HomeMy WebLinkAbout2016-08-01-I06 KC Kettlestone Dev Agr_Approve AGENDA ITEM:
CITY OF WAUKEE, IOWA
CITY COUNCIL MEETING COMMUNICATION
MEETING DATE: August 1, 2016
AGENDA ITEM: Consideration of approval of a resolution approving and authorizing
execution of a Development Agreement by and among the City of
Waukee, KC Kettlestone, L.C., and Ashworth Properties Development,
Inc.
FORMAT: Resolution
SYNOPSIS INCLUDING PRO & CON:
FISCAL IMPACT INCLUDING COST/BENEFIT ANALYSIS:
COMMISSION/BOARD/COMMITTEE COMMENT:
STAFF REVIEW AND COMMENT: Legal counsel has reviewed the development agreement
and finds it satisfactory.
RECOMMENDATION: Approve the resolution.
ATTACHMENTS: I. Proposed Resolution
II. Development Agreement
PREPARED BY: Becky Schuett
REVIEWED BY:
PUBLIC NOTICE INFORMATION –
NAME OF PUBLICATION:
DATE OF PUBLICATION:
RESOLUTION NO. ______
RESOLUTION APPROVING AND AUTHORIZING
EXECUTION OF A DEVELOPMENT AGREEMENT BY AND
AMONG THE CITY OF WAUKEE, KC KETTLESTONE, L.C.,
AND ASHWORTH PROPERTIES DEVELOPMENT, INC.
WHEREAS, by Resolution No. 13-257, adopted October 21, 2013, this Council found
and determined that certain areas located within the City are eligible and should be designated as
an urban renewal area under Iowa law, and approved and adopted the Gateway Urban Renewal
Plan (the "Plan") for the Gateway Urban Renewal Area (the "Urban Renewal Area" or "Area")
described therein, which Plan, as amended, is on file in the office of the Recorder of Dallas
County; and
WHEREAS, it is desirable that properties within the Area be redeveloped as part of the
overall redevelopment area covered by said Plan; and
WHEREAS, the City has received a proposal from KC Kettlestone, L.C. (the
“Developer”) and Ashworth Properties Development, Inc. (the "Land Developer"), in the form of
a proposed Development Agreement (the "Agreement") by and among the City, the Developer,
and the Land Developer pursuant to which, among other things, the Developer would agree to
construct certain Minimum Improvements (as defined in the Agreement) on certain real property
located within the Gateway Urban Renewal Area as defined and legally described in the
Agreement and consisting of the construction of a 90,000 square foot, two story building to be
used for office space, together with all related site improvements, as outlined in the proposed
Development Agreement; and
WHEREAS, the Agreement further proposes that the City will make up to five (5)
consecutive annual payments of Economic Development Grants to Developer consisting of
100% of the Tax Increments pursuant to Iowa Code Section 403.19 and generated by the
construction of the Minimum Improvements; the cumulative total for all such payments is
currently estimated to be $1,740,000 but in no event will exceed the amount accrued under the
formula outlined in the proposed Development Agreement, under the terms and following
satisfaction of the conditions set forth in the Agreement; and
WHEREAS, the Agreement proposes that Land Developer will dedicate property to the
City, at no cost to the City, to be used as right-of-way for certain Public Improvements, as
described in the Agreement, to be constructed by the City in the Urban Renewal Area; and
WHEREAS, the Agreement further proposes that Land Developer will pay for the costs
of the Public Improvements not otherwise paid for by RISE grants; and
WHEREAS, the Agreement further proposes that the City will make up to five (5)
additional consecutive annual payments of Economic Development Grants to Developer
consisting of 100% of the Tax Increments pursuant to Iowa Code Section 403.19 and generated
by the construction of the Minimum Improvements, the cumulative total for all such payments
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not to exceed the amount accrued under the formula outlined in the proposed Development
Agreement (currently estimated to be $1,740,000), under the terms and following satisfaction of
the conditions set forth in the Agreement; and
WHEREAS, the Agreement further proposes that Developer will contribute $25,000 from
each Economic Development Grant to offset the cost of the City constructing certain Public
Amenities in the Urban Renewal Area, as described in the Agreement; and
WHEREAS, Developer anticipates the Minimum Improvements will be leased to a
commercial business that will employ employees therein; and
WHEREAS, Iowa Code Chapters 15A and 403 authorize cities to make loans and grants
for economic development in furtherance of the objectives of an urban renewal project and to
appropriate such funds and make such expenditures as may be necessary to carry out the
purposes of said Chapters, and to levy taxes and assessments for such purposes; and
WHEREAS, the Council has determined that the Agreement is in the best interests of the
City and the residents thereof and that the performance by the City of its obligations thereunder
is a public undertaking and purpose and in furtherance of the Plan and the Urban Renewal Law
and, further, that the Agreement and the City's performance thereunder is in furtherance of
appropriate economic development activities and objectives of the City within the meaning of
Chapters 15A and 403 of the Iowa Code taking into account any or all of the factors set forth in
Chapter 15A, to wit:
a. Businesses that add diversity to or generate new opportunities for the Iowa
economy should be favored over those that do not.
b. Development policies in the dispensing of the funds should attract, retain, or
expand businesses that produce exports or import substitutes or which generate
tourism-related activities.
c. Development policies in the dispensing or use of the funds should be targeted
toward businesses that generate public gains and benefits, which gains and
benefits are warranted in comparison to the amount of the funds dispensed.
d. Development policies in dispensing the funds should not be used to attract a
business presently located within the state to relocate to another portion of the
state unless the business is considering in good faith to relocate outside the state
or unless the relocation is related to an expansion which will generate significant
new job creation. Jobs created as a result of other jobs in similar Iowa businesses
being displaced shall not be considered direct jobs for the purpose of dispensing
funds; and
WHEREAS, pursuant to notice published as required by law, this Council has held a
public meeting and hearing upon the proposal to approve and authorize execution of the
Agreement and has considered the extent of objections received from residents or property
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owners as to said proposed Agreement; and, accordingly the following action is now considered
to be in the best interests of the City and residents thereof.
NOW THEREFORE, BE IT RESOLVED, BY THE CITY COUNCIL OF THE CITY
OF WAUKEE IN THE STATE OF IOWA:
Section 1. That the performance by the City of its obligations under the Agreement,
including but not limited to making of grants to the Developer in connection with the
development of the Development Property under the terms set forth in the Agreement, be and is
hereby declared to be a public undertaking and purpose and in furtherance of the Plan and the
Urban Renewal Law and, further, that the Agreement and the City's performance thereunder is in
furtherance of appropriate economic development activities and objectives of the City within the
meaning of Chapters 15A and 403 of the Iowa Code, taking into account the factors set forth
therein.
Section 2. That the form and content of the Agreement, 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 Agreement 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 Agreement, 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 Agreement as
executed.
PASSED AND APPROVED this 1st day of August, 2016.
Mayor
ATTEST:
City Clerk
Execution Version
AGREEMENT FOR PRIVATE DEVELOPMENT
By and Among
CITY OF WAUKEE, IOWA
AND
KC KETTLESTONE, L.C.
AND
ASHWORTH PROPERTIES DEVELOPMENT, INC.
___________ _____, 2016
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AGREEMENT
FOR
PRIVATE DEVELOPMENT
THIS AGREEMENT FOR PRIVATE DEVELOPMENT ("Agreement"), is made on or as
of the ____ day of ___________, 2016, by and among the CITY OF WAUKEE, IOWA, a
municipality (the "City"), established pursuant to the Code of Iowa and acting under the
authorization of Chapters 15A and 403 of the Code of Iowa, 2015, as amended ("Urban Renewal
Act"), KC Kettlestone, L.C., an Iowa limited liability company having offices for the transaction
of business at 5000 Westown Parkway, Suite 400, West Des Moines, IA 50266 (“Developer”)
and Ashworth Properties Development, Inc., an Iowa corporation having offices for the transaction
of business at 5000 Westown Parkway, Suite 400, West Des Moines, IA 50266 (“Land
Developer”). The City, Developer and Land Developer are the parties to this Agreement.
WITNESSETH:
WHEREAS, in furtherance of the objectives of the Urban Renewal Act, the City has
undertaken a program for the development of an economic development area in the City and, in
this connection, is engaged in carrying out urban renewal project activities in an area known as the
Gateway Urban Renewal Area (the “Urban Renewal Area”), which is described in the Urban
Renewal Plan originally approved for such area by Resolution No. 13-257, adopted October 21,
2013, and subsequently amended; 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 Dallas County, Iowa; and
WHEREAS, Land Developer is the fee simple owner of certain real property located in the
foregoing Urban Renewal Area as more particularly described in Exhibit A attached hereto and
made a part hereof (“Land Developer Property”); and
WHEREAS, Developer shall be either the leaseholder under a ground lease with Land
Developer or the fee simple owner of property located in the foregoing Urban Renewal Area and
as more particularly described in Exhibit A attached hereto and made a part hereof (which property
as so described is hereinafter referred to as the "Development Property”); and
WHEREAS, Developer shall build Minimum Improvements on the Development Property;
and
WHEREAS, Developer shall enter into a lease for the Minimum Improvements with a
tenant and said tenant may operate its business at the Minimum Improvements and hire and retain
employees at the Minimum Improvements; and
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WHEREAS, the City shall build Public Improvements which benefit, among other things,
the Development Property, and the Land Developer shall help fund the construction of said Public
Improvements; and
WHEREAS, the City believes that the development of the Development Property pursuant
to this Agreement and the fulfillment of this Agreement are in the vital and best interests of the
City and in accord with 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 promises 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.
Area or Urban Renewal Area shall mean the area known as the Gateway Urban Renewal
Area.
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.
City means the City of Waukee, Iowa, or any successor to its functions.
Code means the Code of Iowa, 2015, as amended.
Commencement Date means the date of this Agreement.
Construction Plans means the plans, specifications, drawings and related documents
reflecting the construction work to be performed by the Developer on the Development Property;
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.
Developer means KC Kettlestone, L.C., an Iowa limited liability company, and each
assignee that assumes in writing all of the obligations of the Developer under this Agreement with
the written consent of the City as provided in Section 8.1 of this Agreement.
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Development Property means that portion of the Gateway Urban Renewal Area described
in Exhibit A.
Economic Development Grants means the payments to be made by the City to Developer
under Article IX of this Agreement.
Event of Default means any of the events described in Section 12.1 of this Agreement that
have continued beyond applicable notice and cure periods.
Gateway Urban Renewal Tax Increment Revenue 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 will
be 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 Chapters 15A, 403 or 384 of the Code, incurred by the
City to finance or refinance in whole or in part projects undertaken pursuant to the Urban Renewal
Plan for the Urban Renewal Area.
Indemnified Parties means the City and the governing body members, officers, agents,
servants and employees thereof.
KC Kettlestone TIF Account means a separate account within the Gateway Urban Renewal
Tax Increment Revenue Fund of the City in which Tax Increments received by the City with
respect to the Minimum Improvements and the Development Property shall be deposited.
Land Developer means Ashworth Properties Development, Inc., an Iowa corporation, and
each assignee that assumes in writing all of the obligations of the Land Developer under this
Agreement with the written consent of the City as provided in Section 8.1 of this Agreement.
Land Developer Property means that portion of the Gateway Urban Renewal Area as
described in Exhibit A.
Minimum Improvements means the construction of an approximately 90,000 square foot
building and related improvements, as more particularly described in Exhibit B to this Agreement.
Mortgage means any mortgage or security agreement in which Developer has granted a
mortgage or other security interest in the Development Property, or any portion or parcel thereof,
or any improvements constructed thereon.
Ordinance means an Ordinance of the City, under which the taxes levied on taxable
property in the Urban Renewal Area shall be divided and a portion paid into the Gateway Urban
Renewal Tax Increment Revenue Fund.
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Project shall mean the construction of the Minimum Improvements on the Development
Property as described in this Agreement.
Public Amenities shall mean the amenities detailed in Exhibits J and J -1 attached to this
Agreement to be constructed on the Land Developer Property.
Public Amenities Costs means any and all engineering, planning, design, financing,
permitting, legal and other costs and expenses incurred by the City to design and plan the Public
Amenities plus the cost of all materials and labor and associated expenses related to the
construction of the Public Amenities, including but not limited to those improvement costs defined
under Iowa Code Section 384.24(5) and/or Iowa Code Section 384.37(19), (23), and (26), and any
other costs associated with completing the Public Amenities.
Public Improvements shall mean the infrastructure improvements to be completed by the
City as detailed in Exhibits I and I-1 attached to this Agreement.
Public Improvement Costs means any and all engineering, planning, design, financing,
permitting, legal and other costs and expenses incurred by the City to design and plan the Public
Improvements plus the cost of all materials and labor and associated expenses related to the
construction of the Public Improvements, including but not limited to those improvement costs
defined under Iowa Code Section 384.24(5) and/or Iowa Code Section 384.37(19), (23), and
(26), and any other costs associated with completing the Public Improvements.
Qualified Tenant means an entity which: (1) enters into a lease with Developer to rent a
portion of the Minimum Improvements; (2) will employ employees in the Minimum
Improvements; (3) is not relocating as defined Iowa Code section 403.19(9) or is authorized to
relocate thereunder; and (4) qualifies for incentives from the State of Iowa requiring a local match.
RISE Contract means the contract between the City and the Iowa Department of
Transportation, Contract No. 2017-R-002, providing a grant towards the Public Improvement
Costs.
Tax Increments means the property tax revenues on the Minimum Improvements and
Development Property divided and made available to the City for deposit in the KC Kettlestone
TIF Account of the Gateway Urban Renewal Tax Increment Revenue Fund under the provisions
of Section 403.19 of the Code, as amended, and the Ordinance.
Termination Date means the date of termination of this Agreement, as established in
Section 13.8 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
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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,
with respect to a City-claimed delay).
Urban Renewal Plan means the Urban Renewal Plan, as amended, approved with respect
to the Gateway Urban Renewal Area, described in the preambles hereof.
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 municipality 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.
c. 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.
d. On or before the date the Developer receives an occupancy permit for the Minimum
Improvements, the City shall complete the construction of the portion of Esker Ridge Drive that
is necessary to access the Development Property from Grand Prairie Parkway (the first 650 feet
running east from the intersection with Grand Prairie Parkway as depicted in Exhibit I-1).
Section 2.2. Representations and Warranties of Developer. Developer makes the
following representations and warranties:
a. KC Kettlestone, L.C. is an Iowa limited liability company, duly organized and
validly existing under the laws of the State of Iowa, and it has all requisite power and authority to
own and operate its properties, to carry on its business as now conducted and as presently proposed
to be conducted, and to enter into and perform its obligations under the Agreement.
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b. This Agreement has been duly and validly authorized, executed and delivered by
Developer and, assuming due authorization, execution and delivery by the City and the Land
Developer, is in full force and effect and is a valid and legally binding instrument of 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. The
Developer's attorney shall provide an enforceability opinion in the form of Exhibit H to be signed
concurrently with this Agreement.
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 governing documents of
Developer or of any contractual restriction, evidence of indebtedness, agreement or instrument of
whatever nature to which 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
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 Developer or which
in any manner raises any questions affecting the validity of the Agreement or Developer's ability
to perform its obligations under this Agreement.
e. Developer has not received any notice from any local, State or 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 shall cooperate with the City in resolution of any traffic, parking, trash
removal or public safety problems which may arise in connection with the construction and
operation of the Minimum Improvements, Public Amenities, and Public Improvements.
g. Developer shall cause the Minimum Improvements to be constructed in accordance
with the terms of this Agreement, the Urban Renewal Plan, and all local, State, and federal laws
and regulations.
h. Developer shall obtain or cause to be obtained, in a timely manner, all required
permits, licenses, and approvals, and shall meet, in a timely manner, all requirements of all
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applicable local, State, and federal laws and regulations which must be obtained or met before the
Minimum Improvements may be lawfully constructed.
i. It is anticipated that the construction of the Minimum Improvements will require a
total investment of not less than $27,263,500.
j. Developer has firm commitments for construction or acquisition and permanent
financing for the Project in an amount sufficient, together with equity commitments, to
successfully complete the Minimum Improvements in accordance with the Construction Plans
contemplated in this Agreement.
k. Developer expects that, barring Unavoidable Delays, the Minimum Improvements
will be completed by December 31, 2018.
l. The Developer shall deed to the City all rights-of-way in the Development Property
necessary for the City to construct the Public Improvements, and provide such easements as are
necessary for the City to construct and/or maintain the Public Improvements and Public Amenities,
all at no cost to the City.
m. Developer would not undertake its obligations under this Agreement without the
payment by the City of the Economic Development Grants being made to Developer pursuant to
this Agreement.
n. Developer shall enter into a lease with a tenant for the Minimum Improvements,
provided, however, that Developer does not and cannot represent and warrant that tenant will
perform under that lease, and that failure to perform pursuant to the terms of any l ease by any
tenant of the Minimum Improvements shall not be considered a violation of any term or condition
of this Development Agreement.
Section 2.3. Representations and Warranties of Land Developer. Land Developer makes
the following representations and warranties:
a. Ashworth Properties Development, Inc. is an Iowa corporation, duly organized and
validly existing under the laws of the State of Iowa, and it has all requisite power and authority to
own and operate its properties, to carry on its business as now conducted and as presently proposed
to be conducted, and to enter into and perform its obligations under the Agreement.
b. This Agreement has been duly and validly authorized, executed and delivered by
Land Developer and, assuming due authorization, execution and delivery by the City and the
Developer, is in full force and effect and is a valid and legally binding instrument of Land
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.
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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 governing documents of Land
Developer or of any contractual restriction, evidence of indebtedness, agreement or instrument of
whatever nature to which Land 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
Land 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 Land
Developer or which in any manner raises any questions affecting the validity of the Agreement or
Land Developer's ability to perform its obligations under this Agreement.
e. Land Developer has not received any notice from any local, State or federal official
that the activities of Land Developer with respect to the Land Developer 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). Land 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 Land Developer
Property, and Land 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. The Land Developer shall deed to the City all rights-of-way in the Land Developer
Property necessary for the City to construct the Public Improvements, and provide such easements
as are necessary for the City to construct and/or maintain the Public Improvements and Public
Amenities, all at no cost to the City.
g. Land Developer would not undertake its obligations under this Agreement without
the payment by the City of the Economic Development Grants being made to Developer pursuant
to this Agreement.
h. Land Developer’s representation, warranties and obligations under this
Development Agreement are limited to: (i) the dedication of the right of way in the Land Developer
Property necessary for the City to construct the Public Improvements, (ii) providing easements as
necessary for the City to construct and maintain the Public Improvements and Public Amenities,
(iii) reimbursing the City for any Public Improvement Costs pursuant to the terms of Section 4 .2
herein, and (iv) allowing the Economic Development Grants to be paid pursuant to the terms
contained in Section 9.1.b herein. The parties acknowledge and agree that Land Developer shall
have no other rights or obligations hereunder.
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ARTICLE III. CONSTRUCTION OF MINIMUM IMPROVEMENTS
Section 3.1. Construction of Minimum Improvements. Developer agrees that it will cause
the Minimum Improvements to be constructed on the Development Property in conformance with
the Construction Plans submitted to the City in accordance with Section 3.2 below. Developer
agrees that the scope and scale of the Minimum Improvements to be constructed shall not be
significantly less than the scope and scale of the Minimum Improvements as detailed and outlined
in the Construction Plans, the construction of which is anticipated to require a total investment of
not less than $27,263,500 in construction costs.
Section 3.2. Construction Plans. Developer shall cause Construction Plans to be developed
for the Minimum Improvements, which shall be subject to approval by the City as provided in this
Section 3.2, and which approval shall not be unreasonably withheld, conditioned or delayed. The
Construction Plans shall be in conformity with the Urban Renewal Plan, this Agreement, and all
applicable State and local laws and regulations. The City shall approve the Construction Pl ans in
writing if: (i) the Construction Plans conform to the terms and conditions of this Agreement; (ii)
the Construction Plans conform to the terms and conditions of the Urban Renewal Plan; (iii) the
Construction Plans conform to all applicable federal, State and local laws, ordinances, rules and
regulations, and City permit requirements; (iv) the Construction Plans are adequate for purposes
of this Agreement to provide for the construction of the Minimum Improvements; and (v) no Event
of Default under the terms of this Agreement has occurred and is continuing beyond applicable
notice and cure periods; provided, however, that any such approval of the Construction Plans
pursuant to this Section 3.2 shall constitute approval for the purposes of this Agreement only and
shall not be deemed to constitute approval or waiver by the City with respect to any building, fire,
zoning or other ordinances or regulations of the City, and shall not be deemed to be sufficient plans
to serve as the basis for the issuance of a building permit if the Construction Plans are not as
detailed or complete as the plans otherwise required for the issuance of a building permit. The site
plans submitted to the building official of the City for the Development Property and the
surrounding areas where the Minimum Improvements are to be constructed shall be adequate to
serve as the Construction Plans, if such site plans are approved by the building official.
Approval of the Construction Plans by the City shall not relieve any obligation to comply
with the terms and provisions of this Agreement, or the provision of applicable federal, State and
local laws, ordinances and regulations.
Approval of Construction Plans hereunder is solely for purposes of this Agreement, and
shall not constitute approval for any other City purpose nor subject the City to any liability for the
Minimum Improvements as constructed.
Section 3.3. Commencement and Completion of Construction. Subject to Unavoidable
Delays, Developer shall cause construction of the Minimum Improvements to be undertaken and
completed: (i) by no later than December 31, 2018; or (ii) by such other date as the parties shall
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mutually agree upon in writing. Time lost as a result of Unavoidable Delays shall be added to
extend this date by a number of days equal to the number of days lost as a result of Unavoidable
Delays. All work with respect to the Minimum Improvements shall be in conformity with the
Construction Plans approved by the building official or any amendments thereto as may be
approved by the building official.
Developer and Land Developer agree that they shall permit designated representatives of
the City, upon reasonable notice (which does not have to be written), to enter upon the
Development Property during the construction of the Minimum Improvements to inspect such
construction and the progress thereof, subject to Developer’s rules and regulations for the
construction site.
Section 3.4. Certificate of Completion. Within fifteen (15) business days after written
request by Developer and after issuance of an occupancy permit for the Minimum Improvements,
the City will furnish Developer with a Certificate of Completion in recordable form, 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 with respect to the obligations of Developer to cause construction of the Minimum
Improvements.
The Certificate of Completion may be recorded in the Dallas County Recorder’s Office at
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 3.4, the City shall, within such fifteen (15) business
day period, instead provide a written statement indicating in what respects 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 it will be
necessary, in the opinion of the City, for Developer to take or perform in order to obtain such
Certificate of Completion.
ARTICLE IV. CONSTRUCTION OF PUBLIC IMPROVEMENTS AND PUBLIC
AMENITIES
Section 4.1. Construction of Public Improvements and Public Amenities. Conditioned on
Developer and Land Developer performing their obligations under this Agreement, the City will
use its best efforts to obtain, or cause to be obtained, in a timely manner, public approval as
required by the laws of the State, and all required permits, licenses and approvals necessary to
construct the Public Improvements and Public Amenities.
(a) The City expects that, barring Unavoidable Delays, the construction of the Public
Improvements will be completed by December 1, 2017. If the completion of the Public
Improvements is delayed by Unavoidable Delays, then the anticipated completion date
will be automatically postponed by the duration of the Unavoidable Delay. That
portion of Esker Ridge Drive that is necessary to access the Development Property
from Grand Prairie Parkway (the first 650 feet running east from Grand Prairie Parkway
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as depicted in Exhibit I-1) shall be substantially complete and open to traffic by the
date the Developer receives an occupancy permit for the Minimum Improvements. At
the present time, the expected Public Improvement Costs is $3,025,400.
Section 4.2. Public Improvement Costs/Letter of Credit. Land Developer agrees to
reimburse the City for any Public Improvement Costs paid by the City and for which the City is
not reimbursed by the RISE Contract and which is not required to be paid by any other adjacent
owner. Land Developer agrees to make such reimbursement payments within sixty (60) days of
the City requesting such reimbursement in writing. Any such reimbursement request shall be
unequivocally deemed to have been made as of the date the City mails the request by certified
mail, or hand delivers the request, consistent with Section 13.2. Prior to the execution of this
Agreement, Land Developer shall either: (i) provide and deliver to the City an irrevocable direct
pay letter of credit in the name of the City, in form and substance satisfactory to the City ("Letter
of Credit”), in the amount of $1,737,977 (projected Public Improvement Costs minus anticipated
RISE Contract amount), which has been issued to cover the cost of repayment of the Public
Improvement Costs, or (ii) deposit cash not in excess of the Public Improvement Costs into an
interest bearing account (“Account”) as requested by the City and to be accessed and used by the
City to pay the Public Improvement Costs. If Land Developer provides a Letter of Credit, such
Letter of Credit shall be issued by a bank acceptable to the City and provide immediate recourse
for the City if there is a default in timely repayment of the Public Improvement Costs by Land
Developer under this Agreement. The Letter of Credit shall be released when the City certifies in
writing that all Public Improvement Costs have been reimbursed. Should the Land Developer
deposit cash into the Account as requested by the City, then: (i) Land Developer shall not withdraw
funds from the Account until it receives written certification from the City that all Public
Improvements have been completed and funded; and (ii) all funds remaining in the Account once
the City certifies in writing that the Public Improvements have been completed and funded shall
be returned to the Land Developer.
Section 4.3. Public Amenities Costs/Deduction from Economic Development Grants.
Notwithstanding anything to the contrary in this Agreement, Developer and Land Developer
hereby recognize and agree that the City shall deduct Twenty Five Thousand Dollars ($25,000)
from each Economic Development Grant paid to Developer under Article IX (a maximum
aggregate deduction totaling $250,000). These deductions are conditioned on the City
constructing the Public Amenities as set forth in this Article and are intended to offset the City’s
costs in constructing the Public Amenities.
Section 4.4. No Special Legal Entitlements.
(a) Developer and Land Developer recognize and agree that the Public Improvements
and Public Amenities shall be owned and maintained by the City and that nothing in this
Agreement grants Developer or Land Developer any special legal entitlements or other rights not
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held by members of the general public with respect to ownership, maintenance or use of the Public
Improvements and Public Amenities.
(b) The Parties agree that the City and other Indemnified Parties are not responsible for
and will have no liability to Developer or Land Developer associated with the specifications,
design, plans, quality of construction, or sufficiency of the Public Improvements or Public
Amenities for any particular purpose.
ARTICLE V. STATE AGREEMENTS
Section 5.1. Grant from the Iowa Economic Development Authority. Should any
Qualified Tenant of the Minimum Improvements receive a grant from the Iowa Economic
Development Authority through the High Quality Jobs Program, the incentives provided under
this Agreement are intended to constitute the local community match that will be described in the
High Quality Jobs Program Agreement between such Qualified Tenant, the City, and the Iowa
Economic Development Authority (“HQJP Agreement”). The HQJP Agreement, after being
executed by the Qualified Tenant, the City and the State, will be attached as Exhibit G to this
Agreement through an amendment to be executed by the Developer, Land Developer, and the City.
Any lease between a Qualified Tenant receiving funds under a HQJP Agreement and the Developer
shall contain a provision requiring Developer to remit to that Qualified Tenant a portion of any
Economic Development Grants received from the City under this Agreement as necessary to
satisfy the City’s local match described in the HQJP Agreement. The failure of the Developer to
remit the amount of the local match to any Qualified Tenant under the terms of that tenant’s lease
as described herein shall be an Event of Default hereunder. Nothing in this provision shall require
the City to enter into a High Quality Jobs Program Agreement with any tenant, as the City retains
complete discretion as to whether to enter into any such agreement or provide any such local
match.
Section 5.2. Repayment. Should the City fail to perform under a HQJP Agreement due to
an Event of Default by the Developer or Land Developer under this Agreement or another separate
agreement entered into between the parties, then the Developer or Land Developer (whichever
party caused the Event of Default) shall indemnify and hold the City harmless from any loss,
including repayment of any grant monies, arising out of or related to the City’s failure to fulfill the
terms of the HQJP Agreement.
ARTICLE VI. RESERVED.
ARTICLE VII. FURTHER COVENANTS OF DEVELOPER
Section 7.1. Maintenance of Records. 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 Developer relating to this Project, and
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Developer will provide reasonable protection against loss or damage to such books of record and
account.
Section 7.2. Compliance with Laws. Developer will comply with all state, federal and
local laws, rules and regulations relating to the Minimum Improvements and Development
Property.
Section 7.3. Non-Discrimination. In the construction and operation of the Minimum
Improvements, Developer shall not discriminate against any applicant, employee or tenant because
of age, color, creed, national origin, race, religion, marital status, sex, physical disability, or
familial status. Developer shall ensure that applicants, employees, and tenants are considered and
are treated without regard to their age, color, creed, national origin, race, religion, marital status,
sex, physical disability, or familial status.
Section 7.4. Available Information. Upon request, Developer shall promptly provide the
City with copies of information reasonably requested by City that are related to this Agreement so
that City can determine compliance with the Agreement.
Section 7.5. Employment. Developer is constructing the Minimum Improvements with
the anticipation that the Minimum Improvements will be occupied by a non-retail commercial
enterprise(s) that will be employing individuals therein at least until the Termination Date of this
Agreement.
Section 7.6. Certification. Developer shall certify to the City the date of the first full
assessment of the Minimum Improvements by October 1 of the year in which the Minimum
Improvements are fully assessed.
ARTICLE VIII. PROHIBITION AGAINST ASSIGNMENT AND TRANSFER
Section 8.1. Assignment of Obligations. As security for the obligations of Developer and
Land Developer under this Agreement, Developer and Land Developer represent and agree that,
prior to the full assessment of the Minimum Improvements on January 1, 2019 and the completion
and funding of the Public Improvements, Developer and Land Developer will not transfer, convey,
or assign their obligations under this Agreement to any other party unless: (i) the transferee
partnership, corporation, limited liability company or individual assumes in writing all of the then-
outstanding obligations of Developer or Land Developer (as the case may be) under this
Agreement; and (ii) the City consents thereto in writing in advance thereof, which consent shall
not be unreasonably withheld. After the full assessment of the Minimum Improvements on
January 1, 2019 and the completion and funding of the Public Improvements, Developer and Land
Developer shall be able to transfer, convey or assign their obligations under this Agreement to any
party without any conditions and without seeking the consent of the City.
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Section 8.2. Prohibition Against Use as Non-Taxable or Centrally Assessed Property.
During the term of this Agreement, Developer and Land Developer, or their successors or assigns,
agree that the Minimum Improvements and Development Property cannot be transferred or sold
to a non-profit entity or used for a purpose that would exempt the Development Property or
Minimum Improvements from property tax liability. Nor can the Development Property or
Minimum Improvements be used as centrally assessed property (including but not limited to, Iowa
Code § 428.24 to 428.29 (Public Utility Plants and Related Personal Property); Chapter 433
(Telegraph and Telephone Company Property); Chapter 434 (Railway Property); Chapter 437
(Electric Transmission Lines); Chapter 437A (Property Used in the Production, Generation,
Transmission or Delivery of Electricity or Natural Gas); and Chapter 438 (Pipeline Property)).
ARTICLE IX. ECONOMIC DEVELOPMENT GRANTS
Section 9.1. Economic Development Grants.
a. Minimum Improvements
i. Amount of Grants. For and in consideration of the obligations being
assumed by Developer and Land Developer hereunder, and in furtherance of the goals and
objectives of the Urban Renewal Plan for the Urban Renewal Area and the Urban Renewal Act,
the City agrees, subject to Developer and Land Developer being and remaining in compliance with
the terms of this Agreement, to make up to five (5) consecutive annual payments of Economic
Development Grants to Developer, with the anticipated aggregate total amount currently estimated
to be One Million Seven Hundred Forty Thousand Dollars ($1,740,000), under the following terms
and conditions.
ii. Schedule of Grants. Assuming completion of the Minimum Improvements
by December 31, 2018, full assessment of the Minimum Improvements on January 1, 2019, and
debt certification to the Auditor by the City prior to December 1, 2019, the Economic Development
Grants shall commence on June 1, 2021, and end on June 1, 2025, pursuant to Section 403.19 of
the Urban Renewal Act under the following formula:
June 1, 2021 100% of Tax Increments for Fiscal Year 20-21
June 1, 2022 100% of Tax Increments for Fiscal Year 21-22
June 1, 2023 100% of Tax Increments for Fiscal Year 22-23
June 1, 2024 100% of Tax Increments for Fiscal Year 23-24
June 1, 2025 100% of Tax Increments for Fiscal Year 24-25
The above schedule of the payments for Economic Development Grants is based on the
first full assessment of the Minimum Improvements being January 1, 2019. If the completion of
the Minimum Improvements is delayed so that the Minimum Improvements are not fully assessed
as of January 1, 2019, then the first Economic Development Grant will not begin as scheduled, but
will be delayed one year. However, in no event shall the schedule of Economic Development
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Grants be delayed more than one year, meaning that the latest potential date for Developer’s first
Economic Development Grant, if eligible, is June 1, 2022.
iii. Maximum Amount of Grants. The aggregate amount of the Economic
Development Grants that may be paid to the Developer under Section 9.1(a) of this Agreement
shall be equal to the sum of the total amount of the applicable percentages of Tax Increments
collected in respect of the assessments imposed on the Minimum Improvements and Development
Property (building and land) over the specified five year period, which aggregate amount is
currently estimated to be One Million Seven Hundred Forty Thousand Dollars ($1,740,000). In
no event shall Developer be entitled to receive more than calculated under the formula set forth in
this Section 9.1(a), even if the estimated sum of $1,740,000 is not met. Such Economic
Development Grants shall be personal to Developer and shall be assignable in Developer’s sole
discretion.
b. Public Improvements
i. Amount of Grants. For and in consideration of the obligations being
assumed by Land Developer hereunder, in consideration of the sale or lease transaction between
Developer and Land Developer, and in furtherance of the goals and objectives of the Urban
Renewal Plan for the Urban Renewal Area and the Urban Renewal Act, the City agrees, subject to
Developer and Land Developer being and remaining in compliance with the terms of this
Agreement, to make up to five (5) consecutive annual payments of Economic Development Grants
to the Developer, with the anticipated aggregate total amount currently estimated to be One Million
Seven Hundred Forty Thousand Dollars ($1,740,000), under the following terms and conditions.
ii. Schedule of Grants. The Economic Development Grants shall commence
on June 1, 2026, and end on June 1, 2030, pursuant to Section 403.19 of the Urban Renewal Act
under the following formula:
June 1, 2026 100% of Tax Increments for Fiscal Year 25-26
June 1, 2027 100% of Tax Increments for Fiscal Year 26-27
June 1, 2028 100% of Tax Increments for Fiscal Year 27-28
June 1, 2029 100% of Tax Increments for Fiscal Year 28-29
June 1, 2030 100% of Tax Increments for Fiscal Year 29-30
The above schedule of the payments for Economic Development Grants is based on the
first Grant being paid to Developer under Section 9.1(a) on June 1, 2021. If the first Grant
thereunder is not paid until 2022, the above schedule shall be delayed by one year. However, in
no event shall the schedule of Economic Development Grants be delayed more than one year,
meaning that the latest potential date for Developer’s first Economic Development Grant under
this Section 9.1(b), if eligible, is June 1, 2027.
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iii. Maximum Amount of Grants. The aggregate amount of the Economic
Development Grants that may be paid to the Developer under this Section 9.1(b) of the Agreement
shall be equal to the sum of the total amount of the applicable percentages of Tax Increments
collected with respect to the assessments imposed on the Development Property and Minimum
Improvements (building and land) over the specified five year period, which aggregate amount is
currently estimated to be One Million Seven Hundred Forty Thousand Dollars ($1,740,000). It is
further agreed and understood that in no event shall Developer be entitled to receive more than
calculated under the formula set forth in this Section 9.1(b), even if the aggregate amount is less
than the amount of Public Improvement Costs paid by the Land Developer or the estimated sum
of $1,740,000 is not met. Such Economic Development Grants shall be personal to Developer and
shall be assignable in Developer’s sole discretion.
iv. Limitations. The Developer acknowledges that each Economic
Development Grant payment to be paid to Developer according to this Section 9.1(b) is wholly
contingent upon reimbursement of actual Public Improvement Costs paid by Land Developer, and
payment shall come solely and only from incremental taxes received by the City under Iowa Code
Section 403.19 from levies upon the Development Property and Minimum Improvements. The
City makes no assurance that the Developer will receive Economic Development Grants which
cover the cost of the Public Improvements paid by Land Developer.
c. Calculation of Grants. Each annual payment shall be equal in amount to the
incremental property tax revenues attributable to the Minimum Improvements and the
Development Property that are received by the City from the Dallas County Treasurer and that are
equal to the above percentages of the Tax Increments collected by the City with respect to the
Minimum Improvements on the Development Property (building and land) under the terms of the
Ordinance and deposited into the KC Kettlestone TIF Account (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 Developer) during the preceding twelve-month period in respect of the
Development Property and the Minimum Improvements, but subject to limitation and adjustment
as provided in this Article (such payments being referred to collectively as the "Economic
Development Grants").
d. Limitation to Minimum Improvements. The Economic Development Grants are
only for the Minimum Improvements described in this Agreement and not any expansions or
improvements not included within the definition of the Minimum Improvements which, to be
eligible for Economic Development Grants, would be the subject of an amendment or new
agreement, at the sole discretion of the City Council.
Section 9.2. Conditions Precedent. Notwithstanding the provisions of Section 9.1 above,
the obligation of the City to make an Economic Development Grant in any year shall be subject to
and conditioned upon the following:
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(a) compliance with the terms of this Agreement by Developer and Land
Developer;
(b) the construction of the Minimum Improvements consistent with this Agreement;
and
(c) Land Developer’s payment of the Public Improvement Costs pursuant to
Section 4.2.
Under no circumstances shall the failure by Developer to qualify for an Economic
Development Grant in any year serve to extend the term of this Agreement beyond the Termination
Date or the years during which Economic Development Grants may be awarded to Developer or
the total amount thereof, it being the intent of parties hereto to provide Developer with an
opportunity to receive Economic Development Grants only if Developer and Land Developer fully
comply with the provisions hereof and the Developer becomes entitled thereto, up to the maximum
aggregate amounts set forth in Sections 9.1(a)(iii) and 9.1(b)(iii).
After the Minimum Improvements are first fully assessed and if in compliance with this
Agreement, the City shall certify to the County prior to 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 County and paid to the City as taxes are paid during the following
fiscal year and which shall thereafter be disbursed to Developer on the following June 1.
(Example: assuming completion by December 2018 and first full assessment on January 1, 2019,
if Developer certifies in October 2019 and the City certifies to the County by December 1, 2019,
the first Economic Development Grant would be paid to Developer on June 1, 2021 (for 100% of
the Tax Increment for fiscal year 2020-2021)). Compliance with the terms and conditions of this
Agreement is a condition precedent to receiving an Economic Development Grant.
Section 9.3. Source of Grant Funds Limited.
a. The Economic Development Grants shall be payable from and secured solely and
only by amounts of incremental property tax revenues attributable to the Minimum Improvements
and the Development Property that are received by the City from the Dallas County Treasurer and
that are deposited and held in the KC Kettlestone TIF Account of the Gateway Urban Renewal
Tax Increment Revenue Fund of the City. The City hereby covenants and agrees to maintain the
Ordinance in force during the term hereof and to apply the appropriate percentage of Tax
Increments collected in respect of the Development Property and Minimum Improvements and
allocated to the KC Kettlestone TIF Account to pay the Economic Development Grants, as and to
the extent set forth in this Article. The Economic Development Grants shall not be payable in any
manner by other tax increment revenues or by general taxation or from any other City funds. Any
commercial and industrial property tax replacement monies that may be received under chapter
441.21A shall not be included in the calculation to determine the amount of Economic
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Development Grants for which Developer is eligible, and any monies received back under chapter
426C relating to the Business Property Tax Credit shall not be included in the calculation to
determine the amount of Economic Development Grants for which Developer is eligible.
b. Each Economic Development Grant is subject to annual appropriation by the City
Council. The right of non-appropriation reserved to the City in this Section is intended by the
parties, and shall be construed at all times, so as to ensure that the City's obligation to make future
Economic Development Grants shall not constitute a legal indebtedness of the City within the
meaning of any applicable constitutional or statutory debt limitation prior to the adoption of a
budget which appropriates funds for the payment of that installment or amount. In the event that
any of the provisions of this Agreement are determined by a court of competent jurisdiction to
create, or result in the creation of, such a legal indebtedness of the City, the enforcement of the
said provision shall be suspended, and the Agreement shall at all times be construed and applied
in such a manner as will preserve the foregoing intent of the parties, and no Event of Default by
the City shall be deemed to have occurred as a result thereof. If any provision of this Agreement
or the application thereof to any circumstance is so suspended, the suspension shall not affect other
provisions of this Agreement which can be given effect without the suspended provision. To this
end the provisions of this Agreement are severable.
c. Notwithstanding the provisions of Section 9.1 hereof, the City shall have no
obligation to make an Economic Development Grant to Developer if at any time during the term
hereof the City fails to appropriate funds for payment, or Chapters 15A, 403 or 384 of the Code
are revised by the legislature or newly interpreted by a court of competent jurisdiction in such a
way that the Economic Development Grants or the use of the Tax Increments resulting from the
Minimum Improvements to fund the Economic Development Grants would violate the laws of the
State of Iowa. Upon a change in the Code or a new interpretation as described herein, the City
shall promptly forward written notice of the same to Developer and this Agreement shall terminate,
without penalty or other liability to the City. If the Agreement is not otherwise terminated pursuant
to its terms and the City Council fails to appropriate one or more annual Economic Development
Grants, the City Council may subsequently elect, in its discretion, to extend the time period during
which Economic Development Grants may be paid under this Agreement so as to provide
Developer with ten (10) total Economic Development Grants as otherwise provided for in Section
9.1.
Section 9.4. Use of Other Tax Increments. The City shall be free to use any and all Tax
Increments above and beyond the percentages to be given to Developer in this Agreement, or any
available Tax Increments resulting from the suspension or termination of the Economic
Development Grants, for any purpose for which the Tax Increments may lawfully be used pursuant
to the provisions of the Urban Renewal Act (including an allocation of all or any portion thereof
to the reduction of any eligible City costs), and the City shall have no obligations to Developer
with respect to the use thereof.
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Section 9.5. Real Property Taxes. Developer, and its permitted successors and assigns,
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 Development Property and Minimum Improvements. Until such
obligations have been assumed by any other person, all pursuant to the provisions of this
Agreement, Developer shall be solely responsible for all assessments and taxes.
Developer and its permitted successors agree that prior to the Termination Date:
a. They will not seek administrative review or judicial review of the applicability or
constitutionality of any tax statute relating to the taxation of real property contained on the
Development Property determined by any tax official to be applicable to the Development Property
or Minimum Improvements, or raise the inapplicability or constitutionality of any such tax statute
as a defense in any proceedings, including delinquent tax proceedings; and
b. They will not seek any tax exemption deferral or abatement either presently or
prospectively authorized under any State, federal or local law with respect to taxation of real
property contained on the Development Property, or the Minimum Improvements, between the
date of execution of this Agreement and the Termination Date.
c. The assessment category for the Development Property is commercial/ industrial,
and Developer shall not take any action to request or effect a change in such category.
ARTICLE X. RESERVED
ARTICLE XI. INDEMNIFICATION
Section 11.1. Release and Indemnification Covenants.
a. Developer releases the City and the governing body members, officers, agents,
servants and employees thereof (hereinafter, for purposes of this Article XI, the "Indemnified
Parties") from, covenant and agree that the Indemnified Parties shall not be liable for, and agree 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 or Development Property.
b. Except to the extent arising from any willful misrepresentation, gross negligence,
or any willful or wanton misconduct or any unlawful act of the Indemnified Parties, Developer
agrees to protect and defend the indemnified parties, now or forever, and further agree 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 Developer against the City to enforce its rights under this
Agreement); (ii) the acquisition and condition of the Development Property and the construction,
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installation, ownership, and operation of the Minimum Improvements; or (iii) any hazardous
substance or environmental contamination located in or on the Development Property.
c. The Indemnified Parties shall not be liable for any damage or injury to the persons
or property of Developer or Land Developer, or their officers, agents, servants or employees or
any other person who may be about the Public Improvements, Public Amenities, Minimum
Improvements, or Development Property 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. The Indemnified Parties shall not be liable for and will have no liability to
Developer or Land Developer associated with the specifications, design, plans, quality of
construction, or sufficiency of the Public Improvements of Public Amenities for any particular
purpose.
e. The provisions of this Article XI shall survive the termination of this Agreement.
ARTICLE XII. REMEDIES
Section 12.1. 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 during the Term of this Agreement:
a. Failure by Developer to cause the construction of the Minimum Improvements to
be completed and the operations to continue pursuant to the terms and conditions of this
Agreement;
b. Failure by Land Developer to comply with Sections 4.2 of this Agreement;
c. Failure by Developer or Land Developer to substantially observe or perform any
covenant, condition, obligation or agreement on its part to be observed or performed under this
Agreement;
d. Any representation or warranty made by Developer or Land Developer in this
Agreement or in any written statement or certificate furnished by Developer or Land 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;
e. Any failure to perform an obligation by the Land Developer hereunder shall be
deemed to be a default by the Developer.
Section 12.2. Remedies on Default. Whenever any Event of Default referred to in Section
12.1 of this Agreement occurs and is continuing, the City, as specified below, may take any one
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or more of the following actions after the giving of thirty (30) days' written notice by the City to
Developer, Land Developer and the holder of any Mortgage (but only to the extent the City has
been informed in writing of the existence of a 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 Developer or Land 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 Developer or Land Developer, deemed adequate by the City, that Developer or
Land Developer will cure the default and continue its performance under this Agreement;
b. The City may terminate this Agreement;
c. The City will have no obligation to make payment of Economic Development
Grants to Developer subsequent to the Event of Default; or
d. The City shall be entitled to recover from the Developer, and the Developer shall
pay to the City, the full amount of any monies that must be repaid to the State by the City under a
HQJP Agreement due to the Event of Default by the Developer or Land Developer.
Section 12.3. 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.
Section 12.4. No Implied Waiver. In 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 12.5. Agreement to Pay Attorneys' Fees and Expenses.
a. Developer shall pay to the City an amount equal to the actual costs incurred by the
City in connection with the drafting and execution of this Agreement, including, but not limited to
publication fees for legal notices, actual costs associated with City Council meetings, and
reasonable legal fees of the City, associated with the negotiation, drafting and authorization of this
Agreement. If not previously paid by Developer, the costs shall be deducted from the first
Economic Development Grant.
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b. Whenever any Event of Default occurs and the City 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 Developer or Land
Developer herein contained, and the City prevails in an action to enforce this Agreement,
Developer and Land Developer agree that the defaulting party shall, upon demand therefor, pay to
the City the reasonable fees of such attorneys and such other expenses as may be reasonably and
appropriately incurred by the City in connection therewith.
ARTICLE XIII. MISCELLANEOUS
Section 13.1. Conflict of Interest. Developer and Land Developer warrant that, to their
best knowledge and belief after due inquiry, no officer or employee of the City, or their 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 13.2. 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 Developer, is addressed or delivered personally to KC Kettlestone,
L.C. at 5000 Westown Parkway, Suite 400, West Des Moines, IA 50266;
b. In the case of Land Developer, is addressed or delivered personally to Ashworth
Properties Development, Inc. at 5000 Westown Parkway, Suite 400, West Des
Moines, IA 50266;
c. In the case of the City, is addressed to or delivered personally to the City at 230
West Hickman Road, Waukee, Iowa 50263, Attn: Becky Schuett, City Clerk;
or to such other designated individual or officer or to such other address as any party shall have
furnished to the other in writing in accordance herewith.
Section 13.3. 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 13.4. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall constitute one and the same instrument.
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Section 13.5. Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of Iowa.
Section 13.6. Entire Agreement. This Agreement and the exhibits hereto reflect the entire
agreement among 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 13.7. 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 permitted successors and
assigns.
Section 13.8. Termination Date. This Agreement shall terminate and be of no further force
or effect on and after December 31, 2031, unless terminated earlier under the provisions of this
Agreement.
Section 13.9. Memorandum of Agreement. The parties agree to execute and record a
Memorandum of Agreement for Private Development, in substantially the form attached as Exhibit
D, to serve as notice to the public of the existence and provisions of this Agreement, and the rights
and interests held by the City by virtue hereof. The City shall pay for all costs of recording.
Section 13.10. No Third-Party Beneficiaries. No rights or privileges of either party hereto
shall inure to the benefit of any landowner, contractor, subcontractor, material supplier, or any
other person or entity, and no such contractor, landowner, subcontractor, material supplier, or any
other person or entity shall be deemed to be a third-party beneficiary of any of the provisions
contained in this Agreement.
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,
and Developer and Land Developer have caused this Agreement to be duly executed in their names
and behalf by their authorized representatives, all on or as of the day first above written.
[Signatures start on the next page]
Execution Version Page - 24 -
(SEAL) CITY OF WAUKEE, IOWA
By: ________________________________
William F. Peard, Mayor
ATTEST:
By: ________________________
Becky Schuett, City Clerk
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this ________ day of ________________________, 2016, before me a Notary Public
in and for said State, personally appeared William F. Peard and Becky Schuett, to me personally
known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively, of the
City of Waukee, Iowa, a Municipality 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 Municipality, and that said
instrument was signed and sealed on behalf of said Municipality 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 Municipality by it voluntarily executed.
___________________________________
Notary Public in and for the State of Iowa
Execution Version Page - 25 -
KC KETTLESTONE, L.C.
an Iowa limited liability company
By: WCKLC-Sarasota, L.C., Member
By: ___________________________
Gerard D. Neugent, Manager
By: JSC Properties, Inc., Member
By: __________________________
Paul D. Hayes, President
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this _______ day of ________________, 2016, before me the undersigned, a Notary
Public in and for said State, personally appeared________, to me personally known, who, being
by me duly sworn, did say that he is the _____________of KC Kettlestone, L.C., and that said
instrument was signed on behalf of said company; and that the said ___________as such officer,
acknowledged the execution of said instrument to be the voluntary act and deed of said company,
by him voluntarily executed.
______________________________________
Notary Public in and for the State of Iowa
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this _______ day of ________________, 2016, before me the undersigned, a Notary
Public in and for said State, personally appeared________, to me personally known, who, being
by me duly sworn, did say that he is the _____________of KC Kettlestone, L.C., and that said
instrument was signed on behalf of said company; and that the said ___________as such officer,
acknowledged the execution of said instrument to be the voluntary act and deed of said company,
by him voluntarily executed.
______________________________________
Notary Public in and for the State of Iowa
Execution Version Page - 26 -
ASHWORTH PROPERTIES DEVELOPMENT, INC.,
an Iowa corporation
By: ____________________________
Gerard D. Neugent, Vice President & Secretary
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this _______ day of ________________, 2016, before me the undersigned, a Notary
Public in and for said State, personally appeared Gerard D. Neugent, to me personally known,
who, being by me duly sworn, did say that he is the Vice President and Secretary of Ashworth
Properties Development, Inc. and that said instrument was signed on behalf of said company; and
that the said Gerard D. Neugent as such officer, acknowledged the execution of said instrument to
be the voluntary act and deed of said company, by him voluntarily executed.
______________________________________
Notary Public in and for the State of Iowa
Execution Version Page - A- 1 -
EXHIBIT A
LAND DEVELOPER PROEPRTY AND DEVELOPMENT PROPERTY
The Land Developer Property is described as follows:
That portion of the Gateway Urban Renewal Area owned by the Land Developer and to be
transferred to the City consisting of the public right of way for the extension of Esker Ridge Dr
east from Grand Prairie Parkway through the intersection of Esker Ridge Dr and Glacier Trail as
depicted in the acquisition plat contained in Exhibit I-1.
The Development Property is described as follows:
Lot 1 of Ashworth North Plat 1, an Official Plat to be recorded in the City of Waukee, Dallas
County, Iowa, depicted as follows:
Execution Version Page -B - 1 -
EXHIBIT B
MINIMUM IMPROVEMENTS
Minimum Improvements shall mean the construction of an approximately 90,000 square foot, two
story building to be used for office space on the Development Property which is presently a vacant parcel
of land, and all necessary site improvements including but not limited to adequate parking.
The construction of the Minimum Improvements are expected to be completed in 2018.
Construction costs for the Minimum Improvements are anticipated to be no less than approximately
$27,263,500. The Dallas County Assessor will make the final determination as to the assessed value.
A site plan further describing the Minimum Improvements is attached as Exhibit B-1.
Execution Version Page -B - 2 -
EXHIBIT B-1
[Preliminary Site Plan]
Execution Version Page -C - 1 -
EXHIBIT C
CERTIFICATE OF COMPLETION
MINIMUM IMPROVEMENTS
WHEREAS, the City of Waukee, Iowa (the "City") and KC Kettlestone, L.C. (the “Developer”),
did on or about the _____ day of ____________________, 2016, make, execute and deliver, each to the
other, an Agreement for Private Development (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:
Lot 1 of Ashworth North Plat 1, an Official Plat to be recorded in the City of Waukee, Dallas County,
Iowa
(the "Development Property"); and
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, 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 Agreement to permit the execution and recording of this certification.
NOW, THEREFORE, this is to certify that all covenants and conditions of the Agreement with
respect to the obligations of Developer and its successors and assigns, to construct the Minimum
Improvements on the Development Property have been completed and performed by Developer and are
hereby released absolutely and forever terminated insofar as they apply to the land described herein. The
County Recorder of Dallas 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.
[Signatures Start on Next Page]
Execution Version Page -C - 2 -
(SEAL) CITY OF WAUKEE, IOWA
By: ________________________________
ATTEST: William F. Peard, Mayor
By: ______________________________
Becky Schuett, City Clerk
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this ________ day of ________________________, 2016, before me a Notary Public in and
for said State, personally appeared William F. Peard and Becky Schuett, to me personally known, who
being duly sworn, did say that they are the Mayor and City Clerk, respectively, of the City of Waukee,
Iowa, a Municipality 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 Municipality, and that said instrument was signed and sealed
on behalf of said Municipality 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 Municipality by it voluntarily
executed.
__________________________________
Notary Public in and for the State of Iowa
Execution Version Page D - 1 -
EXHIBIT D
MEMORANDUM OF AGREEMENT FOR PRIVATE DEVELOPMENT
WHEREAS, the City of Waukee, Iowa (the "City"), KC Kettlestone, L.C., an Iowa limited
liability company (“Developer”), and Ashworth Properties Development, Inc., an Iowa
corporation (“Land Developer”) did on or about the _____ day of _______________, 2016, make,
execute and deliver, each to the other, an Agreement for Private Development (the "Agreement"),
wherein and whereby Developer agreed, in accordance with the terms of the Agreement and the
Gateway Urban Renewal Plan (the "Plan"), to develop and operate certain real property located
within the City and within the Gateway Urban Renewal Area.
The Development Property is described as follows:
Lot 1 of Ashworth North Plat 1, an Official Plat to be recorded in the City of Waukee, Dallas
County, Iowa
(the "Development Property"); and
WHEREAS, the term of the Agreement commenced on the ____ day of
________________, 2016 and terminates on December 31, 2031, unless otherwise terminated as
set forth in the Agreement; and
WHEREAS, the City and Developer desire to record a Memorandum of the Agreement
referring to the Development Property and their respective interests therein.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS:
1. That the recording of this Memorandum of Agreement for Private Development
shall serve as notice to the public that the Agreement contains provisions restricting development
and use of the Development Property and the improvements located and operated on such
Development Property.
2. That all of the provisions of the Agreement and any subsequent amendments
thereto, if any, even though not set forth herein, are by the filing of this Memorandum of
Agreement for Private Development made a part hereof by reference, and that anyone making any
claim against any of said Development Property in any manner whatsoever shall be fully advised
as to all of the terms and conditions of the Agreement, and any amendments thereto, as if the same
were fully set forth herein.
3. That a copy of the Agreement and any subsequent amendments thereto, if any, shall
be maintained on file for public inspection during ordinary business hours in the office of the City
Clerk, Waukee, Iowa.
[Signatures Start on Next Page]
Execution Version Page D - 2 -
IN WITNESS WHEREOF, the City, Developer, and Land Developer have executed this
Memorandum of Agreement for Private Development on the ______ day of
___________________, 2016.
(SEAL) CITY OF WAUKEE, IOWA
By: ________________________________
William F. Peard, Mayor
ATTEST:
By: ________________________
Becky Schuett, City Clerk
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this ________ day of ________________________, 2016, before me a Notary Public
in and for said State, personally appeared William F. Peard and Becky Schuett, to me personally
known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively, of the
City of Waukee, Iowa, a Municipality 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 Municipality, and that said
instrument was signed and sealed on behalf of said Municipality 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 Municipality by it voluntarily executed.
___________________________________
Notary Public in and for the State of Iowa
Execution Version Page D - 3 -
KC KETTLESTONE, L.C.
an Iowa limited liability company
By: WCKLC-Sarasota, L.C., Member
By: ___________________________
Gerard D. Neugent, Manager
By: JSC Properties, Inc., Member
By: __________________________
Paul D. Hayes, President
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this _______ day of ________________, 2016, before me the undersigned, a Notary
Public in and for said State, personally appeared________, to me personally known, who, being
by me duly sworn, did say that he is the _____________of KC Kettlestone, L.C., and that said
instrument was signed on behalf of said company; and that the said ___________as such officer,
acknowledged the execution of said instrument to be the voluntary act and deed of said company,
by him voluntarily executed.
______________________________________
Notary Public in and for the State of Iowa
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this _______ day of ________________, 2016, before me the undersigned, a Notary
Public in and for said State, personally appeared________, to me personally known, who, being
by me duly sworn, did say that he is the _____________of KC Kettlestone, L.C., and that said
instrument was signed on behalf of said company; and that the said ___________as such officer,
acknowledged the execution of said instrument to be the voluntary act and deed of said company,
by him voluntarily executed.
______________________________________
Notary Public in and for the State of Iowa
Execution Version Page D - 4 -
ASHWORTH PROPERTIES DEVELOPMENT, INC.,
an Iowa corporation
By: ____________________________
Gerard D. Neugent, Vice President & Secretary
STATE OF IOWA )
) SS
COUNTY OF DALLAS )
On this _______ day of ________________, 2016, before me the undersigned, a Notary
Public in and for said State, personally appeared Gerard D. Neugent, to me personally known,
who, being by me duly sworn, did say that he is the Vice President and Secretary of Ashworth
Properties Development, Inc. and that said instrument was signed on behalf of said company; and
that the said Gerard D. Neugent as such officer, acknowledged the execution of said instrument to
be the voluntary act and deed of said company, by him voluntarily executed.
______________________________________
Notary Public in and for the State of Iowa
Execution Version Page -E - 1 -
EXHIBIT E
RESERVED
Execution Version Page -F - 1 -
EXHIBIT F
RESERVED
Execution Version Page -G - 1 -
EXHIBIT G
[HQJP Agreement]
Execution Version Page -H - 1 -
EXHIBIT H
FORM OF LEGAL OPINION (On firm letterhead)
Re: Development Agreement between Waukee, Iowa (“City”), and KC Kettlestone L.C.
(“Developer”).
As counsel for ________________ (the “Entity” in this letter) in connection with the execution
and delivery of a certain Development Agreement (the “Development Agreement”) between the Entity
and the City dated as of ________________ 2016 and referenced above, we hereby render the following
opinion:
We have examined the original certified copy, or copies otherwise identified to our satisfaction
as being true copies, of the following:
a. The governing documents of the Entity;
b. Resolution of the Entity at which action was taken with respect to the transactions
covered by this opinion;
c. The Development Agreement (the term “Development Agreement includes all Exhibits to
the “Development Agreement”);
and such other documents and records as we have deemed relevant and necessary as a basis for the
opinion set forth herein.
Based on the pertinent law, the foregoing examination and such other inquiries as we have
deemed appropriate, we are of the opinion that:
1. The Entity is duly organized and validly exists as a _____________ under the laws of the
State of Iowa and is qualified to do business in the State of Iowa. The Entity has full power and
authority to execute, deliver and perform in full the Development Agreement; and the Development
Agreement has been duly and validly authorized, executed and delivered by the Entity, and, assuming
due authorization, execution and delivery by the other parties thereto, is in full force and effect and is
valid and legally binding instrument of the Entity 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.
2. The consummation of the transaction contemplated by the Development Agreement and
the carrying out of the terms thereof, will not result in violation of any provision of, or in default under,
the operating agreement or any other governing documents of the Entity, or any indenture, mortgage,
deed of trust, indebtedness, agreement, judgment, decree, order, statute, rule, regulation or restriction to
which the Entity is a party or by which it or its property is bound or subject.
Very truly yours,
Execution Version Page -I - 1 -
EXHIBIT I
PUBLIC IMPROVEMENTS
Public Improvements shall mean the construction of the extension of Esker Ridge Dr east from
Grand Prairie Parkway to the intersection of Esker Ridge Dr and Glacier Trial, as depicted in exhibit I-1.
The Public Improvements are anticipated to be completed by December 1, 2017.
Execution Version Page I - 2 -
EXHIBIT I-1
PUBILC IMPROVEMENT DEPICTION
Execution Version Page J - 1 -
EXHIBIT J
PUBLIC AMENITIES DESCRIPTION
The Public Amenities shall include:
• 10’ wide PCC trail around south ponds with associated grading,
• Storm sewer intake and piping,
• Erosion control, and
• Trees and turf seeding,
all as further depicted in Exhibit J-1. The Public Amenities are anticipated to be completed by December
1, 2017.
Execution Version Page J - 2 -
EXHIBIT J-1
PUBLIC AMENITIES ILLUSTRATIONS
(2 pages)
Execution Version Page J - 3 -
01258620-1\21938-116