The URL can be used to link to this page

Home My WebLink AboutEDA AGN 05-14-07 Special 590 40th Avenue N.E" Columbia Heights, MN 55421-3878 (763) 706-3600 TOO (763) 706-3692 Visit Our Website at: www.ci.columbia-heights.mn.us EDA COMMISSIONERS Don Murzyn JI'. Patricia Jindra llruce Kclzcnberg Gury L. Peterson Bruce Nawrocki 130bby Willimlls TammcraDiehm CITY OF COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY SPECIAL MEETING 6:30 P.M., MONDAY, MAY 14, 2007 CITY HALL, CONFERENCE ROOM 1 AGENDA 1. CALL TO ORDER/ROLL CALL 2. PLEDGE OF ALLEGIANCE 3. DISCUSSION ITEM A. Adopt Resolution 2007-10, Contract for Private Redevelopment Motion: Move to Adopt Resolution 2007-10, a Resolution Approving a Contract for Private Redevelopment between the Columbia Heights Economic Development Authority and the Greater Metropolitan Housing Corporation; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. 4. ADJOURNMENT Walter R. Fehst, Executive Director The EDA does not discriminate on the basis of disability in the admission or access to, or treatment or employment in, its accommodation will be provided to allow individuals with disabilities to participate in all EDA services, programs, and activities. Auxiliary aids for handicapped persons arc available upon request when the request is made at least 96 hours in advance. Please call the Deputy City Clerk at (763) 706-3611 to make arrangements (TDD 706-3692) for deaf or hearing impaired only. H:\EDAAgenda2007\May 14, 2007 Special THE CITY OF COLUMBIA HEIGHTS DOES NOT DISCRIMINATE ON THE BASIS OF DISABILITY IN EMPLOYMENT OR THE PROVISION OF SERVICES EQUAL OPPORTUNITY EMPLOYER COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) Meeting of May 14, 2007 AGENDA SECTION: Business Items ORIGINATING DEPARTMENT: EDA EXECUTIVE NO.3 DIRECTOR APPROVAL ITEM: Adopt Resolution 2007-10, BY: Robert Streetar BY: Approving a Contract for Private DATE: May 8, 2007 Redevelopment The purpose of this memorandum to ask Commissioners to consider redeveloping the residential property located at 4141 Jefferson Street, in partnership with Greater Metropolitan Housing Corporation (GMHC), from its current state as a vacant and burned out single-family home to two new single-family for-sale homes. Property Background The home, which was built in 1924, was subject to a fire on August 17, 2005. It has remained in a burned out state since that time. The lot measures 80' x 129' and is comprised of two legally conforming single-family lots, with the existing house occupying the north lot. Please find attached photos of the lot and structure. The property was recently foreclosed and placed for sale for $120,000 by the owner, AMC Mortgages Services. The land and improvements are assessed at $152,700, and the just land is assessed at $91,600 for pay 2008. After extensive discussions the owner has agreed to reduce the sale price to the EDA to $86,000, which is $5,600 or 6.1 % lower than the County's assessed land value. Redevelopment Project The GMHC would demolish the existing home and build two new single-family for-sale homes. Each home would be two-stories, and 1,650 square feet in size, with three bedrooms and two and one half bathrooms, and similar to those the GMHC built on Second Street in 2004. Both of these homes would sell for a target price of $235,000. Demolition would tentatively begin in June, with construction occurring over the next 90 to 120 days. Marketing would begin simultaneously with demolition. The table provides a quick look at the results of redeveloping this property. # Of Single - Family Homes Property Value Property Tax 'Approximate Before 1 $157,700 $1,544 After 2 *$470,000 *$4,752 Chanqe 1 *$317,300 *$3,208 The cost to acquire the property, demolish the existing structure, and construct two new homes is estimated to be $535,050. The sale of both homes would generate $470,000 of revenue. Subsequently, in order to successfully redevelop the property, the project requires $65,050 of funding assistance to make the project feasible. The assistance could come from Fund 226 - Special Projects that currently has a balance of just over a $100,000. 1 Comprehensive Plan By facilitating the redevelopment of this property, the EDA would be implementing two goals of the Housing component of the Comprehensive Plan. These goals and their corresponding action steps are listed below. Goal: Promote and preserve the single-family housing stock as the community's strongest asset. . Action Step: The City will acquire and demolish the most seriously deteriorated single-family homes and work with the private sector to develop appropriate replacement housing. . Action Step: The City will acquire and assemble residential lots, as opportunities arise, for the purpose of developing infill housing. Goal: Provide a variety of life cycle housing opportunities within the community. . Action Step: The City will foster partnerships with the private sector to help diversify housing in the community. Development Contract To redevelop this property the EDA would need to approve a development contract with the GMHC. The contract stipulates that the EDA will assign the purchase agreement, between the EDA and AMC Mortgage Services, to the GMHC on or before the day of closing estimated to be no later than May 25, 2007. The GMHC will purchase the property from AMC Mortgage Services for $86,000. GMHC will demolish the current structure and build two new single-family for sale homes and sell them each for a target price of $235,000. Once construction is completed the EDA will provide up to $65,050 of funding assistance. Summary In summary, the EDA is presented with an opportunity to remove a vacant and blighted home and replace it with two new single-family for-sale homes with target sales prices of $235,000. To accomplish this task the City would partner with the GMHC as the homebuilder as well as provide financial assistance to the GMHC to make this redevelopment feasible. This redevelopment would implement the goals of the Comprehensive Plan and result in a much-needed physical improvement to the neighborhood. Please find attached a copy of the development agreement. Recommendation Staff recommends the EDA approve the contract for private redevelopment between the EDA and the Greater Metropolitan Housing Corporation. Recommended Motion Move to approve Resolution 2007-10, a Resolution approving a Contract for Private Redevelopment between the Columbia Heights Economic Development Authority and the Greater Metropolitan Housing Corporation; and furthermore, to authorize the President and the Executive Director to enter into an agreement for the same. 2 Attachments EDA ACTION: 3 COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. 2007-10 RESOLUTION APPROVING REDEVELOPMENT BETWEEN DEVELOPMENT AUTHORITY HOUSING CORPORATION A CONTRACT FOR PRIVATE THE COLUMBIA HEIGHTS ECONOMIC AND GREATER METROPOLITAN BE IT RESOLVED By the Board of Commissioners ("Board") of the Columbia Heights Economic Development Authority ("Authority") as follows: Section I. Recitals. 1.01. The Authority has determined a need to exercise the powers of a housing and redevelopment authority, pursuant to Minnesota Statutes, Sections. 469.090 to 469.108 ("EDA Act"), and is currently administering the Downtown CBD Redevelopment Project ("Redevelopment Project") pursuant to Minnesota Statutes, Sections 469.001 to 469.047 ("HRA Act"). 1.02. The Authority and the Greater Metropolitan I-lousing Corporation (the "Redeveloper") have proposed to enter into a Contract for Private Redevelopment (the "Contract"), setting forth the terms and conditions of redevelopment of certain property within the Redevelopment Project located at 4141 JelIerson Strcet (the "Redevelopment Property"). 1.03. Pursuant to the Contract, the Redeveloper will be assigned that certain Purchase Agreement between the Authority and AMC Mortgage Services, for the sale of 4141 Jefferson Street (the "Redevelopment Property"). Pursuant to the Contract, the Redeveloper will purchase the Redevelopment Property, divide the property into two lots and construct two single-lamily homes with a target price of $235,000 each. 1.04. The activities of the Authority under the Contract implement housing goals and action steps of the City's Comprehensive Plan: "Promote and preserve the single-lamily housing stock as the community's strongest asset by acquiring and demolishing the most seriously deteriorated single-family homes and work with the privatc sector to develop appropriate replacement housing, and by acquiring and assembling residential lots, as opportunities arise, for the purpose of developing infilllots." and "Provide a variety of life-cycle housing opportunities within the community, by lostering partnerships with the private scctor to help diversiJy housing in the community." 1.05. The Board has reviewed the Contract and finds that the execution thereof and performance of the Authority's obligations thereunder further the goals of the Comprehensive Plan and are in the best interests of the City and its residents. Section 2. Authoritv Approval: FlIliher Proceedings. 2.01. The Contract as presented to the Board is hereby in all respects approved, subject to modifications that do not alter the substance of the transaction and that are approved by the 310837vl MTN CL205.41 President and Executive Director, provided that execution of the documents by such officials shall be conclusive evidence of approval. 2.02. The President and Executive Director are hereby authorized to execute on behalf of the Authority the Contract and any documents referenced therein requiring execution by the Authority, and to carry out, on behalf of the Authority its obligations thereunder. 2.03. Authority and City staff are authorized and directed to take all actions to implement the Contract. Approved by the Board of Commissioners of the Columbia Heights Economic Development Authority this 14th day of May 2007. President- Gary 1. Peterson ATTEST: Executive Director- Walter R. Fehst 310837v1 MTN CL20j.41 2 t ul ~ ~ o VI l- It lli h 2(;1- - ::r - -:r- FRoNt ~\-J' '.'JY ,;.,\~' tf~~f:.{';/t; ~',i:.(..";,};:; :1f'i;~~~: :::'~'~ '~~:.: v;';. 'I., Coft-R46f. EXECUTION COPY CONTRACT FOR PRIVATE REDEVELOPMENT By and Between COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY COLUMBIA HEIGHTS, MINNESOTA and GREATER METROPOLITAN HOUSING CORPORATION Dated as of: May 14,2007 This document was drafted by: KENNEDY & GRAVEN, Chartered (MTN) 470 US Bank Plaza 200 South Sixth Street Minneapolis, Minnesota 55402 Telephone: (612) 337-9300 31085Sv2 MTN CL20S-41 PREAMBLE Section 1.1. Section 2.1. Section 2.2. Section 3.1. Section 3.2. Section 3.3 Section 3.4 Section 3.5 Section 3.6. Section 3.7. Section 3.8. Section 3.9. Section 4.1. Section 4.2. Section 4.3. Section 4.4. Section 5.1. Section 5.2. Section 5.3. 310855v2 MTN CL205-41 TABLE OF CONTENTS ............................................................................................................................1 ARTICLE I Definitions Definitions......................................................................................................... .2 ARTICLE II Representations and Warranties Representations by the Authority.......................................................................4 Representations and Warranties by the Redeveloper.........................................4 ARTICLE III Acquisition and Conveyance ofPropelty Status of Redevelopment Property.....................................................................6 Terms .... ............................................................ ........................... ...... ......... .......6 Authority Assistance..........................................................................................6 Title.......................................................................................7 Place of Document Execution............................................................................ 7 Business Subsidy............................................................................................... 7 Environmental Conditions................................................................................. 7 Look-Back Participation....................................................................................8 Records .............................................................................................................. 9 ARTICLE IV Construction of Minimum Improvements and Public Improvements Construction of Minimum Improvements and Public Improvements ...............8 Construction Plans.............................................................................................8 Completion of Construction...............................................................................9 Celtificate of Completion..................................................................................9 ARTICLE V Insurance Insurance......................................................................................................... .11 Subordination.................................... ...... ..................................... ...... ...... ...... ..12 Qualifications................................................................................................ ...12 1 Section 6.1. Section 6.2. Section 7.1. Section 8.1. Section 8.2. Section 8.3. Section 9.1. Section 9.2. Section 9.3. Section 9.4. Section 9.5. Section 10.1. Section 10.2. Section 10.3. Section 10.4. Section 10.5. Section 10.6. Section 10.7. Section 10.8. Section 10.9. Section 10.10. Section 10.11. EXHIBIT A EXHIBIT B 310855v2 MTN CL205-41 ARTICLE VI Taxes Right to Collect Delinquent Taxes...................................................................13 Review of Taxes............................................................................................. .13 ARTICLE VII Financing Mortgage Financing........................................................................................ .14 ARTICLE VIII Prohibitions Against Assigmnent and Transfer; Indemnification Representation as to Redevelopment ...............................................................15 Prohibition Against Redeveloper's Transfer of Redevelopment Property and Assigmnent of Agreement ...............................................................................15 Release and Indemnification Covenants ..........................................................16 ARTICLE IX Events of Default Events of Default Defined ...............................................................................18 Remedies on Default....................................................................................... .18 No Remedy Exclusive......................................................................................19 No Additional Waiver Implied by One Waiver ...............................................19 Attorney Fees.................................................................................................. .19 ARTICLE X Additional Provisions Conflict ofInterests; Authority Representatives Not Individual1y Liable.......20 Equal Employment Opportunity ......................................................................20 Restrictions on Use......................................................................................... .20 Provisions Not Merged With Deed..................................................................20 Titles of Articles and Sections .........................................................................20 Notices and Demands..................................................................................... .20 Counterparts.................................................................................................... .21 Recording.... .......................... .......... ... .............................. ........................ ....... .21 Amendment.................................................................. .......... ... ..................... ..21 Authority or City Approvals ............................................................................21 Termination ... ...... ....... .................................... ...... ........................ ................... .21 Legal Description of Redevelopment Property Purchase Agreement II EXHIBIT C EXHIBIT D 310855v2 MTN CL205-41 Concept Materials for Redevelopment Property Certificate of Completion iii CONTRACT FOR PRIVATE REDEVELOPMENT THIS AGREEMENT, made on or as of the 14th day of May, 2007, by and between COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY, COLUMBIA HEIGHTS, MINNESOTA, a public body corporate and politic (the "Authority"), established pursuant to Minnesota Statutes, Sections 469.090 to 469.1081 (hereinafter referred to as the "Act"), and GREATER METROPOLITAN HOUSING CORPORATION ("GHMC"), a Minnesota non-profit corporation (the "Redeveloper"). WITNESSETH: WHEREAS, the Authority was created pursuant to the Act and was authorized to transact business and exercise its powers by a resolution of the City Council of the City of Columbia Heights ("City"); and WHEREAS, the City and the Authority (as successor to the Housing and Redevelopment Authority in and for the City of Columbia Heights) have undeliaken a program to promote redevelopment of land which that is characterized by blight and blighting factors within the City pursuant to Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Act"); and WHEREAS, pursuant to the Act and the I-IRA Act, the Authority is authorized to undertake celiain activities to facilitate the redevelopment of real Redevelopment Property by private enterprise; and WHEREAS, the Authority believes that the redevelopment of the Redevelopment Property pursuant to this Agreement, and fulfillment generally of this Agreement, are in the vital and best interests of the City and the health, safety, morals, and welfare of its residents, and in accord with the public purposes and provisions of the applicable State and local laws and requirements under which the Project has been undeliaken and is being assisted. NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: ARTICLE I Definitions Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Act" means the Economic Development Authority Act, Minnesota Statutes, Sections 469.090 to 469.108, as amended. "Agreement" means this Agreement, as the same may be from time to time modified, amended, or supplemented. "Authority" means the Columbia Heights Economic Development Authority, or any successor 01' assign. "Authority Representative" means the Executive Director of the Authority, 01' any person designated by the Executive Director to act as the Authority Representative for the purposes of this Agreement. "Business Day" means any day except a Saturday, Sunday, legal holiday, a day on which the City is closed for business, 01' a day on which banking institutions in the City are authorized by law 01' executive order to close. "Certificate of Completion" means the certification provided to the Redeveloper, 01' the purchaser of any part, parcel 01' unit of the Redevelopment Property, pursuant to Section 4.4 of this Agreement. "City" means the City of Columbia Heights, Minnesota. "Construction Plans" means the plans, specifications, drawings and related documents on the construction work to be performed by the Redeveloper on the Redevelopment Propelty which a) shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the appropriate building officials of the City, and (b) shall include at least the following for each building: (1) site plan; (2) foundation plan; (3) basement plans; (4) floor plan for each floor; (5) cross sections of each (length and width); (6) elevations (all sides); (7) landscape plan; and (8) such other plans 01' supplements to the foregoing plans as the Authority may reasonably request to allow it to ascertain the nature and quality of the proposed construction work. "County" means the County of Anoka, Minnesota. "Event of Default" means an action by the Redeveloper listed in Article IX of this Agreement. 310855v2 MTN CL205-41 2 "Holder" means the owner of a MOltgage. "Minimum Improvements" means the division of the Redevelopment Propetty into two lots and the construction of a single family home on each lot with associated amenities. "Mortgage" means any mortgage made by the Redeveloper which is secured, in whole or in pmt, with the Redevelopment Property and which is a permitted encumbrance pursuant to the provisions of Article VIII of this Agreement. "Redevelopment Property" means the Redevelopment Property so described on Exhibit A. "Redeveloper" means Greater Metropolitan Housing Corporation or its permitted successors and assigns. "State" means the State of Minnesota. "Tax Official" means any County assessor; County auditor; County or State board of equalization, the commissioner of revenue of the State, or any State or federal district comt, the tax court of the State, or the State Supreme Court. "Termination Date" means the date the Authority or City issues the Certificate of Completion. "Transfer" has the meaning set forth in Section 8.2(a) hereof. "Unavoidable Delays" means delays beyond the reasonable control of the party seeking to be excused as a result thereof which are the direct result of war, significant weather conditions such as floods, tornadoes, or the like, terrorism, strikes, other labor troubles, fire or other casualty to the Minimmll Improvements, litigation commenced by third parties which, by injunction or other similar judicial action, directly results in delays, or acts of any federal, state or local governmental unit (other than the Authority in exercising its rights under this Agreement) which directly result in delays. Unavoidable Delays shall not include delays in the Redeveloper's obtaining of permits or governmental approvals necessary to enable construction of the Minimum Improvements by the dates such construction is required under Section 4.3 of this Agreement. 310855v2 MTN CL205-41 3 ARTICLE II RePl'cscntations and Warrantics Section 2.1. Representations bv the Authoritv. The Authority makes the following representations as the basis for the undertaking on its part herein contained: (a) The Authority is an economic development authority duly organized and existing under the laws of the State. Under the provisions of the Act, the Authority has the power to enter into this Agreement and carry out its obligations hereunder. (b) The activities of the Authority are undertaken to foster the redevelopment of certain real Redevelopment Property which for a variety of reasons is presently underutilized, to eliminate current blighting factors and prevent the emergence of fmther blight at a critical location in the City, to create increased tax base in the City, to stimulate fmther development in the City as a whole. Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper represents and warrants that: (a) The Redeveloper is a non-profit corporation duly organized and in good standing under the laws of the State of Minnesota, is not in violation of any provisions of its articles of incorporation or the laws of the State, is duly authorized to transact business within the State, has power to enter into this Agreement and has duly authorizcd the execution, delivery and performance ofthis Agreement by proper action of its governing body. (b) Upon acquisition of the Redevelopment Propelty, the Redeveloper will cause the Minimum Improvements to be constructed in accordance with the terms of this Agreement and all applicable local, state and federal laws and regulations (including, but not limited to, environmental, zoning, building code and public health laws and regulations). (c) The Redeveloper has received no notice or communication from any local, state or federal official that the activities of the Redeveloper or the Authority may be or will be in violation of any environmental law or regulation (other than those notices or communications of which the Authority is aware). The Redeveloper is aware of no facts the existence of which would cause it to be in violation of or give any person a valid claim under any local, state or federal environmental law, regulation or review procedure. (d) The Redeveloper will cause the Minimum Improvements to be constructed in accordance with all local, state or federal energy-conservation laws or regulations. (e) The Redeveloper will obtain or cause to be obtained, in a timely manner, all required permits, licenses and approvals, and will meet, in a timely manner, all requirements of all applicable local, state and federal laws and regulations which must be obtained or met before the Minimum Improvements may be lawfully constructed. 310855v2 MTN CLZ05-41 4 (f) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions or provisions of any corporate restriction or any evidences of indebtedness, agreement or instrument of whatever nature to which the Redeveloper is now a party or by which it is bound, or constitutes a default under any of the foregoing. (g) The Redeveloper shall promptly advise the Authority in writing of all litigation or claims affecting any part of the Minimum Improvements and all written complaints and charges made by any governmental authority materially affecting the Minimum Improvements or materially affecting Redeveloper or its business which may delay or require changes in construction of the Minimum Improvements. 310855v2 MTN CL205-41 5 ARTICLE III Acquisition and Convevance of Property Section 3.1. Status of Redevelopment Property The Authority has entered into that certain Purchase Agreement and Counter Offer between the Authority and AMC Mortgage Services (the "Seller") dated May 8, 2007 (the "Purchase Agreement"), for the sale of the Redevelopment Property to the Authority for the sale price of $86,000, attached as Exhibit B. At or before closing on the Purchase Agreement (the "Closing"), the Authority will assign the Purchase Agreement and the Redevelopment Property to the Redeveloper. Section 3.2. Terms. (a) At or before Closing, the Authority shall assign all its right, title and interest in the Purchase Agreement to the Redeveloper. At Closing, the Redeveloper will tender the sale price to the Seller and otherwise comply with the requirements of the Purchase Agreement. (b) Redeveloper shall, if required by the City, at its cost, prepare and obtain approval by the City of a plat of the Redevelopment Propeliy in accordance with City ordinances and procedures, to create two parcels or lots, upon which will be constructed a single family home on each parcel or lot (the "Minimum Improvements"), such parcel or lot having the approximate size and configuration shown in the concept materials (the "Concept Materials") attached as Exhibit C hereto, provided to staff of the Authority, with the construction of the Minimum Improvements governed by Article IV of this Agreement. (c) The closing on conveyance of the Redevelopment Propeliy from the Seller to the Redeveloper pursuant to the assignment of the Purchase Agleement by the Authority to the Redeveloper, shall occur on or before May 25, 2007, or at such other date as the patiies hereto a6'ree in writing ("Closing"). (d) The Redeveloper shall pay the Seller $86,000 for the purchase of the Redevelopment Properly at Closing. Section 3.3. Authority Assistance. (a) In order to facilitate construction of the Minimum Improvements which will achieve approved goals and objectives of the Authority, the Authority will undertake to pay $65,050 of the cost of acquisition of the Redevelopment Propeliy (the "Authority Assistance"). (b) The Authority Assistance shall be provided to the Redeveloper upon satisfaction ofthe following conditions precedent: (i) No Event of Default under this Agreement or event which would constitute such an Event of Default but for the requirement that notice be given or that a period of grace or time elapse, shall have occurred and be continuing; (ii) Redeveloper has submitted, and the Authority has approved, Construction Plans for the Minimum Improvements in accordance with Atiicle IV hereof; and 310855v2 MTN CL205-41 2 (iii) Redeveloper has completed construction of the Minimum Improvements and been issued the Celiificate of Completion as provided in Section 4.4. of this Agreement. Section 3.4. Title. (a) The Redeveloper and Authority understand that Redeveloper has reviewed and approved the state of title to the Redevelopment Propeliy at the Redeveloper's sole cost and expense, and as described in the Title Commitment provided by AMC Mortgage Services to the Authority (the "Commitment"). (b) The Authority shall take no actions to encumber or otherwise adversely affect title to the Redevelopment Propeliy. Section 3.5. Place of Document Execution, Deliverv and Recording. (a) Unless otherwise mutually agreed by the Authority, the Seller and the Redeveloper, the execution and delivery of all deeds, documents and the payment of the purchase price shall be made at the location provided for Closing under the Purchase Agreement and as agreed by the parties. (b) The Deed shall be in recordable form and shall be promptly recorded in the proper office for the recordation of deeds and other instnunents pertaining to the Redevelopment Property. (c) The closing costs shall be allocated and paid as set fOlih in the Purchase Agreement. Section 3.6. Business Subsidv. The patiies agree and understand that the financial assistance under this Agreement that benefits the Redevelopment Property does not constitute a business subsidy pursuant to Minnesota Statutes Section 1161.993, subd. 3, clause (7) (the "Business Subsidy Act") because the assistance is to accomplish redevelopment of the Redevelopment Property, and is assistance for housing. The Redeveloper releases and waives any claim against the City and the Authority and their respective goveming body members, officers, agents, servants and employees thereof arising from application of the Business Subsidy Act to this Agreement, including without limitation any claim that the Authority failed to comply with the Business Subsidy Act with respect to this Agreement. Section 3.7 Environmental Conditions. (a) The Redeveloper acknowledges that the Authority makes no representations or warranties as to the condition of the soils or environmental conditions on the Redevelopment Property or the fitness of such Redevelopment Property for construction of the Minimum Improvements or any other purpose for which the Redeveloper may make use of such Redevelopment Propeliy, and that the assistance provided to the Redeveloper under this Agreement neither implies any responsibility by the Authority or the City for any contamination of the Redevelopment Property nor imposes any obligation on such patiies to participate in any cleanup of such Redevelopment Propeliy. The Redeveloper is purchasing the Redevelopment Property in an "as is" and "with all faults" condition and as pursuant to the Purchase Agreement. 310855v2 MTN CL205-41 3 (b) Without limiting its obligations under Section 8.3 of this Agreement the Redeveloper further agrees that it will indemnify, defend, and hold harmless the Authority, the City, and their governing body members, officers, and employees, from any claims or actions arising out of the presence, if any, of hazardous wastes or pollutants existing on or in the Redevelopment Property and the activities of any contractor or agent of the Authority in conducting its activities on the Redevelopment Property. Section 3.8 Look-Back Participation. The parties agree that the Redeveloper intends to sell the homes constmcted on the Redevelopment Property for the target price of $235,000 each (the "Target Price"). If a home is sold for a purchase price in excess of the Target Price (the "Excess Profit"), the Excess Profit shall be split equally by Redeveloper and the Authority. In addition, if Redeveloper's development expenses are less than $535,050 (the "Development Profits") (the projected acquisition, demolition and construction costs of the Redeveloper (the "Redevelopment Costs"), such Development Profits shall be split equally by Redeveloper and the Authority. The total Look-back Pmticipation of the Authority (collectively, one-half of the Excess Profits and one-half of the Development Profits) shall not exceed the amount of Authority Assistance ($65,050). The Redeveloper shall provide documentation sufficient in the judgment of the Authority to verify the Redeveloper's Redevelopment Costs and sale price of each home. The Authority shall not be responsible for any deficit incurred by the Redeveloper in the acquisition, construction or sale of the Minimum Improvements. The provisions of this Section 3.8 shall survive the conveyance of the Deed for the Redevelopment Property, the Certificate of Completion for any portion of the Minimum Improvements and the subsequent conveyance of any deed thereofto a subsequent purchaser. Section 3.9. Records. The Authority or its representatives shall have the right at all reasonable times after reasonable notice to inspect, examine and copy all books and records of Redeveloper relating to construction of the Minimum Improvements. 310855v2 MTN CL205-41 4 ARTICLE IV Construction of Minimum Improvements and Public Improvements Section 4.1. Construction of Minimum Improvements and Public Improvements. The Redeveloper agrees that, upon acquisition of the Redevelopment Property, it will construct or cause construction of the Minimum Improvements on the Redevelopment Property, in substantial conformance with the Redeveloper's pro forma submitted to the staff of the Authority and the approved Construction Plans, and at all times while Redeveloper owns the Redevelopment Property, will operate and maintain, preserve and keep the respective components of the Minimum Improvements or cause such components be maintained, preserved and kept with the appurtenances and every part and parcel thereof, in good repair and condition. Section 4.2. Construction Plans. (a) Before commencement of construction of the Minimum Improvements the Redeveloper shall submit to the Authority the Construction Plans. The Construction Plans shall provide for the construction of the Minimum Improvements and shall be in conformity with this Agreement and all applicable State and local laws and regulations. The Authority Representative will approve the Construction Plans in writing if: (i) the Construction Plans conform to the terms and conditions of this Agreement; (ii) the Construction Plans conform to the goals and objectives of the Redevelopment Plan; (iii) the Construction Plans conform to all applicable federal, state and local laws, ordinances, rules and regulations; (iv) the Construction Plans are adequate to provide for construction of the Minimum Improvements; (v) the Construction Plans do not provide for expenditures in excess of the funds available to the Redeveloper from all sources (including Redeveloper's equity) for construction of the Minimum Improvements; and (vi) no Event of Default has occurred. Approval may be based upon a review by the City's Engineer and Building Official of the Construction Plans. No approval by the Authority Representative shall relieve the Redeveloper of the obligation to comply with the terms of this Agreement or of the Redevelopment Plan, applicable federal, state and local laws, ordinances, rules and regulations, or to construct the Minimum Improvements in accordance therewith. No approval by the Authority Representative shall constitute a waiver of an Event of Default. If approval of the Construction Plans is requested by the Redeveloper in writing at the time of submission, such Construction Plans shall be deemed approved unless rejected in writing by the Authority Representative, in whole or in part. Such rejections shall set forth in detail the reasons therefore, and shall be made within 15 days after the date of their receipt by the Authority. If the Authority Representative rejects any Construction Plans in whole or in part, the Redeveloper shall submit new or corrected Construction Plans within 15 days after written notification to the Redeveloper of the rejection. The provisions of this Section relating to approval, rejection and resubmission of corrected Construction Plans shall continue to apply until the Construction Plans have been approved by the Authority. The Authority Representative's approval shall not be umeasonably withheld, delayed or conditioned. Said approval shall constitute a conclusive determination that the Construction Plans (and the Minimum Improvements to be constructed in accordance with said plans) comply to the Authority's satisfaction with the provisions of this Agreement relating thereto. 310855v2 MTN CL205-41 5 (b) If the Redeveloper desires to make any material change in the Construction Plans after their approval by the Authority, the Redeveloper shall submit the proposed change to the Authority for its approval. If the Construction Plans, as modified by the proposed change, conform to the requirements of Section 4.2 of this Agreement with respect to such previously approved Construction Plans, the Authority shall approve the proposed change and notify the Redeveloper in writing of its approval. Such change in the Construction Plans shall, in any event, be deemed approved by the Authority unless rejected, in whole or in pmt, by written notice by the Authority to the Redeveloper, setting fOlth in detail the reasons therefor. Such rejection shall be made within 15 days after receipt of the notice of such change. The Authority's approval of any such change in the Construction Plans will not be unreasonably withheld. Section 4.3. Completion of Construction. (a) Subject to Unavoidable Delays, the Redeveloper must commence construction of the Minimum Improvements by July I, 2007 and must substantially complete construction of the Minimum Improvements by December 31, 2007. All work with respect to the Minimum Improvements to be constructed or provided by the Redeveloper on the Redevelopment Property shall be in substantial conformity with the Construction Plans as submitted by the Redeveloper and approved by the Authority and the City. If the Redeveloper is making substantial progress with respect to the redevelopment project, and is unable to meet one or more of the above-referenced deadlines, the Authority and the Redeveloper shall negotiate in good faith for a reasonable period to extend the time in which necessary action(s) must be taken or occur, the lapse of which time would otherwise constitute a default under this Agreement. (b) The Redeveloper agrees for itself, its successors and assigns, and every successor in interest to the Redevelopment Property, or any part thereof, that the Redeveloper, and such successors and assigns, shall promptly begin and diligently prosecute to completion the redevelopment of the Redevelopment Property through the construction of the Minimum Improvements thereon, and that such construction shall in any event be commenced and completed subject to Unavoidable Delay within the period specified in this Section 4.3 of this Agreement. Subsequent to conveyance of the Redevelopment Propelty, or any part thereof, to the Redeveloper, and until construction of the Minimum Improvements has been completed, the Redeveloper shall make reports, in such detail and at such times as may reasonably be requested by the Authority, as to the actual progress ofthe Redeveloper with respect to such construction. Section 4.4. Certificate of Completion. (a) Promptly after substantial completion of the Minimum Improvements in accordance with those provisions of the Agreement relating solely to the obligations of the Redeveloper to construct the Minimum Improvements (including the dates for completion thereof), the President and Executive Director of the Authority shall furnish the Redeveloper with a Celtificate of Completion in substantially the form attached as Exhibit D. Such certification shall be a conclusive determination of satisfaction and termination of the agreements and covenants in the Agreement with respect to the obligations of the Redeveloper, and its successors and assigns, to construct the relevant component of the Minimum Improvements and the dates for the completion thereof. Such certification mId such determination shall not constitute evidence of compliance with or satisfaction of any obligation 310855v2 MTN CL205-41 6 of the Redeveloper to any Holder of a Mortgage, or any insurer of a Mortgage, securing money loaned to finance the Minimum Improvements, or any part thereof. (b) The Certificate of Completion provided for in this Section 4.4 of this Agreement shall be in such form as will enable it to be recorded in the proper office for the recordation of deeds and other instruments pertaining to the Redevelopment Property. If the President and Executive Director of the Authority shall refuse or fail to provide any certification in accordance with the provisions of this Section 4.4 of this Agreement, the Authority shall, within thirty (30) days after written request by the Redeveloper, provide the Redeveloper with a written statement, indicating in adequate detail in what respects the Redeveloper has failed to complete the Minimum Improvements in accordance with the provisions of the Agreement, or is otherwise in default, and what measures or acts it will be necessary, in the opinion of the Authority, for the Redeveloper to take or perform in order to obtain such certification. (c) The construction of the Minimum Improvements shall be deemed to be substantially completed when the Redeveloper has received a certificate of occupancy from the City, and all site improvements have been substantially completed as reasonably determined by the Authority Representative. 310855v2 MTN CL205-41 7 ARTICLE V Insurance Section 5.1. Insurance. ( a) The Redeveloper will provide and maintain at all times during the process of constructing the Minimum Improvements an All Risk Broad Form Basis Insurance Policy and, from time to time during that period, at the request of the Authority, furnish the Authority with proof of payment of premiums on policies covering the following: (i) Builder's risk insurance, written on the so-called "Builder's Risk Completed Value Basis," in an amount equal to one hundred percent (100%) of the insurable value of the Minimum Improvements at the date of completion, and with coverage available in non-reporting form on the so-called "all risk" form of policy. The interest of the Authority shall be protected in accordance with a clause in form and content satisfactory to the Authority; (ii) Comprehensive general liability insurance (including operations, contingent liability, operations of subcontractors, completed operations and contractual liability insurance) together with an Owner's Contractor's Policy with limits against bodily injury and Redevelopment Property damage of not less than $1,000,000 for each occurrence (to accomplish the above-required limits, an umbrella excess liability policy may be used); (iii) Automobile liability insurance to cover claims for damages because of bodily injury or death of any person or Redevelopment Property damage arising out of the ownership, maintenance or use of any motor vehicle of not less than $1,000,000; and (iv) Workers' compensation insurance, with statutory coverage. (b) All insurance required in Article V of this Agreement shall be taken out and maintained in responsible insurance companies selected by the Redeveloper which are authorized under the laws of the State to assume the risks covered thereby, and shall name the Authority, the City and any Mortgagee as an additional named insured thereunder. Upon request, the Redeveloper will deposit amlUally with the Authority policies evidencing all such insurance, or a celtificate or certificates or binders of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Article V of this Agreement each policy shall contain a provision that the insurer shall not cancel nor modify it in such a way as to reduce the coverage provided below the amounts required herein without giving written notice to the Redeveloper and the Authority at least thitty (30) days before the cancellation or modification becomes effective. In lieu of separate policies, the Redeveloper may maintain a single policy, blanket or umbrella policies, or a combination thereof, having the coverage required herein, in which event the Redeveloper shall deposit with the Authority a celtificate or celtificates of the respective insurers as to the amount of coverage in force upon the Minimum Improvements. 3\0855v2 MTN CL205-4\ 8 (c) The Redeveloper agrees to notify the Authority immediately in the case of damage exceeding $100,000 in amount to, or destruction of, the Minimum Improvements or any portion thereof resulting from fire or other casualty. In such event the Redeveloper will forthwith repair, reconstruct and restore the Minimum Improvements to substantially the same or an improved condition or value as it existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restoration, the Redeveloper will apply the net proceeds of any insurance relating to such damage received by the Redeveloper to the payment or reimbursement of the costs thereof. The Redeveloper shall complete the repair, reconstmction and restoration of the Minimum Improvements, whether or not the net proceeds of insurance received by the Redeveloper for such purposes are sufficient to pay for the same. Any net proceeds remaining after completion of such repairs, constmction and restoration shall be the Redevelopment Propelty of the Redeveloper. (d) The Redeveloper and the Authority agree that all of the insurance provisions set fOlth in this Article V shall terminate on the Termination Date. Section 5.2. Subordination. Notwithstanding anything to the contrary contained in this Article V, the rights of the Authority with respect to the receipt and application of any proceeds of insurance shall, in all respects, be subj ect and subordinate to the rights of any lender under a Mortgage approved pursuant to Article VII of this Agreement. Section 5.3. Qualifications. Notwithstanding anything herein to thc contrary, the patties acknowledge and agree that: (a) Upon transfer of the Redevelopment Propelty or portion thereof to another person or entity, the Redeveloper will remain obligated under Section 5.1 hereof relating to such pOltion transferred, unless the Redeveloper is released from such obligations in accordance with the terms atld conditions of Section 8.2(b )- (d) hereof. 310855v2 MTN CL205-41 9 ARTICLE VI Taxes Section 6.1. Right to Collect Delinquent Taxes. The Redeveloper acknowledges that the Authority is providing financial assistance in furtherance of the redevelopment described in this Agreement, and that part of the consideration for such assistance is the improvement of tax base in the City. To that end, the Redeveloper agrees for itself, its successors and assigns, in addition to the obligation pursuant to statute to pay real estate taxes, that it is also obligated by reason of this Agreement to pay before delinquency all real estate taxes assessed against the Redevelopment Property and the Minimum Improvements. The Redeveloper acknowledges that this obligation creates a contractual right prior to the Termination Date to sue the Redeveloper or its successors and assigns to collect delinquent real estate taxes and any penalty or interest thereon and to pay over the same as a tax payment to the county auditor. In any such suit, the Authority shall also be entitled to recover its costs, expenses and reasonable attorney fees. Section 6.2. Review of Taxes. The Redeveloper agrees that prior to the Termination Date, it will not cause a reduction in the real Redevelopment Propelty taxes paid in respect of the Redevelopment Propelty tlu'ough: (A) willful destruction of the Redevelopment Property or any part thereof; or (B) willful refusal to reconstruct damaged or destroyed Propelty pursuant to Section 5.1 of this Agreement. The Redeveloper also agrees that it will not, prior to the Termination Date, apply for a deferral of Redevelopment Propelty tax on the Redevelopment Property pursuant to any law, or transfer or permit transfer of the Redevelopment Property to any entity whose ownership or operation of the Redevelopment Property would result in the Redevelopment Propelty being exempt from real estate taxes under State law (other than any pOltion thereof dedicated or conveyed to the City or Authority in accordance with this Agreement). 310855v2 MTN CL205-41 10 ARTICLE VII Financing Section 7.1. Mortgage Financing. (a) The Redeveloper shall obtain one or more commitments for financing which, together with committed equity for such construction, is sufficient for payment of the Construction Costs for the Minimum Improvements. Such commitments may be short term financing, long term mortgage financing, a bridge loan with a long term take-out financing commitment, or any combination of the foregoing. (b) In the event that there occurs a default under any Mortgage obtained by the Redeveloper pursuant to Section 7.1 of this Agreement, the Redeveloper shall cause the Authority to receive copies of any notice of default received by the Redeveloper from the holder of such Mortgage. Thereafter, the Authority shall have the right, but not the obligation, to cure any such default on behalf of the Redeveloper within such cure periods as are available to the Redeveloper under the MOltgage documents. In the event there is an event of default under this Agreement, the Authority will transmit to the Holder of any MOltgage a copy of any notice of default given by the Authority pursuant to Article IX of this Agreement. (c) In order to facilitate the securing of other financing, the Authority agrees to subordinate its rights under this Agreement provided that such subordination shall be subject to such reasonable terms and conditions as the Authority and Holder mutually agree in writing. 310855v2 MTN CL205-41 II ARTICLE VIII Prohibitions Aeainst Assienment and Transfer; Indemnification Section 8.1. Representation as to Redevelopment. The Redeveloper represents and agrees that its purchase of the Redevelopment Property, and its other undertakings pursuant to the Agreement, are, and will be used, for the purpose of redevelopment of the Redevelopment Property and not for speculation in land holding. Section 8.2. Prohibition Against Redeveloper's Transfer of Redevelopment Propertv and Assignment of Agreement. The Redeveloper represents and agrees that prior to issuance of the Certificate of Completion for the Minimum Improvements: (a) Except as specifically described in this Agreement, the Redeveloper has not made or created and will not make or create or suffer to be made or created any total or partial sale, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to this Agreement or the Redevelopment Property or any part thereof or any interest therein, or any contract or agreement to do any of the same, to any person or entity (collectively, a "Transfer"), without the prior written approval of the Authority's board of commissioners. The term "Transfer" does not include (i) encumbrances made or granted by way of security for, and only for, the purpose of obtaining construction, interim or permanent financing necessary to enable the Redeveloper or any successor in interest to the Redevelopment Propelty or to construct the Minimum Improvements or component thereof; (ii) any lease, license, easement or similar arrangement entered into in the ordinary course of business related to operation ofthe Minimum Improvements; or any (iii) sale of a single family home constituting a pOltion of the Minimum Improvements to a purchaser who will occupy such home as the purchaser's principal place of residence. (b) If the Redeveloper seeks to effect a Transfer prior to issuance of the Certificate of Completion, the Authority shall be entitled to require as conditions to such Transfer that: (i) any proposed transferee shall have the qualifications and financial responsibility, in the sole and reasonable judgment of the Authority, necessary and adequate to fulfill the obligations undertaken in this Agreement by the Redeveloper as to the portion ofthe Redevelopment Property to be transferred; and (ii) Any proposed transferee, by instrument in writing satisfactory to the Authority and in form recordable in the public land records of Anoka County, Minnesota, shall, for itself and its successors and assigns, and expressly for the benefit of the Authority, have expressly assumed all of the obligations of the Redeveloper under this Agreement as to the portion of the Redevelopment Propelty to be transferred and agreed to be subject to all the conditions and restrictions to which the Redeveloper is subject as to such pOltion; provided, however, that the fact that any transferee of, or any other successor in interest whatsoever to, the Redevelopment Propelty, or any part thereof, shall not, for whatever reason, have assumed such obligations or so agreed, mId shall not (unless and only to the extent otherwise specifically provided in this Agreement or agreed 31 0855v2 MTN CL205-41 12 to in writing by the Authority) deprive the Authority of any rights or remedies or controls with respect to the Redevelopment Property, the Minimum Improvements or any part thereof or the construction of the Minimum Improvements; it being the intent of the parties as expressed in this Agreement that (to the fullest extent permitted at law and in equity and excepting only in the manner and to the extent specifically provided otherwise in this Agreement) no transfer of, or change with respect to, ownership in the Redevelopment Property or any part thereof, or any interest therein, however consummated or occurring, and whether voluntary or involuntary, shall operate, legally, or practically, to deprive or limit the Authority of or with respect to any rights or remedies on controls provided in or resulting from this Agreement with respect to the Redevelopment Property that the Authority would have had, had there been no such transfer or change. In the absence of specific written agreement by the Authority to the contrary, such transfer or approval by the Authority thereof shall not be deemed to relieve the Redeveloper, or any other party bound in any way by this Agreement or otherwise with respect to the Redevelopment Propeliy, from any of its obligations with respect thereto; and (iii) Any and all instruments and other legal documents involved in effecting the transfer of any interest in this Agreement or the Redevelopment Property governed by this Article VIII, shall be in a form reasonably satisfactory to the Authority. (c) If the conditions described in paragraph (b) are satisfied in the sole judgment of the Authority, then the Transfer will be approved and the Redeveloper shall be released from its obligation undcr this Agreement, as to the portion of the Redevelopment Prope1iy that is transferred, assigned, or otherwise conveyed. The provisions of this paragraph (c) apply to all subsequent transferors, assuming compliance with the terms ofthis Aliicle. (d) Upon issuance of the Celiificate of Completion, the Redeveloper may transfer or assign the Minimum Improvements and/or the Redeveloper's rights and obligations under this Agreement with respect to such Redevelopment Property without the prior written consent of the Authority. Section 8.3. Release and Indenmification Covenants. (a) The Redeveloper releases from and covenants and agrees that the Authority and the City and the governing body members, officers, agents, servants and employees thereof shall not be liable for and agrees to indenmify and hold harmless the Authority and the City and the governing body members, officers, agents, servants and employees thereof against any loss or damage to Redevelopment Property or any injury to or death of any person occurring at or about or resulting from any defect in the Minimum Improvements or the Public Improvements, except for any such damages or injuries directly related to the gross negligence of the Authority or the City. (b) Except for any willful or negligent misrepresentation or any willful or wanton misconduct or negligence of the following named parties, the Redeveloper agrees to protect and defend the Authority and the City and the governing body members, officers, agents, servants and employees thereof (the "Indemnified Patiies"), now or forever, and further agrees to hold the Indemnified Parties harmless from any claim, demand, suit, action or other proceeding 310855v2 MTN CL205-41 13 whatsoever by any person or entity whatsoever ansmg or purportedly ansmg from this Agreement, or the transactions contemplated hereby or the acquisition, construction, installation, ownership, and operation of the Minimum Improvements. (c) Except for any negligence of the Indemnified Patties (as defined in clause (b) above), and except for any breach by any of the Indemnified Parties of their obligations under this Agreement, the Indemnified Patties shall not be liable for any damage or injury to the persons or Redevelopment Property of the Redeveloper or its officers, agents, servants or employees or any other person who may be about the Minimum Improvements or Public Improvements due to any act of negligence of any person. (d) All covenants, stipulations, promises, agreements and obligations of the Authority contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Authority and not of any governing body member, officer, agent, servant or employee of the Authority in the individual capacity thereof. 310855v2 MTN CL205-41 14 ARTICLE IX Events of Default Section 9.1. Events of Default Defined. The following shall be "Events of Default" under this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement, anyone or more of the following events, after the non-defaulting party provides 30 days written notice to the defaulting party of the event, but only if the event has not been cured within said 30 days or, if the event is by its nature incurable within 30 days, the defaulting party does not, within such 30-day period, provide assurances reasonably satisfactory to the pmty providing notice of default that the event will be cured and will be cured as soon as reasonably possible: (a) Failure by the Redeveloper or the Authority to observe or perform any material covenant, condition, obligation, or agreement on its part to be observed or performed under this Agreement; (b) The Redeveloper: (i) files any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act or under any similar federal or State law; (ii) makes an assigmnent for benefit of its creditors; (iii) admits in writing its inability to pay its debts generally as they become due; (iv) is adjudicated a bankrupt or insolvent; (v) attempts a Transfer without complying with the requirements of Article VIII of this Agreement Section 9.2. Remedies on Default. Whenever any Event of Default referred to in Section 9.1 of this Agreement occurs, the non-defaulting party may exercise its rights under this Section 9.2 after providing thirty days written notice to the defaulting pmty of the Event of Default, but only if the Event of Default has not been cured within said thhty days or, if the Event of Default is by its nature incurable within thirty days, the defaulting pmty does not provide assurances reasonably satisfactory to the non-defaulting party that the Event of Default will be cured and will be cured as soon as reasonably possible: (a) Take whatever action, including legal, equitable or administrative action, which may appear necessary or desirable to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant under this Agreement. 310855v2 MTN CL205-41 15 Section 9.3. No Remedv Exclusive. No remedy herein conferred upon or reserved to the Authority or Redeveloper is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Authority to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in this Article IX. Section 9.4. No Additional Waiver Implied by One Waiver. In the event any agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the patiicular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. Section 9.5. Attornev Fees. Whenever any Event of Default occurs and if the Authority or Redeveloper shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement of performance or observance of any obligation or agreement on the pati of the Redeveloper or Authority under this Agreement, the non-prevailing party in any such action agrees that it shall, within 10 days of written demand by the prevailing patiy, pay to the prevailing patiy the reasonable fees of such attorneys and such other reasonable expenses so incurred. 310855v2 MTN CL205.41 16 ARTICLE X Additional Provisions Section 10.1. Conflict of Interest: Authoritv Representatives Not Individuallv Liable. The Authority and the Redeveloper, to the best of their respective knowledge, represent and agree that no member, official, or employee of the Authority shall have any personal interest, direct or indirect, in the Agreement, nor shall any such member, official, or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership, or association in which he is, directly or indirectly, interested. No member, official, or employee of the Authority shall be personally liable to the Redeveloper, or any successor in interest, in the event of any default or breach by the Authority for any amount which may become due to the Redeveloper or successor or on any obligations under the terms of the Agreement. Section 10.2. Equal Emplovment Opportunitv. The Redeveloper, for itself and its successors and assigns, agrees that during the construction of the Minimum Improvements provided for in the Agreement it will comply with all applicable federal, state and local equal employment and non-discrimination laws and regulations. Section 10.3. Restrictions on Use. The Redeveloper agrees that until the Termination Date, the Redeveloper, and such successors and assigns, shall devote the Redevelopment Property to, the operation of the Minimum Improvements for uses described in the definition of such term in this Agreement, and shall not discriminate upon the basis of race, color, creed, sex or national origin in the sale, lease, or rental or in the use or occupancy of the Redevelopment Property or any improvements erected or to be erected thereon, or any patt thereof. Section 10.4. Provisions Not Merged With Deed. None of the provisions of this Agreement at.e intended to or shall be merged by reason of any deed transferring any interest in the Redevelopment Property and any such deed shall not be deemed to affect or impair the provisions and covenants of this Agreement. Section 10.5. Titles of Articles and Sections. Any titles of the several parts, Alticles, and Sections of the Agreement are inserted for convenience of reference only and shall be disregat.ded in construing or interpreting any of its provisions. Section 10.6. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under the Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally; and (a) in the case of the Redeveloper, is addressed to or delivered personally to the Redeveloper at 15 South Fifth Street, Suite 710, Minneapolis, MN 55402, Attn: President; and 310855v2 MTN CL205.41 17 (b) in the case of the Authority, is addressed to or delivered personally to the Authority at 590 - 40th Avenue NE, Columbia Heights, Minnesota 55421, Attn: Executive Director; or at such other address with respect to either such party as that party may, from time to time, designate in writing and forward to the other as provided in this Section. Section 10.7. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 10.8. Recording. The Authority may record this Agreement and any amendments thereto with the Anoka County recorder. The Redeveloper shall pay all costs for recording. Section 10.9. Amendment. This Agreement may be amended only by written agreement approved by the Authority and the Redeveloper. Section 10.1 O. Authoritv or Citv Approvals. Unless otherwise specified, any approval required by the Authority under this Agreement may be given by the Authority Representative. Section 10.11. Termination. This Agreement terminates on the Termination Date, except that termination of the Agreement does not terminate, limit or affect the rights of any party that arises before the date the City issues the Celtificate of Completion, or as otherwise provided herein. 310855v2 MTN CL205-4! 18 IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf and its seal to be hereunto duly affixed and the Redeveloper has caused this Agreement to be duly executed in its name and behalf on or as of the date first above written. COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY By Its President By Its Executive Director STATE OF MINNESOTA ) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of 2007, by and , the President and Executive Director of the Columbia Heights Economic Development Authority, a public body politic and corporate, on behalf of the Authority. Notary Public 310855v2 MTN CL205-41 19 GREATER METROPOLITAN HOUSING CORPORATION By Its STATE OF MINNESOTA ) ) ss. COUNTY OF ) The foregoing instrument was acknowledged before me this _ day of , 2007 by , the of the Greater Metropolitan Housing Corporation, a Minnesota non-profit corporation, on behalf of the corporation. Notary Public 310855v2 MTN CL205-41 20 EXHIBIT A Legal Description of Redevelopment Property Lots 25 and 26, Block 43, Columbia Heights Annex to Minneapolis, Anoka County 310855v2 MTN CLZ05-41 A-I EXHIBIT B Purchase Agreement 310855v2 MTN CL205-41 C-I 05/07/2007 08:08 5515%0872 MARK WIEBUSCH PAGE 02/05 EXHI'&\T B ~ (~ MORTGAGE SERVICES Standard Counter Offer Loan #: 0105477947 This Is a counteroffer 0 the Real Estate Purchase Contract and Receipt for Deposit dated f:1alI,..a, 20llZ, for prop rty known as: 4141 JEFFERSON ~T NE. COLUMBIA HEIGHT~. MN ~ (the "Property" where Citv of Columhfa H<'!Ipht,; Ff)A i" refp..rred to as Buyer and AMC Mortgage Services 15 referred to as Seller. seller accepts the term and conditions In the contract with the following changes: 1. Sales Price shall be 86000.00. 2. Buyer's deposit shal be $ 2500.00 in the form of a cashier's check or a certified check. 3. Seller agrees to p y up to $ ll.llll. for Buyer's closing costs, which are deftned as prepaid, nonrecurri g, and non-allowable costs. 4. Seller agrees to pa up to $ll.llll. toward repairs on the Property. Any repair amount in excess of the stated amount shall be the sole responsibility of Buyer. No repairs shall be started without the eller's consent. 5. Seller agrees to pay for tne tOllowing items up to but not to exceed the following amount: we. 6. Buyer to provide eller's agent with a Source of Funds document prior to offer acceptance, 7. Buyer to make a rltten application loan approval within two (2) days. Buyer Is to remove the apprais I contingency within (Ten) 10 days and have Lender's written loan approval withlrl Tw nty (20) days after acceptance of this counteroffer. If this ;s an all cash transactio ,_ buyer a.nr~~Q tn waivA ;tll flft;!inr.ir"u) rontin9C!neiGlIllr 8. Buyer shall r:nmplet all inspections within ~(O) days of counteroffer acceptance" Buyer is solely resp nsible for the costs of all Inspections. Seller will not adjust the sales price due to the find ngs of any Inspections. Seller will not pay for a property surveyor abstract. 9. Buyer hereby elects to utilize Seller's attorney/title company/escrow company for the purpose of issuing ti Ie insurance, In consideration thereof, Seller agrees to pay for the Owner's title Insura ce policy. Seller will not provide a surveyor abstract. Seller will transfer title with a 'mited or Special Warranty Deed. 10. Unless otherwise sp clfied. Buyer and Seller shall pay their own closing costs. Buyer's Initials: ( ) ( ) Seller's Initials: ( ) ( ) AMC Stmldard J.,~tm(crOD6r IJIN#SD-QI201J.2 Page J oi5 Revised 111011]005 05/07/2007 08:08 5515%0872 MARK WIEBUSCH PAGE 03/05 r!m C MORTGAGE SERVICES Standard Counter Offer Loan #, 0105477947 I1.Time is of the es ence. If the transaction does not close by May 25. 20.QZ, through no fault of Sell~r, Slier reserves the right to cancel the transaction. In the event Seller elects to extend th closing period, Buyer shall be charged a per diem of $100.00 until the transaction clo es. In thA event SAiler cancels escrow for Buyer's and or F:lIlYFlr'S Lenders nonperror ance or negligence, Buyer shall sign cancellation papers within 24 hours and forfeit Bu er's deposit to Seller. 12.Seller shall pay up to $0.00 for Section I charges listed on the termite report. The Buyer shall pay any and all costs in excess of the stated amount, 13. The sale is subj ct to management approval of Seller. Tnis sale may be subjected to MGI /PMI and/or investor approval. 14. The sale is continge t upon clOsing without the need for Seller to deposit funds to clo''', If funds are require , Seller may terminate the transaction without liability or obligation to Buyer. 1S.Addltional terms: IU8 16. Buyer hereby hold delivering a "Real Seller and ~eller's express or Implied, acquired the Prope Seller and Seller's Agent harmless from not completing and state Transfer and Disclosure Statement" and aCknowledqes that Agent have made absolutely no representations or warranties, s to the condition of the Property. Buyer acknowledges that Seller through foreclosure or default. 17. Buyer is aware that he Property is sold In its PRESENT, AS IS condition with all defects, If any. seller stro gly encourages Buyer to obtain expert advice by prOfessional inspections as to, ut not limited to, the electrical, structural, plumbing, geological, utilities, and roof c ndition of the Property. Buyer is purchasing the Property In Its present condition wi hout any obligation by Seller to make any changes, alterations or repairs, Seller and Seller's Agent do not warrant the existing structure as to its habitability or sulta llity for occup"ncy, nor that the Property meets city, counLy, ~l"l", or federal ordlnanc s or codes. Buyer assumes all responsibility to check with the appropriate planning authority for the Intended use. Buyer assumes all responsibility for [luyer'. Intended u~ and agrees to hold Seller harmless as to suitability for Buyer's intended use. 18. Buyer aCknowledges that it: i) has sufficient information regarding the PrOperty, il) is relying on Its own e perts and not Seller or any information provided by Seller, If any; and iii) 15 not look ng to Seller for any addlliunal information with respect to the condition of the Prop rty. Buyer's Initials I ( AMC Smndard GO/l"tal'(),tI~r DIN#SD.Ol1Q0.2 ) ( Seller's Initials: ( ) ( ) Page 2015 .,"".. /2iV21l00J 05/07/2007 08:08 6516960872 MARK WIEBUSCH PAGE 04/06 - IIIII MORTGAGE SE C VICES Standard Counter Offer Loan #: 0105477947 19. Buyer is advised th t personal property is not included In the purchase. If Seller has any Interest in personal property at the Property, Seller agrees to give Buyer Its Interest In the personal prope , if any, without any warranties or representations, express Or Implied. as to the 0 nershlp or condition of the personal property. Thi< inr.h.tdes, but is not limited to, key. garage door openers, window and wall coverings, fixtures, and freestanding applla es, If any. 20. This instruction re laces and supersedes any and all statements concerning the condition of the Pro erty and any "Seller's Representation<" concerning the condition of the Property, the p rsonal property, or any matter that may be included in the original contract. Should t ere be any discrlpancy between the original contract and this r.nllnteroff~r. the te s of this counteroffer Ghall control, 21. The closing of thl premises al e unc.on nature and In its pr transaction shall constitute Buyer's acknowledgement that the Itlonally accepteo without representation or warranty of any kind Or ent condition based solely on Buyer's Inspection. 22. Seller haS acquired the Property via foreclosure and may be unaware of existing title defects and/or lien . ShOUld Seller be unable or unwilling to clear said title defects and/or lien., Seller m~y terminate the transaction. In this event, Buyer'S sOle remedy shall be the return 0 the earnest money deposit. ZJ. Seller's (;nOlce of CI sing Company is to be: West Title - Minnetonka - MN Contact: Phone: 1952\ 252-2500 Fax:9522522505 24. Bond. and Assessm nto now ~ lien shall be p~id current by the Seller, any p~yments not yet due are to e assumed by the buyer. Buyer and Seller agree that Taxes are to be prorated to the c ose date. 25. Addendum A Is to si ned by the buyer and Seller and Is to be made part of this agreement. 26. Seller will not allo Mortgage, Argent of their choice. financing through company affiliate lenders; Ameriquest artgage. Buyer to find financing through any other lender Buyer's Initials: ( AM(,: ~/(l"da"d C:oulfrerqffl!t' DIN#SD.OJ2rJO.l ) ( ) Seller's Initials: ( )( ) n~ViJM 12/014Q05 Page 3015 B5/B7/2007 08:08 5515950872 MARK WIEBUSCH PAGE 05/05 "'" IIIII MORTGAGE S Standard Counter Offer Loan #: 0105477947 Seller reserves the rig t to continue to offer the Property for ""I" and accept any offer at any time prior to recei t by Seller or Seller's Agent of a copy of this Counteroffer, accepted and signed by Eluyer. 'Accept," as used herein, includes delivery In person, by mail, or by facsimile. Unless this Counteroff r is accepted on or before May 14, 2007, at 12 noon, it shall h" deemed revoKed and t e deposit shall be returned to Buyer. Seiler'S acceptance of another offer shall revoke this Counteroffer. This Counteroffer may be executed In two or more counterparts, all of whi h shall constltlJtl!> one and the .ame writing. Date' ,20__ Seller: o The undersigned Bu er accepts the above Counteroffer, or o The undersigned Bu er accepts the above Counteroffer with the following changes: Date: ,20_ Buyer: Date: ,20_ Buy!::!,: The following is req ired only if the Buyer has made changes or amendments abo".., Seller accepts the Swyer's chonges lu S..lIer's counterorter and agrees to sell on the above terms and co ditions. Dill'" ,20_ Serler; NO REPRESENTATION S MADE AS TO THE LEGAL VALIDI1Y OF ANY PROVISION OR THE ADE:QUACY OF ANY PR VISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALI lED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. A Me Slall(lc",J COIIYllf!f'i)ff~r DlN# SlJ-mVQ-2 "ag" 4 olS R(!',Ji,led /21O:J12I)OJ 05/07/2007 08:08 6516950872 MARK WIE8USCH PAGE 06/06 "'" I I I I I MORTGAG.E S Standard Counter Offer Loan #: 0105477947 ADD.I;NI)UMA FORECLOSURI!: YKUV1SlUN Addendum to (Purchase C ntract and/or Counter Offer) dated for the property located at 4141 JEFFERSON ST NE. COLUMBIA HEIGHTS. MN 55421. Buyer is aware th.t Selle acquired the property that is the subjAIT 01 thlR tran.actlon by way of loreclosure, and that Sell r is selling and Buyar Is purchasing the property in its present "As-Is" Condition without represen .tions Or warranties of any kind or n.ture. Buyer acknowledges for B yer .nd Buyer's successors, heirs .nd .ssignees, that Buyer has been given a reasonable oppo unity to inspect and investigate the property and all improvements lher~ulI, either Indepenoe tly Or through agents or Buyer's choosing, .nd that in purchasing the property Buyer Is not rely ng on Seller, or its agents, as to the condition or s.fety of the property and/or any improvement thereon, In<:ludlng but not limited to. electrical, plumbing, heating, sewer, roof, air condltlonl g, if any, foundations. soils and geology, lot size or suitability of the property .nd/or its Impro ements lor partl<:ular purposes, or th.t appliances, if any, plumbing and/or utilities are In work ng nrnP,:f, and/or that the ImprOlJerT'll~nts are 6tructurally sound and/or in compliance with any city, ounty, state and/or FeCferal statutes, codes or ordinances. Any reports, repairs or work requlreCf b Buyer's lender is to be the sole responsibility of the Buyer. Seller does not w.rrant ex sting structure as to its habltabiiity or suitability for occupancy. Buyer(s) assumes responSibility to heck with the appropriate planning authority for intended use and hold S~II.r ~nd Broker harmiess as to SUitability tor Buyer(s) intended use. Mold mayor may not hay been removed or covered in the course of any r.h=!aning nr repair!n!) of the property. The purchas r acknowledges that, if seller Or any of seller's employees, contractors, or agents cleaned or repai d the property or remedlate Mold contamination, that seller does not warrant thA r.:1l~ar'ling repai Or remediation. Suyer to aat:15fy themselves with their own Inspections at the Buyer's expense an Buyer acknowledges and agrees to accept full responsibility/risk for any matters that may result f m microscopic organisms and/or mold anCf to hold harmless, release and indemnify seller and Ot a~ 'Iyns, investors, Selling brOKer/agent, their officers, employees, agents, heirs, executors, admlnist ators and successors from any liability/recourse/damages (financial or otherwise). Buyer(s) further states th t they are relying solely upon their own inspection of subject property and not upon any repres ntation made to them by ;my nAl"Ron whomso@ver, and IS: purchasing subject property in the con ition In which It now is, without any obligation on the part of the Seller to make any changes, alter tions, or repair thereto. Sellers gives no warranties of fitness regarding such personal property that belongs to Seller that is transferreCf as a part of the purchase, The closing of this transa tion shall constitute as an a<:knowledgment by the Buyer(s) that THE PREMIS~S WERE ACCEPTE WITHOUT REPRESENTATION OR WARRANTY OF ANY KIND OR NATURE AND IN ITS PRESENT "AS I .. CONDlTION BASED SOLELY ON BUYER'S OWN INSPECTION. Buyer D.te Buyer Date Seller Date Seller Date AMe STC1ndard Coume1'O.QCr DINtlSlJ.()JlfJn.2 Page 3afJ Ri!vhad , 2Iflt/~OfJ.'i 310855v2 MTN CL205-41 EXHIBIT C Concept Materials for Redevelopment Property C-I EXHIBIT C GREATER METROPOLITAN HOUSING CORPORATION - Twin Cities 15 South Fifth Street, Suite 710. Minneapolis, MN 55402 phone: (612) 339-0601. fax: 612-339-0608 e-mail: bbuelow@qmmhc.orq . website: www.gmhctc.org Proposed for 4141 Jefferson Street .(TWO) 2-STORY MODEL WI FULL FRONT PORCH BUILDING FEATURES: . 1,650 Finished S.F on the 15t and 2nd Floors . 3 Bedroom . 2 and Yz Bathrooms . Full Basement, 832 S.F., 2 Egress Windows and Full Bathroom Rough-in . Formal Dining Room . Large Kitchen . Oak Cabinets wi Plastic laminate Tops . Kitchen Appliance Allowance . Oak Interior Doors, Window Casing and Baseboard . Large Front Porch . Ceramic Floors and Tub Surround in Bathrooms . High Efficiency Mechanical System o 90% + Efficient Furnace o Air-to-Air Exchanger o Central Air-Conditioning o Direct-Vent Water Heater o Programmable Thermostat . Low Maintenance Exterior o Vinyl Siding o Pre-Finished Aluminum Soffits, Facia, and Trim o Aluminum Clad Double-Hung Windows o Aluminum Gutters and Down Spouts . Large Two-Car Detached Garage . Landscaping includes new sod from street to alley EXHIBIT C EXHIBIT C I , ~ 2~f ~~.i il!, Inl o~~1 Ihii . g ~ I ~ OI>>"1IHI1AJ~JSViI AVM3!\IOO SnONlVUUl8 --~- -- - -- ~ ----....l..-j _..1 t!l {:j :i ~~ iIi" " ~~ (! {:j ii ~~ r-;s ~;:;:, ! i...... t... .... ~ i ~~ h 1I1I lill II lI~i~ h k.b~ ~.~ u.~* ~~~ mil ~_d., I OW"iiIHIlAll/3dOlklJ.BlA '""""" "'... A311V ~ ~ I Ii -.o-SI ... o ~.g 9;1 If! I M r' . . ~ I 21 ~ .- .- Ii U. ~d Ollr;fillkUa,lOl:ldlSVJ .l AVM3fJOO ~ S/1ONlWllus .. ---- --.- - L----.-~L----.i w ;; ,~ ~{:j! I~ (!~:: ~~ " h t , ................h.. ..................~ ~ :d1-- ~ ~ ~ " i . ~ lJot"'1lHl1..ut13dOU.1.1B31.\ .'3"N .l33~.lS NOS~3:1:13r Z <f------CI 1 ~ z :2 ~ J: (!) 1"' ill J: ::!; W ~ ....I 0 () u.i :i Iii w It: I- en z 0 en It: w LL LL W -, ~ ~ v 0 Z <( ~ v ~ v z :'.J n. w l- ii) I- ::; n. en b ....I EXHIBIT D CERTIFICATE OF COMPLETION The undersigned hereby certifies that Greater Metropolitan Housing Corporation (the "Redeveloper") has fully complied with its obligations under Articles III and IV of that document titled "Contract for Private Redevelopment," dated November 28, 2006 between the Columbia Heights Economic Development Authority and the Redeveloper (the "Contract"), with respect to construction of the Minimum Improvements in accordance with the Construction Plans, and that the Redeveloper is released and forever discharged from its obligations to construct the Minimum Improvements under Articles III and IV. Dated: ,2007 COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY By Its President By Its Executive Director STATE OF MINNESOTA ) ) ss. COUNTYOFANOKA ) On this _ day of ,2007, before me, a Notary Public within and for said County, personally appeared , to me personally known, who, being by me duly sworn, did say that (s)he is the President of the Authority named in the foregoing instrument; that the seal affixed to said instmment is the seal of said Authority; that said instrument was signed and sealed in behalf of said Authority by authority of its governing body; and said acknowledged said instrument to be the free act and deed of said Authority. Notary Public 310855v2 MTN CL205.41 D-l STATE OF MINNESOTA ) ) ss. COUNTY OF ANOKA ) On this _ day of ,2007, before me, a Notary Public within and for said County, personally appeared , to me personally known, who, being by me duly sworn, did say that (s)he is the Executive Director of the Authority named in the foregoing instrument; that the seal affixed to said instrument is the seal of said Authority; that said instrument was signed and sealed in behalf of said Authority by authority of its governing body; and said acknowledged said instrument to be the free act and deed of said Authority. Notary Public 310855v2 MTN CL205-41 D-2