early termination of this Agreement, whether pursuant to Section 4(b), Section 5, or otherwise, the Minimum Assessment Agreement shall concurrently terminate, the parties shall execute an agreement evidencing the termination of this Agreement and the Minimum Assessment Agreement, and shall record the same in the records of the Black Hawk County Recorder. [Signature page follows] IN WITNESS WHEREOF, the parties have executed this Development Agreement by their duly authorized representatives as of the date first set forth above. CITY: CITY OF WATERLOO, IOWA By: Attest: Quentin Hart, Mayor Kelley Felchle, COMPANY: ity Clerk AVITA DEVELOPMENTS, LLC, an Iowa limited liability company By: Name: Title: ACCEPTED AND AGREED: KALYANA SUNDARAM, as "Developer" under the Minimum Assessment Agreement attached as Exhibit B to the 2008 Development Agreement [Notary acknowledgments on following page] STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) b4" On this a� day of '-R-P , 2022, before me, a Notary Public a Notary Public in and for the State of Iowa, personally appeared Quentin 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 County, 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. 0 ,o NANCY HIGBY COMMISSION NO.788229 MYCIMM SI• ESIR 5 STATE OF IOWA ) ss. COUNTY OF BLACK HAWK Subscribed and sworn to before me on , 2022, by , as of Avita Developments, LLC. Notary Public STATE OF IOWA COUNTY OF BLACK HAWK Subscribed and sworn to before me on , 2022, by Kalyana Sundaram, an individual. Notary Public EXHIBIT A LEGAL DESCRIPTION OF THE PROPERTY Real property in the City of Waterloo, County of Black Hawk, State of Iowa, described as follows: Parcel M, more particularly described on Plat of Survey filed December 8, 2021, as Document No. 2022-12003, as corrected by Surveyor's Affidavit filed December 21, 2021, as Document No. 2022-12984, being part of the SW 1/4 of Section 12-89-13, Waterloo, Black Hawk County, Iowa. EXHIBIT B MINIMUM ASSESSMENT AGREEMENT This MINIMUM ASSESSMENT AGREEMENT (this "Agreement") is entered into as of J V nt„ ?.,o , 2022, by and among the CITY OF WATERLOO, IOWA (the "City"), AVITA DEVELOPMENTS, LLC, an Iowa limited liability company (the "Company"), and the ASSESSOR FOR BLACK HAWK COUNTY, IOWA (the "Assessor"). WITNESSETH: WHEREAS, on the date hereof the City and Company have entered into a Development Agreement (the "Development Agreement") regarding certain real property described in Exhibit A attached thereto, located in the City; and WHEREAS, pursuant to the Development Agreement, the Company has undertaken and completed the development of the Project (as defined in the Development Agreement) within the City and within the East Waterloo Unified Urban Renewal and Redevelopment Plan Area, formerly known as the Logan Plaza Urban Renewal and Redevelopment Plan Area, of the City; 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) in the Project pursuant to this Agreement and applicable only to the Project, which minimum actual value became effective upon substantial completion of the Project and shall continue to be effective until the termination of this Agreement pursuant to the terms herein, and which is intended to reflect the minimum actual value of the land and buildings at the Project only; and NOW, THEREFORE, the parties hereto, in consideration of the promises, covenants, and agreements made by each other, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, do hereby agree as follows: 1. From and after substantial completion of construction of the Improvements by the Company, the minimum actual taxable value fixed for assessment purposes for the Property and Improvements constructed thereon by the Company as a part of the Project shall not be less than $3,701,320.00 (the "Minimum Actual Value") until termination of this Agreement. The parties hereto agree that substantial completion of construction of the Improvements occurred on or about June 1, 2018. 2. The Minimum Actual Value herein established shall be of no further force and effect, and this Agreement shall automatically terminate, on December 31, 2029, without the requirement of any further action by the parties hereto. Additionally, this Agreement shall automatically terminate upon any early termination of the Development Agreement. 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 to the Project to be reduced below the Minimum Actual Value established herein during the term of this Agreement. 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 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 Improvements, any interruption in, or discontinuance of, the use, occupancy, ownership or operation of the Property or the 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 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 except as expressly provided herein or in the Development Agreement. 5. 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 Improvements determined by any tax official to be applicable to the Property or the 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 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 of the Minimum Actual Value through any other proceedings. 6. This Agreement shall be promptly recorded by the City with the Recorder of Black Hawk County, Iowa. 7. Neither the preambles nor provisions of this Agreement are intended to, or shall be construed as, modifying the terms of the Development Agreement. 8. Except as otherwise expressly provided in the Development Agreement, 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 Property. 9. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Development Agreement. 10. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. [Signature pages follow] 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: CITY OF WATERLOO, IOWA By: uentin Hart, Mayor COMPANY: AVITA DEVELOPMENTS, LLC, an Iowa limited liability company By: Name: Title: [Signatures and notary acknowledgments continued on following pages] STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) S On this V.k, day of F.Q , 2022, before me, a Notary Public a Notary Public in and for the State of Iowa, personally appeared Quentin 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 County, 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. * A' ' COMMISSION NO.788229 MY COMMISSION EXPIRE$ 'owl. r- 3 )---6 Z `-I.. STATE OF IOWA ) ss. COUNTY OF BLACK HAWK Subscribed and sworn to before me on , 2022, by as of Avita Developments, LLC. Notary Public CERTIFICATION OF ASSESSOR The undersigned having reviewed the improvements constructed and the market value assigned to the land upon which the improvements were constructed at the time of such construction, and being of the opinion that the minimum market value contained in the foregoing Minimum Assessment Agreement appears reasonable as of such date of construction, hereby certifies as follows: The undersigned Assessor, being legally responsible for the assessment of the property subject to the development, certifies that the actual value assigned to such land, building and equipment upon completion of the development shall not be less than Three Million, Seven Hundred One Thousand, Three Hundred Twenty and No/100 Dollars ($3,701,320.00) until termination of this Minimum Assessment Agreement pursuant to the terms hereof. ASSESSOR FOR BLACK HAWK COUNTY, IOWA By: Name: Title: STATE OF IOWA ) ss. COUNTY OF BLACK HAWK Subscribed and sworn to before me on , 2022, by , Assessor for Black Hawk County, Iowa. Notary Public Number: 202200024949 Recorded: 6/23/2022 at 4:01:28.0 PM County Recording Fee: $97.00 Iowa E-Filing Fee: $3.00 Combined Fee: $100.00 Revenue Tax: Sandie L. Smith, RECORDER Black Hawk County, Iowa Development Agreement Recorder's Cover Sheet Preparer Information: (name, address and phone number) Noel Anderson, 715 Mulberry St., Waterloo, IA 50703 (319)291-4366 Taxpayer Information: (name and complete address) N/A Return Document To: (name and complete address) Noel Anderson, 715 Mulberry St., Waterloo, IA 50703 Grantors: N/A Grantees: N/A Legal Description: Document Document or instrument number of previously recorded documents: DEVELOPMENT AGREEMENT This DEVELOPMENT AGREEMENT (this "Agreement") is entered into as of -Jv n L 2 o , 2022, by and between AVITA DEVELOPMENTS, LLC, an Iowa limited liability company (the "Company"), and the CITY OF WATERLOO, IOWA (the "City"). RECITALS A. The City and the Company are parties to the following: (i) that certain Development Agreement dated as of May 5, 2008 (and Minimum Assessment Agreement dated of even date executed by the Company's principal, Kalyana Sundaram, as "Developer," and attached as Exhibit B thereto), and filed in the records of the Black Hawk County Recorder on November 24, 2009 as Document No. 2010-00010498, as amended by that certain First Amendment to Development Agreement dated as of January 9, 2012, and filed in the records of the Black Hawk County Recorder on January 24, 2012 as Document No. 2012-00013692 (collectively, the "2008 Development Agreement"); and (ii) that certain Development Agreement dated as of July 16, 2018 (and Minimum Assessment Agreement dated of even date and attached as Exhibit B thereto), and filed in the records of the Black Hawk County Recorder on August 28, 2018 as Document No. 2019-3366, as amended by that certain Amendment to Development Agreement dated as of October 15, 2018, and filed in the records of the Black Hawk County Recorder on January 28, 2019 as Document No. 2019-11557 (collectively, the "2018 Development Agreement"). 13. The 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 (as hereinafter defined) 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. C. The Company has, prior to the date of this Agreement, financed and constructed buildings and related improvements ("Improvements") on real property legally described on Exhibit A attached hereto (the "Property"), located in the East Waterloo Unified Urban Renewal and Redevelopment Plan Area, formerly known as the Logan Plaza Urban Renewal and Redevelopment Plan Area (the Property and the Improvements constructed thereon by the Company, collectively, the "Project"). D. The City and the Company desire to amend and restate, and this Agreement shall supersede and replace, the 2008 Development Agreement and the 2018 Development Agreement in their entireties. Accordingly, from and after the date of this Agreement, the 2008 Development Agreement and the 2018 Development Agreement shall terminate and be of no further force and effect. AGREEMENT NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: 1. Improvements by the Company. The City and the Company acknowledge and agree that, prior to the date of this Agreement, the Company has completed construction and development of, and satisfied all of its obligations with respect to the construction and development of, the Project, all parts thereof and all work ancillary thereto, including, without limitation, work required to extend water, sewer, telephone, telecommunications, electricity, gas and other utility services from public rights -of -way to locations on the Property and payment of associated connection fees, (a) in accordance with all applicable City, state and federal building codes and in compliance with all applicable City ordinances and other applicable law, and (b) within the timeframes required by the City. 2. Minimum Assessment Agreement. The 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. The Company further agrees that prior to the date set forth in Section 2 of the Minimum Assessment Agreement attached hereto as Exhibit B (the "Minimum Assessment Agreement"), it will not seek or cause a reduction in the taxable valuation for the Property, which shall be fixed for assessment purposes, below the amount of $3,701,320.00 (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. The Company has executed the Minimum Assessment Agreement concurrently herewith. 3. Tax Rebates. In consideration of the Company's financing, development and construction of the Project, the Company has been receiving tax rebates with respect to the Property and other real property prior to the date of this Agreement pursuant to the terms of the 2008 Development Agreement and the 2018 Development Agreement. The City agrees to continue to rebate property taxes with respect to the Property (with the exceptions noted below) as follows: a. Year One through Year Five: 50% rebate each year for any taxable value over the January 1, 2018 value of $2,601,320.00 (each such payment is a "Rebate"). Rebates are payable in respect of a given year only to the extent that (1) Company has actually paid general property taxes due and owing for such year and (2) the City council has made an appropriation for payment of the Rebate. To receive rebates for a given year, Company must, within twelve (12) months after the tax payment due date, submit a completed rebate request to City on the form provided by or otherwise satisfactory to City, or the rebate shall be forfeited. b. The taxable value of the Property as a result of the Improvements must be increased by a minimum of 10% and must increase the annual tax by a minimum of $500.00. This rebate program is not applicable to any special assessment levy, debt service levy, or any other levy that is exempted from treatment as tax increment financing under the provisions of applicable law. c. The first year of in which a rebate may be given ("Year One") shall be the first full year for which the assessment is based upon the completed value of the Improvements, and not based on a prior 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 the Improvements or a partial tax year. For purposes hereof, "Year One" shall mean January 1, 2019. Notwithstanding anything to the contrary contained in this Agreement (including, without limitation, Section 14 hereof), the parties agree that (i) the right to receive Rebates and any other incentive payments payable under this Agreement, and the obligations in connection with such Rebates, shall be personal to Avita Developments, LLC ("Original Company"), as the original Company under this Agreement, and shall not inure to the benefit, or become the obligation, as applicable, of any successor owner of the Property, (ii) Original Company shall not assign any of its right, title and interest in and to any Rebates or other incentive payments under this Agreement, or any obligations in connection with such Rebates, to any successor owner of the Property. 4. Limitations on Payment of Rebates. a. Each payment of a Rebate is subject to annual appropriation by the city council each fiscal year. 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 City in this paragraph is intended by the parties, and shall be construed at all times, so as to ensure that City's obligation to make future payments of Rebates shall not constitute a legal indebtedness of 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 City's bond counsel to create, or result in the creation of, such a legal indebtedness of 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 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 3 hereof, City shall have no obligation to make a payment of a Rebate to Company if at any time during the term hereof (1) City fails to appropriate funds for payment; (2) 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 3 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 City under Iowa Code Chapter 403 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 (3) 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, 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 3 then City may terminate this Agreement, without penalty or other liability to 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 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. 5. Conditions to City Funding. The complete or initial funding by City of the Rebates and other Project commitments shall be deemed an agreement of the parties that the applicable conditions to disbursement of funds as set forth in Section 4 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 a Rebate 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 a Rebate payment date, it being understood that each party shall nonetheless incur costs and liabilities prior thereto 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 a Rebate payment date and agree to indemnify and hold each other harmless therefrom. 6. Representations and Warranties of City. City hereby represents and warrants as follows: a. City is not prohibited from consummating the transaction contemplated in this Agreement by any law, regulation, agreement, instrument, restriction, order or judgment. b. Each person who executes and delivers this Agreement and all documents to be delivered hereunder is and shall be authorized to do so on behalf of City. 7. Representations and Warranties of Company. Company hereby represents and warrants as follows: a. Company is not prohibited from consummating the transaction contemplated in this Agreement by any law, regulation, agreement, instrument, restriction, order or judgment. b. Company is duly organized, validly existing, and in good standing under the laws of the state of its organization and is duly qualified and in good standing under the laws of the State of Iowa. c. Company has full right, title, and authority to execute and perform this Agreement and to consummate all of the transactions contemplated herein, and each person who executes and delivers this Agreement and all documents to be delivered to City hereunder is and shall be authorized to do so on behalf of Company. 8. 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. 9. 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 3904 Alexis Blvd., Cedar Falls, Iowa 50613, Attention: Kalyana Sundaram. 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. 10. 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. 11. 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. 12. Severability. Each provision, section, sentence, clause, phrase, and word of this Agreement is intended to be severable. If any portion of this Agreement shall be deemed invalid or unenforceable, whether in whole or in part, the offending provision or part thereof shall be deemed severed from this Agreement and the remaining provisions of this Agreement shall not be affected thereby and shall continue in hill force and effect. lf, 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. 13. 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. 14. Binding ;Effect. Except as otherwise expressly provided in Section 3, this Agreement shall be binding and shall inure to the benefit of the parties and their respective successors, assigns, and legal representatives, including, but not limited to, future owners of the Property. 15. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. 16. 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. 17. Time of Essence. Time is of the essence of this Agreement. 18. Termination. This Development Agreement and the Minimum Assessment Agreement attached hereto shall each automatically terminate and be of no further force and effect on December 31, 2029, without the requirement of any further action by the parties hereto. Upon any early termination of this Agreement, whether pursuant to Section 4(b), Section 5, or otherwise, the Minimum Assessment Agreement shall concurrently terminate, the parties shall execute an agreement evidencing the termination of this Agreement and the Minimum Assessment Agreement, and shall record the same in the records of the Black Hawk County Recorder. [Signature page follows] IN WITNESS WHEREOF, the parties have executed this Development Agreement by their duly authorized representatives as of the date first set forth above. CITY: CITY OF WATERLOO, IOWA By DiouLA.<1A, Attest: Quentin Hart, Mayor Kelley Felchle, ity Clerk COMPANY: AVITA DEVELOPMENTS, LLC, an Iowa limited liability company By: Name: Kei yarn 514not^raw, Title: Ma 6.45cR. Q1 ACCEPTED AND AGREED: KAYYANSUNDARAM, as "Developer" under the Minimum Assessment Agreement attached as Exhibit B to the 2008 Development Agreement [Notary acknowledgments on following page] STATE OF IOWA ) ss. COUNTY OF BLACK HAWK On this aI day ofnt.—. , 2022, before me, a Notary Public a Notary Public in and for the State of Iowa, personally appeared Quentin 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 County, and said Mayor and City Clerk acknowledged said instrument to be the free act and deed of said municipal corporation by it and by them voluntarily executed. STATE OF IOWA ) ss. COUNTY OF BLACK HAWK Subscribed and sworn to before me on KAiyor,w Sm...AAear.. , as Developments, LLC. kUhe 23 Notary Public 2022, by of Avita PAMELA SUE HICKMAN COMMISSION NO. 810344 MY COMMISSION EXPIRES MAY 8, 2024 STATE OF IOWA ) ss. COUNTY OF BLACK HAWK Subscribed and swom to before me on J u hG 23 Sundaram, an individual. ~At• * PAMELA SUE HICKMAN COMMISSION NO. 810344 MY COMMISSION EXPIRES MAY 8, 2024 , 2022, by Kalyana EXHIBIT A LEGAL DESCRIPTION OF THE PROPERTY Real property in the City of Waterloo, County of Black Hawk, State of Iowa, described as follows: Parcel M, more particularly described on Plat of Survey filed December 8, 2021, as Document No. 2022-12003, as corrected by Surveyor's Affidavit filed December 21, 2021, as Document No. 2022-12984, being part of the SW 1/4 of Section 12-89-13, Waterloo, Black Hawk County, Iowa. EXHIBIT B MINIMUM ASSESSMENT AGREEMENT This MINIMUM ASSESSMENT AGREEMENT (this "Agreement") is entered into as of i� _ 2..4:› , 2022, by and among the CITY OF WATERLOO, IOWA (the "City"), AVITA DEVELOPMENTS, LLC, an Iowa limited liability company (the "Company"), and the ASSESSOR FOR BLACK HAWK COUNTY, IOWA (the "Assessor"). WITNESSETH: WHEREAS, on the date hereof the City and Company have entered into a Development Agreement (the "Development Agreement") regarding certain real property described in Exhibit A attached thereto, located in the City; and WHEREAS, pursuant to the Development Agreement, the Company has undertaken and completed the development of the Project (as defined in the Development Agreement) within the City and within the East Waterloo Unified Urban Renewal and Redevelopment Plan Area, formerly known as the Logan Plaza Urban Renewal and Redevelopment Plan Area, of the City; 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) in the Project pursuant to this Agreement and applicable only to the Project, which minimum actual value became effective upon substantial completion of the Project and shall continue to be effective until the termination of this Agreement pursuant to the terms herein, and which is intended to reflect the minimum actual value of the land and buildings at the Project only; and NOW, THEREFORE, the parties hereto, in consideration of the promises, covenants, and agreements made by each other, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, do hereby agree as follows: 1. From and after substantial completion of construction of the Improvements by the Company, the minimum actual taxable value fixed for assessment purposes for the Property and Improvements constructed thereon by the Company as a part of the Project shall not be less than $3,701,320.00 (the "Minimum Actual Value") until termination of this Agreement. The parties hereto agree that substantial completion of construction of the Improvements occurred on or about June 1, 2018. 2. The Minimum Actual Value herein established shall be of no further force and effect, and this Agreement shall automatically terminate, on December 31, 2029, without the requirement of any further action by the parties hereto. Additionally, this Agreement shall automatically terminate upon any early termination of the Development Agreement. 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 to the Project to be reduced below the Minimum Actual Value established herein during the term of this Agreement. 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 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 Improvements, any interruption in, or discontinuance of, the use, occupancy, ownership or operation of the Property or the 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 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 except as expressly provided herein or in the Development Agreement. 5. 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 Improvements determined by any tax official to be applicable to the Property or the 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 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 of the Minimum Actual Value through any other proceedings. 6. This Agreement shall be promptly recorded by the City with the Recorder of Black Hawk County, Iowa. 7. Neither the preambles nor provisions of this Agreement are intended to, or shall be construed as, modifying the terms of the Development Agreement. 8. Except as otherwise expressly provided in the Development Agreement, 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 Property. 9. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Development Agreement. 10. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. [Signature pages follow] 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: CITY OF WATERLOO, IOWA By: Attest: COMPANY: AVITA DEVELOPMENTS, LLC, an Iowa limited liability company By: Name: Title: 1(411 $u0,4 a VA pry [Signatures and notary acknowledgments continued on following pages] STATE OF IOWA COUNTY OF BLACK HAWK On this aA day of 2022, before me, a Notary Public a Notary Public in and for the State of Iowa, personally appeared Quentin 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 County, 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. NANCY HIGBY COMMISSION NO.788229 MY Cx81+1i I .SIOVt AE STATE OF IOWA COUNTY OF BLACK HAWK ) ) ss. Subscribed and sworn to before me on 4V I 71it 14414 v YV1 Developents, LLC. PAMELA SUE HICKMAN COMMISSION NO. 810344 MY COMMISSION EXPIRES MAY 8, 2024 ,j vvre �3 as Nt tn.Ai) OP' , 2022, by of Avita CERTIFICATION OF ASSESSOR The undersigned having reviewed the improvements constructed and the market value assigned to the land upon which the improvements were constructed at the time of such construction, and being of the opinion that the minimum market value contained in the foregoing Minimum Assessment Agreement appears reasonable as of such date of construction, hereby certifies as follows: The undersigned Assessor, being legally responsible for the assessment of the property subject to the development, certifies that the actual value assigned to such land, building and equipment upon completion of the development shall not be less than Three Million, Seven Hundred One Thousand, Three Hundred Twenty and No/100 Dollars ($3,701,320.00) until termination of this Minimum Assessment Agreement pursuant to the terms hereof. ASSESSOR FOR BLACK HAWK COUNTY, IOWA By: Name: Title: 1_• K..4.4,y- e_t Arrerye. STATE OF IOWA COUNTY OF BLACK HAWK Subscribed and sworn to before ) ss. me on JU ("N a?j , 2022, by , Assessor for Black Hawk County, Iowa. )otary Public