The URL can be used to link to this page

HRA Agenda 08-29-2005 e- . . AGENDA FOR SPECIAL MEETING MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY Monday, August 29, 2005 - 6:00 p.m. 505 Walnut Street - West Prairie Room Commissioners: Chair Darrin Lahr, Vice Chair Dan Frie, Steve Andrews, Brad Barger, and l3ill Fair. Council Liaison: Wayne Mayer. Staff: Rick Wolfsteller, Ollie Koropchak, and Angela Schumann. I. Call to Order. 2. Public llearing on the Business Subsidy Agreement. Continued Public Hearing on the Sale of Land. Consideration to adopt a resolution approving Purchase and Redevelopment Contract between the Housing and Redevelopment Authority and Rocky Mtn Group, LLC. 3. Other Business: Next HRA meeting - Wednesday, September 7,2005 4. Adjournment. . . . HRA Agenda - 08/29/05 2. Public Hearin~ on the Business Subsidy Ae:reement and continued Public Hearine: on the Sale of Land. Consideration to adopt a resolution approvine: Purchase and Redevelopment Contract between the ARA in and for the City of Monticello and Roekv Mtn Group, LLC. A. Reference and hacke:round: PUBLIC HEARING - BUSINESS SUBSIDY AGREEMENT As the assistance to the redeveloper "Rocky Mtn Group LLC" exceeds $100,000, the HRA must hold a public hearing according to the Minnesota Statutes, Section l16J.993-116J.995. Although a public hearing notice appeared in the local newspaper on August 4, 2005, the notice did not include an amendment to the Business Subsidy Act adopted by the Legislators during the special session. No public hearing was held by the HRA on August 16,2005. The public hearing notice was re-published in the local newspaper on August 1 S thereby meeting the notice requirerllent as so amended. l'he "Business Subsidy Agreement" is Section 3.8 of the Purchase and Redevelopment Contract by and between the HRA and Rocky Mtn Group I,LC. The Agreement describes the purpose and job and wage-levels goals for the subsidy, remedies if goals are not met, and reporting requirements. The City Council on August 22, 2005, adopted a resolution approving the Business Subsidy Agreement between the HRA and Rocky Mtn Group, LLC subject to the lIRA approval ofthe Purchase and Redevelopment Contract between the I IRA and Rocky Mtn Group LtC. OPEN THE PUBLIC HEARING FOR COMMENTS AND QUESTIONS - CLOSE THE PUBLIC HEARING ON TI-IE BUSINESS SUBSIDY AGREEMENT. CONTINUED PUBLIC I fEARING - SALE OF LAND The City of Monticello established the Housing and Redevelopment Authority (HRA) to carry out the goals and objectives within Redevelopment Plan of Central Monticello Redevelopment Project No. 01. The HRA can acquire and sale land for the purpose of economic, redevelopment, and/or housing development. However, unlike the City of Monticello, the HRA must hold a public hearing prior to sale of land according to Minnesota Statutes. Said public hearing notice appeared in the local newspaper on August 4,2005, with a public hearing date of August 16,2005. On August 16,2005, the HRA made a motion to continue the public hearing from August 16 to August 29, 2005, consistent with the business subsidy agreement public hearing and the consideration to approve the Purchase and Redevelopment Contract. HRA Agenda - 08/29/05 . Some time ago, the City Council approved a motion to deed the 35 acres of Otter Creek Crossing to the HRA via a "quick claim deed". At the closing for the 35-acre parcel between the City and John Chadwick in Deccmbcr 2004, the HRA and City each contributed $500,000. The remaining 85 acres is under a Contract for Deed with principal and interest payments beginning December 2005 in the amount of approximately $200,000 annually over ten years. The rationale for the Council to deed the property to the HRA: The HRA collects and has the authority to spend tax increment. It simplifies and consolidates the land sale and negotiation process (land write-down) to one governmental entity for the benefit of the end- user. ARTICLE III of the Purchase and Redevelopment Contract outlines the conveyance, purchase price, and conditions for the acquisition and conveyance of the 8.64 acres to Rocky Mtn Group, T LC. AFTER COMMENTS AND QUESTIONS - CLOSE THE PUBLIC HEARING ON THE SALE OF LAND. PURCHASE AND REDEVELOPMENT CONTRACT . The Purchase and Redevelopment Contract by and between the HRA and Rocky Mtn Group LLC was prepared by BRA Attorney Steve Bubul, Kennedy & Graven. Unlike contracts of the past, this contract includes a quit claim deed for purpose of conveying property to Rocky Mtn, an Interfund Loan for advancemcnt of certain costs in connection with TIF District No. 1- 36, and an Assessment Agreement. On August 16, the HRA reviewed the draft copy of the Purchase and Rcdevclopment Contract with suggested modifications made by the Attorney and Executive Director as highlighted. Substantially complete construction of the minimum improvements by May 1,2007, was to be verifIed. The most significant suggestion was to change Section 3.6 Soils, Environmental Conditions. Grading (b). It was suggested the city remove stockpile ($27,000 estimatc) and redeveloper does general grading ($20,000 estimate) of site at thcir expense with the use of exeess sand from another city site at an amount and value determined by the WSB, Inc. At a meeting prior to August 16 between WSB, the redeveloper, and stafT; it was suggested the redeveloper get two bids fix rough grading for reimbursement by the HRA and two bids for rough grading for reimbursement by the redevcloper. WSB expresscd excess sand was available on the remaining city land and would be available to the redeveloper at no cost. Larson Excavating was given thc OK to proeeed with removal the stockpile on the 16th. . 2 HRA Agcnda - 08/29/05 . A License Agreement was prepared by the HRA Attorney which would allow the redevelopcr thc right to entry the city property solely for the purpose of grading and excavation................. This agreement was an add-on item to the agenda to accelerate project commence111ent. The I IRA did not approve authorization to enter into the Liccnse Agrecment between the HRA and Rocky Mtn Group LLC until the grading issue was resolved and the HRA requestcd the rcmoval of the stockpile be put on hold. The HRA's rationale: In November 2005, the stockpile will be disbursed over thc site by the contractor hired by the City of Monticcllo to install the infrastructure and utilities in accordance with the city's bid. It did not include an extra cstimated cost 01'$27,000 to move the stockpile twice. Upon completion of the infrastructure and utilities, thc city plans to then grade the sitc to appear as a level site "general grading" and offer land at $1.00 per square foot. On August 17,2005, the rough grading bids were faxed to the Office of the HRA with thc following estimates: Rough grading rei111bursement by City $45,000 and rough grading rcimbursement by redeveloper, $98,000. . The attached Purchase and Redevelopment Contract has been amendment per the rccommcndation ofthc HRA Chair and Commissioncr Andrews. Thc underline sections note both the suggestions discussed at the August 16 meeting and the subsequent recommendations by the two commissioners. The HRA will review thesc at the meeting. A copy has been provided thc Dahlheimer's attorney and thc closing date left blank. WSB, Inc. is cheeking on a realistie date for the City to c0111plete removal of stockpile and general grading. B. Alternativc Action: 1. Motion to adopt a resolution approving the Purchase and Rcdevelop111ent Contract between the lIRA in and for the City of Monticello and Rocky Mtn Group, LLC. 2. Motion to deny adoption of the resolution approving the Purchase and Redevelopmcnt Contract between thc HRA in and for the City of Monticello and Rocky Mtn Group, lLC. 3. A motion to table any action. C. Recommendation~ The City Administrator recommends altcrnativc no. 1. . 3 BRA Agenda - 08/29/05 . D. Supoortine Data: Two publ ic hearing notices, resolution Cor adoption, Purchase and Redevelopment Contract, and letter by Chair Lahr. . . 4 . . . HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO RESOLUTION NO . RESOLUTION APPROVING PURCHASE AND REDEVELOPMENT CONTRACT BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO AND ROCKY MTN GROUP, LLC. BE IT RESOLVED by the Board of Commissioners ("Board") of the Housing and Redevelopment Authority in and for the City of Monticello ("Authority") as follows: Section 1. Recitals. 1.01. 'J'he Authority currently administers Central Monticello Redevelopment Project No. 1 (the "Project"); and has on this date approved (and recommend approval by the City of) the creation of Tax Increment Financing District No. 1-36 (the ''TIF District") within the Project, all pursuant to Minnesota Statutes, Sections 469.001 to 469.047 and Sections 469.174 to 469.179. 1.02. To facilitate redevelopment of certain property in the TIF District, and Authority proposes to enter into a Purchase and Redevelopment Contract (the "Contract") between the Authority and Rocky Mtn Group, LLC (the "Redeveloper"), under which among other things the Authority will convey certain property described as Lot 1, Block I, Otter Creek Crossing 1 st Addition (the "Redevelopment Property") to Redeveloper. 1.03. The City currently owns the Redevelopment Property and has previously authorized the conveyance of that property to the Authority in order to promote the development of the Otter Creek Crossing industrial park. 1.04. The assistance under the Contract constitutes a "business subsidy" exceeding $100,000 within the meaning of Minnesota Statutes, Section 116J.993 to 116J.995 (the "Business Subsidy Act"). 1.05. The "business subsidy agreement" as required under the Business Subsidy Act is included as one section of the Contract, and the Authority has on this date conducted a duly noticed public hearing regarding both the sale of the Redevelopment Property to Redeveloper and the business subsidy agreement, at which all interested persons wcre give an oPP011unity to be heard. Section 2. Authoritv Approval; Further ProceedinQ:s. 2.0 I. The Board approves the Contract as presented to the Board, including the business subsidy agreement therein, subject to modifications that do not alter the substance of the transaction and that are approved by the Chair and Executive Director, provided that execution of the documents by the those officials shall bc conclusive evidence of their approval. sm-266537vl MN 190-121 . . . 2.02. Authority staif and officials are authorized to take all actions necessary to perform the Authority's obligations under the Contract as a whole, including without limitation execution of any deed or other documents necessary to acquire the Redevelopment Property trom the City and to convey such property to Redeveloper. Approved by the Board of Commissioners of the Housing and Redevelopment Authority in and for the City of Monticello this day of 29thh day of August, 2005. Chair ATTEST: Executive Director 2 ............105.44 '1..........179.00 ............145.91 ............192.00 ............128.62 s ........107.34 ver ..9.384.00 ..............53.66 "...93.36 ... 75.00 ...... . 00.00 c. ....2.813.44 ...........176.31 escue ..80.63 ...........241.84 ........8.045.73 IC. ..11,312.70 ...........361.86 .............43.66 .............55.00 .............44.55 n ........535.98 ...........752.70 ........1.164.90 ...........169.45 iq. 32,334.39 ...........687.71 lia ......388.00 p. ....1.299.02 .............84.84 .............21.30 ......14.592.26 .............71.33 .......1.020.00 .......4.779.12 ..........714.04 . ........785.57 .......1.015.72 .......6.393.00 ............11.56 McDowall Company..............376.00 Melrose North Pyro. ..........8.000.00 Michels Trucking......................55.00 Minneapolis Finance..............203.00 MN GFOA..............................600.00 MN Rural Water Assoc. ........205.00 Monticello American Legion ..200.00 Monticello Office Prod...........427.60 Monticello Printing ................684.60 Monticello Senior Citizens..2,833.33 Monticello Times ................8.044.40 Monticello Tire & Auto ..........103.62 Moon Motor Sales ................352.62 NBP-North'N Bus. Prod. ......399.37 Nendza's Bike & Board ........175.00 Northwood Clustom Homes.... 1 0.00 Olson & Sons Electric............647.22 Olsonffodd ............................175.00 One Call Concepts ................562.05 Onyx Waste Servo ..............1.968.26 Pan-a-Gold S1. Cloud ............37.44 Paustls & Sons ......................732.33 Peterson Grimsmo Chapel....275.00 Phillips Wine & Spirits ........7.560.07 Pipeline Supply....................... .83.39 Pitney Bowes, Inc. ................122.21 Playpower LT Farmlngton......403.64 Plunkett's Pest Control..........415.35 Pres. Homes Housing ......11,315.35 Quality Wine & Spirits Co. ..1 ,234.00 R L Larson Excavating ..137,560.00 RCB Associates..................1.695.48 Recreation Supply ..................62.07 Red's Marathon ....................292.44 Reed Business Info. ..............210.08 Riteway Delivery ......................58.32 Riversedge Productions ........500.00 Riverside Oil ............................40.40 Rochester Ford Toyota ....17,817.46 Salzwedel/Patricia A...........1 ,415.95 Sawatzke/Jlm ........................900.00 Scherber/Drew......................175.oo Shuman/Cathy......................109.67 Simonson Lumber Co. ..........275.01 SimplexGrinnell....... ............... 727.10 Simpson/Cynthia R. ................72.90 Spectrum Supply Co. ............277.15 S1. Cloud Hospital............21.990.00 S1. Joseph Equipment. ..........318.99 Star Tribune ........................3,660.60 Strategic Equip. & Supply ....308.29 Streicher.s........................... .....65.00 Swift House Movers ..............500.00 TDS Internet Servlces............199.00 TOS Telecom (WI) ..............9,424.40 Tennessen/Laurie ..................108.16 Thorpe Distributing Co. ....37.581.45 Tomann FLPfferrance ......37.366.00 Twin City Ole Castings ....18, 148.50 United Laboratories ..............343.21 Utility Service Co. ............22,156.00 Viking Coca Cola ..................265.50 Viking Industrial Center ........457.42 Vonco II, LLC ........................177.50 Wardfflmothy Mark ................37.28 Waste Management Co. ..16,496.29 Water Laboratories....... ...... ...135.00 West Sherburne Trlbune..........54.60 Wilson/Daniel H. ....................989.69 Wine Companyffhe ..............130.00 Wright Co. Auditorffreas.. 74.519.35 Wright Co. Fire Chief Assoc.150.oo Wright Co. Recorder................29.50 WSB & Assoclates............35,706.63 Xcel Energy Mpls. ..............6.533.60 Y M C A ~ NW ......................455.00 Final Totals ..................1,192,749.28 "::NTS .on. by ,t 5 Inut , at .. to cribed as fol- ,cross Lot 1. . according ta. age and util- al comments ING Y the City of t 22nd. 2005 'latter: henslve Plan 'ermit for a lary Plat for 'cre residen- oilable at the ':Ire available :::cts, and all leard at this lject to the on Monday, ,."Aial y~by NOTICE OF PUBLIC HEARING MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY . WRIGHT COUNTY, STATE OF MINNESOTA NOTICE IS HEREBY GIVEN that the Housing and Redevelopment Authority in and for the City of Monticello, Minnesota ("HRA"). will hold a public hearing on August 29, 2005, at approximately 6:00 P.M. in the Academy Room, 505 Walnut Street. Monticello, Minnesota, regarding a pro- posed business suo bsidy to be granted by the Housing and Redevelopment Authority in and for the City of Monticello to Rocky Mountain Group LLC (the "Recipient") under Minnesota Statutes, Sections 116J.993 through 116J.995 (the "Business SUbsidy Act"). The proposed subsidy Involves tax increment financing assistance to facilitate development by the Recipient of an approximately 54,000 sq. ft. distribution center in the City of Monticello. Information about the proposed business subsidy. including a summary of the terms of the subsidy and a copy of the draft business subsidy agree- ment are available for inspection at City Hall during regular business hours. Any person with residence in the City, or the owner of taxable property in the City, may file a written complaint with the HRA if the HRA falls to com- ply with the Business Subsidy Act, and no action may be filed against the HRA for the failure to comply unless a written complaint Is filed. , All interested persons may appear at the hearing and present their views orally or prior to the meeting in writing. Written comments should be addressed to: Executive Director. Monticello HRA, 505 Walnut Street, Monticello, MN 55362. -Ollie Koropchak, Executive Director of the Monticello Housing and Redevelopment Authority (August 18, 2005) : ;:,F"'/ . '\,' 'K6mit VDKr enll'''Icmcnt, \ ,. "" "', < " P\9cddin9 or A~niuersRr., '. c.. ,. AnnoKncemcnt to Iticello agreement land oving pur- 'een the u.""',........~.n.........i1....._ _.&. - :1 , ,- . ~ .-;:- AI' .U.' I I "~I , I I ! I I II 'I II 'II , , i II il I i I I " ! I nsent Agenda WhICh d consideration of yroll and receipts, wire ~s, personnel matters ; fall sports coaching 'TIle roster was com- f~xcept for the _ >1 Girls Soccer :lpe, "" g. was the only board ;1' not to approve of the i. He objected mainly ;e he wasn't comfort- Ipproving bills without able to talk to Business gel' Bill Holmgren, who ,n vacation, because of going issue with checks atching up. tel' in the meeting, 'intendent Jim Johnson he board that he imple- ed a new step in the )Val process for checks. an employee of the dis- must get initials at the ram administrator level re using the district's ey. card a presentation by dIe School Assistant cipa! Brad Sellner on the ~rence between class size student to teacher ratio. .pproved the elementary ten.ndbook presented t board by Joe :k~ Irf, Linda Borger- l'" and Brad Sanderson. :pproved, with a 5-1 vote, acceptance of donations ;3.665 from Wal-Mart to be ,d as the board sees fit, 650 from the Lions Club Project 4 Teens, Wright .unty Peer Helpers Cross- ~ds. and T A TU, $900 from ~ Lions Club for )rnerstones, and $1,000 )m United Way for Middle hoo! Intramurals. Wigen was the only board ember to vote against the nan-LIllie /l.ll'U"'t>-. -_.' ers (one at Pinewood and one at Little Mountain). The ELL and Pinewood positions were discussed last month, but approvals were pending on the state budget. The district planned for a 45 percent increase, hut received four percent. . However, Superintendent Jim Johnson set aside $100,000 of the district's money in March for new posi- tions which, after factoring in categorical increases that had- n't been included in the budg- et, was more than enough to add in the kindergarten posi- tions- Johnson also told the board that he'd recently learned that the district had saved $20,000 on property insurance for the upcoming year. . Heard Johnson speak about the progress of the high school tennis courts and tbe Moose Sherritt Ice Arena. The tennis courts won't be ready for the start of the fall season due to a draining issue caused by the excess of clay found in the surface. The ten- nis season, which begins in two weeks. will start at Pinewood. The ice arena is again under construction after a series of complications, and it is hoped to be finished by Oct. L . Approved tbe scheduling of the next three meetings. A special board meeting was set for Aug. 15, 6.p.m" to go over state funding with Holmgren, An Ice Arena Committee meeting was set for Aug. 10 at 6:30 p.m., and a regular School Board meeting was set for Sept. 7 at 6 p.m. comment on the request oy '"" ,,'"'y. . ,. ...- " - hear all interested parties and shall consider all evidence offered.. Notice of the time and location of this hearing shall be given to all per, sons interested by mail and by publication tor three successive weeks. -Robert J. Hiivala, Wright County Auditor / Treasurer (July 28, Aug. 4, 11, 2005) NOTICE OF PUBLIC HEARING MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY WRIGHT COUNTY, STATE OF MINNESOTA NOTICE IS HEREBY GIVEN that the Housing and Redevelopment Authority in and for the City of Monticello, Minnesota, will hold a public hearing on August 16, 2005, at approximately 6:00 pM. in the Bridge Room, 505 Walnut Street, Monticello, Minnesota, regarding a proposed I- business subsidy to be granted by the Housing and Redevelopment . . . Authority in and for the City of Monticello to Rocky Mountain Group L.L.C. (the "Recipient") under Minnesota Statutes, Sections116J.993 through 116J .995. The proposed subsidy involves tax increment financing assis- tance to facilitate development by the Recipient of a 54,000 sq. ft. office/distribution center in the City of Monticello. Information about the proposed business subsidy, including a summa- ry of the terms of the subsidy and a copy of the draft business subsidy agreement are available for inspection at City Hall during regular business hours. All interested persons may appear at the hearing and present their views orally or prior to the meeting in writing. Written comments should be addressed to: Executive Director, Monticello IRA, 505 Walnut Street, Monticello, MN 55362. -Ollie Koropchak. Executive Director of the Monticello Housing and Redevelopment Authority (Aug. 4, 2005) NOTICE OF PUBLIC HEARING HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO - COUNTY OF WRIGHT STATE OF MINNESOTA -:f Sale of Land NOTICE IS HEREBY GIVEN that the Housing and Redevelopment Authority (the "Authority") in and for the City of Monticello, County of Wright, State of Minnesota, will hold a public hearing Tuesday, August 16, 2005, at approximately 6:00 p.m., at the Monticello Community Center, 505 Walnut Street, Monticello, Minnesota, relating to the proposed sale of land located within the Redevelopment Plan for Central Monticello Redevelopment Project No.1 and the TIF Plan for TIF District No. 1.36. The land proposed for sale is described as followS: Description: Lot 1, Block 1, Otter Creek Crossing 1 st Addition, City of Monticello, County of Wright. --Ollie Koropchak, HRA Executive Director (Aug. 4, 2005) SPECIAL MEETING NOTICE ... Of THE ' MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY TUESDAY, AUGUST 9, 2005, 4:00 P.M. ACADEMY ROOM, 505 WALNUT STREET. subject: 1. Consideration to discuss for resolution the non-performance date for approved GMEF Loan No. 024 and the EDA loan position. Applicant: Tapper's Holding, Inc. 2. Consideration to discusS the late payment policy and continued delin- quent payment on GMEF Supplemental Loan No. 014. (Carl Bondhus, Eric Bondhus, and Dennis Bondhus). 3. Other updates. -Ollie Koropchak. Community Development Department (Aug. 4, 2005) h n e Front DeskIHousekeeping ... _~ _~.~~...!".~~ ppl'f010n Third Draft ~ Au~ust25.2005 PURCHASE AND REDEVELOPMENT CONTRACT By and Between HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO, MINNESOTA . and ROCKY MOUNT.A1INMIN GROtH>, LLC , 2005 Dated as of: This document was drafted by: KENNEDY & GRAVEN, Chartered 470 U.S. Bank Plaza Minneapolis, Minnesota 55402 Telephone: 337-9300 ~ SJB-26630Xv3 MN190-121 . . ~ TABLE OF CONTENTS Page PREAMBLE ............................................................................................ ................................. 1 Section 1. I . Section 2.1. Section 2.2. Seetion 3.1. Section 3.2. Section 3.3. Seetion 3.4. Section 3.5. Section 3.6. Section 3.7. Section 3.8 Section 3.9 Section 4.1. Section 4.2. Section 4.3. Section 4.4. Section 5. I . Section 5.2. sm-266308v3 MN190-121 ARTICLE I Definitions Defin i t ions. . . .. . .. . . . . . . . .. . . .. . . . .. . . . . . . .. .. . .. . . . . .. .. .. .. .. .. .. .. .. .. .. .. .. . . . . .. . . . .. .. . . . . .. .. .. .. .. .. .. . .. . ... 2 ARTICLE II Representations and Warranties Representations by the Authority........................................................................ 5 Representations and Warranties by the Redeveloper.......................................... 5 ARTICLE III Acquisition and Conveyance of Property Conveyance 0 l' the Property................................................................................ 7 Purchasc Price; Provisions for Paymcnt ............................................................. 7 Conditions of Conveyance.................................................................................. 7 Place of Document Execution, Delivery and Recording, Costs ......................... 8 Title........................................ ............................................................................. 8 Soil and Environmental Conditions .............................. ................................. .....9 Advancc of Land and Other Costs; Tax Incremcnt Interfund Loan ...................9 Business Subsidy Agreement............................................................................ 10 Payment of Administrative Costs ..................................................................... 12 ARTICLE IV Construction of Minimum Improvements Construction of Minimum Improvements ........................................................ 13 Construction Plans............................................................................................ 13 Commencemcnt and Completion of Construction............................................ 14 Ccrtificate of Completion.. .............................. ............... ............ ...................... 14 ARTICLE V Insurancc Insurance........................................................................................................... 16 Subordination.................................................................................................... 17 1 . . . Section 6.1. Section 6.2. Section 6.3 Section 7.1. Section 7.2. Section 7.3. Section 8.1. Section 8.2. Section 8.3. Section 9.1 . Section 9.2. Section 9.3. Section 9.4. Section 9.5. Section 9.6. Section 10.1. Section 10.2. Section 10.3. Section 10.4. Scction 10.5. Section 10.6. Section 10.7. Section 10.8. Section 10.9 Section 10.10 S./B-266308v3 MN IC!O-121 ARTICLE VI Dclinquent Taxes and Review of Taxes Right to Collect Delinquent Taxes.................................................................... 18 Review of Taxes............................................................................................... 18 Assessment Agreement..................................................................................... 1 8 ARTICLE VII Financing Financing........................................................................................................... 19 Authority's Option to Cure Default on Mortgage............................................. 19 Subordination and Modification for the Benefit of Mortgagee ........................ 19 ARTICLE VIII Prohibitions Against Assignment and Transfer; Indemnification Representation as to Redevelopment ................................................................ 21 Prohibition Against Redeveloper's Transfer of Property and Assignment of Agreement................................................................................ 21 Release and Indemnification Covenants........................................................... 22 ARTICLE IX Events of Default Events of Default Defincd ................................................................................ 24 Remedies on Default......................................................................................... 24 Revesting Title in Authority Upon Happening of Event Subsequent to Conveyance to Redeveloper............................................................................. 24 Resale of Reacquired Propeliy; Disposition of Proceeds .................................26 No Remedy Exclusive....................................................................................... 26 No Additional Waiver Implied by One Waiver ................................................ 27 ARTICLE X Additional Provisions Conflict ofInterests; Authority Representatives Not Individually Liable........ 28 Equal Employment Opportunity....................................................................... 28 Restrictions on lJ se ........................................................................................... 28 Provisions Not Merged With Deed................................................................... 28 Titles of Articles and Sections .......................................................................... 28 Notices and Demands....................................................................................... 28 Counterparts..................................... ................................................................. 29 Recording.......................................................................................................... 29 Alnenchnent....................................................................................................... 29 Authority or City Approvals ............................................................................. 29 11 . . . Section 10.11 Section 10.12 Termination 0..............................................0.0... 0.0.0...0.0.......................................29 Choice of Law and Venue................. o. 0.0... 0.0.0.0.0.00........................................ 0 0" 29 TESTI MC)N I U Mo.................. 0......... 0..0.0.0... 0.0.0.................. ..........................0.0.... 0.0.0......... 0 ........ S-l Slei-N ATl JRES ...00..0.0.0.0.0....... 0.0.0.0.0....0.......... ........................... 0... 0.0............................... ......... S-I SCHEDULE A Description of Redevelopment Property SCHEDULE B Form of Quit Claim Deed SCHEDULE C Resolution approving Interfund Loan SClIEDU LE D Certificate of Completion SCIIEDULE E Assessment Agreement SCHEDlJLE F Otter Creek Crossin!! Declaration (The remainder of this page is intentionally left: blank.) SJR-266308v3 MN 190-121 111 . . . PURCHASE AND REDEVELOPMENT CONTRACT THIS AGREEMENT, made on or as of the _ day of___~_, 2005, by and between HOUSING AND REDEVELOPMENT AUTHORlTY IN AND FOR THE CITY OF MONTICELLO, MONTICELLO, MINNESOTA, a puhlie body corporate and politie established pursuant to Minnesota Statutes, Sections 469.001 to 469.047 (the "Authority"), and ROCKY MOUNT,t\INMTN GROUP, LtC, a Minnesota limited liability company (the "Redeveloper"). WITNESSETH: WI [EREAS, the Authority has undertaken a program to promote eeonomic development and job opportunities and to promote the redevelopment of land whieh is underutilized within the City, and in this connection created a redevelopment projeet known as the Central Monticello Redevelopment Project No. 1 (the "Redevelopment Project") pursuant to Minnesota Statutes, Sections 469.00} to 469.047 (the "HRA Aet"); and WHEREAS, pursuant to the HRA Act, the Authority is authorized to acquire real property, or interests therein, and to undertake certain activities to facilitate the redevelopment of real property by private enterprise; and WHEREAS, the Authority has acquired or will acquire certain property described in Schedule A (the "Redevelopment Property") within the Redevelopment Project, and intends to convey that property to the Redeveloper for development of certain improvements dcscribed herein; and WHEREAS, the Authority and City have approved a Tax Increment Financing Plan for Tax Increment Financing District No. 1-36 (the "TIF District") pursuant to Minncsota Statutes, Sections 469. ] 74 to 469. ] 79, made up of the Redevelopment Property; and WHEREAS, the Authority believes that the redevelopment of the Redevelopment Property pursuant to this Agreement, and fulfillment generally of this Agreement, are in the vital and best interests of the City and the health, safety, morals, and welfare of its residents, and in accord with the public purposes and provisions of the applicable State and local laws and requirements under which the Project has been undertaken and is heing assisted. NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: (The remainder of this page is intentionally Icft blank.) S.Il3.2(i6JOXv3 MN190-121 1 . . . ARTICLE I Definitions Section 1.1. Definitions. In this Agreement, unless a diflerent meaning clearly appears from the context: "Agreement" means this Agreement, as the same may be from time to time modified, amended, or supplemented. "Authority" means the Housing and Redevelopment Authority in and for the City of Monticello, or any successor or assign. "Authority Representative" means the Executive Director of the Authority, or any person designated by the Executive Director to act as the Authority Representative for the purposes of this Agreement. "Business Subsidy Act" means Minncsota Statutes, Section 1161.993 to 116.1.995, as amended. "Certificate of Completion" means the certification provided to the Redeveloper, or the purchaser of any part, parcel or unit of the Redevelopment Property, pursuant to Section 4.4 of this Agreement. "City" means the City of Monticello, Minnesota. "Closing" has the meaning provided in Section 3.3(b). "Construction Plans" means the plans, specifications, drawings and related documents on the construction work to be performed by the Redeveloper on the Redevelopment Property which (a) shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the appropriate building o1Jicials of the City, and (b) shall include at least the following for each building: (1) site plan; (2) foundation plan; (3) bascment plans; (4) floor plan for each /1oor; (5) cross sections of each (length and width); (6) elevations (all sides); (7) landscape plan; and (8) such other plans or supplements to the foregoing plans as the Authority may reasonably request to allow it to ascertain the nature and quality of the proposed construction work. "County" means the County of, Minnesota. "Event of Default" means an action by the Redeveloper listed It1 Article IX of this Agreement. "I [older" means the owner of a Mortgage. 8.1 1.1-2(,6.l0Xv.l MN 190-121 2 . "lIRA Act" means Minnesota Statutes, Sections 469.001 to 469.047, as amended. "lnterfund Loan" has the meaning provided in Section 3.7 and Schedule C. "Minimum Improvements" means the construction on the Redevelopment Property of an approximately 54,000 square foot warehouse and distribution facility, including office space necessary for and related to such activities. "Mortgage" means any mortgage made by thc Redeveloper which is secured, in whole or in part, with the Redevelopment Property and which is a permitted encumbrance pursuant to the provisions of Article VIII of this Agreement. "Otter Creek Crossing Declaration" means the Declaration of Protective Covenants, Conditions and Protections for Otter Creek Crossing filed February 17, 2005 in the Oft-ice of the County Recorder for County, Minnesota as Document No. A 917185.947485. attached as Schedule F. "Preliminary Agreement" means the Preliminary Development Agreement between the Authority and the Redeveloper dated as of July 18,2005. "Redeveloper" means Rocky MountuinMtn Group, LLC or its permitted successors and assIgns. "Redevelopment Project" means the Authority's Central Minnesota Redevelopment . Project No. I. "Redevelopment Property" means the real property described II1 Schcdule A of this Agreement. "Redevelopment Plan" means the Authority's Redevelopment Plan for the Redevelopment Project, as amended. "State" means the State of Minnesota. "Tax Increment" means that portion of the real property taxes which is paid with respect to the Redevelopment Property and which is remitted to the Authority as tax increment pursuant to the Tax Incremcnt Act. "Tax Incrcment Act" means the Tax Increment Financing Act, Minnesota Statutes, Sections 469.174 to 469.1799, as amended. "Tax Increment District" or "TIF District" means the Authority's Tax Increment Financing District No. 1-36. . "Tax Increment Plan" or "TIF Plan" means the Authority's Tax Increment Financing Plan for Tax Increment Financing District No. 1-36, as approved by the Authority on August 16, 2005 and by the City on August 22, 2005, and as it may be amended from time to time. SJ 1I.26630Xv3 MN190-121 3 . . . "Tax OiIicial" means any County assessor; County auditor; County or State board of equalization, the commissioner of revenue of the State, or any State or federal district court, the tax court of the State, or the State Supreme Court. "Termination Date" means the earlier of (a) date of the Authority's last receipt of Tax Increment from the TIF District in accordance with Section 469.176. suhd. thO) of the TIF Act, or (b) the date the Interfund I,oan has been paid in full, defeased, or terminated in accordance with the terms of the resolution set forth in Schedulc C. "Unavoidable Delays" means delays beyond the reasonable control of the party seeking to be cxcused as a result thcrcof which are thc direct result of war, terrorism, strikes, othcr labor troubles, firc or other casualty to the Minimum Improvemcnts, litigation commenced by third parties which, by injunction or other similar judicial action, directly rcsults in delays, or acts of any federal, state or local governmcntal unit (other than the Authority in excrcising its rights under this Agreement) which directly result in delays. Unavoidable Dclays shall not include delays in the Redeveloper's obtaining of permits or governmental approvals nccessary to enable construction of the Minimum Improvements by the dates such approval and construction is required under Sections 4.2 and 4.3 of this Agreement. ('I'he remainder of this page is intentionally Icft blank.) SJI3-266308v_, MN190-121 4 . ARTICl..F~ II Renresentations and Warranties Section 2.]. Representations by the Authoritv. The Authority makes the following representations as the basis for the undertaking on its part herein contained: (a) The Authority is a housing and redevelopment authority duly organized and existing under the laws of the State. Under the provisions of the Act, the Authority has the power to enter into this Agreement and carry out its obligations hereunder. (b) The activities of the Authority are undertaken to foster the redevelopment of certain real property which for a variety of reasons is presently underutilized, to prevent the emergence of blight, to create increased tax base and employment in the City, and to stimulate further development of the Otter Creek Crossing industrial park and the Redevelopment Project as a whole. (c) The RedeveloDment Pronerty is currently zoned . and the Minimum Imnrovements conform with the Dermitted land uses allowed within this zonin!! classification. . (d) The RedeveIonment ProDerty is not suhiect to any Dendin!! condemnation hv the Authoritv or City. and to bests of the Authority's knowled!!e there are no other Dendin1! Droceedin!!s that would nrevcnt use of the RedeveloDment Pronerty bv RedeveloDer in accordance with this A1!reement. Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper represents and warrants that: (a) The Redeveloper is a limited liability company duly organized and in good standing under the laws of the State, is not in violation of any provisions of its articles of organization or the laws of the State, is duly authorized to transact business within the State, has power to enter into this Agreement and has duly authorized the execution, delivery and performance of this Agreement by proper action of its members. (b) If the Redeveloper acquires the Redevelopment Property in accordance with this Agreement, the Redeveloper will construct, operate and maintain the Minimum Improvements in accordancc with the tcrms of this Agreement, the Redevelopment Plan and all local, state and federal laws and regulations (including, but not limited to, environmental, zoning, building code and public health laws and regulations). (c) The Redeveloper has received no notice or communication from any local. state or federal oiIicial that the activities of the Rcdeveloper or the Authority in the Project Area may be or will be in violation of any environmental law or regulation (other than those notices or . communications of which thc Authority is aware). The Redeveloper is aware of no facts the SJl3-261.i308v3 MNl'JO-121 5 . . . existence of which would cause it to be in violation of or give any person a valid claim under any local, state or federal environmental law, regulation or review procedure. (d) The Redeveloper will construct the Minimum Improvements in accordance with all local, state or federal energy-conservation laws or regulations. (e) The Redeveloper will obtain, in a timely manner, all required permits, licenses and approvals, and will meet, in a timely manner, all requirements of all applicable local, state and federal laws and regulations which must be obtained or met before the Minimum Improvements may be lawfully constructed. (f) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach or, the terms, conditions or provisions of any patinership or company restriction or any evidences of indebtedness, agreement or instrument of whatever nature to which the Redeveloper is now a party or by which it is bound, or constitutes a default under any of the foregoing. (g) The proposed development by the Redeveloper hereunder would not occur but for the tax increment financing assistance being provided by the Authority hereunder. (h) The Redeveloper is not currently in default under any business subsidy agreement with any grantor, as such terms are defined in the business Subsidy Act. (The remainder of this page is intentionally left blank.) SJR-26630Xv3 MNI,)O-121 6 . . . ARTICLE HI ACQuisition and Convevance of Property Section 3.1. Convevanee of the Property. As of the date of this Agreement, the City owns the Redevelopment Property and has agreed to transfer title to the Authority. The Authority will eonvey title to and possession of the Redevelopment Property to the Redeveloper, subjeet to all the terms and conditions of this Agreement. The parties agree and understand that this Agreement supersedes in all respects the Preliminary Agreement. Section 3.2. Purehase Price; Provisions fix Payment. (a) The purchase price to be paid to the Authority by the Redeveloper in exchange for the conveyance of the Redevelopment Property is $549,095. The parties agree and understand the purchase price represents 217,800 square feet (five acres) at a price of $.95 per square foot, and 159,156 square feet (3.65 acres) at a price of $2.15 per square foot. The purchase price shall be payable by the Redeveloper as follows: (i) earnest money in the amount of $10,000, receipt of which the Authority acknowledges upon execution in full of this Agreement; and (ii) the balance payable in cash or certified check at Closing. Section 3.3. Conditions of Conveyance. (a) The Authority shall convey title to and possession of the Redevelopment Property to the Redeveloper by a deed substantially in the limn of the deed attached as Schedule B to this Agreement. The Authority's obligation to convey the Redevelopment Property to the Redeveloper is subject to satisfaction of the following terms and conditions: (1) The Authority having approved Construction Plans for the Minimum Improvements in accordance with Section 4.2. (2) The Authority having approved financing for construction of the Minimum Improvements in accordance with Article VII hereof, and the Redeveloper having closed on such permanent financing at or betl)fe Closing on transfer of title to the Redevelopment Property to the Redeveloper. (3) The Redeveloper having reviewed and approved (or waived objections to) title to the Redevelopment Property as set f<Jrth in Section 3.5. (4) The Redeveloper havi ng reviewed and approved (or wai ved objections to) soil and environmental conditions as set f'Jrth in Section 3.6. (5) The Authority havinl! removed the dirt stocknile and comnleted General Grading: on the Redevelonmcnt Pronerty in accordance with Section 3.6(b): and sm-26630Xv3 MN I <)(J-121 7 . (6) There is no uncured Event of Default under this Agreement. Conditions 0), (2), and (~) are solely for the benefit of the Authority, and may he waived by the Authority. Conditions (3)~ and-E44~) are solely for the benefit of the Redeveloper, and may be waived by the Redeveloper. (b) The closing on conveyance of the Redevelopment Property from the Authority to the Redeveloper shall occur upon satisfaction of the conditions specified in this Section, hut no later than Sentember, 2005 or at such earlier date as the parties hereto agree in writing ("Closing"). Section 3.4. Place of Document Execution, Delivery and Recording, Costs. (a) Unless otherwise mutually agreed by the Authority and the Redeveloper, the execution and delivery of all deeds, documents and the payment of any purchase price shall be made at the offices of the /\uthoritytitle comnanv selected bv Redevelooer or such other location to which the parties may agree. . (b) The deed shall be in recordable form and shall be promptly recorded in the proper o11ice for the reeordation of deeds and other instruments pertaining to the Redevelopment Property. At Closing, the Redeveloper shall pay: al+-recording costs, induding for the deed (excludinl! state deed taxl, in connection with thc conveyance of the Redevelopment Property; costs of recording any in~;truments used to clear title encumbrances; title insurance commitment fees and premiums, if any; and title company closing fees, if any; and a portion of City trunk fees in the amount of$37,914. The parties agree and understand that the Redevelopment Property is exempt from property taxes fix taxes payable in 2005, and is expected to be exempt for taxes payable in 2006. (c) At Closing the Authority shall payor cause to be paid the state deed tax. costs of recording anv instruments used to clear title eneumbrances. all outstanding special assessments against Redevelopment Property, all park dedication fees owed to the City pursuant to City ordinances in connection with the Redevelopment Property, and all City trunk fees in excess of the amount paid by Redeveloper under paragraph (b) above. The parties agree and understand that all such costs are included in the purchase price payable under Section 3.2, exccpt to the extent otherwise described in Section 3.7. . Section 3.5. Title. (a) As soon as practicable after the date of this Agreement, the Redeveloper shall obtain a commitment for the issuanee of a policy of title for the Redevclopment Property. The Redeveloper shall have twenty (20) days from the date of its receipt of such commitment to review the state of title to the Development Property and to provide the Authority with a list of written objections to such title. Upon receipt of the Redeveloper's list of written objections, the Authority shall proceed in good t~tith and with all due diligence to attempt to cure the objections made by the Redeveloper. In the event that the Authority has failed to cure objections within sixty (60) days after its receipt of the Redeveloper's list of such objections, the Redeveloper may by the giving ofwrittcn notice to the Authority (i) terminate this Agreement, upon the receipt of which this Agreement shall be null SJH-26630Xv3 MNI9(J-121 8 . . . and void and neither party shall have any liability hereunder, or (ii) waive the objections and . . . proceed to Closing. Upon termination, the Authority shall promptly return to the Redeveloper any earnest money. The Authority shall have no obligation to take any action to clear defects in the title to the Redevelopment Property, other than the good faith efforts described above. (b) 'I'he Authority shall take no actions to encumber title to the Redevelopment Property between the date of this Agreement and the time the deed is delivered to the Redeveloper. The Authoritv exnresslv a!!rees that it will not cause or oermit the attachment of any mechanics. attorneys. or other liens to the Redevelooment Prooertv orior to Closin!!. Unon Closinl!. the Authoritv is obli!!ated to Day all costs to discharl!e any encumbrances to the Redevelonment ProDertv attributable to actions of the Authoritv. its emDlovees. officers. al!ents or consultants. includinl! without limitation any architect. contractor and or enl!meer. (c) The Redeveloper shall take no actions to encumber title to the Redevelopment Property between the date of this Agreement and the time the deed is delivered to the Redeveloper. The Redeveloper expressly agrees that it will not cause or permit the attachment of any mechanics, attorneys, or other liens to the Redevelopment Property prior to Closing. Notwithstanding termination of this Agreement prior to Closing, Redeveloper is obligated to pay all costs to discharge any encumbrances to the Redevelopment Property attributable to actions of Redeveloper, its employees, officers, agents or consultants, including without limitation any architect, contractor and or engineer. Section 3.6. Soils. Environmental Conditions, Grading. (a) Before closing on conveyance of the Redevelopment Property from the Authority to the Redeveloper, the Redeveloper may enter the Redevelopment Property and conduct any other environmental or soils studies deemed necessary by the Redeveloper. It~ at least 10 days bet()fe Closing the Redeveloper determines that hazardous waste or othcr pollutants as defined under federal and state law exist on the property, or that the soils are otherwise unsuitable for construction of the Minimum Improvements, the Redeveloper may at its option terminate this Agreement by giving written notice to the Authority, upon receipt of which this Agreement shall be null and void and ncither party shall have any liability hercunder, except the Authority shall promptly return to the Rcdcveloper any earnest money. (b) Notwithstanding anything to the contrary hercin, orior to Closinl! the Authority will undertake (or cause to be undertaken) (j) removal of the existinl! stockoile of dirt located on the Redevclooment Pronertv. at no additional cost to Redevelooer (the cost of which the Authoritv will reimburse from Tax Increment throul!h the Interfund Loan); and lii) General Grading of the Redevelopment Property at no additional cost to Redeveloper (such cost being includcd in the purchase price under Section 3.2). For the purposes of this Section, the term "General Grading" means general :;ite t;rading according to a grading plan preparcd by Rcdcvclopcr and appro,,'ed by the City, but e)(e1ude~; ~;pecilic gruding relatcd to the Minimum Improvcments. The ,t\uthority in it~; ~;ole di~;cretion may undcrtakc thc Gcneral Grading bcforc Closing or \vithin 30 days after Clo~;ing. If General Grading oeeur~; after Clo~;ing, Redeveloper grant~; Authority, it::, employees, contractors and agent; a right of aeee~;~; to undertake such "york, S.I B-2 663 08v 3 MNI'!O-I2I D . . . or, if mutually agreed by the partie:;, Redevelopcr may undcrtakc such work. If Rcdeveloper undcrtakcs General Gradint;, the ,t\uthority will rcimbursc Rcdcvelopcr for such costs up to a maximum of $ , \vithin 30 days aftcr rcccipt of a writtcn rcqucst accompanied by invoices, paid or payable, in u form reasonably :;ati:;faetory to Authority: strinninl! ton soil ner borinl! 10l!s: exnortin!! excess tonsoil off site to an area desil!nated bv Citv's consultinl! enl!ineer WSB & Associates. Inc. ("WSW'): cuttinl! existinl! hil!h areas and fillin!! low areas with existinl! suitable matcrial (but assuminl! no imDort of material from off-site); all accordinl! to nlans annroved bv WSB. General Gradinl! does not include additional fill work described in naral!raoh (c) below. (c) After Closinl!. Redeveloner may transnort "Excess Sand" from a Citv-owned site adiacent to the Redcvclonmcnt Prooertv. for use as additional fill material for the Redevelooment Pronertv. The term "Excess Sand" means any amount of sand not needed bv the Citv for othcr ournoses. as determined bv WSB. Redeveloner must nay all costs of transnortinl! the sand. but will not be charl!ed any other fee for the nurchase of the sand. (e!,1) The Redeveloper acknowledges that the Authority makes no representations or warranties as to the condition of the soils on the Redevelopment Property or its fitness for construction of the Minimum Improvements or any other purpose for which the Redeveloper may make use of such property. The Redeveloper further agrees that it will indemnify, defend, and hold harmless the Authority, the City, and their governing body members, onicers, and employees. from any claims or actions arising out of the presence, if any, of hazardous wastes or pollutants on the Redevelopment Property. Section 3.7. Advance of Land and other Costs; Tax Increment Interfund Loan. (a) The Authority has determined that the fair market price of the Redevelopment Property is $998,933, or $2.65 per square foot. This price represents the total invested or to bcinvested by the Authority or City in making the Redevelopment Property available for commercial development, including the value of the raw land and all costs of special assessments for infrastructure, City trunk fees (except those paid by Redeveloper under Section 3.3), park dedication, general grading, platting, administrative and holding costs. As described in Section 3.2 hereof, the purchase price for conveyance of the Redevelopment Property represents a reduction from the hlir market price from $2.65 per square f(Jot to $.95 per square foot for a five-acre portion of the Redevelopment Property, and a reduction from $2.65 per square foot to $2,15 per square foot for a 3.65 acre portion of the Redevelopment Property. Therefore, at Closing the Authority will forgo receipt the full market price of the Redevelopment Property, which represents an advance of Authority funds in the amount of $449,838, less the amount paid by Redeveloper f(n City trunk fees in the amount of $37,914, for a net advance of $411 ,924. In addition. thc Authoritv will Dav an estimated amount of $27.300 to remove the dirt stocknilc on the Redevclonment Proncrtv under Section 3.6(C). which amount renresents an additional advance of funds for the benefit of Rcdcvclooer. (b) The Authority will treat the advance described in paragraph (a) as an interfund loan (the "Intcrfund Loan") within the meaning of Section 469.178, Suhdivision 7 of the TIF Act. The total original principal amount of the Interfund Loan is $111,921.139.224. The terms of the Interfund Loan are described in the resolution attached as Schedule C (the "Loan 5JI.I-26630Xv3 MN190-121 10 . . . Resolution"). The Authority will pledge Available Tax Increment, as defined in the Loan Resolution, to payment of the Interfund Loan. The Redeveloper has no rights or interest in any Tax Increment. Section 3.8. Business Subsidy Af;!.reement. The provisions of this Section constitute the "business subsidy agreement" for the purposes of the Business Subsidy Act. (a) General Terms. The parties agree and represent to each other as follows: (I) The subsidy provided to the Redeveloper consists of the principal amount of the Interfund Loan described in Section 3.7. The Interfund Loan is payable from a portion of the Tax Increments from the 'TIF District, an economic development tax increment financing district. (2) The public purposes of the subsidy are to facilitate development of the Authority's industrial park, increase net jobs in the City and the State, and increase the tax base of the City and the State. (3) The goals fix the subsidy are: to secure development of the Minimum Improvements on the Redevelopment Property; to maintain such improvements as a distribution facility for the time period described in clause (6) below; and to create the jobs and wage levels in accordance with Section 3.8(b) hereof. (4) If the goals descrlbedin clause (3) are not met, the Redeveloper must make the payments to the Authority described in Section 3.8(c). (5) The subsidy is needed to induce Redeveloper to locate its business at this site, and to mitigate the east of assessments for public infrastructure, all as determined by the Authority upon approval of the TIF Plan. (6) The Redeveloper must continue operation of the Minimum Improvements as a "Qualified Facility" for at least five years after the Benefit Date (defined hereinafter), subject to the continuing obligation described in Section 10.3 of this Agreement. For the purposes of this Section, the term Qualified Facility means a distribution, warehouse or manufacturing facility, ineluding office space necessary for and related to those activities, all within the meaning of Section 469.176, subd. 4c of the TIF Act. The improvements will be a Qualified Facility as long as the Minimum Improvements are operated by Rcdevcloper or a tenant for the aforementioned qualified uses. During any period when the Minimum Improvements are vacant and not operated for the aforementioned qualified uses, the Minimum Improvements will not constitute a Qualified Facility. (7) The Redeveloper docs not have a parent corporation. (8) The Redeveloper has not received, and does not expect to receive, financial assistance from any other "grantor" as defined in the Business Subsidy Act, in connection with the Dcvelopment Property or the Minimum Improvements. SJB-2663()Xv3 MNI9()-121 11 . . . (b) Job and Wage Goals. The "Benefit Date" of the assistance provided in this Agreement is the earl ier of the date of issuance of eompletion of the Minimum Improvements or the date the Minimum Improvements arc occupied by Redeveloper or a tenant of Redeveloper. Within two years after the Benefit Date (the "Compliance Date"), the Redeveloper shall (i) retain at least 28 full-time equivalentoermancnt jobs permanent to the Redevelopment Property from another location in the City, (ii) cause the average hourly wage of the 28 retained jobs to be at least $20.21 per hour, exclusive of benefits; (iii) cause to be created at least three new full-time permanent jobs on the Redevelopment Property (above and beyond the 28 retained jobs); and (iv) cause the average hourly wage of the three new jobs to be $19.90 per hour, exclusive of benefits. Jobs created by any tenants within the Minimum Improvements will count toward the requirements of this Section. Notwithstanding anything to the contrary herein, if the wage and job goals described in this paragraph are met by the Compliance Date, those goals are deemed satisfied despite the Developer's continuing obligations under Sections 3.8(a)(6) and 3.8(d). The Authority may, after a public hearing, extend the Compliance Date by up to one year, provided that nothing in this section will be construed to limit the Authority's legislative discretion regarding this matter, (c) Remedies, If the Redeveloper fails to meet the goals described in Section 3.8(a)(3), the Redeveloper shall repay to the Authority upon written demand from the Authority a "pro rata share" of the to the Redeveloperoutstandinf!" nrincinal amount of the Interfund Loan together with interest on that amount at the implicit price det1ator as defined in Minnesota Statutes, Section 275.50, subd. 2, accrued from the date of substantial completion of the Minimum Improvements to the date of payment. The term "pro rata share" means percentages caleulated as f()lIows: (i) if the h:lilure relates to the number of jobs, the jobs required less the jobs created, divided by the jobs required; (ii) if the failure relates to wages, the number of jobs required less the number of jobs that meet the required wages, divided by the number of jobs required; (iii) if the failure relates to maintenance of the t~lcility as a Qualified Facility in accordance with Section 3.8(a)(6), 60 less the number of months of operation as a Qualified facility (where any month in which the Qualified Facility is in operation for at least 15 days constitutes a month of operation), commencing on the Benefit Date and ending with the date the Qualified facility ceases operation as determined by the Authority Representative, divided by 60; and (iv) if more than one of clauses (i) through (iii) apply, the sum of the applicable percentages, not to exceed 100%. Nothing in this Section shall be construed to limit the Authority's remedies under Article IX hereof. In addition to the remedy described in this Section and any other remedy available to the Authority t()r failure to meet the goals stated in Section 3.8(a)(3), the Redeveloper agrees and understands that it may not a receive a business subsidy from the Authority or any grantor (as ,;m.266308v3 MN190-121 12 . . . defined in the Business Subsidy Act) for a period of five years from the date of the failure or until the Redeveloper satisfies its repayment obligation under this Section, whichever occurs fi rst. (d) Reports. The Redeveloper must submit to the Authority a written report regarding business subsidy goals and results by no later than February I of each year, commencing February 1, :w462007 and continuing until the later of (i) the date the goals stated Section 3.8(a)(3) are met; (ii) 30 days after expiration of the period described in Section 3.8(a)(6); or (iii) if the goals arc not met, the date the subsidy is repaid in accordance with Section 3.8(c). The report must comply with Section 116.1.994, subdivision 7 of the Business Subsidy Act. The Authority will provide information to the Redeveloper regarding the required forms. If the Redeveloper t~:Iils to timely file any report required under this Section, the Authority will mail the Redeveloper a warning within one week after the required filing date. If, after 14 days of the postmarked date of the warning, the Redeveloper bils to provide a report, the Redeveloper must pay to the Authority a penalty of $100 for each subsequent day until the report is filed. The maximum aggregate penalty payable under this Section $1,000. Section 3.9. Payment of Administrative Costs. The Authority acknowledges that upon execution of the Preliminary Agreement, Redeveloper has deposited with the Authority $10,000. The Authority will use such deposit to pay "Administrative Costs," which term means out of pocket costs incurred by the Authority and City together with staff costs of the Authority and City, all attributable to or incurred in connection with the negotiation and preparation of the Preliminary Agreement, this Agreement, the TIF Plan, and other documents and agreements in connection with the development of the Redevelopment Property. At Redeveloper's request. but no more often than monthly, the Authority will provide Redeveloper with a written report including invoices, time sheets or other comparable evidence of expenditures for Administrative Costs and the outstanding balance of funds deposited. If at any time the Authority determines that the deposit is insufficient to pay Administrative Costs, the Redeveloper is obligated to pay such shortfall within 15 days after receipt of a written notice from the Authority containing evidence of the unpaid costs. If any balance of funds deposited remains upon issuance of the Certificate of Completion pursuant to Section 4.4 of this Agreement, the Authority shall promptly return such balance to Redeveloper; provided that Redeveloper remains obligated to pay subsequent Administrative Costs related to any amendments to this Agreement requested by Redeveloper. Upon termination of this Agreement in accordance with its terms, the Redeveloper remains obligated under this section for Administrative Costs incurred through the effective date of termination. (The remainder of this page is intentionally left blank.) S.IB-26(>30Xv3 MNI9()-121 13 . . . ARTICLE IV Construction of Minimum Improvements Section 4.1. Construction of Minimum Improvements. The Redeveloper agrees that it will construct the Minimum Improvements on the Redevelopment Property in accordance with the approved Construction Plans and will operate and maintain, preserve and keep the Minimum Improvements or cause the Minimum Improvements to be maintained, preserved and kept with the appurtenances and every part and parcel thereof, in good repair and condition. Section 4.2. Construction Plans. (a) Before closing on conveyance of the Redevelopment Property under Article Ill, the Redeveloper shall submit to the Authority completed Construction Plans. The Construction Plans shall provide for the construction of the Minimum Improvements and shall be in conformity with the Otter Creek Crossing Declaration, the Redevelopnlent Plan, the TIF Plan, this Agreement, and all applicable State and local laws and regulations. The Authority will approve the Construction Plans in writing if: (i) the Construction Plans conform to the terms and conditions of this Agreement; (ii) the Construction Plans conform to the goals and objectives of the Otter Creek Crossing Oeelaration and the Redevelopment Plan; (iii) the Construction Plans conform to all applicable federal, state and local laws, ordinances, rules and regulations; (iv) the Construction Plans are adequate to provide for construction of the Minimum Improvements; (v) the Construction Plans do not provide for expenditures in excess of the funds available to the Redeveloper for construction of the Minimum Improvements; and (vi) no Event of Default has occurred. No approval by the Authority shall relieve the Redeveloper of the obligation to comply with the terms of this Agreement or of the Redevelopment Plan, applicable federal, state and local laws, ordinances, rules and regulations, or to construct the Minimum Improvements in accordance therewith. No approval by the Authority shall constitute a waiver of an Event of Default. If approval of the Construction Plans is requested by the Redeveloper in writing at the time of submission, such Construction Plans shall be deemed approved unless rejected in writing by the Authority, in whole or in patio Such rejections shall set f()rth in detail the reasons thereflHe, and shall be made within 30 days aHer the date of their receipt by the Authority. If the Authority rejects any Construction Plans in whole or in part, the Redeveloper shall submit new or corrected Construction Plans within 30 days after written notification to the Redeveloper of the rejection. The provisions of this Section relating to approval, rejection and resubmission of corrected Construction Plans shall continue to apply until the Construction Plans have been approved by the Authority. The Authority's approval shall not be unreasonably withheld. Said approval shall constitute a conclusive determination that the Construction Plans (and the Minimum Improvements, constructed in accordance with said plans) comply to the Authority's satisfnction with the provisions of this Agreement relating thereto. (en) If thc Redeveloper desires to make any material change in the Construction Plans after their approval by the Authority, the Redeveloper shall sublnit the proposed change to the Authority fiJr its approval. If the Construction Plans, as modified by the proposed change, conform to the requirements of this Section 4.2 of this Agreement with rcspect to such previously approved Construction Plans, thc Authority shall approve the proposed change and SJH-26630Xv3 MN190-121 14 . . . notify the Redeveloper in writing of its approval. Such change in the Construction Plans shall, in any event, be dcemed approved by the Authority unless rejeetcd, in whole or in part, by written notice by the Authority to the Redeveloper, setting forth in detail the reasons therefor. Sueh rejection shall be madc within ten (10) days after receipt of the notiee of such change. The Authority's approval of any such change in the Construction Plans will not be unreasonably withheld. Section 4.3. Commeneement and Completion of Construction. Subject to Unavoidable Delays, the Redeveloper must commence construction of the Minimum Improvements by no later than 30 days after Closing on conveyance of the Redevelopment Property. Subject to Unavoidable Delays, the Redeveloper must substantially complete construction of the Minimum Improvements by December 31, 2005.Mav 1. 2006. All work with respect to the Minimum Improvements to be constructed or provided by the Redeveloper on the Redevelopment Property shall be in conformity with the Construction Plans as submitted by the Redeveloper and approved by the Authority. Notwithstandinl! anvthinl! to the contrary herein. Redeveloncr acknowlcdl!es that the minimum market value of the Redevelonment Prooertv snecitied in the Assessment Al!reement under Section 6.3 will be effective as of .January 2. 2006. rel!ardless of the state of comolction of the Minimum I mnrovements as of that date. The Redeveloper agrees for itself, its successors and assigns, and every succcssor in interest to the Redevelopment Property, or any part thereof, that the Redeveloper, and such successors and assigns, shall promptly begin and diligently prosecute to completion the redevelopment of the Redevelopment Property through the construction of the Minimum Improvements thereon, and that such construction shall in any event be commenced and completed within the period specified in this Section 4.3 of this Agreement. Subsequent to conveyance of the Redevelopment Property, or any part thereof~ to the Redeveloper, and until construction of the Minimum Improvemcnts has been completed, the Redeveloper shall make reports, in such detail and at such times as may reasonably be requested by the Authority, as to the actual progress ofthc Redevcloper with respect to such construction. Section 4.4. Certificate of Completion. (a) Promptly after substantial completion of the Minimum Improvements in accordance with those provisions of the Agreement relating solely to the obligations of the Redeveloper to construct the Minimum Improvements (including the dates fl)r beginning and completion thcrcof), the Authority will furnish the Redeveloper with a Certificate of Completion in substantially the form provided in Schedule D.. Such certi fication by the Authority shall be (and it shall be so provided in the dced and in the certification itself) a conclusive determination of satisfaction and termination of the agreements and covenants in the Agreement and in the deed with respect to the obligations of the Redeveloper, and its successors and assigns, to construct the Minimum Improvements and the dates for the beginning and complction thereof. Such certification and such determination shall not constitute evidence of compliance with or satisfaction of any obligation of the Redeveloper to any Holder of a Mortgage, or any insurer of a Mortgage, securing money loaned to finance the Minimum Improvemcnts, or any part thereof. (b) The certificate provided for in this Section 4.4 of this Agreement shall be in such form as will enable it to be recordcd in the propcr officc for the recordation of deeds and other SJB-266J08v3 MN I (JO~ 121 15 . . . instruments pertaining to the Redevelopmcnt Property. If the Authority shall refuse or fail to provide any certification in accordance with the provisions of this Section 4.4 of this Agreement, the Authority shall, within thirty (30) days after written request by thc Redeveloper, providc the Redeveloper with a written statement, indicating in adequate detail in what respects the Redeveloper has failed to complete the Minimum Improvements in accordance with the provisions of the Agreement, or is otherwise in default, and what measures or acts it will be necessary, in the opinion of the Authority, for thc Redeveloper to take or perform in order to obtain such certification. (c) The construction of the Minimum Improvements shall be deemed to be commenced upon heginning of excavation flW the building, and shall be deemed to bc suhstantially completed whcn the Redeveloper has received a certificate of occupancy issued by the City for the Minimum Improvements. (The remainder of this page is intentionally left blank.) SJR-2h6308v3 MNI<,lO-I2I 16 . . . ARTICLE V Insurance Section 5.1. Insurance. The Rcdeveloper will provide and maintain at all times during the proccss of constructing the Minimum Improvements an All Risk Broad Form Basis Insurance Policy and, from time to time during that period, at the request of the Authority, furnish the Authority with proof of payment ofprcmiums on policies covering the following: (i) Builder's risk insurance, written on the so-called "Builder's Risk -- Completed Value Basis," in an amount equal to one hundred percent (lOO(1(l) of the insurable value of the Minimum Improvements at the date of completion, and with coveragc available in nonreporting form on the so-called "all risk" form of policy. The interest of the Authority shall be protected in accordance with a clause in form and content satist~lctory to the Authority; (ii) Comprehensive general liability insurance (including operations, contingent liability, operations of subcontractors, completed operations and contractual liability insurance) together with an Owner's Contractor's Policy with limits against bodily injury and property damage of not less than $1,000,000 for each occurrence (to accomplish the above-required limits, an umbrella excess liability policy may be used); and (iii) Workers' compensation insurance, with statutory coverage. (b) Upon completion of construction of the Minimum Improvements and prior to the Termination Date, the Redeveloper shall maintain, or cause to be maintained, at its cost and expense, and from time to time at the request of the Authority shall furnish proof of the payment of premiums on, insurance as follows: (i) Insurance against loss and/or damagc to the Minimum Improvements under a policy or policies covering such risks as arc ordinarily insured against by similar businesses. (ii) Comprehcnsive general public liability insurance, including personal injury liability (with cmployee exclusion deletcd), against liability for injuries to persons and/or property, in the minimum amount for each occurrence and for cach year of $1,000,000, and shall he endorsed to show the City and Authority as additional insureds. (iii) Such other insurance, including workers' compensation insurance respecting all employees of the Redeveloper, in such amount as is customarily carricd by like organizations engaged in like activities of comparable size and liability exposure; provided that thc Redeveloper may be self-insured with respect to all or any part of its liability for workers' compensation. SJH-26630Xv3 MNI<,l().121 17 . . . (c) All insurance required in Article V of this Agreement shall be taken out and maintained in responsible insurance companies selected by the Redevelopcr that are authorized under the laws of the State to assume the risks covercd thereby. Upon request, the Redeveloper will deposit annually with the Authority policies evidencing all such insurance, or a certificate or certificates or binders of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Article V of this Agreement each policy shall contain a provision that the insurer shall not cancel nor modify it in such a way as to reduce the coverage provided below the amounts required herein without giving written notice to the Redeveloper and the Authority at least 30 days before the cancellation or modification becomes effective. In lieu of separate policies, the Rcdeveloper may maintain a single policy, blanket or umbrella policies, or a combination thereot~ having the coverage required herein, in which event the Redeveloper shall deposit with the Authority a certificate or certificates of the respective insurers as to the amount of coverage in force upon the Minimum Improvements. (d) The Redeveloper agrees to notify the Authority immediately in the case of damage exceeding $100,000 in amount to, or destruction of, the Minimum Improvements or any portion thereof resulting from fire or other casualty. In such event the Redeveloper will forthwith repair, reconstruct, and restore the Minimum Improvements to substantially the same or an improved condition or value as it existed prior to the event causing such damage and, to thc extent necessary to accomplish such repair, reconstruction, and restoration, the Redeveloper will apply the net proceeds of any insurance relating to such damage received by the Redeveloper to the payment or reimbursement of the costs thereof. The Redeveloper shall complete the repair, reconstruction and restoration of the Minimum Improvements, regardless of whether the net proceeds of insurance received by the Redeveloper Cor such purposes are sufficient to pay for the same. Any net proceeds remaining after completion of such repairs, construction, and restoration shall be the property of the Redeveloper. (e) In lieu of its obligation to reconstruct the Minimum Improvements as set forth in this Seetion, the Redeveloper shall have the option of paying to the Authority an amount that, in the opinion of the Authority and its fiscal consultant, is sunicient to pay in full the outstanding principal and accrued interest on the Interfund Loan. (1) The Redeveloper and the Authority agree that all of the insurance provisions set forth in this Article V shall terminate upon the termination ofthis Agreement. Section 5.2. Subordination. Notwithstanding anything to the contrary contained in this Article V, the rights of the Authority with respect to the receipt and application of any proceeds of insurance shall, in all respects, be subject and subordinate to the rights of any lender under a Mortgage approved pursuant to Article V II of this Agreement. (The remainder oCthis page is intentionally left blank.) SJB-266308v3 MN 190-121 18 . . . ARTICLE VI DelinQuent Taxes and Review of Taxes Section 6.1. Right to Colleet Delinquent Taxes. Redeveloper agrees for itsel1~ its successors and assigns, in addition to the obligation pursuant to statute to pay real estate taxes, that it is also obligated by reason of this Agreement to pay before delinquency all real estate taxes assessed against the Redevelopment Property and the Minimum Improvements. The Redeveloper acknowledges that this obligation creates a contractual right on behalf of the Authority through the Termination Date to sue the Redeveloper or its suecessors and assigns to collect delinquent real estate taxes and any penalty or interest thereon and to pay over the same as a tax payment to the county auditor. In any such suit in which the Authoritv is the nrevailinl! nartv, the Authority shall also be entitled to recover its costs, expenses and reasonable attorney fees. Section 6.2. Review of Taxes. The Redeveloper agrees that prior to the 'l"ermination Date it will not cause a reduction in the real property taxes paid in respect of the Redevelopment Property through: (a) willful destruction of the Redevelopment Property or any part thereof; or (b) willful refusal to reconstruct damaged or destroyed property pursuant to Section 5.1 of this Agreement, except as otherwise provided in Section 5.1 (e). The Redeveloper also agrees that it will not, prior to the Termination Date, apply for a deferral of property tax on the Redevelopment Property pursuant to any law, or transfer or permit transfer of the Redevelopment Property to any entity whose ownership or operation of the property would result in the Redevelopment Property being exempt from real estate taxes under State law (other than any portion thereof dedicated or conveyed to the City or Authority in accordance with this Agreement). Section 6.3. Assessment Agreement. (a) Upon closing on conveyance of the Redevelopment Property to the Redeveloper under Article III hereof, the Redeveloper shall, with the Authority, execute an Assessment Agreement pursuant to Minnesota Statutes, Section 469.177, subd. 8, specifying an assessor's minimum Market Value for the Redevelopment Property and Minimum Improvements constructed thereon. The amount of the minimum Market Value shall be $2,900,000 as of January 2, 2006 and each January 2 thereafter, notwithstanding the status of construction by such dates. (b) The Assessment Agreement shall be substantially in the f()rm attached hereto as Schedule E. Nothing in the Assessment Agreement shall limit the discretion of the assessor to assign a market value to the property in excess of such assessor's minimum Market Value. The Assessment Agreement shall remain in force for the period specifiecl in the Assessment Agreement. (The remainder of this page is intentionally left blank.) S.I B - 2663 OS v J MN190-121 20 . ARTICLE VII Financinf! Section 7.1. Financing. (a) Before convcyance of the Redevelopment Property, the Redeveloper shall submit to the Authority evidence of one or more commitments for mortgage financing which, together with committed equity for such construction, is sufficient f()r the construction of the Minimum Improvements. Such commitments may be submitted as short term financing, long term mortgage financing, a bridge loan with a long-term take-out financing commitment, or any combination of the foregoing. Such commitment or commitments for short term or long term mortgage financing shall be subject only to such conditions as arc normal and customary in the mortgage banking industry. Notwithstandinf! anvthinf! to the contrarv herein. the Authoritv acknowledf!es that Redeveloner's "resent intent is to finance aCQuisition of the Redevelonment Pro"ertv and construction of the Minimum Imnrovements with eQuitv. As evidence of sufficiency of eQuitv. Redeveloner shall submit a written renresentation from its title comnanv showinf! that Redevcloner has denosited funds sufficient to nay the nurchase nrice for the Redevelonment Pronertv and to construct the Minimum Imnrovements. . (b) If the Authority finds that the eouitv (or mortgage financing. if any) is sufficiently committed and adequate in amount to provide for the construction of the Minimum lmprovcments, then the Authority shall notify the Redeveloper in writing of its approval. Such approval shall not be unreasonably withheld and either approval or rejection shall be given within thirty (30) days from the date when the Authority is provided the evidence of mortgage financing. A f~li lure by the Authority to respond to such evidence of mortgage financing shall be deemed to constitute an approval hereunder. If the Authority rejects the evidence of mortgage financing as inadequate, it shall do so in writing specifying the basis for the rejection. In any cvent the Redevcloper shall submit adequate evidence of m0l1gage financing within thirty (30) days after such rejection. Approval of any subordination agreement under Section 7.3 hereof will constitute approval of financing for the purposes of this Section. (c) If any nortion of the cost is financed with mortf!af!e financinf! rather than eouitv. By no later than the required date f()r Closing under Section 3.3(b) hereof: Redeveloper shall close on the financing approved under this Section. Such closing shall he evidenced by execution of loan and related seeurity documcnts. . Section 7.2. Authority's Option to Cure Debult on Mortgage. In the event that there oeeurs a default under any Mortgage authorized pursuant to Article VII of this Agreement. the Redeveloper shall cause the Authority to receive copies of any notice of default received by the Redeveloper from the holder of such Mortgage. Thereafter, the Authority shall have the right, but not the obligation, to cure any such default on behalf of the Redeveloper within sLlch cure periods as are available to the Redeveloper under the Mortgage documents. In the event there is an event of def~lult under this Agreement, the Authority will transmit to the llolder of any Mortgage a copy of any notice of default given by the Authority pursuant to AI1icle IX of this Agreement. SJB-211I1JOSv.1 MN190-121 21 . . . Section 7.3. Subordination and ModiJication for the Benefit of Mortgagee. In order to facilitate the Redeveloper obtaining financing for purchase of the Redevelopment Property and for construction according to the Construction Plans, the Authority agrees to subordinatc its rights under this Agreement, including without limitation its rights of reversion under Sections 9.3 and 9.4 hereoC provided that (a) such subordination shall be subject to such reasonable terms and conditions as the Authority and Holder mutually agree in writing, (b) the Authority's obligation to subordinate is contingent on the Authority's approval of the financing in accordance with Section 7.1 hereof, and (c) in no event will the Authority subordinate its rights under thc Assessment Agrecment described in Section 6.3. (The remainder of this page is intentionally left blank.) sm-2M308vJ MN190-121 22 . . . ARTICLE VIII Prohibitions A2ainst Assil!nment and Transfer; Indemnification Section 8.1. Representation as to Redevelopment. The Redeveloper represents and agrees that its purchase of the Redevelopment Property or portions thereot~ and its other undertakings pursuant to the Agreement, are, and will be used, for the purpose of redevelopment of the Redevelopment Property and not for speculation in land holding. Section 8.2. Prohibition Against Redeveloper's Transfer of Property and Assignment of Agreement. The Redeveloper represents and agrees that until the Termination Date: (a) Except only by way of security fiJr, and only for, the purpose of obtaining financing necessary to enable the Redeveloper or any successor in interest to the Redevelopment Property, or any part thereoC to perform its obligations with respect to making the Minimum Improvements under this Agreement, and any other purpose authorized by this Agreement, the Redeveloper has not made or creatcd and will not make or create or suiTer to be made or created any total or partial sale, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to the Agreement or the Redevelopment Property or any part thcreof or any interest therein, or any contract or agreement to do any of the same, without the prior written approval of the Authority unless the Redeveloper remains liable and bound by this Redcvclopment Agreement in which event the Authority's approval is not required. Any such transfer shall be subject to the provisions of this Agreement. Notwithstanding anything to the contrary herein, the Authority consents to any assignment or transfer by Redeveloper to Commercial Partners Exchange Company, I J ,C and/or its nominee Rocky MountainMtn Exchange Holding Company 25254, LtC. and anv subseuuent transfer back to Rockv Mtn Groun. LLC. The Authority furthcr agrces that the permitted assignee of Redeveloper may, upon execution of this Agreement, substitute or replace the deposit made under the Preliminary Agreement in the same amount as deposited by Redeveloper and Authority will promptly deliver the deposit madc by Redeveloper to Rocky Mountain Group, -h-!--,-G-;-Mtn Groun. LLC. The Authoritv understands and aeknowledl!es that Redeveloner intends to lease the Redevelonment Pronertv to Dahlheimer Distributinl! Co.. Inc. ("'Dahlheimer"). The Authoritv consents to such lease. nrovided that such consent will not be construed to relieve Redeveloner from its oblil!ations under this Al!reement or to imDose anv oblil!ations under this on Dahlheimer. (b) In the event the Redcveloper, upon transfer or assignment of the Rcdevelopment Property or any portion thcrcof, seeks to be released from its obligations under this Redevelopment Agreement as to the portions of the Redevelopment Property that is transferred or assigncd, thc Authority and City shall be entitled to require, cxccpt as otherwise provided in the Agreement, as conditions to any such release that: (i) Any proposed transferee shall have the qualifications and financial responsibility, in the reasonable judgment of the Authority and City, necessary and adequate to fulfill the obligations undertaken in this Agrcement by the Redeveloper as to the portion of the Redevelopment Property to be transferrcd. SJB-266308v3 MN190-121 23 . (ii) Any proposed transferee, by instrument in wntmg satisfactory to the Authority and in form recordable among the land records, shall, for itself and its successors and assigns, and expressly for the benefit of the Authority and City, have expressly assumed all of the obligations of the Redeveloper under this Agreement as to the portion of the Redevelopment Property to be transferred and agreed to be subject to all the conditions and restrictions to which the Redeveloper is subject as to sueh portion; provided, however, that the tact that any transferee of, or any other sueeessor in interest whatsoever to, the Redevelopment Property, or any part thereof, shall not, for whatever reason, have assumed such obligations or so agreed, and shall not (unless and only to the extent otherwise specifically provided in this Agreement or agreed to in writing by the Authority and the City) deprive the Authority and or City of any rights or remedies or controls with respect to the Redevelopment Property or any part thereof or the construction of the Minimum Improvements; it being the intent of the parties as expressed in this Agreement that (to the fullest extent permitted at law and in equity and excepting only in the manner and to the extent specifically provided otherwise in this Agreement) no transfer 01~ or change with respect to, ownership in the Redevelopment Property or any part thereof~ or any interest therein, however consummated or occurring, and whether voluntary or involuntary, shall operate, legally or practically, to deprive or limit the Authority of or with respect to any rights or remedies on controls provided in or resulting from this Agreemcnt with respect to the Minimum Improvements that the Authority would have had, had there been no such transfcr or change. In the absence of specific written agreement by the Authority and the City to the contrary, no such transfer or approval by the Authority and the City thereof shall be deemed to relieve the Redeveloper, or any other party bound in any way by this Agreement or otherwise with respect to the construction of the Minimum Improvements, from any of its obligations with respect thereto. . (iii) Any and all instruments and other legal documents involved in effecting the transfer of any interest in this Agreement or the Redevelopment Property governed by this Article VIII, shall be in a form reasonably satisfactory to the Authority and the City. In the event the foregoing conditions are satisfied then the Redeveloper shall be released from its obligation under this Agreement, as to the portion of the Redevelopment Property that is transferred, assigned or otherwise conveyed. Section g.3. Release and Indemnification Covenants. (a) 'fhe Redevelopcr releases from and covenants and agrees that the Authority and the City and the governing body members, officers, agents, servants and employees thereof shall not be liable for and agrees to indemnify and hold harmless the Authority and the City and the governing body members, officers, agents, servants and employees thereof against any loss or damage to property or any injury to or death of any person occurring at or about or resulting from any defect in the Minimum Improvements. (b) Except for any willful misrepresentation or any willful or wanton misconduct of the following named parties, the Redeveloper agrees to protect and defend the Authority and the . City and the governing body members, officers, agcnts, servants and employees thereof, now or SJ U.26630Xv3 MN190-121 24 . . . flJrever, and further agrees to hold the aforesaid harmless from any claim, demand, suit, action or other proceeding whatsoever hy any person or entity whatsoever arising or purportedly arising from this Agreement, or the transactions contemplated hereby or the acquisition, construction, installation, ownership, and operation of the Minimum Improvements. (c) The Authority and the City and the governing hody members, officers, agents, servants and employees thereof shall not be liable for any damage or injury to the persons or property of the Redeveloper or its onicers, agents, servants or employees or any other person who may he about the Redevclopment Property or Minimum Improvements due to any act of negligence of any person. (d) All covenants, stipulations, promises, agreements and obligations of the Authority contained herein shall be deemed to be the eovenants, stipulations, promises, agreements and obligations of the Authority and not of any governing body member, onicer, agent, servant or employee of the Authority in the individual capacity thereof. (The remainder of this page is intentionally left blank.) SJ 1l-26630Rv3 MNI9()-121 25 . . . ARTICLE IX Events of Default Section 9.1. Events of Default Defined. The following shall be "Events of Default" under this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement (unless the context otherwise provides);-,!, ~any bilure by any party to observe or perform any other covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement or under any other agreement entercd into between the Redeveloper and the Authority or City in connection with developmcnt of the Redevclopment Property~ (b) any default bv Redeveloner under a Mort~a~e. if any. Section 9.2. Remedies on Default. Whenever any Event of Default referred to in Section 9.1 of this Agreement occurs, the non-defaulting party may exercise its rights under this Section 9.2 after providing thirty days written notice to the defaulting party of the Evcnt of Default, but only if the Event of Dcfault has not been cured within said thirty days or, if the Event of Default is by its nature incurable within thirty days, the defaulting party does not provide assurances reasonably satisfactory to the non-def~lulting party that the Event of Default will be cured and will be cured as soon as reasonably possible: (a) Suspend its performancc under the Agreement until it receives assurances that the dcfaulting party will cure its dcfault and continue its performance under the Agreement. (b) Cancel and rescind or terminate the Agreement. (c) "fake whatever action, including legal, equitable or administrative action, which may appcar necessary or desirable to collect any payments due under this Agreement, or to enforce perft1rtnanee and obscrvanee of any obligation, agreement, or covenant undcr this Agreement. (d) Notwithstanding anything to the contrary herein, in the case of defaults by Redeveloper described in Section 3.8, the Authority has thc additional rcmedies specified therein, subject to the qualification describcd in Section 10.3. Section 9.3. Revesting Title in Authority Upon Happening of Evcnt Subse<"lUcnt to Conveyancc to Redcveloper. In the event that subsequcnt to conveyance of the Redevclopment Propcrty to the Redevcloper and prior to receipt by the Redeveloper of the Certificate of Completion for the Minimum Improvements required to be constructed on that parcel: (a) the Redeveloper, subject to Unavoidable Delays, shall fail to begin construction of the Minimum Improvements in conformity with this Agreement and such failure to bcgin SJl3-26(,JOXv3 MN 190-121 26 . construction is not cured within 90 days after written notice from the Authority to the Redeveloper to do so; or (b) subject to Unavoidable Delays, the Redeveloper after commencement of the construction of the Minimum Improvements, fails to carry out its obligations with respect to the construction of such improvements (including the nature and the date f()r the completion thereof), or abandons or substantially suspends construction work, and any such failure, abandonment, or suspension shall not be cured, ended, or remedied within 90 days after written demand from the Authority to the Rcdeveloper to do so; or (c) thc Redeveloper fails to pay real estate taxes or assessments on the parcel or any part thcreof when due, or creates, suffers, assumes, or agrees to any encumbrance or lien on the parccl (except to the extcnt permitted by this Agreement), or shall suffer any levy or attachment to be made, or any materialmcn's or mechanics' lien, or any other unauthorized encumbrance or lien to attach, and such taxes or assessments shall not have been paid, or the encumbrance or lien removed or discharged or provision satisbctory to the Authority made for such payment, removal, or discharge, within thirty (30) days after written demand by the Authority to do so; provided, that if the Redcvelopcr first notifIes the Authority of its intention to do so, it may in good faith contest any mcchanics' or other lien tlled or established and in such event the Authority shall permit such mechanies' or other lien to remain undischarged and unsatisfied during the period of such contest and any appeal and during thc coursc of such contest the Redeveloper shall keep the Authority inflwmed respecting the status of such defense; or . (d) there is, in violation of the Agreemcnt, any transfer of the parcel or any part thcreof~ or any change in thc ownership or distribution thcreof of the Redcveloper, or with rcspect to the idcntity of the parties in control of the Redevelopcr or the dcgree thereof: and such violation is not cured within sixty (60) days after written demand by the Authority to the Redeveloper, or if the event is by its nature incurable within 30 days, the Redeveloper does not, within such 30-day period, provide assurances rcasonably satisfactory to the Authority that the cvent will be cured as soon as reasonably possible; or (e) the Redeveloper fails to comply with any of its other covenants under this Agrccment related to the subject component of thc Minimum Improvements and fails to cure any such noncompliancc or hrcach within thirty (30) days aftcr written demand from the Authority to the Rcdevcloper to do so, or if the evcnt is by its nature incurable within 30 days, the Redeveloper does not, within such 30-day period, provide assurances reasonably satisfactory to the Authority that the cvent will be curcd as soon as reasonably possible; or (f) thc Holdcr of any Mortgage secured by the subjcct property exerciscs any remedy provided by the Mortgage documents or exercises any rcmedy provided by law or cquity in the event of a deJault in any ofthc terms or conditions of the Mortgage, Then the Authority shall have thc right to re-entcr and take possession of the parcel and to tcrminatc (and rcvest in the Authority) the estate convcyed by thc deed to the Redcvelopcr, it being the intent of this provision, togethcr with other provisions of the Agreement, that the . conveyance of the parcel to the Redcveloper shall bc made upon, and that the deed shall contain SJB-266JOXv3 rvtN 190-121 27 . . . a condition subsequent to the effect that in thc cvent of any deI~lUlt on the part of the Rcdevcloper and b.ilure on the part of the Redeveloper to remedy, end, or abrogate such default within the period and in the manner stated in such subdivisions, the Authority at its option may deelare a termination in favor of the Authority of the title, and of all the rights and interests in and to the parcel conveyed to the Redeveloper, and that such title and all rights and intercsts of the Redeveloper, and any assigns or successors in interest to and in the parcel, shall revert to the Authority, but only if the events stated in Section 9.4(a)-(f) have not been cured within the time periods provided above. Section 9.4. Resale of Reacquired Propertv; Disposition of Proceeds. Upon the revesting in the Authority of title to and/or possession of the parcel or any part thereof as provided in Section 9.3, the Authority shall, pursuant to its responsibilities under law, use its best effi.)rts to sell the parcel or part thereof as soon and in such manner as the Authority shall find feasible and consistent with the objectives of such law and of the Redevelopment Plan and "I'I F Plan to a qualified and responsible party or parties (as determined by the Authority) who will assume the obligation of making or completing the Minimum Improvements or such other improvements in their stead as shall be satisfactory to the Authority in accordance with the uses specified ti.H such parcel or part thereof in the Redevelopment Plan and TIF Plan. During any time while the Authority has title to and/or possession of a parcel obtained by reverter, the Authority will not disturb the rights of any tenants under any leases encumbering such parcel. Upon resale of the parcel, the proceeds thereof shall be applied: (a) First, to reimburse the Authority for all costs and expenses incurred by them, including but not limited to salaries of personnel, in connection with the recapture, management, and resale of the parcel (but less any income derived by the Authority from the property or part thereof in connection with such management); all taxes, assessments, and water and sewer charges with respect to the parcel or part thereof (or, in the event the parcel is exempt tt'om taxation or assessment or such charge during the pcriod of ownership thereof by the Authority, an amount, if paid, equal to such taxcs, assessments, or charges (as determined by the Authority assessing official) as would have been payable if the parcel were not so exempt); any payments made or necessary to bc made to discharge any encumbrances or liens existing on the parcel or part thereof at the time of revcsting of title thereto in the Authority or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Redeveloper, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the subject improvements or any part thereof on the parcel or part thereof; and any amounts otherwise owing the Authority by the Redeveloper and its successor or transferee; and (b) Second, to reimburse the Redevelopcr, its successor or transferee, up to the amount equal to (1) the purchase price paid by Redeveloper under Section 3.2; plus (2) the amount actually invested by it in making any of the subject improvements on the parcel or part thereot~ less (2) any gains or income withdrawn or made by it from the Agreement or the parcel. Any balance rcmaining al'ter such reimbursemcnts shall be retained by the Authority as its property. SJH-26630XvJ MNI9()-I2I 28 . . . Section 9.5. No Remedv Exelusive. No remedy herein conferred upon or reserved to the Authority or Redeveloper 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. In order to entitle the Authority to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in this Artiele IX. Section 9.6. No Additional Waiver Implied bv One Waiver. In the event any agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previolls or subsequent breach hereunder. (The remainder of this page is intentionally left blank.) S.IIl-266308v3 MNIl)()-12! 29 . . . ARTICLE X Additional Provisions Section 10.1. Conflict of Interests; Authority Representatives Not Individually Liable. The Authority and the Redeveloper, to the best of their respective knowledge, represent and agree that no member, official, or employee of the Authority shall have any personal interest, direct or indirect, in the Agreement, nor shall any such member, official, or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership, or association in which he is, directly or indirectly, interested. No member, official, or employee of the Authority shall be personally liable to the Redeveloper, or any successor in interest, in the event of any default or hreach by the Authority or County or for any amount which may become due to the Redeveloper or successor or on any obligations under the terms of the Agreement. Section 10.2. Equal Employment Opportunity. The Redeveloper, for itself and its successors and assigns, agrees that during the construction of the Minimum Improvements provided for in the Agreement it will comply with all applicable federal, state and local equal employment and non-discrimination laws and regulations. Section 10.3. Restrictions on Use. The Redeveloper agrees that until the Termination Date, the Redeveloper, and such successors and assigns, shall use the Redevelopment Property and the Minimum Improvements thereon only as Qualified facility (as defined in Section 3.8 hereof), provided that after expiration of the five-year period described in Section 3.8(c), the repayment remedy described in Section 3.8(d) may not he imposed on Redeveloper for default under this Section, and Authority is limited to any other remedies available under Article IX hereof. further, until the Termination Date the Redeveloper shall not discriminatc upon the basis of race, color, creed, sex or national origin in the sale, lease, or rental or in the use or occupancy of the Redevelopment Property or any improvements erected or to be erected thereon, or any part thereof. Section 10.4. Provisions Not Merged With Deed. None of the provIsIons of this Agreement are intended to or shall be merged by reason of any dccd transferring any interest in the Redevelopment Property and any such deed shall not be deemed to afTect or impair the provisions and covcnants of this Agreement. Section 10.5. Titles of Articles and Scctions. Any titles of the several parts, Articles, and Sections of the Agreement are inserted f()f convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 10.6. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under the Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certificd mail, postage prepaid, return receipt requested, or delivered personally; and S.lLl-266J08v3 MNI9()-12i 80 . . . (a) in the case of the Redeveloper, is addressed to or delivered personally to the Redeveloper at Rocky MountainMtn Group, LLC, PO Box 336, Monticello, MN 55362, Attn: Gregory Dahlheimer; and (b) in the case of the Authority, is addressed to or delivered personally to the Authority at Housing and Redevelopment Authority in and for the City of Monticello, 505 Walnut Street, Suite 1, Monticello, Minnesota 55337, Attn: Executive Director; or at such other address with respect to either sueh party as that party may, from time to time, designate in writing and fiJrward to the other as provided in this Section. Section 10.7. Counterparts. This Agreement may be executed In any number of counterparts, each of which shall constitute one and the same instrument. Section 10.8. Recording. The Authority may record this Agreement and any amcndments thereto with the County recorder. The Redeveloper shall pay all costs for recording. Section 10.9. Amendment. This Agreement may be amended only by written agreement approved by the Authority and the Redeveloper. Section 10.10. Authority or City ADDrovals. Unless otherwise specified, any approval requircd by the Authority under this Agreement may be given by the Authority Representative. Section 10.11. Termination. This Agreement terminates on the Termination Date. Within 30 davs after the Termination Date. the Authoritv will deliver to Redeveloner a written release in recordable form satisfactorv to Redeveloner. evidencim! termimltion of this A!!reement. Section 10.12. Choice of Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the state of Minnesota. Any disputes, controversies, or claims arising out of this Agreement shall be heard in the state or federal courts of Minnesota, and all parties to this Agreement waive any objection to the jurisdiction of these courts, whether based on convenience or otherwise. (The remainder of this page is intentionally left: blank.) SJH-2663<mv3 MN 1')0-121 81 . . . IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf and its seal to be hereunto duly affixed and the Redeveloper has caused this Agrecment to be duly executed in its name and behalf on or as of the date first above written. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO ECONOMIC DEVELOPMENT .^.LJTHORITY By Its Chai r By Its Executive Director STATE OF MINNESOTA SS. COUNTY OF) The foregoing instrument was acknowledged before me this _ day of_ 2005, by and _____.____,_ , the Chair and Executive Director of the Housing and Redevelopment Authority in and for the City of Monticello, a public body politic and corporate, on behalf of thc Authority. Notary Public S.J Ll-26630~v3 M N 190-1 21 8-1 . . . ROCKY MOUNTAINM..IN GROUP, LLC By Its STATE Of' ) ) SS. ) COUNTY OF The forcgoing instrumcnt was acknowlcdged before me this _ day of , 2005 by ____ , thc_ of Rocky MountainMtn Group, LLC, a Minnesota limited liability company, on behalf of the company. Notary Public S.JB-266308v3 MNI<)O-121 8-2 . . . SCHEDULE A REDEVELOPMENT PROPERTY Lot 1, Block 1, Otter Creek Crossing 1 sl Addition, according to the rccorded plat thereof, Wright County, Minnesota SJIl-2(,(,J()8vJ MNI')()-121 A-I . . . SCHEDULE B FORM OF QlJIT CLAIM DEED TillS INDENTURE, bctwcen the Housing and Redevelopment Authority in and for the City of Monticello, Monticello, Minnesota, a public body corporate and politic (the "Grantor"), and Rocky MountainMtn Group, LLC, a Minnesota limitcd liability company, (the "Grantee"). WITNESSETH, that Grantor, in consideration of the sum of$__ and other good and valuable consideration the receipt whereof is hereby acknowlcdgcd, does hereby grant. bargain, quitclaim and convey to the Grantee, its successors and assigns forever, all the tract or parcel of land lying and being in the County of and State of Minnesota described as follows, to-wit (such tract or parcel of land is hereinafter referred to as the "Propcrty"): Lot I, Block 1, Otter Creek Crossing 1 Sl Addition, according to the recorded plat thereof, Wright County, Minnesota To have and to hold the same, togcthcr with all the hereditaments and appurtcnances thereunto belonging. SECTION I. It is understood and agrccd that this Deed is subject to the covcnants, conditions, rcstrictions and provisions of an agrccment recorded herewith entered into bctween the Grantor and Grantee on the day of , 2005, identificd as "Purchase and Redevelopment Contract" (hereafter referred to as the "Agreement") and that the Grantee shall not convcy this Property, or any part thereof, except as pcrmitted by the Agreement until a ccrtificate of completion releasing the Grantee from certain obligations of said Agreement as to this Property or such part thereof then to be conveyed, has been placed of record. This provision, however, shall in no way prevent the Grantee from mortgaging this Propcrty in order to obtain funds for the purchase of the Property hereby conveyed or for erccting the Minimum lmprovcments thereon (as defined in the Agreement) in conformity with the Agreement, any applicablc development program and applicable provisions of the zoning ordinance of the City of Monticello, Minnesota, or for the refinancing of the same. It is specifically agreed that thc Grantee shall promptly begin and diligently prosecute to completion the redevelopment of the Property through the construction of thc Minimum I mprovcments thcrcon, as providcd in the Agreement. Promptly aftcr completion or the Minimum Improvemcnts in accordance with the provisions of the Agreement, the Grantor will furnish the Grantee with an appropriate instrument so certifying. Such certification by the Grantor shall be (and it shall be so provided in the certification itself) a conclusive determination of satishlclion and termination of the agreements and covenants of the Agreement and of this Dccd with respect to the obligation of the Grantee, and its successors and assigns, to construct the Minimum Improvements and the dates for the bcginning and complction thcrcof. Such certification and such detcrmination shall not constitutc evidence of compliance with or satisfaction of any obligation of the Grantee to any holdcr of a SJH-266.108v3 MN190-121 B-1 mortgage, or any insurer of a mortgage, securing money loaned to finance the purchase of the . Property hereby conveyed or the Minimum Improvements, or any part thereof. All certillcations provided for herein shall be in such form as will enable them to be recorded with the County Recorder, or Registrar of Titles, Wril!ht County, Minnesota. If the Grantor shall refuse or fail to provide any such certification in accordance with the provisions of the Agreement and this Deed, thc Grantor shall, within thirty (30) days after written request by the Grantee, provide the Grantee with a written statement indicating in adequate detail in what respects the Grantee has failed to complete the Minimum Improvements in accordance with the provisions of the Agreement or is otherwise in default, and what measures or acts it will be necessary, in the opinion of the Grantor, for the Grantee to take or perform in order to obtain such certification. SECTION 2. The Grantee's rights and interest in the Property are subject to the terms and conditions of Section 9.3 of the Agreement relating to the Grantor's right to re-enter and revest in Grantor title to the Property under conditions specified therein, including but not limited to termination of such right upon issuance of a Certificate of Completion as dellned in the Agreement. SECfION 3. . The Grantee agrees for itself and its successors and assigns to or of the Property or any part thereof, hereinbefore described, that the Grantee and such succcssors and assigns shall comply with all provisions of the Agreement that relate to the Property or use thereof for the periods specified in the Agreement, including without limitation the covenant sct forth in Section 10.3 thereof. It is intended and agreed that the above and foregoing agreements and covenants shall be covenants running with the land for the respective terms herein provided, and that they shall, in any event, and without regard to technical classification or designation, legal or otherwise, and except only as otherwise specifically provided in this Deed, be binding, to the fullest extent permitted by law and equity for the benefit and in favor of, and enforceable by, the Grantor against the Grantee, its successors and assigns, and every successor in interest to the Property, or any part thereof or any interest therein, and any party in possession or occupancy of the Property or any part thereof. . In amplification, and not in restriction of, the provisions of the preceding section, it is intended and agreed that the Grantor shall be deemed a beneficiary of the agreements and covenants provided herein, both Il.)r and in its own right, and also fDr the purposes of protecting the interest of the community and the other parties, public or private, in whose favor or for whose benefit these agreements and covenants have been provided. Such agreements and covenants shall run in ravor of the Grantor without regard to whether the Grantor has at any time been, remains, or is an owner of any land or interest therein to, or in t~lVor of, which such agreements and covenants relate. The Grantor shall have the right, in the event of any breach of any such agreement or covenant to exercise all the rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breach of agreement or covenant, to which it or any other beneficiaries of such agreement or S.lB-266JOXv.1 MN190-121 B-2 . . . covenant may be entitled; provided that Grantor shall not have any right to re-enter the Property or revest in the Grantor the estate conveyed by this Decd on grounds of Grantee's failure to comply with its obligations under this Section 3. SECTION 4. This Deed is also given subject to: (a) Provision of thc ordinances, building and zoning laws of the City of Monticello, and state and federal laws and regulations in so far as they affect this real estate. (b) Declaration of Protective Covenants, Conditions and Protections for Otter Creek Crossing tiled February 17,2005 in the Office of the County Recorder tnr County, Minnesota as Document No. A 947485. (b) IOthersl Grantor certifies that it does not know of any wells on the Property. SJB-266JOXv3 MN190-121 B-3 . IN WITNESS WIIEREOF, the Grantor has caused this Deed to be duly executed in its behalf by its Chair and Executive Director and has caused its corporate seal to be hereunto afIixed this day of ____.w......__, 2005. MONTICELLO ECONOMIC DEVELOPMENTHOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO By Its Chair By Its Executive Director STATE OF MINNESOTA ) ) ss . COUNTY or ) On this__ day of , 2005, before me, a notary public within and for Wril!ht County, personally appeared and to me personally known who by me duly sworn, did say that they are the Chair and Executive Director of the llousing and Redevelopment Authority in and lor the City of Monticello, Monticello, Minnesota (the "Authority") named in the lc)j'egoing instrument; that the seal affixed to said instrument is the seal of said Authority; that said instrument was signed and sealed on behalf of said Authority pursuant to a resolution of its governing body; and said and acknowledged said instrument to be the free act and deed of said Authority. Notary Public This instrument was drafted by: Kennedy & Graven, Chartered 470 US Bank Plaza Minneapolis, Minnesota 55402 . S.lB-266308v3 MN190-121 B-4 . SCHEDULE C HOUSING AND REDEVELOPMENT AUTHORrry IN AND FOR THE CITY OF MONTICELLO RESOLUTION NO. AUTHORIZING INTERFUND LOAN FOR ADVANCE OF CERT/\IINCERTAIN COSTS IN CONNECTION WITH TAX INCREMEN'r FINANCING DISTRICT NO. 1-36 BE IT RESOLVED By the Board Of Commissioners of the Housing and Redevelopment Authority in and for the City of Monticello, Minnesota (the "Authority") as follows: Section 1. Background. 1.0 I. The Authority has established tax increment financing district no. 1-36 (the "TIF District") within the Central Monticello Redevelopment Project No. I (the "Redevelopment Project") pursuant to Minnesota Statutes, Sections 469.174 to 469.179 (the "TIF Act") and . Sections 469.001 to 469.047 (the "HRA Act"). 1.02. The Authority may incur certain costs related to the TIF District, which costs may be financed on a temporary basis from available Authority funds. 1.03. Under Section 469.178, Subdivision 7 of the TIF Act, the Authority is authorized to advance or loan money from any fund from which such advances may be legally made in order to finance expenditures that are eligible to he paid with tax increments under the TIF Act. 1.04. The Authority owns or will acquire certain property (the "Redevelopment Property") and has ineurred or will incur certain costs to prepare such property for redevelopment. The Authority has determined that the market price of the improved Redevelopment Property is at least $998,933, or $2.65 per square foot. 1.05. The Authority proposes to enter into a Purchase and Redevelopment Contract (the "Contract") with Rocky MountainMtn Group LI ,C (the "Redeveloper"), under which the Authority will (among other things) convey the Redevelopment Property to the Redeveloper for a purchase price of $549,095, suhject to Redeveloper's ohligation to pay a portion of City trunk fees in the amount of$37,9I4. . 1.06. By conveying the Redevelopment Property under the Contract, at Closing the Authority will forgo receipt the full market price of the Redevelopment Property. Sueh forbearance represents an advance of Authority funds in the amount of $411,924 (the write-down in purchase price net of Redeveloper's trunk fee payment). In addition. the Authoritv will exnend annroximatclv $27.300 to remove a dirt stocknile on the Redevclonment Pronertv. S.lfl-2li630Xv3 MN190-121 C-l . in accordance with Section 3.6(C) of the Contract. which amount renresents an additional advance of Authoritv funds. ~J.()7. The Authority intends to designate such land udvunce and fee paymentsadvances as an interfund loan in accordanee with the terms of this resolution and the TIF Act. Section 2. Repayment of Interfund Loan. 2.0 I. The Authority will reimburse itself for the land advance and dirt removal in the principal amount of $111,921139.224 together with interest at the rate of 4% per annum (the "Interfund Loan"). Interest aeerues on the principal amount from the date of Closing on conveyance of the Redevelopment Propcrty to the Redeveloper under the Development Agreement (hereafter, the "Closing Date"). The interest rate is no more than the greatest of the rate specified under Minnesota Statutes, Section 270.75 and Section 549.09, both in elTeet for calendar year 2005. The interest rate will, without further action by the Authority, be adjusted on January I of each year to reflect the greater of the rate speeified under Minnesota Statutes, Section 270.75 and Section 549.09 in effect f()r that calendar year. 2.02. Principal and interest ("Payments") on the Interfund Loan shall be paid semi- annually on each August 1 and February I (each a "Payment Date"), commencing on the first Payment Date on which the Authority has Availahle Tax Increment (defined below), or on any other dates determined by the City Administrator, through the date of last receipt of tax . increment from the TIF District. 2.03. Payments on the Intcrfund Loan will be made solely from Available Tax Increment, defined as tax increment from the TIF District received by the Authority from County in the six-month period before any Payment Date, less any amounts determined by the Authority to be applied toward administrative expenses in aecordance with the TIF Act. Payments shall be applied first to accrued interest, and then to unpaid principal. Interest accruing from the Closing Date will be compounded semiannually on February 1 and August 1 of each ycar and added to principal until the first Payment Date, unless otherwise specified by the City Administrator. 2.04. The principal sum and all accrued interest payable under this resolution is pre- payable in whole or in part at any time by thc Authority without premium or penalty. 2.05. This resolution is evidence of an internal borrowing by the Authority in accordance with Section 469.178, subdivision 7 of the TIF Act, and is a limited obligation payable solely from A vaijahle Tax Increment pledged to the payment hcreof under this resolution. The Interfund Loan shall not be dccmed to constitute a general obligation of thc State of Minnesota or any political subdivision thereof~ including, without limitation, the Authority and the City. Neither the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of or interest on the lnterfund Loan or other costs incident hereto except out of Available Tax Incremcnt. The Authority shall have no obligation to pay any principal amount of the lnterfund Loan or accrued interest thereon, which may rcmain unpaid . after thc final Payment Date. 2.06. The Authority may at any time make a determination to forgive the outstanding S.IB-266JOXv3 MNIlJO-121 C-2 . principal amount and accrued interest on the Interfund Loan to thc extent permissible under law. 2.07. The Authority may from time to time amend the terms of this Resolution to the extent permitted by law, including without limitation amendment to the payment schedule and the interest rate; provided that the interest rate may not be increased above the maximum specified in Section 469.178. subd. 7 of the TIF Act. Section 3. E1Tective Date. This resolution is effective upon execution in full of the Contract. Adopted this _ day of ,2005 Chair ATTEST: . Executive Director . SJB-26630Hv3 MNIl)O-121 C-3 . . . SCHEDULE D CERTIFICATE OF COMPLETION WHEREAS, the Housing and Redevelopment Authority in and for the City of Monticello, Minnesota, a public body, corporate and pulitic (the "Grantor"), by a Deed recorded in the Office of the County Rccorder or the Registrar uf Titles in and for the County of and State uf Minnesota, as Deed Document Number(s) and., respectively, has conveyed to .. ..___.___ (the "Grantee"), the full owing described land in County of Wright and State of Minnesota, tu-wit: and WHEREAS, said Deed contained certain covenants and restrictions set forth in Sections 1 and 2 of said Deed; and Wllf;:REAS, said Grantee has performed said covenants and conditions insofar as it is able in a manner deemed sufficient by the Grantor to permit the executiun and recording of this certification; NOW, THEREFORE, this is to certify that all building construction and uther physical improvements specified to be done and made by the Grantee have been completed and the above covenants and conditions in said Dccd and the agreements and covenants in Article IV of the Agreement (as described in said Deed) have been performed by the (hantee therein, and the County Recorder or the Registrar of Titlcs in and for the Cuunty uf and State of Minnesota is hereby authorized to accept f()r recording and to record, thc filing of this instrument, to be a conclusive determination of the satisfactory tcrmination of the covenants and conditions of Articlc IV of the, but the covenants crcatcd by Sections 3 and 4 of said Deed shall rcmain in full force and effect. Dated: , :20 HOUSING AND REDEVELOPMENT AUTHORITY IN AND fOR TIlE crrv OF MONTICELLO, MINNESOTA By Authority Representative SJH-2M30Sv3 MNI')O-121 D-1 . . . SCHEDlJLE E ASSESSMENT AGREEMENT and ASSESSOR'S CERTIFICATION By and Between HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO and ROCKY MOUNTAINMTN GROUP, LLC This Document was drafted by: KENNEDY & GRA VEN, Chartered 470 U.S. Bank Plaza SJB-26630Xv3 MN 190-121 E-l . . . ASSESSMENT AGREEMENT THIS AGREEMENT, made on or as of the _ day of ,2005, and between the Housing and Redevelopment Authority in and for the City of Monticello, a public body corporatc and politic (the "Authority") and Rocky MountainMtn Group, LLC, a Minnesota limited liability company (the "Redcvelopcr"). WITNESSETH, that WlTEREAS, on or heforc the date hereof the Authority and the Redeveloper have cntcrcd into a Purchasc and Redevelopment Agreement dated , 2005 (the "Redevelopment Contract"), pursuant to which the Authority is to Llcilitate development of eertain property in the City of Monticello hereinafter referred to as the "Property" and legally described in Exhibit A hereto; and WHEREAS, pursuant to the Redevelopment Contract the Redeveloper is obligated to construct certain improvements upon the Property (the "Minimum Improvements"); and WHEREAS, the Authority and the Redeveloper desire to establish a minimum market value for the Property and the townhouses constructed thereon, pursuant to Minnesota Statutes, Section 469.177, Subdivision 8; and WHEREAS, the Authority and the Assessor for the County (the "Assessor") have reviewed the preliminary plans and specifications for the townhouses and have inspected such improvements; NOW, THEREFORE, the parties to this Agreement, in considcration of the promises, covenants and agrecments made by each to the other, do hereby agree as f()lIows: I. The minimum market value which shall be asscsscd for the Property described in Exhibit A, togcthcr with the Minimum Improvements thereon, for ad valorcm tax purposes, shall be $2,900,000 as of January 2, 2006 and each January 2 thereafter notwithstanding the progress of construction of such Minimum Improvements hy such datcs. ) The minimum market value herein established shall he of no further force and effect and this Agrecment shall terminatc on the earlier of the following: (a) The datc of rcceipt by the Authority of the final payment from thc County of Tax Increments from TIF District No. 1-36; or (h) Thc datc when the Interfund Loan (as defined in the Redevelopment Contract) has bcen paid in full, defeascd or terminated in accordance with the resolution set forth in Schedulc C of thc Redevelopment Contract. The cvcnt referred to in Scctions 2(b) of this Agreement shall he evidenccd by a certificatc or affidavit exccutcd by the Authority. 3. This Agrccmcnt shall be promptly recordcd by thc Authority. The Redeveloper shall pay all costs of recording. S.lU-266JOXvJ MNI90-121 E-3 . . . 4. Neither the preambles nor provisions of this Agreement are intended to, nor shall they be construed as, modifying the terms of the Redevelopment Contract between the Authority and the RedevcIoper. 5. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties. 6. Each of the parties has authority to enter into this Agreement and to take all actions required of it, and has taken all actions necessary to authorize the execution and delivery of this Agreement. 7. In the event any prOVISIOn of this Agreement shall be held invalid and unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. 8. The parties hereto agree that they will, from time to time, execute, acknowledge and deliver, or cause to he executed, aeknowledged and delivered, such supplements, amendments and modifications hereto, and such further instruments as may reasonably be required f()r correcting any inadequate, or incorrect, or amended description of the Property or the townhouse thereon, or for carrying out the expressed intention of this Agreement, including, without I imitation, any further instruments required to delete from the description of the Property such part or parts as may be included within a separate assessment agreement. 9. Except as provided in Section 8 of this Agreement, this Agreement may not be amended nor any of its terms modified except by a writing authorized and executed by all parties hereto. 10. This Agreement may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. II. This Agreement shall be governed by and construed in accordance with the laws ofthc State of Minnesota. SJ 1.J-16630Sv] MN190-111 E-4 . . . HOUSING AND REDEVELOPMENT CITY OF MONTICELLO, MTI'fl\IESOTA By Its Chair By Its Executive Director STATE OF MINNESOTA ) ) SS. COUNTY OF ) The foregoing instrument was acknowledged before me this _ day of ____ ._,2005 by and__, the Chair and Executive Director of the Housing and Redevelopment Authority in and for the City of Monticello, Minnesota, on behalf of the Authority. SJll-266308v3 MNllJO-121 Notary Public E-5 . . . ROCKY MOL!NT.^.INMm GROlJP, LLC By Its STATE OF MINNESOTA ) ) SS. COUNTY OF ) The foregoing instrument was acknowledged before me this _ day of __ _ ____________..______________, 2005 by , the__ of Rocky MountuinMtn Group, LLc, a Minnesota limited liability company, on behalf of the limited liahility company. Notary Public SJR-266308v3 MNI<)O-121 E-6 . . . CERTIFICATION BY COUNTY ASSESSOR The undcrsigned, having reviewed the plans and specifications for thc improvements to be constructed and the market value assigned to the land upon which the improvements are to be constructed, hcreby certifies as follows: The undersigned Assessor, being legally responsible for thc assessment of thc above describcd property, hereby certifics that the values assigncd to the land and improvemcnts are reasonablc. County Assessor for the County of Wright STATE OF MINNESOTA ) ) ss COUNTY OF WRIGI IT ) The foregoing instrument was acknowledged beforc me this _ clay of __ 2005 by ___ ____, the County Asscssor of the County of Wright. Notary Public SJB-266308v3 MN190-121 E-7 . . . EXHIBIT A of ASSESSMENT AGREEMENT Legal Description of Property Lot 1, Block 1, Otter Creek Crossing 1 st Addition, accorcling to the recorded plat thereof, Wright County, Minnesota SJI3-21i630Xv3 MN190-121 E-8 . . . SCHEDULE F Doc. No. A 947485 OFFICE OF THE COUNTY RECORDER WRIGHT COUNTY, MINNESOTA Cmtified Filed and/or Recorded on 02-17-2005 at 01:09 Che<:k #; Fee: $19.50 Paymli'm Code 04 Add! Foo Larry A Unger, county Reoorder (fl~:.:rl't:dlr' R",o'lJ""lnfoN;urrtol!) ................... ..............:;..::,:,;,,...'~~:::::.:::~:'N.W ,',' ,',',=N=:-W:W"i'i"<t')WM~" .~.. .....-.-. .. ',W,~', w'~"'1~=""""""""" DECLARATION OF PROTECTIVE COVENANTS, CONDITIONS, AND PROTECTIONS FOR OTTER CREEK CROSSL"IG THIS DECLARA nON is l11<lde by the CITY OF MONTICELLO, a Minnesota municipal corporation ("Declarant"). WHEREAS. De>.:larMlt is the fee owner oheal property in the City of Monticelio, Wright County, Minnesota, legally descrihed as Lot 1. Block 2, Otter Creek Cr08~ing ("the Propeny"); and WIIEREAS, Declarant hll.'l grfulted the Housing and Redevelopmem Authority (htreinaiter referred to "HRA") the authority to administer these protective covenants; and WHEREAS. Declarant desires to emblish covenants, conditions, and protections which will benefit the Property for the purpose of facilitating development of the Property and for the pnrpose of protecting 31\d preserving the value and desirability of the Property; and WHEREAS, all Property O\VilCrS arc advised that they will be expected to abide by the protective covenants hereby established by Declar'J.nt These standards are intended to assure the integrity GfOtler Creek Crossing and prot!;c! property values and adjoining propelty uses. THEREFORE, BE IT Iff SOLVED THAT, the Declarant declares that the Property, shall be used, occupied, and conveyed subject to the covenants, conditions, and protections set forth in this Declaration, aU of which shall be binding on all pt'J."sons I :6'ii3 REtURN TO: C!'1'Y Or' MON'i'lC2X,],Q 505WALN1]T STRUT 1/1 MoNTlCFJ,L{}llli55:3 62 SJR-26630Xv3 MN 190-121 F-l J flrG- . . . O'Virnng or acquiring any right, title or interest in the Property a.nd their heirs, personal representatives, successors and assigns. SECTION 1 1. DEFINITIONS; 1.1 "Declarant" shall mean the City of Monticello. 1.2 "Improvemcnts" shall mean all strucnJres and other construction on a lot or parcel for use permitted by the zoning ordinances of the City of Monticello, including, but not limited to, bulidings, outbulJdings, parking areal!, loading areas, outside platforms and docks, driveways, walkwaysl fences, lawns, landscaping, signs, retain \....alls. decks. railroad tracks, poles, berms and swales, and exterior lighting. 1.3 "lot" shall mean a portion of the Property identified as a lot on a subdivision plat preparc:d in ai;cordance with Minnesota StaMe$, Chapier 505, and tiled fOr record in the Wright County Recorder's Office. 1.4 "Occupant" shall mean any person, other \h,m an owner, in possession of a lot or parceL 1.5 "Owner" ~,'or purposes of this Declaration shall be the Declarant andi15 successors as recorded fee simple owner of any part of the Property. For purposes hereof, if any part of the Property is sold under a. contract for deed or leased under a ground lease, the contact for deed purchaser ("Vendee") and/or ground lessee shall be deemed the Owner in lieu of the record fee simple owner, provided however. that for purposes ofamending or modifying this Declaration, the fee simple title owner and 1he Vendee andlor ground lessee, as the case may be, shall jointly all be deemed the Owner. 1.6 "Person" shall mean a natural individual, cOlporations, limited liability company, partnership, trusteel or other legal entity capable of holding title to real property. 1,7 "Property" shall mean all ofthe real prOperty submitted to the provisions of this Declaration, including all improvements located on the real property now or in the future 1110 Property as of the date of this Declaration is legaHy described as Lot 1, Block 2, Otter Creek Crossing, Wright County, Minnesota, 116553 2 S.lLl-2(;630XvJ MN 190-121 F-2 . . . SECTION 2 2. STAi'\DARDS FOR CONSTRUCTION AND MAINTENANCE 2.1 Minimum Standards The minimum standards for the construction, alteration, and maintenance of improvements on the Property shall be those set forth by the City of Monticello and any other governmental agency which may have jurisdiction over the Property. AU improvements on the Property shall conform to the then existing huHdin15 codes in effect for the City of Monticello and shall be in compliance with allla\",s, rules and regulalloos of any govennncntal body that may be applioable, including, without limiu:tion, environ menIal laws and regulations. Where thetoiJowing restrictive covenants are more stringent than the zoning ordinances, other laws and regulations ofthe City of MonticeHo or any other applicable govemment agency., the restrictive covenants Contained in this Declaration shall govern and become minimum standards by which the impro,'ements and maintenance of them shall be controlled. 2.2 Use No outdoor storage is allowed, On all lots, no owner or DcellpMt shall ;;tore materials, equipmeot, or items outside of any building, orne follOWing exceptions are nOl to be considered storage, and may be located outside in compliance ".\lith other applicable regulations: a. Passenger vt:hicles and light trocks parked in compliance with the City of Monticello zoning regulations, b, Parking of company vehicles, inclucllngtrucks, vans, and other similar vehlcIes, :except that semi-tractors and trailers may only be parked in the side and rear yards. c. Semj~trailers locilted in designated loading docks d. Trash handling equipment 1,,3 Building Qualit)' and Materials No building shall utilize metal or steel sidewall building materials ,vith the exception of architectural panels that do not exceed ten percent (10%) of the sidewall surface area. 11 (i51) 3 SJB-266JOHvJ MN 190-] 21 F-3 . . . S./B-26630Rv3 MN190-121 2,4 LandscapJng Irrigatiou System On an lots on which a building is proposed to be constructed. the owner shaH, prior to occupancy of the building) install in-ground landscaping irrigation between the front buildingHne and the public street. This requirement shall also apply to the side lot areas of corner lots which fact: a different street. in the case of rear lot areas that front on a public street, the owner shall install landscaping irrigation for aU landscaped areuwithin fifty (50) feet of the public street. The irrigation system shall provide adequate water to aU landscaped areas, including lawns, shrubs, trees. ilower beds, or other similar fearures, This requirement also applies to the "boulevard" portion oUhe public right of way between the o'lh'ller's property Hne and the curb line of the public street 2.5 General Exterior Maintenance Each owner and occupant of a lot shall fully and properly maintain and n::pairthc exterior of any structure located on such lot in such a manner as to enhance the overall appearance of the Property, The exteriors of all buildings and the parking. driving, and loading areas shall be kept and maintained in 2. good stale of rl:.'Pair at all times and be adequately maintained. All lots shaH be kept free of debris of any kind and all landscaping ruus! be kept in good repair_ All landscaped areas shall be graded to provide proper site drainage. Landscaped areas shall be maintained in neat condition, lawns mowed, and adequately \vatered in sumnH;:r, hedges trimmed, and leaves rakes. 2.6 Construction Construclion or alteratiolJ of any improvement on a lot shall be diligenuy pursued and shall not remain in a partly finished condition any longer than is reasonably necessary for completion of the construction or alteration, The owner and occupant of any lot upon which improvenlcnts are constntcted shalt at all times, keep the lot and ~treets being utilized by such O\VTler in connection with such construction, free from dirt, mud, garbage, trash, or other debris which might be occasioned by such construction or alteration, 2.7 Noxious Activities No trades, sendces, activities, operations, or usage shaUbe permitted or . .... l" ~"' .. ,1:, 1 + + 1 "." '., iii '* "" ...~ .... .... T. .. . . .4'.jr.. .. F-4 . . . b. The emission of fumes, odors, glare, vibration) gases, radiation, dust, liquid wastes, smoke or noise ora nature and quantity prohibited by applicable laws, 2.8 Ttmporary Structure Trailers, temporary constrUction buildings~ and the like, shall be permitted ol1Iy for construction purposes during the period of constrUction or alteration ofa permanent building. Such stroctures shall be placed as inconspicuously as practical and shall be removed not later than thirty (30) days after the date of thc substantial completion of the building. 2.9 Loading Dock.-; 1\'0 loading dock shall face School Boulevard or Chelsea. Road, SECTION 3 3. GENERAL TER.\1S 3.1 Nature and Term The protective covenants hereinafter set forth shall be considered as covenants funning with the Iandt to be blnding on aU persons claiming under them and run for a period of thirty (30) years from the date of filing with the Wright County Recorder's Office at which time the protective covenants shall be automatically renewed for successive periods often (10) years unless, prior to the renewal date. the owners of eighty percent (80%) or more of the lots agrct:: in writing that the CClvenants shall terminate at the end of that period. 3.2 Amendments This Declaration may be amended, modified, Of terminated by an instrument in writing, executed by the: Owners of eighty percent (80%) of the lots. Each lot shall be considered to have one vote, An instrument executed in accordance with this section shall be effective when flIed for recording with the Wright County Recorder's omce. 3.3 Severability If any term, covenant or provision of this instrument, or an exhibit attached to it is held to be invalid or unenforceable for any reason \....hatsoever, such detem1inal:on shall not be deemed to alter, affect., or impair, in any manner whatsoever, any other portion ofthls document or exhibits. 116m 5 SJU-2(A,ORv3 MN190.121 F-5 . . . 4. SECTION 4 COVENANT ADMINISTRATION 4.1 Enforcement The Declarant, HRA and the ov,'Der of any lot shall each, either acting separately or mcommon. have tbe authority to bring action for specific perfonnance or injunctive relief to enforce any pfotective covenant contained herein. 4.2 Adoption Tnese Protective Covenants become efiective upon their execution and recording by the Dcclarrnt B' Rick WolfsteU ,City Admillistrator STATE OF MINNESOTA ) )55. COUNTY OF WRiGHT ) Th;: foregoing instrument was acknowledged before mc this 14t.h day of February , 2005, by Clint Herbst and Rick Wol:fsteller, lh~ Mayor and City Administrator, r::speclively, of the City of Monticello, a Minnesota municipal corporation, on behalf of the corporation .and. pursuant to the authority granted by its City CounciL ~}"\ ('<\. ...j~.:?~ Notary Public THIS INSTRUMENT DRAFTED By; CAMPBELL KNUTSON. P.A Professional Association 317 Eagandale Office Center 1380 Corporate Center Curve Eagan, Minnesota 5512 1 TMSlcjh OAWN M. GROSSINGf;R NOTARY Pueuc. MlN>jIiSOl'^ Ik1 ~m\I$IM &pm J~. 31, 201D Ilb,5~ 6 947485 SJIl-266308v3 MN Il)O~121 F-6 August 25, 2005 MONTICELLO Mr. Kenncth Streeter Streeter Companies, Inc, 6900 Winnetka Circle Brooklyn Park, MN 55428 Re: Dahlhcimer Project Dear Mr. Streeter: Thc City of Monticello and the Housing and Redevelopment Authority (I-IRA) want to do business with Dahlheimer Distributing Company. They are a long standing Monticello company and the Dahlheimers have been good neighbors, There seems to be discrepancies in the collective memories on this project as to how we got to where we are - with a large pile of dirt in the way of progress; however, this does not relieve us of our obligation to find a solution. . I believe city staff has worked in good faith to move your project along, he flexible, and even accommodating and should be commcnded for their perseverance. I also helieve that more definition and formality needs to he buill into the city's development process so there is less 1'00111 for "interpretation", As HRA Chairman, I will recommend that the HRA remove the dirt pile at our cost; and provide a rough graded site as per the June 22 offer. Please understand that it is our desire to work in an open and fair way with husiness, and expeet the same f.'om the business community. Sincerely, HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO ~Q~.__ L ~'- Darrin Lahr Chairman DUok c: Greg Dahlheimer Clint Herbst, Mayor Bret Wciss, WSB, Inc. David Johnson, Esq, Steve Rubul, HRA Attorney . Monticello City Hall, 505 Walnut Strect, Suite I, Monticello, MN 55362~8831 . (763) 295-2711 . Fax: (763) 295-4404 Office of Puhlic Warks, 909 Golf Course Rd., Monticello, MN 55362 . (763) 295-3170. Fax: (763) 271-3272