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THIRD AMENDMENT TO
CONTRACT FOR PRIVATE REDEVELOPMENT
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COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY, COLUMBIA HEIGHTS,
MINNESOTA, a public body corporate and politic (tile ``Authority''), established pursuant to
Mitnlesota Statutes, Sections 469.090 to 469.1081 (hereit•lafter referred to as the "Act"), and
GRAND CENTRAL PROPERTIES, LLC, a Mimlesota limited liability company (the
"Redeveloper").
WHEREAS, the Authority and New Heights Development, LLC entered into that certain
Contract for Private Redevelopment dated as of September 22, 2003, as amended by a First
Amendment thereto dated April 26, 2005 and by a Second Amendment thereto dated November 22,
2005 (the "Contract") providing far the redevelopment of certain property described as the
Redevelopment Property in the Contract and described in Schedule A attached hereto; and
WHEREAS, New Heights Development, LLC has changed its legal name to Grand Central
Properties, LLC but in all respects remains the Redeveloper under the Contract; and
WHEREAS, construction of the Housing Improvements and Connnercial Improvements has
been delayed far various reasons, anal the parties have detet•~nined a need to amend the Contract in
order to adjust the deadlines for completion and related matters.
N0~7~I, 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:
1. Sectionl.l of the Contract is amended to revise certain defnitions as follows:
"Available Tax Increment" means 90 percent of the Tax Increment attributable to the
Redevelopment Property (or relevant portion. thereof, as the context requires), received by the
Authority in the six-month period before any schedule payment date on any Note, or received prior
to the first payment date on any Note to the extel~t so provided in the resolution approving the Note.
"Holtsing Improvements" meals the construction. by the Redeveloper on the Housu7g Property
of the following owner-occupied housing units: at least 67 condominium units and 10 tovv~l homes
("Phase I"), at least 70 additional condomaliuln units ("Phase II"); and at least 70 additional
condomiluuln units and at Least 11 additional town homes ("Phase III").
2. Notwithstanding anything to the contrary in Section 3.4 of the Contract, the Note shall
be issued in accordance w~itl~ the resolution attached as Schedule B to this Third Amendment, which
supersedes in all respects Schedule B to the original Contract.
3. The pay-ties agree and understand that, as of the date of this Tlurd Amendment, the
Negotiation Period regarding the Collnnercial Period under Section 3.7 has expired, anal Sectiol~ 3.7
leas no further force or effect.
315304v3 SJB CL20~ ~0
4. The first paragraph. of Section 4.3 of the Contract is revised to read as follows:
As of the date of this Third Amendment, the parties agree and understand that Phase I of the
r .y
Housing Improvements has been substantially completed. Subject to unavoidable Dezays, one
Redeveloper must commence and substantially complete construction of the balance of the
Minimum hmprovements as follows:
Phase II Housing Improvements: Commence by April 1, 2009, substantially complete
by October 1, 2010.
Phase III Housing Improvements: Commence by July 1, 2009, substantially complete by
December 31, 2010.
Comm~erciallimprovements Commence by December 31, 2007, substantially
complete by December 31, 2009.
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 with he
Planning Contract. If the Redeveloper is malting substantial progress with respect to the
redeveloprment 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.
3. In Section 10.6, the notice address far Redeveloper is amended to read as follows:
Daivd Kloeber, Jr.
Grand Central Properties LLC
3080 Centerville Road
Little Canada, MN j5117
3I5304v3 S.iz3 CL20~-20 2
IN WITNESS WHEREOF, the Authority has caused this Amendment to be duly executed in
its name and behalf and its seal to be hereunto duly affixed alid the Redeveloper has caused this
Agreement to be duly executed in its name and behalf on or as of the date first above written.
STATE OF MINNESOTA }
SS.
COUNTY OF ANOKA }
COLUMBIA HEIGHTS~C-CQNOMIC
DEVELOPM NT AUT-IORIT~Y
~5
is President-C{.ay L. Peterson
w '~~ ~~%
By _
Its Executive Di c~or-Walter R. Fehst
The foregoing instrument was aclalowledged before me this ~-` day of ~ ,
2007, by Gary Peterson and Walter Fehst, the President and Executive Director of th Columbia
Heights Economic Developrrlent Authority, a public body politic and corporate, on behalf of the
Authority.
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f ~ - ~lairmi:
~',~ t~vco~-
Notary ublic
3I5304v3 SJB CL205-20
GRAND CENTIZ~ ~ RO;I''~RTIES, LLC
By
,_- r.
ItS ~~f~' ~;~,,.w
STATE OF MMESOTA }
} SS.
C;OITI`~1TY OF ~t~~ ~ ~ }
The foregolllg instrlunent was acknowledged before me this 4~ - ~~ day of c~ s,c ~~~
~" ( f" r ~" (`' ("e tr~ n
ZGG7 by ~~;;v,L~ W~ . ~i~~.~' ~ ~/ ~ the ~.~::~ ~ ,~z ~ z~y~ ~~ ~ _cf ~ratid n__~_ rorerties,
LLC, a Minnesota limited liability company, on behalf of the company.
31a304v3 SJB CI,205-20 4
SCHEDULE A
TO
THIRD AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT
Housing Property
[Insert current platted description]
Commercial. Property
[Insert current platted. description]
315304v3 SJB CL205-20 ~_
SCHEDULE B TO
THIRD AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO.
RESOLUTION AWARDING THE SALE OF, AND PROVIDING THE FORM, TERMS,
COVENANTS AND DIRECTIONS FOR THE ISSUANCE OF ITS TAXABLE TAX
INCREivIENT RE`JENIJE `dOTE, SEF.IES 2~~7A
BE IT RESOLVED BY the Board of Commissioners ("Board") ofthe Cohmlbia Heights
Economic Development Authority, Columbia Heights, Mirn~esota (the "Authority") as follows:
Section 1. Authorization• Award of Sale.
1.01. Authorization. The Authority and the City of Columbia Heights have heretofore
approved the establishment of the Kmart/Central Avenue Tax Increment Financing District (the
"TIF District"} the Downtown CBD Redevelopment Project (the "Project"), and Have adopted a
tax increment financing plan for the purpose of financing certain improvements within the
Project. h1 com~ection with the TIF District, the Authority entered into a Contract for Private
Recteveiopment between file Authority and New T-Ieigllts Development, LLC (now l~~o~,~an as
Grand Central Properties, LLC} dated as of September 22, 2004, as amended by a First
Amendment thereto dated as of April 26, 2005, a second amendment thereto dated as of
November 22, 2005, and a Third Amendment thereto dated as of 2007 (the
"Agreement").
Pursuant to Miiu~esota Statutes, Section 469.178, the Authority is authorized to issue and
sell its bonds for the purpose of financing a portion of the public development costs of the
Project. Such bonds are payable from all or any portion of revenues derived from the TIF
District and pledged to the payment of the bonds. The Authority hereby finds and determines that
it is in file best interests of the Authority that it issue ar~d sell its Taxable Tax Increment Revenue
Note in the maximum principal amount of $700,000 (the "Note"} for the purpose of financing
certain public redevelopment costs of the Project.
1.03. Issuance Sale. and Tei-~ns of the Note. The Authority hereby delegates to the
Executive Director the determination of the date on which the Note is to be delivered, in
accordance with the Agreement. The Note shall. be issued to Grand Central Properties, LLC
("Owner"). The Note shall be dated as of the date of delivery, shall mature no later than
February 1, 2013, shall bear interest at the rate of 6.0 % per annum from the date of original
issue of the Note, and shall be in the principal amount of the Public Redevelopment Costs
submitted and approved in accordance with the Agreement but in no event greater than
$700,000. The Note is issued uz consideration of pgyznent by Owner of the Public
315304v3 SJI3 CL,205-20 A-2
Redevelopment Costs in at least the principal. amount of the Note, in accordance with the
Agreement.
Section 2. F01711 of NOte. t~t1e Note S12all be 111 SU17Stantlaily 1118 lUlluwii2g lviu2, JJiiii u~~
blanks to be properly filled in and the principal amount and payment schedule adjusted as of the
date of issue:
UNITED STATE OF AMERICA
STATE OF MINNESOTA
COUNTY OF ANOKA
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
No. R-1 $
TAXABLE TAX INCREMENT REVENUE NOTE
SERIES 2007
Rate
6.0
Date
of Original Issue
2007
The Cohunbia Heights Economic Development Authority ("Authority"} for value
received, certifies that it is indebted and hereby promises to pay to Grand Central Properties,
LLC or registered assigns (the "Owner"), the principal sum. of $700,000 or so much thereof as
has been from time to time advanced (the "Principal Amount"), as provided in the Agreerr~ent
defined hereafter, together with interest on the unpaid balance thereof accrued from the date of
original issue hereof at the rate of 6.0 percent per annum (the "Stated Rate"). This Note is given
in accordance with that certain Contract far Private Redevelopment between the Issuer and the
Owner dated as of September 22, 2004, as amended by a First Amendment thereto dated as of
April 26; 2005, a second amendment thereto dated as of November 22, 2005, and a Third
Amendment thereto dated as of 2007 (the "Agreement"} and the authorizing
resolution (the "Resolution") duly adopted by the Authority on August 2007.
Capitalized teens used and not otherwise defined herein hav? the meaning provided for such
terms in the Agreement unless the context clearly requires otherwise.
1. Patents. Principal and interest ("Payments"} shall be paid on the first February
1 or August 1 after substantial completion. of all the Housing Improvements and Commercial
Improvements in accordance with the Agreement, and on each February 1 and August I
thereafter to anal including February 1, 2014 ("Payment Dates"}, ir7 the amounts and from the
sources set forth in Section 3 herein. Payments shall be applied first to accrued interest, and then
to unpaid principal.
Payments are payable by mail to the address of the Owner or such other address as tl~e
Owner may designate upon 30 days written notice to the Authority. Payments on this Nate are
315364v3 S.1F3 CL205-20 A-~
payable in any coin or currezzcy of the United States of America which, on the Payment Date, is
legal tender for the payment of public and private debts.
_r~i_~_ ~r~+..
2. Interest. Simple interest shall accrue from the date of original issue ui uus l~~~c
and shall be computed on the basis of a year of 360 days and charged for actual days principal is
unpaid.
3. Available Tax Increment. All payments on this Note are payable on each
Payment Date solely froze and u~ the amount of the "Available Tax hzerement," which means (a)
on the first Payment Date, 95 percent of the Tax Increment attributable to the I4ousing Property
as defined in the Agreement that has been paid to the Authority by Anoka County prior to that
Payment Date, al~d (b) on each Paylrent Date after the first I'aylnent Date, 95 percent of the Tax
Increment attributable to the I4ousilzg Property as defined in the Agreement that has been paid to
the Authority by Anoka County in the six months preceding the Payment Date.
The Authority shall have no obligation to pay principal of and interest on this Note on
each Payment Date from any source other than Available Tax Increment and the failure of the
Authority to pay the entire amount of principal or interest on this Note on any Payment Date
s11a11 not constitute a default hereunder as long as the Authority pays principal and interest
hereon to the extent of such pledged revenues. The Authority shall have no obligation to pay
unpaid balance of principal or accrued interest that may remain after the final Payment on
February 1, 2014.
4. Default. Upon an Event of Default by tl~e Redeveloper under the A.greeznent, the
Authority may exercise the remedies with respect to this Note described in Section 9.2 of the
Agreement, the terms of which are izicorporated herein by reference.
5. Optional Prepa zy Went. (a) The principal sum and all accrued interest payable
under this Note is prepayable in whole or in part at any time by the Authority without premium
or penalty. No partial prepayment shall affect the amow~t or timing of any other regular payment
ot1_~erwisP reoizzired to be made under this Note.
(b) Upon receipt by Redeveloper of the Authority's written statement of the Excess
Amount as defined izi Section 3.4(e) of the Agz°eement, one-half of such Excess Amount will be
deemed to constitute, and will be applied to, prepayment of the principal amount of this Note. Such
deemed prepayment is effective as of the Final Closing Date as defined in Section 3.4(e) of the
Agreement, and will be recorded by the Registrar in its records for the Note. Upon request of the
Ow7~zer, the Authority will deliver to the Owner a statement of the outstanding principal balance of
the Note after application of the deemed prepayment under this paragraph.
6. Nature of Obligation. This Note is one of an issue in the total principal amount of
$ issued to aid in financing certain public redevelopment costs and administz°ative
costs of a Project undertaken by the Authority pursuant to Minnesota Statutes, Sections 469.001
tluough 469.047, and is issued pursuant to t11e Resolution, and pursuant to and in fiz11 col~forlnity
with the Constitution and laws of tl~e State of Minnesota, including Minnesota Statutes, Scetiol~s
469.174 to 469.179. This Note is a limited obligation of the Authority which is payable solely
315304v3 sJI3 CL205-20 A_[~
from file revenues pledged to the payment hereof under the Resolution. Tlzis Note and the
interest hereon shall not be deemed to constitute a genes°al obligation of the State of Minnesota or
any political subdivision thereof, includil~g, without limitation, the Authority. Neither the State
,, ~i nr
of Mirnzesota, nor any political subdivision thereof shah be obiigatea to pay u e priaicipd~ ul or
interest on this Note or other costs incident hereto except from and to the extent of the revenues
pledged hereto, and neither the full faith and credit nor the taxing power of the State of
Mimlesota or any political subdivision thereof is pledged to file payment of the principal of or
interest on this Note or other costs incident hereto.
7. Registration and Transfer. This Note is issuable only as a fully registered note
without coupons. As provided in the Resolution, and subject to certain limitations set forth
therein., this Note is transferable upon the books of the Authority kept for that purpose at the
principal office of the City Finance Director, by tl~e Owner hereof in person or by such Owner's
attorney duly authorized in writing, upon surrender of this Note together with a written
instrument of transfer satisfactory to the Authority, duly executed by the Owner. Upon such
transfer or exchange and the payment by the Owner of any tax, fee, or governmental charge
required to be paid by the Authority with respect to such transfer or exchange, there will be
issued in the name of the transferee a new Note of the same aggregate principal amount, bearing
interest at the wane rate and maturing on the same dates.
This Note shall not be transferred to any person unless the Authority has been provided
with an opinion of counsel or a certificate of tine transferor, in a form satisfactory to the
Authority, that such transfer is exempt from registration and prospectus delivery requirements of
federal and applicable state securities laws.
IT IS HEREBY CER":GIFTED AND RECITED that ail acts, conditions, and things
required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen.,
and to be performed ill order to snake tlvs Note a valid and binding limited obligation of the
Authority according to its terms, have been done, do exist, have happened, and have been
performed in due form, time and manner as so required.
IN WITNESS WEIEREOF, the Board of Commissioners of the Columbia Heights
Economic Development Authority have caused this Nate to be executed with the manual
signatures of its President ai.d Executive Director, all as of tl~e Date of Original Issue specified
above.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
F,xecutive Director
President
REGISTRATION PROVISIONS
315304v3 S1B CL265-20 ~,_~
The ownership of the unpaid balance of the within Note is registered in the band register
of the City Finance Director, in the name of the person last listed below.
Date of Signature
of
Registration Registered Owner City Finance Director
Grand Central Properties, LLC
Federal Tax LD. No.
t' 2 Ter:~.s, F,xec~ation and Delivery.
Cvei ion ~.
3.01. Denomination Payment. The Note shall be issued as a single typewritten note
numbered R-1.
The Note shall be issuable only in fully registered form. Principal of aizd interest on the
Note shall be payable by checlt or draft issued by the Registrar described herein..
3.02. Dates• Interest Payment Dates. Principal of and interest on the Note shall be
payable by mail to the owner of record thereof as of the close of business on the fifteenth. day of
the month preceding tale Payment Date, whether or not such day is a business day.
3.1?3. Registration. The Authority hereby appoints the City Finance Director to perform
the functions of registrar, transfer agent and paying agent (the "Registrar"). T11e effect of
registration arzd the rights and duties of the Authority and the Registrar with respect thereto shall
be as follows:
(a) Re i~ ster. The Registrar shall keep at its office a bond register in which the
Registrar shall provide for the registration of ownership of the Note and the registration of
transfers and exchanges of the Note.
(b) Transfer of Note. Upon surrender for transfer of the Nate duly endorsed by the
registered owner thereof or accompanied by a written instrument of transfer, in form reasonably
satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly
authorized by the registered owner in writing, the Registrar shall authenticate and deliver, in the
name of the designated transferee or transferees, a new Note of a like aggregate principal amount
and maturity, as requested by the transferor. Notwithstanding the foregoing, the Note shall not
be transferred to any person unless the Authority has been provided with an opinion of counsel
or a certificate of the transferor, in a form satisfactory to the Authority, that such transfer is
exempt from registration and prospectus delivery requirements of federal and applicable state
securities laws. The Registrar may close the boobs for registration of any transfer after the
fifteenth day of the month preceding each Payment Date and until such Payment Date.
(c) Cancellation. The Note surrendered upon any transfer shall be promptly
cancelled by the Registrar and thereafter disposed of as directed by the Authority.
315304v3 SJI3 CL205-20 A_(
(d} Imt~roper or Unauthorized Transfer. When the Nate is presented to the Registrar
for transfer, the Registrar may refuse to transfer the salve until it is satisfied that tl7e endorsement
_i_ _77
on such Note or separate instrument of t1°ansfer is legally authorized. The icegislrar SI~a>~ incur
no liability for its refusal, i11 good faith, to make t7ansfers wlueh it, i11 its judgment, deems
improper or unauthorized.
(e) Persons Deemed Owners. The Authority and the Registrar may treat the person in
whose name the Note is at any time registered in the bond register as the absolute owner of the
Note, whether the Nate shall be overdue or not, far the purpose of receiving payment of, or on
account of, the principal of gild interest on such Note and for all other purposes, and all such
payiiients so made to any such registered owner or upon. the owner's order shall be valid and
effectual to satisfy and discharge the liability of the Authority upon such Note to the extent of the
sum or sums so paid.
(f) Taxes Fees and Charges. For every transfer or exchange of the Note, the
Registrar may impose a charge upon. the owner thereof sufficient to reimburse the Registrar for
any tax, fee, or other governmental charge required to be paid with respect to such transfer or
exchange.
(g) Mutilated Lost Stolen or Destroyed Note. In case any Note shall become
mutilated or be lost, stolen, or destroyed, the Registrar shall deliver a new Note of like amount,
maturity dates and tenor ill exchange and substitution for and upon cancellation of such mutilated
Nate or in lieu of and in substitution for such Note lost, stolen, or destroyed, upon the payment
of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case
the Note lost, stolen, or destroyed, upon filing with the Registrar of evidence satisfactory to it
that such Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing
to the Registrar of an appropriate bond or indemnity in form, substance, and amount satisfactory
to it, in which both the Authority and the Registrar shall be named as obligees. The Note so
surrendered to the Registrar shall. be cancelled by it aazd evidence of such cancellation shall be
given to tl~e Authority. If the mutilated, lost, stolen, or destroyed Note has already matured or
been called for redemption in accordance with its terms, it shall not be necessary to issue a new
Note prior to payment.
3.04. Preparation and Delivery. The Nate shall be prepared under the direction of the
Executive Director ai7d shall be executed on behalf of the Authority by the signatures of its
President and Executive Director. In case any officer whose signatilre shall appear on the Note
shall cease to be such officer before the delivery of the Note, such signature shall nevertheless be
valid and sufficient for all purposes, the same as if such officer clad remained in office until
delivery. When the Note has been so executed, it shall be delivered by the Executive Director to
the Owner thereof in accordance with the Agreement.
Section 4. Secui-it~Provisions.
4.01. Pledge. Tl~e Authority hereby pledges to the payment of the principal of and
interest on the Note all Available Tax Increment under d1e terms and as defined in the Note.
315304v3 SJB CL205-20 /~-~
Available Tax Inerelnent shall be applied to payment of the principal of alid interest on the Note
in accordance with the terms of the form of Note set forth in Section 2 of this resolution.
4.U~. 1301101 t'ullq. UI1t11 the date the 1VUte Is llo luiiger oi.t~~~aiiuui~ aiiu iio priu~.iNui
thereof or interest thereon (to the extent required to be paid pursuant to this resolution) remains
unpaid, the Authority shall maintain a separate and special "Bond Fund" to be used for 110
purpose other than the payment of the principal of and interest on the Note. The Authority
irrevocably agrees to appropriate to the Bond Fund in each year all Available Tax Increment.
Any Available Tax Increment remaining in the Bond Fund shall be transferred to the Authority's
account for the TIF District upon termination of the Nate in accordance with its terms.
~?.03. Additional Bo11ds. T_f the Authority issues any bonds or notes secured by
Available Tax Increment, such additional bonds or notes are subordinate to the Note i11 all
respects.
Section 5. Certification of Proceedings.
5.01. Certification of Proceedings. The officers of the Authority are hereby authorized
and directed to prepare and furnish to the Owner of the Note certified copies of all proceedings
and records of the Authority, and such other affidavits, certificates, and information as may be
required to show the facts relating to the legality and marketability of the Note as the same
appear from the books and records under their custody and control or as otherwise lcllown to
them, and all such certified copies, certificates, and affidavits, including any heretofore
furnished, shall be deemed representations of the Authority as to the facts recited therein.
Section 6. Effective Date. This resolution shall be effective upon approval.
Adopted this day of August, 2007.
President
Executive Director
315304v3 SJB CI.,205-2Q A_g