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EDA Agenda - 02/14/2024AGENDA REGULAR MEETING - ECONOMIC DEVELOPMENT AUTHORITY (EDA) Wednesday, February 14, 2024 — 6:00 p.m. Mississippi Room, Monticello Community Center ECONOMIC DEVELOPMENT AUTHORITY SPECIAL MEETING 5:00 p.m. • Retail Market Analysis Discussion with Jim McComb Commissioners: President Steve Johnson, Vice President Jon Morphew, Treasurer Hali Sittig, 011ie Koropchak-White, Rick Barger, Councilmember Tracy Hinz, Mayor Lloyd Hilgart Staff: Executive Director Jim Thares, Rachel Leonard, Angela Schumann, Hayden Stensgard, Sarah Rathlisberger 1. General Business A. Call to Order B. Roll Call 6:00 p.m. 2. Annual Business Meeting A. Consideration of electing EDA officers B. Consideration of reviewing EDA Bylaws C. Consideration of reviewing EDA Enabling Resolution D. Consideration of EDA Financial Statements and Fund Balance Information 3. Consideration of Additional Agenda Items 4. Consent Agenda A. Consideration of Payment of Bills B. Consideration of Approving Regular Meeting Minutes—January 10, 2024 C. Consideration of Resolution No. 2024-01 conveying Outlot A, Great River Addition (4.81 acres) to the City of Monticello 5. Public Hearing A. Consideration of Resolution 2024-02 authorizing a $300,000 GMEF Loan and Business Subsidy to Block 52 Holdings, LLC, Buchholz Exchange, LLC and Norgren Exchange, LLC for the Project Simpl build out - 101 West Broadway Street B. Consideration of Resolution 2024-03 authorizing a $48,422 Fagade Improvement Forgivable Loan and Business Subsidy to Bliss Salon — 109 Walnut Street 6. Regular Agenda A. Consideration of AE2S Marketing Proposal in the amount of $16,874 for preparation of housing and economic development resources 7. Other Business A. Consideration of Economic Development Manager's Report 8. Adjournment EDA Agenda: 2/14/2024 2A. EDA Annual Business Meeting Prepared by: Meeting Date: ® Regular Agenda Item Community & Economic Development 2/14/2024 ❑ Consent Agenda Item Coordinator Reviewed by: Approved by: N/A Economic Development Manager REFERENCE AND BACKGROUND: The EDA is required to hold an Annual Meeting each year to elect officers, make appointments as needed and consider Bylaw changes. The EDA's enabling resolution and Bylaws are attached for review. Staff would be happy answer any questions or requested clarifications on the organizational documents. It should be noted that some items may require consultation with EDA legal counsel. Offices which need to be filled for 2024 include the President, Vice President and Treasurer. Staff can serve as the EDA Secretary for recording meeting minutes. It should be noted that City Council EDA members may also serve as officers. Also attached for review and discussion is the 2023 Year End Financial reports of the EDA Fund(s). I. Staff Impact: There is minimal staff time involved in preparing the staff report for consideration of the Annual Business Meeting. II. Budget Impact: No expected budget impact from the Annual Business Meeting. ALTERNATIVE ACTIONS A: 1. Motion to elect 2024 officers: as Vice President, and 2. Motion to table election of 2024 EDA Officers. ALTERNATIVE ACTIONS B: as President, as Treasurer. 1. Motion to direct staff to prepare draft amendments to the EDA Enabling Resolution or Bylaws as follows: (amendments to the Enabling Resolution require a public hearing). 2. Motion of other. STAFF RECOMMENDATION: Staff defer to the EDA for appointment of officers (Alternative Action A). Currently, staff do not have any recommended amendments to the Enabling Resolution or Bylaws and defer to the EDA 2 regarding Alternative Action B2. Staff recommend approval of Alternative 1. SUPPORTING DATA: A. EDA Bylaws B. EDA Enabling Resolution C. EDA 2023 Year End Financial Reports BYLAWS OF THE ECONOMIC DEVELOPMENT AUTHORITY ARTICLE I - THE AUTHORITY Section 1. Name of Authority. The name of the Authority shall be the "City of Monticello Economic Development Authority." Section 2. Office of Authority. The office of the Authority shall be at the City Hall in the City of Monticello, State of Minnesota, but the Authority may hold its meetings at such other place or places as it may designate by resolution. Section 3. Seal of Authority. The seal of the Authority shall be in the form of a circle and shall bear the name of the Authority and the year of its organization. Section 4. Establishment. The City of Monticello Economic Development Authority is established pursuant to Minnesota Statutes, Section 469.090 to 469.108 1, as amended. ARTICLE II - THE COMMISSIONERS Section 1. Appointment, Terms, Vacancies, Pay, and Removal. Shall be in accordance with the Amended and Restated Resolution Enabling the Creation of the City of Monticello Economic Development Authority dated October 22, 2007 and as it may be amended (the "Enabling Resolution") and Section 2-3-1 of Ordinance Amendment No. 172, Chapter 3, City of Monticello, Wright County, Minnesota. ARTICLE III - THE OFFICERS Section 1. Officers. The Authority shall elect a president, a vice president, a treasurer, a secretary, and an assistant treasurer at the annual meeting. A commissioner must not serve as president and vice president at the same time. The other offices may be held by the same commissioner. The offices of secretary and assistant treasurer need not be held by a commissioner. Section 2. President. The President shall preside at all meetings of the Authority. Except as otherwise authorized by resolution of the Board of Commissioners, the President and the Executive Director (the Assistant Treasurer, in the Executive Director's absence or incapacity) shall sign all contracts, deeds, and other instruments made or executed by the Authority, except that all checks of the Authority shall be signed by the Treasurer and Assistant Treasurer. At each meeting the President shall submit such recommendations and information as he or she may consider proper concerning the business, affairs, and policies of the Authority. Section 3. Vice President. The Vice President shall perform the duties of the President in the absence or incapacity of the President, including signing all contracts, deeds, and other instruments executed by the Authority; and in the case of the resignation or death of the 3255990 MNI MN 190-130 President, the Vice President shall perform such duties as are imposed on the President until such time as the Board shall select a new President. Section 4. Secretary. The Secretary shall keep minutes of all meetings of the Board and shall maintain all records of the Authority. The office of Secretary may be held by the Executive Director upon approval thereof by the Authority. Section 5. Treasurer's Duties. The treasurer: (1) shall receive and is responsible for Authority money; (2) is responsible for the acts of the assistant treasurer; (3) shall disburse Authority money by any Authority -approved method, including without limitation check, wire transfer, or credit card; (4) shall keep an account of the source of all receipts and the nature, purpose, and authority of all disbursements; (5) shall file the Authority's detailed financial statement with its secretary at least once a year at times set by the Authority; and (6) shall prepare and submit an annual report describing the Authority's activities and providing an accurate statement of its financial condition to the City of Monticello by no later than one month following the annual meeting of the Authority. Section 6. Assistant Treasurer. The assistant treasurer has the powers and duties of the treasurer if the treasurer is absent or incapacitated. Section 7. Public Money. Authority money is public money. ARTICLE IV - EXECUTIVE DIRECTOR The City Administrator, or any other person designated in writing by the City Administrator and approved by a majority of the EDA commissioners, shall be designated as Executive Director of the EDA. Section 1. Duties. The Executive Director shall have general supervision over the administration of the Authority's business and affairs subject to the direction of the Authority. The Executive Director in his or her own name and title shall keep the records of the Authority, shall act as recorder of the meetings of the Authority and record all votes, and shall keep record of the proceedings of the Authority in a journal of proceedings to be kept for such purpose, and shall perform all duties incident to the office. The Executive Director shall, with the President, sign all contracts, deeds, and other instruments executed by the Authority, and shall keep in sole custody the seal of the Authority and shall have power to affix such seal to all contracts and 2 325599v6 MNI MN190-130 instruments authorized to be executed by the Authority. Any person appointed to fill the office of Executive Director, or any vacancy herein, shall have such terms as the Authority fixes, but no commissioner of the Authority shall be eligible to serve as the Executive Director. ARTICLE V - MEETINGS Section 1. Regular Meetings. Regular meetings shall be held on the 2"d and 0 Wednesdays of each month. Section 2. Annual Meeting. The annual meeting of the Authority shall be held in conjunction with the regular February meeting at the regular meeting place of the Authority. The August regular meeting shall include final fund balances reviewed at the Annual Meeting. Section 3. Special Meetings. Special meetings of the Authority may be called by the President, two members of the Authority, or the Executive Director for the purpose of transacting any business designated in the call. All commissioners of the Authority shall be notified. Section 4. Quorum. At any meeting of the Authority, the presence of four commissioners shall constitute a quorum. If a quorum is not present at any meeting, those present shall have power to adjourn the meeting from time to time without notice other than announcement at such meeting until the requisite number of votes shall be present to constitute a quorum. At any such adjourned meeting at which a quorum is present, any business may be transacted which might have been transacted at the meeting as originally called. Any resolution, election, or other formal action of the Authority shall be adopted upon the affirmative vote of a majority of the Authority membership. Section 5. Rules of Procedure. Unless otherwise specified in the Enabling Resolution or in these bylaws, all meetings of the Authority shall be conducted in accordance with Roberts' Rules of Order revised. Section 6. Manner of Voting. The voting on all questions coming before the Authority shall be voice unless the President calls for a roll call vote. The yeas and nays shall be entered upon the minutes of such meetings. ARTICLE VI - EMPLOYEES; SERVICES; SUPPLIES Section 1. Employees. Subject to limits set by the appropriations or other funds made available, the Authority may employ such staff, technicians, and experts as may be deemed proper and may incur such other expenses as may be necessary and proper for the conduct of its affairs. Section 2. Contract for Services. The Authority may contract for services of consultants, agents, public accountants, and other persons needed to perform its duties and exercise its powers. 3 3255990 MNI MN190-130 hire a general counsel for its legal needs. The city attorney or general counsel, as determined by the Authority, is its chief legal advisor. Section 4. Supplies. The Authority may purchase the supplies and materials it needs to carry out its function pursuant to Minnesota Statutes, Sections 469.090 to 469.1081. Section 5. City Purchasing_ The Authority may use the facilities of its city's purchasing department in connection with construction work and to purchase equipment, supplies, or materials. Section 6. City Facilities, Services. The City may furnish offices, structures and space, and stenographic, clerical, engineering, or other assistance to the Authority. Section 7. Delegation Power. The Authority may delegate to one or more of its agents or employees powers or duties as it may deem proper. ARTICLE VII - POWERS Section 1. Functions, Powers, and Duties. Shall be in accordance with the Enabling Resolution. Section 2. Limitations of Power. Shall be in accordance with the Enabling Resolution. ARTICLE VIII - AMENDMENTS Section 1. Amendment to Bylaws. The bylaws of the Authority shall be amended by a majority vote of the Authority membership at a regular or special meeting. The amendments must be in written form. Section 2. Conflicts. In any instance where these bylaws are in conflict with the Enabling Resolution, the Enabling Resolution shall control. Section 3. Effective Date. These bylaws are effective upon their adoption by the Authority. Dated: August 14, 2019. Signed: Preside (Seal) xecutive Director 4 325599v9MN190-130 CITY OF MONTICELLO WRIGHT COUNTY, MINNESOTA RESOLUTION NO. 2013-010 AMENDED AND RESTATED RESOLUTION ENABLING THE CREATION OF THE CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY BE IT RESOLVED by the City Council of the City of Monticello, Minnesota ("City") as follows: Section 1. Background and Findings 1.01. The City is authorized by Minnesota Statutes, Sections 469.090 to 469.1081 (the "EDA Act") to establish an economic development authority to coordinate and administer economic development and redevelopment plans and programs for the City. 1.02. By Ordinance No. 172, approved April 10, 1989 and codified in the City Code as Title II, Chapter 3 (the "Enabling Ordinance"), the City established the City of Monticello Economic Development Authority ("EDA"), for the purpose of coordinating and administering economic development activities in and for the City. 1.03. By resolutions approved on October 22, 2007 and January 14, 2008, the City transferred to the EDA the control, authority and operation of all projects administered by the Housing and Redevelopment Authority in and for the City of Monticello and adopted an Amended and Restated Enabling Resolution (the "Enabling Resolution"), which superceded the Enabling Ordinance in all respects. 1.04. The City Council further amended the Enabling Resolution after a duly noticed public hearing on February 27, 2012. 1.05. The City Council has now determined to revise and clarify certain provisions of the Enabling Resolution by the adoption of this resolution. 1.06. The City Council has, in accordance with Minnesota Statutes Section 469.093, provided public notice and conducted a public hearing on the date hereof, at which all persons wishing to be heard were given an opportunity to express their views, concerning the proposed modifications to the Enabling Resolution. 1.07. This resolution constitutes an amendment and restatement of the Enabling Resolution of February 27, 2012, and supercedes such Enabling Resolution in all respects. Section 2. Enabling Authority. 2.01. The EDA was established pursuant to the EDA Act under the Enabling Ordinance as adopted April 10, 1989 and codified as Title II, Chapter 3 of the City Code, as amended and restated by this resolution. 2.02. The EDA shall be composed of 7 commissioners to be appointed by the Mayor and confirmed by the City Council. 2.03. Two of the commissioners shall be members of the City Council. The terms of office of the two members of the City Council shall coincide with their terms of office as members of the City Council. The remaining five (5) commissioners shall be initially appointed for terms of one, two, three, four, and five years respectively. Thereafter, all non -Council commissioners shall be appointed for six-year terms. 2.04. A vacancy is created in the membership of the EDA when a City Council member of the board of commissioners ends Council membership, when any commissioner ends EDA membership prior to expiration of his or her term of office, on the day following the expiration of a commissioner's term of office, or when a commissioner is removed by the City Council subject to the terms of Section 2.07 hereof . A vacancy for this or any other reason must be filled for a new term or the balance of the unexpired term, as applicable, in the manner in which the original appointment was made. 2.05. All of the commissioners who are not members of the City Council must be either residents of the City, business -owners in the City, or property -owners in the City. 2.06. All commissioners shall serve at the pleasure of the City Council, subject to the terms of Section 2.07 hereof. Vacancies shall be filled by appointment by the Mayor with the confirmation of the City Council. 2.07. A commissioner may be removed by the City Council for inefficiency, neglect of duty, or misconduct in office. A commissioner shall be removed only after a hearing. A copy of the charges must be given to the commissioner at least 10 days before the hearing. The commissioner must be given an opportunity to be heard in person or by the counsel at the hearing. When written charges have been submitted against the commissioner, the City Council may temporarily suspend the commissioner. If the City Council finds that those charges have not been substantiated, the commissioner shall be immediately reinstated. If a commissioner is removed, a record of the proceedings together with the charges and findings shall be filed in the office of the City Administrator. 2.08. The City Council shall make available to the EDA such appropriations as it deems fit for salaries, fees, and expenses necessary in the conduct of its work. The EDA shall have authority to expend all budgeted sums so appropriated and recommend the expenditures of other sums made available for its use from grants, gifts, and other sources for the purposes and activities authorized by this resolution. Section 3. Officers and Meetings. 3.01. The EDA shall elect a president, vice president, treasurer, assistant treasurer, and secretary annually. A commissioner must not serve as president and vice president at the same time. The other offices may be held by the same commissioner. The other offices of the secretary and assistant treasurer need not be held by a commissioner. 3.02. The EDA shall adopt rules and procedures not inconsistent with the provisions of this Enabling Resolution or as provided in Minnesota Statutes, Section 469.096, and as may be necessary for the proper execution and conduct of its business. The EDA shall adopt bylaws and rules to govern its procedures and for the transaction of its business and shall keep a record of attendance at its meetings and/or resolutions, transactions, findings, and determinations showing the vote of each commissioner on each question requiring a vote, or if absent or abstaining from voting, indicating such fact. The records of the EDA shall be a public record, except for those items classified by law as nonpublic data. 3.03. The EDA shall meet at least quarterly. Special meetings may be called by the president as needed. 3.04. All administrative procedures, including contract for services, purchases of supplies, and financial transactions and duties shall be outlined in the bylaws of the EDA. Section 4. Staff. 4.01. The City Administrator, or any other person designated in writing by the City Administrator and approved by a majority of the EDA commissioners, shall be designated as Executive Director of the EDA. 4.02. Subject to limits set by the appropriations or other funds made available, the EDA may employ such staff, technicians, and experts as may be deemed proper, and may incur such other expenses as may be necessary and proper for the conduct of its affairs. Section 5. Functions, Powers, and Duties. 5.01. Except as specifically limited by the provisions of Section 6 of this Enabling Resolution, the EDA shall have the authority granted it pursuant to the EDA Act. 5.02. The EDA shall manage the Greater Monticello Enterprise Fund (the 'Fund") the purpose of which is to encourage economic development by making loans to private businesses. The EDA shall make loans to eligible businesses, and such loan(s) shall serve a public purpose as defined in the Greater Monticello Enterprise Fund Guidelines (Fund Guidelines). The Fund Guidelines are hereby adopted by reference and included in the bylaws of the EDA. No changes to the fund Guidelines shall be made without approval of the City Council. 5.03. The EDA may be a limited partner in a partnership whose purpose is consistent with the EDA's purpose. 5.04. The EDA may issue general obligation bonds and revenue bonds when authorized by the City Council and pledge as security for the bonds the full faith, credit, and resources of the City or such revenues as may be generated by projects undertaken by the EDA. 5.05. The EDA may cooperate with or act as agent for the federal or state government or a state public body, or an agency or instrumentality of a government or other public body to carry out the powers granted it by the EDA Act or any other related federal, state, or local law in the area of economic development district improvement. 5.06. The EDA may annually develop and present an economic development strategy and present it to the City Council for consideration and approval. 5.07. The EDA may join an official, industrial, commercial, or trade association or other organization concerned with such purposes, hold reception of officials who may contribute to advancing the City and its economic development, and carry out other appropriate public relations activities to promote the city and its economic development. 5.08. The EDA may perform such other duties which may be lawfully assigned to it by the City. All city employees shall, upon request and within a reasonable time, furnish the EDA or its employees or agents such available records or information as may be required in its work. The EDA or its employees or agents may, in the performance of official duties, enter upon lands and make examinations or surveys in the same manner as other authorized City agents or employees and shall have such other powers as are required for the performance of official functions in carrying out the purposes of this resolution. Section 6. Limitations of Power. 6.01. The following limits apply to the EDA and its operation: (a) The sale of bonds or other obligations of the EDA must be approved by the City Council. (b) The EDA must follow the budget process for City departments in accordance with City policies, ordinances, and resolutions and the City charter. (c) Development and redevelopment actions of the EDA must be in conformity to the City comprehensive plan and official controls implementing the comprehensive plan. (d) The EDA must submit its plans for development and redevelopment to the City Council for approval in accordance with City planning procedures and laws. (e) Except when previously pledged by the EDA, the City Council may, by resolution, require the EDA to transfer any portion of the reserves generated by activities of the EDA that the City Council determines are not necessary for the successful operation of the EDA to the debt service funds of the city to be used solely to reduce tax levies for bonded indebtedness of the City. (f) The administrative structure and management practices and policies of the EDA must be approved by the City Council. (g) The EDA shall submit all planned activities for influencing the action of any other governmental agency, subdivision, or body to the City Council for approval. 6.02. The EDA may exercise all the powers under the EDA Act, including, but not limited to, the following: (a) all powers under the HRA Act. (b) all powers of a city under Minnesota Statutes, Section 469.124 to 469.134. (c) all powers and duties of a redevelopment agency under Minnesota Statutes, Sections 469.152 to 469.165 for a purpose in the HRA Act or the EDA Act, and all powers and duties in the HRA Act and the EDA Act for a purpose in Minnesota Statutes, Sections 469.152 to 469.165. (d) the authority to acquire property, exercise the right of eminent domain; make contracts for the purpose of redevelopment and economic development; serve as a limited partner in a partnership whose purpose is consistent with the EDA's purpose; buy supplies and materials needed to carry out development within the EDA Act; and operate and maintain public parking facilities. (e) the authority to issue bonds in accordance with the EDA Act and the HRA Act. (f) the authority to levy special benefit taxes in accordance with Section 469.033, subdivision 6 of the HRA Act in order to pay or finance public redevelopment costs (as defined in the HRA Act), subject to approval by the City Council in accordance with Section 469.033, subdivision 6. (g) all powers under Minnesota Statutes, Sections 469.474 to 469.179. 6.03. As provided in the EDA Act, it is the intention of the City Council that nothing in this resolution nor any activities of the EDA are to be construed to impair the obligations of the City or HRA under any of their contracts or to affect in any detrimental manner the rights and privileges of a holder of a bond or other obligation heretofore issued by the City, the EDA or the HRA. Section 7. Implementation. 7.01. The City Council will from time to time and at the appropriate time adopt such ordinances and resolutions as are required and permitted by the EDA Act to give full effect to this resolution. 7.02. The Mayor, the City Administrator, and other appropriate City officials are authorized and directed to take the actions and execute and deliver the documents necessary to give full effect to this resolution. 7.03. Nothing in this resolution is intended to prevent the City from modifying this Enabling Resolution to impose new or different limitations on the EDA as authorized by the EDA Act. ADOPTED BYthe City Council of the City of Monticello on this 25th day of March, 2013 CITY OF MONTICELLO Clint Herbst, Mayor ATTEST: Jeft,0XV11, City Administrator CITY OF MONTICELLO Schedule of Assets, Liabilities, Deferred Inflows of Resources, and Fund Balances Economic Development Authority & Small Cities Development Program December 31, 2023 - Unaudited TIF 6 (d) TIF 19 (d) TIF 20 (d) TIF 22 (d) TIF 24 TIF 29 TIF 30 TIF 34 (d) TIF 40 TIF 41 TIF 42 � 43 TIF 45 TIF 46 GAAP Total Total EDA General GMEF TIF Future Raindance MS Shores Prairie West Downtown St. Henry's Front Porch CMHP Interchange Briggs UMC Headwaters Headwaters Block 52 WiHa Reconciliation EDA SCDP ASSETS Cash and investments $ 2,114,264 $ 1,056,105 $ $ 49,450 $ 37,719 $ 104,142 $ 519,286 $ 55,800 $ 34,654 $ 80,227 $ 77,340 $ 13,478 $ 31,671 $ $ $ $ $ 4,174,136 $ 828,753 Receivables Unremitted taxes 753 - - - - - - - - - - - 753 - Delinquent taxes 1,722 2,687 4,409 Accounts 10,218 - - 10,218 Intrafund receivable 111,607 728,845 - (840,452) - Prepaid items 5,033 - . 5,033 - Notes receivable 127,246 191,541 - 318,787 110,748 Land held for resale 2,883,058 163,200 3,046,258 TOTAL ASSETS $ 5,253,901 $ 1,247,646 $ $ 778,295 $ 37,719 $ 104,142 $ 685,173 $ 55,800 $ 34,654 $ 80,22 7 $ 78 1,671 $ $ $ $ $ (840,452) $ 7,559,594 $ 939,501 LIABILITIES Accounts and contracts payable $ 16,639 $ $ $ $ $ $ $ $ $ $ $ - $ 127,246 $ $ $ $ 143,885 $ Intrafund payable - 45,363 4,644 728,845 400 400 400 400 (840,452) - Uneamed revenue - - 163,200 - - - - - - (163,200) - Escrow deposits 5,492 5,492 Total liabilities 22,131 45,363 163,200 644 728,845 400 127,646 400 400 (1,003,652) 149,377 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 1,7222 - - - - - - - - - - - - - 4,409 - FUND BALANCES Nonspendable 5,033 5,033 Restricted - 1,247,646 778,295 37,719 9,286 ,800 15,583 77,340 13,478 (697,174) (400) (127,646) (400) (400) 163,200 2,221,123 939,501 Assigned Economic Development 5,025,015 - (45,363) - - - - - - - - 4,979,652 - Fagade Grant 200,000 - - - - - - - - - - - - - - 200,000 - Total fund balance 5,230,048 1,247,646 45,3 778,295 37,71 104,142 5 55,800 34,654 15,583 77,340 13,478 (697,174) (400) (127,646) (400) (400) 163,200 7,405,808 939,501 TOTAL LIABILITIES, AND FUND BALANCES $ 5,253,901 $ 1,247,646 $ 778,295 $ 719 104,142 685,1 $ 55,800 $ 34,654 $ 80,227 $ 77,340 $ 13,478 $ 31,671 $ $ $ $ -L (840,452) $ 7,559,594 $ 939,501 Required or Actual Decertification Date 9/2013 12/3 2018 2/31/2023 12/31/2026 12/31/2029 12/31/2029 12/31/2022 1213112045 1213112031 12131/2050 12/31/2050 12131/2050 12/31/2032 TIF District Type elopment Ho Re ment Housing 8 Housing Housing Housing Redevelopment Housing Economic Housing Housing Redevelopment Economic (d) = decertified Redevelopment Development Development Schedule of Revenues, Expenditures and Other Financing Sources (Uses) Economic Development Authority & Small Cities Development Program For the Period Ended December 31, 2023 - Unaudited Revenues Property taxes Tax increments Intergovernmental Investment earnings Interest on loans Other revenues Total revenues Expenditures: Current Salary and wages Benefits Supplies Professional services - legal Professional services - other LPV Insurance Legal and general publications Marketing Dues and membership Utilities IT services Travel and conferences Other expenditures Excess increments Interest on intrafund loans PAYG payments to third parties Total expenditures Excess (deficiency) of revenues over expenditures Other financing uses Transfers in Net change in fund balances Fund balance at beginning of year Fund balance at end of yeas Required or Actual Decertification Date TIF District Type (d) = decertified 138,697 48,091 35 21,780 156,883 3,395 398 5,000 6,796 789 3,473 5,120 295,753 686,210 TIF 6 (d) TIF 19 (d) TIF 20 (d) TIF 22 (d) TIF 24 TIF 29 TIF 30 TIF 34 (d) TIF 40 TIF 41 TIF 42 EDA General GMEF TIF Future Raindance MS Shores Prairie West Downtown St. Henry's Front Porch CMHP Interchange Briggs UMC Headwaters (31,257) 3,481 3,344 3,300 (31,257) 1,449,767 41,292 $ 401,807 $ $ $ $ - $ $ - $ - $ - $ - $ $ - $ - $ - 37,749 269,641 55,830 34,684 17,576 70,020 65,098 284,123 - - - - - - - 206,458 1,963 3,481 29,294 3,300 897,651 3,481 29,294 37,749 269,641 55,830 34,684 17,576 70,020 65,09 138,697 48,091 35 21,780 156,883 3,395 398 5,000 6,796 789 3,473 5,120 295,753 686,210 Total 211,441 3,481 3,950 SCDP 215,391 3,481 5,014,657 1,244,165 (45,363) $ 5,230,048 $ 1,247,646 $ (45,363) Redevelopment CITY OF MONTICELLO IF 43 TIF 45 TIF 46 GAAP Total Total aters Block 52 WiHa Reconciliation EDA SCDP $ $ $ $ 401,807 $ 550,598 284,123 - 206,458 37,948 (31,257) 3,481 3,344 3,300 (31,257) 1,449,767 41,292 138,697 48,091 - 35 1,000 22,780 - 1,468 400 400 400 400 159,951 - - - - - - - 3,395 30 30 30 30 0 30 30 30 224 862 - - - - 5,000 6,796 789 3,473 5,120 295,753 0,20 - - 180,209 1,963 - 29,294 (31,257) - 63,018 63,018 3 1 9 30 1,993 30 63,048 30,986 400 400 400 400 (31,257) 933,969 ,719 (30) 88,4 55,800 34,654 15,583 (30) 6,972 34,112 (400) (400) (400) (400) 515,798 41,292 3,950 9 (30) 88,402 55,800 34,654 15,583 (30) 6,972 34,112 (400) (400) (400) (400) 519,748 41,292 104,172 430,884 - 77,370 6,506 (731,286) (127,246) - 163,200 6,886,060 898,209 7,719 $ 104,142 $ 519,286 $ 55,800 $ 34,654 $ 15,583 $ 77,340 $ 13,478 $ (697,174) $ (400) $ (127,646) $ (400) $ (400) $ 163,200 $ 7,405,808 $ 939,501 12/31/2023 12/10/2018 12/31/2023 12/31/2026 12/31/2029 12/31/2029 12/31/2022 12/31/2045 12/3112030 12/31/2050 12/31/2050 12/31/2050 12/31/2032 Housing Redevelopment Housing 8 Housing Housing Housing Redevelopment Housing Economic Housing Housing Redevelopment Economic Redevelopment Development Development EDA Agenda: 2/14/2024 4A. Consideration of Approving Payment of Bills Prepared by: Meeting Date: ❑ Regular Agenda Item Community & Economic Development 2/14/2024 ® Consent Agenda Item Coordinator Reviewed by: Approved by: N/A Economic Development Manager REFERENCE AND BACKGROUND: Accounts Payable summary statements listing bills submitted during the previous month are included for review. ALTERNATIVE ACTIONS: 1. Motion to approve payment of bills through January 2024. 2. Motion to approve payment of bills through January 2024 with changes as directed by the EDA. STAFF RECOMMENDATION: Staff recommend approval of Alternative 1. SUPPORTING DATA: A. Accounts Payable Summary Statements for January. Accounts Payable Transactions by Account User: julie.cheney Printed: 01/03/2024 - 3:06PM Batch: 00204.01.2024 Account Number Vendor Description Monticello GL Date Check No Amount PO No 213-46301-430400 KENNEDY AND GRAVEN CHAR] 7th Stree W Parcel Acquisition from R 12/31/2023 128009 1,064.75 213-46301-430400 KENNEDY AND GRAVEN CHAR] General EDA- Nov 2023 12/31/2023 128009 1,561.50 Vendor Subtotal: 2,626.25 213-46301-433100 JAMES THARES Mileage Reimbursement - Nov/Dec (9 12/31/2023 0 63.53 Vendor Subtotal: 63.53 213-46301-443300 INITIATIVE FOUNDATION 2024 Endowment Contribution 01/09/2024 128005 2,390.00 Vendor Subtotal: 2,390.00 213-46301-443990 VONCO II LLC Clean Up Cedar Fair Site - EDA 12/31/2023 128038 86.23 Vendor Subtotal: 86.23 Subtotal for Fund: 213 5,166.01 Report Total: 5,166.01 AP -Transactions by Account (01/03/2024 - 3:06 PM) Page 1 Accounts Payable Transactions by Account User: julie.cheney Printed: 02/01/2024 - 1:15PM Batch: 00207.01.2024 Account Number Vendor Description Monticello GL Date Check No Amount PO No 213-46301-431990 WSB & ASSOCIATES INC Phase EDA- Riverwood Bank Parcel 12/31/2023 0 4,080.00 Vendor Subtotal: 4,080.00 213-46301-431993 WSB & ASSOCIATES INC 2023 Economic Development Service; 12/31/2023 0 2,267.50 Vendor Subtotal: 2,267.50 Subtotal for Fund: 213 6,347.50 Report Total: 6,347.50 AP -Transactions by Account (02/01/2024 - 1:15 PM) Page 1 Accounts Payable Transactions by Account User: julie.cheney Printed: 01/17/2024- 1:33PM Batch: 00202.01.2024 Account Number Vendor Description Monticello GL Date Check No Amount PO No 213-46301-421990 US BANK CORPORATE PMT SYS HOME DEPOT - Thermostat for 2161 12/31/2023 0 29.98 Vendor Subtotal: 29.98 213-46301-438200 CITY OF MONTICELLO 7256-004 - 130 Brdwy- Stormwtr 12/31/2023 0 29.75 213-46301-438200 CITY OF MONTICELLO 7256-015 - 216 Pine St - EDA 12/31/2023 0 49.85 Vendor Subtotal: 79.60 213-46301-443990 US BANK CORPORATE PMT SYS MONTICELLO CHAMBER OF CON 12/31/2023 0 20.00 213-46301-443990 US BANK CORPORATE PMT SYS DOMINOS PIZZA LLC - Pizza for EI 12/31/2023 0 45.64 Vendor Subtotal: 65.64 Subtotal for Fund: 213 175.22 Report Total: 175.22 AP -Transactions by Account (01/17/2024 - 1:33 PM) Page 1 Accounts Payable Transactions by Account User: julie.cheney Printed: 02/01/2024 - 1:13PM Batch: 00208.01.2024 Account Number Vendor Description Monticello GL Date Check No Amount PO No 213-46301-431991 DEMVI LLC Parking Lot Maintenance - Jan 2024 01/31/2024 0 213.86 Vendor Subtotal: 213.86 213-46301-438100 CENTERPOINT ENERGY 12045691-8 - 216 Pine St 01/31/2024 0 175.60 Vendor Subtotal: 175.60 Subtotal for Fund: 213 389.46 Report Total: 389.46 The preceding list of bills totaling $12,078.19 was approved for payment. Date: 2/14/24 Approved by: Hali Sittig - Treasurer AP -Transactions by Account (02/01/2024 - 1:13 PM) Page I MINUTES REGULAR MEETING - ECONOMIC DEVELOPMENT AUTHORITY (EDA) Wednesday, January 10, 2024 — 6:00 p.m. Mississippi Room, Monticello Community Center Commissioners Present: President Steve Johnson, Vice President Jon Morphew, 011ie Koropchak-White, Rick Barger, Councilmember Tracy Hinz, Mayor Lloyd Hilgart Commissioners Absent: Treasurer Hali Sittig Staff Present: Executive Director Jim Thares, Angela Schumann, Hayden Stensgard 1. General Business A. Call to Order President Steve Johnson called the regular meeting of the Monticello EDA to order at 6:05 p.m. B. Roll Call 6:00 p.m. President Johnson called the roll. C. Consideration of Additional Agenda Items None 2. Consent Agenda A. Consideration of Payment of Bills B. Consideration of Approving Regular Meeting Minutes — December 13, 2023 C. Consideration of Approving Workshop Meeting Minutes — December 13, 2023 LLOYD HILGART MOVED TO APPROVE THE JANUARY 10, 2024 REGULAR MEETING CONSENT AGENDA. RICK BARGER SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY, 6-0. 3. Public Hearin N/A 4. Regular Agenda A. Consideration of Greater Monticello Enterarise Fund (GMEF) Loan Pre-Armlication in the amount of $300,000 from Deephaven Development for commercial property improvements at 101 West Broadway Executive Director Jim Thares provided an overview of the agenda item to the EDA and the public. The EDA was asked to consider a GMEF loan pre -application request for $300,000 to assist with a tenant space build out within the commercial area of the Block 52 Redevelopment project. The total buildout space on the first floor of the new building is roughly 13,300 square feet and will consist of approximately $2,000,000 in improvements. Block 52 Holdings noted they have a 10 -year lease for the space with new tenant, Simplicity Financial Group, that is anticipated to bring 102 full-time equivalent jobs to the building. Mayor Hilgart referenced the current GMEF fund balance of around $1,055,000 and if there was a process for replenishing the fund, if necessary, in the future. Mr. Thares noted that any given GMEF application is only eligible for half of the fund balance at the time of application. The EDA has the authority to waive this guideline, as well as allocating more funds as necessary. 011ie Koropchak-White noted that the limitation for requests to be maxed out at half fund balance is a guideline adopted at the time the program was created, to ensure there would be funds available at all times. As the program continues to progress, that guideline could be re-evaluated and amended as necessary. President Johnson asked what the anticipated interest rate would be for the subject GMEF loan. Mr. Thares noted that it would be two percent below prime, which is 6.5%. Mr. Thares noted the applicants are requesting this GMEF loan to be at 3% interest for the $300,000. Brendan Muldoon, of the applicant team, addressed the EDA and the public. Mr. Muldoon gave background on the future tenant of the subject space. He said that Simplicity Group is a large nationwide financial firm based in New Jersey. Mayor Hilgart believed the results from this commercial space being filled up and built out for use will benefit all businesses within the downtown area. Vice President Jon Morphew appreciated the efforts from the Block 52 development team attracting prospective tenants to these available spaces. Ms. Koropchak-White also appreciated the work done to fill up the commercial spaces of the building. President Johnson asked how parking will be managed in the area with the addition of 100 +/- employees, and more to come as more commercial and residential tenants move in. Mr. Muldoon noted that the City has conducted studies that indicate that there is sufficient parking within the vicinity of the block. He further stated that this will need to be monitored to proactively make any necessary adjustments. Angela Schumann, Community Development Director, echoed Mr. Muldoon's statements on parking and noted the City has prepared short-term and long-term parking solutions to be utilized as necessary. Vice President Morphew asked if the loan is contingent on a signed lease. Mr. Thares said the tenant has already signed the lease. Per Business Subsidy statutes, the applicants are required to meet certain job creation goals which will be fulfilled by the tenant. Councilmember Tracy Hinz also expressed gratitude towards the development team for their efforts throughout the redevelopment project. OLLIE KOROPCHAK-WHITE MOVED TO AUTHORIZE STAFF TO PROCEED WITH FURTHER DUE DILIGENCE RELATED TO THE LOAN CREDIT REQUEST AND PREPARATION OF A LOAN AGREEMENT FOR CONSIDERATION AT A FUTURE MEETING. TRACY HINZ SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY, 6-0. B. Consideration of Authorizine enterine into Professional Services Contract with WSB & Associates in the amount of $8,400 for completion of Phase I Environmental Site Assessment (ESA) and ARM (Asbestos and Regulated Materials) Survey of 216 Pine Street Mr. Thares provided an overview of the agenda item to the EDA and the public. Recently purchased property by the EDA, 216 Pine Street requires a Phase I ESA and ARM Survey prior to any redevelopment efforts on the block. The specific request is only for 216 Pine Street, and any other property on the block to be redeveloped will have these same steps completed as necessary. Rick Barger asked if these two environmental steps were only on the building or for the land as well. Mr. Thares clarified that the Phase I ESA will cover both the land and the building, and the ARM Survey is specific to the building. JON MORPHEW MOVED TO AUTHORIZE A PROFESSIONAL SERVICES CONTRACT WITH WSB & ASSOCIATES FOR COMPLETION OF A PHASE I ESA (ENVIRONMENTAL SITE ASSESSMENT) AND AN ARM SURVEY (ASBESTOS REGULATED MATERIALS) SURVEY AT 216 PINE STREET IN THE AMOUNT OF $8,400. LLOYD HILGART SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY, 6-0. C. Consideration of Authorizing entering into a Professional Services Contract with WSB & Associates in the amount of $4,800 for completion of a Phase I Environmental Site Assessment (ESA) of 118 East Broadway Mr. Thares provided an overview of the agenda item to the EDA and the public. A companion item to the prior one of this agenda. The proposed Phase I work at 118 Broadway East would take place as necessary steps prior to any redevelopment efforts on Block 34. President Johnson noted that these environmental steps being completed proactively by the EDA will benefit their efforts in advertising the block for redevelopment. MAYOR LLOYD HILGART MOVED TO AUTHORIZE A PROFESSIONAL SERVICES CONTRACT WITH WSB & ASSOCIATES FOR COMPLETION OF A PHASE I ESA (ENVIRONMENTAL SITE ASSESSMENT) AT 118 BROADWAY EAST IN THE AMOUNT OF $4,800. OLLIE KOROPCHAK-WHITE SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY, 6-0. D. Consideration of Authorizing an Amendment to the Downtown Facade Improvement Forgivable Loan Program Guidelines and Eligibility Area Community & Economic Development Coordinator Hayden Stensgard provided an overview of the agenda item to the EDA and the public. President Johnson asked if renderings completed through the applicant for proposed improvements could be included in the funding for the work to be done. Mr. Stensgard said that the current guidelines do not specifically call out the renderings as an eligible item for loan funds, but the EDA has the latitude and discretion to decide whether they are eligible on a case-by-case basis. Ms. Schumann clarified that the typical process for the loan program would consist of the EDA deciding to authorize completion of renderings for a building, or have the applicants provide prior to a formal application submittal. President Johnson asked if the guidelines define what the eligible facades are for a given building. Mr. Stensgard clarified that the eligible facades for improvement as mentioned in the guidelines are those adjacent to public streets. The EDA has the discretion as well to authorize funds for additional facades if requested by the applicant, on a case-by-case basis. Vice President Morphew asked if the 109 Walnut Street property is planning to move forward with their application if the eligibility area is amended to include that property. Mr. Stensgard confirmed. Ms. Schumann further clarified that the specific language only alludes to front and interior side facades as eligible portions of buildings for the program. If the EDA wishes to include language allowing applicants to request facades beyond what is acknowledged, they should direct staff to make that addition. Mayor Hilgart noted he did not have an issue with potential applicants applying for multiple sides, as long as the front fagade is included in the proposed improvements. Vice President Morphew concurred and stated that his thoughts on that would have been different, had there been more initial interest from property owners for the program. Councilmember Hinz appreciated the added flexibility in the policy language for both EDA and the potential applicants but wants to ensure that EDA maintains integrity in approving projects within this program. RICK BARGER MOVED TO ADOPT THE PROPOSED AMENDMENTS TO THE DOWNTOWN FACADE IMPROVEMENT FORGIVABLE LOAN PROGRAM POLICY AND ELIGIBILITY AREA, INCLUDING ADDED LANGUAGE TO ALLOW EDA DISCRETION FOR APPROVAL OF BUILDING SIDE IMPROVEMENTS BEYOND FRONT AND INTERIOR SIDE FACADES. JON MORPHEW SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY, 6-0. 5. Other Business A. Consideration of Economic Development Manager's Report Mr. Thares provided an overview of the agenda item to the EDA and the public. No action was taken on the item. 6. Adjournment TRACY HINZ MOVED TO ADJOURN THE REGULAR MEETING OF THE MONTICELLO EDA. OLLIE KOROPCHAK-WHITE SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY, 6-0. MEETING ADJOURNED AT 7:11 P.M. EDA Agenda: 02/14/2024 4C. Consideration of Resolution 2024-01 approving conveyance of 4.81 -acre stormwater parcel, Outlot A, Great River Addition, to the City Prepared by: Meeting Date: ❑ Regular Agenda Item Economic Development Manager 02/14/2024 ® Consent Agenda Item Reviewed by: Approved by: Community Development City Administrator Director, Finance Director, City Engineer ACTION REQUESTED Motion to adopt EDA Resolution 2024-01 approving the conveyance of a 4.81 -acre stormwater storage pond parcel, Outlot A, Great River Addition, to the City. REFERENCE AND BACKGROUND The EDA is asked to approve Resolution 2024-01 conveying a stormwater parcel along 7th Street West to the City. The 4.81 -acre parcel was recently acquired by the EDA (December 2023) as part of the vacant land acquisition from Riverwood Bank. While the City had an easement over the parcel for any needed drainage system improvements, Riverwood Bank offered the stormwater storage pond site to the EDA as part of the land sale package as Riverwood Bank did not want the land tract on its books due to banking regulations. At the time of the purchase, staff felt it would be prudent to have the EDA acquire the stormwater pond site along with 14.61 -acre vacant development parcel. Wright County's 2023 taxable market value of the parcel is $10,500. City staff have filed the paperwork with the County to categorize this parcel as tax exempt for the future. If the EDA approves the conveyance of the parcel, it will also be presented to the City Council for acceptance. An aerial photo and the plat illustration of the parcel are included in the exhibits in this report. Budget Impact: The budget impact to the EDA's General Fund budget related to the land conveyance is minimal. Minor legal costs have been incurred related to the preparation of the EDA Resolution. II. Staff Workload Impact: The EDA attorney prepared the Resolution attached to the staff report. In-house staff involved in this effort consisted of the Community Development Director, Finance Director and the Economic Development Manager. III. Comprehensive Plan Impact: N/A EDA Agenda: 02/14/2024 STAFF RECOMMENDATION Staff recommend adoption of EDA Resolution 2024-01 conveying the 4.81 -acre stormwater parcel to the City. The site is not developable and is dedicated for the purpose of serving as part of the regional stormwater management system in this general area along 7t" Street West. SUPPORTING DATA A. EDA Resolution 2024-01 B. Quit Claim Deed C. Aerial Photo and WC Beacon Information Report D. Plat Illustration — Outlot A, Great River Addition CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. 2024-01 RESOLUTION AUTHORIZING CONVEYANCE OF CERTAIN REAL PROPERTY TO THE CITY OF MONTICELLO WHEREAS, the City of Monticello Economic Development Authority (the "Authority") is the owner of certain real property located in Wright County, Minnesota and legally described as Outlot A, Great River Addition (the "Property"); and WHEREAS, the City of Monticello, Minnesota (the "City") is interested in owning the Property; and WHEREAS, the Authority has determined that it is in the best interest of the public to convey the Property to the City; and WHEREAS, the Authority and the City have followed applicable statutory provisions, including but not limited to, Minnesota Statutes, Sections 465.035 and 471.64. NOW THEREFORE, BE IT RESOLVED by the Board of Commissioners of the City of Monticello Economic Development Authority as follows: 1. The recitals set forth in the preamble to this resolution and the exhibits attached to this resolution are incorporated into this resolution as if fully set forth herein. 2. The conveyance of the Property by the Authority to the City is hereby authorized pursuant to a quit claim deed. 3. The Board hereby authorizes the President and Executive Director, in their discretion and at such time, if any, as they may deem appropriate, to execute on behalf of the Authority all appropriate documents to convey title of the Property to the City, included but not limited to a quit claim deed (the "Conveyance Documents"), and to carry out, on behalf of the Authority, the Authority's obligations thereunder when all conditions precedent thereto have been satisfied. The Conveyance Documents shall be in substantially the form on file with the Authority and the approval hereby given to the Conveyance Documents includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the Authority and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the Authority. The execution of any instrument by the appropriate officers of the Authority herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. This resolution shall not constitute an offer and the Conveyance Documents shall not be effective until the date of execution thereof as provided herein. 1 4. In the event of absence or disability of the officers, any of the documents authorized by this resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by such other officer or officers of the Board as, in the opinion of the City Attorney, may act in their behalf. Upon execution and delivery of the Conveyance Documents, the officers and employees of the Board are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the Board to implement the Conveyance Documents. Approved by the Board of Commissioners of the City of Monticello Economic Development Authority on February 14, 2024. ATTEST: Executive Director 2 President QUIT CLAIM DEED Deed Tax Due: $ Consideration for this transfer is less than $3000.00. ECRV:NA Date: FOR VALUABLE CONSIDERATION, the City of Monticello Economic Development Authority, a public body corporate and politic under the laws of the State of Minnesota, Grantor, hereby conveys and quitclaims to the City of Monticello, Minnesota, a municipal corporation under the laws of the State of Minnesota, Grantee, real property in Wright County, Minnesota, described as follows: Outlot A, Great River Addition. Check here if part or all of the land is Registered (Torrens) O together with all hereditaments and appurtenances. X The Seller certifies that the Seller does not know of any wells on the described real property. ❑ A well disclosure certificate accompanies this document or has been electronically filed. (If electronically filed, insert WDC number: ). ❑ I am familiar with the property described in this instrument and I certify that the status and number of wells on the described real property have not changed since the last previously filed well disclosure certificate. MN325\50\927809.v1 GRANTOR: CITY OF MONITCELLO ECONOMIC DEVELOPMENT AUTHORITY By Steven Johnson, President By James Thares, Executive Director STATE OF MINNESOTA SS COUNTY OF WRIGHT The foregoing was acknowledged before me this day of , 2024, by Steven Johnson and James Thares, the President and Executive Director, respectively of the City of Monticello Economic Development Authority, a public body corporate and politic under the laws of the State of Minnesota (the "Authority"), on behalf of the Authority, Grantor. NOTARY STAMP This instrument was drafted by Kennedy & Graven, Chartered 150 South Fifth Street, Suite 700 Minneapolis, MN 55402 (612) 337-9300 MN325\50\927809.v1 SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT Tax Statements should be sent to: City of Monticello, Minnesota 505 Walnut Street, #1 Monticello, MN 55362 Beacon i r"FWright County, M N (r7) ua,4- L ci- 4, 4�-Oe--Afi- C1,10- V'r Date created: 2/6/2024 Last Data Uploaded: 2/6/202411:19:26 AM Developed by" Schneider GEOSPATIAL Overview 4.V I 1� f Legend Roads CSAHCL — CTYCL --- MUNICL --� PRIVATECL — TWPCL Highways ° Interstate State Hwy US Hwy City/Township Limits ® c 0 t Q Parcels Torrens 2/6/24, 3:19 PM Beacon - Wright County, MN - Report: 155226000010 Wright County, MN Summary Parcel ID 155226000010 Property Address Sec/Twp/Rng 11-121-025 Brief Tax SECT-11TWP-121 RANGE -025 GREAT RIVER ADDITION Description OUTLOT A (Note: Not to be used on legal documents) Class 233 - 3A COMMERCIAL LAND AND BUILDING District (1101) CITY OF MONTICELLO-0882 School District 0882 Transfer History (Note: Class refers to Assessor's Classification Used For Property Tax Purposes) GIS Acres Parcel: 155226000010 Acres: 4.81 Acres USAB: 4.81 Acres WATE: 0.00 Acres ROW: 0.00 Sq Ft: 209,686.52 Owner Primary Owner CITYOF MONTICELLO EDA %EXECUTIVE DIRECTOR 505 WALNUT ST SUITE 1 MONTICELLO MN 55362 Land Unit Eff Seq Code CER Dim 1 Dim 2 Dim 3 Units UT Price Adj 1 Adj 2 Adj 3 Rate Div % Value 1 Cl WASTE 0 0 0 0 209,686.000 S 0.050 0.00 0.00 0.00 0.050 1.000 10,500 Total 209,686.000 10,500 Recent Sales In Area Sale date range: From: 02/06/2021 To: 02/06/2024 Sales by Neighborhood `,)Ae5 by Subdivision 1500 Feet v `=ales by Distance Transfer History Grantor Grantee Recorded Date Doc Type Doc No RIVERWOOD BANK CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY 12/20/2023 LWD 1544725 RIVERWOOD BANK; CITY OF MONTICELLO GREAT RIVER ADDITION 12/9/2013 PLT 1253597 Note: Transfer History data is from Land Link beginning 01/01/2003. Valuation 2023 Assessment 2022 Assessment 2021 Assessment 2020 Assessment 2019 Assessment + Estimated Land Value $10,500 $6,700 $4,800 $4,800 $4,800 + Estimated Building Value $0 $0 $0 $0 $0 + Estimated Machinery Value $0 $0 $0 $0 $0 = Total Estimated Market Value $10,500 $6,700 $4,800 $4,800 $4,800 % Change 56.72% 39.58% 0.00% 0.00% 0.00% https://beacon.schneidercorp.com/Application.aspx?APPID=187&LaverlD=2505&PageTvpelD=4&PagelD=1310&KevValue=155226000010 1/3 2/6/24, 3:19 PM Taxation Beacon - Wright County, MN - Report: 155226000010 Map No data available for the following modules: Land GA/RP, Buildings, Extra Features, OBY, OBY (Working 2024 Assessment), Sales, Photos, Sketches. https:Hbeacon.schneidercorp.com/Application.aspx?ApplD=187&LaverlD=2505&PageTvpelD=4&PagelD=1310&KevValue=155226000010 2/3 2022 Payable 2021 Payable 2020 Payable 2019 Payable Estimated Market Value $4,800 $4,800 $4,800 $4,800 - Excluded Value $0 $0 $0 $0 - Homestead Exclusion $0 $0 $0 $0 = Taxable Market Value $4,800 $4,800 $4,800 $4,800 Net Taxes Due $136.00 $136.00 $140.00 $144.00 + Special Assessments $0.00 $0.00 $0.00 $0.00 = Total Taxes Due $136.00 $136.00 $140.00 $144.00 Change 0.00%" ; g'% 0.00% Taxation (Preliminary 2023 Taxes Payable) 2023 Proposed 2022 Payable Estimated Market Value $6,700 $4,800 - Excluded Value $0 $0 - Homestead Exclusion $0 $0 = Taxable Market Value $6,700 $4,800 Net Taxes Due $174.00 $136.00 + Special Assessments $0.00 $0.00 = Total Taxes Due $174.00 $136.00 % Change 27.94% 0.00% Taxes and Special Assessments Payable in 2023 are preliminary. Taxes Paid Receipt # Receipt Print Date Bill Pay Year Amt Adj Amt Write Off Amt Charge Amt Payment 1802712 10/14/2022 2022 $0.00 $0.00 $0.00 ($68.00) 1763859 5/11/2022 2022 $0.00 $0.00 $0.00 ($68.00) 1729628 10/14/2021 2021 $0.00 $0.00 $0.00 ($68.00) 1693460 5/11/2021 2021 $0.00 $0.00 $0.00 ($68.00) 1655059 10/15/2020 2020 $0.00 $0.00 $0.00 ($70.00) 1609925 5/7/2020 2020 $0.00 $0.00 $0.00 ($70.00) 1578690 10/15/2019 2019 $0.00 $0.00 $0.00 ($72.00) 1546095 5/15/2019 2019 $0.00 $0.00 $0.00 ($72.00) 1498075 10/12/2018 2018 $0.00 $0.00 $0.00 ($69.00) 1467459 5/16/2018 2018 $0.00 $0.00 $0.00 ($69.00) 1422862 10/16/2017 2017 $0.00 $0.00 $0.00 ($70.00) 1373150 5/9/2017 2017 $0.00 $0.00 $0.00 ($70.00) 1322577 10/11/2016 2016 $0.00 $0.00 $0.00 ($74.00) 1291558 5/16/2016 2016 $0.00 $0.00 $0.00 ($74.00) Map No data available for the following modules: Land GA/RP, Buildings, Extra Features, OBY, OBY (Working 2024 Assessment), Sales, Photos, Sketches. https:Hbeacon.schneidercorp.com/Application.aspx?ApplD=187&LaverlD=2505&PageTvpelD=4&PagelD=1310&KevValue=155226000010 2/3 GREAT RIVER ADDITION ---------- L Ill ELM p - - - - - - - - - - - - - --- - - - - - - Lo A Tin.. - — - — - — - — - — - OUTLOT A -: /� Pgar \1� '5* ..j4 m7.lt.4Tw AINQc�7�. 0.00 1�1 l - .- ,. - - aeclnwnTow/allm.,axoEa k•. tanGs.e+wreSOrArrll�r �•r]y ( m "N y IMAM faAr2nrarMOH•.uW/z \\ I I •�� IA - - - - - - - - --- ORAJOHMEANDUM11Y e�ueeYnBeo- OUTLOT C-- 33.004- ',/-WMWrAS7FMFF — — — — — — .34,40"t 3373. 3*0 tt. 33 =&AMM FFFFFF .00 I73A/I 77M BIRMEr .1.1 smwp 42. 33 A SS"53'44'E 221.17 7. MV59-n-W afto. OUTLOT 9 :71 1 SII � 14 -40. 09 34.31 WBO■R/I�oTOSMgOI1MMr i1 Sol THE NORTH LINE OF THE WORIN In SW"IEAST 43 Yww�[oonYraN�,r 114 SECTION 10. TOWNSHIP 12'; RAMM 25 HAS AN AMMED BEAMING or S B-A-22-E mxwhkmwsw^ao wwwk som 0416 ------- WSB ww."bm*=" Owe MOMENNO, FLANNIM. SHEET 20F2 EDA Agenda: 02/14/2024 5A. PUBLIC HEARING - Consideration of Resolution 2024-02 approving GMEF Loan to Buchholz -Block 52 Holdings in the amount of $300,000 for Project Simple Office Space at 101 West Broadway Prepared by: Meeting Date: ® Public Hearing Economic Development Manager 02/14/2024 ❑ Regular Agenda Item Reviewed by: Approved by: Community Development City Administrator Director, Finance Director, City Engineer Motion to adopt EDA Resolution 2024-02 authorizing a GMEF Loan to Block 52 Holdings, LLC in the amount of $300,000 for the Project Simple office build out at 101 West Broadway, contingent on completed loan analysis summary report by Riverwood Bank with satisfactory recommendation. REFERENCE AND BACKGROUND The EDA is asked to approve Resolution 2024-02 authorizing a $300,000 GMEF Loan to Block 52 Holdings, LLC for the purpose of completing the build out of office space in the new Block 52 building located at 101 West Broadway. A preliminary review of the loan request was presented to the EDA at its January 10, 2024, regular EDA meeting. The EDA directed staff to have various documents, including a Loan Agreement, Promissory Note and Mortgage completed and presented for consideration at the February 14, 2024, meeting. The proposed property improvements are for the build out of a 13,303 square foot office space on the ground floor of 101 West Broadway for Simplicity Group, a financial service and wealth enhancement firm. Simplicity Group is a national firm and has decided to increase its scale and presence in the greater Twin Cities metro area. They have committed to a 10 -year lease at the building and are expected to house 102 FTE employees at this location. Block 52 Holdings previously secured financing from its lender and the EDA in the form of a TIF development agreement along with a gap funding "Authority Grant" to complete the majority of the development. The buildout of the office space is a separate work component and financial consideration. The projected cost of the office buildout is $2,000,000 or $150.00 per square foot. Block 52 EDA Agenda: 02/14/2024 Holdings has secured bank financing for 67.5 percent of the project cost and is contributing cash equity equal to 17.5 percent of the dollars needed to complete the build out. The entity is seeking a GMEF gap funding loan in the amount of $300,000 (15 percent) to cover the balance. A summary of the proposed funding sources for the buildout project is shown below. Sources Amount Percent Bank $1,350,000 67.50 Dev Cash Equity $ 350,000 17.50 GMEF Loan $ 300,000 15.00 Total $2,000,000 100.00 As noted in the application materials, the project will result in 102 FTE employees being housed in the office. While the GMEF program has in the past been more commonly used to fund manufacturing or other business -specific equipment, the proposed use of funds will support an influx of employment into the downtown during daytime hours. The improvements will enhance the significant investments, both public and private, on the block. The new workers downtown may also bring economic spin-off impacts to other businesses and existing and future restaurants near Block 52. The taxable market value of the entire property is likely to increase as well due to the significant additional improvements being completed at the building. Currently, the GMEF Loan Fund cash balance is approximately $1,056,105 +/-. The proposed use of the funding request is an eligible use of the funds. Riverwood Bank is completing a credit memo to ensure unnecessary risk in lending funds for this project is minimized to the EDA. However, as 3rd mortgagor, the EDA is accepting an inherent level of risk. Since Block 52 Holdings is not responsible for creating the new jobs, it will be required to obtain information from Simplicity Group to complete annual reports documenting compliance with the Business Subsidy statute. Key loan terms are noted below: 1. Loan Amount: $300,000 (15 percent of the total project funding) 2. Loan Term = 25 -year amortization with a 101h year balloon payment (120th month) 3. Interest Rate = Fixed; 3.5 percent 4. Collateral = 3rd Real Estate Mortgage 5. Loan Close Date = TBD 6. Deferral Period: P & I loan payments to start November 1, 2024; interest will accrue from funding draw dates 7. Job Creation= 50 FTE jobs due to GMEF Loan funding 8. Loan Origination Fee = 1.5 percent; $4,500 It should be noted that the borrower requests a waiver of the GMEF Loan Policy language regarding interest rates in asking for 3.0 percent rate. The EDA has the authority to deviate EDA Agenda: 02/14/2024 from the Policy if it determines it is beneficial to desired outcomes. The Policy language indicates that interest rates should be 2 points below the "Wall Street Journal Prime Rate". The WSJ Prime Rate is currently 8.5 percent meaning the GMEF loan would carry a rate of 6.5 percent. There is currently widespread belief that Federal Reserve will begin reducing fed funds rates in 2024 (the Fed raised interest rates 11 times since March 2022 with goal of reducing inflation). If the rate reductions occur, it is reasonable for the borrower to seek a fixed rate that is more in line with soon (over the next 18 to 24 months) to be expected rates. The staff recommended 3.5 percent loan rate is slightly below the current 10 -year treasury rate of 4.07 percent. The agreements drafted for EDA consideration currently include the 3.5 percent rate. The loan documents presented for the EDA review and consideration include the following: • Loan Agreement • Mortgage Agreement • Promissory Note Per Minnesota State statutes, the EDA will need to hold a Business Subsidy public hearing for this item and accept comments from the general public. Factors relevant for the Business Subsidy consist of job creation and additional tax base due to the project. Since the loan exceeds $150,000, the City Council is also required to review the loan request and authorize it through a Resolution. That review and consideration is planned for the February 26, 2024, City Council meeting. The EDA public hearing notice is attached to this report as exhibit G. Budget Impact: The budget impact from the proposed GMEF Loan request is a direct reduction in the balance of the loan fund. The funding would draw the Fund down to $756,105 +/-. The fund remains in compliance with the GMEF Policy for fund balance. Potential future loans may be constrained in amount due to the size of this request if approved by the EDA, but that is a variable risk. Attorney fees and loan review - underwriting fees have been incurred in the review of the loan application, though most if not all of those costs will be passed onto the applicant -borrower. II. Staff Workload Impact: The Economic Development Manager has committed time to completing tasks related to the review of the proposed loan request. Additional time toward this effort involves report preparation and EDA meeting presentation. No other staff are required to complete the work in this effort. III. Comprehensive Plan Impact: The Economic Development section of the Comprehensive Plan encourages formation of an effective economic development effort which creates a supportive business environment and builds a vibrant, thriving local economy. The Monticello 2040 Vision + Plan's Vision and Values statements support a vibrant Downtown, and the 2017 Downtown Small Area Plan specifically notes a mix of uses is critical, EDA Agenda: 02/14/2024 including those active at varying times of day. Utilization of the various EDA funding programs and tools for quality proposals is an actionable step in fulfilling the Vision and Downtown Small Area Plan's objectives. STAFF RECOMMENDATION Staff recommend approval of the GMEF Loan request from Block 52 Holdings, contingent on a satisfactory recommendation resulting from the completed Credit Memo findings by Riverwood Bank. The proposed loan meets the general intent of the GMEF Loan Policies. The gap loan request is a critical component of the buildout proposal. The community's economic benefits include significant new job creation in the Downtown, and an increase in the tax base. A review using the Development Assistance Worksheet Scoring form (with limited information) indicates the proposal carries a score of 33.5. This is comparable to UMC and Wiha Tools' recent expansion scores. Riverwood Bank's Credit Memo will help the EDA understand the likelihood of loan performance based on property cash flow and the financial capacity of the borrower (property ownership group) to service the debt associated with the project. SUPPORTING DATA: A. Resolution 2024-02 B. Loan Agreement C. Promissory Note D. Mortgage Agreement E. Summary Credit Memo prepared by Riverwood Bank — Not available F. GMEF Loan Application G. Public Hearing Notice H. 2023 Year End EDA Financial Statements EDA RESOLUTION NO.2024-02 RESOLUTION APPROVING A GREATER MONTICELLO ENTERPRISE FUND LOAN TO BLOCK 52 HOLDINGS LLC, BUCHHOLZ EXCHANGE LLC AND NORGREN EXCHANGE LLC, AND APPROVING CERTAIN LOAN DOCUMENTS IN CONNECTION THEREWITH BE IT RESOLVED BY the Board of Commissioners ('Board") of the City of Monticello Economic Development Authority (the "Authority") as follows: Section 1. Recitals. 1.01. The Authority administers its Greater Monticello Enterprise Fund revolving loan program (the "Program") pursuant to its authority under Minnesota Statutes, Sections 469.090 to 469.1081, as amended (the "EDA Act"), in order to assist businesses in the City of Monticello, Minnesota (the "City") with financing certain economic development activities to meet the goals set forth in the guidelines approved by the Authority for the Program (the "Guidelines"). 1.02. Block 52 Holdings LLC, Buchholz Exchange LLC, and Norgren Exchange LLC, each a Minnesota limited liability company (together, the "Borrower"), have requested financial assistance from the Authority in connection with the build out by the Borrower of approximately 13,303 square feet of commercial office space (the "Project') for use by Simplicity Financial Marketing Holdings Inc, a Delaware corporation (the "Tenant'), at the real property located at 101 West Broadway Street in the City (the "Property") legally described in Exhibit A attached to the Mortgage (as hereinafter defined). 1.03. The Authority and the Borrower desire to enter into a loan agreement (the "Loan Agreement') wherein the Authority agrees to make a loan pursuant to the Program and the Guidelines to the Borrower in the maximum amount of $300,000 (the "Loan") to pay a portion of the costs of the Project. The Loan will be evidenced by a promissory note (the "Note") and a third position Mortgage (the "Mortgage") to be executed and delivered to the Authority by the Borrower. 1.04. The Authority is a grantor as defined in Minnesota Statutes, Sections 1161993 to 116J.995, as amended (the "Business Subsidy Act'), is authorized to grant financial assistance (a "Business Subsidy") for private development, and has previously adopted criteria for awarding Business Subsidies that complies with the Business Subsidy Act. The Loan constitutes a Business Subsidy within the meaning of the Business Subsidy Act, the Loan Agreement includes a "business subsidy agreement' as required under the Business Subsidy Act, and on the date hereof, the Authority held a duly noticed public hearing regarding the provision of a Business Subsidy to the Borrower and the Tenant pursuant to the Loan Agreement. Section 2. Loan Documents Approved. 2.01. The Authority hereby approves the Loan Agreement, the Note, the Guaranty and the Mortgage in substantially the forms presented to the Board, including the business subsidy agreement in the Loan Agreement, together with any related documents necessary in connection therewith, including all documents, exhibits, certifications, or consents referenced in or attached to the Loan Agreement, the Note, the Guaranty and the Mortgage (the "Loan Documents"). MN325\52\930259.v2 2.02. The Board hereby authorizes the President and Executive Director, in their discretion and at such time, if any, as they may deem appropriate, to execute the Loan Documents on behalf of the Authority, and to carry out, on behalf of the Authority, the Authority's obligations thereunder when all conditions precedent thereto have been satisfied. The Loan Documents shall be in substantially the form on file with the Authority and the approval hereby given to the Loan Documents includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the Authority and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the Authority. The execution of any instrument by the appropriate officers of the Authority herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. This resolution shall not constitute an offer and the Loan Documents shall not be effective until the date of execution thereof as provided herein. 2.03. In the event of absence or disability of the officers, any of the documents authorized by this resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by such other officer or officers of the Board as, in the opinion of the City Attorney, may act in their behalf. Upon execution and delivery of the Loan Documents, the officers and employees of the Board are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the Board to implement the Loan Documents. Approved this 141}i day of February, 2024, by the Board of Commissioners of the City of Monticello Economic Development Authority. President ATTEST: Executive Director MN325\52\930259.v2 2 I KIL11 0 [[ 19 al Flu 1010" This Loan Agreement ("Agreement") is made this day of February, 2024, between BLOCK 52 HOLDINGS LLC, BUCHHOLZ EXCHANGE LLC, and NORGREN EXCHANGE LLC, each a Minnesota limited liability company (individuals, each a "Borrower Entity" and collectively, and jointly and severally, the 'Borrower"), and the City of Monticello Economic Development Authority (the "Lender"), a public body corporate and politic and political subdivision of the State of Minnesota. RECITALS A. The Lender has created the Greater Monticello Enterprise Fund (the "Program"), a revolving loan fund program to assist businesses in the City of Monticello, Minnesota (the "City") with financing certain economic development activities to meet the goals set forth in the guidelines approved by the Lender for the Program (the "Guidelines"). B. The Borrower has submitted a loan application (the "Application") and the Lender has approved a loan to the Borrower in the maximum principal amount of $300,000 (the "Loan") to pay a portion of the costs related to the improvement and the build out by the Borrower of approximately 13,303 square feet of commercial office space (the "Project") for use by Simplicity Financial Marketing Holdings Inc, a Delaware corporation (the "Tenant"), at the real property located at 101 West Broadway Street in the City (the "Property") legally described in Exhibit A attached to the Mortgage (as hereinafter defined). The Loan will be evidenced by a Promissory Note, dated as of the date hereof (the "Note"), issued by Borrower in favor of the Lender, and secured by (i) a Mortgage, dated as of the date hereof (the "Mortgage" and together with this Agreement, the Note, the "Loan Documents"), from Borrower to the Lender. C. The Loan constitutes a business subsidy within the meaning of Minnesota Statutes, Sections 116J.993 to 116J.995, as amended (the "Business Subsidy Act"), and the Lender has adopted criteria for awarding business subsidies that comply with the Business Subsidy Act after a public hearing for which notice was published in accordance with the Business Subsidy Act. D. The Lender has held a duly noticed public hearing on the business subsidy provided as represented by the Loan and this Agreement constitutes a subsidy agreement under the Business Subsidy Act. E. The Lender now makes the Loan to the Borrower subject to all of the terms and conditions of this Agreement. ACCORDINGLY, to induce the Lender to make the Loan to the Borrower and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. The Loan Amount. Subject to and upon the terms and conditions of this Agreement, the Guidelines, the Application and the other Loan Documents, the Lender agrees to loan to the Borrower the sum of Three Hundred Thousand and No/ 100 Dollars ($300,000.00), or so much thereof as is disbursed to the Borrower in accordance with this Agreement. Proceeds of the Loan (the "Proceeds") shall be disbursed in accordance with Section 3 hereof. MN325\52\928808.v2 2. Repayment of Loan. The Loan shall be evidenced by the Note payable by the Borrower to the Lender. The interest rate on the principal amount outstanding on the Note shall be fixed at 4.50% per annum. The Note shall be repaid in accordance with the Note. The Borrower may prepay the principal of the Note plus accrued interest thereon, in whole or in part, on any date as set forth in the Note. Disbursement of Loan Proceeds. (a) The Proceeds shall be disbursed in a single lump sum on a reimbursement basis. Prior to disbursement, the Borrower shall have delivered the following to the Lender: (i) Loan Documents. The Borrower having delivered to the Lender, without expense to the Lender, executed copies of the Loan Documents, together with evidence that the Mortgage has been or will be duly filed for record; (ii) Cost Certificate. A sworn certificate detailing costs and sources of funds to be utilized for the Project ("Cost Certificate") in a form acceptable to the Lender, showing an itemized breakdown of. (i) the source and amount of all Project funds; and (ii) of the total cost of the Project. At least 70% of the Project funds must come from a source other than the Loan; (iii) Evidence of Payment and Lien Waivers. Evidence in the form of paid invoices, statements, or similar and accompanying lien waivers, if applicable, that are acceptable to the Lender, that the Borrower has paid costs of the Project in an amount at least equal to the amount of the Loan; (iii) Financing. The Borrower having provided to the Lender copies of the Borrower's primary lender documents; (iv) Borrower Documents. The Borrower having provided copies of the Borrower's organizational documents, including, if applicable, articles of incorporation or articles of organization, a certificate of good standing issued by the Minnesota Secretary of State, an Employer Identification Number (EIN) certificate and evidence that the Borrower has a city, state, or federal license to do business or relevant professional license; (v) Insurance. The Borrower having delivered to the Lender a certificate or policy for all insurance required, under the terms hereof, to be maintained by the Borrower; (v) Fees. The Borrower having paid to the Lender a Loan origination fee of 1.50% of the Loan and all charges associated with the Loan, including, but not limited to: (i) Lender's attorneys' fees; and (ii) filing fees of any instruments required under this Agreement within 30 days of the Lender providing written notice to the Borrower of Lender's costs. (vi) Compliance with Laws, Etc. The Borrower shall have delivered to the Lender such evidence as the Lender may require as to the compliance of the Property with: (i) all applicable laws, codes, rules, regulations and ordinances, including, without limitation, those relative to environmental protection, protection of wetlands, building and zoning matters and the Americans with Disabilities Act; and (ii) the requirements of any restrictive covenants, conditions and restrictions; conditional use permit or planned unit development applicable to the Property; (vii) Resolutions. Each Borrower Entity shall have delivered to the Lender a copy of the resolutions of its Board of Governors, duly certified by its company secretary, authorizing the MN325\52\928808.v2 2 execution, delivery, and performance of, and the transactions contemplated by this Agreement and the Loan Documents; and (viii) Title Insurance. The Borrower, at its sole expense, will cause a title insurance company qualified to do business in the State of Minnesota and acceptable to the Lender to deliver to the Lender the title insurer's commitment to issue a title insurance policy, ALTA Loan Policy, in the amount of $300,000 effective as of the date of closing, ensuring to the Lender that: The Borrower is the owner of the Property; 2. The Property is free and clear of all other liens, charges, and encumbrances except those disclosed in the Title Commitment and Attachments; 3. A Comprehensive Endorsement, a usury endorsement, a zoning endorsement, and an access endorsement are provided; and 4. The policy will be issued free and clear of the standard printed title exceptions and exceptions to coverage as shown in the Title Commitment, including (i) encroachments, boundary line disputes, and other matters which would be disclosed by an accurate survey; (ii) any state of facts that exists after the date of the Title Commitment; (iii) easements or claims of easements not disclosed by public records; (iv) rights or claims of parties in possession not shown by the public records; (v) any lien or right to a lien for services, labor, or material furnished prior to or after this Agreement, whether shown by the public records or otherwise; (vi) taxes and special assessments not shown as existing liens by public records; and (vii) free and clear of any other objections, encumbrances, or exceptions to title. The Lender will have ten (10) business days from the receipt of the Title Commitment to notify the Borrower of any defect in title or any other title related matter deemed unacceptable to the Lender. The Borrower will have twenty (20) business days from receipt of said notice from the Lender to cure the defect(s). If the Borrower is not able to cure said defects in that period, the Lender may, in its sole discretion, cancel this Agreement, and have no further obligation to the Borrower under this Agreement. (b) Upon receipt by the Lender of the items required pursuant to this section hereof in the form and condition required therein, the Lender agrees to disburse the Proceeds to the Borrower in an amount not to exceed the lesser of (a) 30% of the total Project cost as evidenced by the Cost Certificate, or (b) the Loan amount. 4. Representations and Warranties. The Borrower Entities each warrant and represent to the Lender that: (a) The Borrower Entities are each a limited liability company under the laws of Minnesota and is duly authorized and empowered to execute, deliver, and perform this Agreement and to borrow money from the Lender. (b) The execution and delivery of this Agreement, and the performance by the Borrower of its obligations hereunder, do not and will not violate or conflict with any provision of law and do not and will not violate or conflict with, or cause any default or event of default to occur under, any agreement binding upon the Borrower. MN325\52\928808.v2 (c) The execution and delivery of this Agreement has been duly executed and delivered by the Borrower and constitutes its lawful and binding obligation, legally enforceable against it. (d) The Borrower warrants that it shall keep and maintain books, records, and other documents relating directly to the receipt and disbursements of the Proceeds and that any duly authorized representative of the Lender shall, at all reasonable times, have access to and the right to inspect, copy, audit, and examine all such books, records, and other documents of the Borrower pertaining to the Loan for 6 years after the date hereof. Upon request, the Borrower Entities shall each provide the Lender with their current balance sheets, statements of income and annual audited financial statements. (e) The Borrower warrants that it has fully complied with all applicable local, state and federal laws and ordinances pertaining to its business, the Project and the Property, and will continue to comply throughout the terms of this Agreement. If at any time the Borrower receives notice of noncompliance from any governmental entity, the Borrower agrees to notify the Lender of such noncompliance and take any necessary action to comply with the local, state or federal requirement in question. (f) The Borrower warrants that it will use the Proceeds solely for the costs of the Project. (g) The Borrower warrants that it will not create, permit to be created, or allow to exist any liens, charges, or encumbrances prior to the obligation created by this Agreement, except as otherwise authorized in writing by the Lender. Anything above to the contrary notwithstanding, Borrower at its expense may contest, by appropriate legal proceedings conducted in good faith and with due diligence, the amount or validity or application, in whole or in part, of any such lien or encumbrance provided that (a) the collection thereof from the Borrower, the Lender and the Property shall be suspended during the period of such contest, (b) neither the Property nor any part thereof or interest therein would be in any danger, deemed substantial by the Lender, of being sold, forfeited or lost, and (c) the Lender shall be furnished such security, if any, as may be required in the contest or reasonably requested by the Lender. The Borrower shall give prompt written notice to the Lender of the commencement of any contest referred to in the preceding sentence. (h) The Borrower will comply with all state and local laws pertaining to licensing, building codes, zoning, and environmental requirements. The Borrower represents that it does not have delinquent taxes, bills, fines or other charges due to the City. The Borrower represents and certifies that the Project is a conforming or legally nonconforming use under the current zoning regulations of the City. (i) The Borrower shall promptly keep, perform and comply with all of the terms, covenants and conditions to be kept and performed by the Borrower, as required by the City and any other governmental body having jurisdiction over the Property; keep unimpaired the rights of the Borrower under any permit or agreement issued or made by the City or other governmental body having jurisdiction over the Property; and to enforce the prompt performance of all of the terms, covenants and conditions to be kept and performed by the City or other governmental body having jurisdiction over the Property, respectively, under any permits or agreements issued or made by the City or such other governmental bodies, and any contractors under all contracts obtained or held by the Borrower in connection with the operation of the Borrower's business. 0) During the term of this Agreement, the Borrower shall procure and maintain or cause to be procured and maintained at its sole expense, casualty insurance, public liability insurance and such other types of insurance as are reasonably required by the Lender from time to time, with coverages and in amounts normally held by owners of property similar to the Property and with companies satisfactory to the Lender. The policy or policies or duly executed certificate or certificates for such insurance and renewals or replacements thereof shall be deposited with the Lender. NM325\52\928808.v2 4 (k) No litigation, tax claims or governmental proceedings are pending or threatened against the Borrower or the Property, and no judgment or order of any court or administrative agency is outstanding against the Borrower or the Property which would have a material adverse effect on the Borrower or the Property. (1) Unless otherwise previously disclosed to the Lender in writing, the Borrower has not entered into or granted any security agreements or permitted the filing or attachment of any mortgage on the Property that would be prior or that may in any way be superior to the Lender's Mortgage. The Lender is aware that there is a first and second lien mortgage on the Property ahead of the Lender's Mortgage. To allow the Lender protect its interests and monitor its collateral, the Borrower shall allow the Lender to inquire about the status of the primary loan(s) throughout the term of this Agreement. (m) The Borrower understands and agrees that the Lender is relying upon the above representations and warranties in extending the Loan to the Borrower. The Borrower further agrees that the foregoing representations and warranties shall be continuing in nature and shall remain in full force and effect until such time as the Loan and Note shall be paid in full, or until this Agreement shall be terminated in the manner provided above, whichever is the last to occur. (n) The Borrower shall at all times comply with the Guidelines. (o) None of the Borrower Entities shall (a) Engage in any business activities substantially different than those in which the Borrower is presently engaged; (b) cease operations, liquidate, merge or consolidate with any other entity; (c) sell, assign or transfer any of the assets of the Borrower which are related to the Borrower's business, except in the ordinary course of business; or (d) purchase or retire any of Borrower's outstanding shares or alter or amend Borrower's capital structure. Business Subsidy. (a) Public Purpose. In order to satisfy the provisions of the Business Subsidy Act, the Borrower acknowledges and agrees that the amount of the "Business Subsidy" granted to the Borrower under this Agreement is the Loan, and that the Business Subsidy is needed because the Project is not sufficiently feasible for the Borrower to undertake without the Business Subsidy due to the extraordinary costs site improvements. The public purpose of the Business Subsidy is to redevelop land in the City's downtown which is underutilized or characterized by blight, increase the tax base of the City and the State, and increase jobs in the City and State (including construction jobs). (b) Operation of Site. The Borrower shall cause the Tenant to operate the Project as an insurance office (the "Qualified Facility") for at least 5 years after the Benefit Date (defined hereinafter). The improvements will be a Qualified Facility as long as the Project is operated by the Borrower for the aforementioned qualified uses. During any period when the Project is vacant and not operated for the aforementioned qualified uses, the Project will not constitute a Qualified Facility. (c) Job and Wage Goals. The "Benefit Date" of the assistance provided in this Agreement is the earlier of the date of issuance of the Certificate of Completion or the date the Project is occupied by Tenant. By or before the "Compliance Date", defined as the date two years after the Benefit Date, the Borrower shall cause the Tenant to (i) create at least 50 full-time jobs, new to Minnesota (not relocated from another Minnesota office location), permanent to the Property, and (ii) cause the hourly wage of the new jobs to be at least $12.39 per hour, with benefits equal to at least $1.75 an hour. 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 Borrower's continuing obligations under Section 5(b). The Lender may, after a public hearing, extend the Compliance Date by up to one year, MN325\52\928808.v2 5 provided that nothing in this section will be construed to limit the Authority's legislative discretion regarding this matter. (d) Remedies. If the Borrower fails to meet the goals described in Section 5(b) and 5(c), the Borrower shall repay to the Lender upon written demand from the Lender a "pro rata share" of the outstanding principal amount of the Loan together with interest on that amount at the implicit price deflator as provided in Section 116J.994, subd. 6 of the Business Subsidy Act, accrued from the date of substantial completion of the Project to the date of payment. The term "pro rata share" means percentages calculated as follows: (i) if the failure 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 facility as a Qualified Facility in accordance with Section 5(b), 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 Lender, 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 Lender's remedies under Section 7 hereof. In addition to the remedy described in this Section and any other remedy available to the Lender for failure to meet the goals stated in Section 5, the Borrower agrees and understands that it may not receive a business subsidy from the Lender or any grantor (as defined in the Business Subsidy Act) for a period of 5 years from the date of the failure or until the Borrower satisfies its repayment obligation under this Section, whichever occurs first. (e) Reports. The Borrower must submit to the Lender a written report regarding business subsidy goals and results by no later than February 1 of each year, commencing February 1, 2025 and continuing until the later of (i) the date the goals stated in Section 5(b) and (c) are met; (ii) 30 days after expiration of the period described in Section 5(b); or (iii) if the goals are not met, the date the subsidy is repaid in accordance with Section 5(d). The report must comply with Section 116J.994, subdivision 7 of the Business Subsidy Act. The Lender will provide information to the Borrower regarding the required forms. If the Borrower fails to timely file any report required under this Section, the Lender will mail the Borrower a warning within one week after the required filing date. If, after 14 days of the postmarked date of the warning, the Borrower fails to provide a report, the Borrower must pay to the Lender a penalty of $100 for each subsequent day until the report is filed. The maximum aggregate penalty payable under this Section is $1,000. (f) Other assistance. In addition to the Loan, the Lender is providing the Land Write Down, the TIF Note and the Authority Grant and the Minnesota Department of Employment and Economic Development is providing the DEED Grant, as all such terms are defined in that certain Purchase and Development Contract, dated September 16, 2022, by and between the Lender and the Borrower. (g) Parent Corporation. None of the Borrowers have parent corporations. MN325\52\928808.v2 6 Event of Default by Borrower. The following shall be Events of Default under this Agreement: (a) failure to pay any principal or interest on the Loan when due; (b) any representation or warranty made by the Borrower herein or in any document, instrument, or certificate given in connection with the Loan Documents that is false when made; (c) Failure by the Borrower to pay its debts as they become due, or if the Borrower makes an assignment for the benefit of its creditors, admits in writing its inability to pay its debts as they become due, files a petition under any chapter of the Federal Bankruptcy Code or any similar law, state or federal, now or hereafter existing, becomes "insolvent" as that term is generally defined under the Federal Bankruptcy Code, files an answer admitting insolvency or inability to pay its debts as they become due in any involuntary bankruptcy case commenced against it, or fails to obtain a dismissal of such case within thirty (30) days after its commencement or convert the case from one chapter of the Federal Bankruptcy Code to another chapter, or be the subject of an order for relief in such bankruptcy case, or be adjudged a bankrupt or insolvent, or has a custodian, trustee, or receiver appointed for, or has any court take jurisdiction of its property, or any part thereof, in any proceeding for the purpose of reorganization, arrangement, dissolution, or liquidation, and such custodian, trustee, or receiver is not discharged, or such jurisdiction is not relinquished, vacated, or stayed within thirty (30) days of the appointment; (d) a garnishment summons or writ of attachment is issued against or served upon the Lender for the attachment of any property of the Borrower in the Lender's possession or any indebtedness owing to the Borrower, unless appropriate papers are filed by the Borrower contesting the same within thirty (30) days after the date of such service or such shorter period of time as may be reasonable in the circumstances; (e) any breach or failure of the Borrower to perform any other term or condition of this Agreement or the Loan Documents not specifically described as an Event of Default in this Agreement or the Loan Documents, and such breach or failure continues for a period of fifteen (15) days after the Lender has given written notice to the Borrower specifying such default or breach, unless the Lender agrees in writing to an extension of such time prior to its expiration; provided, however, if the failure stated in the notice cannot be corrected within the applicable period, the Lender will not unreasonably withhold its consent to an extension of such time if corrective action is instituted by the Borrower within the applicable period and is being diligently pursued until the Default is corrected, but no such extension shall be given for an Event of Default that can be cured by the payment of money (i.e., payment of taxes, insurance premiums, or other amounts required to be paid hereunder); (f) the Borrower takes any of the actions set forth in Section 9 hereof; and (g) any breach by Borrower of any other agreement between Borrower and Lender, or Borrower and the City. 7. Lender's Remedies upon Borrower's Default. Upon an Event of Default by the Borrower and after provision by the Lender of written notice, if the Borrower has failed to remedy such default within the period specified above, the Lender shall have the right to exercise any or all of the following remedies (and any other rights and remedies available to it): (a) declare the principal amount of the Loan and any accrued interest thereon to be immediately due and payable upon providing written notice to the Borrower; (b) suspend its performance under this Agreement; MN325\52\928808.v2 7 (c) take any action provided for at law to enforce compliance by the Borrower with the terms of this Agreement and the Note; (d) foreclose on the Mortgage; (e) exercise its remedies under the Mortgage. In addition to any other amounts due on the Loan, and without waiving any other right of the Lender under any this Agreement or any other instrument securing the Loan applicable documents, the Borrower shall pay to the Lender a late fee of $250 for any payment not received in full by the Lender within 30 calendar days of the date on which it is due. Furthermore, interest will continue to accrue on any amount due until the date on which it is paid to the Lender, and all such interest will be due and payable at the same time as the amount on which it has accrued. 8. Lender's Costs of Enforcement of Agreement. If an Event of Default has occurred as provided herein, then upon demand by the Lender, the Borrower shall pay or reimburse the Lender for all expenses, including all attorneys' fees and expenses incurred by the Lender in connection with the enforcement of this Agreement and the Note, or in connection with the protection or enforcement of the interests and collateral security of the Lender in any litigation or bankruptcy or insolvency proceeding or in any action or proceeding relating in any way to the transactions contemplated by this Agreement. Early Repayment. The Loan will be immediately due and payable if- (a) £ (a) the Borrower or its owners sells or otherwise transfers any or part or his/her interest in the Property; (b) the Borrower fails to comply with the Guidelines; or (c) the Tenant ceases operations, reduces services or significantly alters the Project within five years of the date hereof. 10. Indemnification. (a) The Borrower shall and does hereby agree, jointly and severally, to protect, defend, indemnify, and hold the Lender and the City, and their respective officers, agents, and employees, harmless of and from any and all liability, loss, or damage that it may incur under or by reason of this Agreement, and of and from any and all claims and demands whatsoever that may be asserted against the Lender by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained herein. (b) Should the Lender or the City, or their respective officers, agents, or employees, incur any such liability or be required to defend against any claims or demands pursuant to Section 10, or should a judgment be entered against the Lender, the amount thereof, including costs, expenses, and reasonable attorneys' fees, shall bear interest thereon at the rate then in effect on the Note, shall be secured hereby, shall be added to the Loan, and the Borrower, jointly and severally, shall reimburse the Lender for the same immediately upon demand, and upon the failure of the Borrower to do so, the Lender may declare the Loan immediately due and payable. (c) This indemnification and hold harmless provision shall survive the execution, delivery, and performance of this Agreement and the creation and payment of any indebtedness to the Lender. The MN325\52\928808.v2 8 Borrower waives notice of the acceptance of this Agreement by the Lender. (d) Nothing in this Agreement shall constitute a waiver of or limitation on any immunity from or limitation on liability to which the Lender is entitled under law. 11. Joint and Several Obligations. . All obligations of the Borrower Entities under this Loan Agreement shall be and are joint and several obligations. 12. Miscellaneous. (a) Waiver. The performance or observance of any promise or condition set forth in this Agreement may be waived, amended, or modified only by a writing signed by the Borrower and the Lender. No delay in the exercise of any power, right, or remedy operates as a waiver thereof, nor shall any single or partial exercise of any other power, right, or remedy. (b) Assi nin . This Agreement shall be binding upon the Borrower and its successors and assigns and shall inure to the benefit of the Lender and its successors and assigns. All rights and powers specifically conferred upon the Lender may be transferred or delegated by the Lender to any of its successors and assigns. The Borrower's rights and obligations under this Agreement may be assigned only when such assignment is approved in writing by the Lender. (c) Governing Law. This Agreement is made and shall be governed in all respects by 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. (d) Severability. If any provision or application of this Agreement is held unlawful or unenforceable in any respect, such illegality or unenforceability shall not affect other provisions or applications that can be given effect, and this Agreement shall be construed as if the unlawful or unenforceable provision or application had never been contained herein or prescribed hereby. (e) Notice. All notices required hereunder shall be given by depositing in the U.S. mail, postage prepaid, first-class mail, return receipt requested, to the following addresses (or such other addresses as either party may notify the other): To Lender: City of Monticello Economic Development Authority 505 Walnut Street, Suite 1 Monticello, MN 55362 Attn: Executive Director To Borrower: Block 52 Holding LLC 4510 3rd Street S. Moorhead, MN 56560 Buchholz Exchange LLC 4379 331 Avenue S. #121 Fargo, ND 58104 Norgren Exchange LLC 4379 33' Avenue S. #121 Fargo, ND 58104 MN325\52\928808.v2 9 To Tenant: Simplicity Financial Marketing Holdings Inc 222 South 9"' Street, Suite 450 Minneapolis, MN 55402 (f) Termination. If the Loan is not disbursed pursuant to this Agreement within 180 days of approval of the Loan by the Board of the Commissioners of the Lender (the "Board"), this Agreement shall terminate and neither party shall have any further obligation to the other, except that if the Loan is not disbursed because the Borrower has failed to use its best efforts to comply with the conditions set forth in Section 3 of this Agreement then the Borrower shall pay to the Lender all reasonable attorneys' fees, costs, and expenses incurred by the Lender in connection with this Agreement and the Note. The 180 days may be extended up to an additional 120 days if an extension request is (i) received at least 30 days prior to the expiration of the 180 days and (ii) approved by the Board. Provided the Loan is disbursed within the required timeframe, this Agreement shall terminate on the later of the Maturity Date (as defined in the Note) or the date that the Loan has been paid in full (the "Termination Date"). Notwithstanding anything herein to the contrary, the indemnification provisions provided in Section 10 hereof shall not terminate on the Termination Date. (g) Entire Agreement. This Agreement, together with any exhibits attached hereto, which are incorporated by reference, constitutes the complete and exclusive statement of all mutual understandings between the parties with respect to this Agreement, superseding all prior or contemporaneous proposals, communications, and understandings, whether oral or written, concerning the Loan. (h) Headings. The headings appearing at the beginning of the several sections contained in this Agreement have been inserted for identification and reference purposes only and shall not be used in the construction and interpretation of this Agreement. (i) Recording of Documents. The Mortgage shall be recorded with the county on which the Property is located and all costs of such recording shall be paid by the Borrower. 0) Electronic Signatures; Execution in Counterparts. The electronic signature of the parties to this Agreement shall be as valid as an original signature of such party and shall be effective to bind the parties hereto. For purposes hereof, (i) "electronic signature" means a manually signed original signature that is then transmitted by electronic means; and (ii) "transmitted by electronic means" means sent in the form of a facsimile or sent via the internet as a portable document format ("pdf') or other replicating image attached to an electronic mail or internet message. 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. (k) Data Practices. All data collected, created, received, maintained or disseminated for any purpose in the course of the Borrower's performance of this Agreement is governed by the Minnesota Government Data Practices Act, Minn. Stat. Ch. 13, and any other applicable state statutes, any state rules adopted to implement the Act and statutes, as well as federal statutes and regulations on data privacy. (1) Accounting and Records. The Borrower agrees to establish and maintain complete, accurate and detailed accounts and records relating to the receipt and expenditure of all funds received under this Agreement. Such accounts and records shall be kept and maintained by the Borrower for a period of six (6) years following the Termination Date. Accounting methods shall be in accordance with generally accepted accounting principles. MN325\52\928808.v2 10 (m) Audits. The accounts and records of the Borrower described in paragraph (1) above shall be audited in the same manner as all other accounts and records of the Borrower and may, for a period of six (6) years following the Termination Date, be inspected on the Borrower's premises by the Authority or individuals or organizations designated by the Authority, upon reasonable notice thereof to the Borrower. The books, records, documents and accounting procedures relevant to this Agreement are subject to examination by the State Auditor in accordance with Minnesota law. MN325\52\928808.v2 11 IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the proper officers thereunto duly authorized on the day and year first written above. LENDER: CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY By: President By: Executive Director [SIGNATURE PAGE TO LOAN AGREEMENT — CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY] MN325\52\928808.v2 BLOCK 52 HOLDINGS LLC, a Minnesota limited liability company Its BUCHHOLZ EXCHANGE LLC, a Minnesota limited liability company Dale Buchholz Its NORGREN EXCHANGE LLC, a Minnesota limited liability company an Steve Norgren Its NM325\52\928808.v2 S-1 The Loan Agreement, including the business subsidy agreement contain in section 5 hereof, is acknowledged and consented to by the Tenant. TENANT: SIMPLICITY FINANCIAL MARKETING HOLDINGS INC. Its NM325\52\928808.v2 S-2 EXHIBIT A LEGAL DESCRIPTION That property located in the City of Monticello, Wright County, Minnesota and legally described as follows: Lot 2, Block 1, Block 52 First Addition. NM325\52\928808.v2 A-1 PROMISSORY NOTE $300,000 February __, 2024 FOR VALUE RECEIVED, the undersigned, BLOCK 52 HOLDING LLC, BUCHHOLZ EXCHANGE LLC, and NORGREN EXCHANGE LLC, each a Minnesota limited liability company (each a "Borrower Entity" and, collectively, the "Borrower"), for value received, hereby promises to pay to the CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY, a public body corporate and politic under the laws of Minnesota (the "Lender") (Lender and any holder of this Note from time to time are each hereinafter sometimes referred to as "Holder"), 505 Walnut Street, Suite 1, Monticello, Minnesota 55362, or such other place as may be designated from time to time in writing by the Holder hereof, the principal sum of THREE HUNDRED THOUSAND and no/100ths Dollars ($300,000) or so much thereof as may be advanced under this Note (the "Loan"), pursuant to the terms of a Loan Agreement between the Borrower and the Lender of even date herewith (the "Loan Agreement"), together with interest thereon at the rate of 3.50% per annum from the date of this Promissory Note (the "Note"), in any coin or currency which at the time or times of payment is legal tender for the payment of private debts in the United States of America. All capitalized terms not otherwise defined herein shall have the meanings set forth in the Loan Agreement. The principal and interest of this Note is payable as follows: 1. Interest at the rate of 3.50% per annum shall accrue on the principal amount outstanding on the Note. The Borrower shall make level payments of principal and interest beginning on November 1, 2024 (the "Initial Payment Date"), and continue on the first day of each and every month thereafter until paid in full. Such payments shall fully amortize the principal and interest over twenty-five (25) years; provided that the final payment of unpaid principal and interest shall be due and payable on October 1, 2034 (the "Maturity Date"). 2. The Borrower may prepay the principal of the Note plus accrued interest thereon, in whole or in part, on any date without premium or penalty. 3. In addition to any other amounts due on the Loan Amount, and without waiving any other right of Lender under the Loan Documents, Borrower shall pay to Lender a late fee of $250.00 for any payment not received in full by Lender within 16 calendar days of the date on which it is due. Furthermore, interest will continue to accrue on any amount due until the date on which it is paid to Lender, and all such interest will be due and payable at the same time as the amount on which it has accrued. 4. This Note evidences the Loan and is given pursuant to the Loan Agreement. The repayment of this Notie is secured by the Mortgage. All of the agreements, conditions, covenants, provisions, and stipulations contained in the Loan Agreement, the Mortgage, or any other instrument securing this Note are hereby made a part of this Note to the same extent and with the same force and effect as if they were fully set forth herein. It is agreed that time is of the essence of this Note. If an Event of Default occurs hereunder, under the Loan Agreement or any other instrument securing this Note, then Lender may at its right and option, pursuant to a notice of default, declare immediately due and payable the principal balance of this Note and interest accrued thereon, together with any costs of collection including attorney fees incurred by Lender in collecting or enforcing payment hereof, whether suit be brought or not, and all other sums due hereunder or under the Loan Agreement. 5. The remedies of the Lender as provided herein, and in the Loan Agreement, the Mortgage, or any other instrument securing this Note shall be cumulative and concurrent and may be pursued singly, successively, or together, and, at the sole discretion of the Lender, may be exercised as often as occasion therefor shall occur; and the failure to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. The Lender shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by the Lender and then only to the extent specifically set forth in the writing. A waiver with reference to one event shall not be construed as continuing or as a bar to or waiver of any right or remedy as to a subsequent event. This Note may not be amended, modified, or changed except only by an instrument in writing signed by the party against whom enforcement of any such amendment, modifications, or change is sought. 6. The obligations of the Borrower hereunder are unconditional irrespective of any defense or any rights of setoff, recoupment or counterclaim it might otherwise have against the Lender, the City, or any government body or other person. 7. If any of the terms of this Note, or the application thereof to any person or circumstances shall, to any extent, be invalid or unenforceable, the remainder of this Note, or the application of such terms to persons or circumstances other than those to which it is invalid or unenforceable, shall not be affected thereby, and each of the terms of this Note shall be valid and enforceable to the fullest extent permitted by law. 8. It is intended that this Note is made with reference to and shall be construed as a Minnesota contract and governed by the laws of the State of Minnesota. 9. Each Borrower Entity shall be jointly and severally liable under this Note, and the term "Borrower", wherever used in this Note, shall mean the Borrower or any one or more of them. 10. IT IS HEREBY CERTIFIED AND RECITED that all conditions, acts, and things required to exist, happen, and be performed precedent to or in the issuance of this Note do exist, have happened, and have been performed in regular and due form as required by law. [The remainder of this page is intentionally blank.] MN325\52\929078.v2 2 IN WITNESS WHEREOF, the Borrower has caused this Note to be duly executed as of the day of , 2024. BLOCK 52 HOLDINGS LLC, a Minnesota limited liability company Its BUCHHOLZ EXCHANGE LLC, a Minnesota limited liability company Dale Buchholz Its NORGREN EXCHANGE LLC, a Minnesota limited liability company Steve Norgren Its [SIGNATURE PAGE FOR PROMISSORY NOTE] S-1 MN325\52\929078.v2 MORTGAGE THE MAXIMUM PRINCIPAL INDEBTEDNESS SECURED BY THIS MORTGAGE IS $300,000. THIS MORTGAGE (the "Mortgage") made as of the _ day of , 2024 by BLOCK 52 HOLDINGS LLC, BUCHHOLZ EXCHANGE LLC, and NORGREN EXCHANGE LLC, each a Minnesota limited liability company (each, a `Borrower Entity" and, collectively, the `Borrower" or the "Borrower Entities"), in favor of the CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY, a public body corporate and politic and a political subdivision of the State of Minnesota (the "Lender"). WITNESSETH: All of the Borrower Entities, jointly and severally, owe the Lender the principal sum of THREE HUNDRED THOUSAND DOLLARS AND NO/100 ($300,000), which debt is evidenced by a Promissory Note of even date herewith (the "Note"), with a maturity date of September 1, 2034, the terms and conditions of which are incorporated herein. This Mortgage secures to the Lender: (a) the repayment of the debt evidenced by the Note, and all renewals, extensions, and modifications of the Note; (b) the payment of all other sums, with interest thereon, advanced to protect the security of this Mortgage; (c) the performance of the Borrower Entities' covenants and agreements under this Mortgage and the Note; and (d) is subject to the terms and conditions of that certain Loan Agreement of even date herewith (the "Loan Agreement"), between the Borrower and the Lender. For this purpose, the Borrower does hereby mortgage, grant and convey to Lender, with power of sale, the real property located in Wright County, Minnesota and legally described in the Exhibit A attached hereto, together with all the improvements now or hereafter erected on the property, and all easements, appurtenances, and fixtures now or hereafter a part of the property. All replacements and additions shall also be covered by this Mortgage. All of the foregoing is referred to in this Mortgage as the "Property". THE BORROWER COVENANTS that the Borrower is lawfully seized of the estate hereby conveyed and has the right to mortgage, grant, and convey the Property and that the Property is unencumbered, except for those encumbrances of record previously disclosed in writing to the Lender, including those in Section 2 hereof. The Borrower warrants and will defend generally the title to the Property against all claims and demands, subject to any encumbrances of record. The Borrower and the Lender agree as follows: 1. PAYMENT OF PRINCIPAL AND INTEREST; LATE CHARGES. The Borrower Entities shall promptly pay when due the principal of and accrued interest on the debt evidenced by the Note and any late charges due under the Note or the Loan Agreement. 2. SUBORDINATION. This Mortgage is subordinate to (a) the Mortgage given by the Borrower to [ �, dated [ I and recorded with the [County Recorder] as document number [] on [ ]; and (b) the Mortgage given by the Borrower to [ ], dated [ ] and recorded with the [County Recorder] as document number on [ ]. 3. CHARGES; LIENS. The Borrower Entities shall pay all taxes, assessments, charges, fines, and impositions attributable to the Property which may attain priority over this Mortgage, and leasehold payments or ground rents, if any. The Borrower Entities shall pay these obligations on time directly to the person owed payment. The Borrower Entities shall promptly discharge any lien which has priority over this Mortgage, notwithstanding those named in Section 2 hereof, unless the Borrower Entities: (a) agree in writing to the payment of the obligation secured by the lien in a manner reasonably acceptable to the Lender; (b) contest in good faith the lien by, or defends against enforcement of the lien in, legal proceedings which in the Lender's opinion operate to prevent the enforcement of the lien; or (c) secure from the holder of the lien an agreement satisfactory to the Lender subordinating the lien to this Mortgage. If the Lender determines that any part of the Property is subject to a lien which may attain priority over this Mortgage, other than those named in Section 2 hereof, the Lender may give the Borrower Entities a notice identifying the lien. The Borrower Entities shall satisfy the lien or take one or more of the actions set forth above within 30 days of the giving of notice. 4. HAZARD OR PROPERTY INSURANCE. The Borrower Entities shall keep the improvements now existing or hereafter erected on the Property insured against loss by fire and any other hazards for which the Lender requires insurance for full replacement value of the improvements. This insurance shall be maintained in the amounts and for the periods that the Lender reasonably requires. The insurance carrier providing the insurance shall be chosen by the Borrower Entities. If the Borrower Entities fail to maintain coverage described above, the Lender may, at the Lender's option, obtain coverage to protect the Lender's rights in the Property in accordance with paragraph 5. All insurance policies and renewals shall be reasonably acceptable to the Lender and shall include a standard mortgage clause. If the Lender requires, the Borrower Entities shall promptly give to the Lender all receipts of paid premiums and renewal notices. In the event of loss, the Borrower Entities shall give prompt notice to the insurance carrier and the Lender. The Lender may make proof of loss if not made promptly by the Borrower Entities. If under Section 16 the Property is acquired by the Lender, the Borrower's right to any insurance policies and proceeds resulting from damage to the Property prior to the acquisition shall pass to the Lender to the extent of the sums secured by this Mortgage immediately prior to the acquisition. 5. PROTECTION OF THE PROPERTY. The Borrower Entities shall keep the property in good repair and shall not destroy or damage the Property or commit waste on or permit impairment or deterioration of the Property. The Borrower Entities shall be in default if any forfeiture action or proceeding, whether civil or criminal, is begun that in the Lender's good faith judgment could result in forfeiture of the Property or otherwise materially impair the lien created by this Mortgage or the Lender's security interest. The Borrower Entities may cure such a default and reinstate, as provided in Section 14, by causing the action or proceeding to be dismissed with a ruling that, in the Lender's good faith 2 MN325\52\929115.v2 determination, precludes forfeiture of the Borrower Entities' interest in the Property or other material impairment of the lien created by this Mortgage or the Lender's security interest. The Borrower Entities shall also be in default if any of the Borrower Entities gave materially false or inaccurate information or statements to the Lender in connection with the loan evidenced by the Note. 6. PROTECTION OF LENDER'S RIGHTS IN THE PROPERTY. If any of the Borrower Entities fail to perform the covenants and agreements contained in this Mortgage, or there is a legal proceeding that may significantly affect the Lender's rights in the Property (such as a proceeding in bankruptcy, condemnation, or forfeiture), the Lender may do and pay for whatever is necessary to protect the value of the Property and the Lender's rights in the Property. The Lender's actions may include paying any sums secured by a lien which has priority over this Mortgage, appearing in court, paying reasonable attorneys' fees, and entering on the Property to make repairs. Although the Lender may act under this Section 6, the Lender is not required to do so. Any amounts disbursed by the Lender under this paragraph 5 shall become additional joint and several debt of the Borrower Entities secured by this Mortgage. Unless the Borrower Entities and the Lender agree to other terms of payment, these amounts shall bear interest from the date of disbursement at a rate equal to the interest rate on the Note and shall be payable, with interest, upon notice from the Lender to the Borrower Entities requesting payment. 7. INSPECTION. The Lender or its agent may make reasonable entries upon and inspections of the Property upon reasonable notice to the Borrower Entities. 8. CONDEMNATION. The proceeds of any award or claim for damages, direct or consequential, in connection with any condemnation or other taking of any part of the Property, or for conveyance in lieu of condemnation, are hereby assigned and shall be paid to the Lender. In the event of a total taking of the Property, the proceeds shall be applied to the sums secured by this Mortgage, whether or not then due, with any excess paid to the Borrower Entities. In the event of a partial taking of the Property in which the fair market value of the Property immediately before the taking is equal to or greater than the amount of the sums secured by this Mortgage immediately before the taking, unless Borrower Entities and Lender otherwise agree in writing, if any, the sums secured by this Mortgage shall be reduced by the amount of the proceeds multiplied by the following fraction: (a) the total amount of the sums secured immediately before the taking, divided by (b) the fair market value of the Property immediately before the taking. Any balance shall be paid to the Borrower Entities. In the event of a partial taking of the Property in which the fair market value of the Property immediately before the taking is less than the amount of the sums secured immediately before the taking, unless the Borrower Entities and the Lender otherwise agree in writing or unless applicable law otherwise provides, the proceeds shall be applied to the sums secured by this Mortgage whether or not the sums are then due. 9. FORBEARANCE BY LENDER NOT A WAIVER. Any forbearance by the Lender in exercising any right or remedy shall not be a waiver of or preclude the exercise of any right or remedy. 10. SUCCESSORS AND ASSIGNS BOUND. The covenants and agreements of this Mortgage shall bind and benefit the successors and assigns of the Lender and the Borrower Entities. 11. LOAN CHARGES. If the loan secured by this Mortgage is or becomes subject to a law which sets maximum loan charges, and that law is finally interpreted so that the interest or other loan charges collected or to be collected in connection with the loan exceed the permitted limits, then: (a) any such loan charge shall be reduced by the amount necessary to reduce the charge to the permitted limit; and (b) any sums already collected from the Borrower Entities which exceeded permitted limits will be refunded 3 MN325\52\929115.v2 to the Borrower Entities. The Lender may choose to make this refund by reducing the principal owed under the Note or by making a direct payment to the Borrower Entities. If a refund reduces principal, the reduction will be treated as a partial prepayment under the Note. 12. NOTICES. Any notice to the Borrower Entities provided for in this Mortgage shall be given by delivering it personally or by mailing it by first class United States mail, postage prepaid, return receipt requested. The notice shall be directed to the Borrower Entities at (i) 4510 Yd Street S., Moorhead, Minnesota 56560 and (ii) 4379 33' Avenue S. #121, Fargo, North Dakota 58104, or any other address(es) the Borrower Entities designates by notice to the Lender. Any notice to the Lender shall be given or mailed to 505 Walnut Street, Suite 1, Monticello, Minnesota 55362, or any other address the Lender designates by notice to the Borrower Entities. Any notice provided for in this Mortgage shall be deemed to have been given to the Borrower Entities or the Lender when given as provided in this paragraph. 13. GOVERNING LAW; SEVERABILITY. This Mortgage shall be governed by the law of the state of Minnesota. In the event that any provision or clause of this Mortgage or the Note conflicts with applicable law, such conflict shall not affect other provisions of this Mortgage or the Note which can be given effect without the conflicting provision. To this end, the provisions of this Mortgage and the Note are declared to be severable. 14. BORROWER'S RIGHT TO REINSTATE. If the Borrower meets certain conditions, the Borrower shall have the right to have enforcement of this Mortgage discontinued at any time prior to the earlier of. (a) 5 days before sale of the Property pursuant to any power of sale contained in this Mortgage; or (b) entry of a judgment enforcing this Mortgage. Those conditions are that the Borrower: (a) pays Lender all sums which then would be due under this Mortgage and the Note as if no acceleration had occurred; (b) cures any default of any other covenants or agreements; (c) pays all expenses incurred in enforcing this Mortgage, including, but not limited to, reasonable attorneys' fees; and (d) takes such action as the Lender may reasonably require to assure that the lien of this Mortgage, Lender's rights in the Property and the Borrower Entities' obligation to pay the sums secured by this Mortgage shall continue unchanged. Upon reinstatement by the Borrower Entities, this Mortgage and the obligations secured hereby shall remain fully effective as if no acceleration had occurred. 15. HAZARDOUS SUBSTANCES. The Borrower Entities shall not cause or permit the presence, use, disposal, storage, or release of any hazardous substances on or in the Property, except those solvents, oils, cleaning materials, and other substances as are used in the ordinary course of the Borrower Entities' business. The Borrower Entities shall not do, and will use their best efforts not to allow anyone else to do, anything affecting the Property that is in violation of any environmental law. The Borrower Entities shall promptly give Lender written notice of any investigation, claim, demand, lawsuit, or other action by any governmental or regulatory agency or private party involving the Property and any hazardous substance or environmental law of which the any of the Borrower Entities have actual knowledge. If any of the Borrower Entities learn, or are notified by any governmental or regulatory authority, that any removal or other remediation of any hazardous substance affecting the Property is necessary, the Borrower Entities shall promptly take all necessary remedial actions in accordance with that environmental law. As used in this Section 15, "hazardous substances" are those substances defined as toxic or hazardous substances by environmental law and the following substances: gasoline, kerosene, other flammable or toxic petroleum products, volatile solvents, materials containing asbestos or formaldehyde, and radioactive materials. As used in this Section 15, "environmental law" means federal or state laws that relate to environmental protection. 4 MN325\52\929115.v2 16. ACCELERATION; REMEDIES. The Lender shall give notice to the Borrower Entities prior to acceleration following any of the Borrower Entities' breach of any covenant or agreement in this Mortgage. The notice shall specify: (a) the default; (b) the action required to cure the default; (c) a date, not less than 30 days from the date the notice is given to Borrower Entities by which the default must be cured, provided, however, if the Borrower Entities are diligently pursuing a cure, the Borrower Entities shall have such additional time as is reasonably necessary to complete the cure; and (d) that failure to cure the default on or before the date specified in the notice may result in acceleration of the sums secured by this Mortgage and sale of the Property. The notice shall further inform the Borrower Entities of the right to reinstate after acceleration and sale. If the default is not cured on or before the date specified in the notice, the Lender at its option may require immediate payment in full of any sums secured by this Mortgage without further demand and may invoke the power of sale and any other remedies permitted by law. The Lender shall be entitled to collect all expenses incurred in pursuing the remedies provided in this Section 16, including, but not limited to, reasonable attorneys' fees. If Lender invokes the power of sale, the Lender shall cause a copy of a notice of sale to be served upon any person in possession of the Property. The Lender shall publish a notice of sale, and the Property shall be sold at public auction in the manner prescribed by law. The Lender or its designee may purchase the Property at any sale. The proceeds of the sale shall be applied in the following order: (a) to all expenses of the sale, including, but not limited to, reasonable attorneys' fees; (b) to all sums secured by this Mortgage; and (c) any excess to the person or persons legally entitled to it. 17. RELEASE OF MORTGAGE. Upon payment of all sums secured by this Mortgage, Lender shall discharge this Mortgage without charge to the Borrower Entities. The Borrower Entities shall pay any recordation costs. 18. TRANSFER OF THE PROPERTY OR A BENEFICIAL INTEREST IN BORROWER ENTITIES. If any of the Borrower Entities sell or convey all or any part of the Property or any interest in the Property (or if a beneficial interest in any the Borrower Entities is sold or transferred and the Borrower Entity is not a national person) without the Lender's prior written consent, the Lender may, at its option, require immediate payment in full of all sums secured by this Mortgage; provided, however, that if the Lender requires the immediate payment in full of all sums secured by this Mortgage, then the Borrower Entities may, in their sole discretion, elect to convey title to the Property to the Lender and, in that event, the Lender shall forgive the unpaid balance of all sums secured by this Mortgage and release the Borrower Entities from this Mortgage, the Note, and the Loan Agreement, without further liability. However, the Lender shall not exercise its option if such exercise is prohibited by federal or state law as of the date of this Mortgage. If the Lender exercises such option, the Lender shall give the Borrower Entities notice of acceleration. The notice shall provide a period of not less than 30 days from the date the notice is delivered or mailed within which the Borrower Entities must pay all sums secured by this Mortgage or elect to convey title to the Property to the Lender in lieu of such accelerated payment. If any of the Borrower Entities fail to pay these sums or to elect to convey title to the Lender prior to the expiration of this period, the Lender may invoke any remedies permitted by this Mortgage without further notice or demand on the Borrower Entities. 19. ADDITIONAL COVENANTS. The Borrower Entities covenant: (a) to warrant title to the Property, (b) to pay all other mortgages, liens, charges or encumbrances against the Property as and when they become due, (c) to pay the indebtedness of the Note as herein provided, (d) to pay all real estate taxes on the Property (e) that the Property shall be kept in repair and no waste shall be committed as provided in Paragraph 5, (f) that the Borrower Entities shall keep any buildings on the Property insured against loss by fire and other hazards for at least the sum of the full insurable value of the Property for the protection of the Lender as provided in Paragraph 4; and (g) that the whole of the principal sum shall become due after default in the payment of any installment of principal or interest, or of any tax, or in the performance of any other covenant, 5 MN325\52\929115.v2 at the option of the Lender; provided, however, that if the Lender declares such a default and requires payment in full of all sums secured by this Mortgage, then Borrower Entities may, in their sole discretion, elect to convey title to the Property to the Lender and, in that event, the Lender shall forgive the unpaid balance of all sums secured by this Mortgage and release the Borrower Entities from their obligations under this Mortgage, the Note, and the Loan Agreement, without further liability. 20. JOINT AND SEVERAL LIABILITY. Each Borrower Entity under this Mortgage shall be considered a Mortgagor within the meaning of this Mortgage, and each shall be jointly and severally responsible for payment under this Mortgage and the Note. (The remainder of this page is intentionally blank.) 6 MN325\52\929115.v2 IN TESTIMONY WHEREOF, Borrower has hereunto set its hand the day and year first above written. BLOCK 52 HOLDINGS LLC, a Minnesota limited liability company Its STATE OF MINNESOTA COUNTY OF On this day of , 2024, before me the undersigned, a Notary Public in and for said state, personally appeared , personally known to me, or proved to me on the basis of satisfactory evidence, to be , the of Block 52 Holdings LLC, a Minnesota limited liability company, and executed the within instrument on behalf of such corporation. Notary Public S-1 MN325\52\929115.v2 BUCHHOLZ EXCHANGE LLC, a Minnesota limited liability company Dale Buchholz Its STATE OF MINNESOTA COUNTY OF On this day of , 2024, before me the undersigned, a Notary Public in and for said state, personally appeared , personally known to me, or proved to me on the basis of satisfactory evidence, to be Dale Buchholz, the of Buchholz Exchange LLC, a Minnesota limited liability company, and executed the within instrument on behalf of such corporation. Notary Public S-2 MN325\52\929115.v2 NORGREN EXCHANGE LLC, a Minnesota limited liability company Steve Norgren Its STATE OF MINNESOTA COUNTY OF On this day of , 2024, before me the undersigned, a Notary Public in and for said state, personally appeared , personally known to me, or proved to me on the basis of satisfactory evidence, to be Steve Norgren, the of Norgren Exchange LLC, a Minnesota limited liability company, and executed the within instrument on behalf of such corporation. Notary Public This document drafted by: KENNEDY & GRAVEN, CHARTERED (GAF) 100 S 5th St., Suite 700 Minneapolis, Minnesota 55402 (612)337-9300 S-3 MN325\52\929115.v2 EXHIBIT A Legal Description of Property That property located in the City of Monticello, Wright County, Minnesota and legally described as follows: Lot 2, Block 1, Block 52 First Addition. A-1 MN325\52\929115.v2 Requested Information below - 1. A map showing the exact boundaries of proposed development. See attached boundary map, plat map of Block 52, and floorplan for the proposed Simplicity Insurance Office 2. Give a general description of the project size and location of building(s); business type or use; traffic information including parking, projected vehicle counts and traffic flow; timing of the project; estimated market value following completion. The proposed business type is Insurance related business, the projected vehicle counts is estimated to be between 80-100 vehicles. The project is estimated to begin _January 2024 and be completed by_July, 2024 . The overall cost of the office construction is estimated to be two million dollars . The existing Comprehensive Guide Plan Land Use designation and zoning of the property. Include a statement as to how the proposed development will conform to the land use designation and how the property will be zoned. The proposed project is located within the Broadway and Riverfront Sub -Districts in the Central Community District (CCD). More specifically, the project will occur within the Block 52 PUD District which has previously been approved by the City of Monticello for a "Mixed -Use" Building consisting of 87 Residential Apartment Units and approximately 30,000 Sq Ft of Commercial Office and Retail Use. The subject property will be utilized as Insurance based general office use and as such, conforms to the CCD land use designation. The space will account for 13,303 square feet of commercial space or approximately 45 % of the overall commercial space. 4. A statement identifying how the increment assistance will be used and why it is necessary to undertake the project. The Increment assistance will be used as a critical source of "gap funding" for the project. In the early stages of negotiating with Simplicity Insurance they were admittedly evaluating several locations both inside and outside the Monticello market. In addition to evaluating locations based on a variety of criteria. However, an emphasis was placed on being able to work with a Developer capable of delivering a "turnkey" Class A office space, while limiting their out-of-pocket expenses in exchange for a long-term commitment. As the Developer we have committed $1,166,400.00 dollars towards the construction of Simplicity's new office space (For reference we have included a copy of the proposed floor plan, which will occupy the entire "Broadway Wing" of the Block 52 Building). Our intentions are to utilize the low interest increment financing from the EDA as "gap funding" along with a combination of cash and conventional financing to fund the completion of this project. For further perspective, the total amount of tenant improvements being requested by Simplicity equates to the equivalent of just under 4 of the 10 years of base rent being paid by Simplicity. Even with the proposed funding request from the EDA this creates a substantial financial challenge, however as we have stated from the outset, we have always viewed the Block 52 project as a long-term investment and securing a quality business such as Simplicity will provide a firm foundation to the commercial portion of the development. The addition of Simplicity will serve as incubator for future commercial uses and the 80-100 employees will inevitable be customers of other future retailers/businesses/restaurant that locate within Block 52 as well as for other businesses that are located within the downtown Monticello corridor. It has always been our belief that the ongoing success of Block 52 will be contingent upon our ability to attract both office and retail as both uses provide substantial synergy to between them. The addition of a high-quality business such as Simplicity Insurance to the Block 52 development will undoubtedly contribute to the overall vibrancy and sustainability that the City of Monticello has been seeking for the downtown corridor. 5. A statement identifying the public benefits of the proposal including estimated increase in property valuation, new jobs to created, hourly wages and other community assets. As mentioned above creating/maintaining an additional 80-100 jobs that will pay in the range of _$40,000-$100,000 will be a boost to the downtown business corridor and the addition of these employees will undoubtedly be serve as customers of the existing and future businesses and retailers located within the downtown corridor. Once open Simplicity Insurance will be one of the largest employers within the Monticello downtown business district. 6. A written description of the developer's business, principals, history, and past projects Buchholz Properties has been active in the Monticello Market since acquiring the 20 -acre development in 2019 from Premier Bank known as Deephaven, which is a part of the greater Pointes at Cedar master development. Other notable projects within the Deephaven Development are the 165 -market rate multifamily residential units, Healing Moments Counseling Center, and most recently the West Metro Medical Office Building. Other projects within the Monticello market include the Block 52 Mixed Use Development and the 6" Street Station. Outside of the Monticello market Buchholz has been involved in the development and acquisition of a variety of real estate projects throughout the tri-state area (Minnesota, North Dakota, South Dakota). Buchholz prides itself on principles of hard work, honesty, and a willingness to seek out and incorporate input from communities that they develop within. I understand the application fee will be used for EDA staff and consultant costs and may be partially refundable if the request for assistance is withdrawn. Refunds will be made at the discretion of the EDA Board and be based on the costs incurred by the EDA prior to withdraw of the requests for assistance. If the initial application fee is insufficient, I will be responsible for additional deposits. I further understand that by signing below, should the original escrow be exceeded, the applicant or responsible party will be billed for additional services. In signing the acknowledgement below, the applicant is indication that the have not relied on the estimate of fees in their decision to proceed with the application. If payment is not received as required by this agreement, the City will process to recover payment by action of assessment or a lien against the property. Payment of the cost sill be required whether the application is granted or denied. SIGNATURE Applicants signature: Date: January 3, 2024 Prolect Information: 1. Have you ever filed for bankruptcy? NO Have you ever defaulted on any loan commitment? NO 3. Have you ever applied for conventional financing for the project? There is currently a first mortgage on the overall Block 52 project in the amount of $17,100,000.00. We are in the process of increasing this amount by approximately $ 2,000,000.00 due to project delays and increased input costs. The increased mortgage is being sought in order to complete the remainder of the construction on the overall building and is unrelated to construction involving Simplicity Insurance 4. List Financial References: a. Marc Knutson (Western State Bank) mobile (7011-306-1490 email Marc.Knutson@bankforward.com b. Jordan Cook (Boarder Bank) mobile (701)-526-1130 email Jordan.cook@boarder.bank C. Adam Braunberger (American Federal Bank) mobile (701)-340-9361 email abraunberger@americanfenderal.net 5. Have you ever used Business Assistance Financing before? N( If yes, what, where and when? non -applicable PROJECT INFORMATION: 1. Location of Proposed Project: 101 Broadway W, Monticello, MN, 55362 2. Amount of Business Assistance Requested $300,000.00, 3% Interest, 10 -year term 3. Need for Business Assistance requested? Gap Funding 4. Present ownership of site: BLOCK 52 HOLDINGS LLC, a Minnesota limited liability company, BUCHHOLZ EXCHANGE LLC, a Minnesota limited liability company, and NORGREN EXCHANGE LLC, a Minnesota limited liability companv 5. Number of permanent jobs created as a result of project? 80-100 6. Estimated annual sales: Present N/A Future: N/A 7. Market Value of Project following completion 8. Anticipated start date: January 2024 Completion Date July 1, 2024 FINANCIAL INFORMATION: 1. Estimated project related costs: a. Land acquisition N/A b. Site Development N/A c. Building Cost N/A d. Equipment N/A e. Architectural/Engineering Fee $40,000.00 f. Legal fees $4,000.00 g. Off-site development Costs $180,000.00 2. Sources of financing: a. Private financing institution $1,350,000.00 b. Tax Increment funds no additional request c. Other public funds $300,000.00 d. Developer Equity 350,000.00 � �' `mss.. •� lb 6g, i1 ss lb ^° ss• ^°y + �z 4 °� 10 s• se• 1 ti O `330•Lsz•� 13 �14 zc. i // • .. JA e r' T' BLOCK 52 SITE PLAN CID WALGREENS F-, W: 2= �< KZ� K� �3v'�` Us w� m�� 5S =� C�� s 3� g�mos� 6 d•N VA 13, O� O QZ W J2 m� `az�3Il.71 moi in�LL�� W E �Z mcg, a '•�t I IIJIJ 2 o 1 11110- oLL �— 51: ,Y.er 1v� 10 pApA © ° 6.. 91 d W 810, 6� FFF i �i a �{ ❑v c K c yl• ___. f4 u m � v o ¢amr.ww NOTICE OF PUBLIC HEARING CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY WRIGHT COUNTY, MINNESOTA NOTICE IS HEREBY GIVEN that the Board of Commissioners of the City of Monticello Economic Development Authority (the "Authority") will hold a public hearing on Wednesday, February 14, 2024, at approximately 6:00 P.M. or as soon thereafter as the matter may be heard, in the Mississippi Room of the Monticello Community Center located at 505 Walnut Street in the City of Monticello, Minnesota (the "City") to consider the provisions of a proposed business subsidy under Minnesota Statutes, Sections 116J.993 through 1161995, as amended (the "Business Subsidy Law"), to the following recipients in connection with the build out of approximately 13,303 square feet of commercial office space at the real property located at 101 West Broadway Street in the City (the "Project"): (i) Block 52 Holdings LLC, Buchholz Exchange LLC, and Norgren Exchange LLC, each a Minnesota limited liability company, or to an entity(ies) related thereto or affiliated therewith; and (ii) [Simplicity Group] (collectively, the "Recipients"). Information about the proposed business subsidy for the Recipients is available for inspection at the office of the Authority's Executive Director at City Hall during regular business hours. After the public hearing, the Authority will consider granting the business subsidy in accordance with the proposed terms. A person with residence in or the owner of taxable property in the City may file a written complaint with the Authority if the Authority fails to comply with the Business Subsidy Law, and no action may be filed against the Authority for the failure to comply unless a written complaint is filed. All interested persons may appear at the hearing and present their views on the matters orally or provide their comments prior to the meeting in writing. Dated: February 1, 2024 BY ORDER OF THE BOARD OF COMMISSIONERS OF THE CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY /s/ Jim Thares Executive Director MN325\52\928400.v1 CITY OF MONTICELLO Schedule of Assets, Liabilities, Deferred Inflows of Resources, and Fund Balances Economic Development Authority & Small Cities Development Program December 31, 2023 - Unaudited TIF 6 (d) TIF 19 (d) TIF 20 (d) TIF 22 (d) TIF 24 TIF 29 TIF 30 TIF 34 (d) TIF 40 TIF 41 TIF 42 � 43 TIF 45 TIF 46 GAAP Total Total EDA General GMEF TIF Future Raindance MS Shores Prairie West Downtown St. Henry's Front Porch CMHP Interchange Briggs UMC Headwaters Headwaters Block 52 WiHa Reconciliation EDA SCDP ASSETS Cash and investments $ 2,114,264 $ 1,056,105 $ $ 49,450 $ 37,719 $ 104,142 $ 519,286 $ 55,800 $ 34,654 $ 80,227 $ 77,340 $ 13,478 $ 31,671 $ $ $ $ $ 4,174,136 $ 828,753 Receivables Unremitted taxes 753 - - - - - - - - - - - 753 - Delinquent taxes 1,722 2,687 4,409 Accounts 10,218 - - 10,218 Intrafund receivable 111,607 728,845 - (840,452) - Prepaid items 5,033 - . 5,033 - Notes receivable 127,246 191,541 - 318,787 110,748 Land held for resale 2,883,058 163,200 3,046,258 TOTAL ASSETS $ 5,253,901 $ 1,247,646 $ $ 778,295 $ 37,719 $ 104,142 $ 685,173 $ 55,800 $ 34,654 $ 80,22 7 $ 78 1,671 $ $ $ $ $ (840,452) $ 7,559,594 $ 939,501 LIABILITIES Accounts and contracts payable $ 16,639 $ $ $ $ $ $ $ $ $ $ $ - $ 127,246 $ $ $ $ 143,885 $ Intrafund payable - 45,363 4,644 728,845 400 400 400 400 (840,452) - Uneamed revenue - - 163,200 - - - - - - (163,200) - Escrow deposits 5,492 5,492 Total liabilities 22,131 45,363 163,200 644 728,845 400 127,646 400 400 (1,003,652) 149,377 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 1,7222 - - - - - - - - - - - - - 4,409 - FUND BALANCES Nonspendable 5,033 5,033 Restricted - 1,247,646 778,295 37,719 9,286 ,800 15,583 77,340 13,478 (697,174) (400) (127,646) (400) (400) 163,200 2,221,123 939,501 Assigned Economic Development 5,025,015 - (45,363) - - - - - - - - 4,979,652 - Fagade Grant 200,000 - - - - - - - - - - - - - - 200,000 - Total fund balance 5,230,048 1,247,646 45,3 778,295 37,71 104,142 5 55,800 34,654 15,583 77,340 13,478 (697,174) (400) (127,646) (400) (400) 163,200 7,405,808 939,501 TOTAL LIABILITIES, AND FUND BALANCES $ 5,253,901 $ 1,247,646 $ 778,295 $ 719 104,142 685,1 $ 55,800 $ 34,654 $ 80,227 $ 77,340 $ 13,478 $ 31,671 $ $ $ $ -L (840,452) $ 7,559,594 $ 939,501 Required or Actual Decertification Date 9/2013 12/3 2018 2/31/2023 12/31/2026 12/31/2029 12/31/2029 12/31/2022 1213112045 1213112031 12131/2050 12/31/2050 12131/2050 12/31/2032 TIF District Type elopment Ho Re ment Housing 8 Housing Housing Housing Redevelopment Housing Economic Housing Housing Redevelopment Economic (d) = decertified Redevelopment Development Development Schedule of Revenues, Expenditures and Other Financing Sources (Uses) Economic Development Authority & Small Cities Development Program For the Period Ended December 31, 2023 - Unaudited Revenues Property taxes Tax increments Intergovernmental Investment earnings Interest on loans Other revenues Total revenues Expenditures: Current Salary and wages Benefits Supplies Professional services - legal Professional services - other LPV Insurance Legal and general publications Marketing Dues and membership Utilities IT services Travel and conferences Other expenditures Excess increments Interest on intrafund loans PAYG payments to third parties Total expenditures Excess (deficiency) of revenues over expenditures Other financing uses Transfers in Net change in fund balances Fund balance at beginning of year Fund balance at end of yeas Required or Actual Decertification Date TIF District Type (d) = decertified 138,697 48,091 35 21,780 156,883 3,395 398 5,000 6,796 789 3,473 5,120 295,753 686,210 TIF 6 (d) TIF 19 (d) TIF 20 (d) TIF 22 (d) TIF 24 TIF 29 TIF 30 TIF 34 (d) TIF 40 TIF 41 TIF 42 EDA General GMEF TIF Future Raindance MS Shores Prairie West Downtown St. Henry's Front Porch CMHP Interchange Briggs UMC Headwaters (31,257) 3,481 3,344 3,300 (31,257) 1,449,767 41,292 $ 401,807 $ $ $ $ - $ $ - $ - $ - $ - $ $ - $ - $ - 37,749 269,641 55,830 34,684 17,576 70,020 65,098 284,123 - - - - - - - 206,458 1,963 3,481 29,294 3,300 897,651 3,481 29,294 37,749 269,641 55,830 34,684 17,576 70,020 65,09 138,697 48,091 35 21,780 156,883 3,395 398 5,000 6,796 789 3,473 5,120 295,753 686,210 Total 211,441 3,481 3,950 SCDP 215,391 3,481 5,014,657 1,244,165 (45,363) $ 5,230,048 $ 1,247,646 $ (45,363) Redevelopment CITY OF MONTICELLO IF 43 TIF 45 TIF 46 GAAP Total Total aters Block 52 WiHa Reconciliation EDA SCDP $ $ $ $ 401,807 $ 550,598 284,123 - 206,458 37,948 (31,257) 3,481 3,344 3,300 (31,257) 1,449,767 41,292 138,697 48,091 - 35 1,000 22,780 - 1,468 400 400 400 400 159,951 - - - - - - - 3,395 30 30 30 30 0 30 30 30 224 862 - - - - 5,000 6,796 789 3,473 5,120 295,753 0,20 - - 180,209 1,963 - 29,294 (31,257) - 63,018 63,018 3 1 9 30 1,993 30 63,048 30,986 400 400 400 400 (31,257) 933,969 ,719 (30) 88,4 55,800 34,654 15,583 (30) 6,972 34,112 (400) (400) (400) (400) 515,798 41,292 3,950 9 (30) 88,402 55,800 34,654 15,583 (30) 6,972 34,112 (400) (400) (400) (400) 519,748 41,292 104,172 430,884 - 77,370 6,506 (731,286) (127,246) - 163,200 6,886,060 898,209 7,719 $ 104,142 $ 519,286 $ 55,800 $ 34,654 $ 15,583 $ 77,340 $ 13,478 $ (697,174) $ (400) $ (127,646) $ (400) $ (400) $ 163,200 $ 7,405,808 $ 939,501 12/31/2023 12/10/2018 12/31/2023 12/31/2026 12/31/2029 12/31/2029 12/31/2022 12/31/2045 12/3112030 12/31/2050 12/31/2050 12/31/2050 12/31/2032 Housing Redevelopment Housing 8 Housing Housing Housing Redevelopment Housing Economic Housing Housing Redevelopment Economic Redevelopment Development Development EDA Agenda: 02/14/2024 5B. PUBLIC HEARING - Consideration of Resolution 2024-03 approving a Facade Improvement Forgivable Loan to Bliss Salon LLC, 109 Walnut Street, in the amount of $48,422 Prepared by: Meeting Date: ® Public Hearing Economic Development Manager 02/14/2024 ❑ Regular Agenda Item Reviewed by: Approved by: Community & Economic City Administrator Development Coordinator, Community Development Director, Finance Director ACTION REQUESTED Motion to adopt EDA Resolution 2024-03 approving a Fagade Improvement Loan to Bliss Salon in the amount of $48,422, contingent upon execution of the required Loan Agreement and Promissory Note by the applicant and compliance with cash match requirements. REFERENCE AND BACKGROUND The City has received a complete Fagade Improvement Forgivable Loan application from Bliss Salon LLC, located at 109 Walnut Street. The application submittal follows a December 2023 EDA workshop discussing the potential expansion of the Fagade Improvement Program target area and adoption of an amendment of the Policies at the January 10, 2024, regular meeting. Erika Fisher, owner of Bliss Salon, submitted improvement plans and quotes from contractors related to a proposal consisting of key exterior improvements, including new stucco finish and replacement of nine (9) windows on all four sides of the building, and installation of a new front entry door. The building was constructed in 1950 and the proposed facade improvements will bring a fresh new look to the property. The program policy amendments adopted by the EDA in January grant the EDA the flexibility to approve fagade improvements on any or all sides of the building. Under the Facade Loan program amendments approved by the EDA at the January 10, 2024, regular meeting, the language related to architectural renderings/plans allows for flexibility related to contractor supplied plans versus licensed architectural drawings. The plans submitted by Bliss comply with the intent of the amendment. Materials submitted for EDA review of the proposal include the following: ✓ A completed application with a summary of the proposal EDA Agenda: 02/14/2024 ✓ Improvement project quotes (two quotes as required by the program policy were submitted; the best desired quote consistent with policy is included in the packet) ✓ Affidavit regarding owner financial commitment (equity) ✓ Property and ownership information It should be noted that the window and door quotes are organized by front fagade only and then the remainder of the building. The stucco quote is for the entire building. The preferred contractors Building permit costs are eligible project expenses per the program policy. See the breakout below: ■ Windows - Front Building: $16,450 ■ Windows - Balance of Building: $18,650 ■ Stucco Work - Entire Building Exterior: $14,720 ■ Building Permit - $1,151 (Estimate by City staff) Total Improvement Project Cost: $50,971 As required by the program policy, Bliss Salon is required to contribute a minimum 5% match which totals $2,549. Bliss has indicated they will meet this requirement in cash payment to the contractor. Bliss will be required to make the initial payment, with proof of such payment to the EDA, prior to release of EDA funds. A Fagade Loan agreement and Promissory Note with key terms are attached to the report as exhibits. A public hearing is required as the amount of the loan reaches the threshold required for public comment under Minnesota's Business Subsidy Statute. Consistent with the program policy, the Loan is forgivable with the intent that it becomes a grant to the recipient if certain conditions of property ownership are met. As noted in the Loan Agreement, the loan forgiveness takes place in increments over three years. Budget Impact: The budgetary impact related to consideration of the Fagade Loan is the Fagade sub -fund itself. The Fagade Loan sub -fund currently has $200,000 available (only $50,000 has been expended from the original $250,000 allocated to the program). The EDA should also keep in mind that two properties (mattress store and dance studio) in Block 52 have previously submitted letters of interest and partially completed applications regarding proposed fagade improvement projects. Staff continue dialogue with those two applicants about the timing and the additional information needed to allow those proposals to be presented to the EDA for funding consideration. Legal fees for the preparation of the public hearing notice, resolution and the loan documents are estimated to cost $1,250 +/-. Staff Workload Impact: Staff involved in review of the facade proposal include the EDA attorney, Community & Economic Development Coordinator, Community Development Director, Building Official and Economic Development Manager. No EDA Agenda: 02/14/2024 additional staff are needed to complete the work tasks related to this proposal. III. Comprehensive Plan Impact: The Monticello 2040 Vision + Plan identifies the Downtown as a "development focus" area with the intent of promoting investment and redevelopment of key properties and parcels in the City's core area. The subject parcel, 109 Walnut Street, is located on a block adjacent to the Block 52 redevelopment project. By using its available tools such as the Fagade Loan Program to assist in property investment, the EDA is helping to facilitate the effort to realize Comprehensive Plan goal "A vibrant and thriving Downtown that contributes to the City's economic development and housing objectives" (Chapter 5, 2040 Plan). STAFF RECOMMENDATION Staff recommend approval of the Fagade Loan for Bliss Salon LLC in the amount of $48,422. Because this property is quite visible and may become even more so in the future due to a potential nearby parking lot project, staff further recommend that funding for all four sides of the building improvement proposal be authorized. SUPPORTING DATA: A. EDA Resolution 2024-03 B. Loan Agreement C. Promissory Note D. Fagade Loan Application E. Project Renderings F. Selected Contractor Project Quotes G. Aerial Photo H. Wright County Beacon Report I. Business Subsidy Public Hearing Notice J. EDA Year End 2023 Financial Statements EDA RESOLUTION NO. 2024-03 RESOLUTION APPROVING A LOAN AND BUSINESS SUBSIDY AGREEMENT BETWEEN THE CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY AND BLISS SALON LLC BE IT RESOLVED BY the Board of Commissioners ("Board") of the City of Monticello Economic Development Authority (the "Authority") as follows: Section 1. Recitals. 1.01. The Authority recognizes the need to encourage investment in commercial and retail buildings in the downtown area of the City of Monticello, Minnesota (the "City") in order to maintain the economic viability of the City and its Downtown/Central Community District and as such, has established a program to provide forgivable loans to eligible properties in the City's downtown to improve the fagades of existing commercial and retail buildings (the "Facade Program"). On November 9, 2022 and January 10, 2024, the Authority adopted revised guidelines for the Fagade Program (the "Guidelines"). 1.02. The Authority and Bliss Salon LLC, a Minnesota limited liability company (the "Borrower"), desire to enter into a loan agreement which has been presented to the Board (the "Loan Agreement") for a Fagade Program forgivable loan in the amount of $48,422 (the "Loan") to be used to pay a portion of the costs to replace 9 windows, 1 door, and the stucco exterior of the building (the "Improvements") located on that certain real property at 109 Walnut Street in the City (the "Property"). 1.03. The Authority is a grantor as defined in Minnesota Statutes, Sections 116J.993 to 116J.995, as amended (the "Business Subsidy Act"), is authorized to grant financial assistance ("Business Subsidy") for private development and has previously adopted criteria for awarding Business Subsidies that complies with the Business Subsidy Act. 1.04. On the date hereof, the Authority held a duly noticed public hearing regarding the provision of a Business Subsidy to the Borrower and a proposed business subsidy agreement (the "Business Subsidy Agreement") and determined that the creation and/or retention of jobs is not a goal of this Business Subsidy and instead the goal of the business subsidy is to help encourage investment in commercial and retail buildings in the City's business district and prevent blight and blighting factors therein. Therefore, notwithstanding the requirements of Section 116J.994, Subd. 2 of the Business Subsidy Act, the Authority determines that the terms of the Loan may deviate from the Authority's written business subsidy criteria, and hereby sets the job and wage goals of the Loan at zero. Section 2. Loan Agreement Approved. 2.01. The Authority hereby approves the Loan Agreement in substantially the form presented to the Board, including the Business Subsidy Agreement and the Escrow Agreement therein, together with any related documents necessary in connection therewith, including without limitation the Promissory Note, the Draw Request, and all documents, exhibits, certifications, or consents referenced in or attached to the Loan Agreement (the "Loan Documents"). 2.02. The Board hereby authorizes the President and Executive Director, in their discretion and at such time, if any, as they may deem appropriate, to execute the Loan Documents on behalf of the Authority, and to carry out, on behalf of the Authority, the Authority's obligations thereunder when all MN325\40\928073.v2 conditions precedent thereto have been satisfied. The Loan Documents shall be in substantially the form on file with the Authority and the approval hereby given to the Loan Documents includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the Authority and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the Authority. The execution of any instrument by the appropriate officers of the Authority herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. This resolution shall not constitute an offer and the Loan Documents shall not be effective until the date of execution thereof as provided herein. 2.03. In the event of absence or disability of the officers, any of the documents authorized by this resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by such other officer or officers of the Board as, in the opinion of the City Attorney, may act in their behalf. Upon execution and delivery of the Loan Documents, the officers and employees of the Board are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the Board to implement the Loan Documents. Approved this 14th of February, 2024, by the Board of Commissioners of the City of Monticello Economic Development Authority. President ATTEST: Executive Director MN325\40\928073.v2 LOAN AGREEMENT (Facade Improvement Forgivable Loan Program) THIS LOAN AGREEMENT (this "Agreement") is made effective as of , 2024, by and between BLISS SALON LLC, a Minnesota limited liability company (the `Borrower"), and the CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY, a public body corporate and politic and a political subdivision under the laws of the State of Minnesota (the "Lender"). RECITALS A. The Lender recognizes the need to encourage investment in commercial and retail buildings in the downtown area of the City of Monticello, Minnesota (the "City") in order to maintain the economic viability of the City and its Downtown/Central Community District and as such, has established a program to provide forgivable loans in amounts up to $50,000 to eligible properties in the City's downtown to improve the fagades of existing commercial and retail buildings (the "Fagade Program"). On November 9, 2022 and January 10, 2024, the Lender adopted revised guidelines for the Fagade Program (the "Guidelines"). B. The Borrower applied for and was awarded by the Lender on February 14, 2024, a forgivable loan from the Fagade Program to replace 9 windows, 1 door, and the stucco exterior of the building (the "Project") located at 109 Walnut Street in the City as legally described in EXHIBIT A attached hereto (the "Loan Property") and owned by the Borrower, in the principal amount of $48,422 (the "Loan"). C. The Loan constitutes a business subsidy within the meaning of Minnesota Statutes, Sections 116J.993 to 116J.995, as amended (the "Business Subsidy Act"), and the Lender has adopted criteria for awarding business subsidies that comply with the Business Subsidy Act after a public hearing for which notice was published in accordance with the Business Subsidy Act. D. The Lender has held a duly noticed public hearing on the business subsidy provided as represented by the Loan and this Agreement constitutes a subsidy agreement under the Business Subsidy Act. E. The Lender now makes the Loan to the Borrower subject to all of the terms and conditions of this Agreement. F. Contemporaneously with the execution hereof, the Borrower is delivering to the Lender a Promissory Note (the "Note") effective as of the date herewith made by the Borrower and payable to the order of the Lender, in the original principal amount of $48,422. NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained, it is hereby agreed as follows: 1. Amount and Purpose of Loan. The Borrower agrees to take and the Lender agrees to make the Loan in the principal amount of Forty -Eight Thousand Four Hundred Twenty Two and No/ 100 Dollars ($48,422) to be advanced in disbursements as hereinafter provided. The Loan will be evidenced by the Note. The Loan proceeds (the "Proceeds") will be used only towards the cost of the Project. 2. The Project. For the purposes of this Agreement, the term "Loan Property" means the real estate legally described in EXHIBIT A attached hereto together with all improvements now located or hereafter placed thereon. The Borrower agrees to replace 9 windows, 1 door, and the stucco exterior of the building on the Loan Property in accordance with and subject to the Guidelines. The Borrower will MN325\40\927236.0 complete the project no later than 180 days from the date hereof (the "Completion Date"). Failure to complete the Project on or before the Completion Date shall be a default hereunder. 3. Documents to be Delivered. The Borrower covenants and agrees to immediately cause the compliance with the following conditions: (a) Note. Deliver the Note to the Lender. (b) Architectural Rendering. Deliver to the Lender an architectural rendering (the "Architectural Rendering") of the final selected improvements. The Lender must provide final approval to the Architectural Rendering prior to the Borrower beginning work on the Project. (c) Project Cost and Source of Funds Certificate. Deliver to the Lender a sworn certificate detailing costs and sources of funds to be utilized for the Project ("Project Cost Certificate"), in a form acceptable to the Lender, verified on oath by an authorized representative of the Borrower showing an itemized breakdown of. (i) the source and amount of all Project funds; and (ii) of the total cost of the Project. Not less than 5% of the Project funds must come from the Borrower's own funds. The Borrower shall deliver to the Lender lien waivers, receipts for payment and other evidence of payment acceptable to the Lender with respect to any such portion of costs and charges incurred through the date of the Project Cost Certificate. (d) Insurance. Deliver to the Lender a certificate or policy for all insurance required, under the terms hereof to be maintained by the Borrower. (e) Compliance with Laws, Etc. Deliver to the Lender such evidence as the Lender may require as to the compliance of the Loan Property and the Project with: (i) all applicable laws, codes, rules, regulations and ordinances, including, without limitation, those relative to environmental protection, protection of wetlands, building and zoning matters and the Americans with Disabilities Act; and (ii) the requirements of any restrictive covenants, conditions and restrictions, conditional use permits or planned unit developments applicable to the Loan Property. The Lender may waive any of the above requirements in its sole discretion. 4. Disbursement of Loan. (a) All Proceeds shall be paid to Borrower in accordance with the terms and conditions of this Agreement. Notwithstanding anything to the contrary herein, if the cost of the Project exceeds the amount to be reimbursed under this Agreement, such excess shall be the sole responsibility of the Borrower. (b) On or about March 1 (the "Closing Date"), the Proceeds shall be deposited into an escrow account with an escrow agent (the "Escrow Agent") selected by the Lender. The disbursement of the Proceeds will be made subject to the conditions precedent that prior to or as of each date of disbursement: (i) The Lender has received from Borrower an executed copy of this Agreement and of an escrow agreement in substantially the form attached as Exhibit B (the "Escrow Agreement"); (ii) The Lender and Escrow Agent have received from the Borrower's authorized MN325\40\927236.0 representative one or more draw requests in substantially the form attached to the Escrow Agreement (each a "Draw Request"), certifying with respect to each requested disbursement: that each item for which the disbursement is proposed is included in the Project, accompanied by paid or payable invoices or other comparable evidence that the cost has been incurred and paid or is payable by Borrower; provided that each Draw Request must be made for a minimum amount of the lesser of $5,000 or the balance of escrowed Proceeds; (iii) Borrower has provided evidence satisfactory to Lender that Borrower has established an account for the exclusive purpose of recording the receipt and expenditure of the Proceeds; (iv) Borrower is in compliance with the terms of the Guidelines and this Agreement; (v) Prior to the final disbursement of the Proceeds, the Borrower shall: (1) notify the Lender when construction of the Project has been substantially completed. The Lender or their assignee will, within a reasonable time after such notification, inspect the Loan Property in order to determine whether the conditions set forth in Section 2 have been satisfied. If the Lender determines that the conditions set forth in Section 2 have not been satisfied, the Lender will provide a written statement indicating any deficiencies to be remedied by the Borrower and the Borrower shall remedy such deficiencies diligently and with reasonable dispatch to completion. If the Lender determines that the conditions set forth in Section 2 have been satisfied, the Lender will provide a written statement of completion (the "Completion Statement"); and (2) provide the Lender with: (a) lien waivers from all contractors and sub -contractors for all work and/or materials in connection with the Project; (b) a final Project Cost Certificate; (c) evidence acceptable to the Lender that the Borrower has expended its own funds on the Project in an amount at least equal to 5% of the total cost of the Project; and (d) final invoices from any and all contractors who worked on the Project. Fagade Program Requirements and Covenants. (a) Fagade Program. The Loan is made pursuant to the Fagade Program which provides loans for eligible fagade improvements. The loans are structured as 3 -year no -interest forgivable loans, whereby 50% of the total loan amount is forgiven after the first year and 25% of the total loan amount is forgiven after the second and third year. From and after the Closing Date through and until the Conversion Date (as defined below), the Borrower shall not be required to make any payments of principal or interest. (b) Guidelines. The Loan shall be forgiven as set forth below if the Borrower meets all of the following requirements: (i) Timely Completion of Project. All work on the Project must be completed Dy the Completion Date in accordance with and subject to the guidelines of the Fagade Program. (ii) Architectural Rendering. The Project must be completed in substantial MN325\40\927236.0 conformity with the Architectural Rendering as approved by the Lender. (iii) Transfer. Through March 1, 2027 (the "Maturity Date"), the Borrower shall not sell, transfer, lease, or convey the Loan Property or any part of it, or any interest therein, or encumber the Loan Property or any part of it, in any manner, without written consent of the Lender, which consent may be granted or withheld in the discretion of the Lender. This requirement shall apply to each and every sale, transfer, lease, or conveyance, whether voluntary or involuntary and whether or not the Lender has consented to any such prior sale, transfer, lease, or conveyance. (iv) No Defaults. As of each Determination Date (as defined below), there are no defaults under this Agreement or any other agreement between the Lender and the Borrower which is beyond any notice and cure period. (c) Compliance Determination. On March 1, 2025 and on each March 1 thereafter through and including the Maturity Date (each a "Determination Date"), the Lender will determine, in its sole and absolute discretion, whether the Borrower has fully and timely complied with the requirements of this Section 5 as of such date. The Borrower will promptly provide all such documentation as the Lender reasonably requests in the Lender's effort to determine whether the Borrower has timely complied with the requirements of this Section 5. If the Lender determines, in its sole and absolute discretion, that the Borrower has fully and timely complied with the requirements of this Section 5 as of such date, as strictly interpreted, the Lender will forgive a portion of the principal amount of the Loan as of each such Determination Date and the principal balance of the Loan and the Note shall be deemed reduced and outstanding in the following amounts as of each Determination Date: Determination Date: Deemed Outstanding Principal Balance March 1, 2025 $24,211 March 1, 2026 $12,106 March 1, 2027 $0 (d) Conversion. If the Lender determines at any time that the Borrower has not or cannot fully or timely comply with the requirements of this Section 5, then the Loan shall no longer be forgivable, and the Borrower shall repay the outstanding balance of the Loan not later than 30 days after the Lender sends written notice thereof (the "Conversion Date") in accordance with the loan payoff as of such Conversion Date set forth below: Conversion Date: Loan Payoff Amount March 1, 2024- February 28, 2025 $48,422 March 1, 2025- February 28, 2026 $24,211 March 1, 2026- February 28, 2027 $12,106 The terms and conditions of this Agreement and any other related loan document and the Borrower's obligations thereunder shall continue until the Loan is repaid in full. (e) Final Maturity. Within a reasonable time after full and final payment or forgiveness of the Loan, the Lender will return the Note to the Borrower. Access to Loan Property. The Lender and its respective representatives shall have at all MN325\40\927236.0 reasonable times the right to enter and have free access to the Loan Property and the right to inspect the Loan Property. 7. Books and Records. The Borrower agrees to maintain accurate and complete books, accounts, and records in regard to the Project in a manner reasonably acceptable to the Lender. Such books, accounts, and records shall be kept and maintained by the Borrower for a period of six (6) years following the Termination Date (as hereinafter defined). Accounting methods shall be in accordance with generally accepted accounting principles. The Lender, acting solely through its municipal or financial advisor, shall have the right to inspect, examine and copy all such books and records of the Borrower and the Borrower shall, at the Lender's request, furnish such information solely to the Lender's municipal or finance advisor, as may reasonably be demanded. Time of Essence. Time is of the essence in the performance of this Agreement. 9. Assi ng ability. The Borrower shall not assign this Agreement without the prior written consent of the Lender, which consent may be withheld, conditioned, or delayed in the Lender's sole discretion. The Lender may freely assign or otherwise transfer (including by participation) all or any part of its interest in the Loan or any or all of the Loan documents, at the Lender's sole discretion. 10. Miscellaneous Covenants of Borrower. The Borrower covenants and agrees with the Lender that, without cost to the Lender, the Borrower will: (a) Performance of Conditions. Promptly keep, perform and comply with all of the terms, covenants and conditions to be kept and performed by the Borrower as required by the City and any other governmental body having jurisdiction over the Loan Property as a condition of platting, rezoning or developing the Loan Property; keep unimpaired the rights of the Borrower under any permit or agreement issued or made by the City or other governmental body having jurisdiction over the Loan Property and any contracts obtained or held by the Borrower in connection with the construction of the Project; and to enforce the prompt performance of all of the terms, covenants and conditions to be kept and performed by the City or other governmental body having jurisdiction over the Loan Property, respectively, under any permits or agreements issued or made by the City or such other governmental bodies, and any contractors under all contracts obtained or held by the Borrower in connection with construction of the Project. (b) Amendment, Etc. of Documents. Not amend, cancel, terminate, supplement, or waive any of the material terms, covenants, and conditions of any permit or agreement issued or made by the City or any other governmental body having jurisdiction over the Loan Property, or any other contracts obtained or held by the Borrower in connection with the construction of the Project or any contracts, documents or agreements referred to herein without the prior written approval of the Lender. The Borrower will provide the Lender with complete documentation concerning any change made to the Project. (c) Performance of Note, etc. Without limiting the foregoing, keep and perform all of the terms, covenants, conditions and requirements of the Note and this Agreement. (d) Insurance. During the term of this Agreement, the Borrower shall procure and maintain or cause to be procured and maintained at their sole expense, casualty insurance, public liability insurance and such other types of insurance as are reasonably required by the Lender from time to time, insuring the Lender and the Borrower with coverages, in amounts and with companies MN325\40\927236.0 satisfactory to the Lender. (e) Pam. Pay at closing, or within 30 days of written notice from the Lender, all loan charges including, but not limited to: (i) the Lender's attorneys' fees; and (ii) filing fees of any instruments required under this Agreement. (f) Default Notices. Provide the Lender with a copy of any default notice received by the Borrower, pursuant to any documents related to any financing secured by the Loan Property or any governmental authority, promptly after receipt of the same. 11. Warranties. The Borrower represents and warrants to the Lender the following: (a) The making and performance of this Agreement and the execution and delivery of the Note and any other instrument required hereunder are within the powers of the Borrower and have been duly authorized by all necessary organizational action on the part of the Borrower. This Agreement and the Note, and any other instruments required hereunder have been duly executed and delivered and are the legal, valid, and binding obligations of the Borrower enforceable in accordance with their respective terms. (b) No litigation, tax claims or governmental proceedings are pending or threatened against the Borrower, and no judgment or order of any court or administrative agency is outstanding against the Borrower which would have a material adverse effect on the Borrower. (c) The Borrower has filed all tax returns (federal and state) required to be filed for all prior years and paid all taxes shown thereon to be due, including interest and penalties. The Borrower will file all such returns and pay all such taxes for the current and future years. (e) All information, financial or other, which has been submitted by the Borrower in connection with the Loan is true, accurate, and complete in all material respects. 12. Indemnification. The Borrower shall defend, hold harmless and indemnify the Authority and its officials, commissioners, officers, agents and employees from and against all claims, liability, costs, expenses, loss or damages of any nature whatsoever, including reasonable attorneys' fees, arising out of or in any way connected with its failure to perform its covenants and obligations under this Agreement and any of its operations or activities related thereto. The provisions of this paragraph shall survive the termination of this Agreement. This indemnification shall not be construed as a waiver on the part of either the Borrower or the Authority of any immunities or limits on liability provided by applicable Minnesota law. 13. Business Subsidy Agreement. (a) Public Purpose. In order to satisfy the provisions of the Business Subsidy Act, the Borrower acknowledges and agrees that the amount of the "Business Subsidy" granted to the Borrower under this Agreement is the Loan, and that the Business Subsidy is needed to improve the fagade of the Loan Property to encourage investment in commercial and retail buildings in the downtown area of the City in order to maintain the economic viability of the City and its Downtown/Central Community District. The public purpose of the Business Subsidy is to remove blight in the City's downtown and increase the tax base of the City and the State. The goals of the Business Subsidy are to revitalize the City's downtown through fagade improvements and blight elimination and increase the tax base of the City and the State. MN325\40\927236.0 (b) Operation of Site. The Borrower shall continue its operations at the Loan Property (the "Qualified Facility") for at least 5 years after the Benefit Date (defined hereinafter). The Project will be a Qualified Facility as long as the Loan Property is operated by the Borrower. The parties agree that the "Benefit Date" is the date that the Lender delivers the Completion Statement. (c) Job and Wage Goals. Following a public hearing pursuant to Minnesota Statutes, Section 116J.994, subd. 4, the Lender has determined that the creation or retention of jobs is not a goal of the Business Subsidy, and accordingly, wage and job goals for the Business Subsidy are set at zero. (d) Remedies. Failure to meet the goals described in (a) and (b) hereto (the "Goals") shall be an Event of Default. (i) if the failure relates to maintenance of the facility as a Qualified Facility in accordance with Section 13(b) hereof, 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 Lender, divided by 60; and (ii) Nothing in this Section shall be construed to limit the Lender's remedies under Section 15 hereof. In addition to the remedy described in this Section and any other remedy available to the Lender for failure to meet the Goals the Borrower agrees and understands that it may not receive a business subsidy from the Lender or any grantor (as defined in the Business Subsidy Act) for a period of 5 years from the date of the failure or until the Borrower satisfies its repayment obligation under this Section, whichever occurs first. i. Reports. To the extent required by the Minnesota Department of Employment and Economic Development, within 30 days of a request from the Lender, the Borrower agrees to (i) report its progress on achieving the Goals to the Lender until the later of the date the Goals are met or two years from the Benefit Date, (ii) include in the report the information required in Section 116J.994, Subdivision 7 of the Business Subsidy Act on forms developed by the Minnesota Department of Employment and Economic Development, and (iii) send completed reports to the Lender; provided, however, that such reporting obligations will not affect the terms of this Agreement which set the job and wage goals at zero or effect any obligation for the Borrower to meet any greater Goals than those contemplated herein. If the Borrower fails to timely file any report required under this Section, the Lender will mail the Borrower a warning within one week after the required filing date. If, after 14 days of the postmarked date of the warning, the Borrower fails to provide a report, the Borrower must pay to the Lender a penalty of $100 for each subsequent day until the report is filed. The maximum aggregate penalty payable under this Section is $1,000. ii. Other assistance. There are no other state or local government agencies providing financial assistance for the Project other than the Lender. iii. Parent Corporation. The Borrower does not have a parent corporation. 14. Defaults. Each of the following shall constitute an Event of Default: (a) If the Borrower fails to pay when due any amount due under this Agreement, the Note, or any other documents listed in Section 3. MN325\40\927236.0 (b) Bankruptcy, reorganization, assignment, insolvency or liquidation proceedings, or other proceedings for relief under any applicable bankruptcy law or other law for relief of debtors are instituted by or against the Borrower and, if such proceedings are instituted against the Borrower, an order, judgment or decree, without the consent of the Borrower appointing a trustee or receiver for the Borrower or any part of its property or approving a petition under the bankruptcy laws of the United States or any similar laws of any state or other competent jurisdiction, shall have remained in force undischarged or unstayed for a period of 30 days. (c) Any of the terms, covenants, or conditions of any permit or other agreement issued or made by the City or other governmental body having jurisdiction over the Loan Property are not complied with within the time required thereby or are terminated or modified by the City or such other governmental body and the Borrower has not taken the necessary steps to correct or cure the same within 30 days after written notice is given by the Lender. (d) Any mechanic's or material supplier's lien is filed, against the Loan Property and is not released, satisfied, or discharged or bonded to the Lender's satisfaction. (e) A transfer which violates Section 5(b)(ii) hereof occurs or the Borrower abandons the Loan Property. (f) The Borrower fails: (i) to complete construction of the Project by the Completion date; (ii) to construct the Project in accordance with this Agreement; (iii) to observe or perform any other covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement, the Note, or any other document executed by the Borrower pursuant to this Agreement; or (iv) fails to pay any amount or perform any obligation under any other note, mortgage or other agreement now or hereafter made by the Borrower in favor of or with the Lender or otherwise now or hereafter made by the Borrower in connection with the Loan Property, and any such failure continues 30 days after written notice is given by the Lender. (g) Any representation or warranty by the Borrower contained herein or in the Note, or any other instrument required hereunder is false or untrue in any material respect when made. 15. Remedies. Upon the occurrence of an Event of Default, the Lender, at its option, shall, in addition to any other remedies which it might be entitled to by law, have the right to: (a) Perform such other acts or deeds which reasonably may be necessary to cure any default existing under this Agreement, and to this end, it is hereby agreed as follows: (i) All sums expended by the Lender in effectuating its rights under paragraphs (ii) and (iii) of this paragraph shall be deemed to have been advanced under this Agreement and to be secured by any security document required under this Agreement as security for the Loan. (ii) The Lender, at its option, shall have the right to enter into possession of the Loan Property and perform any and all work and labor necessary to complete the Project substantially as required under this Agreement and to do all things necessary or incidental thereto. The powers herein granted the Lender shall be deemed to be powers coupled with an interest and the same are irrevocable. MN325\40\927236.0 (b) cancel this Agreement; (c) bring appropriate action to enforce such performance and the correction of such Event of Default; (d) declare the entire unpaid principal of the Note immediately due and payable without notice; and (e) pursue whatever action, including legal, equitable or administrative action, which may appear necessary or desirable to collect all costs (including reasonable attorneys' fees) and any amounts due under this Agreement or to enforce the performance and observance of any obligation, agreement, or covenant hereof. 16. Default under Note. The failure by the Borrower to keep or perform any of the terms, covenants, and conditions to be kept or performed by it under this Agreement shall constitute a default under the Note. 17. Notices. Any notices given hereunder shall be in writing and shall be deemed to have been given when delivered personally or three (3) days after deposited in the United States mail, registered, postage prepaid, addressed as follows: If to the Borrower: If to the Lender: Bliss Salon LLC 109 Walnut Street Monticello, MN 55362 Attn: Erika Fisher City of Monticello Economic Development Lender 505 Walnut Street Monticello, MN 55362 Attn: Executive Director or addressed to any such party at such other address as such party shall hereafter furnish by notice to the other party. Any notice delivered personally to the Borrower shall be delivered to an officer of the Borrower, and any notice delivered personally to the Lender shall be delivered to an officer of the Lender at the address for the Lender for the mailing of notices. Either party may change its address for the giving of notices by giving the other party at least 10 days' notice in the manner provided above. 18. Termination. This Agreement shall terminate on the later of the Maturity Date or the date that the Loan has been paid in full (the "Termination Date"). Notwithstanding anything herein to the contrary, the indemnification provisions provided in Section 12 hereof shall not terminate on the Termination Date. 19. Headings. The headings used in this Agreement are for convenience only and do not define, limit, or construe the contents of this Agreement. 20. Bindings on Successors and Assigns. Subject to the limitations on transfer contained in MN325\40\927236.0 this Agreement, this Agreement shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto. 21. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of Minnesota, without giving effect to any choice or conflict of law provision or rule. 22. Counterparts. This Agreement may be executed in 2 or more counterparts, each of which shall be an original and all of which shall constitute the same agreement. 23. Entire Agreement. This Agreement, the Note and the other documents executed by the Borrower and/or the Lender pursuant to this Agreement contain the entire agreement between the parties with respect to the subject matter hereof and supersede all prior understandings and agreements, both oral and written. This Agreement may be amended only in a writing signed by the parties hereto. 24. Fees and Expenses. the Borrower agrees to pay to the Lender immediately upon demand all costs and expenses, including, without limitation, all attorneys' fees, incurred by the Lender in connection with the enforcement of the Lender's rights and/or the collection of any amounts which become due to the Lender under this Agreement, the Note or the other documents executed in connection herewith; and the prosecution or defense of any action in any way related to this Agreement, the Note or the other documents executed in connection herewith. 25. Electronic Signatures; Execution in Counterparts. The electronic signature of the parties to this Agreement shall be as valid as an original signature of such party and shall be effective to bind the parties hereto. For purposes hereof, (i) "electronic signature" means a manually signed original signature that is then transmitted by electronic means; and (ii) "transmitted by electronic means" means sent in the form of a facsimile or sent via the internet as a portable document format ("pdf') or other replicating image attached to an electronic mail or internet message. 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. 26. Data Practices. All data collected, created, received, maintained or disseminated for any purpose in the course of Borrower's performance of this Agreement is governed by the Minnesota Government Data Practices Act, Minn. Stat. Ch. 13, and any other applicable state statutes, any state rules adopted to implement the Act and statutes, as well as federal statutes and regulations on data privacy. 27. Audits. The accounts and records of the Borrower described in paragraph (1) above shall be audited in the same manner as all other accounts and records of the Borrower and may, for a period of six (6) years following the Termination Date, be inspected on the Borrower's premises by the Authority or individuals or organizations designated by the Authority, upon reasonable notice thereof to the Borrower. The books, records, documents and accounting procedures relevant to this Agreement are subject to examination by the State Auditor in accordance with Minnesota law. MN325\40\927236.0 IN TESTIMONY WHEREOF, the Borrower causes this Agreement to be effective as of the day and year first above written. BLISS SALON LLC 1-2 Erika Fisher Its: Owner S-1 MN325\40\927236.0 IN TESTIMONY WHEREOF, the Lender causes this Agreement to be effective as of the day and year first above written. CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Name: Steve Johnson Its: President Name: Jim Thares Its: Executive Director S-2 MN325\40\927236.0 EXHIBIT A LOAN PROPERTY That certain real property legally described as: That part of Lots 11 and 12, Block 51, Townsite of Monticello according to plat on file and of record in the Office of the County Recorder, in and for the County of Wright, State of Minnesota, described as follows; Beginning at the Southeast corner of said Lot 11; thence on an assumed bearing of the North 64 degrees 05 minutes 32 seconds West along the Southwesterly line of said Lots 11 and 12 to a point distant 9.00 feet Northwesterly of the Southeast corner of said Lot 12; thence North 26 degrees 00 minutes 06 seconds East, parallel with the Southeasterly line of said Lot 12, 75.00 feet; thence South 64 degrees 05 minutes 26 seconds East, to a point on the Southeasterly line of said Lot 11 distant 75.00 feet Northerly of the Southeast corner of said Lot 11; thence South 26 degrees 00 minutes 00 seconds West along said Southeasterly line, 75.00 feet to the point of beginning. A-1 MN325\40\927236.0 EXHIBIT B ESCROW AGREEMENT FACADE IMPROVEMENT FORGIVABLE LOAN PROGRAM ESCROW AGREEMENT This Agreement is entered into this _ day of , 20_, by and between Bliss Salon LLC, a Minnesota limited liability company (the "Borrower"), , a Minnesota (the "Escrow Agent"), and the City of Monticello Economic Development Authority, a public body corporate and politic under the laws of Minnesota (the "Authority"). Purpose The purpose of the escrow established pursuant to this Agreement is to provide assurance to the Authority that Borrower will complete the Project described in the Loan Agreement between the Authority and the Borrower dated (the "Loan Agreement"), which is incorporated herein by reference. All capitalized terms which are not otherwise defined herein shall have the meanings set forth in the Loan Agreement. Escrow The Escrow Agent hereby acknowledges receipt from the Authority of Proceeds in the amount of $48,422 to be disbursed in connection with the construction by Borrower of the Project. Proceeds will be disbursed to the Borrower in one or more payments as evidenced by the provisions of this section. Before disbursement of any Proceeds deposited hereunder, Borrower must submit to the Authority and Escrow Agent a draw request in substantially the form attached hereto as Exhibit A (the "Draw Request") containing evidence showing that costs for the Project have been paid or incurred by the Borrower in at least the amount requested, provided that (i) Draw Requests must be made for a minimum of the lesser of $5,000 or the balance of unpaid Proceeds, and (ii) no Proceeds will be disbursed until Borrower provides evidence that Borrower has paid Borrower's required share of total costs of the Project. Prior to the final disbursement of Proceeds, the Borrower shall: (i) notify the Lender when construction of the Project has been substantially completed. The Lender or their assignee will, within a reasonable time after such notification, inspect the Loan Property in order to determine whether the conditions set forth in Section 2 have been satisfied. If the Lender determines that the conditions set forth in Section 2 have not been satisfied, the Lender will provide a written statement indicating any deficiencies to be remedied by the Borrower and the Borrower shall remedy such deficiencies diligently and with reasonable dispatch to completion. If the Lender determines that the conditions set forth in Section 2 have been satisfied, the Lender will provide a written statement of completion (the "Completion Statement"); and (ii) provide the Lender with: (a) lien waivers from all contractors and sub -contractors for all work and/or materials in connection with the Project; (b) a final Project Cost Certificate; (c) evidence acceptable to the Lender that the Borrower has expended its own funds on the Project in an amount at least equal to 5% of the total cost of the Project; and (d) final invoices from any and all contractors who worked on the Project. The Authority may, if not satisfied with any evidence provided, request such further documentation or clarification as the Authority may reasonably require. B-1 MN325\40\927236.0 The Authority will authorize disbursement by the Escrow Agent of the Proceeds upon receipt and approval of the Borrower's Draw Request evidencing costs of the Project exceeding Borrower's required contribution by at least the amount of the requested disbursement. Final disbursement of Proceeds must be made no later than six months after the date hereof. Indemnity Borrower agrees to indemnify and hold harmless the Authority from and against any claim, damage, liability, loss or expense, including reasonable attorney's fees, made by any parry in connection with the performance of obligations under this Agreement. Title and Escrow Charges Any escrow fees will be paid by Authority. Termination This Agreement will terminate upon the earlier to occur of one of the following: i) mutual written agreement of the parties; ii) disbursement of all Proceeds to Borrower; or iii) [date six months after execution of Agreement] (the "Termination Date"). Any balance of Proceeds remaining in escrow as of the Termination Date will be returned to the Authority. B-2 MN325\40\927236.0 BLISS SALON LLC By: _ Date: CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY By: Its President By: Its Executive Director [Escrow Agent] By: Its B-3 MN325\40\927236.0 Date: Date: Date: EXHIBIT A TO ESCROW AGREEMENT DRAW REQUEST — DOWNTOWN FACADE IMPROVEMENT PROGRAM TO: City of Monticello Economic Development Authority 505 Walnut Street, Suite 1 Monticello, MN 55362 Attn: Executive Director DISBURSEMENT DIRECTION The undersigned Authorized Representative of Bliss Salon LLC, a Minnesota limited liability company (the "Borrower"), hereby authorizes and requests you to disburse from the Proceeds, in accordance with the terms of the Loan Agreement between the City of Monticello Economic Development Authority (the "Lender") and the Borrower, dated as of , 2024 (the "Agreement"), and the Escrow Agreement, the following amount to the following person and for the following proper costs of the Project: 1. Amount: 2. Payee: 3. Purpose: all as defined and provided in the Agreement. The undersigned further certifies to the Lender that (a) none of the items for which the payment is proposed to be made has formed the basis for any payment previously made under Section 4 of the Agreement (or before the date of the Agreement); (b) each item for which the payment is proposed is eligible for funding from the Proceeds; and (c) the Borrower has paid, at the Borrower's sole expense, $ in costs of the Project, representing at least the Borrower's 5% required share of such costs. All capitalized terms which are not otherwise defined herein shall have the meanings set forth in the Loan Agreement. Dated: Borrower's Authorized Representative B-4 MN325\40\927236.0 PROMISSORY NOTE (Facade Improvement Forgivable Loan Program) , 2024 Amount: $47,970 Interest: 0.00% Maturity Date: March 1, 2027 FOR VALUE RECEIVED, the undersigned, BLISS SALON LLC, a Minnesota limited liability company ("Borrower"), promises to pay to the order of CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY, a public body corporate and politic and a political subdivision under the laws of the State of Minnesota ("Lender"), at 505 Walnut Street, Monticello, Minnesota 55362, or such other place as Lender or any other holder of this Note may designate in writing, on or before the Maturity Date (as defined above), the principal sum of Forty -Seven Thousand Nine Hundred Seventy and No/100 Dollars ($47,970), without interest. This Note is made pursuant to a Loan Agreement, between Borrower and Lender, of even date herewith ("Loan Agreement"). All capitalized terms which are not otherwise defined herein shall have the meanings set forth in the Loan Agreement. This Note is made pursuant to the Program and the Guidelines. As of each Determination Date (as defined in the Loan Agreement), Lender will forgive a portion of the principal balance of the Note, subject to and in accordance with the terms of the Loan Agreement. If Lender determines at any time that Borrower is not in compliance with the terms of the program, subject to and in accordance with the terms of the Loan Agreement, Borrower will be required to promptly pay the outstanding principal hereunder on the Conversion Date (as defined in the Loan Agreement). If the Lender, or any other holder of this note, has not received the full amount of any outstanding principal provided for in this note, by the end of 7 calendar days after the date it is due, Borrower shall pay a late charge fee to the Lender, or any other holder of this note. The amount of the late charge fee shall be 8.00% of the overdue outstanding principal. The Borrower shall pay this late charge fee on demand, however, collection of the late charge fee shall not be deemed a waiver of the Lender's right to declare an Event of Default and exercise its rights and remedies as provided for in the Loan Agreement and the Security Documents. Each payment made under this note shall be applied as follows: (i) first, to be applied against and pay unpaid late charges and any other charges, including attorneys' fees and protective advances; and then (ii) all remaining amounts, if any, shall be applied against and reduce the then outstanding principal balance of this Note. If an Event of Default shall occur hereunder or under the Loan Agreement and any cure period provided for in the Loan Agreement has expired, the entire principal amount outstanding and any other charges due hereon shall at once become due and payable at the option of the Lender or the holder hereof. Any failure of the Lender to exercise its right to accelerate this note at any time shall not constitute a waiver of the right to exercise the same right to accelerate the note at any subsequent time. The Borrower may prepay the principal under this note at any time and from time to time, in whole or in part, without premium or penalty. MN325\40\928070.v1 All sums payable to the Lender under this Note shall be paid in immediately available funds. The Borrower promises to pay all costs in connection with the enforcement of this Note, including but not limited to, those costs, expenses, and attorneys' fees of Lender whether or not suit is filed with respect thereto and whether or not such cost or expense is paid or incurred or to be paid or incurred prior to or after the entry of judgment or for the pursuance of, or defense of, any litigation, appellate, bankruptcy, or insolvency proceeding. Presentment, notice of dishonor and protest are hereby waived by all makers, sureties, guarantors, and endorsers hereof. This Note shall be binding upon Borrower, its successors, and assigns. The remedies of Lender, as provided herein and in the Loan Agreement, shall be cumulative and concurrent and may be pursued singly, successively, or together, at the sole discretion of Lender, and may be exercised as often as occasion therefor shall occur; and the failure to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. Time is of the essence hereof. This Note shall be governed by and be construed under the laws of the State of Minnesota, without regard to principles of conflicts of law. [Signature Page Follows] 2 MN325\40\928070.v1 IN WITNESS WHEREOF, the undersigned has caused this Note to be effective as of the day and year first above written. BLISS SALON LLC Erika Fisher Its: Owner S-1 MN325\40\928070.v1 Montice �llo 1. CONTACT INFORMATION Legal Name of Business: Project Site Address: City / State / Zip: MONTICELLO EDA DOWNTOWN FACADE IMPROVEMENT FORGIVABLE LOAN PROGRAM APPLICATION hss Lalm L""L�i icPIIn.Mw �—�5 Contact Person(s): � �" 1 FuOiC4 r Business Phone: Email 1 0 'vl com Home Phone: S4MC M,? Check One: A Proprietor ❑ Corporation ❑ Partnership '3,Federal ID # / `(>'t" -T State ID # Legal Name of Property Owner: r -i Project Site Address: City / State / Zip: L�r Contact Person(s): EYlKa Business Phone: 70392 3 eiS 02- Email: CI)X 90 qma 1 I • C,C/m 2. PROJECT GOALS Please give a brief summary of the project: w)rUows,ldoor,0IhY I Th? sca K 0�' nr1� � o v�S 04 MiWt S W �C/0 . 1 IPage Please describe how the proposed project will positively impact the city's downtown/Central Community District:] PO sS Sa�o►� -4-tt`s pr0�W h0, an l rnt�gra[ pa✓f OF -t�iS CDm'n Lt n' I sin �, aAd - n wn-to min M 0r1'h C4MZ .Thu. C�t�/o r of �u-, tv-Lt great � � n b� 9 � Cov-Me rsfb� Q �o d UV- bK oUdfhg has a- symbol of our ot,&dr«fi'dr? tv �+e corn n7U.h /Tyr, anon we ifmve tea+ by re v1'fa�i�Ziny its we, la n can 4T i KfC tU Aic vt/ei► -a.,0 a?Gsth e He d- V'i'm!i f� ,,�' Hu a,rz— We i2ti41,&r mat-mese i nnP'-Vve rnen riot ee l y ben-e4' to u r b S1Yt9sS JAV- r fso have a. P0601 r'o t rn paa an - -r,,,c 4k7+(, r60MMW7 1`cy�rcc fr'n9 Ot MO rt ct-H'raCP ,mac ,- w&l c o� r Wt to & 1T-Ci f1'7`6, + 91,7PPO r- -ORIC4- l PC" bUS1 r)e�s r es . I¢Gl i �ex� +�t- 4-h s P ry J ccf a) ig hs W r `moi cyak L-019 of/r) d +,-It 6)'fj o 1 M 04-ft ucto Md wit t Ca►,�� bwt of ouV- i0 (&,e 3. PROJECT FUNDING A. FORGIVABLE LOAN USE FUNDING REQUEST Maximum grant amount of $50,000 Fagade Improvements x 4"1,qlo Frontage Improvements $ (Signage, awnings, permanent landscaping) Total Loan Request: $ B. OTHER PROPOSED FUNDING SOURCES Bank Loan $ Private Fund Commitment (50/0 required) $ Applicant Commitment Other Total Other Funding Sources $ PROJECT TOTAL: 4. PROJECT CONTACTS (Lenders, private funding source, partners, etc...) 211',1`,`, Name AV91—AftVzrl' OfiH-er-IMq6 O!7,V- Address �✓� r e/%O(,( /0& Phone/Email: 3.20-4964--27417 AdakW01t)&VW'fiA1.rP17 Name Address Phone/Email: 6. ATTACHMENTS CHECK LIST Please attach the following: A) Letter of Commitment from the Other Sources of Financing, Stating Terms and Conditions of their Participation in Project (if applicable) B) Project Plans (Architectural Rendering and Scope must be included) C) Project Quotes/Estimates D)Property Legal Description 7. AGREEMENT I / We certify that all information provided in this application is true and correct to the best of my/our knowledge. I / We authorize the Monticello EDA to verify financial and other information. I / We agree to provide any additional information as may be requested by the city. The undersigned has received the EDA's policy regarding the payment of costs of review, understands that the EDA requires reimbursement of costs incurred in reviewing the application, agrees to reimburse the EDA as required in the policy and make payment when billed by the EDA, and agrees that the application may be denied for failure to reimburse the EDA for costs as provided in the policy. APPLICANT SIGNATURE ( ltd" vd V WK APPLICANT FAME (Print): hpv PROPERTY OWNER NAME (Print):` PROPERTY OWNER SIGNATURE: DATE: The EDA is a governmental entity and as such must provide public access to public data it receives. Data deemed by Applicant to be nonpublic data under State law should be so designated or marked by Applicant. See Minnesota Statutes, Sections 13.591, Subd.1 and 2. 3 1 P a g e BLISSSALONLLC 109 WALNUT STREET, MONTICELLO, MN 55362 Black Aluminum Black Aluminum Commercial door Commerciat x 1 Windows x1 'j t - White Stucco Black Aluminurn Commercial Windows x3 t x r t BLISSSALONLLC 109 WALNUT STREET, MONTICELLO, MN 55362 Black Aluminum Commercial Window xl F t White Stucco pg. 3 BLISS SALON LLC 109 WALNUT STREET, MONTICELLO, MN 55362 Black Aluminum Commercial window x1 White Stucco BLISS SALON LLC 109 WALNUT STREET, MONTICELLO, MN 55362 Black Aluminum Commerical Windows x3 Y-- .��4,f EAST SIDE GLASS 305 Franldin Ave NE St. Cloud, MN 56304 Phone: (320)251-1900 Fax: (320)251-9471 -,-ti«v. eastsideglass-mn. c om Customer BLISS SALON, LLC 109 WALNUT ST MONTICELLO MN 55362 Quote: 60735 Date:01/30/2024 CsrANDY F Tech: PO BLISS SALON TermsC.O.D Qty Part/ Description 1 COMMERCIAL - PROJECT AS QUOTED FURNISH AND INSTALL (1) NEW EXTERIOR COMMERCIAL ALUMINUM ENTRY AND (4) NEW EXTERIOR STATIONARY COMMERCIAL ALUMINUM WINDOWS. ENTRY INCLUDES: (DARK BRONZE ANODIZED FINISH) FRAMING = 1-3/4" X 4-1/2" F.S. = 39-1/2" X 85-3/4" ROUGH OPENING NEEDED = 40-1/2" X 86-1/4" MEDIUM STILE DOOR W/ 10" BOTTOM RAIL (3'-0" X 7-0" D.O.) EXTERIOR/INTERIOR KEYED CYLINDER LOCKING W/ HOOKBOLT EXIT INDICATOR STANDARD DOOR CLOSER 3 -BUTT HINGES THRESHOLD DOOR SWEEP 1" CLEAR TEMPERED INSULATED GLASS W/ LOW -E RH OUTSWING DOOR WINDOWS INCLUDE: (DARK BRONZE ANODIZED FINISH) FRAMING = 2" X 4-1/2" (2) ROUGH SIZE = 101"W X 53"H (2 -PANELS) (1) ROUGH SIZE = 120"W X 53"H (2 -PANELS) (1) ROUGH SIZE = 36"W X 84"H (1 -PANEL W/ (1) HORIZONTAL) 1" CLEAR INSULATED GLASS W/ LOW -E INSTALLED IN MONTICELLO, MN. FOR THE SUM OF............................................................$16,450.00 Continued... Store Copy vers: 9.2.10 Page: 1 401 EAST SIDE GLASS 305 Franklin Ave NE St. Cloud, MN 56304 Phone: (320)251-1900 Fax: (320)251-9471 -,,v N-triv. eastsideglass-mn. com Customer BLISS SALON, LLC 109 WALNUT ST MONTICELLO MN 55362 Quote: 60735 Date:01/30/2024 CsrANDY F Tech: PO BLISS SALON TermsC.O.D ***PRICED INSTALLED INTO FULLY PREPARED OPENINGS BY OTHERS.*** ***EXCLUDES REMOVAL AND DISPOSAL OF THE EXISITNG WINDOWS/ENTRY.*** ***ROUGH OPENINGS MUST BE GUARANTEED BEFORE INSTALL.*** ***EXCLUDES ANY FINISHING WORK OTHER THAN CAULKING.*** ***EXCLUDES FINAL CLEANING OF GLASS AND ALUMINUM.*** ***PRICE MAY DEPEND ON TIMING OF APPROVAL.*** ***ESG REQUIRES A MINIMUM 1/2 DOWN PAYMENT TO ORDER MATERIALS.*** Job Site: BLISS SALON - MONTICELLO FRONT OF BUILDING (4) NEW EXTERIOR STATIONARY WINDOWS (1) NEW EXTERIOR ENTRY Thank you for the opportunity to quote. Quote Valid For 30 Days. Signature Date Store Copy vers: 9.2.10 Page: 2 .'�4 EA -S- T SIDE GLASS 305 Franldin Ave NE St. Cloud, MN 56304 Phone: (320)251-1900 Fat: (320)251-9471 w-vinv.eastsideglass-mn.com Customer BLISS SALON, LLC 109 WALNUT ST MONTICELLO MN 55362 CsrANDY F Tech: Quote: 60736 Date:01/30/2024 F -6v o � Wj� PO BLISS SALON TermsC.O.D Qyt Part / Description 1 COMMERCIAL - PROJECT AS QUOTED FURNISH AND INSTALL (1) NEW EXTERIOR OPERABLE COMMERCIAL ALUMINUM WINDOW AND (4) NEW EXTERIOR STATIONARY COMMERCIAL ALUMINUM WINDOWS. STATIONARY WINDOWS INCLUDE: (DARK BRONZE ANODIZED FINISH) FRAMING = 2" X 4-1/2" (3) ROUGH SIZE = 101"W X 53"H (2 -PANELS) (1) ROUGH SIZE = 120"W X 53"H (2 -PANELS) 1" CLEAR INSULATED GLASS W/ LOW -E OPERABLE WINDOW INCLUDES: (DARK BRONZE ANODIZED FINISH) HORIZONTAL SLIDING COMMERCIAL ALUMINUM WINDOW FRAMING DEPTH = 3-1/4" ROUGH SIZE = 101 "W X 53"H (2) STATIONARY MIDDLE PANELS (2) SLIDING END PANELS STANDARD LOCKING STANDARD SCREENS 1" CLEAR INSULATED GLASS W/ LOW -E INSTALLED IN MONTICELLO, MN. FOR THE SUM OF............................................................$18,650.00 ***PRICED INSTALLED INTO FULLY PREPARED OPENINGS BY OTHERS.*** ***EXCLUDES REMOVAL AND DISPOSAL OF THE EXISITNG WINDOWS.*** ***ROUGH OPENINGS MUST BE GUARANTEED BEFORE INSTALL.*** ***EXCLUDES ANY FINISHING WORK OTHER THAN CAULKING.*** Continued... Store Copy vers: 9.2.10 Page: 1 .'�4"" EAST SIDE GLASS 4" 305 Franklin Ave NE Tl St. Cloud, MN 56304 Phone: (320)251-1900 Fax: (320)251-9471 NvNivi -.eastsideglass-mn.com Customer BLISS SALON, LLC 109 WALNUT ST MONTICELLO MN 55362 Quote: 60736 Date:01/30/2024 CsrANDY F Tech: PO BLISS SALON Terms1C.O.D ***EXCLUDES FINAL CLEANING OF GLASS AND ALUMINUM.*** ***PRICE MAY DEPEND ON TIMING OF APPROVAL.*** ***ESG REQUIRES A MINIMUM 1/2 DOWN PAYMENT TO ORDER MATERIALS.*** Job Site: BLISS SALON - MONTICELLO REST OF BUILDING (4) NEW EXTERIOR STATIONARY WINDOWS (1) NEW EXTERIOR OPERABLE WINDOW Thank you for the opportunity to quote. Quote Valid For 30 Days. Signature Date Store Copy vers:9.2.10 Page: 2 City of Monticello Permit Quote Quote Date: 2/5/2024 Permit Type: BUILDING Property Type: COMMERCIAL Construction Type: ALTERATION Description Fee BUILDING PERMIT FEE STATE SURCHARGE, BLDG VAL PLAN REVIEW 682.48 24.91 443.61 TOTAL 1,151.00 2/5/2024 Page 1 of 1 Sherburne rpt ik 14 - saal Estatp_ Fwaluatinn BLISS SALON LLC Expiration Date Coverage Location Type Main Store Main Phone Location Name 109 Walnut Sreet Main Fax #155010051110 — 2022 taxes are $2,780 — 1St half PAID, Property Type Owner Occupied RE Land Area (Acres) 0.13 Property Sub -Type Retail - Free Standing Building Area (SF) 2,000 Address 1 109 Walnut Sreet Appraisal Value ($) 200,000 Address 2 Last Appraisal Date 08/24/22 Parcel Number 155.010.051110 Sale Price ($) 185,000 City/Location Monticello Last Sale Date 02/10/17 State/Province Minnesota Number of Stories 1 County Wright Year Constructed 1950 ZIP/Postal Code 55362 Year Renovated Region Marketability Average Country USA Collateral Owner Occupied Commercial RE Address 109 Walnut Sreet Monticello, MN 55362 Census Tract 1002.03 Property Category Commercial Flood Zone Y/N NO Annual Taxes 2,780 Special Assessments 0 Number of Units 1 Taxable Value ($} 158,000 REAL ESTATE! Property Insurance Expiration Date Coverage Mortgagee 02.01.23 $451,507 AHNB Property Tax Info: (taxes #155010051110 — 2022 taxes are $2,780 — 1St half PAID, 2nd half due Oct 171h — AHNB Escrows current/escrowed Environment Questionnaire & 04.24.17 - Clean any Contamination? Site Visit: (date/inspector): 07.22.2022 — Adam Vee — No visible incomplete repairs or unfinished construction, in general, he subject is adequately maintained. Collateral Photo: Ile, , Legal Description: "Exhibit A" That part of Lots 11 and 12, Block 51, Townsite of Monticello according to plat on file and of record in the Office of the County Recorder, in and for the County of Wright, State of Minnesota, described as follows; Beginning at the Southeast corner of said Lot 11; thence on an assumed bearing of the North 64 degrees 05 minutes 32 seconds West along the Southwesterly line of said Lots 11 and 12 to a point distant 9.00 feet Northwesterly of the Southeast corner of said Lot 12; thence North 26 degrees 00 minutes 06 seconds East, parallel with the Southeasterly line of said Lot 12, 75.00 feet; thence South 64 degrees 05 minutes 26 seconds East, to a point on the Southeasterly line of said Lot 11 distant 75.00 feet Northerly of the Southeast corner of said Lot 11; thence South 26 degrees 00 minutes 00 seconds West along aid Southeasterly line 75.00 feet to the point of beginning. Commercial Real Estate Evaluation Borrower: Bliss Salon LLC, a Limited Liability Company under the laws of Minnesota Property Owner: Bliss Salon LLC, a Limited Liability Company under the laws of Minnesota Occupancy: Owner Occupied Intended Purpose: Refinance Report Data Source(s): Multiple Listinq Service (MLS), County Tax and Land Records, Real Estate Professionals Specific Zoning: CCD - Central Community District Extraordinary None Hypothetical Conditions: None PROPERTY INFORMATION: History of Ownership: Last Transfer according to County Records is a Warranty Deed dated February 10, 2017 and recorded 2020 February 15, 2017 as document number 1336858; whereas ARG Properties LLC, a Limited Liability Improvements: Company under the laws of Minnesota conveyed title to Bliss Salon LLC, a Limited Liability Company $107,600.00 under the laws of Minnesota Neighborhood Analysis: The Subject is located in the portion of the city of Monticello that is in Wright County. The neighborhood $ 44,400.00 area is considered to be bound on the North by The Mississippi River to the West by Linn Street, to the $ 44,400.00 South by West Broadway and to the East by Pine Street. The neighborhood is composed of primarily OTAL: Commercial and Residential properties. Building Description: The subject is a commercial retail and office building with a concrete block foundation, stucco exterior $144,200.00 walls and a new pitched roof as of 2022. Above grade consists of 1,600sgft with the interior consisting of hardwood floors and title in the styling rooms, office and kitchen/ breakroom. Below grade is a 400sgft finished living area with its own entry. There is one bedroom and one bathroom finished with tile and carpet. The building has forced air and heating with central cooling. Site Description: The Subject Property Site includes approximately 5,664 Square Feet or 0.13 Acres according to public records. The configuration of the site is basically rectangular (refer to maps and aerial photograph) and the topography of the site is relatively level. Landscaping consists of natural vegetation and bituminous parking/driveway areas. Public Improvements include paved roadway, sanitary/storm sewer and water. Utilities include electrical, telephone. Overall Condition of No Visible incomplete repairs or unfinished construction, in general, the conditions are average. Property: Tax Assed Value: 2022 2021 2020 2019 Improvements: $113,600.00 $107,600.00 $103,100.00 $ 99,800.00 Land: $ 44,400.00 $ 44,400.00 $ 44,400.00 $ 44,400.00 OTAL: $158,000.00 $152,000.00 $147,500.00 $144,200.00 NOTICE OF PUBLIC HEARING CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY WRIGHT COUNTY, MINNESOTA NOTICE IS HEREBY GIVEN that the Board of Commissioners of the City of Monticello Economic Development Authority (the "Authority") will hold a public hearing on Wednesday, February 14, 2024, at approximately 6:00 P.M. or as soon thereafter as the matter may be heard, in the Mississippi Room of the Monticello Community Center located at 505 Walnut Street in the City of Monticello, Minnesota (the "City"), to consider the provisions of a proposed business subsidy under Minnesota Statutes, Sections 116J.993 through 116J.995, as amended (the "Business Subsidy Law"), to Bliss Salon LLC, a Minnesota limited liability company (the "Recipient"), in connection with facade improvements to be made to the real property located at 109 Walnut Street in the City (the "Project"). Information about the proposed business subsidy to the Recipient is available for inspection at the office of the Authority's Executive Director at City Hall during regular business hours. After the public hearing the Authority will consider granting the business subsidy in accordance with the proposed terms and if the creation or retention of jobs is determined not to be a goal of the Project, the wage and job goals may be set at zero in accordance with the Business Subsidy Law. A person with residence in the City or the owner of taxable property in the City may file a written complaint with the Authority if the Authority fails to comply with the Business Subsidy Law, and no action may be filed against the Authority for the failure to comply unless a written complaint is filed. All interested persons may appear at the hearing and present their views on the matters orally or provide their comments prior to the meeting in writing. Dated: February 1, 2024 BY ORDER OF THE BOARD OF COMMISSIONERS OF THE CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY /s/ Jim Thares Executive Director MN325\40\926193.v 1 CITY OF MONTICELLO Schedule of Assets, Liabilities, Deferred Inflows of Resources, and Fund Balances Economic Development Authority & Small Cities Development Program December 31, 2023 - Unaudited TIF 6 (d) TIF 19 (d) TIF 20 (d) TIF 22 (d) TIF 24 TIF 29 TIF 30 TIF 34 (d) TIF 40 TIF 41 TIF 42 � 43 TIF 45 TIF 46 GAAP Total Total EDA General GMEF TIF Future Raindance MS Shores Prairie West Downtown St. Henry's Front Porch CMHP Interchange Briggs UMC Headwaters Headwaters Block 52 WiHa Reconciliation EDA SCDP ASSETS Cash and investments $ 2,114,264 $ 1,056,105 $ $ 49,450 $ 37,719 $ 104,142 $ 519,286 $ 55,800 $ 34,654 $ 80,227 $ 77,340 $ 13,478 $ 31,671 $ $ $ $ $ 4,174,136 $ 828,753 Receivables Unremitted taxes 753 - - - - - - - - - - - 753 - Delinquent taxes 1,722 2,687 4,409 Accounts 10,218 - - 10,218 Intrafund receivable 111,607 728,845 - (840,452) - Prepaid items 5,033 - . 5,033 - Notes receivable 127,246 191,541 - 318,787 110,748 Land held for resale 2,883,058 163,200 3,046,258 TOTAL ASSETS $ 5,253,901 $ 1,247,646 $ $ 778,295 $ 37,719 $ 104,142 $ 685,173 $ 55,800 $ 34,654 $ 80,22 7 $ 78 1,671 $ $ $ $ $ (840,452) $ 7,559,594 $ 939,501 LIABILITIES Accounts and contracts payable $ 16,639 $ $ $ $ $ $ $ $ $ $ $ - $ 127,246 $ $ $ $ 143,885 $ Intrafund payable - 45,363 4,644 728,845 400 400 400 400 (840,452) - Uneamed revenue - - 163,200 - - - - - - (163,200) - Escrow deposits 5,492 5,492 Total liabilities 22,131 45,363 163,200 644 728,845 400 127,646 400 400 (1,003,652) 149,377 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 1,7222 - - - - - - - - - - - - - 4,409 - FUND BALANCES Nonspendable 5,033 5,033 Restricted - 1,247,646 778,295 37,719 9,286 ,800 15,583 77,340 13,478 (697,174) (400) (127,646) (400) (400) 163,200 2,221,123 939,501 Assigned Economic Development 5,025,015 - (45,363) - - - - - - - - 4,979,652 - Fagade Grant 200,000 - - - - - - - - - - - - - - 200,000 - Total fund balance 5,230,048 1,247,646 45,3 778,295 37,71 104,142 5 55,800 34,654 15,583 77,340 13,478 (697,174) (400) (127,646) (400) (400) 163,200 7,405,808 939,501 TOTAL LIABILITIES, AND FUND BALANCES $ 5,253,901 $ 1,247,646 $ 778,295 $ 719 104,142 685,1 $ 55,800 $ 34,654 $ 80,227 $ 77,340 $ 13,478 $ 31,671 $ $ $ $ -L (840,452) $ 7,559,594 $ 939,501 Required or Actual Decertification Date 9/2013 12/3 2018 2/31/2023 12/31/2026 12/31/2029 12/31/2029 12/31/2022 1213112045 1213112031 12131/2050 12/31/2050 12131/2050 12/31/2032 TIF District Type elopment Ho Re ment Housing 8 Housing Housing Housing Redevelopment Housing Economic Housing Housing Redevelopment Economic (d) = decertified Redevelopment Development Development Schedule of Revenues, Expenditures and Other Financing Sources (Uses) Economic Development Authority & Small Cities Development Program For the Period Ended December 31, 2023 - Unaudited Revenues Property taxes Tax increments Intergovernmental Investment earnings Interest on loans Other revenues Total revenues Expenditures: Current Salary and wages Benefits Supplies Professional services - legal Professional services - other LPV Insurance Legal and general publications Marketing Dues and membership Utilities IT services Travel and conferences Other expenditures Excess increments Interest on intrafund loans PAYG payments to third parties Total expenditures Excess (deficiency) of revenues over expenditures Other financing uses Transfers in Net change in fund balances Fund balance at beginning of year Fund balance at end of yeas Required or Actual Decertification Date TIF District Type (d) = decertified 138,697 48,091 35 21,780 156,883 3,395 398 5,000 6,796 789 3,473 5,120 295,753 686,210 TIF 6 (d) TIF 19 (d) TIF 20 (d) TIF 22 (d) TIF 24 TIF 29 TIF 30 TIF 34 (d) TIF 40 TIF 41 TIF 42 EDA General GMEF TIF Future Raindance MS Shores Prairie West Downtown St. Henry's Front Porch CMHP Interchange Briggs UMC Headwaters (31,257) 3,481 3,344 3,300 (31,257) 1,449,767 41,292 $ 401,807 $ $ $ $ - $ $ - $ - $ - $ - $ $ - $ - $ - 37,749 269,641 55,830 34,684 17,576 70,020 65,098 284,123 - - - - - - - 206,458 1,963 3,481 29,294 3,300 897,651 3,481 29,294 37,749 269,641 55,830 34,684 17,576 70,020 65,09 138,697 48,091 35 21,780 156,883 3,395 398 5,000 6,796 789 3,473 5,120 295,753 686,210 Total 211,441 3,481 3,950 SCDP 215,391 3,481 5,014,657 1,244,165 (45,363) $ 5,230,048 $ 1,247,646 $ (45,363) Redevelopment CITY OF MONTICELLO IF 43 TIF 45 TIF 46 GAAP Total Total aters Block 52 WiHa Reconciliation EDA SCDP $ $ $ $ 401,807 $ 550,598 284,123 - 206,458 37,948 (31,257) 3,481 3,344 3,300 (31,257) 1,449,767 41,292 138,697 48,091 - 35 1,000 22,780 - 1,468 400 400 400 400 159,951 - - - - - - - 3,395 30 30 30 30 0 30 30 30 224 862 - - - - 5,000 6,796 789 3,473 5,120 295,753 0,20 - - 180,209 1,963 - 29,294 (31,257) - 63,018 63,018 3 1 9 30 1,993 30 63,048 30,986 400 400 400 400 (31,257) 933,969 ,719 (30) 88,4 55,800 34,654 15,583 (30) 6,972 34,112 (400) (400) (400) (400) 515,798 41,292 3,950 9 (30) 88,402 55,800 34,654 15,583 (30) 6,972 34,112 (400) (400) (400) (400) 519,748 41,292 104,172 430,884 - 77,370 6,506 (731,286) (127,246) - 163,200 6,886,060 898,209 7,719 $ 104,142 $ 519,286 $ 55,800 $ 34,654 $ 15,583 $ 77,340 $ 13,478 $ (697,174) $ (400) $ (127,646) $ (400) $ (400) $ 163,200 $ 7,405,808 $ 939,501 12/31/2023 12/10/2018 12/31/2023 12/31/2026 12/31/2029 12/31/2029 12/31/2022 12/31/2045 12/3112030 12/31/2050 12/31/2050 12/31/2050 12/31/2032 Housing Redevelopment Housing 8 Housing Housing Housing Redevelopment Housing Economic Housing Housing Redevelopment Economic Redevelopment Development Development EDA Agenda: 02/14/2024 6A. Consideration to approve a proposal from AE2S in the amount of $16,874 for preparation of housing and economic development resources. Prepared by: Meeting Date: ® Regular Agenda Item Community Development Director 02/14/2024 ❑ Consent Agenda Item Reviewed by: Approved by: Economic Development Manager City Administrator ACTION REQUESTED Motion to approve a proposal from AE2S in the amount of $16,874 for preparation of housing and economic development resources. REFERENCE AND BACKGROUND The EDA is asked to approve preparation of marketing and communication materials in support of efforts to develop its commercial, industrial and downtown land holdings, as well as support investment in housing and residential quality -of -life initiatives. In 2022, the EDA and City worked with AE2S to prepare an Integrated Marketing and Communications Plan (IMCP). The plan identifies strategies to assist Monticello in its transition from an energy -based economy through tax base and employment expansion, redevelopment and reinvestment, and quality of life enhancements. With the completion of the original IMCP, the City and EDA received an initial set of communication tools, the majority of which are in current use. Staff reviewed the IMCP strategies and have identified a set of additional communication tools that are needed. These tools were specifically identified based on a prioritization of the IMCP for consistency with the Monticello 2040 Vision + Plan and alignment with the EDA's current priorities for land sale and development. These tools include: • Preparation of a one-page overview of Monticello — industrial development focus (digital compatible) • Preparation of a one-page overview — commercial development focus (digital compatible) • Preparation of one-page summaries for 6 EDA priority development properties, including companion web and social media content: o Great River Addition (West 7th Street commercial property) o Otter Creek Addition (West Chelsea industrial sites) o Cedar Street site EDA Agenda: 02/14/2024 o Block 34 site • Preparation of new resident/"Welcome to Monticello" housing packet, including companion web and social media content AE2S has provided a proposal for completion of those tools. As the developer of the IMCP, AE2S is providing a professional service based on their familiarity with the community and their access to established branding. If the EDA decides to pursue preparation of a market or trade area analysis for commercial/retail development, AE2S will incorporate the highlighted findings into prepared materials. The noted items are baseline information materials that will assist City staff in responding to prospects quickly and with positive and accurate initial information on Monticello sites. Budget Impact: The EDA's 2024 budget includes a line item for Marketing at $45,000. The proposed expenditure can be accommodated within the current budget and allow the EDA to consider other marketing -related expenditures for the year. II. Staff Workload Impact: The Community Development Director, Economic Development Manger and Communications and Marketing Specilaist will be involved in the editing of prepared materials. The preparation of these tools will streamline our initial prospect response. III. Comprehensive Plan Impact: The Monticello 2040 Vision + Plan includes specific strategies for promotion of the communities' assets, including "Develop partnerships to assist with marketing and promotion of industrial/ business park areas", "Develop and implement marketing of city -owned properties identified for redevelopment, including Block 52, 34 and Cedar Street/Broadway site", and "Identify specific underperforming or undervalued properties and locations to foster reinvestment and work with the property owners to achieve positive results ..." The 2040 Plan also encourages the community to foster a sense of place, encouraging residents to stay in the community and building a sense of belonging for those who choose to make Monticello home. STAFF RECOMMENDATION Staff recommend approval of the AE2S proposal. SUPPORTING DATA: A. AE2S Proposal B. EDA Workshop Presentation, January BACKGROUND The City of Monticello previously worked with AE2S Communications to complete an Economic Development Integrated Marketing and Communication Plan (IMCP). Based on the suggested actions of the plan, the City's Comprehensive Plan, and current development target areas, the City desires to develop templates and materials that focus on their highest priorities. SCOPE AND FEE The scope and fee presented below is based on the information provided in the background and the team's knowledge gained through completing the IMPC. The City would like marketing materials developed for three primary areas including: 1) industrial and commercial real estate; 2) six high priority sites; and 3) new resident packet. Separately, the City will also pursue a market trade analysis that will assist in developing additional target data. The team understands that deliverables are expected to be completed by late July or early August, 2024. Budget Budget General Total AE2S Hours Labor Costs Expenses Fee Budgeted Budgeted Task 3: New Resident Pack 4.1 Review current content and develop new content Nicole Jacob Marty Doll Gaustad Scully Senior Graphic Graphic Comms Designer Designer Strategist 2,110 4.3 Materials/one pager Budget Budget General Total AE2S Hours Labor Costs Expenses Fee Budgeted Budgeted Task 3: New Resident Pack 4.1 Review current content and develop new content IIIIIIIIIIIIIIIIII11pr 5 4 9 $ 1,674 $ 1,674 4.2 Packet folder design 1 4 12 17 $ 2,110 $ 2,110 4.3 Materials/one pager 2 4 8 14 $ 1,892 $ 1,892 4.4 Digital content and designs for web and social 1 4 6 11 $ 1,456 $ 1,456 TOTAL FOR TASK 4 51 $ 7,132 $ $ 7,132 Provided by AE2S Communications I February 6, 2024 O • AE2S COMMUNICATIONS 00- _ AP4'FjohS PR s: x — `�;- ifr� L CITY OF Monticello Integrated Marketing & Communications Plan (IMCP) • Adopted in 2022 • Focus Areas • Employee Recruitment & Retention 2040: Workforce Development • Executive Leadership Position Recruitment /-04u: Workforce Development • Manufacturer Retention Recruitment & Attraction 2040: Business Attraction & Retention 2040: Tax Base Diversification • Redevelopment & Revitalization -040: Redevelopment & Reinvestment 2040: Tax Base Diversification 2040: Opportunity Focus Areas • Relationship Building 2040: Partnerships I i, i M s/ 1-* a. *4 f%a 194A. �; CITY OF Monticello 1, MW Y �'• r `-'•tea... .:. _ - ."� CITY OF Monticello Staff Focus: Relationship Building Deployment Consultant Focus: Analysis Material Preparation Deployment Employee & Leaderships Recruitment & Retention • Build: • Develop connection between schools and businesses • Local internships • Alumni success in local business • Student participation (IEDC, Manufacturers Breakfast, etc) • Develop connection between City and employers, prospective employees • Engage employers on resources and info needed • Engage new residents on info needed • Develop and Deploy: • New Resident packet • Companion website updates • City and Chamber media platforms • Circle information back to schools, businesses Business Retention & Recruitment - C_ Build: Develop and Deploy: • CEO Networking Update Monticello community "Why • Testimonials Monticello" wrap template: • Shared media and outreach opportunities • Customize for manufacturing and • Re -affirm employee recruitment commercial • Community profile • Re -organize incentives pages on the website • Incentives Expansion testimonials Site-specific information one -pager for priority properties • Companion website build -out • Realtor and broker distribution DEED coordination Redevelopment, Reinvestment & Revitalization • Build: • Economic Development roundtable • Developers • Realtors • Lenders • Builders • Site specific one -pager for priority properties • • Develop and Deploy: Realtor/broker packets r • Companion website updates • Social media bursts �- Market & Trade Area Analysis • Scope • Trade Area/Secondary Trade Area Retail/Commercial Business Mix • Characteristics Population/Density Income Discretionary Spending/Spending Power • Retail Potential & Recommendations Expected Outcome: Updated data to be used in each of the prior focus area strategies, focused on effective marketing for Opportunity Areas CITY OF Monticello Marketing Design & Deployment Services "Why Monticello" Wrap(s) • Industrial/Manufacturing — Update Internally • Commercial/Broker - New New Resident General Info - New Employee Recruitment One -Pager New and Social Media Push Priority Site One Pager - New • Th Street West • Block 34 • Cedar Street * All with companion digital images for website EDA Agenda: 2/14/2024 7A. Economic Development Manager's Report Prepared by: Meeting Date: ❑x Other Business Economic Development Manager 2/09/2024 Reviewed by: Approved by: N/A N/A REFERENCE AND BACKGROUND 1. Thank you letter for 2024 funding contributions to the Initiative Foundation Community and Economic Development programs - See Exhibit A. 2. Guided Commercial Properties Map — See Exhibit B. 3. Guided Industrial Properties Map — See Exhibit C. 4. Projects Update - See Exhibit D. 5. Prospect List Update - See Exhibit E. (320) 632-9255 405 First Street SE Little Falls, MN 56345 ifound.org January 17, 2024 Jim Thares, Economic Development Manager City of Monticello 505 Walnut St, Stet Monticello, MN 55362-8822 Dear Jim, We have received the city of Monticello's 2024 funding to support the work of the Initiative Foundation in Central Minnesota. Please extend our appreciation to your EDA board, city council and mayor. Thank you! Together, we work to build strong local economies and vibrant communities. Your investment supports economic development through business financing activities designed to create living -wage jobs, diversify economies and leverage private sector investment. Communities are strengthened through signature leadership training and capacity building programs, grants to local units of government and nonprofit organizations, early childhood initiatives and scholarships. This work will provide lasting impact on the health of the region and the future of rural Minnesota. We truly value your partnership and your support. Sincerely, Brian Voerding President C� Carl Newbanks Director of Development CC: Rachel Leonard, City Administrator 93 Powering Possible Equal opportunity lender, provider and employer. Vacant Properties & Properties for Sale community.development@ci.monticello.mn.us 1763.295.2711 I Guided Commercial Updated January 2024 --.-VCITY OF Monticello 1 155-247-001020 Ryan Buffalo Land Company LLC 4.94 $57,412 B-3 2 155-125-000070 Ocello LLC 12.96 $6,834 B-3 3 155-151-003010 Bradley & Sharon Larson 1.78 $2,984 B-4 4 155-157-001010 Steven & Deborah Muth 1.55 $6,970 B-4 5 155-174-001010 Steven & Deborah Muth 0.9 $5,152 B-4 6 155-151-004010 Legacy Christian Academy 0.57 $2,900 B-4 7 155-189-001010 Steven & Deborah Muth 2.99 $18,218 B-4 8 155-260-001020 Vikram Aggarwal 2.01 $4,032 B-4 9 155-260-001010 Vikram Aggarwal 2.57 $4,458 B-4 10 155-164-000030 City of Monticello 7.02 $0 B-4 11 155-164-000040 City of Monticello 6.14 $0 B-4 12 155-269-000010 Ocello LLC 20.82 $11,024 PCD 13 155-227-000010 Ocello LLC 9.61 $7,446 PCD 14 155-230-000010 City of Monticello 35.69 $27,112 PCD 15 155-500-142303 City of Monticello 2.98 $0 PCD 16 155-500-142300 City of Monticello 3.75 $0 PCD 17 155-278-001010 Deephaven Development 1.66 TBD PCD 18 155-278-001030 Deephaven Development 2.21 TBD PCD 19 155-278-001040 Deephaven Development 1.4 TBD PCD 20 155-079-001010 Jyoti R Patel 0.79 $1,932 B-3 21 155-029-002050 Bravera Bank 2.75 $5,198 IBC 22 155-226-000020 City of Monticello EDA 14.17 $47,456 B-3 23 155-241-002010 Venturian Holdings LLC Etal 2.39 $17,106 PUD 24 155-241-000010 Venturian Holdings LLC Etal 2.34 $16,814 PUD 25 155-011-000101 Monticello Industrial Park Inc 4.76 $3,634 IBC 26 155-011-000111 Monticello Industrial Park Inc 7.76 $6,752 IBC 27 155-011-000171 Monticello Industrial Park Inc 10.5 $9,584 IBC 28 155-011-000171 Monticello Industrial Park Inc 17.8 $16,246 B-2 29 155-215-002010 Church of St Henry of Monti MN 2.04 $0 B-4 30 155-212-001020 McDonald's USA LLC 1.22 $25,080 B-4 31 155-212-001030 RGC-Monticello MN LLC 1.1 $10,326 B-4 32 155-178-002030 RGC-Monticello MN LLC 1.27 $13,380 B-4 33 155-229-001020 RGC-Monticello MN LLC 0.66 $6,380 B-4 34 155-011-000010 Steven G. & Thomas E. Hoglund 3.16 $5,274 B-2 35 155-037-001010 Kean of Monticello Inc 1.92 $6,966 B-2 36 155-037-001030 Deborah Dahlheimer Rev Trust 0.39 $1,878 B-2 37 155-205-001020 RGC-Monticello MN LLC 0.93 $9,402 B-4 38 155-214-001010 PRC Acquisitions VI LLC 1.01 $3,714 B-4 39 155-214-001020 PRC Acquisitions VI LLC 2.38 $4,970 B-4 40 155-117-001030 Kwik Trip Inc 2.23 $12,632 B-2 41 155-257-001010 Mivva LLC 0.99 $1,534 B-2 42 155-271-000030 Gold Nugget Dev. Inc 88.97 $14,032 IBC Properties for Sale I Guided Industrial community.development@ci.monticello.mn.us 1763.295.2711 Updated January 2024 --.-VCITY OF Monticello 1 155-273-001010 City of Monticello 9.764 $0.00 1-1 2 155-273-001020 City of Monticello 6.19 $0.00 1-1 3 155-194-000020 City of Monticello 6.67 $0.00 1-1 4 155-274-001010 City of Monticello 7.94 $0.00 1-1 5 155-274-002010 City of Monticello 10.384 $0.00 1-1 6 155-274-002020 City of Monticello 8.886 $0.00 1-1 7 155-274-003010 City of Monticello 6.28 $0.00 1-1 8 155-248-001030 J X Bowers LLC 8.02 $336 IBC 9 155-248-001020 J X Bowers LLC 4.98 $232 IBC 10 155-271-000030 Gold Nugget Development Inc 88.97 $14,032 IBC 11 155-029-002050 Bravera Bank 2.75 $5,198 IBC 12 155-255-001010 Spaeth Development LLC 0.53 $3,466 1-2 13 155-255-001030 Spaeth Development LLC 0.47 $3,200 1-2 14 155-011-000101 Monticello Industrial Park Inc 4.31 $3,634 IBC 15 155-011-000111 Monticello Industrial Park Inc 7.76 $6,752 IBC 16 155-011-000171 Monticello Industrial Park Inc 10.5 $9,584 IBC 17 155-500-042400 Praise Acres LLC 6.48 $4,396 1-2 IEDC Agenda: 02/14/24 7A. Proiect Update Block 52 Mixed Use Commercial -Residential Redevelopment: A Certificate of Occupancy was issued for the building on February 1, 2024. Residents have started moving into apartments on the upper floors (4-5). Punch list items still need to be completed in the building. Build of 11,000 square feet of office space for a financial services -products (insurance and investments) firm with 102 FTE employees is expected to begin in February 2024. Discussions are continuing with prospective restaurants and other commercial tenants. A total of 45 new FTE jobs will be required to be created by the new businesses that occupy the building. A tour of the building is planned for late February 2024. Staff will keep the EDA updated on the date and time of the tour. Headwaters Apartments: Staff is waiting for Headwaters Development to submit TIF Modification paperwork for their proposed PUD amendment of the 102 -unit apartment building (ages 55 +) site. Headwaters plans to replace the apartment building with 22 new twin homes at this site. This change is significant and will require a modification to the TIF District as well. EDA and PC and City Council approvals will be needed for the proposed changes, which may take several months in early 2024. Monticello Lakes — Savanna Vista Apartments: Construction of a two building, 200 -unit apartment development at a parcel on the west side of Edmunson Ave NE in the Pointes At Cedar (PAC) Master Plan Planned Community District is in rapidly progressing. This is a market rate housing development. The PAC water amenity features and proximity to restaurants and shopping are expected to be a strong leasing draw for this development. Wiha Tools Warehouse Facility Development: Construction of Wiha Tools' new 74,000 square foot assembly and warehouse facility development also continues with completion expected in mid-February. The new 75,000 sq. ft. facility will house Wiha Tools' assembly, warehouse, distribution, sales, and administrative functions. Wiha received $880,000 in funding assistance from the MIF and JCF programs for IEDC Agenda: 02/14/24 equipment and building (MN -DEED) as well as City -EDA TIF assistance to offset land acquisition and site prep costs. Under the Business Subsidy component of the TIF Development Agreement, Wiha is required to create 59 FTE new jobs over the next 5 years. A second phase expansion of 79,000 sq. ft. is projected to occur in about 2028 or 2029. An additional 21 FTE jobs are expected to be created in Phase 2, increasing the total local workforce to approximately 142 +/-. Date of Contact /22/201 /29/20 128/201 /9/201' t16/203 (20/202 30-22 2/16/2021 3/19/2021 2/28/2022 6/16/2021 6/30/2021 7/29/2021 10/28/2021 2/7/2022 Company Name Business Category Project Description IL Karlsburger Foods Food Products Mfg. Facilty Expansion Project Blitzen Precision Machining Exist Bldg or New Const. Project Nutt Co -Working Space Existing Building Project FSJP Light Mfg -Res. Lab New Construction Project Jaguar Office New Construction Project Panda v3 Service -Child Care New Construction Project TDBBST Industrial New Construction Project Cold Industrial -Warehouse -Di New Construction stri Project Orion Warehouse-Distributi New Construction on Project Emma II Light Ind -Assembly New Construction Project UBAA Child Care Services New Construction or Exist Project Ecosphere Industrial Tech Mfg. New Construction Project BA710 Lt Assem-Distribute IProject Stallion Technology Service Project Shepherd Lt Assembly Distribution III 02/09/2024 0 9 $1,850,000 Concept Stage Building -Facility i Retained lobs New lobs Total Investment Project Status 80,000 sq. ft. 0 21 $12,000,000 20,000 sq. ft. +/- 42 10 to $4,500,000 On Hold Active Search 20,000 sq. ff. 20 4 $1,350,000 12,000 sq. ft. 5,000 sq. ft. 10 $1,200,000 Concept Stage ? ? ? ? Concept Stage 20,000 sq. ft. 0 20+/- $1,400,000 Active Search 22,000 sq. ft. 22 4 $2,700,000 Active Search 10,500 sq. ft. 0 21 $4,100,000 Active Search 10,000 to 15,000 sq. 0 9 $1,850,000 Concept Stage ft. 80,000 sq. ft. 0 21 $12,000,000 Concept Stage 832,500 sq. ft. 0 500 $125,000,000 Active Search 20,000 sq. ff. 0 4 $1,350,000 Active Search 5,000 sq. ft. 0 14 to 19 $2,000,000 Act Search 1,000,000 sq. ft. 0 1122 $85,000,000 Act Search New Construction 6,500 to 7,000 sq. ft 0 10 New Construction 42,000 sq. ft. 40 New Construction 75,000 sq. ft. 75 $650,000 Active Search $3,600,000 Active Search $10,500,000 Active Search PROSPECT LIST 02/09/2024 Date of Contact Company Name Business Category Project Description Building -Facility Retained lobs New lobs Total Investment Project Status 4/28/2022 Project Cougar Precision Machining -Mfg. New Construction 35,000 to 45,000 sq. ft. 38 $4,700,000 Active Search 8/11/2022 Project Sing Precision Machining New Construction 400,000 sq. ft. 0 500 $90,000,000 Active Search 10/28/2022 Project IAG Mfg. New Construction 300,000 sq. ft.? 0 50? $70 to $80,000,000 Active Search 11/9/2022 Project Tea Mfg New Construction 25,000 sq. ft. 55 20 $5,800,000 Active Search 12/13/2022 Project Love Mfg New Construction 250,000 130 $24,000,000 Active Search 4/20/2023 Project Lodge DH1 Lodging -Service New Construction ? ? ? $9,500,000 to $12,500,000 Active Search 4/20/2023 Project Lodge RS2 Lodging Service New Construction ? ? ? $9,500,000 to $12,500,000 Active Search 4/26/2023 Project Lodge DC3 Lodging Service New Construction ? ? ? $9,500,000 to $12,500,000 Active Search 5/30/2023 Project Flower -M &M Commercial Concept Expansion ? ? ? ? Concept 6/9/2023 Project Pez low_ New Construction 6,000 to 8,500 sq. ft. 12 2 $1.300,000 Active Search 7/1/2023 Project V Mfg New Construction 150,000+sq. ft. ? $16,000,000 Active Search 8/16/2023 Project Lodge RT4 Lodging-Hopsitality New Construction ? N/A ? $11,500,000 to $14,500,000 Active Search 8/31/2023 Project Enclave- W300 Industrial - Warehouse- Distr New Construction 300,000 sq. ft. N/A ? $30,000,000 to $34,000,000 Active Search PROSPECT LIST 02/09/2024 Date of Contact Company Name Business Category Project Description Building-Facility Retained lobs New lobs Total Investment Project Status 9/19/2023 Project Panda #4 SZ Childcare Facility New Construction ? N/A ? $2,000,000 +/- Active Search 10/12/2023 Project Fun Entertainment Expansion 2,400 sq. ft. N/A 4 $200,000 Concept 1/17/2024 Project Tex Industrial New Construction 500,000 sq. ft. 0 100 $500,000,000 Active Search 1/17/2024 Project G Industrial New Construction 1,000,000 sq. ft. 0 ? $120,000,000 Focused Search Contacts: M = 08 YTD = 08