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HomeMy WebLinkAbout2024-08-19 I01E_03 Assignment of Econ Dev Grants_The Quarter at Waukee LLC, Community State BankAGENDA ITEM: CITY OF WAUKEE, IOWA CITY COUNCIL MEETING COMMUNICATION MEETING DATE: August 19, 2024 AGENDA ITEM:Resolution approving and authorizing execution of a City Consent to Assignment of Economic Development Grants by and among the City of Waukee, Iowa, The Quarter at Waukee, L.L.C., and Community State Bank FORMAT:Consent SYNOPSIS INCLUDING PRO & CON: The City has received a request from the Developer and Community State Bank, in the form of a proposed City Consent to Assignment of Economic Development Grants, by and between the Developer and Bank. The agreement states the bank is willing to extend a loan for commercial development in the entertainment district, if the City consent to an Assignment of Economic Development grants. FISCAL IMPACT INCLUDING COST/BENEFIT ANALYSIS: COMMISSION/BOARD/COMMITTEE COMMENT: STAFF REVIEW AND COMMENT: RECOMMENDATION: Approve the Resolution ATTACHMENTS: I. Resolution II. The Quarter at Waukee, L.L.C. – Agreement for Private Development PREPARED BY:Jennifer Brown, Economic Development Director REVIEWED BY: PUBLIC NOTICE INFORMATION – NAME OF PUBLICATION: DATE OF PUBLICATION: I1E3 RESOLUTION NO. ______ RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF A CITY CONSENT TO ASSIGNMENT OF ECONOMIC DEVELOPMENT GRANTS BY AND AMONT THE CITY OF WAUKEE, IOWA, THE QUARTER AT WAUKEE, L.L.C., AND COMMUNITY STATE BANK WHEREAS, on the 19th day of December, 2022, the City of Waukee, Iowa (the "City") and The Quarter at Waukee, L.L.C. ("Developer") entered into an Agreement for Private Development, as amended by a First Amendment dated January 17, 2023, a Second Amendment dated March 6, 2023, a Third Amendment dated July 10, 2023, and a Fourth Amendment dated January 15, 2024 ("Development Agreement") pursuant to which the Developer agreed to construct certain Minimum Improvements (as that term is defined in the Development Agreement) and prepare certain property located in the City’s The Quarter Commercial Urban Renewal Area (the "Development Property") for construction of certain commercial structures that would be occupied by commercial businesses, and the City agreed to provide certain Economic Development Grants to the Developer in exchange for Developer’s obligations under the Development Agreement; and WHEREAS, the City has received a request from the Developer and Community State Bank ("Bank"), in the form of a proposed City Consent to Assignment of Economic Development Grants (the "Consent") by and between the Developer and Bank; and WHEREAS, James L. Mann, individually ("Borrower") has applied to Bank for a certain loan (the "Loan") pursuant to the terms of that certain Loan Agreement by and between Borrower and Bank (the "Loan Agreement"); and WHEREAS, a portion of the proceeds of the Loan will be contributed by Borrower into and for the benefit of that certain entertainment development to be located on the Development Property owned by Developer; and WHEREAS, Bank is willing to extend the Loan to Borrower subject to, among other things, Developer assigning to Bank, Developer’s right, title and interest to certain Economic Development Grants described in the Development Agreement, ("Limited Economic Development Grants"); and WHEREAS, the Bank has requested the City’s consent before the Developer assigns any of its rights and obligations under the Development Agreement, and the City is willing to provide such consent under the terms set forth in the proposed Consent. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WAUKEE, IOWA: Section 1. That the form and content of the Consent, the provisions of which are incorporated herein by reference, be and the same hereby are in all respects authorized, approved and confirmed, and the Mayor and the City Clerk be and they hereby are authorized, empowered and directed to execute, attest, seal and deliver the Consent for and on behalf of the City in substantially the form and content now before this meeting, but with such changes, modifications, additions or deletions therein as shall be approved by such officers, and that from and after the execution and delivery of the Consent, the Mayor and the City Clerk are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents as may be necessary to carry out and comply with the provisions of the Consent as executed. PASSED AND APPROVED this 19th day of August, 2024. ______________________________________ Mayor ATTEST: __________________________________ City Clerk 1 96579794.3 CITY CONSENT TO ASSIGNMENT OF ECONOMIC DEVELOPMENT GRANTS THIS CITY CONSENT TO ASSIGNMENT OF ECONOMIC DEVELOPMENT GRANTS (“Consent”) is made as of the _____ day of July, 2024 by and among The Quarter at Waukee, L.L.C, an Iowa limited liability company (“Developer”), Community State Bank, an Illinois state-chartered bank (“Bank”) and The City Of Waukee, Iowa, a municipality established pursuant to the Iowa Code (the “City”). RECITALS WHEREAS, on December 19, 2022, Developer entered into a certain Agreement for Private Development (the “Agreement”) with the City, as previously amended four times and as may be amended from time to time (a copy of which is attached hereto as Exhibit “A”) for the development of certain real estate located in the City of Waukee, Dallas County, Iowa, as more particularly described in the Agreement (the “Development Property”); and WHEREAS, James L. Mann, individually (“Borrower”) has applied to Bank for a certain loan (the “Loan”) pursuant to the terms of that certain Loan Agreement by and between Borrower and Bank dated of even date herewith (the “Loan Agreement”); and WHEREAS, a portion of the proceeds of the Loan will be contributed by Borrower into and for the benefit of that certain entertainment development to be located on the Development Property owned by Developer; and WHEREAS, Bank is willing to extend the Loan to Borrower subject to, among other things, Developer assigning to Bank, Developer’s right, title and interest to those Economic Development Grants as described in the Agreement derived from the buildings identified in Exhibit “B” attached hereto, and specifically excluding Economic Development Grants derived from any other buildings constructed on the Development Property described in the Agreement (hereinafter referred to as “Limited Economic Development Grants”) pursuant to that that certain Assignment of Economic Development Grants dated on or about even date herewith (the “Assignment”); and NOW, THEREFORE, in consideration of the foregoing recitals, the agreements, promises and covenants herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Consent hereby agree as follows: 1. Consent to Pledge. (a) The City hereby acknowledges and consents to the pledge by Developer to Bank of all of Developer’s right, title and interest in and to the Limited Economic Development Grants and all proceeds and benefits therefrom as set forth in Section 7.1 of the Agreement as partial security for the obligations of Borrower to Lender pursuant to the terms and conditions of the Assignment, the Loan Agreement and all other documents evidencing, securing or otherwise executed in connection with the Loan. The City Community State Bank / J. Mann City Consent to Assignment of Economic Development Grants 2 further acknowledges and agrees that the Assignment is permissible pursuant to Section 6.1 of the Agreement. For the avoidance of doubt, Bank’s rights to the Limited Economic Development Grants under the Assignment shall be no greater than those of the Developer under the terms of the Agreement. (b) The City further acknowledges, and Developer acknowledges, agrees and irrevocably directs, so long as the Agreement remains in effect, or until the City is otherwise notified in writing by Bank, all payments of the Limited Economic Development Grants shall be paid by check made out in the name of the Bank and delivered by the City to the Bank at the address for the Bank set forth in Section 8 below, for further deposit by the Bank into account number xxx-061-0 in the name of Developer at the Bank. To the extent any Limited Economic Development Grants are paid to the Bank pursuant to this Assignment, Developer agrees that the City shall have no further liability to Developer for the same, and Developer releases the City from any claims related to or arising out of the City’s payment of such Limited Economic Development Grants to the Bank as described in this Assignment. 2. RECORDING/UCC. Developer authorizes Bank to file the Assignment with the Dallas County Recorder’s office as well as a UCC-1 Financing Statement with the Iowa Secretary of State giving notice to all third parties of Bank’s collateral interest. 3. DEFAULT. In the event Developer defaults under the Agreement, Bank shall have the right, but not the obligation, to cure or cause the cure of such default on the same terms and under the same conditions as Developer under the Agreement. The City agrees to accept performance of Developer’s obligations under the Agreement from Bank under the terms of the Assignment. 4. NEGATIVE PLEDGE. Developer agrees that it will not voluntarily or involuntarily pledge, encumber or otherwise allow any lien to be placed upon its interests to the Limited Economic Development Grants, except for that granted to Bank hereunder. The City agrees not to further amend the Agreement in a manner that impacts the Limited Economic Development Grants, without the prior written consent of the Bank, which consent shall not be unreasonably withheld, delayed or conditioned. Bank agrees that it will not contest the Minimum Assessment Agreement (as such term is defined in the Agreement). 5. ENFORCEMENT COSTS. If Bank hires an attorney to assist it in enforcing its rights and remedies hereto, Developer agrees to pay the reasonable attorneys’ fees and costs incurred by Bank. 6. INDEMNITY. Bank shall not be obligated to perform or discharge, nor does it hereby undertake to perform or discharge, any obligation, duty or liability under the Agreement or under or by reason of the Assignment; and Developer shall and does hereby agree to indemnify Bank for and to hold Bank harmless of and from any and all liability, loss or damage which it may or might incur under the Agreement or under or by reason of the Assignment, and of and from any and all claims and demands whatsoever which may be asserted against it by reason of any alleged obligations or undertakings on its part to perform or discharge any of the Community State Bank / J. Mann City Consent to Assignment of Economic Development Grants 3 terms, covenants or agreements contained in the Agreement, except for matters caused by Bank’s negligence or willful acts. Should Bank incur any liability, loss or damage under the Agreement or under or by reason of the Assignment, or in the defense of any such claims or demands, the amounts thereof, including costs, expenses and reasonable attorney’s fees, shall be secured hereby; and Developer shall reimburse Bank therefor immediately upon demand, and upon failure of Developer to do so Bank may declare all sums secured hereby immediately due and payable. 7. REPRESENTATIONS. The City represents to and for the benefit of the Bank that: (a) The Agreement is in full force and effect on the date hereof and represents the valid, binding and enforceable obligations of the City. The City is not in default under the Agreement and has not breached any of the terms of the Agreement. (b) The City has received no notice of prior sale, transfer or assignment, hypothecation or pledge of Developer’s interest in the Limited Economic Development Grants, except as otherwise set forth herein. 8. NOTICES. Any notices required or permitted to be given with this Consent shall be in writing and shall be deemed to have been given if and when received if personally delivered, or on the second business day after being deposited in United States registered or certified mail, postage prepaid, and addressed to a party at its address set forth below or to such other address the party to receive such notice may have designated to all other parties by notice in accordance herewith: If to Bank: Community State Bank 625 SE 2nd Street, Galva, Illinois 61434 Attention: Daniel Smith, Vice President With a copy to: Polsinelli 7676 Forsyth Blvd., Suite 800 St. Louis, Missouri 63105 Attention: Mike Wazlawek If to City: City of Waukee, Iowa 230 West Hickman Road Waukee, Iowa 50263 Attention: City Clerk If to Developer: The Quarter at Waukee, L.L.C. 4700 150th Street Urbandale, Iowa 50323 Community State Bank / J. Mann City Consent to Assignment of Economic Development Grants 4 9. COUNTERPARTS. This Consent may be executed in any number of counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same Consent. IMPORTANT: READ BEFORE SIGNING, THE TERMS OF THIS AGREEMENT SHOULD BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT. Developer warrants that it has received a copy of this Consent and further states that it understands fully the terms and conditions described herein. Signature Pages to Follow Community State Bank / J. Mann City Consent to Assignment of Economic Development Grants 6 EXHIBIT A DEVELOPMENT AGREEMENT Community State Bank / J. Mann City Consent to Assignment of Economic Development Grants 7 EXHIBIT B