Exhibit 10.2


 


DEVELOPMENT AGREEMENT


 


This Development Agreement (this “Agreement”),
dated as of the latest date by the signatures below, which date is September 20,
2010 (the “Effective Date”), is made by and between City of Cape Girardeau,
Missouri, a constitutional charter city and political subdivision of the State
of Missouri under the name City of Cape Girardeau (the “City”) and IOC-Cape
Girardeau LLC, a Missouri limited liability company (the “Developer”).


 


Recitals


 


WHEREAS, the Missouri Gaming Commission (“MGC”) has
announced that it will accept applications for the development of a riverboat
gaming facility and related facilities and potentially prioritize an
application for investigation and evaluation by the MGC, as provided in the
Missouri Code of State Regulations, Title 11, Division 45, Chapter 4, Section 60
(11 CSR 45-4.060) (“Prioritization”) for licensure utilizing the only available
Class B gaming license in Missouri as of July 2010 (the “Last License”).


 


WHEREAS, in order to promote the general welfare
and encourage capital investment and economic development within the City, on
or about April 20, 2010 the City delivered to the MGC a letter of interest
supporting the construction of a riverboat gaming facility and related
facilities in the City.


 


WHEREAS, on or about April 29, 2010 Isle of
Capri Casinos, Inc. (“IOC”) delivered to the MGC a Letter of Interest
expressing interest in the development of a gaming facility.


 


WHEREAS, IOC is a Delaware corporation that is
an experienced builder and operator of riverboat and land-based gaming
facilities, including three such facilities in Missouri.


 


WHEREAS, on July 8, 2010 the Council of the
City held a public meeting during which interested parties, including IOC,
presented conceptual plans for a gaming facility project to be located within
the City.


 


WHEREAS, IOC formed a wholly-owned subsidiary, IOC-Cape
Girardeau LLC, a Missouri limited liability company (the “Developer”) to
undertake and develop the Project.


 


WHEREAS, Developer proposes to submit an
application to the MGC for the development of a riverboat gaming facility and
related facilities (the “Project”) as further described on the attached Exhibit A
(the “Project Description”) and depicted on the attached Exhibit B
(the “Conceptual Plan”) on land within the City situated near the Mississippi
River at approximately River Mile 52.6 as described on the attached Exhibit C
(the “Project Site”).


 


WHEREAS, the City has determined that the Project
is an economic development opportunity for the City, would create jobs and tax
revenue, and the Project would serve the public purposes and interests of the
City and its residents.


 


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Agreement


 


Now, therefore, incorporating the Recitals above, and in consideration of the mutual
promises and benefits contained herein, the City and Developer agree as
follows:


 


1.             Designations.  During the Term of this
Agreement and subject to the conditions herein, as to the Last License:


 


1.1.          Developer.  The City designates the Developer as the only
preferred developer for the development of a gaming facility in the City and
grants to Developer the exclusive right to develop a gaming facility within the
Project Site during the term of this Agreement.


 


1.2.          Site.  The City designates the Project Site as the
only preferred site for the development of a gaming facility in the City and
grants to Developer the right to develop a gaming facility within the Project
Site during the term of this Agreement.


 


1.3.          No Other Preferred Developer or Site.  During the time that Developer is the
preferred developer and the Project Site is the preferred site for a gaming
facility in the City, and prior to the MGC granting Developer all necessary
licenses for operation of the Project, City will not enter into any agreement
with any person or entity other than Developer or regarding any other location
other than the Project Site that would designate or could be construed to
designate the other person or entity as a preferred developer or the other location
as a preferred site for the development of a gaming facility.


 


2.             Term.  The term of this Agreement
shall commence on the Effective Date and continue until the earlier to occur
of: (a) the first (1st) anniversary of the opening of a gaming facility
that has received the Last License in another jurisdiction outside the City;
provided that nothing in this Agreement shall be applied to limit or preclude
the City in any way from designating a preferred developer or taking any other
actions as they may relate to such additional or available license other than
the Last License; or (b) termination by either party pursuant to a right
of termination in this Agreement.


 


3.             Developer
Commitments.  Subject to satisfaction of the Conditions
Precedent as described in Section 4, Developer agrees to take the
following actions (“Developer Commitments”) at Developer’s cost and expense.


 


3.1.          MGC Application.  Developer shall, on or before September 1,
2010 (or by such later date as the MGC may stipulate for submission of
applications for the Last License) submit a substantially complete application
to the MGC for the Last License (as updated in accordance with Missouri gaming
regulations from time to time, the “Application”).  This action is not subject to satisfaction of
the Conditions Precedent.


 


3.2.          Rezoning Application.  No later than six (6) months after
Prioritization, Developer shall file a completed application with the City
requesting rezoning of the Project Site to a Planned Development District “PD
District” (or such other zoning district as Developer and City agree will
accommodate the Project) for the uses set forth 


 


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in the Project Description (“Rezoning”).  Developer shall comply with the City zoning
procedures and other Applicable Requirements (defined in Paragraph 3.3).


 


3.3.          Site Plan Submission.  No later than the later to occur of (a) sixty
(60) days after Prioritization, or (b) sixty (60) days after Rezoning,
Developer shall submit to the City a Preliminary Site Plan for the
Project.  The Preliminary Site Plan shall
be substantially consistent with the Project Description, the Conceptual Plan
and the Application, and shall be in accordance with all applicable federal,
state and City laws, and all applicable City codes, procedures, requirements,
and specifications, including but not limited to applicable City street and
improvement specifications (“Applicable Requirements”).  No later than the later to occur of (a) sixty
(60) days after Prioritization, or (b) sixty (60) days after City approval
of the Preliminary Site Plan, Developer shall submit to the City a Final Site
Plan in accordance with all Applicable Requirements and in conformance with the
approved Preliminary Site Plan and such amendments as approved by the City. The
subdivision, resubdivision, or consolidation of lots and establishment of
public rights-of-way, required for the Project shall be in accordance with the
specifications and requirements of the City Subdivision Code, Chapter 25, and all
other Applicable Requirements.


 


3.4.          Construction Commencement.  No later than the later to occur of (a) sixty
(60) days after Prioritization, or (b) six (6) months after Rezoning,
or (c) six (6) months after Final Site Plan approval, Developer shall
submit completed applications for construction approvals and permits for the
first phase of construction.  Developer
can elect to submit applications in a phased manner as is normal and customary
for phased projects, with the first phase being at a minimum site, footings and
foundation.  No later than six (6) months
after receiving approvals and permits for footings and foundation, Developer
will submit completed applications for the core and shell of the casino
building and for parking.  Submissions
shall be as provided for and in compliance with all Applicable
Requirements.  Developer shall commence
construction of the Project (“Construction Commencement”) no later than the
later to occur of (a) sixty (60) days after Prioritization, or (b) ninety
(90) days after receipt of all required construction approvals and construction
permits, including floating casino floor approval from the American Bureau of
Shipping.


 


3.5.          Demolition Prior to Construction Commencement.  Developer shall be responsible
for demolishing and removing all above-ground structures within the Project
Site not necessary for the Project, subject to compliance with all Applicable
Requirements related to such demolition and removal.  Developer may remove or leave in place
below-ground structures, subject to compliance with all Applicable Requirements
relating thereto.  In Developer’s sole
discretion, demolition and removal may occur prior to Construction Commencement
and shall not constitute Construction Commencement.


 


3.6.          Parcel Acquisition.


 


3.6.1.       Project Site.  The parcels and area that constitute the
Project Site are shown on Exhibit C. 
Developer represents that Developer currently owns or 


 


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has under contract with the right to
purchase a majority of the parcels that constitute the Project Site.  Developer shall make reasonable and good
faith efforts to acquire fee ownership of all the parcels set forth on Exhibit C
within six (6) months after Prioritization.


 


3.6.2.       Areas for Public Infrastructure Improvements.  The parcels or portions of
parcels that constitute areas for public infrastructure improvements are shown
on Exhibit D.  Developer shall make
reasonable and good faith efforts to acquire fee simple ownership of the
parcels or portions of parcels set forth on Exhibit D within six (6) months
after Prioritization.  To the extent that
plans approved by the City necessitate acquisition of additional or different
parcels or property interests, Developer and the City agree that Exhibit D
shall be amended to include such necessary parcels and property interests.


 


3.7.          Financing.  Developer shall pursue financing for the
Project reasonably acceptable to Developer. 
No public financing or abatement of taxes of any kind is authorized by
this Agreement.


 


3.8.          Public Infrastructure Improvements.


 


3.8.1.       Street Improvements.  Street improvements that constitute public
infrastructure improvements (the “Street Improvements”) include: (a) realignment
and improvements to Main Street and Chestnut Street in accordance with the
Conceptual Plan and as approved on a Final Site Plan in accordance with all
Applicable Requirements (such realignment and improvements are collectively
referred to as the “Main and Chestnut Improvements”); and (b) roadway
improvements, relocation of overhead utilities, and streetscape improvements,
landscaping and decorative lighting consistent with the current Downtown
Business District, all along Main Street from Broadway to Mill, as reasonably
agreed upon by the City and Developer. 
Developer shall have the right but not the obligation to request each of
the improvements in (b).  Unless
otherwise provided pursuant to the Infrastructure Fund described in Paragraph
3.8.3, Developer shall construct and pay all costs relating to the Street
Improvements, including but not limited to all acquisition of rights-of-way,
construction, legal, engineering, surveying, and other costs.  Construction of the Main and Chestnut
Improvements shall be subject to such City conditions and requirements as are
necessary to maintain safe and efficient traffic flow and emergency access at
all times and shall be completed and qualified for acceptance by the City prior
to the commencement of gaming activities on the Project Site or occupancy of
any building within the Project Site.


 


3.8.2.       Construction of Utilities.  Unless otherwise provided pursuant to the
Infrastructure Fund described in Paragraph 3.8.3, Developer shall construct and
pay all costs relating to location, relocation and construction of Off-Site Utility
Improvements.  “Off-Site Utility
Improvements” shall include stormwater and sanitary sewer mains, sewage lift
stations and water lines required for service to the Project to the boundary of
the Project Site in conformance with all Applicable 


 


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Requirements and final improvements plans
approved by the City.  In addition,
Developer at its cost shall be responsible for the location, relocation and
construction for all other utilities to the Project Site and for all utilities
on the Project Site, unless otherwise specifically provided pursuant to the
Infrastructure Fund described in Paragraph 3.8.3.


 


3.8.3.       Infrastructure Fund.  The City and Developer shall negotiate in
good faith to consider establishment of a fund (the “Infrastructure Fund”) to
provide an alternative mechanism to pay the costs of the Street Improvements
and the Off-Site Utility Improvements and such other public improvement costs
and other lawfully included costs as may be agreed including acquisition of
property for public improvements (with fund establishment and financing costs,
the “Infrastructure Costs”).  Unless
otherwise agreed, a funding agreement between the City and Developer may
provide that: (a) the City and not Developer shall construct and pay all
costs relating to the Street Improvements and the Off-Site Utility Improvements
in accordance with all Applicable Requirements; (b) Developer shall
reimburse the City for the Infrastructure Costs by paying to the City one-half
of one percent (0.5%) of Developer’s gross gaming revenue from the Project
annually until the City is reimbursed in full for the Infrastructure Costs plus
interest and other costs as agreed; (c) when or before establishment of
the Infrastructure Fund, Developer’s parent company, Isle of Capri Casinos, Inc.,
shall deliver to City an acceptable binding and enforceable writing or other
mechanism that guarantees Developer’s payment of the Infrastructure Costs.


 


3.9.          Traffic Study.  Developer has commissioned at Developer’s
cost and expense a traffic study (“Developer’s Traffic Study”) to comply with
the requirements of the MGC and the City and to identify traffic impacts of the
Project considering impacts up to ten (10) years from the anticipated date
of Construction Commencement based upon the Project Description and the
Conceptual Plan and any updated submissions or approvals.  Developer shall promptly make Developer’s
Traffic Study available to the City.  The
City will accept the results of Developer’s Traffic Study unless the City
reasonably determines that Developer’s Traffic Study contains material errors
or omissions.  If the City reasonably
determines that Developer’s Traffic Study contains material errors or omissions
or does not comply with Applicable Requirements, the City may but is not
obligated to (a) require Developer to update Developer’s Traffic Study, or
(b) commission its own traffic study, to address the material errors or
omissions or compliance with Additional Requirements (the “City’s Traffic Study”)
and Developer shall pay the cost of the City’s Traffic Study.  If the Developer’s Traffic Study or the City’s
Traffic Study recommends improvements or alterations necessary to address
legitimate public safety concerns or to prevent material diminishment in the
service level in existence prior to Construction Commencement, Developer shall
be obligated to pay for or construct such improvements or alterations as
directed by the City in conformance with all Applicable Requirements.  Such improvements or alterations may be
included in the Infrastructure Fund, if established.


 


3.10.        Taxes.  Developer shall pay all taxes assessed
against the Project pursuant to applicable law, including but not limited to
gaming taxes, sales taxes, business license 


 


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taxes, and personal property and real estate
taxes.  Developer reserves the right to
appeal, contest, object to or litigate any new tax or increase in tax rate that
is enacted after the Effective Date, or any property tax assessment imposed
after the Effective Date, pursuant to applicable law.


 


3.11.        Administrative Reimbursement Fee.  Within three (3) business days after the
Effective Date, Developer shall pay to the City a non-refundable fee of One
Hundred Fifty Thousand Dollars ($150,000) to reimburse and compensate the City
for the City’s time, expense and resources committed to the review, negotiation
and analysis of this Agreement, Developer’s proposal, the designation of
Developer as the preferred developer as effected herein, and submissions by the
City to the MGC, through September 30, 2010.  Nothing in this Agreement shall be deemed to
waive any tax, license, permit fee, user charge, or generally applicable
obligation otherwise lawfully imposed by the City.  Payment of this fee is not subject to
satisfaction of the Conditions Precedent.


 


3.12.        Other Payments from Developer.


 


3.12.1.     Partial
Consideration Payment.  In partial consideration of the actions and
Commitments of City, including the transfer of approximately eleven (11) acres
of City property and public rights-of-way as described in Paragraph 5.4 and Exhibit E,
Developer shall pay to City no later than City’s transfer of title to the City
property described in Paragraph 5.4 and Exhibit E Two Million Dollars
($2,000,000) to be used by the City as follows: (1) up to One Million
Dollars ($1,000,000) shall be used by the City for costs relating to
improvements to Broadway Street; and (2) the remainder shall be used by
the City for other public improvements or other expenditures having a public
purpose.


 


3.12.2.     Riverfront
Region Economic Development Fund.  Developer shall pay monthly three-tenths of
one percent (0.3%) of Developer’s gross gaming revenue from the Project to the
City to be held in a special fund (the “Riverfront Region Economic Development
Fund”) (the “Riverfront Fund”) for improvements, economic development and other
public purposes benefiting the downtown commercial and riverfront areas of the
City, including but not limited to the area between the Downtown Business
District and the Project Site.  The City
may draw on and expend the funds from the Riverfront Fund directly or may
contract with Old Town Cape, Inc., a Missouri non-profit corporation or
other non-profit organizations agreeing to expend the funds for such specified
public purposes.  At least 70% of the
expenditures from the Riverfront Fund shall go towards capital improvements
(including planning, design, implementation, and construction).  Developer’s monthly payment to the Riverfront
Fund required under this paragraph shall be required only for such months that
the City funds, or makes a binding commitment to fund, an equal payment to be
deposited in the Riverfront Fund. 
Notwithstanding any requirement herein to the contrary, in lieu of
Developer’s first Two Hundred Fifty Thousand Dollars ($250,000) in payments to
the Riverfront Fund, Developer shall pay to the City on or before Construction
Commencement the amount of Two Hundred Fifty Thousand 


 


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Dollars ($250,000) which shall be used by
the City for wayfinding signage costs as provided for in Paragraph 5.3.4, with
any remainder, if any, being deposited in the Riverfront Fund.  That prefunded amount of $250,000 represents
0.3% of Developer’s gross gaming revenue from the Project of $83,333,333.  After Developer’s gross gaming revenue from
the Project exceeds $83,333,333, Developer will begin to make the monthly
payments to the Riverfront Fund.  City
may, but shall not be obligated to, match into the Riverfront Fund for the
first $250,000 payment.  If the Project
Site becomes part of a Community Improvement District then Developer can elect
to terminate Developer’s payment obligation pursuant to this paragraph upon
written notice to the City for the period of time that the Project Site is part
of the Community Improvement District.


 


3.12.3.     Community
Improvement District.  If a Community Improvement District (“CID”)
that includes all or a majority of the area of Special Business District No. 2
of the City of Cape Girardeau is established pursuant to Sections 67.1401 to
67.1571 RSMo, as amended, and the CID does not include the Project Site, then
during the term of the CID, Developer shall make monthly to the City
supplemental cash payments in an amount equal to:  (1) the revenues in each such month of
the Project that would be subject to the CID sales tax if the Project was
included within the CID, multiplied by (2) a percentage equal to the sales
tax rate levied by the CID up to a maximum rate of one percent (1.0%).  Each such supplemental payment shall be made
contemporaneous with payments of monthly sales tax receipts due to the State of
Missouri Department of Revenue.  City
shall deposit the monthly supplemental payment into the Riverfront Fund for
uses authorized for the Riverfront Fund but such deposit shall not constitute
the City’s funding to the Riverfront Fund described in Paragraph 3.12.2.  The parties hereby agree that Developer’s
obligation to make the monthly supplemental payments shall constitute a lien on
the Project in favor of the City.


 


3.13.        Dedication of Property.  Developer shall dedicate and transfer to the
City all property required for the Main and Chestnut Improvements and all
public streets and easements approved on the Final Site Plan, including the
properties and property interests shown on Exhibit D, by subdivision plat
and by special warranty deed with title insurance if any requested by City paid
by Developer or by general warranty deed, at such time as required by the City
after Developer completion of all required improvements thereon in conformance
with Applicable Requirements, which time shall be prior to the commencement of
gaming activities on the Project Site; provided that the City may authorize a
delay in completion of one or more transfers and completion of improvements
therein if such delay does not threaten public safety or place the public
interest at risk.  The form of such
transfer and deed shall be as reasonably approved by the City.


 


3.14.        Cooperation.  Developer shall cooperate with City in all
respects to ensure that the City can timely meet its Commitments and fully
obtain all benefits intended by this Agreement.


 


3.15.        Subject to Change.  Developer Commitments, including the
commitment to pursue the development of the Project, are subject to change due
to the Conditions 


 


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Precedent described below and to “force
majeure” events beyond Developer’s reasonable control precluding satisfaction
of the Commitments including: (a) labor disputes, fire, unusual delays in
transportation or supplies, adverse weather conditions not reasonably
anticipated, site conditions not reasonably anticipated, and unavoidable
casualties or other acts of God; and (b) change or imposition of law
making satisfaction of the Commitments impossible or unlawful.


 


3.16.        Development Generally.  Developer shall diligently pursue in good
faith the development of the Project in general accordance with this Agreement,
the information presented as part of the Application and the Project
Description.  Developer shall further
diligently pursue in good faith the satisfaction of the Conditions
Precedent.  Nothing in this subparagraph
shall preclude Developer from exercising its rights of termination as provided
in this Agreement.


 


4.             Conditions
Precedent.  Development of the Project requires
satisfaction of the conditions set forth below (“Conditions Precedent,” each a “Condition
Precedent”).  The Conditions Precedent
are precedent to commencement of construction of the Project (“Construction
Commencement”) or precedent to continuation of construction of the Project
after commencement of construction (“Continuation”).  Developer may, in its sole and absolute
discretion, waive satisfaction of any Condition Precedent but such waiver must
be in writing signed by Developer.  If a
Condition Precedent is not satisfied in a timeframe reasonable to Developer,
Developer may, in its sole and absolute discretion, notify the City that the
Conditions Precedent have not been satisfied and this Agreement shall terminate
and become null and void and Developer and the City shall have no further
obligations to each other under this Agreement. 
Nothwithstanding anything in this Agreement to the contrary, upon issuance
of the Class B License from the MGC, all Conditions Precedent shall be
deemed to have been satisfied or waived by Developer.


 


4.1.          Gaming Commission Approval.  As a Condition Precedent to Construction
Commencement, the MGC selects Developer and the Project for
Prioritization.  As a Condition Precedent
to Continuation, the MGC grants Developer all necessary licenses including but
not limited to Key Person and Level I.


 


4.2.          Other Governmental Approvals.  As a Condition Precedent to Construction
Commencement or to Continuation, as the case may be, Developer obtains or is
able to obtain all other governmental approvals and permits and all other
official and necessary approvals and permits.


 


4.3.          Voter Approval.  As a Condition Precedent to Construction Commencement,
a majority of the voters of the City voting in the November 2, 2010
election must approve the question that will appear on the ballot asking the
voters to allow the licensing of excursion gambling boats or floating
facilities in the City.  In the event a
majority of the voters of the City voting in the election fail to approve the
question, Developer may terminate this Agreement and abandon the Project.  In addition, as a Condition Precedent to
Continuation, if any future ballot measure, not in effect as of the Effective
Date, is certified for election and such ballot measure jeopardizes Developer’s
ability to construct and operate the Project, as determined by Developer in 


 


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Developer’s sole and absolute discretion,
Developer may terminate this Agreement and abandon the Project.


 


4.4.          Acquisition of Property within the Project Site.  As a Condition Precedent to
Construction Commencement, Developer or a related entity obtains fee simple
ownership of all real property (including but not limited to all options held
by third parties, fee interests, leasehold interests, tenant-in-common
interests, easement rights and such other like or similar interests, both
public and private) and existing improvements on the Project Site, excluding
new public rights-of-way necessary for the implementation of the Project,
subject only to easements, conditions and restrictions acceptable to Developer.


 


4.5.          Inspections.  As a Condition Precedent to Construction
Commencement, Developer in its sole and absolute discretion is satisfied with
the results of Developer’s examination and inspection of the Project Site,
including public land and rights-of-way within the Project Site (collectively,
the “Inspections”).  The Inspections may
include, without limitation, title, survey, environmental assessments, soil
studies, historical, archeological, cultural, architectural, mechanical and
engineering studies, and any inspections required by any governmental agency.  Developer and Developer’s representatives,
agents and contractors, at Developer’s sole cost and expense, may examine and
inspect the Project Site, including public land and rights-of-way within the
Project Site, and may disturb the Project Site, including drilling for samples,
in conjunction with the Inspections.  If
this Agreement is terminated, Developer shall return all areas of the Project
Site disturbed by Inspections to substantially the same condition existing
prior to such disturbance.


 


4.6.          Levee.  As a Condition Precedent to Construction
Commencement, the North Main Street Levee and the Main Street Levee (the “Levee
System”) must: (a) be certified by a qualified independent third party
inspector; (b) meet all the design and maintenance requirements of the
U.S. Army Corps of Engineers for a 500 year levee; (c) enable Developer to
obtain flood insurance at rates acceptable to Developer; and (d) be
otherwise acceptable to Developer’s lenders and insurers for issuance of
financing.


 


4.7.          Absence of Material Adverse Change.  As a Condition Precedent to Construction
Commencement and to Continuation, no Material Adverse Change has occurred.  For purposes of this Agreement, “Material
Adverse Change” means any event, change, development, or occurrence that,
individually or together with any other event, change, development, or
occurrence, is materially adverse to Developer’s business, condition (financial
or otherwise), assets or operations, or to the Project, and shall include, but
not be limited to: (a) any event or economic condition that causes the
Project to no longer be economically viable or financeable; (b) economic
or credit conditions that result in substantial financial costs to Developer
that are not anticipated by Developer as of the Effective Date; or (c) costs associated with Developer’s acquisition of
private land, public land or rights—of-way, or costs to be reimbursed by
Developer to the City pursuant to this Agreement, or hidden defects and/or
substantial requirements for on-site or off-site improvements, that in
Developer’s sole and absolute discretion make the Project no longer
economically feasible.


 


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4.8.          No Legislative Changes.  As a Condition Precedent to Construction
Commencement and to Continuation, there is no significant new legislative or
regulatory change which would make materially more burdensome or costly the
obligations of Developer related to the Project or which make the Project no longer economically feasible.


 


4.9.          No Litigation.  As a Condition Precedent to Construction
Commencement and to Continuation, no legal action, including but not limited to
court litigation or administrative process, is initiated or pending, including
without limitation action against Developer, the City, the MGC or the State of
Missouri, or any political subdivision of the State of Missouri, challenging
the validity or seeking to enjoin the performance of, or otherwise arising out
of the subject matter of, this Agreement or any provision of this Agreement.


 


4.10.        Utilities.  As a Condition Precedent to Construction
Commencement:


 


4.10.1.     Construction
and relocation of all utilities necessary for service to the Project shall be
economically feasible as determined by Developer, including without limitation,
removal or removal and relocation of all City owned utilities in the Project
Site at Developer cost and vacation or vacation and relocation of all City
utility easements that affect the Project Site at Developer cost.


 


4.10.2.     All
utilities to the Project Site, including electricity, gas, water, sanitary
sewer, storm sewer, cable and telecommunications, shall be available, in
sufficient capacity to supply the Project as reasonably determined by
Developer, and at Developer cost, which cost shall be economically feasible as
determined by Developer.


 


4.11.        Zoning.  As a Condition Precedent to Construction
Commencement:


 


4.11.1.     Zoning
shall have been amended to re-zone the Project Site as provided in the rezoning
application submitted by Developer in accordance with Paragraph 3.2.


 


4.11.2.     City
has upon re-zoning acknowledged that the Project Site is properly zoned to
allow the construction and operation of the Project and for gaming activities.


 


4.12.        City Commitments.  As a Condition Precedent to Construction
Commencement or to Continuation, as the case may be, the City has fulfilled the
City Commitments or has obtained definitive agreements to accomplish the City
Commitments.


 


5.             City
Commitments.  The City agrees to take the following actions
and complete each of the following actions by June 30, 2011 or demonstrate
substantial progress towards completing such actions by June 30, 2011,
unless a different date is identified or implied in this Agreement for the
action.  Any reasonable costs incurred by
the City from and after October 1, 2010 in fulfilling the City
Commitments, except for costs of City staff time and except as may


 


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otherwise provided in this Section 5, shall be
the responsibility of Developer which shall be paid by Developer to City within
thirty (30) days of receipt of invoice accompanied by reasonably documented
evidence of such costs.


 


5.1.          Zoning.  City shall take all necessary action to
promptly process to a final decision the rezoning application submitted by
Developer pursuant to Section 3.2, subject to all Applicable Requirements,
and including necessary action for initiating zoning and final action zoning any
public rights-of-way within the Project Site as described in Section 5.3.1
and requested in the rezoning application. 
Final legislative action on a completed zoning application submitted
pursuant to Paragraph 3.2 shall be taken not later than six (6) months
after submission of a completed application, unless otherwise mutually agreed
by Developer and City.


 


5.2.          Signage.  Signage shall be as approved on the Final
Site Plan.  If variances are sought for
signage, such variances shall be requested in the zoning application, or as may
otherwise be pursued as permitted by Applicable Requirements.  Developer’s signage on the Project Site shall
comply with all Applicable Requirements. 
The City agrees that the zoning approval shall not control the content
of the words or images of such signage, except as may be governed by the
Applicable Requirements.


 


5.3.          Streets and Traffic.


 


5.3.1.       Vacation.  City shall vacate all public streets, alleys,
roadways, driveways and sidewalks in the Project Site as and when reasonably
requested by Developer after the Conditions Precedent have been satisfied and
as approved on the Final Site Plan.


 


5.3.2.       Parking Prohibition.  City, upon issuance of a Class B License
from the MGC for the Project Site, shall enact an ordinance to eliminate
on-street public parking on Main Street and Chestnut Street between Broadway
and the northern boundary of the Project Site where Chestnut Street crosses the
levee.  The City shall also prohibit such
parking during construction of the Project.


 


5.3.3.       Dedication.  City shall accept public dedication of all
property as provided for in Paragraph 3.14.


 


5.3.4.       Wayfinding Signage.  City shall cooperate with Developer to
develop comprehensive signage plans, based on the Cape Girardeau Wayfinding
Design Documents and Master Plan dated June 21, 2010 to establish
wayfinding signage providing adequate directions to the Project.  The City shall request that the State of
Missouri Department of Transportation install an adequate number of directional
signs related to the Project on the highways and state-controlled roads leading
to the City and the City shall use its reasonable efforts to obtain approval of
such requests.  City shall pay the costs
of all wayfinding signage from the Two Hundred Fifty Thousand Dollars
($250,000) paid by Developer to City pursuant to Paragraph 3.12.2 and not to
exceed that amount, and City shall use its 


 


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reasonable efforts to seek grant monies that
are available for such signage packages.


 


5.4.          Property.  City shall convey all of its property right,
title and interest in the properties shown on Exhibit E to
Developer at such time as Developer makes the payment to the City set forth in Section 3.12.1
on such closing date as is mutually agreeable by City and Developer, but in no
event later than sixty (60) days after Prioritization of Developer occurs.  After transfer, and until the Main and
Chestnut Improvements are completed and dedicated to the City, Developer shall
provide binding accommodation for alternative emergency access and other
necessary traffic routing as my be reasonably required by the City due to the
transfer from public ownership of the properties shown on Exhibit E.


 


5.5.          Rights-of-Way Acquisition; Condemnation.  Developer shall make reasonable and good
faith efforts to acquire for the City any property or any interest in property
necessary for public infrastructure improvements including as set forth on Exhibit D
and as described in the Conceptual Plan and finalized on final improvement
plans approved by the City, including without limitation, any tenant’s or
lessee’s interest in any lease affecting all or a portion of such
property.  The City shall control the
form of deed of any acquisition.  If
Developer is unable to acquire any such property through good faith and
reasonable efforts, Developer shall notify the City, in writing, that the City
should undertake negotiations to acquire the property as prescribed by Chapter
523 RSMo and other Applicable Requirements, and if unable to acquire the
property by such means, then to initiate eminent domain proceedings to acquire
such property or interest in the property. 
Subject to satisfaction of all Applicable Requirements, the City shall
initiate such proceedings within fifteen (15) business days after such
notification and subject to compliance with all Applicable Requirements for
such condemnation.  Developer shall
reimburse the City for all costs and expenses of the acquisition of the
property and for all legal expenses involved in the acquisition, including but
not limited to the negotiated price, settlement or the condemnation award
relating to any and all such parcels, and any judgment thereafter, interest,
taxes to be paid at the time of acquisition, court costs, filing fees, title
work fees, appraisal fees, environmental inspection fees, investigation or
engineering of alternative locations, relocation assistance costs, abandonment
costs, legal fees, publication costs, and all administrative and other expenses
incurred in connection with the acquisition of the parcels.  Prior to commencement of condemnation
proceedings, the City may require Developer to deposit funds with the City, in
amounts reasonably estimated by the City to address anticipated total or
incremental costs, and to be held by the City and drawn upon by the City for
reimbursement under this Paragraph.  Any
such deposited funds not expended pursuant to this Paragraph shall be returned
to Developer.  Under no circumstances
shall this section be construed to authorize or require City condemnation of
any parcel solely for economic development purposes as defined in Section 523.271.2
RSMo.


 


5.6.          Business License.  City represents, warrants and covenants that
the City’s business license tax does not apply to gross receipts of gaming
revenues from the Project.


 


5.7.          Support and Cooperation.  The City shall:


 


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5.7.1.       Communicate
the City’s support for the Developer and the Project as the preferred developer
and the preferred gaming facility to the MGC and other governmental entities
and agencies and to groups and individuals and in public or private forums, all
as reasonably requested by Developer.


 


5.7.2.       In
a timely fashion act on all completed applications for permits and approvals
from the City that are required for the Project to facilitate completion of the
Project in the timeframes set forth in Developer’s Application to the MGC, and
as the Application may be amended from time to time, including without limitation
timely review of the Preliminary and Final Site Plans, and the City shall take
final action consistent with Applicable Requirements.


 


5.7.3.       Cooperate
in good faith with Developer.


 


5.7.4.       Promptly
respond to any requests or notices received by the City from Developer.


 


5.7.5.       Consider
in good faith any request for any variation from or amendment to the terms of
this Agreement or documents produced in connection with this Agreement that may
be reasonably necessary to complete the Project.


 


6.             Changes.  Nothing herein
shall preclude Developer from making changes
to the Project, subject to all Applicable Requirements, as may be necessary or
desirable to the Developer, to enhance the economic viability of the Project or
otherwise, so long as such changes do not materially change the Project as a
gaming facility and related uses nor materially deviate from the information
contained in the Application to the MGC and the Project Description.


 


7.             Assignment.  Developer may transfer, assign
or change ownership of this Agreement or Developer’s interest in and to some or
all of the Project Site (each, a “Transfer”) without the prior written consent
of the City to: (a) a majority-controlled subsidiary or parent entity; (b) any
entity it controls, is controlled by, or is under common control with; (c) any
entity in which it has a majority interest or of which it is manager; or (d) any
entity upon a reasonable demonstration by Developer of the proposed transferee’s
or assignee’s experience and financial and legal capability to undertake and
complete the Project and perform Developer’s obligations under this Agreement
(each, a “Permitted Transferee”); provided that any  the recipient of any Transfer first delivers
to the City a binding and enforceable writing that assumes and agrees to
perform all of the obligations of Developer as developer under and pursuant to
this Agreement as of the date the Transfer. 
All other Transfers shall require prior written consent of the City, not
to be unreasonably withheld.  Developer shall
promptly provide the City prior notice of such Transfer.  Developer shall be relieved of any
obligations under this Agreement arising after a Transfer to a Permitted
Transferee, provided that Developer is not in default of any obligation
herein.  Permitted Transferee, however,
shall be fully subject to the terms of this Agreement as the Developer.  Developer may collaterally assign its
interest in this Agreement or the Project Site as security to a reputable lender
without the prior written consent of the City. 
The City may not transfer, assign or change ownership of this
Agreement.  During any time Developer
holds a Class B license for the Project, no consent of the City is
required for a Transfer, provided: (a)


 


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Developer may not transfer, assign or change
ownership of this Agreement without the prior consent of the MGC; (b) Developer
may not transfer, assign or change ownership of Developer’s interest in and to
some or all of the Project Site without the prior consent of the MGC; and (c) Developer
shall provide the City notice of any proposed transfer, assignment or change of
ownership prior to Developer provides notice of such to the MGC; and (d) the
recipient of any Transfer first delivers to the City a binding and enforceable
writing that assumes and agrees to perform all of the obligations of Developer
as developer under and pursuant to this Agreement as of the date the Transfer.


 


8.             Insurance.  Developer will cause there to be insurance as
hereinafter set forth at all times
during the process of constructing
the Project and, from time to time at the request of the City, furnish the City
with proof of payment of premiums on:


 


8.1.          Commercial general liability insurance (including
premises operations, independent contractors, operations of subcontractors,
completed operations and contractual liability insurance) together with an owner’s and
contractor’s policy, with limits against bodily injury and property damage of
not less than Three Million Dollars ($3,000,000) for each occurrence (to
accomplish the above required limits, an umbrella excess liability policy may
be used).  This policy shall be written
on ISO occurrence form CG 00 01 96 (or substitute form providing equivalent
coverage) and shall name the City as an additional insured for coverage of not
less than the sovereign immunity limits as set forth in §537.610 R.S.Mo. with
proof of such being delivered to the City and providing for notice to the City
at least thirty (30) days prior to any cancellation; and


 


8.2.          Workers’
Compensation insurance, with statutorily required coverage, and all other
insurance as may be required by law.


 


9.             Damage,
Destruction, Condemnation or Eminent Domain.


 


9.1.          If all or any material part of the Project or the Project Site is
damaged, destroyed or taken by condemnation or power of eminent domain,
excluding such condemnation as contemplated by Paragraph 5.5, Developer shall
notify the City and, at Developer’s choice, either (a) cease the use of
the property as a gaming facility and this Agreement shall terminate and be
null and void and Developer and the City shall have no further obligations to
each other under this Agreement, or (b) Developer shall continue with the
Project.


 


9.2.          If less than a material part of the Project or the Project Site is
damaged, destroyed or taken by condemnation or power of eminent domain,
Developer shall notify the City, this Agreement shall continue in full force
and effect, and Developer shall continue with the Project.


 


9.3.          For purposes of this Section 9, “material part of the Project or
the Project Site” is defined as a part that substantially impairs Developer’s
access to or intended use of the Project or the Project Site.


 


10.           Compliance.  Developer and the City will
comply with all applicable federal, state and local laws, rules, regulations
and ordinances, including but not limited to state statutes and 


 


14

















 


regulations pertaining to gaming.  Developer shall as a condition of this Agreement
provide such certification and documentation as may be required by state or
federal law, including regarding immigration compliance, in such time frames as
may be required by state or federal law or reasonably required by the City for
execution, validation or enforcement of this Agreement.


 


11.           Indemnification.  Developer hereby covenants,
warrants and agrees to indemnify and save the City and its respective
officials, officers, agents, attorneys, employees and representatives  harmless from and defend against (with legal
counsel selected by the City and reasonably acceptable to Developer) all
claims, demands, costs, liabilities, damages or expenses, including attorneys’
fees, by or on behalf of any person, firm or corporation arising from: (1) the
conduct or management of, or from any work, actions or omissions of Developer
relating to the Project; or (2) any condemnation, acquisition or transfer
of land under this Agreement, including, but not limited to, any environmental
condition or use of such land; or (3) from any action or inaction of City
pursuant to this Agreement or any breach or default of this Agreement by
Developer; or (4) any claim, demand, dispute or litigation by any third
party relating to this Agreement or the Project, or any actions taken relating
thereto by City pursuant to the terms of this Agreement, including, but not
limited to, any lawsuit related to the election referenced in Paragraph 4.3, or
relating to any City approval, ordinance or action taken in furtherance of or
under obligation of this Agreement.  The
foregoing indemnification obligations shall survive termination of this
Agreement for any reason.


 


12.           Public Liability Limited.  The parties hereto agree that neither the
City nor any of its respective officials, officers, agents, attorneys,
employees, or representatives shall have any liability in damages or any other
monetary liability to Developer or any affiliate, or successor, assign, heir or
personal representative in respect of any suit, claim, or cause of action
arising out of this Agreement or the commitments contemplated herein.  No official, officer, agent, attorney,
employee, or representative of the City shall be personally liable to Developer
or any affiliate, or successor, assign, heir or personal representative arising
from any default or breach by any party under this Agreement or any commitments
contemplated herein.


 


13.           Notices.  Notices or other communications
which are required or may be given under this Agreement shall be in writing,
delivered personally or by courier service or by certified mail to the address
indicated for each party, or to such other address as designated by a party by
notice to the other party.  The date of
notice shall be the date of delivery or refusal of delivery.


 


14.           Time
of the Essence.  Time is of the essence in the performance of
all obligations under this Agreement. 
Nevertheless, if a deadline or day for performance is a Saturday, Sunday
or legal holiday, the deadline or day for performance will be the next business
day.


 


15.           Entire
Agreement.  As of the Effective Date, this Agreement
constitutes the entire agreement between the City and Developer regarding
development of the Project and there are no other covenants, agreements,
promises, terms or provisions, either oral or written, between them concerning
the Project other than those set forth in this Agreement.


 


16.           Binding
Benefit. 
This Agreement is binding upon and shall inure to the benefit of the
parties hereto, and their successors, heirs, personal representatives and
permitted assigns.


 


15

















 


17.           No
Police Power Limitation.  Nothing in this Agreement shall be construed
to surrender or waive the City’s police powers or to contract away any of its
governmental functions or authority. 
This Agreement shall be interpreted in light of inherent limitations
placed upon the City as a municipal corporation which requires it to retain
such police powers to protect the health, welfare and safety of the
public.  Furthermore, nothing in this
Agreement shall be interpreted to contradict any federal or state law.


 


18.           Opportunity
to Cure.  In
the event either party fails to timely satisfy a Commitment or breaches an
obligation herein, or prior any party exercising a right of termination of this
Agreement for any reason, such party shall have a period of thirty (30) days
from receipt of written notice of such failure or breach, or intent to
terminate, to cure such default or termination basis before termination or a
remedy for default may be invoked.  Where
the basis for termination or default is not cured within the thirty (30) day
period, the party declaring the default or termination may elect to accept a
legally binding commitment to cure in its sole discretion.


 


19.           Enforcement by City.  In the event that Developer fails to make a
monetary payment required by this Agreement or otherwise fails to comply with
any material term herein, the City may, in addition to any other remedies
available at law or in equity, withhold permits and approvals for the Project
until such compliance is secured and shall be entitled to any costs of
enforcement of this Agreement, including reasonable attorneys fees, in the event that Developer is determined
judicially to have violated the terms of this Agreement.  Nothing herein shall preclude the Developer
from contesting the existence City’s determination of Developer’s
noncompliance, including as may be the basis for such withholding of permits or
approvals for the Project.


 


20.           Conflict of Interest.  No member of the City Council who has any power of review or approval of
any of Developer’s undertakings, or of Developer’s contracting for goods or
services for the Project Site, shall participate in any decisions relating
thereto which affect that member’s personal interests or the interests of any
corporation or partnership in which that member is directly or indirectly
interested.  Any person having such
interest shall immediately, upon knowledge of such possible conflict, disclose,
in writing, to the City Council the nature of such interest and seek a
determination by the City Council with respect to such interest and, in the
meantime, shall not participate in any actions or discussions relating to the
activities herein proscribed.


 


21.           Representations of Developer.  Developer
hereby represents and warrants that it has full and lawful right, power and
authority, under current applicable law, to execute, deliver and perform the
terms and obligations of this Agreement and all of the foregoing have been or
will be, duly and validly authorized and approved by all necessary Developer
proceedings, findings and actions. 
Accordingly, this Agreement constitutes the legal, valid and binding
obligation of the Developer, enforceable in accordance with its terms.


 


22.           Representations of the City.  The City
hereby represents and warrants that it has full constitutional and lawful
right, power and authority, under current applicable law, to execute, deliver
and perform the terms and obligations of this Agreement and all of the
foregoing have been or will be, upon adoption of ordinances authorizing this
Agreement, duly and validly 


 


16

















 


authorized and approved by
all necessary City proceedings, findings and actions.  Accordingly, this Agreement constitutes the
legal, valid and binding obligation of the City, enforceable in accordance with
its terms.


 


23.           Governing
Law.  The
laws of the State of Missouri will govern this Agreement.


 


24.           Amendments.  This Agreement may not be
amended or otherwise modified except in writing signed by each of the parties.


 


25.           Severability.  If any provision of this
Agreement, in whole or in part, is held invalid, that provision or specific
part of the provision shall be deemed severed from this Agreement and will not
invalidate the remainder of this Agreement or that provision.


 


26.           Reversion
of City Property and Right of First Refusal.  If this Agreement is terminated prior to
issuance of Class B License to Developer issued by the MGC for the Project
(a “Termination Date”), all property conveyed to Developer by the City or
vacated by the City for the Project shall revert to ownership by the City.  Developer shall execute such deeds or other
documentation as may be reasonably required by the City to effect such
reversion.  In addition, the City shall
have a right of first refusal for all other real estate acquired by Developer
for the Project (the “Right of First Refusal”), as follows:


 


26.1.        If
at any time after the Termination Date, Developer receives a bona fide offer
(an “Offer”) to purchase all or any part of the Project Site owned by Developer
(such all or part being hereafter referred to as the “Property”) and Developer
is willing to accept the Offer, Developer shall promptly give to the City
written notice (the “Notice”) of the name and address of the person or entity
making the Offer (the “Offeror”) and the price and other terms of the Offer and
of Developer’s willingness to accept the Offer.


 


26.2.        The
City may exercise the Right of First Refusal within twenty (20) days after
receipt of the Notice by notifying Developer that the City will acquire the
Property for the price and on the terms specified in the Offer, including
without limitation any contingencies contained in the Offer.  If the City does not exercise the Right of
First Refusal, Developer may sell and transfer the Property to Offeror for the
price and on the terms specified in the Offer and no other.  Such sale and transfer will terminate the
Right of First Refusal with respect to the Property as conveyed to Offeror.


 


26.3.        If
the sale and transfer of the Property to Offeror does not occur, the Right of
First Refusal shall remain in full force and effect.  The failure of the City to exercise the Right
of First Refusal does not constitute a waiver of the Right of First Refusal as
to any subsequent offers.


 


26.4.        If
the City exercises the Right of First Refusal but fails to acquire the
Property, then this Right of First Refusal shall terminate with regards to the
Property.


 


26.5.        Any
transfer of the Property made in violation of the City’s rights under this
Right of First Refusal shall be void and the City shall have the right to
acquire the Property for the same price and on the same terms as applied to the
attempted transfer.


 


27.           Recording.  This Agreement may be recorded
by either party in the real estate records of the County in which the Project
Site is located.


 


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28.           Run
with the Land.  The provisions of this Agreement are
covenants running with the land within the Project Site.


 


29.           Termination.  In addition to any right of
termination otherwise provided in this Agreement, this Agreement may be
terminated by the City, and shall become null and void, with no further
obligations of the City and Developer to each other hereunder, if Developer,
after notice and opportunity to cure as provided in Paragraph 18: (1) fails
to satisfy any Developer Commitment within the time specified for the
Commitment; (2) files for bankruptcy, is administratively dissolved,
becomes insolvent as that term is identified in 11 U.S.C. §101, or otherwise
ceases to be authorized to do business in the State of Missouri; (3) Developer
makes changes to the Project pursuant to Paragraph 6 that materially adversely
impact the City’s interests or impose material additional costs on the City; (4) Construction
Commencement does not occur by three (3) years after Prioritization of
Developer; (5) if Developer’s gaming license or gaming license renewal for
the Project is denied, surrendered, revoked or terminated, and is not
reinstated within one (1) year after such event; or (6) if any party
other than Developer is selected by the MGC for Prioritization for a site in
the City of Cape Girardeau.


 


[Signatures on next page]


 


18

















 


IN WITNESS WHEREOF, City of Cape Girardeau and
IOC-Cape Girardeau LLC have signed this Agreement, which may be signed in
counterparts and by facsimile.


 


	
  City of Cape Girardeau

  	
   

  	
  IOC-Cape Girardeau LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Scott A. Meyer

  	
   

  	
  By:

  	
  /s/ Virginia M. McDowell

  
	
   

  	
   

  	
   

  
	
  Name: Scott A. Meyer

  	
   

  	
  Name: Virginia M. McDowell

  
	
   

  	
   

  	
   

  
	
  Title: City Manager

  	
   

  	
  Title: President and COO

  
	
   

  	
   

  	
   

  
	
  Date: October 4, 2010

  	
   

  	
  Date: September 2, 2010

  
	
   

  	
   

  	
   

  
	
  Address for notices:

  	
   

  	
  Address for notices:

  
	
  W. Eric Cunningham

  	
   

  	
  600 Emerson Road, Suite 300

  
	
  City Attorney

  	
   

  	
  St. Louis, MO 63141

  
	
  401 Independence, P.O. Box 617

  	
   

  	
   

  
	
  Cape Girardeau, MO 63702-0617

  	
   

  	
  With a copy to:

  
	
   

  	
   

  	
  c/o Gallop, Johnson & Neuman, L.C.

  
	
  ATTEST:

  	
   

  	
  Attn: Thomas J. Campbell

  
	
   

  	
   

  	
  101 South Hanley, Suite 1700

  
	
   

  	
   

  	
  St. Louis, MO 63105

  
	
  /s/ Gayle L. Conrad

  	
   

  	
   

  
	
  City Clerk

  	
   

  	
   

  
					



 


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