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HomeMy WebLinkAboutHilton Garden Inn Agreement\ ~ & 11111111 ~llll lll lllll lllll lllll lllll lllll lllll lllll lllll lllll lllll lllll llll llll STATE OF IOWA ) Doc ID: 025914920035 Type: GEN Kind: AGREEMENT Recorded: 03/31/2015 at 01:41:23 PM Fee Amt: $177.00 Page 1 of 35 Johnson county Iowa Kirn Painter County Recorder BK534 7 PG628-662 ) SS JOHNSON COUNTY ) I, Marian K. Karr, City Clerk of Iowa City, Iowa, do hereby certify that the Resolution attached hereto is a true and correct copy of Resolution No.15-87 which was passed by the City Council oflowa City, Iowa, at a regular meeting held on the 23rd day of March, 2015, all as the same appears of record in my office. Dated at Iowa City, Iowa, this 26th day of March, 2015. CORPORA 1 £ SEAL Marian K. Karr City Clerk \res 410 EAST WASHINGTON STREET • IOWA CITY, IOWA 52240-1826 • (319) 356-5000 • FAX (319) 356-5009 Prepared by Wendy Ford, Econ. Dev. Coordinator, 410 E Washington St Iowa City IA 52240 356-5248 RESOLUTION NO. 15-87 RESOLUTION APPROVING AN AGREEMENT FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE CITY OF IOWA CITY, IOWA, AND IOWA CITY HOTEL ASSOCIATES, L.L.C. WHEREAS, Iowa City Hotel Associates, L.L.C. ("Developer") submitted a private redevelopment proposal for a Hilton Garden Inn Hotel Conference Center and Rooftop Venue to be developed at 328 S. Clinton Street, Iowa City, which proposal consists a 12 story hotel with approximately 140 rooms, conference space and a rooftop patio (hereinafter the "Project"), and requested the City's financial assistance for said Project; and WHEREAS, this property is located within the City-University Project 11 Urban Renewal Area Amendment #10, and subject to the City-University Project 1 Urban Renewal Plan approved by City Council on October 23, 2012 (resolution 12-459) which plan has been modified and amended from time to time ("Plan"); and WHEREAS, the Economic Development Committee considered said application and voted to recommend approval to the City Council at its meeting on January 12, 2015; and WHEREAS, City Staff has reviewed the application and proposed Developer's Agreement and recommends approval to the City Council; and WHEREAS, in exchange for the grant funds, the property owner has agreed to complete minimum improvements consisting of at least $33,200,000 in project costs, which is intended to increase the actual assessed value to $15, 120,000; and will operate the hotel in accordance with certain environmental standards; and WHEREAS, a member of the development team also owns the adjacent parcel upon which the University of Iowa Museum of Art is proposed to be built, and that parcel may have taxable value from which taxable increment may be available, a portion of which, if diverted to this project, would reduce the time required to reach the total economic development grant; and WHEREAS, it is the determination of this City Council that acceptance of the proposal of the Developer and approval of the Agreement for Private Redevelopment is in the public interest of the residents of the City and is consistent with the purposes and objectives of the Plan. NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY IOWA THAT 1. That the attached Agreement for Private Redevelopment by and between the City of Iowa City Iowa and Iowa City Hospitality Associates, L.L.C. is in the public interest of the residents of Iowa City and is hereby approved. 2. That said Agreement is consistent with and authorized by the Urban Renewal Plan and all applicable State and federal laws including but not limited to Iowa Code Chapters 15A and 403; and /0 Page 2 3. That the Mayor is authorized and directed to execute the Agreement and the City Clerk is authorized and directed to attest his signature and to affix the seal of the City Clerk. 4. That the Mayor and City Clerk be and they are hereby authorized and directed to take all such actions and do all such things as they shall determine to be necessary or appropriate to ensure the City's performance as provided therein. 5. That the City Manager is hereby authorized to administer the terms of the Agreement for Private Redevelopment. Passed and approved this 23rd day of March I 2015. Approved by ATTEST: 22~ ~ K~ CITY LERK At«~~ .,, City Attorney's Office j/; J/r J- CORPORATE SEAL Resolution No. 15-87 ---------JP age 3 It was moved by Mims and seconded by _~T=h-r~P-~-o~r~C~P-Il~--the Resolution be adopted, and upon roll call there were: AYES: NAYS: x x x x x x x ABSENT: Botchway Dickens Dobyns Hayek Mims Payne Tbrogmorton AGREEMENT FOR l'RJVATE REDEVELOPMENT By and Among Tiili CJTY OF IOWA CITY, IOWA, IOWA CITY HOTEL ASSOCIATES, L.L.C. THIS AGREEMENT FOR PRIV ~ TE REDEVELOPMENT (hereinafter called "Agreement"), is made on or as of the 2..·y-»-day of rY\r:Jt. t( h , 2015, by and among the CITY OF IOWA CITY, IOWA, a municipality (hereinafter called ''City"), established pursuant to the Code of Iowa of the State oflowa and acting under the authorization of Chapter 1 SA and Chapter 403 of the Code oflowa, 2015, as amended (hereinafter called "Urban Renewal Act") and Iowa City Hotel Associates, L.L.C. having an office for the transaction of business at 2 Quail Creek Circle, J\j'orth Liberty, Iowa, 52317 (the "Developer"). WID-i'ESSETH: WHEREAS, in furtherance of the objectives of the Urban Renewal Act, the City has undertaken a program for the clearance and reconstruction or rehabilitation of certain areas in the City and has undertaken an economic development area in the City; and WHEREAS, on October 2, 1969, the Iowa City City Council adopted Resolution No. 2157 approving the City-University Project I Urban Renewal Plan (Project No. IA R-14 ), which plan has been modified and amended from time to time (said plan, as amended, is hereinafter referred to as the "Urban Renewal Plan" or "Plan"); and WHEREAS, a copy of the foregoing Urban Renewal Plan, as amended, has been recorded among the land records in the office of the Recorder of Johnson County, Iowa; and WHEREAS, the Developer owns or has the right to occupy certain real property located in the foregoing Urban Renewal Area at 328 S. Clinton Street, Iowa City, Iowa, as more particularly described in Exhibit A annexed hereto and made a part hereof (hereinafter "the Property"); and WHEREAS, the Developer desires to construct a 12-story, 144-room hotel, as further described in Exhibit D "Minimum Improvements and Uses," (hereinafter, "the Project") on the Property, and cause the same to be operated in accordance with this Agreement; and WHEREAS, by Resolution No. 15-~ dated 3,/1,; , 2105, the Urban Renewal Plan for the City-University Project I Urban Renewal Area was amended to include a developer's agreement for this Project as an Urban Renewal Project in furtherance of the goals and objectives of the Urban Renewal Plan and the City's Comprehensive Plan WHEREAS, the City has determined the Project is consistent with and authorized by the Urban Renewal Plan and all applicable State and federal laws, including but not limited to Iowa Code Chapters I SA, 423A, and 403, as well as the goals of the Downtown and Riverfront Crossings Master Plan; and WHEREAS, the City believes that the development and continued operation of the Property pursuant to this Agreement and the fulfillment generally of this Agreement, are in the vital and best 2 interests of the City and in accord with the Urban Renewal Plan and the public purposes and provisions of the applicable State and local laws and requirements under which the foregoing project has been undertaken and is being assisted. NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: ARTICLE I. DEFINITIONS Section 1.1. Definitions. In addition to other definitions set forth in this Agreement, all capitalized terms used and not otherwise defined herein shall have the following meanings unless a different meaning clearly appears from the context: Agreement means this Agreement and all exhibits and appendices hereto, as the same may be from time to time modified, amended or supplemented. Certificate of Completion means a certification in the form of the certificate attached hereto as Exhibit C and hereby made a part of this Agreement, provided to the Developer pursuant to Section 3.2 of this Agreement. City means the City oflowa City, Iowa, or any successor to its functions. Code means the Code oflowa, 2015, as amended. Construction Plans means the plans, specifications, drawings and related documents reflecting the construction work to be performed by the Developer on the Development Property and the other properties upon which the Public Improvements will be located; the Construction Plans shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the building inspector of the City as required by applicable City codes. County means the County of Johnson, Iowa. Developer means Iowa City Hotel Associates, L.L.C. Development Property means that portion of the City-University Project I Urban Renewal Area of the City described in Exhibit A hereto. Economic Development Grants mean the payments to be made by the City to the Developer under Article VIII of this Agreement. Event of Default means any of the events described in Section 10.1 of this Agreement. 3 First Mortgage means any Mortgage granted to secure any loan made pursuant to either a mortgage commitment obtained by the Developer from a commercial lender or other financial institution to fund any portion of the construction costs and initial operating capital requirements of the Minimum Improvements, or all such Mortgages as appropriate. 328 CLINTON TIF Account means a separate account within the City-University Project I Urban Renewal Tax Increment Revenue Fund of the City, in which there shall be deposited all Tax Increments received by the City with respect to the Minimum Improvements on the Development Property described in Exhibit A, as well as 5 0% of any tax revenues collected pursuant to Iowa Code Section 423A.7 solely from operation of the hotel constructed pursuant to this Agreement. Minimum Improvements shall mean the construction of a 12-story, steel-framed, approximately 144-room Hilton Garden Inn hotel, together with all related site improvements and amenities, as described in Exhibit B hereto. Minimum Improvements shall not include increases in assessed or actual value due to market factors. Mortgage means any mortgage or security agreement in which the Developer has granted a mortgage or other security interest in the Development Property, or any portion or parcel thereof, or any improvements constructed thereon. Net Proceeds means any proceeds paid by an insurer to the Developer under a policy or policies of insurance required to be provided and maintained by the Developer, as the case may be, pursuant to Article V of this Agreement and remaining after deducting all expenses (including fees and disbursements of counsel) incurred in the collection of such proceeds. Ordinance means Ordinance No. 01-3991 of the City, under which the taxes levied on the taxable property in the City-University Project I Urban Renewal Area shall be divided and a portion paid into the City-University Project I Urban Renewal Tax Increment Revenue Fund. Project shall mean the construction and operation of the Minimum Improvements on the Development Property, as described in this Agreement. State means the State of Iowa. City-University Project I Urban Renewal Tax Increment Fund means the special fund of the City created under the authority of Section 403.19(2) of the Code and the Ordinance, which fund was created in order to pay the principal of and interest on loans, monies advanced to or indebtedness, whether funded, refunded, assumed or otherwise, including bonds or other obligations issued under the authority of Section 403. 9 or 403 .12 of the Code, incurred by the City to finance or refinance in whole or in part projects undertaken pursuant to the City-University Project I Urban Renewal Plan, as amended. 4 Tax Increments means the property tax revenues with respect to the Minimum Improvements that are divided and made available to the City for deposit in the City-University Project I Urban Renewal Tax Increment Revenue Fund under the provisions of Section 403.19 of the Code and the Ordinance. Termination Date means the date of termination of this Agreement, as established in Section 12.8 of this Agreement. Unavoidable Delays means delays resulting from acts or occurrences outside the reasonable control of the party claiming the delay including but not limited to storms, floods, fires, explosions or other casualty losses, unusual weather conditions, strikes, boycotts, lockouts or other labor disputes, delays in transportation or delivery of material or equipment, litigation commenced by third parties, or the acts of any federal, State or local governmental unit ( other than the City). Urban Renewal Plan means the City-University Project I Urban Renewal Plan, as amended, approved in respect of the City-University Project I Urban Renewal Area, described in the preambles hereof. 314 CLINTON TIF Account means a separate account within the City-University Project I Urban Renewal Tax Increment Revenue Fund of the City, in which there shall be deposited $250,000 in tax increments received by the City with respect to the increase in assessed value from the January 1, 2016 assessed value once and for so long as the land and improvements on the property described in Exhibit F (''the 314 S. Clinton Street property") reaches an assessed value of $18,600,000 and $500,000 in tax increments are generated therefrom. ARTICLE II. REPRESENTATIONS AND WARRANTIES Section 2.1. Representations and Warranties of the City. The City makes the following representations and warranties: (a) The City is a municipal corporation and political subdivision organized under the provisions of the Constitution and the laws of the State and has the power to enter into this Agreement and carry out its obligations hereunder. (b) 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 breach of, the terms, conditions or provisions of any contractual restriction, evidence of indebtedness, agreement or instrument of whatever nature to which the City is now a party or by which it is bound, nor do they constitute a default under any of the foregoing. Section 2.2. Covenants, Obligations, Representations and Warranties of Developer. The Developer makes the following representations and warranties: 5 (a) Developer is a Iowa corporation duly organized and validly existing under the laws of the State oflowa and has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as presently proposed to be conducted, and to enter into and perform its obligations under the Agreement. (b) This Agreement has been duly and validly authorized, executed and delivered by the Developer and, assuming due authorization, execution and delivery by the City, is in full force and effect and is a valid and legally binding instrument of the Developer 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. (c) 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 certificate of incorporation and bylaws of Developer or its parents or subsidiaries of any contractual restriction, evidence of indebtedness, agreement or instrument of whatever nature to which the Developer is now a party or by which it or its property is bound, nor do they constitute a default under any of the foregoing. ( d) There are no actions, suits or proceedings pending or threatened against or affecting the Developer 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 the Developer or which in any manner raises any questions affecting the validity of the Agreement or the Developer's ability to perform its obligations under this Agreement. ( e) Developer has not received any notice from any local, State for federal official that the activities of Developer with respect to the Development Property may or will be in violation of any environmental law or regulation (other than those notices, if any, of which the City has previously been notified in writing). Developer is not currently aware of any State or federal claim filed or planned to be filed by any party relating to any violation of any local, State or federal environmental law, regulation or review procedure applicable to the Development Property, and Developer is not currently aware of any violation of any local, State or federal environmental law, regulation or review procedure which would give any person a valid claim under any State or federal environmental statute with respect thereto. (f) Developer will cooperate with the City in resolution of any traffic, parking, trash removal, excessive noise or public safety problems which may arise in connection with the construction and operation of the Minimum Improvements. 6 (g) Developer would not undertake its obligations under this Agreement without the payment by the City of the Economic Development Grants being made to the Developer pursuant to this Agreement. (h) The Developer will cause the Minimum Improvements to be constructed in accordance with the terms of this Agreement and when constructed will comply with the Urban Renewal Plan and all local, State and federal laws and regulations, except for variances that may be necessary to construct the Minimum Improvements. (i) The Developer 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 in connection with the Project. G) The Developer shall not, prior to the expiration of this agreement, cause or voluntarily permit the Development Property and/or Minimum Improvements to become other than taxable property by applying for or seeking any industrial property tax exemption, by being owned by a utility or any other entity of a type where the assessed value of taxable property of such entity is not treated as located within the Development Property, by being owned by any entity having tax exempt status or by applying for or seeking for a deferral, abatement or exemption from property tax pursuant to any present or future statute or ordinance. ARTICLE III. DEVELOPMENT Ai"\lO OCCl}PANCY REQUIREMENT Section 3.1. Minimum Improvements. The Developer agrees to complete the Minimum Improvements generally consisting of construction of a 12-story Hilton Garden Inn hotel with 144 bedrooms, a meeting/event center, a roof top food and beverage venue, a restaurant, and a pool/spa/fitness area, all as described more fully on Exhibit B ("Minimum Improvements") attached hereto and incorporated herein by this reference. The Redeveloper hereby commits to a Project that includes a minimum total of $33,205,936 in project costs. By January 1, 2018, the construction of the Minimum Improvements must increase the actual assessed value of the Development Property to at least $15, 120,000. Section 3 .2. Certificate of Completion. Upon written request of the Developer after issuance of an occupancy permit for the Minimum Improvements, the City will furnish the Developer with a Certificate of Completion in substantially the form set forth in Exhibit C attached hereto. Such Certificate of Completion shall be a conclusive determination of satisfactory termination of the covenants and conditions of this Agreement solely with respect to the obligations of the Developer to construct such portion of the Minimum Improvements. 7 A Certificate of Completion may be recorded in the proper office for the recordation of deeds and other instruments pertaining to the Development Property at the Developer's sole expense. If the City shall refuse or fail to provide a Certificate of Completion in accordance with the provisions of this Section 3.2, the City shall within twenty (20) days after written request by the Developer, provide the Developer with a written statement indicating with adequate detail, in what respects the Developer has failed to complete the Minimum Improvements in accordance with the provisions of this Agreement, or is otherwise in default under the terms of this Agreement, and what measures or acts will be necessary in the opinion of the City, to obtain such Certificate of Completion. ARTICLE IV. RESERVED ARTICLE V. INSURANCE Section 5 .1. Insurance Requirements. (a) Upon completion of construction of the Minimum Improvements and at all times prior to the Termination Date, the Developer shall maintain, or cause to be maintained, at its cost and expense (and from time to time at the request of the City shall furnish proof of the payment of premiums on) insurance as follows: (i) Insurance against loss and/or damage to the Minimum Improvements under a policy or policies covering such risks as are ordinarily insured through property policies against risk by similar businesses, including (without limitation the generality of the foregoing) fire, extended coverage, vandalism and malicious mischief, explosion, water damage, demolition cost, debris removal, and collapse in an amount not less than the full insurable replacement value of the Minimum Improvements, but any such policy may have a deductible amount of not more than $250,000. No policy ofinsurance shall be so written that the proceeds thereof will produce less than the minimum coverage required by the preceding sentence, by reason of co-insurance provisions or otherwise, without the prior consent thereto in writing by the City. The term "full insurable replacement value" shall mean the actual replacement cost of the Minimum Improvements (excluding foundation and excavation costs and costs of underground flues, pipes, drains and other uninsurable items) and equipment, and shall be determined from time to time at the request of the City, but not more frequently than once every three years, by an insurance consultant or insurer selected and paid for by the Developer and approved by the City. (ii) Comprehensive general public liability insurance, including personal injury liability for injuries to persons and/or property, including any injuries resulting from the operation of automobiles or other motorized vehicles on or about the Development Property, in the minimum amount for each occurrence and for each year of $1,000,000. (iii) Such other insurance, including worker's compensation insurance respecting all employees of the Developer, in such amount as is customarily carried by like organizations engaged 8 in like activities of comparable size and liability exposure; provided that the Developer may be self- insured with respect to all or any part of its liability for worker's compensation. (b) All insurance required by this Article V to be provided prior to the Termination Date shall be taken out and maintained in responsible insurance companies selected by the Developer which are authorized under the laws of the State oflowa to assume the risks covered thereby. The Developer will deposit annually with the City copies of policies evidencing all such insurance, or a certificate or certificates or binders of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Article V, each policy shall contain a provision that the insurer shall not cancel or modify it without giving written notice to the Developer and the City at least thirty (30) days before the cancellation or modification becomes effective. Not less than fifteen (15) days prior to the expiration of any policy, the Developer shall furnish the City evidence satisfactory to the City that the policy has been renewed or replaced by another policy conforming to the provisions of this Article V, or that there is no necessity therefor under the terms hereof. In lieu of separate policies, the Developer may maintain a single policy, or blanket or umbrella policies, or a combination thereof, which provide the total coverage required herein, in which event the Developer shall deposit with the City a certificate or certificates of the respective insurers as to the amount of coverage in force upon the Minimum Improvements. ( c) The Developer agrees to notify the City as soon as reasonably possible in the case of damage exceeding $250,000 in amount to, or destruction of, the Minimum Improvements or any portion thereof resulting from fire or other casualty. Net Proceeds of any such insurance shall be paid directly to the Developer, and the Developer will forthwith repair, reconstruct and restore the Minimum Improvements to substantially the same or an improved condition or value as they existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restoration, the Developer will apply the Net Proceeds of any insurance relating to such damage received by the Developer to the payment or reimbursement of the costs thereof. ( d) The Developer shall complete the repair, reconstruction and restoration of the Minimum Improvements, whether the Net Proceeds ofinsurance received by the Developer for such purposes are sufficient. ARTICLE VI. COVEN~~TS OF THE DEVELOPER Section 6.L Maintenance of Properties. The Developer will maintain, preserve and keep the Minimum Improvements in good repair and working order, ordinary wear and tear accepted, and from time to time will make all necessary repairs, replacements, renewals and additions. Section 6.2. Maintenance of Records. The Developer will keep at all times proper books of record and account in which full, true and correct entries will be made of all dealings and transactions of or in relation to the business and affairs of the Developer in accordance with generally accepted accounting principles, consistently applied throughout the period involved, and 9 the Developer will provide reasonable protection against loss or damage to such books of record and account. Section 6.3. Compliance with Laws. The Developer will comply with all laws, rules and regulations relating to the Minimum Improvements, other than laws, rules and regulations the failure to comply with which 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 the Developer. Section 6.4. Non-Discrimination. In operating the Minimum Improvements, the Developer shall not discriminate against any applicant, employee or tenant because of race, creed, color, religion, sex, national origin, sexual orientation, age, disability, marital status or gender identity. The Developer shall ensure that applicants, employees and tenants are considered and are treated without regard to their race, creed, color, religion, sex, national origin, sexual orientation, age, disability, marital status or gender identity. Section 6.5. RESERVED. Section 6.6. Annual Certification. To assist the City in monitoring and performance of the Developer hereunder, a duly authorized officer of the Developer shall annually provide to the City: (a) proof that all ad valorem taxes on the Development Property have been paid for the prior fiscal year; and (b) certification that such officer has examined the terms and provisions of this Agreement and that at the date of such certificate, and the Developer is not, and was not during the preceding twelve (12) months, in default in the fulfillment of any of the terms and conditions of this Agreement and that no Event of Default (or event which, with the lapse of time or the giving of notice, or both, would become an Event of Default) is occurring or has occurred as of the date of such certificate or during such period, or if the signer is aware of any such default, event or Event of Default, said officer shall disclose in such statement the nature thereof, its period of existence and what action, if any, has been taken or is proposed to be taken with respect thereto. Such statement, proof and certificate shall be provided not later than November 1 of each year, commencing ~ovember 1, 2017, and ending on November 1, 2038, both dates inclusive. Upon certification by the Developer on or before November 1, 2017, the City will certify to establish a base value for both the Development Property and the 314 S. Clinton Street property as of January 1, 2016. Section 6. 7 Quarterly Certification. Prior to distribution to the Developer of any amounts from the 328 CLINTON TIF Account deposited therein as a result of taxes collected pursuant to Iowa Code Section 423A.7 and this Agreement, Developer shall quarterly provide to the City: (a) proof that all hotel-motel taxes on the Development Property collected pursuant to Iowa Code Section 423A.7 have been paid for the prior quarter; and (b) certification that such officer has examined the terms and provisions of this Agreement and that at the date of such certificate, and the Developer is not, and was not during the preceding twelve (12) months, in default in the fulfillment of any of the tenns and conditions of this Agreement and that no Event of Default ( or event which, with the lapse of time or the giving of notice, or both, would become an Event of Default) is 10 occurring or has occurred as of the date of such certificate or during such period, or if the signer is aware of any such default, event or Event of Default, said officer shall disclose in such statement the nature thereof, its period of existence and what action, if any, has been taken or is proposed to be taken with respect thereto. Such statement, proof and certificate shall be provided not later than January 31, April 30, July 31, and November 1 of each year, commencing January 31, 2017, and ending on November 1, 2038, both dates inclusive. This quarterly certification shall be in a form set forth in Exhibit E hereto. The Parties acknowledge that the Annual Certification, the form of which is set forth in Exhibit D hereto, may be filed in satisfaction of the November 1 Quarterly Certification obligation. Section 6.8 Taxation of Development Property. The Developer shall not, prior to the expiration of this agreement, cause or voluntarily permit the Development Property and/or Minimum Improvements to become other than taxable property by applying for or seeking any property tax exemption, by being owned by a utility or any other entity of a type where the assessed value of taxable property of such entity is not treated as located within the Development Property, by being owned by any entity having tax exempt status or by applying for or seeking for a deferral, abatement or exemption from property tax pursuant to any present or future statute or ordinance. ARTICLE VII. ASSIGNMENT AND TRANSFER Section 7 .1. Status of the Developer; Transfer of Substantially All Assets. As security for the obligations of the Developer under this Agreement, the Developer represents and agrees that, prior to the issuance of the Certificate of Completion and prior to the Termination Date, the Developer will maintain existence as an adequately-capitalized corporation and will not wind up or otherwise dispose of all or substantially all of the Development Property and Minimum Improvements, or assign its interest in this Agreement to any other party unless (i) the transferee partnership, corporation, limited liability company or individual assumes in writing all of the obligations of the Developer under this Agreement and (ii) the City consents thereto in writing in advance thereof, in which case the Developer may be released of its obligations hereunder. Notwithstanding the foregoing, however, or any other provisions of this Agreement, (a) Developer may transfer its interest in and to this Agreement to any affiliate which is controlled by, under common control with or controls Developer or to any entity that acquires all or substantially all of the assets of the Developer or to any corporate successor to Developer by consolidation, merger, or otherwise, and (b) the Developer may (1) pledge any and/or all of its assets or its right to payment under this agreement as security for any financing of the Minimum Improvements; (2) assign its rights under this Agreement to a third party, provided such assignment shall not release the Developer of its obligations hereunder, and the City agrees in writing that Developer may assign its interest under this Agreement for such purpose; and (3) the Developer may transfer its ownership interest to a third- party under an arrangement whereby Developer will lease the Development Property back and continue to satisfy the requirements of this Agreement. ARTICLE VIII. ECONOMIC DEVELOPMENT GRANTS 11 Section 8.1. Economic Development Grants. (a) For and in consideration of the obligations being assumed by the Developer hereunder, and in furtherance of the goals and objectives of the Urban Renewal Plan and the Urban Renewal Act, the City agrees to make up to twenty-one (21) annual Economic Development Grants to the Developer, subject to the Developer having received a Certificate of Completion and being and remaining in compliance with the terms of this Agreement and subject to the terms of this Article VIII. The total, aggregate amount of all Economic Development Grants under this Agreement shall not exceed $8,800,000. The annual grants shall commence on June 1, 2020 and end on June 1, 2040, or when the total of all grants is equal to $8,800,000, whichever is earlier. to: Unless the total grant amount of $8,800,000 is reached first, all annual grants shall be equal (i) one hundred percent (100%) per fiscal year of the Tax Increments collected by the City with respect to the Minimum Improvements on Development Property pursuant to Section 403.9 of the Urban Renewal Act under the terms of the Ordinance (without regard to any averaging that may otherwise be utilized under Section 403.19 and excluding any interest that may accrue thereon prior to payment to the Developer) during the preceding twelve- month period in respect of the Development Property and the Minimum Improvements, but subject to adjustment and conditions precedent as provided in this Article (such payments being referred to collectively as the "Economic Development Grants"); and (ii) 50% per fiscal year of any and all revenues generated solely by the Project arising from the taxes collected by the City pursuant to Iowa Code Section 423A.7 (2015), and (iii) At such time as the property locally known as 314 S. Clinton Street, Iowa City, Iowa, and legally described in Exhibit F attached hereto, has been developed, the assessed value of said property reaches $18,600,000 and the property taxes are actually paid on this assessed value, the City shall make an economic development grant to Developer a maximum of $250,000 per fiscal year of the tax increments deposited into the 314 CLINTON TIF Account. The final Grant shall be adjusted, if necessary, if payment ot' the above-described amounts would result in total, aggregate Economic Development Grants exceeding $8,800,000. (b) The obligation of the City to make an Economic Development Grant to the Developer in any year as specified above shall be subject to and conditioned upon the timely filing by the Developer of all previous annual statements, proofs and certifications required under Section 6.6 hereof and the City Manager's approval thereof, which will not be unreasonably withheld. Beginning with the November 1, 2018 certification, if the Developer's annual statement, proof and certification is timely filed and contains the information required under Section 6.6 and the City Manager approves of the same, the City shall certify to the Johnson County Assessor (the "County") prior to 12 December 1 of that year its request for the available Tax Increments resulting from the assessments imposed by the County as of January 1 of that year, to be collected by the City as taxes are paid during the following fiscal year and which shall thereafter be disbursed to the Developer on June 1 of the following fiscal year. (For example, if the Developer and the City each so certify on November and December 2018, respectively, the first Economic Development Grant would be paid to the Developer on June 1, 2020). With respect to any grant made from the 314 CLINTON TIP Account, once the 314 S. Clinton Street property has an assessed value of at least $18,600,000, the City shall, in its certification to the Johnson County Assessor, request that the tax increment resulting from the assessments imposed by the County as of January 1 of that year, to be collected by the City as taxes are paid during the following fiscal year and which shall thereafter be disbursed to the Developer on June 1 of the following fiscal year. The obligation of the City to make any grant from this fi.mding source is subject to and conditioned upon the generation of at least $500,000 in tax increment from that property. ( c) In the event that the annual statement, proof or certificate required to be delivered by the Developer under Section 6.7 is not delivered to the City by November 1 of any year, the Developer recognizes and agrees that the City may have insufficient time to review and approve the same and certify its request for Tax Increments to the County and that, as a result, no Economic Development Grant may be made to the Developer in respect thereof. The City covenants to act in good faith to appropriately review and consider any late certification on the part of the Developer, but the City shall not be obligated to make any certification to the County for the available Tax Increments or make any corresponding payment of the Economic Development Grant to the Developer if, in the reasonable judgment of the City, it is not able to give appropriate consideration (which may include, but not be limited to, specific discussion before the City Council at a regular City Council meeting with respect thereto) to the Developer's certification due to its late filing. In the event Developer fails to timely file an annual statement, proof or certificate due to an Unavoidable Delay and, as a result, an Economic Development Grant cannot be made, Developer may give written notice to the City and, if the City finds that Developer's failure is due to an Unavoidable Delay, the missed Economic Development Grant shall be made in the year succeeding the last scheduled Economic Development Grant under Section 8.1, subject to Developer's filing under Section 6.6 and all other provisions of this Article Vill with respect to such grant, it being the intention of the parties to allow up to 21 annual Economic Development Grants in an aggregate amount not to exceed $8,800,000, if Developer is in compliance with this Agreement. ( d) Such Economic Development Grants shall at all times be subject to termination in accordance with the terms of this Article VIII and Article X. Thereafter, the taxes levied on the Development Property and Minimum Improvements shall be divided and applied in accordance with the Urban Renewal Act and the Ordinance. It is recognized by all parties that the total aggregate amount set forth above is a maximum amount only and that the actual payment amounts will be determined after the Minimum Improvements are completed and the valuations of said Improvements have been determined by the City Assessor. 13 (e) In the event that any certificate filed by the Developer under Section 6.6 or other information available to the City discloses the existence or prior occurrence of an Event of Default that was not cured or cannot reasonably be cured under the provisions of Section 10 .2 ( or an event that, with the passage of time or giving of notice, or both, would become an Event of Default that cannot reasonably be cured under the provisions of Section 10.2), the City shall have no obligation thereafter to make any further payments to the Developer in respect of the Economic Development Grants and may proceed to take one or more of the actions described in Section 10.2 hereof. Section 8.2. Source of Grant Funds Limited. (a) The Economic Development Grants shall be payable from and secured solely and only by amounts deposited and held in the 328 CLINTON TIF Account and the 314 CLINTON TIF Account of the City. The City hereby covenants and agrees to maintain the Ordinance in force during the term hereof and to apply the incremental taxes collected in respect of the Minimum Improvements and allocated to the 328 CLINTON TIF Account and the 314 CLINTON TIF Account to pay the Economic Development Grants, as and to the extent set forth in Section 8.1 hereof. The Economic Development Grants shall be payable only from those sources described in Section 8.1 hereof, and not in any manner by other tax increment revenues, by general taxation, or from any other City funds. (b) Notwithstanding the provisions of Section 8.1 hereof, the City shall have no obligation to make an Economic Development Grant to the Developer if at any time during the term hereof the City receives an opinion of its legal counsel or a controlling decision of an Iowa court having jurisdiction over the subject matter hereof to the effect that the use of Tax Increments resulting from the Minimum Improvements to fund an Economic Development Grant to the Developer, as contemplated under said Section 8.1, is not authorized or otherwise an appropriate project activity permitted to be undertaken by the City under the Urban Renewal Act or other applicable provisions of the Code, as then constituted. Upon receipt of such an opinion or decision, the City shall promptly forward a copy of the same to the Developer. If the circumstances or legal constraints giving rise to the opinion or decision continue for a period during which two (2) Economic Development Grants would otherwise have been paid to the Developer under the terms of Section 8.1, the City may terminate this Agreement, without penalty or other liability to the Developer, by written notice to the Developer. ( c) The City makes no representation with respect to the amounts that may finally be paid to the Developer as the Economic Development Grants, and under no circumstances shall the City in any manner be liable to the Developer so long as the City timely applies the Tax Increments actually collected and held in the 328 CLINTON TIF Account (regardless of the amounts thereof) to the payment of the Economic Development Grants to the Developer, as and to the extent described in this Article. Section 8.3. Use of Other Tax Increments. Subject to this Article VIII, the City shall be free to use any and all Tax Increments collected in respect of increases in valuation on the Development Property unrelated to construction of the Minimum Improvements (i.e. increases in assessed or actual value due to market factors), any other properties within the Project Area, or any available Tax 14 Increments resulting from the suspension or termination of the Economic Development Grants under Section 8.1 hereof, for any purpose for which the Tax Increments may lawfully be used pursuant to the provisions of the urban Renewal Act, and the City shall have no obligations to the Developer with respect to the use thereof. ARTICLE IX. INDEMNIFICATION Section 9.1. Release and Indemnification Covenants. (a) The Developer releases the City and the governing body members, officers, agents, servants and employees thereof (hereinafter, for purposes of this Article IX, 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 or resulting from any defect in the Minimum Improvements. (b) Except for any willful misrepresentation or any willful or wanton misconduct or any unlawful act of the indemnified parties, the Developer, or its successors or assigns, 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 whatsoever by any person or entity whatsoever arising or purportedly arising from (i) any violation of any agreement or condition of this Agreement (except with respect to any suit, action, demand or other proceeding brought by the Developer against the City to enforce his rights under this Agreement), (ii) the acquisition and condition of the Development Property and the construction, installation, ownership, and operation of the Minimum Improvements or (iii) any hazardous substance or environmental contamination located in or on the Development Property relating to conditions caused by Developer after the effective date of this Agreement. ( c) The indemnified parties shall not be liable for any damage or injury to the persons or property of the Developer or its officers, agents, servants or employees or any other person who may be on or about the Minimum Improvements due to any act of negligence of any person, other than any act of negligence on the part of any such indemnified party or its officers, agents, servants or employees. ( d) All covenants, stipulations, promises, agreements and obligations of the City contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the City, and not of any governing body member, officer, agent, servant or employee of the City in the individual capacity thereof. ( e) The provisions of this Article IX shall survive the termination of this Agreement. ARTICLE X. DEFAULT AND REMEDIES 15 Section 10.1. Events of Default Defined. The following shall be "Events of Default" under this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement, any one or more of the following events: (a) Failure by the Developer to cause the construction of the Minimum Improvements to be commenced and completed pursuant to the terms, conditions and limitations of Article III of this Agreement; (b) Transfer of any interest in this Agreement or the assets of the Developer in violation of the provisions of Article Vll of this Agreement; ( c) Failure by the Developer to substantially observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement; ( d) If the holder of any Mortgage on the Development Property, or any improvements thereon, or any portion thereof, commences foreclosure proceedings as a result of any default under the applicable Mortgage documents; (e) If the Developer shall: (A) fi]e any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act of 1978, as amended, or under any similar federal or state law; or (B) make an assignment for the benefit of its creditors; or (C) admit in writing its inability to pay its debts generally as they become due; or (D) be adjudicated a bankrupt or insolvent; or if a petition or answer proposing the adjudication of the Developer 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 the Developer or the Minimum Improvements, or part thereof, shall be appointed in any proceedings brought against the Developer, and shall not be discharged within ninety (90) days after such appointment, or if the Developer shall consent to or acquiesce in such appointment; or (f) If any representation or warranty made by the Developer in this Agreement, or made by the Developer in any written statement or certificate furnished by the Developer pursuant to this Agreement, shall prove to have been incorrect, incomplete or misleading in any material respect on or as of the date of the issuance or making thereof. 16 (g) Notwithstanding anything to the contrary, however, in the event of an Event of Default pursuant to subparagraphs (d) or (e) above, a Mortgagee who has received an assignment of the Developer's rights pursuant to this Agreement as security as contemplated by Section 7 .1 (b) above, shall have the right, at its option and subject to written agreement with the City, to expressly assume the Developer's obligations to the City pursuant to this Agreement. In said event, said Mortgagee shall be substituted as the Developer for the remainder of the term of this Agreement, the default shall be deemed cured, and the parties shall continue to be bound hereby. Section 10.2. Remedies on Default. Whenever any Event of Default referred to in Section 10.1 of this Agreement occurs and is continuing, the City, as specified below, may take any one or more of the following actions after ( except in the case of an Event of Default under subsections ( d) or (e) of said Section 10.1 in which case action may be taken immediately) the giving of thirty (30) days1 written notice by the City to the Developer and the holder of the First Mortgage (but only to the extent the City has been informed in writing of the existence of a First Mortgage and been provided with the address of the holder thereof) of the Event of Default, but only if the Event of Default has not been cured within said thirty (30) days, or if the Event of Default cannot reasonably be cured within thirty (30) days and the Developer does not provide assurances reasonably satisfactory to the City that the Event of Default will be cured as soon as reasonably possible: (a) The City may suspend its performance under this Agreement until it receives assurances from the Developer, deemed adequate by the City, that the Developer will cure its default and continue its performance under this Agreement; (b) The City may terminate this Agreement; ( c) The City may withhold the Certificate of Completion; ( d) The City may take any action, including legal, equitable or administrative action, which may appear necessary or desirable to enforce performance and observance of any obligation, agreement, or covenant of the Developer, as the case may be, under this Agreement; or ( e) The City shall be entitled to recover from the Developer, and the Developer shall re-pay to the City, an amount equal to the most recent Economic Development Grant previously made to the Developer under Article VIII hereof, and the City may take any action, including any legal action it deems necessary, to recover such amount from the Developer. Section 10.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to the City is intended to be exclusive of any other available remedy or remedies, but each and every remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. 17 Section 10.4. No Implied Waiver. ln the event any agreement contained in this Agreement should be breached by any party and thereafter waived by any other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. Section 10.5. Agreement to Pay Attorneys' Fees and Expenses. Whenever any Event of Default occurs and the party who is not in default shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement or performance or observance of any obligation or agreement on the part of the party in default herein contained, the party in default agrees that it shall, on demand therefor, pay to the party not in default the reasonable fees of such attorneys and such other expenses as may be reasonably and appropriately incurred by the party not in default in connection therewith. ARTICLE XI. OPTION TO TERMINATE AGREEMENT Section 11.1. Option to Terminate. This Agreement may be terminated by the Developer if (i) the Developer is in compliance with all material terms of this Agreement and no Event of Default has occurred which has not been cured in accordance with the provisions of Section 10.2 hereof; and (ii) the City fails to comply with any material term of this Agreement, and, after written notice by the Developer of such failure, the City has failed to cure such noncompliance within thirty (30) days of receipt of such notice, or, if such noncompliance cannot reasonably be cured by the City within thirty (30) days of receipt of such notice, the City has not provided assurances reasonably satisfactory to the Developer that such noncompliance will be cured as soon as reasonably possible. Section 11.2. Effect of Termination. If this Agreement is terminated pursuant to this Article XI, this Agreement shall be from such date forward null and void and of no further effect; provided, however, that the City's rights to indemnification under Article IX hereof shall in all events survive and provided further that the termination of this Agreement shall not affect the rights of any party to institute any action, claim or demand for damages suffered as a result of breach or default of the terms of this Agreement by another party, orto recover amounts which had accrued and become due and payable as of the date of such tennination. In any such action, the prevailing party shall be entitled to recover its reasonable attorneys fees and related expenses incurred in connection therewith (but only, in the case of the City, to the extent permitted by applicable law). Upon termination of this Agreement pursuant to this Article XI, the Developer shall be free to proceed with the construction and operation of the Minimum Improvements at its own expense and without regard to the provisions of this Agreement. 18 ARTICLE XII. MISCELLANEOUS Section 12.1. Conflict of Interest. The Developer represents and warrants that, to its best knowledge and belief after due inquiry, no officer or employee of the City, or its designees or agents, nor any consultant or member of the governing body of the City, and no other public official of the City who exercises or has exercised any functions or responsibilities with respect to the Project during his or her tenure, or who is in a position to participate in a decision-making process or gain insider information with regard to the Project, has had or shall have any interest, direct or indirect, in any contract or subcontract, or the proceeds thereof, for work or services to be performed in connection with the Project, or in any activity, or benefit therefrom, which is part of the Project at any time during or after such person's tenure. Section 12.2. Notices and Demands. A notice, demand or other communication under this Agreement by any party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally, and (a) In the case of the Developer, to 2 Quail Creek Circle, North Liberty, Iowa, 52317, Attn: Ben Kinseth; (b) In the case of the City, to City Hall, 410 E. Washington Street, Iowa City, Iowa, 52240, Attn: City Manager; or to such other designated individual or to such other address as any party shall have furnished to the other in writing in accordance herewith. Section 12.3. Titles of Articles and Sections. Any titles of the several parts, Articles, and Sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 12.4. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 12.5. Governing Law. This Agreement shall be governed and construed in accordance with the laws of the State of Iowa. · Section 12.6. Entire Agreement. This Agreement and the exhibits hereto reflect the entire agreement between the parties regarding the subject matter hereof, and supersedes and replaces all prior agreements, negotiations or discussions, whether oral or written. This Agreement may not be amended except by a subsequent writing signed by all parties hereto. Section 12.7. Successors and Assigns. This Agreement is intended to and shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns. 19 Section 12.8. Termination Date. This Agreement shall tenninate and be of no further force or effect on and after June 1, 2040, or upon final payment of the Economic Development Grants, whichever is sooner. IN WITNESS WHEREOF, the City has caused this Agreement to be duly executed in its name and behalf by its Mayor and its seal to be hereunto duly affixed and attested by its City Clerk, the Developer has caused this Agreement to be duly executed in its name and on its behalf by --:;::---:.:--·- lQ (SEAL) ~,bQ ~~. ~~ CITY OF IOWA CITY, IOWA By: Mayor ~ AfTEST: Approved by: By: )'}~ -J< CityC erk ~·klA.~~~~ City Attorney ?; { 2,(J. ( l ~ ~:WA C~!ATES, L.L.C. CITY OF IOWA CITY STATE OF IOWA COUNTY OF JOHNSON ) ) ) On this '"2..or-6'--day of fY'\.a..rc..h-20~ before me a Notary Public in and for said County, personally appeared Matthew J. Hayek and Marian K. Karr, to me personally known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively of the City oflowa City, 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 voluntarily executed. ~~If'"' I KELLIE K. TUTILE :J? P" -;,comml~n Mumber221B19 (:. JJ r,.1y co tss·on Expires Notary Public in and for the State oflowa L·,~~ L_,__;IJ_;.";J../-J...L~--' 20 STATE OF IOWA COUNTY OF JOHNSON ) )SS ) IOWA CITY HOTEL ASSOCIATES, L.L.C . . ~ By:~~~~~~~~~~~~~~ Bruce Kinseth, Manager This instrument was acknowledged before me on this 17th day of March, 2015, by Michael E. Hodge, as manager of Iowa City Hotel Associates, L.L.C .. No~:oflowa STATE OF IOWA ) )SS COUNTY OF JOHNSON ) This instrument was acknowledged before me on this -:i.5""'aay of March. 2015, by John Hieronymus, as manager of Iowa City Hotel Associates, L.L.C .. ~F.JQ_WA ) ~ )SS COUNTY OF JOHNSON~ ~~~~-Notary P.,ybnc In and for the State of Iowa ._.,,.l!I("" HOLLY RICHARD ~-1 Comm1ss1on Number 783170 • • My Comm1ss1on Expires March 17, 2017 This instrument was acknowledged~ne.on this_ day of March, 2015, by Bruce Kinseth, as manager of Iowa City Hotel Associates, L.L.C .. Notary Public in and for the State allow~ STATE OF IOWA ) )SS IOWA CITY HOTEL ASSOCIATES, L.L.C. By:~~~~~~~~~~~~~ Michael E. Hodge, Manager By:~~~~~~~~·~~~ John Hieronymus, Manager By: ....___,6-..,;..,I.,::.,.._;-=-=-~-=->.._--'=---=-~;:_;._ .. -_...;;....___ Bruce Kinseth, Manager By: _____________ _ Kevin Digmann, Manager "-.cOUNTY OF JOHNSON ) ~ument was acknowledged before me on this 17th day of March, 20151 by Michael E. Hodge, as manager oflow City Hotel Associates, L.L.C .. Notary Public in and for the State of Iowa STATE OF IOWA ) )SS COUNTY OF JOHNSON ) This instrument was acknowledged before me on this _ day of M as manager of Iowa City Hotel Associates, L.L. C .. Notary Public in and for the State of Iowa STATE OF IOWA ) )SS COUNTY OF JOHNSON ) ~J This instrument was acknowledged before me on this ol3 day of March, 2015, by Bruce Kinseth, as manager oflowa City Hotel Associates, L.L.C .. )-~""·-··~-,":...&-~.a-...,~~-,r, -·•-~.._~ j KATHI ELDER f Notmlol Seal -Iowa !.}' Commission# 730271.... ~ '" MyComr.iiss'.onExpfres 2 · ::!;>C .,s~. J .. _ -_.,,,. ' Notary Public in and for the State of Iowa ~ S'f:SE OF IOWA ) )SS IOWA CITY HOTEL ASSOCIATES, L.L.C. By: ___________ _ Michael E. Hodge, Manager By: ____________ _ John Hieronymus, Manager CO l'' OF JOHNSON ) This instru~\.was acknowledged before me on this 17th day of March, 2015, by Michael E. Hodge, as manager oflowa City Hotel Associates, L.L.C .. Notary Public in and for the State of Iowa STATE OF IOWA COUNTY OF JOHNSON This instrument was acknowledged before me~~ this _ day of March, 2015, by John Hieronymus, as manager of Iowa City Hotel Associates, L.L:_.~ .. _:~-· --~----------- Notary PublioJn and for the State of Iowa STATE OF IOWA ) )SS COUNTY OF JOHNSON ) This instrument was acknowledged before me on this _ day of March, 2015;"\by Bruce Kinseth, as manager of Iowa City Hotel Associates, L.L.C.. ~ Notary Public in and for the State of Iowa STATE OF IOWA ) )SS COUNTY OF JOHNSON ) //t'' This instrument was acknowledged before me on this J,;!_ day of March, 2015, by Kevin Digmann, as manager oflowa City Hotel Associates, L.L.C .. ,. ... •~., HOLLY RICHARD fi'. Commission Number 713170 • :; My Commission ExD!AII ~17,2011 EXHIBIT A DEVELOPMENT PROPERTY : The.Development Property is .described as consisting of all that certain parcel or parcels of land located in the City of Iowa City, County of Johnson, State of Iowa, locally known as 328 S. Clinton Street, and more particularly described as follows: The South36:feetofLot 6 and the North 44 feet of Lot 5, in Block 102 in the Original Town of Iowa City, Iowa, according to the plat recorded thereof. 22 EXHIBITB MINIMUM IMPROVEMENTS The Developer agrees to complete Minimum Improvements generally. consisting of at least $33,206,000 project costs in making improvements to the property ,located at328 S. Clinton Street, Iowa City, Iowa, which improvements shall include the construction of a 12-story, steel-framed hotel building. This building shall be comprised of two (2) stories for a hotel lobby, an approximate 2,500 square foot event and meeting room space, a restaurant, :24-hour business center, and a pool/spa/fitness area; ten (10) stories of hotel rooms, for a total of approximately 144 rooms; and a rooftop food and beverage venue. The Developer shall enter into a franchise agreement with the Hilton Garden Inn franchise or, if in the future a Hilton Garden Inn franchise is no longer available, a comparable hotel franchise approved by the City, which approval shall not be unreasonably withheld. The Developer shall participate in Hilton's LightStay sustainability measurement program and Hilton's initiative to designate an employee or committee dedicated to driving sustainability performance and identifying projects to improve performance at their hotels, or said programs' equivalents if Hilton discontinues said programs. The Developer shall coordinate with the Hilton Garden Inn franchisor to implement construction strategies and operational strategies to minimize energy usage, carbon output, waste output and water usage. The project shall be constructed and managed for compliance with ISO 5001 standards for energy management, and ISO 14001 and 9001 standards for environmental management and quality management, and obtain certifications of the same. Any site plan for the Project must be approved by the Riverfront Crossings Form-Based Code Committee prior to issuance of a building permit. The Owner shall donate to the City any property rights minimally necessary to carry out the public purpose of reconstruction of Clinton Street at such time as the City may undertake such a public improvement project. This may include the donation of additional right-of-way or temporary construction easements and shall occur at the time the City completes the design of its project. The parties acknowledge that the extent of this dedication shall be limited to those property rights which the City would have the power to condemn through its exercise of eminent domain pursuant to Iowa Code Chapter 6A. 23 EXHIBITC CERTIFICATE OF COMPLETION WHEREAS, the City oflowa City, Iowa (the "City") and Iowa City Hotel Associates, L.L.C. having an office for the transaction of business at (the "Developer"), did on or about the __ day of , 2015, make, execute and deliver, each to the other, an Agreement for Private Redevelopment (the "Agreement"), wherein and whereby the Developer agreed, in accordance with the terms of the Agreement, to develop and maintain certain real property located within the City and as more particularly described as follows: The South 36 feet of Lot 6 and the North 44 feet of Lot 5, in Block 102 in the Original Town oflowa City, Iowa, according to the plat recorded thereof. WHEREAS, the Agreement incorporated and contained certain covenants and restrictions with respect to the development of the Development Property, and obligated the Developer to construct certain Minimum Improvements (as defined therein) in accordance with the Agreement; and WHEREAS, the Developer has to the present date performed said covenants and conditions insofar as they relate to the construction of said Minimum Improvements in a manner deemed by the City to be in conformance with the approved building plans to permit the execution and recording of this certification. NOW, THEREFORE, pursuant to Section 3.2 of the Agreement, this is to certify that all covenants and conditions of the Agreement with respect to the obligations of the Developer, and its successors and assigns, to construct the Minimum Improvements on the Development Property have been completed and performed by the Developer and are hereby released absolutely and forever terminated insofar as they apply to the land described herein. The County Recorder of Johnson County is hereby authorized to accept for recording and to record the filing of this instrument, to be a conclusive determination of the satisfactory termination of the covenants and conditions of said Agreement with respect to the construction of the Minimum Improvements on the Development Property. All other provisions of the Agreement shall otherwise remain in full force and effect until termination as provided therein. (SEAL) CITY OF IOWA CITY, IOWA Mayor 24 ATTEST: By:~~~~~~~~~~ City Clerk STATE OF row A COlJNTY OF JOHNSON CITY OF row A CITY ) ) ) On this day of , 20_, before me a Notary Public in and for said County, personally appeared Matthew J. Hayek and Marian K. Karr, to me personally known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively of the City oflowa City, 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 voluntarily executed. Notary Public in and for the State of Iowa 25 EXHIBITD A:t\"'NUAL CERTIFICATION Date: ------- ( due annually no later than November 1) I,_' -·--~the undersigned, having knowledge of the Developer's Agreement between the City of Iowa City and Iowa City Hotel Associates, L.L.C., dated , 2015, and the operations of the Development Property, hereby certify the following; 1. All ad valorem taxes on the Development Property have been paid for the prior fiscal year, as evidenced by the attached documentation; and 2. (A) I have re-examined the terms and provisions of the Development Agreement and can affirm that during the preceding twelve (12) months, the Developer is not, or was not, in default in the fulfillment of any of the terms and conditions of said Agreement (including but not limited to the occupancy requirements of Section 3 .3 thereto) and that no Event of Default ( or event which, with the lapse of time or the giving of notice, or both, would become an Event of Default) is occurring or has occurred as of the date of this certificate. OR (B) the undersigned has re-examined the terms and provisions of the Development Agreement and that at the date of this certificate, the undersigned is aware that the Developer is in default of the Agreement for the following reasons· _____________________ _ that the default has existed since (date); and that the Developer is taking or proposes to take the following action with respect thereto: _________________ _ 3. The Development Property is being managed in compliance with ISO 5001 standards for energy management, and ISO 1400 I and 9001 standards for environmental management and quality management, and the Developer has current, valid certifications of the same. 4. All hotel~motel taxes imposed pursuant to Iowa Code Section 423A.7 collected by operation of the hotel at 328 S. Clinton Street, Iowa City, Iowa, have been paid for the prior quarter, as evidenced by the attached quarterly tax return and receipt of payment for the tax obligation stated therein. 26 EXHIBITE QUARTERLY CERTIFICATIO~ Date: ---------~ (due by January 31, April 30, July 31) I, the undersigned, having knowledge of the Developer's Agreement between the City of Iowa City and Iowa City Hotel Associates, L.L.C., dated , 2015, and the operations of the Development Property, hereby certify the. :follo:wing; · · ·. · ' .. , . '.}; / ·.;_· \I• 1. All hotel-motel taxes imposed pursuant to Iowa Code Section423A.7 collected by operation of the hotel at 328 S. Clinton Street, Iowa City, Iowa, have been paid for the prior quarter, as evidenced by the attached quarterly tax return and receipt bf payment for the tax obligation stated therein; and 2. (A) I have re-examined the terms and provisions of the Development Agreement and can affirm that during the preceding twelve (12) months, the Developeri~ not, or was not, in default in the fulfillment of any of the terms and conditions of said Agreement (including but not limited to the occupancy requirements of Section 3.3 thereto) and that no Event ofDefault(or event which, with the lapse of time or the giving of notice, or both, would become an-Event of Default) is·occurring or has occurred as of the date of this certificate. OR (B) the undersigned has re-examined the terms and provisions of the Development Agreement and that at the date of this certificate, the undersigned is aware that the Developer is in default of the Agreement for the following reasons: _____________________ _ that the default has existed since (date); and that the Developer is taking or proposes to take the following action w.ith respect thereto: _________________ _ 3. The Development Property is being managed in compliance with ISO 5001 standards for energy management, and ISO 14001 and 900 I standards for envir~mmental management and quality management, and the Developer has current, valid certifications·of the same .. 27 EXHIBITF The property locally known as 314 S. Clinton Street, Iowa City, Iowa, is described as consisting of all that certain parcel or parcels of land located in the City oflowa City, County of Johnson, State of Iowa, more particularly described as follows: Lots 7 and 8 in Block 102, in Iowa City, Johnson County, Iowa, according to the recorded plat thereof.