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EXHIBIT 10.65

 
AMENDED AND RESTATED
PORT OF DUBUQUE PUBLIC PARKING FACILITY
DEVELOPMENT AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
DIAMOND JO, LLC

This Amended and Restated Port of Dubuque Public Parking Facility Development
Agreement (the Agreement) is made as of this 1st day of October, 2007  by and
between the City of Dubuque, a municipal corporation of the State of Iowa
(City), and Diamond Jo, LLC (f/k/a DJ Gaming Company, LLC), a Delaware limited
liability company (DJDJ).

WHEREAS, DJ intends to develop a new casino in the Port of Dubuque of the City
of Dubuque, Iowa, (the DJ Development) on real estate legally described on
attached Exhibit A (the DJ Real Estate); and

WHEREAS, in conjunction with the DJ Development, the parties believe that it is
in both of their interests that City design, develop, finance and construct a
public multi-level public parking facility to be owned and operated by City on
real estate owned by City located adjacent to the DJ Real Estate and legally
described on attached Exhibit B (the Public Parking Facility Real Estate) and as
conceptually described on attached Exhibit C (the Public Parking Facility); and

WHEREAS, in connection therewith the City and DJ have heretofore entered into a
Port of Dubuque Public Parking Facility Development Agreement dated as of
February 5, 2007, as amended by a First Amendment to Port of Dubuque Public
Parking Facility Development Agreement approved by the City Council of the City
on March 21, 2007 and a Second Amendment to Port of Dubuque Public Parking
Facility Development Agreement dated as of August 6, 2007 (together, the
"Development Agreement"); and

WHEREAS, the City and DJ now desire to further amend and restate the Development
Agreement as set forth herein.

NOW, THEREFORE, in return for good and valuable consideration of the matters set
forth in the above and foregoing recitals it is hereby agreed as follows:

SECTION 1.                                DJ OBLIGATIONS.

1.1.           DJ Development.  DJ hereby agrees to construct on the DJ Real
Estate a casino development of not less than one hundred forty thousand
(140,000) square feet of floor space along with necessary site work at a cost of
approximately $45,000,000.00.

(1)           DJ agrees that the design of the DJ Development shall be subject
to the prior written approval of sightlines by Port of Dubuque Adams, L.L.C.

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(2)           DJ hereby agrees that construction of DJ Development shall be
commenced by no later than six months following the final approval of the design
by the City Manager after review by the Design Review Committee and shall be
substantially completed no later than eighteen months from the commencement of
construction.

(3)           The time frames for the performance of this obligation shall be
suspended due to unavoidable delays meaning delays, outside the control of DJ,
which are the direct result of strikes, other labor troubles, unusual shortages
of materials or labor, unusually severe or prolonged bad weather, acts of God,
fire or other casualty to the DJ Development, litigation commenced by third
parties which, by injunction or other similar judicial action or by the exercise
of reasonable discretion directly results in delays, or acts of any federal,
state or local government which directly result in extraordinary delays.  The
time for performance of such obligations shall be extended only for the period
of such delay.

1.2.           DJ Financial Commitment.  In consideration of the benefits to DJ
provided in this Agreement, DJ agrees to pay into an escrow account (the "Escrow
Account") administered by the City as provided in the Escrow Agreement, Exhibit
M, the sum of $6.35 million (the “Initial Advance”), provided that DJ shall be
allowed, at its sole discretion, to increase the amount of the Initial Advance
and receive a corresponding reduction in the minimum assessment provided under
Section 1.4 so that the aggregate amount of the Initial Advance and the Bond
proceeds under Section 2.3 remains unchanged.

(1)
The Initial Advance shall be applied by City toward the cost of designing and
constructing the Public Parking Facility.  DJ shall pay such Initial Advance as
costs and expenses are incurred by City within thirty (30) days of receipt of a
statement and accompanying documentation therefor from City as such costs and
expenses are incurred by City during the design of the Public Parking Facility.

(2)
If not sooner paid, the balance of the Initial Advance shall be paid by DJ to
City prior to and as a condition of the award by City of the construction
contract for the Public Parking Facility.

(3)
In the event the Public Parking Facility is not completed, for any reason other
than due to DJ’s material breach of this Agreement, in accordance in all
material respects with the design plans or budget as provided in this Agreement,
City shall be obligated to reimburse DJ for the portion of the Initial Advance
DJ paid by it pursuant to this Agreement.  Such reimbursement shall be payable
by City over time from amounts City receives from the State of Iowa for City's
one-half percent (½%) share of the adjusted gross receipts paid by DJ under Iowa
Code Section 99F.11 and from no other source of City funds.

(4)
It is agreed that this Agreement satisfies DJ's and City’s obligations under
Section 32 of the Lease Agreement between City and DJ.

 
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(5)
The parties agree that all contracts entered into by City for the design and
construction of the Public Parking Facility shall be for a fixed price or a
guaranteed maximum price (GMP), so as to allow for the establishment of a
maximum total cost for the design and construction of the Public Parking
Facility.

 
(a)
Any change orders or modifications to such contracts that will result in the
fixed price or the GMP, together with all previous change orders or
modifications, exceeding 110% of the fixed price or the GMP, shall require the
written consent of both City and DJ.

 
(b)
DJ agrees that in the event it so consents to such a change order or other
modification to a contract that will result in the fixed price or the GMP,
together with all previous change orders or modifications, exceeding 110% of the
fixed price or the GMP, it shall pay to City within thirty (30) days of receipt
of a statement from City the amount by which such costs exceed 110% of the fixed
price or the GMP.

 
(c)
If the amount by which such costs exceed the sum of the Initial Advance and the
proceeds of the Bonds described in Section 2.3 are determined prior to the award
by City of a contract for the construction of the Public Parking Facility and DJ
does not terminate this Agreement as provided in Section 3.1, DJ shall pay such
amount, together with a contingency amount of ten per cent (10%) of the amount
of the construction contract, to City prior to the award by City of the
construction contract.

(d)           Upon acceptance of the Public Parking Facility by the City Council
and after payment by City of all costs for the design and construction of the
Public Parking Facility, City shall refund to DJ any balance in the Escrow Fund,
if any, and all interest earned on the Initial Advance.  Any remaining proceeds
of the Bonds described in Section 2.3 shall be applied as set forth in the
resolution of the City Council authorizing their issuance and Section 2.3(4).

1.3.           Operating Costs of Public Parking Facility.  Following the
opening of the Public Parking Facility and continuing for the life of the Public
Parking Facility, DJ agrees to pay the reasonable and necessary
actual   operating costs incurred by City for the operation, security, repair
and maintenance of the Public Parking Facility. Such operating costs shall
include those listed on attached Exhibit K.

(1)
Any costs that exceed $1,100 during the first year of operation of the Public
Parking Facility (after the first year of operation of the Public Parking
Facility, the amount of such costs shall be adjusted annually by the increase,
if any, from the previous year in the Consumer Price Index for all items for All
Urban Consumers-U.S. City Average, published by the U.S. Department of Labor,
Bureau of Labor

 
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Statistics) and that have a useful life of 3 years or more shall be considered
capital items. City shall first use the funds paid by DJ under the first
unnumbered paragraph of Sec. 1.5 before requesting reimbursement from DJ for
additional capital maintenance costs.

(2)
DJ shall reimburse City for such costs within thirty (30) days of receipt of a
statement therefor from City providing reasonable documentation to support such
amount.

(3)
Following the opening of the Public Parking Facility, City will contract with DJ
at a total cost of $1.00 per year, for the maintenance and security requirements
of the Public Parking Facility pursuant to the Maintenance Services Agreement
attached hereto as Exhibit J.  Notwithstanding any provision in the Agreement to
the contrary, DJ agrees that City may in its sole discretion, with or without
cause, terminate the Agreement and provide such reasonable and customary
services with its own staff or contract with a third party for such services,
all costs for which DJ shall reimburse City as provided in this Agreement.  If
City terminates the Agreement, City shall purchase from DJ any equipment at its
depreciated value purchased by DJ for its maintenance and security requirements
under the Agreement.

(4)
Failure of DJ to make any payment required by this Section shall constitute an
Event of Default under Section 3.3 of this Agreement.

1.4.           Minimum Assessment.  The parties shall execute the Minimum
Assessment Agreement attached hereto as Exhibit D.  DJ shall provide City with a
guaranty in the form of Exhibit F for DJ’s obligation to pay real estate taxes
on the DJ Development.

1.5.           Sinking Fund.  DJ agrees to pay to City each year during the life
of the Public Parking Facility, commencing on the date of the opening of the
Public Parking Facility, and on anniversary of such date each year thereafter,
an amount equal to $80 per parking space in the Public Parking Facility adjusted
annually by the increase, if any, from the previous year in the Consumer Price
Index for all items for All Urban Consumers—U.S. City Average, published by the
U.S. Department of Labor, Bureau of Labor Statistics.

(1)
Such amount shall be separately accounted for by City and shall be drawn upon by
City from time to time to be used solely to satisfy the capital maintenance
requirements of the Public Parking Facility determined necessary by City in its
sole discretion.

(2)
For the purposes of this Agreement, "capital maintenance" shall mean any
expenditure, or related series of expenditures, in excess of $1,100 during the
first year of operation of the Public Parking Facility (after the first year of
operation of the Public Parking Facility, the amount of such costs shall be
adjusted annually by the increase, if any, from the previous year in the
Consumer Price Index for all items for

 
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All Urban Consumers-U.S. City Average, published by the U.S. Department of
Labor, Bureau of Labor Statistics) and that has a useful life of three years or
more.

(3)
Failure of DJ to make any payment required by this Section shall constitute an
Event of Default under Section 3.3 of this Agreement.

1.6.           Rental and Compensation for Parking Privileges.  DJ agrees to pay
to City the rental and compensation for parking privileges as provided in Par. 2
of the Lease Agreement Between the City of Dubuque, Iowa and DJ Gaming Company,
LLC, Exhibit G attached hereto, for the Term of the Lease Agreement and
thereafter for so long as Lots 1 and 2 described therein may remain available to
DJ at City’s sole discretion on the same basis as provided in the Lease
Agreement. Failure of DJ to make any payment required by this Section
constitutes a default of this Agreement and in addition to any other remedy,
City shall upon such default have the right to impose such fees as City
determines in its sole discretion for use of the Public Parking Facility.

1.7.           DJ acknowledges that City has the right in its sole discretion to
install parking meters on the streets in the Port of Dubuque.

1.8.           Real Estate Taxes.  DJ shall pay or cause to be paid during the
Term of this Agreement, when due, all real property taxes and assessments
payable with respect to all and any parts of the DJ Development. Failure of DJ
to make any payment required by this Section shall constitute an Event of
Default under Section 3.3 of this Agreement.

SECTION 2.                                CITY OBLIGATIONS.

2.1.           Design and Construction of the Public Parking Facility.  Subject
to the conditions set forth in this Agreement, City agrees to design and
construct the Public Parking Facility at a cost estimated to be approximately
$23,043,800.00 on the Public Parking Facility Real Estate.

(1)           The footprint of the Public Parking Facility shall be consistent
with the concept shown on Exhibit I, and in harmony with the DJ Development and
the Port of Dubuque Adams Development, L.L.C., and The Durrant Group, L.L.C.
Development in appearance and function.

(2)           City shall retain either YWS Architects or The Durrant Group,
Inc., based on whichever architect comes in with the lower bid, to design the
Public Parking Facility on terms acceptable to City in its sole discretion (the
"Project Architect").

(3)           City shall hold weekly progress meetings with the Project
Architect, DJ and its representatives during the design and construction of the
Public Parking Facility.
City agrees to allow DJ to provide input and comments on the design of the
Public Parking Facility, including but not limited to providing DJ timely copies
of all design documents and correspondence regarding design and providing timely
notice to DJ

 
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of any meetings regarding the design of the Public Parking Facility and allowing
DJ to attend such meetings.
 
(4)           In the event City fails to retain the Project Architect by March
1, 2007, DJ may at its option terminate this Agreement by written notice to
City. Termination of this Agreement shall be DJ’s sole remedy for failure of
City
                to retain the Project Architect. DJ shall not be entitled to
reimbursement of any costs or damages incurred by DJ in connection with this
Agreement.

(5)
City shall retain as a cost of the design of the Public Parking Facility an
architecture firm to provide such design review as City determines necessary of
the Project Architect’s design.

(6)
The parties agree that the Public Parking Facility shall be designed to include
a north façade alternate (the “North Façade Alternate”), which shall be included
as part of the plans and specifications for the Public Parking Facility and bid
at the same time as the primary construction contract for the Public Parking
Facility.    The City shall have the right, in its sole discretion and without
the prior consent of DJ, to either (i) accept a bid and proceed with the
construction of the North Façade Alternate as part of the primary construction
contract for the Public Parking Facility, or (ii) decline to accept a bid for
the North Façade Alternate when the primary construction contract is
awarded.  If the City determines not to accept a bid for the North Façade
Alternate when the primary construction contract for the Public Parking Facility
is awarded, the City shall calculate the average of all bids received for the
construction of the North Façade Alternate that were received at such time, and
the average amount so calculated or, if greater, the amount bid by the
contractor being awarded the primary construction contract, shall be included in
the amount of the Bonds described in Section 2.3 hereof.  The City shall place
the proceeds from the Bonds related to the North Façade Alternate in an interest
bearing account.  At any time prior to June 1, 2012, the City may determine to
use those Bond proceeds, and such other City funds as it may determine to be
appropriate, to construct the North Façade Alternate.  In the event the City
does not elect to use those Bond proceeds to construct the North Façade
Alternate prior to June 1, 2012, those Bond proceeds including investment income
thereon, will be applied to redeem Bonds on that date or as soon as is
practicable once such election is made pursuant to the redemption provisions of
the Bonds generally described in Section 2.3 (4) below.

2.2.           Use of Parking Lot by DJ.  City agrees that for so long as DJ is
not in default (as defined under Section 3.3 below), and subject to City’s right
to limit access to the Public Parking Facility during emergencies, severe
weather conditions, maintenance or other similar circumstances, the Public
Parking Facility shall remain open 24 hours per day, 7 days per week to the
general public, including but not limited to DJ’s patrons (but excluding DJ’s
employees who DJ agrees to prohibit from parking in the Public Parking
Facility), in each case free of charge and without any unreasonable
restrictions, but subject to the terms of the Development Agreement between
City, Port of Dubuque Adams Development,

 
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L.L.C., and The Durrant Group, L.L.C., and the Development Agreement between
City and The McGraw-Hill Companies.

City agrees no future development project in the Port of Dubuque over which City
has control or is able to exercise influence shall be approved by City unless
such development project contemplates and provides for parking sufficient to
accommodate the reasonable parking needs of such development for the foreseeable
future as determined by City in its sole discretion. It is acknowledged by DJ
that the Public Parking Facility is intended to be utilized for the shared
parking needs of the Port of Dubuque, including but not limited to the
development contemplated by Port of Dubuque Adams, L.L.C. and The Durrant Group,
L.L.C., as described in Exhibit E, the DJ Development, Dubuque County Historical
Society projects, and McGraw-Hill for employee parking as provided in Par. 12 of
the Development Agreement Between the City of Dubuque and The McGraw-Hill
Companies, Inc., Exhibit L attached hereto.

2.3.           City Financing Obligations.  City agrees, subject to the
conditions set forth in Section 2.4 below, to issue tax increment financing
bonds (the Bonds) for the remaining costs associated with the design and
construction of the Public Parking Facility in such amount as to allow for the
Bonds to be paid off over a period of thirty (30) years utilizing the
Incremental Property Tax Revenues (as defined below) and the income earned on
any reserve fund, in whole, or in part should the Incremental Property Tax
Revenues and income earned on any reserve fund exceed the Bond payment
obligations from the DJ Development and assuming a minimum assessment amount as
provided in Exhibit D.

(1)
Interest and principal shall be paid from Incremental Property Tax Revenues
generated by the DJ Development and income earned on the any reserve fund, as
provided in Exhibit D.

(2)
DJ recognizes and agrees that Incremental Property Tax Revenues are solely and
only the incremental taxes collected by City in respect to the DJ Development,
which does not include property taxes collected for the payment of bonds and
interest of each taxing district, and taxes for the regular and voter-approved
physical plant and equipment levy, and any other portion required to be excluded
by Iowa law.  Accordingly, the parties understand that due to the amounts that
are legally required to be excluded from the Incremental Property Tax Revenues,
such incremental taxes will not include all amounts paid by DJ as regular
property taxes.

(3)           DJ acknowledges and agrees that it shall identify for City a
purchaser for the Bonds (the Purchaser) and City agrees to negotiate in good
faith with the Purchaser with respect to the terms of the Bonds.  Except as
specifically set forth herein, DJ further acknowledges and agrees that the Bonds
shall be sold on such terms and conditions, bear such interest rates, have such
reserve funding requirements, mature at such times and in such amounts as City,
in its sole but reasonable, good faith discretion, shall determine to be
acceptable to it and the Purchaser and shall be payable from and secured solely
and only by a pledge of the Incremental

 
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Property Tax Revenues to be collected by City in respect of the DJ Development
and income earned on any reserve fund during a period not to exceed thirty (30)
years.

(4)
Proceeds of the Bonds shall be applied only to the payment of capitalized
interest thereon (if necessary), debt service reserve funding, costs of
issuance, and the payment of the costs of the design and construction of the
Public Parking Facility, including the funding of a contingency amount equal to
10% of the fixed price, GMP for the Public Parking Facility as provided in
Section 1.2(5) above (the "Contingency Amount").  The terms of the Bonds shall
provide in substance that the portion of the Bonds issued for the payment of the
costs of the design and construction of the Public Parking Facility, including
the funding of the Contingency Amount and including the Bonds issued in
anticipation of the construction of the North Facade Alternate, plus any income
earned thereon, and not so used for that purpose, shall be used by the City to
defease or call Bonds.

(5)           City shall have no obligation to fund the costs of the design and
construction of the Public Parking Facility to be paid hereunder from any source
other than the proceeds of the Bonds.

(6)           City's obligation to issue the Bonds and undertake its obligations
hereunder shall be subject in all respects to unavoidable delays, the provisions
of this Section and Section 2.4, and to the satisfaction of all conditions
required (in the reasonable judgment of bond counsel for City) by Chapter 403 of
the Code of Iowa, as amended, with respect to the issuance of the Bonds.

(7)           The parties agree that in the event the election is not made by
the City to construct the North Façade Alternate as provided in Section 2.1(6)
and the funds that are held in escrow for the North Façade Alternate are used to
call and satisfy a portion of the Bonds as provided in Section 2.3(4) above, any
excess Incremental Property Tax Revenues that are not attributable to an
increase in valuation of the DJ Development or the applicable tax rate and which
would have otherwise been used to pay principal and interest on the Bonds
related to the North Façade Alternate shall be placed in an interest earning
escrow account by the City and along with any income earned thereon, used to
call or defease the Bonds.  DJ shall have the right to select the Bonds that
will be called or defeased.

2.4.           Limitations on Financial Undertakings of City.  Notwithstanding
any other provisions of this Agreement, City shall have no obligation to DJ
under this Agreement to issue the Bonds or to fund the design or construction of
the Public Parking Facility, if any of the following conditions exist as of
October 20, 2007:

(1)           City is unable to complete the sale of the Bonds on such terms and
conditions as it shall deem necessary or desirable in its sole discretion; or

(2)           City is entitled (or, with the passage of time or giving of
notice, or both, would

 
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be entitled) under this Agreement to exercise any remedies set forth therein as
a result of any Event of Default;

(3)           DJ fails to sign the Minimum Assessment Agreement and provide City
with the guaranty required by Section 1.4; or

(4)           There has been, or there occurs, a material adverse change in the
financial condition of DJ, which change(s) make it substantially more likely, in
the reasonable judgment of City, that DJ will be unable to fulfill its covenants
and obligations under this Agreement.

2.5.           Use of Tax Increments.  DJ recognizes that City intends to
utilize the Incremental Property Tax Revenues collected each year in respect of
the DJ Development and the income generated on any reserve fund to pay debt
service on the Bonds.  Notwithstanding the foregoing, except as provided in
Section 2.3(7) above, City shall be free to use any excess Incremental Property
Tax Revenues not required for the satisfaction of the principal and interest
payments on the Bonds collected each year in respect of the DJ Development (for
example, those revenues resulting from increases in valuation of the DJ
Development or the applicable tax rate) for any purpose for which the
Incremental Property Tax Revenues may lawfully be used pursuant to the
provisions of the Urban Renewal Act, and City shall have no obligation to DJ
with respect to use thereof.

2.6.           Limitation on City Funding.  DJ acknowledges and agrees that it
is the intent of the parties that City shall not incur any costs related in any
way to the design, construction, or operation of the Public Parking Facility
which are not paid for or reimbursed by DJ or financed with the
Bonds.   Anything in this Agreement to the contrary notwithstanding, DJ's
obligation to pay costs and expenses in the event this Agreement is terminated
prior to the award of a construction contract and the Public Parking Facility is
not completed, shall be limited to the amount of City’s contract with the
Project Architect and City’s contract with a review architect as provided in
Par. 2.1.

SECTION 3. GENERAL TERMS AND CONDITIONS.

3.1.           Conditions Precedent.  If any of the following conditions has not
occurred prior to October 20, 2007, either party may terminate this Agreement
upon written notice to the other party.  DJ’s termination of this Agreement
shall be its sole remedy. DJ shall not be entitled to reimbursement of any costs
or damages incurred by DJ in connection with this Agreement. In the event DJ
elects to terminate this Agreement, DJ shall reimburse City for all reasonable
out-of-pocket costs incurred by City in connection with this Agreement and DJ
shall reimburse City for all such costs within thirty days of receipt by DJ of
City’s statement of such costs, including appropriate documentation thereof.

(1)
City shall have obtained all required design approvals from the Design Review
Committee for the Public Parking Facility and DJ shall have consented to such
design, which consent shall not be unreasonably withheld.

 
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(2)           DJ and the City shall have received all necessary approvals from
any governmental agency, utility, lender, security holder or other party whose
approval is required for the undertakings and obligations under this Agreement,
specifically including, but not limited to approval of this Agreement by the
Iowa Racing and Gaming Commission and a firm commitment from the Purchaser
regarding its purchase of the Bonds on terms satisfactory to City and DJ.

(3)
City shall have received and DJ shall have approved, bids pursuant to which it
can be determined that the Public Parking Facility can be designed and
constructed for an amount equal to or less than the sum of the amounts to be
provided by DJ under Section 1.2 and financed by City under Section
2.3.  Additionally, all such costs of design and construction shall be supported
by agreements with the contractors and other vendors that include a fixed price
or have a guaranteed maximum price (GMP) that permits the Public Parking
Facility to be constructed within the budget provided for herein, taking into
consideration a 10% contingency for the costs of construction of the Public
Parking Facility. The parties acknowledge that such fixed price or GMP shall be
subject to change modifications or orders approved by City, provided that any
change orders or modifications to such contracts that will result in the fixed
price or the GMP, together with all previous change orders or modifications,
exceeding 110% of the fixed price or the GMP, shall require the written consent
of both City and DJ.

(4)           City and DJ shall have agreed upon the construction cost and
timing of the construction of the Public Parking Facility.

(5)           DJ shall have signed the Minimum Assessment Agreement and provided
City with a guaranty in a form acceptable to City for DJ’s obligation to pay
real estate taxes on the DJ Development.

(6)           Both parties are obligated to pursue all required approvals as
expeditiously as possible and to negotiate in good faith to complete the
execution of the agreements identified and required as conditions precedent to
the other obligations set forth herein.

3.2.           Cooperation by the Parties.  City and DJ agree to cooperate in
good faith in connection with the performance of all of the activities
contemplated herein and to use all commercially reasonable efforts and diligence
to promptly respond and perform the obligations provided for directly or
indirectly by this Agreement.  The parties agree and understand that it is their
intent that the timing of the design and construction of the Public Parking
Facility will be such that the completion and opening of the Public Parking
Facility will coincide with the completion and opening of the DJ
Development.  The parties agree to use all reasonable effort and resources to
assure that construction of the Public Parking Facility commences on or before
October 20, 2007 and that the sections of the Public

 
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Parking Facility shown on Exhibit A attached hereto be completed and ready for
use on or before, the later of the opening of the DJ Development or the
following:

North Section, lower three levels: November 20, 2008

North Section, fourth level: January 16, 2009

South Section, all levels: January 16, 2009

In the event the sections of the Public Parking Facility are not substantially
completed and ready for use on such dates, and such delay is due to a breach by
the City of its obligations under this Agreement, the City shall pay to DJ an
amount equal to $100 per day that each section of the Public Parking Facility
remains incomplete and unopened by the foregoing dates as liquidated damages for
its breach of this Agreement.   Additionally, the parties agree that the
construction contract(s) shall include a liquidated damages provision that
provides for the contractor to pay to DJ the amount of $1,000 for each day each
section of the Public Parking Facility remains unfinished after the later of the
opening of the DJ Development and the foregoing dates.

3.3.           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:

(1)           Failure by DJ to pay or cause to be paid, before delinquency, all
real property taxes assessed with respect to the DJ Development.

(2)           Failure by DJ to cause the construction of the DJ Development to
be commenced and completed pursuant to the terms, conditions and limitations of
this Agreement.

(3)           Failure by DJ to substantially observe or perform any other
material covenant, condition, obligation or agreement on its part to be observed
or performed under this Agreement.

(4)           Any default provided for under Sections 1.3, 1.5, and 1.6 above.

3.4.           Remedies on Default by DJ.  Whenever any Event of Default
referred to in Section 3.3 of this Agreement occurs and is continuing, City, as
specified below, may take any one or more of the following actions after the
giving of written notice by City to DJ of the Event of Default, but only if the
Event of Default has not been cured within sixty (60) days following such
notice, or if the Event of Default cannot be cured within sixty (60) days and DJ
does not provide assurances to City that the Event of Default will be cured as
soon as reasonably possible thereafter:

 
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(1)           City may suspend its performance under this Agreement until it
receives assurances from DJ deemed adequate by City, that DJ will cure its
default and continue its performance under this Agreement;

(2)           Until October 19, 2007, City may cancel and rescind this
Agreement;

(3)           City shall be entitled to recover from DJ the sum of all amounts
expended by City in connection with this Agreement, and City may take any
action, including any legal action it deems necessary, to recover such amounts
from DJ;

(4)           City may take any action, including legal, equitable or
administrative action, which may appear necessary or desirable to collect any
payments due under this Agreement or to enforce performance and observance of
any obligation, agreement, or covenant under this Agreement;

     (5)              
City shall have the right to impose such fees as City determines in its sole
discretion for use of the Public Parking Facility.

3.5.           No Remedy Exclusive.  No remedy herein conferred upon or reserved
to City is intended to be exclusive of any other available remedy or remedies,
but each and every such 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.

3.6.           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.

3.7.           Additional Agreements.  From time to time hereafter without
further consideration,
the parties agree to execute and deliver, or cause to be executed and delivered,
such further agreements and instruments, and shall take such other actions, as
any party may reasonably request in order to more effectively memorialize,
confirm and effectuate the intentions, undertakings and obligations contemplated
by this Agreement.

3.8.           Counterparts.  This Agreement may be executed in any number of
counterparts with the same effect as if the parties hereto had signed the same
document.  All such counterparts shall constitute one instrument.

3.9.           Term.  This Agreement shall continue in effect during the life of
the Public Parking Facility.

3.10.        Additional Provisions.

 
092707balfinal
 
 

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(1)           It is hereby agreed and acknowledged that failure or performance
of breach of agreement by any party hereto could result in irreparable harm to
another party hereto.  An action in equity and the relief of specific
performance is therefore reserved to all parties hereto.

(2)           All exhibits attached to this Agreement are incorporated herein
and made a part hereof by this reference.

(3)           Whenever the singular number is used in this Agreement, the same
shall include the plural where appropriate and words of any gender shall include
any other gender where appropriate.

(4)           All notices, demands, requests or other communications required or
permitted by this Agreement shall be in writing and shall be deemed to be
received when actually received by any person at the intended address if
personally served or sent by courier or telex, or whether actually received or
not, twenty-four (24) hours after the date and time of delivery to a
nationally-recognized courier, address as follows:

To the City:       City Manager
        City Hall
        50 W. 13th Street
         Dubuque, IA 52001

Copies to:         City Attorney
        City Hall
        50 W. 13th Street
        Dubuque, IA 52001

To DJ:                        Attn. Natalie Schramm
                Diamond Jo, LLC
                400 E. 3rd Street
                Dubuque, IA 52001

With copies to:             Curtis E. Beason                    
                        Lane & Waterman LLP
               220 N. Main St., Ste. 600
                Davenport, IA  52801

Any party may, in substitution of the foregoing, designate a different address
or addresses within the continental United States for purposes of this section
by written notice delivered to the other party in the manner prescribed, at
least ten (10) days in advance of the date on which such change of address is to
be effective.

 
092707balfinal
 
 

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(5)           This Agreement embodies the entire agreement between and among the
parties and may be amended or supplemented only by an instrument in writing
executed by the parties hereto.

(6)           This Agreement may not be assigned without the written consent of
all other parties hereto, which consent shall not be unreasonably
withheld.  Subject to the foregoing, this Agreement shall be binding upon, inure
to the benefit of and be enforceable by the parties hereto and their respective
successors and assigns.

(7)           Time is of the essence in this Agreement and each and every
provision contained herein.

(8)           In the event of a dispute arising between or among the parties
hereto, each party shall be responsible for paying its own attorney’s fees and
court costs, if any, incurred in connection with such dispute.

(9)           This Agreement shall be governed by the laws of the State of Iowa
and shall be construed in accordance therewith and all of the rights and
obligations hereunder shall be determined in accordance with the laws of the
State of Iowa.  All parties acknowledge that they have negotiated this Agreement
in the City of Dubuque, Iowa and that the property at issue is located in the
City of Dubuque, Iowa.

(10)           The parties hereto represent to each other that each has the full
right, power and authority to enter into this Agreement and to fully perform its
obligations.  The persons executing this Agreement warrant and represent that
each has the authority to execute in the capacity stated and to bind the parties
herein.

(11)           No failure by any party hereto, at any time, to require the
performance of any other party or any term of this Agreement, shall in any way
affect the right of any party to enforce such terms, nor shall any waiver by any
party of any term hereof be taken or held to be a waiver of any other provision
of this Agreement.  No waiver of any term or provision of this Agreement shall
be effective unless the same is in writing, signed by the parties hereto.

(12)           City and DJ shall promptly record a Memorandum of Agreement in
the form attached hereto as Exhibit H in the office of the Recorder of Dubuque
County, Iowa.

CITY OF DUBUQUE, IOWA

By: ___________________________
Roy D. Buol, Mayor

By: ___________________________
Jeanne F. Schneider, City Clerk

DIAMOND JO, LLC

By: ___________________________

 
092707balfinal
 
 

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EXHIBIT LIST

Exhibit A                                DJ Real Estate Legal Description

 
Exhibit B
Public Parking Facility Real Estate Legal          Description

 
Exhibit C
Conceptual Description of Public Parking Facility

Exhibit D                                Minimum Assessment Agreement

 
Exhibit E
Port of Dubuque Adams Development, L.L.C.

 
and The Durrant Group, L.L.C. Proposal

 
Exhibit F
Guaranty

 
        Exhibit G
Lease Agreement Between the City of Dubuque, Iowa and DJ Gaming Company, LLC,

 
Exhibit H
Memorandum of Development Agreement

 
Exhibit I
Public Parking Facility Concept

 
Exhibit J
Maintenance Services Agreement

 
Exhibit K
Operating Costs

 
Exhibit L
Par. 12 of the Development Agreement Between the City of Dubuque and The
McGraw-Hill Companies, Inc.

 
       Exhibit M
Escrow Agreement

 
 

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Exhibit A
DJ Real Estate Legal Description
 
Lot 1 of Adams Company's 1st Addition, Lot 3 of Adam's Company 2nd Addition, and
Lots 1 2, 3, and 4 of Adams Company 3rd Addition, in Dubuque County, Iowa.

 
 

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    Exhibit B
Public Parking Facility Real Estate Legal Description
 
Part of Lots 1 and 2 of Adams Company’s 2nd Addition, in the City of Dubuque,
Iowa
 
 

 
 

 
 

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Exhibit C
Conceptual Description of Public Parking Facility

 
 

 
 

 
 

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[Graphic image of level one of parking garage omitted.]

 
 

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[Graphic image of level two of parking garage omitted.]

 
 

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[Graphic image of level three of parking garage omitted.]

 
 

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[Graphic image of level four of parking garage omitted.]

 
 

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[Graphic image of level five of parking garage omitted.]

 
 

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Exhibit D
Minimum Assessment Agreement

 
 

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Prepared by:  Barry A. Lindahl, 300 Main Street, Suite 330, Dubuque, Iowa
52001-4113
Return to:  Barry A. Lindahl, 300 Main Street, Suite 330, Dubuque, Iowa
52001-4113

MINIMUM ASSESSMENT AGREEMENT

THIS MINIMUM ASSESSMENT AGREEMENT, dated as of October 1, 2007, by and among the
CITY OF DUBUQUE, IOWA, (the "City"), DIAMOND JO, LLC, a Delaware limited
liability company (the "Company"), and the CITY ASSESSOR of the City of Dubuque,
Iowa (the "Assessor").

WITNESSETH:

WHEREAS, the City and Company have entered into an Amended and Restated Port of
Dubuque Public Parking Facility Development Agreement dated as of October 1,
2007 (the Development Agreement) regarding certain real property located in the
City, the legal description of which is contained in Exhibit A attached hereto
(the "Development Property"); and

WHEREAS, it is contemplated that the Company will undertake the construction of
a new casino facility (the "Casino") on the Development Property, as provided in
the Development Agreement; and

WHEREAS, pursuant to Section 403.6 of the Code of Iowa, as amended, the City and
the Company desire to establish a minimum actual value for the Development
Agreement and the new Casino improvements to be constructed thereon by the
Company pursuant to the Development Agreement (the "Minimum Improvements"); and

WHEREAS, the City and the Assessor have reviewed the preliminary plans and
specifications for the Minimum Improvements which it is contemplated will be
erected; and

WHEREAS, that City has authorized the issuance of $23,025,000.00 Urban Renewal
Tax Increment Revenue Bonds, Taxable Series 2007 (the "Bonds"), the proceeds of
which will be used to construct a parking facility on the property adjacent to
the Development Property, the principal of and interest on which Bonds are
expected to be paid from the real property taxes paid by the Company with
respect to the Development Property and the Minimum Improvements located
thereon.

--------------------------------------------------------------------------------

NOW, THEREFORE, the parties to this Minimum Assessment Agreement, in
consideration of the promises, covenants and agreements made by each other, do
hereby agree as follows:

1.           Upon substantial completion of construction of the above-referenced
Minimum Improvements, but no later than January 1, 2009, the minimum actual
taxable value which shall be fixed for assessment purposes for the Development
Property and the Minimum Improvements to be constructed thereon shall be not
less than Fifty-Seven Million Eight Hundred Ninety Thousand Six Hundred
Forty-Nine and no/100 Dollars ($57,890,649.00) (hereafter referred to as the
"Minimum Actual Value") until termination of this Minimum Assessment Agreement
on the date that all of the Bonds shall have been paid in full or provision for
their payment shall have been made (including without limitation the defeasance
thereof) (the "Termination Date").  The Minimum Actual Value shall be maintained
during such period regardless of (a) any failure to complete the Minimum
Improvements (b) destruction of all or any portion of the Minimum Improvements
(c) diminution in value of the Development Property or the Minimum Improvements
or (d) any other circumstance, whether known or unknown and whether now existing
or hereafter occurring.

2.           The Company shall pay, when due, all real property taxes and
assessments payable with respect to all and any parts of the Development
Property and the Minimum Improvements pursuant to the provisions of this Minimum
Assessment Agreement and the Development Agreement.  Such tax payments shall be
made without regard to any loss, complete or partial, to the Development
Property or the Minimum Improvements, any interruption in, or discontinuance of,
the use, occupancy, ownership or operation of the Development Property or the
Minimum Improvements by Company or any other matter or thing which for any
reason interferes with, prevents or renders burdensome the use or occupancy of
the Development Property or the Minimum Improvements.

3.           In the event that for any reason the Minimum Actual Value is not
realized or incremental taxes collected in respect of the Development Property
and the Minimum Improvements located thereon are insufficient to pay the
scheduled payments of principal and interest on the Bonds, the Company agrees to
pay as taxes, or, if and to the extent necessary, to make other supplementary
payments, in an aggregate amount necessary to pay when due the principal of and
interest on the Bonds, including any amounts due as a result of  scheduled
sinking fund payments, in each case promptly upon demand by the City.  The
parties intend that the annual amount of incremental taxes to be so collected
shall be not less than the annual requirement for scheduled principal and
interest on the Bonds.

--------------------------------------------------------------------------------

4.           The Company agrees that its obligations to make the tax payments
required hereby, to pay the other sums provided for herein, and to perform and
observe its other agreements contained in this Minimum Assessment Agreement and
in the Development Agreement shall be absolute and unconditional general
obligations of the Company (not limited to the statutory remedies for unpaid
taxes) and that the Company shall not be entitled to any abatement or diminution
thereof, or set off therefrom, nor to any termination of this Minimum Assessment
Agreement for any reason whatsoever.  The Company agrees not to request or
accept any abatement, settlement or other diminution of taxes resulting from the
application of prevailing tax rates to the Minimum Actual Value.

5.           The Company agrees that prior to the Termination Date it will not:

(a)           seek administrative review or judicial review of the applicability
or constitutionality of any tax statute relating to the taxation of property
contained as a part of the Development Property or the Minimum Improvements
determined by any tax official to be applicable to the Development Property, the
Minimum Improvements or the Company or raise the inapplicability or
constitutionality of any such tax statute as a defense in any proceedings,
including delinquent tax proceedings; or

(b)           seek any tax deferral or abatement, either presently or
prospectively authorized under Iowa Code Chapter 403 or 404, or any other State
or federal law, of the taxation of real property including improvements and
fixtures thereon, contained in the Development Property or the Minimum
Improvements between the date of execution of this Agreement and the Termination
Date; or

(c)           request the Assessor to reduce the Minimum Actual Value; or

(d)           appeal to the board of review of the County, State or to the
Director of Revenue of the State to reduce the Minimum Actual Value; or

(e)           cause a reduction in the actual value or the Minimum Actual Value
through any other proceedings.

6.           The Company further agrees:

(a)            to construct the Casino on the Development Property in accordance
with the plans approved by the Company and the City, and to operate and maintain
the Casino for so long as it is the owner such facility;

(b)            to maintain all required licenses with respect to the Casino,
including its license from the State of Iowa to operate the Casino as a gaming
facility;

--------------------------------------------------------------------------------

(c)            to purchase and maintain business interruption insurance with one
or more insurance companies qualified to do business in the State of Iowa in an
amount determined by management of the Company to be sufficient in accordance
with industry practice given the nature of its business but including in all
events the Company's obligation to make the tax and other payments described
herein during such business interruption.  That portion of the proceeds of such
insurance necessary to pay the debt service due on the Bonds shall be delivered
to the City by the Company in a timely manner so as to ensure such payment;

(d)            to purchase and maintain property loss and casualty insurance
with one or more insurance companies qualified to do business in the State of
Iowa in an amount not less than the replacement value of the Casino, which
proceeds from such insurance, if received by the Company and not applied or
intended to be applied toward reconstruction or replacement of the Casino, shall
be delivered to the City in an amount necessary, if any, to satisfy the
remaining debt service then due and owing under the Bonds; and

(e)             that any agreement for the sale of all or substantially all of
the assets of the Company shall include a covenant by the subsequent purchaser
to comply with all of the Company’s obligations under this Minimum Assessment
Agreement from and after the date of such sale.

Any breach by the Company of the covenants set forth in (a) through (e) above
shall constitute an Event of Default under the resolution of the City
authorizing the issuance of the Bonds.

7.           This Minimum Assessment Agreement shall be promptly recorded by the
Company with the Recorder of Dubuque County, Iowa.  Such filing shall constitute
notice to any subsequent encumbrancer or purchaser of the Development Property
(or part thereof), whether voluntary or involuntary, and this Minimum Assessment
Agreement shall be binding and enforceable in its entirety against any such
subsequent purchaser or encumbrancer, including the holder of any mortgage.  The
Company shall pay all costs of recording.

8.           Neither the preambles nor provisions of this Minimum Assessment
Agreement are intended to, or shall be construed as, modifying the terms of the
Development Agreement between the City and the Company.

9.           This Minimum Assessment Agreement shall not be assignable by the
Company without the consent of the City and shall not be assignable by the City
without the consent of the Company.  Notwithstanding any provision to the
contrary in this Minimum Assessment Agreement, in the event that the Company
provides prior notice to the City of a proposed assignment, accompanied by a
report from McGladrey & Pullen, LLP or another nationally recognized firm of
independent certified public accountants mutually agreed upon by the City and
the Company (in either event, which is not currently engaged by the Company, the
proposed assignee or the City), to the effect that in its opinion, based upon
the firm’s analysis of the most recent financial statements of the proposed
assignee and such other information as the firm considers appropriate, the
proposed assignment will not materially adversely affect the timely repayment of
all outstanding principal and interest on the Bonds, then the City’s consent to
the assignment shall not be withheld or delayed, and upon the assumption of this
Minimum Assessment Agreement by the assignee, the Company shall be fully
released from its obligations under this Minimum Assessment Agreement.  This
Minimum Assessment Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto and their respective successors and
permitted assigns.

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10.           Nothing herein shall be deemed to waive the Company's rights under
Iowa Code Section 403.6(19) to contest that portion of any actual value
assignment made by the Assessor in excess of the Minimum Actual Value
established herein.  In no event, however, shall the Company seek to reduce the
actual value to an amount below the Minimum Actual Value established herein
during the term of this Agreement.  This Minimum Assessment Agreement may be
amended or modified and any of its terms, covenants, representations, warranties
or conditions waived, only by a written instrument executed by the parties
hereto, or in the case of a waiver, by the party waiving compliance.

11.           If any term, condition or provision of this Minimum Assessment
Agreement is for any reason held to be illegal, invalid or inoperable, such
illegality, invalidity or inoperability shall not affect the remainder hereof,
which shall at the time be construed and enforced as if such illegal or invalid
or inoperable portion were not contained herein.

12.           The Minimum Actual Value herein established shall be of no further
force and effect and this Minimum Assessment Agreement shall terminate on the
Termination Date.

 
 

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THE CITY OF DUBUQUE, IOWA

By:   ______________________________
         Roy Buol, Mayor
ATTEST:

By:           _________________________
Jeanne Schneider, City Clerk

STATE OF IOWA                        )
                                        )  SS
COUNTY OF DUBUQUE            )

On this _______ day of _________________, 2007, before me a Notary Public in and
for said County, personally appeared Roy Buol and Jeanne Schneider to me
personally known, who being duly sworn, did say that they are the Mayor and City
Clerk, respectively of the City of Dubuque, Iowa, a Municipal Corporation,
created and existing under the laws of the State of Iowa, and that the seal
affixed to the foregoing instrument is the seal of said Municipal Corporation,
and that said instrument was signed and sealed on behalf of said Municipal
Corporation by authority and resolution of its City Council and said Mayor and
City Clerk acknowledged said instrument to be the free act and deed of said
Municipal Corporation by it voluntarily executed.

__________________________________
Notary Public in and for the State of Iowa

 
 

--------------------------------------------------------------------------------

 

DIAMOND JO, LLC

By:           ____________________________
Title:

STATE OF IOWA                      )
                                               )  SS
COUNTY OF DUBUQUE          )

On this _________ day of ___________________________, 2007, before me a Notary
Public in and for the State of Iowa, personally appeared
________________________, to me personally known, who being duly sworn, did say
that he is the _________________ of DIAMOND JO, LLC, a Delaware limited
liability company, who executed the foregoing instrument; and that
_____________________________ acknowledged the execution of said instrument to
be his voluntary act and deed, voluntarily executed.

___________________________________
Notary Public in and for said County and State

 
 

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CONSENT TO MINIMUM ASSESSMENT AGREEMENT

The undersigned, being the holder of one or more mortgages granted prior to the
date of the Minimum Assessment Agreement to which this Consent is attached, said
mortgage(s) encumbering a portion of the Development Property described therein,
hereby consents to the execution and recording of the foregoing Minimum
Assessment Agreement and agrees to be bound thereby.

WELLS FARGO FOOTHILL, INC.

By:           ___________________________________
Name

____________________________________
Title

STATE OF ____________                               )
) ss
COUNTY OF _____________                         )

On this _________ day of __________________, 2007, before me, the undersigned a
Notary Public in and for said County and State, personally appeared
_____________________, to me personally known, who being by me duly sworn, did
say that the person is the __________________________ of Wells Fargo Foothill,
Inc., a California corporation, executing the within and foregoing instrument;
that said instrument was signed on behalf of said corporation by authority of
the corporation; and that the said ______________________ as such officer
acknowledged the execution of said instrument to be the voluntary act and deed
of said corporation by it voluntarily executed.

_____________________________________
Notary Public

 
 

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CONSENT TO MINIMUM ASSESSMENT AGREEMENT

The undersigned, being the holder of one or more mortgages granted prior to the
date of the Minimum Assessment Agreement to which this Consent is attached, said
mortgage(s) encumbering a portion of the Development Property described therein,
hereby consents to the execution and recording of the foregoing Minimum
Assessment Agreement and agrees to be bound thereby.

U.S. BANK NATIONAL ASSOCIATION,
as trustee

By:           ___________________________________
Name

____________________________________
Title

STATE OF ____________                               )
) ss
COUNTY OF _____________                         )

On this _________ day of __________________, 2007, before me, the undersigned a
Notary Public in and for said County and State, personally appeared
_____________________, to me personally known, who being by me duly sworn, did
say that the person is the __________________________ of U.S. Bank National
Association, a national banking association, executing the within and foregoing
instrument; that said instrument was signed on behalf of said banking
association by authority of said banking association; and that the said
______________________ as such officer acknowledged the execution of said
instrument to be the voluntary act and deed of said banking association by it
voluntarily executed.

_____________________________________
Notary Public

 
 

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CERTIFICATION OF ASSESSOR

The undersigned, having reviewed the plans and specifications for the Minimum
Improvements to be constructed and the market value assigned to the land upon
which the Minimum Improvements are to be constructed, and being of the opinion
that the minimum market value contained in the foregoing Minimum Assessment
Agreement appears reasonable, hereby certifies as follows:  The undersigned
Assessor, being legally responsible for the assessment of the property described
in the foregoing Minimum Assessment Agreement, and in accordance with the
Minimum Assessment Agreement, certifies that the actual value assigned to such
land and improvements shall not be less than Fifty-Seven Million Eight Hundred
Ninety Thousand Six Hundred Forty-Nine and no/100 Dollars ($57,890,649.00) until
termination of this Minimum Assessment Agreement pursuant to the terms hereof.

____________________________________
City Assessor for the City of Dubuque, Iowa

______________________________
Date

STATE OF IOWA                                    )
                                            )  SS
COUNTY OF DUBUQUE                        )

Subscribed and sworn to before me by Richard Engelken, City Assessor for the
City of Dubuque, Iowa.

_________________________________
Notary Public in and for the State of Iowa

_________________________________
Date

 
 

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EXHIBIT A

DEVELOPMENT PROPERTY

The Development Property is described as consisting of all that certain parcel
or parcels of land located in the City of Dubuque, State of Iowa, more
particularly described as follows:

Lot 1 of Adams Company's 1st Addition,
Lot 3 of Adams Company 2nd Addition, and
Lots 1, 2, 3 and 4 of Adams Company 3rd Addition

 

 
 

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Exhibit E
Port of Dubuque Adams Development, L.L.C.
and
The Durrant Group, L.L.C. Proposal
 
 
 
[Separate document not inserted here]

 
 

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Exhibit F
Guaranty

 
 

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Prepared by Barry A. Lindahl, Esq. 300 Main Street Suite 330 Dubuque IA 52001
563.583.4113
Return to Barry A. Lindahl, Esq. 300 Main Street Suite 330 Dubuque IA 52001
563.583.4113

GUARANTY

THIS GUARANTY is given this 1st day of October, 2007, by Peninsula Gaming, LLC
(hereinafter referred to as "Guarantor").

WITNESSETH:

WHEREAS, Guarantor owns all of the issued and outstanding membership interests
of Diamond Jo, LLC ("DJ");

WHEREAS, DJ has entered into an Amended and Restated Port of Dubuque Public
Parking Facility Development Agreement dated as of October 1, 2007 (the
Development Agreement) between City and DJ;

WHEREAS, as part of the Development Agreement, DJ is agreeing to a minimum
assessment agreement on the DJ Real Estate, including the DJ Development (as
those terms are defined in the Development Agreement) and has agreed to pay all
property taxes assessed against the DJ Real Estate; and

WHEREAS, pursuant to section 1.4 of the Development Agreement and in
consideration for the City entering into the Development Agreement, Guarantor is
required to guaranty the payment of all property taxes assessed against the DJ
Real Estate.

NOW, THEREFORE, the Guarantor hereby agrees as follows:

SECTION 1.                                REPRESENTATIONS AND WARRANTIES OF
GUARANTOR. Guarantor hereby represents and warrants that:

1.1           It is not in violation of any provision of the laws of the States
of Iowa or any other State in which it currently conducts business except any
such violation which would not reasonably be expected to have a material adverse
effect on the business, properties, assets and financial condition of Guarantor
and DJ, taken as a whole.

1.2           It has the power and authority to execute, deliver and perform
this Guaranty and enter into and carry out the transactions contemplated herein
which are not in contravention of, and do not and will not constitute a default
under or conflict with or violate any indenture, mortgage, deed of trust,
guaranty, lease, agreement or other instrument to which the Guarantor or DJ are
a party or by which they or their property is bound or any law, administrative
regulation, court order or consent decree except any such default, conflict or
violation which would not reasonably be expected to have a  material adverse
effect on the business, properties, assets and financial condition of Guarantor
and DJ, taken as a whole.

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1.3           This Guaranty has been duly authorized, executed and delivered by
the Guarantor and all steps necessary have been taken to constitute this
Guaranty, when duly executed and delivered, a legal, valid and binding
obligation of the Guarantor.

1.4           This Guaranty is made in furtherance of the purposes of the
Guarantor and that the assumption by the Guarantor of the obligations of DJ
hereunder will result in direct financial benefits to the Guarantor.

SECTION 2.                                COVENANTS AND AGREEMENTS.

2.1           Unconditional Guaranty.  Guarantor hereby unconditionally and
irrevocably guarantees to the City the prompt and complete payment of all real
property taxes and assessments and other supplementary payments payable by DJ in
accordance with the terms of Section 1.8 of the Development Agreement and the
Minimum Assessment Agreement as and when said payments are therein required to
be made. 

2.2           Guaranty to Remain in Force Until Bonds are Paid.  The obligations
of Guarantor under this Guaranty shall be absolute, unconditional and
irrevocable and shall remain in full force and effect until the earlier to occur
of (i) the Termination Date (as defined in the Minimum Assessment Agreement),
and (ii) the date on which the Minimum Assessment Agreement is terminated in
accordance with its terms, and such obligations shall not be affected, modified
or impaired upon the happening from time to time of any event, including without
limitation any of the following, whether or not with notice to, or the consent
of, Guarantor:

(a)           the compromise, settlement, release or termination of any or all
of the obligations, covenants or agreements of City under the Development
Agreement;

(b)           the failure to give notice to Guarantor of the occurrence of an
event of default under the terms and provisions of this Guaranty or the
Development Agreement;

(c)           the waiver of the payment, performance or observance by City or
Guarantor of any of the obligations, covenants or agreements of them contained
in the Development Agreement or this Guaranty;

(d)           the extension of the time for performance of any obligation,
covenant or agreement under or arising out of the Development Agreement or this
Guaranty or the extension or the renewal of either thereof;

(e)           the modification or amendment (whether material or otherwise) of
any obligation, covenant or agreement set forth in the Development Agreement;

(f)           the taking or the omission of any of the actions referred to in
the Development Agreement and any actions under this Guaranty;

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(g)           any failure, omission, delay or lack on the part of City to
enforce, assert or exercise any right, power or remedy conferred on the City in
this Guaranty or the Development Agreement, or any other act or acts on the part
of City;

(h)           the voluntary or involuntary liquidation, dissolution, sale or
other disposition of all or substantially all the assets, marshaling of assets
and liabilities, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition with creditors or
readjustment of, or other similar proceedings affecting DJ or City or any of the
assets of them, or any allegation or contest of the validity of the Development
Agreement in any such proceeding;

(i)           to the extent permitted by law, the release or discharge of
Guarantor from the performance or observance of any obligation, covenant or
agreement contained in this Guaranty by operation of law;

(j)           any merger or consolidation involving the Guarantor or the
transfer by the Guarantor of all or substantially all of its assets;

(k)           the default or failure of Guarantor fully to perform any of his
obligations set forth in this Guaranty, provided that the specific enumeration
of the above-mentioned acts, failures or omissions shall not be deemed to
exclude any other acts, failures or omissions, though not specifically mentioned
above, it being the purpose and intent of this paragraph that the obligation of
Guarantor shall be absolute, unconditional and irrevocable to the extent herein
specified and shall not be discharged, impaired or varied until the Termination
Date (as defined in the Minimum Assessment Agreement) shall have
occurred.  Without limiting any of the other terms or provisions hereof, it is
understood hereunder, there shall be no obligation on the part of the City to
resort in any manner to any other person, firm or corporation, their properties
or estates.

2.3           Liability Not Affected by Bankruptcy.  Without limiting the
foregoing, it is specifically understood that any modification, limitation, or
discharge of the liability of DJ under the Development Agreement or of the
liability of the Guarantor hereunder arising out of or by virtue of any
bankruptcy, arrangement, reorganization or similar proceeding for relief of
debtors under Federal or State law hereafter initiated by or against the
Guarantor or DJ shall not affect, modify, limit, or discharge the liability of
the Guarantor hereunder in any manner whatsoever and this Guaranty shall remain
and continue in full force and effect and shall be enforceable against the
Guarantor to the same extent and with the same force and effect as if any such
proceedings had not been instituted; and it is the intent and purpose of this
Guaranty and the Guarantor shall and does hereby waive all rights and benefits
which might accrue to it by reason of any such proceeding and the Guarantor
agrees that it shall be liable to the City as provided herein, irrespective and
without regard to any modification, limitation, or discharge of the liability of
the Guarantor that may result from any such proceeding.

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2.4.           Right to Proceed Against Guarantor.  In the event of a default
under Section 3.3(1) of the Development Agreement or under the Minimum
Assessment Agreement, the City, in its sole discretion, shall have the right to
proceed first and directly against Guarantor under this Guaranty without
proceeding against or exhausting any other remedies which it may have under the
Development Agreement or otherwise and without resorting to any other security
held by the City.

2.5.           Waiver of Notice and Reliance on Guaranty.  Guarantor expressly
waives notice from the City of its acceptance and reliance on this
Guaranty.  Guarantor agrees to pay all costs, expenses and fees, including all
reasonable attorneys' fees, which may be incurred in enforcing or attempting to
enforce this Guaranty following any default on the part of Guarantor hereunder,
whether the same shall be enforced by suit or otherwise.

SECTION 3.                                MISCELLANEOUS.

3.1           This Guaranty shall be construed in accordance with and governed
by the laws of the State of Iowa.

3.2           This Guaranty is entered into pursuant to the Section 1.4 of the
Development Agreement.  Capitalized terms not otherwise defined herein shall
have the meanings provided in the Development Agreement.

3.3           In the event of a default by DJ under its obligation to pay
property taxes under the Development Agreement for which the Guarantor has
provided this Guaranty, the Guarantor expressly reserves and shall be entitled
to all defenses, claims and other rights of DJ against the City or any other
party.

3.4           Nonexclusive Remedy; Notice; Waiver; Amendment.  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 such remedy shall be cumulative
and shall be in addition to every other remedy given under this Guaranty or now
or hereafter existing at law or in equity.  No delay or omission to exercise any
right or power accruing upon any default, omission or failure of performance
hereunder 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.  In order to entitle the City to
exercise any remedy reserved to it in this Guaranty, it shall not be necessary
to give any notice, other than such notice as may be herein expressly
required.  In the event any provision contained in this Guaranty should be
breached by Guarantor and thereafter duly waived by the City, such waiver shall
be limited to the particular breach so waived and shall not be deemed to waive
any other breach hereunder.  No waiver, amendment, release or modification of
this Guaranty shall be established by conduct, custom or course of dealing, but
solely by an instrument in writing duly executed by the City and the
Guarantor.  This Guaranty may be amended or modified and any of its terms,
covenants, representations, warranties or conditions waived, only by a written
instrument executed by Guarantor and the City, or in the case of a waiver, by
the party waiving compliance.

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3.5           Entire Agreement. This Guaranty constitutes the entire agreement
and supersedes all prior agreements between the parties with respect to the
subject matter hereof and may be executed simultaneously in several
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.

3.6           Severability.  The invalidity or unenforceability of any one or
more phrases, sentences, clauses or Sections in this Guaranty shall not affect
the validity or enforceability of the remaining portions of this Guaranty, or
any part thereof.

3.7           Release.  Following the earlier to occur of (i) the Termination
Date (as defined in the Minimum Assessment Agreement), or (ii) termination of
the Minimum Assessment Agreement, this Guaranty shall by its terms terminate
and, upon request by Guarantor, the City shall release Guarantor from the
provisions of this Guaranty in writing.

3.8           Successors and
Assigns.                                                                This
Guaranty shall not be assignable by the Guarantor without the consent of the
City and shall not be assignable by the City without the consent of the
Company.  Notwithstanding any provision to the contrary in this Guaranty, in the
event that the Company provides prior notice to the City of a proposed
assignment, accompanied by a report from McGladrey & Pullen, LLP or another
nationally recognized firm of independent certified public accountants mutually
agreed upon by the City and the Company (in either event, which is not currently
engaged by the Company, the proposed assignee or the City), to the effect that
in its opinion, based upon the firm’s analysis of the most recent financial
statements of the proposed assignee and such other information as the firm
considers appropriate, the proposed assignment will not materially adversely
affect the timely repayment of all outstanding principal and interest on the
Bonds, then the City’s consent to the assignment shall not be withheld or
delayed, and upon the assumption of this Guaranty by the assignee, the Guarantor
shall be fully released from its obligations under this Guaranty.  This Guaranty
shall be binding upon and inure to the benefit of and be enforceable by the
parties hereto and their respective successors and permitted assigns.

IN WITNESS WHEREOF, the Guarantor has executed this Guaranty on the day and year
first above written.

 
 

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GUARANTOR:

PENINSULA GAMING, LLC

By: _____________________________

STATE OF IOWA                          )
) SS
COUNTY OF
DUBUQUE                                                                )

On this _______ day of ________________________, 2007, before me the
undersigned, a Notary Public in and for said County, in said State, personally
appeared ___________________________, to me personally known, who, being by me
duly sworn, did say that said person is the Guarantor, that the instrument was
signed on behalf of the Guarantor, and that he acknowledged the execution of the
instrument to be the voluntary act and deed of the Guarantor, by it and by
voluntarily executed.
_____________________________________
Notary Public in and for said County and State

 
 

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The foregoing Guaranty is hereby accepted on behalf of the City of Dubuque,
Iowa, this ___ day of __________, 2007.

CITY OF DUBUQUE, IOWA

By: __________________________
      Roy D. Buol, Mayor

ATTEST:

____________________________
Jeanne F. Schneider, City Clerk

 
 

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Exhibit G
Lease Agreement
Between
the City of Dubuque, Iowa
and
Peninsula Gaming Company, LLC,

 
 

 
 

 
 

--------------------------------------------------------------------------------

 

 
LEASE AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
PENINSULA GAMING COMPANY, LL.C.

THIS LEASE AGREEMENT, executed in duplicate, made and entered into this 1st day
of June, 2005 by and between THE CITY OF DUBUQUE, IOWA (hereinafter called the
"Landlord") whose address for the purpose of this Lease Agreement is City Hall,
50 West 13th Street, Dubuque, Iowa 52001 and PENINSULA GAMING COMPANY, L.L.C.
(hereinafter called the "Tenant") whose address for the purpose of this Lease
Agreement is 3rd Street - Ice Harbor, Dubuque, Iowa 52001,

1. PREMISES AND TERM. The Landlord, in consideration of the rents herein
reserved and of the agreements and conditions herein contained, on the part of
the Tenant to be kept and performed,. teases unto the Tenant and Tenant hereby
rents and leases from Landlord, according to the terms and provisions herein,
the following described real estate, situated in Dubuque County, Iowa, to wit: '

The patio area (Parcel B) as shown on Exhibit A attached hereto (but
specifically excluding the hydraulic lift located on Lot B) and by this
reference made a part hereof (the Leased Premises), legally described as a part
of Lot 6 of Ice Harbor Development, according to the recorded plat thereof,

with the improvements thereon and all rights, easements and appurtenances
thereto belonging, for a term commencing at midnight of the day previous to the
first day of the
lease term, which shall be on the 1st day of June. 2005, and ending at midnight
on the last
day of the lease term; which shall be on the 31st day of December, 2018, upon
the condition that the Tenant pays rent therefore, and otherwise performs as in
this Lease Agreement provides.

The Landlord reserves unto itself a. non-exclusive, perpetual Public Access
Easement, to run with the land, as shown on Exhibit A, for itself and for public
pedestrian access, said access to remain open, clear and unobstructed at all
times except as may be otherwise agreed to in writing by the Landlord.

Tenant agrees that its rights under the Revised Ice Harbor Parking Agreement for
Ice Harbor Urban Renewal District are terminated upon execution of this
Agreement. Landlord hereby grants to Tenant, its management employees and
patrons during the term
of this Agreement the non-exclusive privilege to park in' Parking Lots 1 and 2
shown on Exhibit A at no additional charge (other than the rent herein) to
Tenant, its management employees or patrons. Tenant agrees that Tenant will
require that all of its employees shall park only in parking lots owned by
Tenant or in a city-owned parking garage.
 
1 of 25
 

 
 

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Landlord hereby grants to Tenant permission, subject to such other permission as
may be required by any other governmental entity, to construct a two-story (not
to exceed the height of the existing portside facility) barge (as defined by
Iowa Code Chapter 99F (2005) to extend not more than the maximum permitted by
the United States Coast Guard and/or the United States Army Corps of Engineers
but in no event more than 150 feet from Tenant's current dock facility into the
Ice Harbor. Landlord agrees to cooperate with and support Tenant's application
to other governmental entitles for any required permission for such barge. In
the event Tenant constructs such barge, the area upon which such barge is
located shall become a part of the Leased Premises.
 

 
2. RENTAL AND COMPENSATION FOR PARKING PRIVILEGES IN LOTS 1 AND 2. Tenant agrees
to pay to Landlord as rental and compensation for the non-exclusive parking
privileges for Lots I and 2 for said term, as follows:
 
 
(a) Rental. $ 25,000.00 per year in. advance, upon full execution of this Lease
Agreement, and $25,000.00 on the first day of June of each year thereafter,
adjusted as follows:

 
                 First Year of Lease term (2005-2006):
        $25,000

 
                 Second Year of Lease Term (2006-2007)
 $25,000

 
                 Third Year of Lease Term (2007-2008):
        $25,000

 
                 Fourth Year of Lease Term (2008-2009):
               $25,000

 
              Fifth Year of Lease Term (2009-2010):
               $25,000

 
 
Sixth Year of Lease Term (2010-2011):

 
 
$25,000.00 x COL Index June 1, 2010

 
 
________________________

 
COL Index June 1, 2009

 
Seventh Year of Lease Term (2011-2012):

 
$25,000.00 x COL Index June 1, 2011

 
________________________

 
COL Index June 1, 2009

 
Eighth Year of Lease Term (2012-2013):

 
$25,000.00 x COL Index June 1, 2012

 
________________________

 
COL Index June 1, 2009

 
Page 2 of 25

 
 

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Ninth Year of Lease Term (2013-2014):

 
$25,000.00 x COL Index June 1, 2013

 
________________________

 
COL Index June 1, 2009

 
Tenth Year of Lease Term (2014-2015):

 
$25,000.00 x COL Index June 1, 2014

 
________________________

 
COL Index June 1, 2009

 
Eleventh Year of Lease Term (2015-2016):

 
$25,000.00 x COL Index June 1, 2015

 
________________________

 
COL Index June 1, 2009

 
Twelfth Year of Lease Term (2016-2017):

 
$25,000.00 x COL Index June 1, 2016

 
________________________

 
COL Index June 1, 2009

 
Thirteenth Year of Lease Term (2017-2018):

 
$25,000.00 x COL Index June 1, 2017

 
________________________

 
COL Index June 1, 2009

 
Fourteenth Year of Lease Term (June 1, 2018-December 31, 2018):

 
$25,000.00 x COL Index June 1, 2018 (prorated)

 
________________________

 
COL Index June 1, 2009

 
COL Index means the Consumer Price Index for all items for All Urban
Consumers—U.S. City Average, published by the U.S. Department of Labor, Bureau
of Labor Statistics.

(b)  
Parking.  $225,000.00 per year at the rate of $18,750.00 per month beginning on
the 1st day of January 2009, and on the first day of each month thereafter,
adjusted as follows:

    First Year of Lease Term
(2005-2006):                                                                                                $
0

3 of 25

 
 

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    Second Year of Lease Term
(2006-2007):                                                                                             $
0
    Third Year of Lease Term
(2007-2008):                                                                                                $
0
    Fourth Year of Lease Term
(2008-2009)                                                                                               $
0
    Fifth Year of Lease Term
(2009-2010):                                                                                                 
$225,000.00
    Sixth Year of Lease Term (2010-2011:
    $225,000.00 x COL Index June 1, 2010
___________________________
COL Index June 1, 2009 (base year)

Subsequent years of the lease Term shall be adjusted by the COL Index in the
same manner, using 2009 as the base year.

(c)  
Parking.  In the event, however, that Tenant expands its facilities as provided
in the Eleventh Amendment to the Operating Agreement between the Dubuque Racing
Association and Tenant, dated the 31st day of May,2 005, Tenant’s payment to
Landlord under this Par. 2(b) shall be as follows:

$475,000.00 per year at the rate of $39,583.33 per month beginning on the 1st
day of the operation of such new facilities, and on the first day of each month
thereafter, adjusted by the COL Index in the manner provided in (a) and (b)
using the year prior to the first year of the operation of the new facilities as
the base year.

All sums shall be paid at the address of Landlord, as above designated, or at
such other place in Iowa, or elsewhere, as the Landlord may, from time to time,
designate in writing.

3.  POSSESSION.  Tenant shall be entitled to possession on the first day of the
term of this Lease Agreement, and shall yield possession to the Landlord at the
time and date of the close of this lease term, except as herein otherwise
expressly provided.  Should Landlord be unable to give possession on said date,
Tenant’s only damages shall be a rebating of the pro rata rental.

4.  USE OF PREMISES

It is contemplated between the parties that the Demised Premises shall be used
by Lessee for concerts (primarily but not limited to Wednesdays and Fridays),
entertainment and food service to the customers ot Lessee and other members of
the public and that attendance at some of the events will require an admission
fee or other charge and some will be without charge.  Lessee shall have the
right, at its option, during the term of this Lease, to use the Improvements (as
defined below) and the Demises

4 of 25

 
 

--------------------------------------------------------------------------------

 

Exhibit H
Memorandum of Agreement
 
 

 
 

--------------------------------------------------------------------------------

 

Prepared by:   Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563
583-4113
Return to: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563
583-4113

MEMORANDUM OF DEVELOPMENT AGREEMENT

The AMENDED AND RESTATED PORT OF DUBUQUE PUBLIC PARKING FACILITY DEVELOPMENT
AGREEMENT BETWEEN THE CITY OF DUBUQUE, IOWA AND DIAMOND JO, LLC (the Development
Agreement) was made regarding the following described premises:

The Development Agreement is dated for reference purposes the ____ day of
_________, 20__, and contains covenants, conditions, and restrictions concerning
the sale and use of said premises.

This Memorandum of Development Agreement is recorded for the purpose of
constructive notice. In the event of any conflict between the provisions of this
Memorandum and the Development Agreement itself, executed by the parties, the
terms and provisions of the Development Agreement shall prevail.  A complete
counterpart of the Development Agreement, together with any amendments thereto,
is in the possession of the City of Dubuque and may be examined at its offices
as above provided.

Dated this ____ day of __________, 20__.

 
CITY OF DUBUQUE, IOWA
 

By:
__________________________                                                                                                
      Roy D. Buol, Mayor

By: ____________________________
      Jeanne F. Schneider, City Clerk

 
 

--------------------------------------------------------------------------------

 

STATE OF IOWA
      :   ss:
DUBUQUE COUNTY

On this  ____day of _________, 20__, before me, a Notary Public in and for the
State of Iowa, in and for said county, personally appeared Roy D. Buol and
Jeanne F. Schneider, to me personally known, who being by me duly sworn did say
that they are the Mayor and City Clerk, respectively of the City of Dubuque, a
Municipal Corporation, created and existing under the laws of the State of Iowa,
and that the seal affixed to said instrument is the seal of said Municipal
Corporation and that said instrument was signed and sealed on behalf of said
Municipal corporation by authority and resolution of its City Council and said
Mayor and City Clerk acknowledged said instrument to be the free act and deed of
said Municipal Corporation by it voluntarily executed.

__________________________________________
Notary Public, State of Iowa

 
 

--------------------------------------------------------------------------------

 

Exhibit I
Public Parking Facility Concept

 
 

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[Graphic Image of Parking Garage omitted]

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Exhibit J
Maintenance Services Agreement
 
 

 
 

--------------------------------------------------------------------------------

 

MAINTENANCE SERVICES AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
DIAMOND JO, LLC

This Agreement is made this ___ day of __________, 2007, between the City Of
Dubuque, Iowa (City), and Diamond Jo, LLC, (DJ).

Whereas, City and DJ have entered into the Amended and Restated Port of Dubuque
Public Parking Facility Development Agreement (the "Development Agreement")
dated October 1, 2007, which in part provides for City to design, develop,
finance, construct, own, and operate a parking ramp (the Public Parking
Facility); and

Whereas, City will design, develop, finance, construct, own, and operate the
multi-level Public Parking Facility; and

Whereas, DJ has agreed to pay the reasonable and necessary operating costs
incurred by City for the operation, security, repair, and maintenance of the
Public Parking Facility;  and

Whereas, Paragraph 1.3(3) of the Development Agreement provides that following
the opening of the Public Parking Facility, City will contract with DJ at a
total cost of $1.00 per year, for the maintenance and security requirements of
the Public Parking Facility and DJ agrees that City may in its sole discretion,
with or without cause, terminate this Agreement and provide such reasonable and
customary services with its own staff or contract with a third party for such
services, all costs for which DJ shall reimburse City as provided in this
Agreement and the Development Agreement; and that if City terminates the
Agreement, City shall purchase from DJ any equipment at its depreciated value
purchased by DJ for its maintenance and security requirements under the
Agreement; and

Whereas, pursuant to the Development Agreement the DJ has requested to provide
the maintenance and security requirements for the Public Parking Facility as
further provided herein.

IT IS AGREED BY AND BETWEEN THE PARTIES AS FOLLOWS:

SECTION 1.                                PURPOSE AND DESCRIPTION. DJ hereby
agrees to provide the maintenance and security for the Public Parking Facility
according to the terms and provisions of this Agreement.

SECTION 2.                                TERM OF AGREEMENT.  The term of this
Agreement shall commence upon the opening of the Public Parking Facility and
shall continue for a five (5) year period unless either party provides the other
with notice of termination not less than one hundred eight (180) days prior to
the end of the then current term; provided that, the City may terminate this

 
 

--------------------------------------------------------------------------------

 

Agreement at its sole discretion, with or without cause or the occurrence of an
event of default at any time on not less than thirty (30) days written notice to
DJ.

SECTION 3.                                COMPENSATION. As compensation for the
services performed hereunder, DJ shall be paid $1.00 per year.

SECTION 4.                                MAINTENANCE AND OPERATION.

4.1.           Maintenance.  DJ shall perform the following maintenance on the
Public Parking Facility:

(1)            Regular and routine maintenance of the Public Parking Facility
shall be performed, which shall include, but not be limited to, daily pickup of
trash and debris, daily cleaning of lobbies on all floors, all stairs, landings,
elevators, and restrooms, replacing of lamps and restroom supplies (lamps,
disposable restroom supplies, general lawn care, maintenance, and replacement of
landscaping, and cleaning supplies shall be furnished by DJ) and other routine
care of the Public Parking Facility.

(2)            Necessary special maintenance operations as circumstances require
shall be performed, including, but not limited to, removal of snow, ice and
slush from entrances, exits, steps and sidewalks, general lawn care and
maintenance of the landscaping. Snow and ice removal is to be completed by 8:00
a.m. each day and as soon as precipitation ends at other times of the day. The
top parking level, including all exposed parking areas, is to be cleared after
precipitation ends. All snow piles shall be removed from the Public Parking
Facility within twenty-four (24) hours after snowfall ends

(3)            Sweeping and cleaning of the Public Parking Facility on an as
needed basis but not less than monthly.
(4)            All preventive maintenance described on the attached Exhibit A at
the times indicated therein.

(5) DJ shall purchase or lease all equipment necessary to provide the services
herein.

4.2.           Services.  DJ shall provide and perform the following services
for the Public Parking Facility:

(1)            All necessary utilities shall be maintained at control levels as
approved by City and shall be paid by the DJ.

(2)            Security services including, but not limited to as follows: (i)
providing assistance to Public Parking Facility tenants with problems in
entering and

 
 

--------------------------------------------------------------------------------

 

exiting the Public Parking Facility; (ii) monitoring and responding to all
security equipment; (iii) maintaining an emergency plan covering emergencies
occurring in the Public Parking Facility (iv) routine patroling of the Public
Parking Facility by security personel; (v) monitoring of security cameras (which
shall also be monitored at the 911 Emergency Communications Center); and (vi)
such other security measures as the City shall reasonably require.

(3)            Such other services as City may reasonably require from time to
time that are necessary to maintain and operate the Public Parking Facility in a
manner consistent with the standards of operation of other parking Public
Parking Facilityfacilities in the City of Dubuque.

SECTION 5.                                RIGHT TO INSPECT AND MAKE REPAIRS.

5.1.           City shall have the right any time to:

(1)           Inspect the Public Parking Facility.

(2)           Perform maintenance and make repairs and replacements in any case
where DJ is obligated to do hereunder and where DJ has failed, after reasonable
notice, to do so, in which event DJ shall reimburse City for the cost thereof,
promptly upon demand.

(3)           Perform maintenance and make repairs and replacements in any case
where City determines that it is necessary or desirable, to do so, in order to
preserve the safety of the facilities or to correct any condition likely to
cause injury or damage to persons or property.

SECTION 6.                                STANDARDS OF SERVICE.  It is the
policy of City that the Public Parking Facility shall be operated in an
efficient manner, giving the best possible service to the public.  DJ agrees to
cooperate at all times in support of this policy and to manage and operate the
Public Parking Facility in-accordance with the terms and conditions of this
Agreement.

SECTION 7.                                INSURANCE REQUIREMENTS

7.1.           DJ shall acquire and maintain at its own expense insurance as set
forth in the attached Insurance Schedule as such schedule may from time to time
be amended by City.

7.2           Before assuming operation of the Public Parking Facility, DJ shall
submit to City certificates of insurance required under this Section.

7.3           City shall provide general liability insurance coverage for City,
its officers and employees, and fire and casualty insurance coverage for the
Public Parking Facility, which shall be included as operating costs paid by DJ.

SECTION 8.                                PAYMENT OF EXPENSES. All operating
costs for the Public Parking Facility shall be paid by DJ as provided in Section
1.3 of the Development Agreement. Capital

 
 

--------------------------------------------------------------------------------

 

maintenance items shall be paid from the Sinking Fund described in Section 1.5
of the Development Agreement.

SECTION 9.                                ASSIGNMENT.  DJ shall not, at any
time, assign this Agreement or any part hereof, without the prior written
consent of City.

SECTION 10.                                GENERAL PROVISIONS.

10.1.                      Compliance With Law.  DJ shall comply, at all times
during the term of this Agreement, with all applicable ordinances and laws of
the City of Dubuque, county, or state government or of the United States
Government, and of any political division or subdivision or agency authority or
commission thereof that may have jurisdiction to pass laws or ordinances with
respect to the Public Parking Facility.

10.2.                      Reservation Of Rights.  Any and all rights and
privileges not granted to DJ by this Agreement are hereby reserved for and to
City.

10.3.                      Governing Law. This Agreement and all disputes
arising hereunder shall be governed by the laws of the State of Iowa.

10.4.                      Nonwaiver Of Rights. No waiver of default by either
party of any of the terms, covenants, and conditions hereof to be performed,
kept, and observed by the other party shall be construed as, or shall operate
as, a waiver of any subsequent default of any of the terms, covenants, or
conditions herein contained, to be performed, kept, and observed by the other
party.

10.5.                      Severability. If one or more clauses, sections, or
provisions of this Agreement, or the application thereof, shall be held to be
unlawful, invalid, or unenforceable, the remainder and application hereof of
such provision shall not be affected thereby, provided, however, that if any
provisions herein allowing termination of this Agreement by City in its sole
discretion shall be held to be unlawful, invalid, or unenforceable, then this
entire Agreement shall be void.

10.6.                      Paragraph Headings. The paragraph headings contained
herein are for convenience in reference and are not intended to define or limit
the scope of any provision of this Agreement.

10.7.                      Force Majeure. Neither party will be liable for
delays in performance caused by acts of God or government authority, strikes, or
labor disputes, or other cause beyond the reasonable control of that party.

10.8.                      Entire Agreement. This Agreement, together with all
the Development Agreement and exhibits attached hereto and thereto, constitute
the entire Agreement between the parties hereto, and all other representations
or statements heretofore made, verbal, or written, are merged herein, and this
Agreement may be amended only in writing, and executed by duly authorized
representatives of the parties hereto.

 
 

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10.9.                      Partnership Disclaimer. It is mutually understood
that nothing in this Agreement is intended or shall be construed as in any way
creating or establishing the relationship of partners between the parties
hereto.

10.11.                      Agreement Construction. Words and phrases herein
shall be construed as in the singular or plural, number, and a masculine,
feminine, or neuter gender, according to the context.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.

CITY OF DUBUQUE,
IOWA                                                                                     DIAMOND
JO, LLC

By:                                                                                By:                                                      
      Its                                                                                                      
Its

 
 

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EXHIBIT A

MAINTENANCE SCHEDULE

 
 

--------------------------------------------------------------------------------

 

 
EXHIBIT A

PREVENTIVE MAINTENANCE REQUIREMENTS

 
 

--------------------------------------------------------------------------------

 

 
INTRODUCTION

This plan is intended to assist those involved in establishing and funding an
operating maintenance program for the Port of Dubuque ramp.

The maintenance program is divided into three categories:

                Operational:
Most maintenance is provided by onsite dairy employee(s). Some maintenance is
provided by professionals, usually under a maintenance contract. This work
maintains the routine operation of the facility.

 
     Aesthetics:
     Partially provided by onsite daily employee(s) and partially by an outside
professional. This work addresses primarily the appearance of the facility.

 
  Structural:
      Initial observations provided by onsite daily employees) augmented by
professional inspection and maintenance. This work addresses the long term
structural integrity of the facility.

A chart establishing a maintenance schedule with required daily, weekly,
monthly, quarterly, semi-annual, and annual maintenance tasks is provided.
 

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PREVENTATIVE MAINTENANCE PROGRAM

Operational and aesthetic maintenance is ongoing and must be planned for in the
operational budget. With good operational maintenance, electrical, mechanical,
and structural repairs should
be required less often. Good preventative maintenance reduces major repairs and
therefore should be planned for.

Operational maintenance must be in the daily routine of the onsite personnel.
Poor operational maintenance can read to costly repairs, can cause unsafe and
unsightly conditions, and can even close the facility. Operational maintenance
involves all building systems: cleaning floors, walls, windows, lobbies, etc.,
door and hardware operation, electrical and mechanical systems, parking control
systems, plumbing and drainage systems, roofing and waterproofing, safety
equipment, and ice or snow removal.

One of the most overlooked and least scheduled operations is cleaning. Proper
cleaning not only keeps the facility aesthetically pleasing, it reduces future
structural repairs. In the winter, chlorides, or salt, are brought into the
facility from the snow on the streets and sidewalks. This chloride will produce
future corrosion of embedded reinforcing and post tensioning steel. Simple floor
washing minimizes the amount of chloride absorbed into the concrete, thus
reducing future deterioration caused by the corrosion of the steel. Critical
areas, such as fiat areas, entrance ramps and drive aisles must be flushed
regularly. Full sized power washing equipment works best and should be scheduled
at least quarterly. Routine floor sweeping also reduces future damage by
unblocking drains and allowing water to freely flow to the drains and evaporate
as quickly as possible.

A solid plan for snow and ice removal is paramount. Improper application of
de-icing chemicals can cause extensive structural damage, damage to metal doors
and frames, and even damage to the landscaping.

It is important to minimize the use of any de-icing chemicals during the first
two years of a structure until is has obtained its full durability, however, use
of sand is prohibited. De-icing products must be approved by the Parking System
Supervisor.

Expansion joints can be damaged by snow plows, shovels, and ice scraping tools.
The snow plow operator must be familiar with the facility and must raise his
prow at the exposed expansion joint. The plow should approach the joint at an
angle rather than straight on, This wilt reduce the chance of catching the joint
on the edge of the plow. It may be helpful to place a colored flag or wall
marking adjacent to the joint for easy indentification.

Snow and ice removal around drains is of utmost importance. Daily observation
and cleaning should be scheduled as the ice and snow melt to prevent drain
blockage.

Snow plowing must be carefully controlled on the top deck of the ramp. It is
common for snow plow operators to pile the snow on one side or in one corner.
Piled snow will overload the structure. A plowing pattern and a plan of removal
must be developed to prevent overloading. This may include side chutes, an open
area for dumping the snow over the side of the ramp, the use of an open bed
truck for removal, or closing the top deck during heavy snow.

Operational maintenance and regularly scheduled professional preventative
maintenance on electrical, elevator, mechanical and plumbing systems, parking
control, and security systems will reduce unexpected breakdowns. Routine plans
for proper oiling, greasing, belt replacement, etc. should be carried out in
accordance with manufacturer's recommendations. Ail equipment requiring
professional preventative maintenance should be on contract for services. Before
the onset of winter,

 
 

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water pipes, sprinklers, hosebibs, and drain tines must be either drained of
water or their heating systems must be checked for good operation. Heat tapes,
if used, must be checked regularly during continuous operation.

Aesthetic maintenance is necessary for an attractive, well maintained
appearance. Some operational maintenance, such as regular sweeping and cleaning
also become aesthetic maintenance. Signs, graphics, and paint quality should be
routinely examined for good appearance.

Choosing the correct paint for painted concrete surfaces is essential for long
fasting paint and for the protection of the concrete. Water based latex paints
should always be chosen to be applied to concrete. Latex paints remain
breathable in service. Paints such as polymer paints are not breathable and will
peat off when moisture evaporates out of the concrete. Oil based paints are
somewhat breathable, however the natural alkalinity of concrete tends to
deteriorate the paint more rapidly than latex paint. Metal surfaces should be
painted with enamel paints or zinc-rich paints. Enamel paints are the best
general purpose paints for metal surfaces while zinc-rich paints are best for
high humidity areas or as a primer on exposed steel surfaces.

Good surface preparation including removal of dirt, oil, grease, and surface
contaminants must always be done before any paint is applied. For metal
surfaces, existing rust should be scraped to clean metal and primed before final
coating. All paints should be applied above 50 degrees Paint should not be
applied late in the day when conditions would allow condensation to occur at
night, or when rain is expected.

Structural examination begins with routine observation by the onsite personnel
and is augmented by a structural engineer if deterioration is noticed. Bienniel
examination by a structural engineer is recommended until the structure is
approximately 10 to 15 years old. After that, annual examination is recommended
due to the higher incidence of deterioration.

Onsite personnel should be made aware of how to recognize structural
deterioration and should notify property management if any is observed. Property
management personnel should know whom to contact if deterioration is observed.

Life expectancy of materials must also be accounted for when considering Fong
maintenance budgeting. The life expectancy of most of the equipment will be in
order of 20 years, at which time equipment must be replaced; the life of roofing
and plaza waterproof membranes will also be 20 years; The life of the traffic
bearing membrane will be approximately 10 years; the life of window sealants
will be approximately 20 years; the life of the building sealants, i.e.
caulking, will be approximately 8 to 10 years; and the life of the concrete
floor sealer is 5 years.

The following chart shows the frequency of performing the required maintenance.
In the chart,
"R" denotes the recommended frequency, "M" denotes the bare minimum frequency,
"P" denotes a required professional inspection. For those tasks with "M" only,
the minimum frequency is also the recommended frequency.

 
 

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Maintenance task frequency:  Daily (D), Weekly (W), Monthly (M), Quarterly (Q),
Seminannually (S), Annually (A), Note number (N)

 

                                                                                                   

 OPERATIONAL              
 1.  Cleaning  
                   Sweeping local areas  R  M                Complete ramp sweep
down    R  M              Sweep debris that collects in expansion    R  M      
           joints                    Empty trash cans  R  M                Clean
restrooms  M                  Cashier booths - floors, fixtures  R  M          
         walls, windows    R  M              Eleavators - floors, door tracks,
 R  M                    windows    R  M              Stairs - floors, door
tracks    R  M                  walls, windows  M    R M             Lobby      
             Complete ramp floor wash down with        R    M  1          power
wash                    Parking control equipment - directional    R  M        
         signage                    Remove ponding water              2      Ice
and snow removal              2  2.  Doors and Hardware                    Doors
close and mechanisms work  R  M                    properly              
     Lubrication - adjustment      R    M      3.  Electrical System            
       Check light fixtures, switches and    R  M                  operation    
               Relamp light fixtures              2      Distribution panels    
     R  P        Fire control system, if applicable    R  M      P  3
     Emergency generator, if applicable      M          4.  Elevators          
         Check for normal operation  R  M                Check indicator panels
and lights  R  M                Preventative maintenance service            P  3
 5.  Heating, Ventilation and Air Conditioning (HVAC)                    Check
for proper operation    R    M            Preventive maintenance service        
 M  P  3  6.  Parking Control System                    Check for proper
operation  R  M                Preventive maintenance service            P  3

 
 
 

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Maintenance task frequency:  Daily (D), Weekly (W), Monthly (M), Quarterly (Q),
Seminannually (S), Annually (A), Note number (N)
 

 

 OPERATIONAL              
 7.  Plumbing and drainage systems 
                   Check for proper operation                    Sanitary
facilities
R
 M                Irrigation, if applicable      R  
   M
         Floor drains   M                Flush floor drain system every spring  
       M          Sump pump    R  M        
             Fire protection         
     M                  system if applicable                    Drain water
system for winter              M    8.  Roofing and Waterproofing              
     Check for leaks                    Roofing      R    M          Joint
sealant in floors      R    M          Expansion joints      R    M    
     Windows, doors and walls       R     M          Floor membrane areas      R
   M          Check for deterioration          R  M    9.  Safety Checks        
           Cargon monoxide monitor, if applicable  R  M                Handrails
and guardrails     R M             Exit lights      R  M            Emergency
lights      R   M            Tripping hazards  R  M            10.  Security
Ssytem                    Check for proper operation  M          P 3           
           AESTHETICS                1.  Signs and graphics              
     Check for proper operation                    In place    R  M        
     Clean        R    M        Legible        R     M        Illuminated  R  M
           2.  Painting                    Check for rust spots        R  M    
     Doors and door frames        R  M          Handrails and guardrails      
 R  M          Pipe guards, exposed pipes and conduits        R  M    
     Other metal        R  M          Check for appearance              
     Striping        R  M          Signs      R  M            Walls        R  M
         Curbs      R    M          Touch up paint      R    M          Repaint
            2 

 
 

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Maintenance task frequency:  Daily (D), Weekly (W), Monthly (M), Quarterly (Q),
Seminannually (S), Annually (A), Note number (N)

 
 

 3.  Landscaping, sidewalks              
     Remove trash
   R
   M
               Planted areas   M                
 
             STRUCTURAL EXAMINATION        
  
     AND EVALUATION                    Concrete deterioration        R    M  P  
     Concrete cracking        R   M  P        Post tension anchors            P
 
             Water leakage and       
                       penetration   R       M    P        Expansion joints    
     R    M  P        Guard rails and wires      R      M  P        Stair tower
structure      R      M  P        Concrete membranes and coatings      R    M  
 

 
                     Notes: 
                      1.  Wash down with power washing equipment is recommended
on a quarterly schedule.  If performed less
                       often, at a mnimum, power washign should be performed in
the spring.  The work may be performed by the
                       onsite employee if trained in equipment operation. 
Otherwise, professional cleaners may be required.
                                    
                       2.  Perform as needed.
 
                      3.  This equipment shouldbe under a service contract for
regular preventative maintenance and emergency
              service.  The equipment manufacturer's recommendations for
inspection and preventive maintenance
                          should  be followed.
 
 
 

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INSURANCE SCHEDULE

 
 

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[Certificate of Liability Insurance (Specimen) has been omitted.]

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Exhibit K
Operating Expenses for the Public Parking Facility Include the Following:

·  
Staffing (Maint./Cleaning/Security/Customer Service)

·  
Utilities (Phone, electric, water, etc.)

·  
Insurance

-Property
-General Liability

·  
Snow/Ice Removal

·  
Maintenance Contracts

·  
Property Maintenance (General damage repair, painting, etc.)

·  
Supplies (Replacement lights, cleaning supplies, bathroom supplies, etc.)

·  
Striping and other painting

·  
Landscaping

·  
Administrative overhead, which shall be limited to $10,000 per year for any year
that DJ has the Maintenance Services Agreement with the City for the Public
Parking Facility or $21,610 per year for all years that DJ does not have such
Maintenance Services Agreement.  Such amounts shall be adjusted annually by the
increase, if any, from the previous year in the Consumer Price Index for all
items for All Urban Consumers-U.S. City Average, published by the U.S.
Department of Labor, Bureau of Labor Statistics.

·  
Security

 
 

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Exhibit L
Par. 12 of the Development Agreement Between the City of Dubuque and The
McGraw-Hill Companies, Inc.

SECTION 12.    PARKING.    City owns the real estate (the Parking Property)
which adjoins the Property shown on Exhibit B and is intended for use for
parking purposes.  In connection therewith, the parties agree as follows:

12.1. Construction of Improvements by McGraw-Hill.  Within the time frames set
forth in Section 10.3, McGraw Hill shall, at its sole expense, complete the
grading, paving, landscaping including islands, and lighting the Parking
Property according to plans and specifications approved by City and consistent
with the City standards including the Port of Dubuque Design Standards.  The
Parking Property shall be divided into Lot A and Lot B as set out on Exhibit
B.  McGraw-Hill shall be responsible for obtaining of all n ecessary permits,
and shall be responsible for and pay for the cost of drainage and storm water
improvements required by City standards and state and federal law for the
development of the Parking Property.  City shall pay only those costs
pre-approved by City for transportation and disposal of fill required to be
removed from the Parking

 
 

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Property as a result of construction by McGraw-Hill of the improvements
contemplated by this Section 12. McGraw-Hill shall use all reasonable efforts in
its design and improvement of the Parking Property to limit the need to remove
fill from the Parking Property. The City shall be provided with prompt notice of
the believed need to remove fill from the Parking Property so as to allow City
to make arrangements for sampling and analysis of such fill, and McGraw-Hill
shall allow such activities by City. City shall not be responsible for bringing
any new fill to the Parking Property. In addition, City shall not be responsible
for transportation and disposal of fill placed on the Parking Property by
McGraw-Hill, its employees, agents or contractors.

12.2. Construction of Improvements by City. City shall install gates and
controls and underground services to those gates and controls to control access
to Lot B, so as to permit the types of uses set out below in this Section 12.4.
The installation of gates and controls and underground services to the gates and
control shall be substantially completed by eighteen (18) months after the
Closing Date. City shall have the right to install, at City's expense and during
the construction of the Parking Lot by McGraw-Hill or at such later date as City
determines, additional electrical service, water, staging, and tie downs.

12.3. Maintenance of Parking Property. Maintenance, repair and replacement of
the Parking Property shall be the sole responsibility and expense of City,
including but not limited to:

Snow removal on Parking Property and adjacent sidewalks completed by 7:00 a.m.
and 3:00 p.m_ each day;

Salting of Parking Property and adjacent sidewalks completed by 7:00 a.m. and
3:00 p.m. each day;

Maintenance of the lawn sprinkler system;

Replacing bushes, trees, etc., as needed;

Lighting maintenance;

Parking lot spring clean-up; and

Monthly parking lot sweeping during non-winter months.

12.4. Use of Parking Lots.

(1)  Lot A shall consist of non-assigned spaces for McGraw-Hill's employees at
no cost to such employees for parking between the hours of 6:00 a.m. and
 
15

 
 

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5:00 p.m. or such later time for a specific day as the City Manager may upon
written request of McGraw-Hill agree, Monday through Sunday, fifty-two weeks per
year: Subject to Section 12.4(3), City shall have the right to allow parking in
Lot A by the public during such hours and at any other time. Notwithstanding the
foregoing, McGraw-Hill employees who have already parked in Lot A prior to 5:00
p.m. may remain parked in Lot A until their workday is completed except on a day
that City has notified McGraw-Hill in writing seven days in advance that
employees may not remain in Lot A after 5:00 p.m. on that day.

(2) Lot B shall consist of non-assigned spaces for McGraw-Hill's employees at no
cost to such employees for parking between the hours of 6:00 a.m. and 5:00 p.m.
or such later time for a specific day as the City Manager may upon written
request of McGraw-Hill agree, Monday through Friday, fifty-two weeks per year,
except holidays. Subject to Section 12.4(3); City shall have the right to allow
parking in Lot B by the public during such hours and at any other time and to
use Lot B at any other time for such purposes as City determines appropriate.
Notwithstanding the foregoing, McGraw-Hill employees who have already parked in
Lot B prior to 5:00 p.m. may remain parked in Lot B until their workday Is
completed except on a day that City has notified McGraw-Hill in writing seven
days in advance that employees may not remain in Lot B after 5:00 p.m. on that
day.

(3) It Is the intent of the parties under Sections 12.4(1) and (2) that all
McGraw-Hill employees will be guaranteed a parking space, but not to exceed the
513 spaces shown on the attached Site Plan, in Lot A or Lot B between the hours
of 6:00 a.m. and 5:00 p.m. Monday through Friday, fifty-two weeks per year,
except holidays, and public parking will be limited by City to effectuate such
guaranteed parking. In order to assure that City makes sufficient parking spaces
available to McGraw-Hill for its employees and to efficiently manage the lot,
McGraw-Hill will notify City upon its Initial occupancy of the office building
of the average number of employees for the month who will work at the office
building between the hours of 6:00 am. and 5:00 p.m. Monday through Friday and
thereafter whenever there is any increase or decrease in the average monthly
number of such employees.

(4) For purposes of this paragraph, holidays shall mean New Years Day, ,
Memorial Day, 4th of July, Labor Day, Thanksgiving and Christmas Day, and the
following Monday when any of the foregoing named legal holidays fall on a
Sunday.

12.5. Parking Facility. If City constructs a parking structure in the Port of
Dubuque north of Third Street, upon completion of the parking structure, all
rights of McGraw-Hill and its employees as provided in Par. 12.4(2) shall
transfer to the parking structure and such parking rights shall be exclusive to
the parking structure. Such structure shall be constructed within 1,200 feet of
the Property.
 
16

 
 
 

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Exhibit M
Escrow Agreement

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ESCROW AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
DIAMOND JO, LLC

This Escrow Agreement, dated October 1, 2007 (Escrow Agreement) is entered into
between Diamond Jo, LLC (DJ) and the City of Dubuque, Iowa (City).

WHEREAS, DJ and City entered into the an Amended and Restated Port of Dubuque
Public Parking Facility Development Agreement dated as of October 1, 2007, (“the
Development Agreement”) whereby DJ agreed to deposit funds with City to be held
in escrow and to be disbursed as provided in the Development Agreement.

NOW, THEREFORE, in consideration of the premises set forth above and other good
and valuable consideration, the receipt of which is hereby acknowledged, the
parties hereto agree as follows:

SECTION 1.                                DEPOSIT OF ESCROW FUNDS.   As provided
in Section 1.2 the Development Agreement, prior to and as a condition of award
by City of the contract for the construction of the Parking Facility (as that
term is defined in the Development Agreement), DJ will deliver to City the sum
of Five Million Four Hundred Thirty-Six Thousand Three Hundred Eighty-Two and
65/100 Dollars ($5,436,382.65) ($6,350,000.00 less such amounts that have
already been paid by DJ to City for the design and construction of the Parking
Facility) (Escrow Funds) to be held by City in accordance with the terms
hereof.  Subject to and in accordance with the terms and conditions hereof, City
agrees that it shall receive, hold in escrow, invest and reinvest and release or
distribute the Escrow Funds.  It is hereby expressly stipulated and agreed that
all interest, dividends and other earnings on the Escrow Funds shall become a
part of the Escrow Funds, and shall be held by City and disbursed as provided in
this Escrow Agreement and by Section 1.2 of the Development Agreement.

SECTION 2.                                INVESTMENT OF ESCROW FUNDS.  City
shall deposit the Escrow Funds received under this Escrow Agreement, including
principal and interest, in a money market fund account at Dubuque Bank & Trust
Co. and shall not move or transfer the Escrow Funds except as provided herein or
unless otherwise agreed upon in writing by DJ.  The parties agree that, for tax
reporting purposes, all interest or other taxable income earned on the Escrow
Funds in any tax year shall be taxable to DJ.  Notwithstanding any provision in
this Escrow Agreement or the Development Agreement to the contrary, all interest
or other amounts accrued or payable on any portion of the Escrow Funds shall be
payable quarterly in cash by Dubuque Bank & Trust Co. to DJ by wire transfer of
immediately available funds no later than fifteen (15) calendar days following
the end of each calendar quarter (or any partial quarter, as applicable) to an
account designated by DJ to Dubuque Bank & Trust Co., commencing with the
quarter ending December 31, 2007.

--------------------------------------------------------------------------------

SECTION 3.                                DISBURSEMENT OR WITHDRAWAL OF ESCROW
FUNDS.

3.1.           City is hereby authorized to make disbursements or withdrawals of
the Escrow Funds as follows:

(a)           In compliance with the terms and provisions of the Development
Agreement; or

(b)  According to written instructions signed by both City and DJ.

 3.2.                      A copy of each withdrawal, including reasonable
documentation thereof, shall be delivered to DJ at the time of withdrawal, but
DJ’s consent shall not be required to any such withdrawal that is in compliance
with the Development Agreement.

SECTION 4.                                NOTICES.  All notices, requests,
demands, and other communications under this Escrow Agreement shall be in
writing and mailed or delivered to the party to whom notice is to be given, by
first class mail, registered or certified, postage prepaid, and properly
addressed, return receipt requested, to the party at the address provided in the
Development Agreement or, to such other address as a party shall designate by
written notice to all other parties to the Escrow Agreement.

SECTION 5.                                TERMINATION OF ESCROW.  This Escrow
Agreement shall terminate and any Escrow Funds, including any accrued interest
or other amounts paid or payable in respect thereof, promptly paid by the City
to DJ upon the earlier to occur of:  (i) the disbursement of all Escrow Funds in
accordance with the terms of this Escrow Agreement and the Development
Agreement; (ii)  termination of the Development Agreement in accordance with its
terms; and (iii) the Termination Date (as defined in the Minimum Assessment
Agreement).

SECTION 6.                                GOVERNING LAW; JURISDICTION.  This
Escrow Agreement shall be construed, performed, and enforced in accordance with,
and governed by, the internal laws of the State of Iowa, without giving effect
to the principles of conflict of laws thereof.

SECTION 7.                                AMENDMENTS; WAIVERS.  This Escrow
Agreement may be amended or modified, and any of the terms, covenants,
representations, warranties, or conditions hereof may be waived, only by a
written instrument executed by the parties hereto, or in the case of a waiver,
by the party waiving compliance.  Any waiver by any party of any conditions, or
of the breach of any provision, term, covenant, representation, or warranty
contained in this Escrow Agreement, in any one or more instances, shall not be
deemed to be nor construed as further or continuing waiver of any such
conditions, or of the breach of any other provision, term, covenant,
representation, or warranty of this Escrow Agreement.

SECTION 8.                                COUNTERPARTS.  This Escrow Agreement
may be executed in two or more counterparts, all of which taken together shall
constitute one instrument.

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SECTION 9.                                ENTIRE AGREEMENT.  This Escrow
Agreement and the Development Agreement contain the entire understanding among
the parties hereto with respect to the escrow contemplated hereby and supersedes
and replaces all prior and contemporaneous agreements and understandings, oral
or written, with regard to such escrow.

SECTION 10.                                SECTION HEADINGS.  The section
headings in this Escrow Agreement are for reference purposes only and shall not
affect the meaning or interpretation of this Escrow Agreement.

SECTION 11.                                SEVERABILITY.  In the event that any
part of this Escrow Agreement is declared by any court or other judicial or
administrative body to be null, void, or unenforceable, said provision shall
survive to the extent it is not so declared, and all of the other provisions of
this Escrow Agreement shall remain in full force and effect.

SECTION 12.  SUCCESSORS AND ASSIGNS.  This Escrow Agreement shall not be
assignable by the Company without the consent of the City and shall not be
assignable by the City without the consent of the Company.  This Escrow
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors and permitted assigns.

 
 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement to be
signed the day and year first above written.

CITY OF DUBUQUE, IOWA

By:   ______________________________                                                             
Roy D. Buol, Mayor

Attest:    ___________________________                                                           
Jeanne F. Schneider, City Clerk

 
 

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DIAMOND JO, LLC

By:        ___________________________                                                        

Its:                                                                

 

 
 

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