HomeMy WebLinkAboutEDA AGN 08-11-08 Special
CITY OF COLUMBIA HEIGHTS
590 40th Avenue N.E., Columbia Heights, MN 55421.3878 (763) 706.3600 TOO (763) 706.3692
Visil Our Website at: www.ci.columbia-heights.mn.us
AGENDA
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Monday, August 11, 2008 SPECIAL MEETING
6:15 p.m., City Hall, Conference Room 1
1. Call to Order/Roll Call
2. Pledge of Allegiance
3. Discussion-4ih & Central Redevelopment Agreement for
Retail and Office Construction
4. Adjournment
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)
jpecla ee In Q 0: UQus ,
AGENDA SECTION: Business Item ORIGINATING EXECUTIVE
NO: 3 DEPARTMENT:EDA DIRECTOR
APPROVAL
ITEM: Discussion-4ih & Central BY: Scott Clark BY:
Redevelopment Agreements for DATE: August 5,2008
Retail and Office Construction
S . 1M t'
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t 11 2008
BACKGROUND: In order to move the review process along, staff is sending the subject
"Fourth Amendment to Contract for Private Redevelopment" and the "Contract of Private
Redevelopment between the EDA and Grand Central Commons, LLC" to the EDA in two
phases. On August 11, 2008 the intent will be to: 1) Discuss the two agreements in regards to
recommended policy changes made from the original agreement approved on September 22,
2003 between the EDA and New Heights Development, LLC, commonly referred to as the
"Nedegaard Agreement"; and 2) Establish a general consensus on the two agreements so the
EDA can receive final documents on August 26, 2008 for review and final action. Approval of
some form of development agreement, coupled with the on-going work of building permit
review for the 51,000 sq. ft office and retail facility, and the private contract issuance for the
sanitary sewer expansion are the three components that must be finalized prior to a
construction start.
Historv: On September 22, 2003 the City's EDA approved a Contract for Private
Redevelopment Agreement (between the party stated in the introduction), which called for
$700,000 in tax increment assistance based on the completion of the housing condo project
(218 units) and a minimum 10,000 sq. ft. of commercial space. Since that time the original
developer has sold the project (new contract holder is Grand Central Properties, LLC), and in
turn, the new owner has bifurcated the project by selling the contractually defined commercial
piece to another entity (Grand Central Commons, LLC). The original agreement has two
sections which drives the current discussion: 1) The original agreement identified that the
developer of the commercial project would be entitled to negotiate for tax increment
assistance. Section 3.5 (attached) states that the EDA "will negotiate in good faith regarding
the amount... .". The rest of the section does stipulate that the assistance request must go
through the usual "but for" analysis to determine an appropriate level of assistance; and 2)
The other key issue in the original agreement is that the $700,000 is not issued until all of the
"Minimum Improvements" are completed, which includes 218 units of housing and 10,000 sq.
ft. of commercial. The agreements as presented, remove this requirement in order for the tax
increment to be immediately issued, and divides, by formula, between the new housing owner
and the commercial owner. The commercial owner will be using their portion of the tax
increment note as a source of funding for the sewer expansion work.
Fourth Amendment to Contract for Private Redevelopment
This amendment alters portions of the original September 22, 2003 agreement and as such,
affects both the "housing developer" and the "commercial developer."
The amendments contain the following key provisions:
1) Releases the $700,000 of tax increment financing for the housing development
(through a pay-as-you-go note) without the need to complete the remaining housing
phases, except as contractually stated, as a good faith effort.
2) The released $700,000 will be divided between the housing and the commercial
developer, with the latter using the proceeds to pay for the construction costs of the
sewer expansion.
3) Modifies the time line for the housing developers look back period.
4) Establishes the sanitary sewer obligations of the commercial developer to create a
new letter of credit that is currently being held by the housing developer.
5) Establishes a good faith effort for future housing phases. It is realistic to project that the
$700,000 note will be substantially paid off before the housing market is ready to
accept additional condominiums.
Contract for Private Redevelopment between the EDA & Grand Central Commons. LLC
This agreement is between the commercial developer and the EDA and establishes the
conditions of granting financial assistance.
The key provisions are:
1) Establishes the tax increment assistance amount. Staff is still finalizing the "but for"
analysis but the anticipated amount is $450,000.
2) Establishes a look-back provision
3) Memorializes the Met Council Grant in the amount of $974,369 and the process of
reimbursement for the ramp expenditures
4) Payment of Administrative Costs
5) Creates a completion of improvement date of December 31, 2009
6) Establishes a minimum assessment agreement
As stated in the beginning of the memorandum, the purpose of the August 11, 2008 special
meeting will be to discuss the policy and overall parameters of these agreements. If the EDA
Commissioners have any questions prior to the meeting please contact staff.
RECOMMENDATION: None
RECOMMENDED MOTION: None
Attachments: Section 3.5 of the original Contract for Private Redevelopment, Fourth Amendment to Contract for Private
Redevelopment, Contract for Private Redevelopment with Grand Cenlral Commons, LLC.
EDA ACTION:
Execution Copy
CONTRACT
FOR
PRIVATE REDEVELOPMENT
By and Between
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
COLUMBIA HEIGHTS, MINNESOTA
and
NEW HEIGHTS DEVELOPMENT, LLC
>.
This document was drafted by:
KENNEDY & GRAVEN, ChaIiered
470 Pillsbury Center
Milmeapolis, Minnesota 55402
Telephone: (612) 337-9300
SJB-235566v6
CL205-20
in connection with the TIP District or this Agreement are for the benefit of the Authority, and are
not intended as representations on which the Redeveloper may rely. If the Public Redevelopment
Costs exceed the principal amount of the Housing Note, such excess is the sole responsibiliy of
Redeveloper.
(e) Prepayment from Gross Profit. Within 60 days after closing on Redeveloper's sale to
third parties of the final unit of completed Housing Improvements (the "Final Closing Date"), the
Redeveloper must deliver to the Authority evidence of its Gross Profit on construction and sale of
the Housing Improvements under this Agreement. For the purposes of this Agreement, the term
"Gross Profit" is a percentage calculated as the aggregate proceeds from sales of each unit sold to
third parties ("Sale Proceeds"), less the total Development Cost, divided by total Sale Proceeds.
The term Development Cost means the sum of the following costs incuned by the
Redeveloper in connection with the Minimum Improvements: (1) the total purchase price paid or
payable by the Redeveloper for acquisition of the Redevelopment Property (without regard to
reimbursement thereof under the Note), including closing costs paid by the Redeveloper; (2) the
cost of constructing the Housing Improvements, including without limitation engineering, architect
fees, surveying, legal and similar soft costs; (3) costs of constmction financing for the Housing
Improvements, including loan fees, interest paid dming constmction, attorney fees, and any costs
paid by Redeveloper under Section 3.9 of this Agreement; and (4) closing costs on sale of lots to
third patties, including broker fees and commissions paid to third patties or to Redeveloper's sales
associates, all to the extent paid by the Redeveloper. The Authority or its agents shall be entitled to
review and audit the calculation of Gross Profit.
The amount by which Gross Profit exceeds fifteen percent is a percentage refened as
"Excess Profit." The Excess Profit, multiplied by the total Sale Proceeds, is the Excess Amount.
One half of the Excess Amount will be applied as prepayment of the outstanding principal amount
of the Note in accordance with the tellliS of Section 5(b) of the Note. Such event must be
evidenced by delivery by the Authority to the Redeveloper of a written notice stating the Excess
Amount. The one-half share of Excess Amount will be deemed prepaid as of the Final Closing
Date.
Section 3.5. Tax Increment Assistance for Connnercial Improvements. (a) Before
commencement of constmction of the Commercial Improvements, the AuthOlity and the
Redeveloper will negotiate in good faith regarding the amount, if any, of tax increment assistance
needed -to make development of the Commercial Improvements economically feasible. The
negotiation will commence upon presentation by the Redeveloper to the AuthOlity of a
development proforma for those improvements and other documentation reasonably required by the
Authority to justify the need for public assistance. In determining the amount, if any, of tax
increment assistance to be provided, the parties agree that the following principles will apply:
(i) the amount of assistance will depend upon the final detem1ination as to the
type and square footage of Commercial Improvements to be constmcted, and upon analysis
ofthe Redeveloper's pro forma and related documentation for that development plan;
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CL205-20
10
(ii) the pro forma must show that the tax increment assistance is solely in the
amount necessary to permit Redeveloper to develop the Commercial Property, or convey to
third parties for such development, at prevailing market prices for vacant urban property;
and
(iii) any assistance will be provided solely from Available Tax Increment
attributable to the Commercial Improvements and the Commercial Property, unless the
Authority determines in its sole discretion to make an additional pledge of Available Tax
Increment from the Housing Property (subordinate to the Housing Note).
(b) Failure of the parties to agree on the terms of tax increment assistance for the
Commercial Improvements will not relieve Redeveloper's obligation to construct such
improvements under Article N hereof.
Section 3.6. Issuance of Commercial Note. (a) If the parties negotiate an amount of tax
increment assistance under Section 3.5, the Authority will approve the Second Authorizing
Resolution to authorize issuance of the Commercial Note, contingent upon (i) the Authority having
determined that issuance of the Commercial Note does not constitute a "business subsidy" within
the meaning of the Business Subsidy Act, or (ii) the parties having negotiated the terms of a
business subsidy agreement and the Authority and City having approved such agreement after
public hearing in accordance with the Business Subsidy Act.
(b) The Commercial Note will be in a fOlm substantially similar to that set forth in the
Initial Anthorizing Resolution attached as Schedule B, provided that the Commercial Note will be
payable solely from the Available Tax Increment attributable to the Commercial Improvements and
the Commercial Property (subject to the optional additional pledge described in Section 3.5(a)(iii)
hereof). The Authority and the Redeveloper agree that the consideration from the Redeveloper for
the purchase of the Connuercial Note shall consist of the Redeveloper's payment of Public
Redevelopment Costs in connection with development of the Commercial Improvements. All other
terms of Section 3.4 apply to the Commercial Note by substituting the word "Commercial" for
"Housing" where it appears in that Section.
(c) The Authority's obligation to approve the Second Authorizing Resolution and issue the
Conmlercial Note are subject to the AuthOlity's legal authOlity to take such actions under the laws
existing at the time of such actions.
>.
Section 3.7. Future Connllercial Propelty. (a) For a peliod of twelve months after the date of
this Agreement (the "Negotiation Period"), the Redeveloper and Authority will negotiate in good faith
regarding development of the Future Commercial Property for uses and under tenus that are mutually
satisfactory to the parties. The AuthOlity and City agree that during the Negotiation Period, so long as
there is no uncured Event of Default by Redeveloper under this Agreement, they will not negotiate or
contract with any party other than Redeveloper concerning the development ofthe Future Commercial
Property.
(b) During the Negotiation Period, the Redeveloper will (i) use its best efforts to acquire all
parcels of the Future Commercial Property, (ii) negotiate a letter of intent with a substantial
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11
FOURTH AMENDMENT TO
CONTRACT FOR })RIV ATE REDEVELOPMENT
THIS AGREEMENT, made on or as of the _ day of 2008, 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"), am! GRAND CENTRAL PROPERTIES, LLC, a Minnesota 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 and a Third Amendment thereto dated August 28, 2007 (the "Contract") providing for 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, Redeveloper sold a portion of the Redevelopment Property defined as Outlot C
and Outlot D, Grant Central Lofts, Anoka County, Minnesota (which property constitutes the
Commercial Property as originally defined in the Contract); and
WHEREAS, Redeveloper also assigned to Grand Central COlmnons, LLC (the
"Commercial Redeveloper") certain obligations under the original Contract relating to construction
of the Commercial Improvements as defined therein, pursuant to an Assignment and Assumption
Agreement between Redeveloper and COlmnercial Redeveloper dated as of , 2007 (the
"Assignment"); and
WHEREAS, the Authority has determined to enter into a separate Contract for Private
Redevelopment with the Commercial Redeveloper (the "Commercial Contract") regarding the
Commercial Improvements, and has fiJrther determined to modifY the obligations of Redeveloper
regarding the I-lousing Improvements under the Contract.
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:
1. Sectionl.l of the Contract is amended to revise certain definitions as follows:
"Available Tax Increment" means 90 percent of the Tax Increment attributable to the
Housing Property received by the Authority in the six-month period before any schedule
payment date on the Housing Notes, or received prior to the first payment date on the Housing
Notes to the extent so provided in the resolution approving the Housing Notes.
"COlmnercial Improvements" has the meaning provided in the Commercial Contract
1
"Commercial Note" has the meaning provided in the Commercial Contract.
"Commercial Property" means as Outlot C and Outlot D, Grant Central Lofts, Anoka
County, Minnesota.
"Contract" mcans the Contract for Privatc Redevelopment between the Authority and
Redevcloper dated as of September 22, 2003, as amcnded by a First Amendment thereto datcd April
26, 2005 and by a Second Amendment thereto dated November 22, 2005 and by a Third
Amendment thereto datcd August 28, 2007, and by this Fourth Amendment.
"Fourth Amendment" means this Fomth Amendment to the Contract.
"Housing Improvements" means the construction by the Redeveloper on the Housing
Property of the following owner-occupied housing units: at least 67 condominium units and 10
town homes ("Phase I"), at least 70 additional condominium units ("Phase II"); and at least 70
additional condominium units and at least 11 additional town homes ("Phase III").
"I-lousing Property" means
"Minimum Improvements" means the I lousing Improvemcnts.
"Sewer Improvements" means the portion of the Public Improvements described in Section
5 of this Fourth Amendment.
2. Section 3.4 is modified to read as follows:
Section 3.4. Issuance of Housing Notes. (a) Terms. In order to reimburse the Redeveloper
for a portion of the Public Redevelopment Costs incurred by Redeveloper in connection with the
Housing Improvements, the Authority shall issue the Housing Notes in the principal amount of
$700,000. The Housing Notcs will be payable solely ii'om the Available Housing Tax Increment
attributable to the Housing Improvcments and the Housing Property. The terms of the Housing
Notes, induding maturity, payment dates and interest rate, will be substantially those set forth in the
form of the Housing Note shown in Schedule B hereto (which supersedes Schedule B to the Third
Amendment to the Contract). The Housing Notes will be dated as of August 1,2008, and interest
will accrue from such datc.
(b) Issuance. The parties acknowledge that Redeveloper has submitted and Authority has
approved Redeveloper's Public Redevelopment Costs in the amount of at least $700,000 in
accordance with Section 3.4(b)of the original Contract, but that the Housing Notes have not been
issued and delivered. The parties further agree that, in consideration of assumption by Commercial
Redeveloper of the obligation to construct the Sewer Improvements describcd in Section 5 of tins
Fomth Amendment, Redeveloper hereby assigns it right, title and interests in a portion of the
principle amount of the Housing Notes to Commercial Redeveloper. The portion assigned to
Commercial Redeveloper (referred to as the "Commercial Redeveloper POltion) equals the lesser of
(1) 50% of the total cost of the Sewer Improvements (induding design, engineering, construction
2
costs and the cost of all bonds and security required by the City), and (2) $350,000. The portion
retained by the Redeveloper (referred to as the Housing Redeveloper Portion) is $700,000 less the
Conunercial Rcdeveloper Portion. Accordingly, the I-lousing Notes shall be issued as two notes,
one issued to the Redeveloper in the principal amount ofthe Housing Redcveloper POliion, and onc
issued to the Commercial Redeveloper in the principal amount of the Commercial Redeveloper
Portion. The Housing Notes shall be issucd as soon as reasonably practicable after approval ofthe
authorizing resolution set forth in Schedulc B, and upon Redeveloper and Commercial Redeveloper
having delivered to the Authority an investment letter in substantially the form attached as Schedule
C hereto.
(c) Prepayment Fom Gross Profit. Within 60 days after closing on Redeveloper's sale to
third parties of the final unit of completed Phasc I ofthe I-lousing Improvements (the "Final Closing
Date"), thc Redeveloper must deliver to the Authority evidence of its Gross Profit on construction
and sale of Phase I under this Agreement. For the purposes of this Agreement, the term "Gross
Profit" is a percentage calculated as the aggregate proceeds fl'om sales of each unit sold to third
parties ("Sale Proceeds"), less the total Development Cost, divided by total Sale Proceeds.
The tcrm Development Cost means the sum of the following costs incurred by the
Redeveloper in connection with the Minimum Improvements: (I) the total purchase price paid or
payable by the Redeveloper for acquisition of the Redevelopment Property (without rcgard to
reimbursement thereof under the Note), including closing costs paid by the Redeveloper; (2) the
cost of constructing Phase I, including without limitation enginecring, architcct fees, surveying,
legal and similar soft costs; (3) costs of construction financing for Phase I, including loan fees,
interest paid during construction, attorney fees, and any costs paid by Redeveloper under Section
3.9 of this Agreement; and (4) closing costs on sale oflots to third parties, including broker fees and
commissions paid to third parties or to Redeveloper's sales associates, all to the extent paid by the
Redeveloper. The Authority or its agents shall be entitled to review and audit the calculation of
Gross Profit.
The amount by which Gross Profit exceeds fifteen percent is a percentage referred as
"Excess Profit." The Excess Profit, multiplied by the total Sale Proceeds, is the Excess Amount.
One half of the Excess Amount will be applied as prepayment of the outstanding principal amount
of the Housing Notcs in accordance with the terms of Section 5(b) of the each I-lousing Note. Such
event must be evidenced by delivery by the Authority to the Redeveloper of a written notice stating
the Excess Amount. The one-half share of Excess Amount will be deemed prepaid as of the Pinal
Closing Date.
3. Sections 3.5, 3.6 and 3.7 ofthe Contract are deleted.
4. In accordance with Section 3.9 of the Contract, Redeveloper acknowledges its
continued responsibility to pay Administrative Costs reasonably allocated to the Housing Property
and the Housing Improvements, including without limitation all Administrative Costs related to tllis
Pourth Amendment and to issuance of both Housing Notes. The Authority acknowledges that
Redeveloper has no liability for Administrative Costs reasonably allocated to the Commercial
Property and the Commercial Improvemcnts, including without limitation costs related to the
Commercial Contract and issuance ofthe Commercial Note.
3
5. The Authority acknowledges that Commercial Redeveloper will assume the
obligation to construct, at its cost, the oversized sanitary sewer mains necessary to provide adequate
capacity for the all the developer described in the original Contract (such work being referred to as
the "Sewer Improvements," and also representing a p0l1ion of the Public Improvements as defined
in Section 4.1 of the original Contract and in the Planning Contract). The Redeveloper will be
released from all further obligations regarding the Sewer Improvements under this Agreement upon
(a) execution in fi.1ll of the Commercial Contract, and (b) receipt by the City from the Commercial
Redeveloper of a letter of credit, in a form reasonably satisfactOlY to the City, in the amount
required by thc City to secure construction of the Sewer Improvements and any other public
improvcments described in the Commercial Contract, and (c) Commercial Redeveloper having
entered into a new planning contract with the City rcgarding construction of the Sewer
Improvement and any other public improvements required in connection with the Commercial
Improvements. Upon satisfaction of these condition for release, the Authority will cause the City to
release the outstanding letter of credit held by the City to secure Redeveloper's obligations under
the original Planning Contract, except that the City will be entitled to retain any portions of the letter
of credit needed to secure Public Improvements other than the Sewer Improvements that are not
completed as of the date of this Agreement.
6. The first paragraph of Section 4.3 of the Contract is revised to read as follows:
As of the date of this Fourth Amendment, the parties agree and understand that Phase I of the
I-lousing Improvements has been substantially completed. The Redeveloper must use its best
efforts to commence and substantially complete construction of the Phase II Housing
Improvements and Phase III Housing Improvements in accordance with Article IV hereof,
provided that failure to commence or complete those improvements is not an Event of Default
hereunder so long as Redeveloper demonstrates good faith efforts to accomplish that goal. All
work with respect to the Housing 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.
7. Any modification ofthe Contract that materially affects the amount or timing of
Available Tax Increment pledged to the Housing Notes requires written consent of the Commercial
Redeveloper.
4
IN WITNESS WHEREOF, the Authority has eaused this Amendment to be duly exeeuted
in its name and behalf and its seal to be hereunto duly affixed and the Redeveloper has eaused this
Agreement to be duly exeeuted in its name and behalf on or as of the date first above written.
COLUMBIA HEIGHTS ECONOMIC
DEVELOPMENT AUTHORITY
By
Its President
By
Its Exeeutive Direetor
STATE OF MINNESOTA )
) SS.
COUNTY OF ANOKA )
The foregoing instrument was aeknowledged before me this _ day of
2008, by Gary Peterson and Walter Fehst, the President and Exeeutive Direetor of the Columbia
Heights Eeonomic Development Authority, a public body politic and corporate, on behalf of the
Authority.
Notary Public
5
GRAND CENTRAL PROPERTIES, LLC
By
Its
STATE OF MINNESOTA )
) SS.
COUNTY OF )
The foregoing instrument was acknowledged before me this _ day of
, 2008 by , the of Grand
Central Properties, LLC, a Minnesota limited liability company, on behalf of the company.
Notary Public
6
CONSENT OF COMMERCIAL REDEVELOPER
The undersigned consents to the foregoing Fourth Amendment to Contract for Private
Redevelopment between the Columbia Heights Economic Development Authority and Grand
Central Properties, LLC.
GRAND CENTRAL COMMONS LLC
By
Its
STATE OF MINNESOTA )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before mc this _ day of
2008 by , the of Grand Central Commons LLC,
a Minnesota limited liability company, on behalf of the company.
Notary Public
7
SCHEDULE B TO
FOURTH AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO.
RESOLUTION APPROVING FOURTH AMENDMENT TO CONTRACT FOR
PRIVATE REDEVELOPMENT AND
AWARDING THE SALE OF, AND PROVIDING THE FORM, TERMS, COVENANTS
AND DIRECTIONS FOR THE ISSUANCE OF ITS TAXABLE TAX INCREMENT
REVENUE NOTES, SERIES 200SA
BE IT RESOLVED BY the Board of Commissioners ("Board") of the Columbia Heights
Economic Development Authority, Columbia Heights, Minnesota (thc "Authority") as follows:
Section 1. Authorization: Award of Sale.
1.01. Authorization. The Authority and the City of Columbia Hcights have heretofore
approved the establishment of the Kmart/Central Avenue Tax Increment Financing District (the
"'I'll' 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. In cOlmection with the TIF District, the Authority entered into a Contract for Private
Redevelopment between the Authority and New Heights Development, LLC (now known 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, a Third Amendment thereto dated as of August 28, 2007 and intends to
enter into a Fourth Amendment thereto referenced below (collectively, the "Agreement").
Pursuant to Minnesota 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 the best interests of the Authority that it issue and sell its Taxable Tax Increment Revenue
Notes in the principal amount of $700,000 (the "Notes") for the purposc of financing certain
public redevelopment costs of the Project.
1.02. AODl'oval of Contract Amendment. The Fourth Amendment to Contract for Private
Redevelopment between the Authority Grand Central Properties, LLC ("Grand Central
Properties") is approved in substantially the form on file in City Hall, subject to modifications
that do not alter the substance of the transaction that are approved by the President and Executive
Director, provided that execution of the amendment by such officials is conclusive evidence of
and their approval.
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1.03. Issuance, Sale, and Terms of the Notes. The Authority hereby delegates to the
Executive Director the determination of the date on which the Notes are to be delivered, in
accordance with the Agrcement. The Notes shall be issued as follows: one Note in the original
principal amount of the I-lousing Redeveloper Portion issued to Grand Ccntral Properties; and
onc Note in the original principal amount of the Commercial Redeveloper Portion issued to
Grand Central Commons, LLC ("Grand Central Commons"), as such terms are defined in, and
all in accordance with, the Agreement (Grand Central Properties and Grand Central Commons
being referred to as the "Owner" or "Owners"). The Notes shall be dated August I, 2008, shall
mature no later than February I, 2014, and shall bear interest at the rate of 6.0 % per annum from
the date of original issue of the Note. The Notes are issued in consideration of payment by
Grand Central Properties of the Public Redevelopment Costs in at least the principal amount of
the Notes, in accordance with the Agreement.
Section 2. Form of Note. The Notes shall be in substantially the following form,
numbered R-I and R-2, with the blanks to be properly filled in as of the date of issue:
UNITED STATE OF AMERICA
STATE OF MINNESOTA
COUNTY OF ANOKA
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
No.R-
$
TAXABLE TAX INCREMENT REVENUE NOTE
SERIES 2007
Rate
Date
of Original Issue
6.0%
August 1,2008
The Columbia Heights Economic Development Authority ("Authority") for value
received, certifies that it is indebted and hereby promises to pay to or
registered assigns (the "Owner"), the principal sum of $ (the "Principal Amount"), as
provided in the Agreement defined hereafter, together with interest on the unpaid balance thereof
accrued ii'om 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 for Private Redevelopment
between the Issuer and New Heights Development, 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, a Third Amendment thereto dated as of August 28, 2007 and a
Fourth Amendment thereto dated as of , 2008 (the "Agreement") and the authorizing
resolution (the "Resolution") duly adopted by the Authority on August , 2008.
Capitalized terms used and not otherwise defined herein have the meaning provided for such
terms in the Agreement unless the context clearly requires otherwise.
A-2
1. Pavments. Principal and interest ("Paymcnts") shall be paid in installments
commencing February 1,2010 and continuing on each February 1 and August 1 thereafter to and
including February 1, 2014 ("Payment Dates"), in 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 the
Owner may designate upon 30 days written notice to the Authority. Payments on this Notc are
payable in any coin or currency of the United States of America which, on the Payment Date, is
legal tender for the payment of public and private debts.
2. Interest. Simple interest shall accrue from the date of original issue of this Note
and shall be computed on the basis of a year of360 days and chargcd for actual days principal is
unpaid.
3. Available Tax Increment. All payments on this Note are payable on each
Payment Date solely from and in the amount of the "Available Tax Increment," which means (a)
on the tirst Payment Date, 90 percent of the Tax Increment attributable to the Housing Property
as defined in the Agreement that has been paid to the Authority by Anoka County prior to that
Payment Date, and (b) on each Payment Date after thc tirst Payment Date, 90 percent of the Tax
Increment attributable to the Housing Property as detined in the Agreement that has been paid to
the Authority by Anoka County in the six months preceding the Payment Date.
The Authority shall havc 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
shall 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 tinal Payment on
February 1,2014.
4. Default. Upon an Event of Default by the Redeveloper under the Agreement, the
Authority may exercise the remedies with respect to this Note described in Section 9.2 of the
Agreement, the terms of which are incorporated herein by reference.
5. Optional Prepayment. (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 amount or timing of any other regular payment
otherwise required to be made under this Note.
(b) Upon receipt by Redeveloper of the Authority's written statement of the Excess
Amount as defined in Section 3.4(c) of the Agreement, one-half of such Excess Amount will be
deemed to constitute, and will be applied to, prepayment of the principal amount ofthis Note. Such
deemed prepayment is efTective as of the Final Closing Date as defined in Section 3.4(c) of the
Agreement, and will be recorded by the Registrar in its records for the Note. Upon request of the
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Owner, the Authority will deliver to the Owner a statemcnt of thc outstanding principal balance of
the Note after application of the decmed prepayment under this paragraph.
6. Nature of Obligation. This Note is one of an issue in the total principal amount of
$700,000 issued to aid in financing certain public redevelopment costs and administrative costs
of a Project undertaken by the Authority pursuant to Minnesota Statutes, Sections 469.001
through 469.047, and is issued pursuant to the Resolution, and pursuant to and in full conformity
with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections
469.174 to 469.179. This Note is a limited obligation of the Authority which is payable solely
from the revenues pledged to the payment hereof under the Resolution, each Note issued under
the Resolution being on parity with the other. This Note and the interest hereon shall not be
deemed to constitute a general obligation of the State of Minnesota or any political subdivision
thereof, including, without limitation, the Authority. Neither the State of Minnesota, nor any
political subdivision thereof shall be obligated to pay thc principal of 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 Minnesota or any political
subdivision thereof is pledged to the payment of the principal of or interest on this Note or other
costs incident hcreto.
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 transfcrable upon the books of the Authority kcpt for that purpose at the
principal oHice ofthc City Finance Dircctor, by the 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 thc Authority, duly executed by the Owner. Upon such
transfer or exchange and the payment by the Owner of any tax, fec, or governmental charge
required to be paid by thc Authority with respect to such transfer or cxchange, there will be
issued in the name of the transferee a new Note of the same aggrcgate principal amount, bearing
interest at thc same rate and maturing on the same dates.
This Note shall not be transfcrred to any person unless the Authority has bcen provided
with an opinion of counselor 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.
IT IS HEREBY CERTIFIED AND RECITED that all 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 in order to make this 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 manncr as so required.
IN WITNESS WHEREOF, the Board of Commissioners of the Columbia Hcights
Economic Development Authority have caused this Note to be executed with the manual
signatures of its President and Executive Director, all as of the Date of Original Issue specified
above.
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COLUMBIA HEIGl-ITS ECONOMIC DEVELOPMENT AUTHORITY
Executive Director
President
REGISTRATION PROVISIONS
The ownership of the unpaid balance of the within Note is registered in the bond register
of the City Finance Director, in the name of the person last listed below.
Date of
of
Registration
Signature
Registered Owner _
City Finance Director
Federal Tax J.D. No.
Section 3.
Terms. Execution and Delivery.
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 and interest on the
Note shall be payable by check or draft issued by the Registrar described herein.
3.02. Dates: Interest Pavment 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 the Payment Date, whether or not such day is a business day.
3.03. Registration. The Authority hereby appoints the City Finance Director to perform
the functions of registrar, transfer agent and paying agent (the "Registrar"). The effect of
registration and the rights and duties of the Authority and the Registrar with respect thereto shall
be as follows:
(a) Register. 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 ofthe Note.
(b) Transfer of Note. Upon surrender for transfer of the Note duly endorsed by the
registered owner thereof or accompanied by a written instrument of transfer, in form reasonably
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satisfactory to thc 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 books for registration of any transfer after the
fifteenth day ofthc 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.
(d) Improper or Unauthorized Transfer. When the Note is presented to the Registrar
for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement
on such Note or separate instrument of transfer is legally authorized. The Registrar shall incur
no liability for its refusal, in good faith, to make transfers which it, in 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 Note shall be overdue or not, for the purpose of receiving payment of, or on
account of, the principal of and interest on such Note and for all other purposes, and all such
payments 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 suflicient 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 in exchange and substitution for and upon cancellation of such mutilated
Note 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 and evidence of such cancellation shall be
given to the 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.
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3.04. Prcparation and Deliverv. The Note shall be prcpared under the direction of thc
Executive Director and shall be executed on bchalf of the Authority by the signatures of its
President and Executive Director. In casc any officer whose signature shall appear on the Note
shall ceasc to be such officer before the delivery of the Notc, such signature shall nevertheless be
valid and sutlicient for all purposes, the same as if such otlicer had remained in otlice until
dclivery. When the Note has been so executcd, it shall be delivered by the Executive Director to
the Owner thereof in accordance with the Agreement.
Section 4. Securitv Provisions.
4.0 I. Pledge. The Authority hercby pledges to the payment of the principal of and
interest on the Notese all Available Tax Increment under the terms and as defined in the Note.
Available Tax Increment shall be applied to payment of the principal of and interest on the
Notes, each Note being on parity with the other, in accordance with the tcrms of the form of Note
set forth in Section 2 ofthis resolution.
4.02. Bond Fund. Until the date the Note is no longer outstanding and no principal
thereof or interest thereon (to the extent requircd to be paid pursuant to this resolution) remains
unpaid, the Authority shall maintain a separatc and spccial "Bond Fund" to be used for no
purpose othcr than thc payment of the principal of and intcrest on the Note. The Authority
irrevocably agrees to appropriate to the Bond Fund in each ycar 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 ofthe Note in accordance with its terms.
4.03. Additional Bonds. If the Authority issues any bonds or notes secured by
Available Tax Increment, such additional bonds or notes are subordinatc to the Notes in 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 thcir custody and control or as otherwise known to
them, and all such certified copies, certificates, and affidavits, including any heretofore
furnished, shall be deemed representations ofthe Authority as to the facts recited therein.
Section 6. Effective Date. This resolution shall be effective upon exccution of the
Fourth Amcndment to the Agreement.
Adopted this _ day of August, 2008.
President
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Executive Director
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SCHEDULE C
INVESTMENT LETTER
To the Columbia Heights Economic Development Authority (Authority)
Attcntion: Executive Director
Re:
$
Tax Increment Revenue Note, Series 2008
The undersigned, as Purchaser of the above captioned Note (Note) pursuant to a resolution
of the Authority adopted on , 2008 (Resolution), hereby represents to you and to
Kelmedy & Graven, Chattered, Minneapolis, Minnesota, Bond Counscl, as follows:
1. We understand and acknowledge that the Note is delivered to the Purchaser as of
this date pursuant to the Resolution and the Contract for Private Redevelopment between the
Authority and New Heights Development, LLC dated as of Scptember 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, a Third Amendmcnt thercto dated as of August 28, 2007 and a Fourth
Amendment thereto dated as of , 2008 (Contract).
2. The Note is payable as to principal and interest solely fi'om Available Tax Increment
as defined in the Note. The Purchaser understands and acknowledges that the Authority makes no
representations or warranties regarding the amount of Available Tax Increment, or that revenues
pledged to the Note will be sufficient to pay the principal and interest on the Note. Any estimates of
Tax Increment prepared by the Authority or its financial advisors in comlection with the TIF
District, the Note or the Contract are for the benefit of the Anthority, and are not intended as
representations on which the Purchaser may rely.
3. We have sufficient knowledge atld experience in financial and business matters,
including purchase and ownership of municipal obligations, to be able to evaluate the risks and
merits of the investment represented by the purchase of the above stated principal amount of the
Note.
4. We acknowledge that no offering statement, prospectus, offering circular or other
comprehensive offering statement containing material information with respect to the Authority and
the Note has been issued or prepared by the Authority, and that, in due diligence, we have made our
own inquilY and analysis with respect to the Authority, the Note and the security therefor, and other
material factors affecting the security and payment of the Note.
5. We acknowledge that we have either been supplied with or have access to
information, including financial statements and other financial information, to which a reasonable
investor would attach significance in making investment decisions, and we have had the opportunity
to ask questions and receive answers from knowledgeable individuals concerning the Authority, the
Note and the security therefor, and that as a reasonable investor we have been able to make our
decision to purchase the above stated principal amount of the Note.
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6. We have been informed that the Note (i) is not being registered or otherwise
qualified for sale under the "Blue Sky" laws and regulations of any state, or under federal securities
laws or rcgulations, (ii) will not be listed on any stock or other securities exchange, and (iii) will
carry no rating ii'om any rating service.
7. We acknowledge that neither the Authority nor Kennedy & Graven, Charted has
made any reprcsentations as to the status of interest on the Note for statc or federal income tax
purposes.
8. We represent to you that we are purchasing the Note for our own accounts and not
for resale or other distribution thereof, except to the extcnt otherwise provided in the Note or the
Resolution.
9. All capitalized terms used hcrein have the meaning provided in the Contract unless
the context clearly requires otherwise.
10. The Purchaser's federal tax identification number is
II. We acknowledge receipt ofthe Note on the date hereof.
[NAME OF PURCHASER]
By
Its
Dated:
,2008.
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Second Draft July 31,2008
CONTRACT
FOR
PRIVATE REDEVELOPMENT
By and Betwccn
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
COLUMBIA HEIGHTS, MINNESOTA
and
GRAND CENTRAL COMMONS LLC
Dated as of:
,2008
This document was drafted by:
KENNEDY & ORA VEN, Chartered
470 US Bank Plaza
Minneapolis, Minnesota 55402
Telephone: (612) 337-9300
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 4.1.
Section 4.2.
Section 4.3.
Section 4.4.
Section 5.1.
Section 5.2.
Section 6.1.
Section 6.2.
TABLE OF CONTENTS
.........................................................................................................................1
ARTICLE I
Definitions
Defini ti ons....................................................................................................... 3
ARTICLE II
Representations and Warranties
Representations by the Authority.................................................................... 7
Representations and Warranties by the Redeveloper......................................7
ARTICLE III
Property Acquisition, Conveyance and Financing
Status of the Property......................................................................................9
Environmental Conditions..............................................................................9
Public Redevelopment Costs..........................................................................9
Issuance of Commercial Note......................................................................... 9
Met Council Grant ........................................................................................11
Payment of Administrative Costs .................................................................11
Records........................................................................................................ .12
No Business Subsidy.................................................................................... .12
ARTICLE IV
Construction of Minimum Improvements and Public Improvements
Construction of Minimum Improvements and Public Improvements ..........13
Construction Plans....................................................................................... .13
Completion of Construction......................................................................... .14
Certificate of Completion............................................................................ .15
ARTICLE V
Insurance
Insurance...................................................................................................... .16
Subordination............................................................................................... .17
ARTICLE VI
Tax Increment; Taxes
Right to Collect Delinquent Taxes................................................................18
Review of Taxes ...........................................................................................18
Section 6.3.
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 10.1 O.
Section 10.11.
SCHEDULE A
SCHEDULE B
SCHEDULE C
SCHEDULE D
SCHEDULE E
SCHEDULE F
Assessment Agreement................................................................................ .18
ARTICLE Vll
Financing
Mortgage Financing..................................................................................... .19
ARTICLE V111
Prohibitions Against Assignment and Transfer; Indemnification
Representation as to Redevelopment........................................................... .20
Prohibition Against Redeveloper's Transfer of Property and
Assignment of Agreement........................................................................... .20
Rclease and Indemnification Covenants .......................................................22
ARTICLE IX
Events of Default
Events of Default Defined........................................................................... .23
Remedies on Default.................................................................................... .23
No Remedy Exclusive.................................................................................. .24
No Additional Waiver Implied by One Waiver............................................24
Attorney Fees............................................................................................... .24
ARTICLE X
Additional Provisions
Conflict ofInterests; Authority Representatives Not Individually Liable....25
Equal Employment Opportunity.................................................................. .25
Restrictions on Use...................................................................................... .25
Provisions Not Merged With Deed...............................................................25
Titles of Articles and Sections ......................................................................25
Notices and Demands................................................................................. ..25
Counterparts................................................................................................. .26
Recording..................................................................................................... .26
Amendment.......................................................... .... ......................... ........... .26
Authority or City Approvals .........................................................................26
Termination. .............. ........................................... ....................................... ..26
Description of Commcrcial Property
Authorizing Resolution
Ccrtification of Completion
Invcstment Lettcr
Assessment Agreement
Pro Forma
ii
CONTRACT FOR PRIVATE REDEVELOPMENT
THIS AGREEMENT, made on or as of the day of ,
2008, by and bctween COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY,
COLUMBIA HEIGHTS, MINNESOTA, a public body corporatc and politic (the "Authority"),
established pursuant to Minnesota Statutes, Sections 469.090 to 469.1081 (hereinafter referred to
as the "Act"), and GRAND CENTRAL COMMONS LLC, a Minnesota limited liability
company (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 undertaken a program to promote
redevelopment ofland which that is characterized by blight and blighting factors within the City,
and in this connection the Authority administers a redevelopment project known as the
Downtown CDn Redcvelopment Project ("Project") pursuant to Minnesota Statutes, Sections
469.001 to 469.047 (the "HRA Act"); and
WHEREAS, pursuant to the Act and thc HRA Act, thc Authority is authorized to acquire
real property, or interests therein, and to undertake certain activities to facilitate the
redevelopment of real property by private enterprise; and
WHEREAS, within the Project, the City and Authority have created the Kmart/Central
Avenue Tax Increment Financing District ("TIF District") in order to facilitate redevelopment of
certain property in the Project; and
WHEREAS, the Authority and New Heights Development, LLC ("Housing
Redeveloper") 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 thcreto dated November 22, 2005 and a Third Amendment thereto dated
August 28, 2007 (the "Housing Contract") providing for the redevelopment of certain property
described as the Redevelopment Propcrty in the Contract; and
WHEREAS, New Heights Development, LLC has changcd its legal name to Grand
Central Properties, LLC but in all respects remains the Housing Redeveloper under the Housing
Contract; and
WHEREAS, Housing Redeveloper sold a portion of the Redevelopment Property under
the Housing Contract, which portion is described in Schedule A hereto and is referred to herein
as the "Commercial Property;" and
I
WHEREAS, I-lousing Redeveloper also assigned to Redeveloper certain obligations under the
Housing Contract relating to construction of the Commercial Improvements as defined therein,
pursuant to an Assignment and Assumption Agreement between Redeveloper and Commercial
Redeveloper dated as of , 2007 (the "Assignment"); and
WHEREAS, the Authority and Housing Redeveloper have entered into a Fourth Amendment to
the Housing Contract, addressing the remaining obligations of those parties regarding the
Housing Improvements as defined therein; and
WHEREAS, the Authority has determined to enter into this Agreement with the
Redeveloper regarding the Commercial Improvements to be constructed on the Commercial
Property; and
WHEREAS, the Authority believes that the redevelopment of the Commercial Property
pursuant to this Agreement, and fulfillment generally of this Agreement, are in the vital and best
interests of the City and the health, safety, morals, and welfare of its residents, and in accord
with the public purposes and provisions of the applicable State and local laws and requirements
under which the Project has been undertaken and is 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:
2
ARTICLE I
Definitions
Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears
from the context:
"Act" means thc Economic Development Authority Act, Minnesota Statutes, Sections
469.090 to 469.108, as amended.
"Affiliate" means with respect to the Redeveloper (a) any corporation, partnership,
corporation or other business entity or person controlling, controlled by or under common
control with the Redeveloper, and (b) any successor to such party by merger, acquisition,
reorganization or similar transaction involving all or substantially all of the assets of such party
(or such Affiliate). For the purpose hereof the words "controlling", "controlled by" and "under
common control with" shall mean, with respect to any corporation, partnership, corporation or
other business entity, the ownership of fifty percent or more of the voting interests in such entity
possession, directly or indirectly, of the power to direct or cause the direction of managcment
policies of such entity, whethcr ownership of voting securities or by contract or otherwise.
"Agreement" means this Agrccment, as the samc may bc from time to time modified,
amended, or supplemented.
"Authority" means the Columbia Heights Economic Developmcnt Authority, or any
successor or assign.
"Authority Representative" means the Executive Director of the Authority, or any person
dcsignated by the Executive Dircctor to act as the Authority Representative for the purposes of
this Agreement.
"Authorizing Resolution" means the resolution of the Authority, substantially in thc form
of attached Schedule B to authorize the issuance of the Commercial Note.
"A vailablc Tax Incrcment" means 90 percent of the Tax Increment attributable to the
Commercial Property (or relcvant portion thereof, as the context requires), received by the
Authority in the six-month period before any schedule payment date on any Note.
"Business Day" means any day cxcept a Saturday, Sunday, legal holiday, a day on which
the City is closed for business, or a day on which banking institutions in the City are authorized
by law or executive order to close.
"Business Subsidy Act" means Minnesota Statues, Sections 116J.993 to 116J.995, as
amended.
3
"Certificate of Completion" means the certification provided to the Redeveloper, or the
purchaser of any part, parcel or unit of the Commercial Property, pursuant to Section 4.4 of this
Agreement.
"City" means the City of Columbia Heights, Minnesota.
"Commercial Improvements" means the construction on the Commercial Property of at
least 51,000 square feet of retail, office or service facilitics that are permitted or conditional uses
for such site under the City zoning ordinance.
"Commercial Note" means the Tax Increment Revenue Note substantially in the form
contained in the Authorizing Resolution, issued in accordance with Section 3.4 hereof.
"Construction Plans" means the plans, specifications, drawings and related documents on
the construction work to be performed by the Redeveloper on the Commercial Property 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: (I) site plan; (2) foundation plan; (3) basement plans; (4) Uoor plan
for each Uoor; (5) cross sections of each (length and width); (6) elevations (all sides); (7)
landscape plan; and (8) such other plans or supplements to the foregoing plans as the Authority
may reasonably request to allow it to ascertain the nature and quality of the proposed
construction work.
"Commercial Property" means the property so described on Schedule A..
"County" means the County of Anoka, Minnesota.
"Event of Default" means an action by the Redeveloper listed III Article IX of this
Agreement.
"Grant" means the grant from the Metropolitan Council described III the Grant
Agreement.
"Grant Agreement" means the Metropolitan Livable Communitics Act Livable
Communities Demonstration Account Grant Agreement between the Metropolitan Council and
the City dated February 9, 2007
"Holder" means the owner of a Mortgage.
"Housing Contract" means
"I-lousing Improvements" has the meaning provided in the Housing Contract.
"Housing Notes" means the Taxable Tax Increment Revenue Notes issued under the
Housing Contract.
4
"Housing Redeveloper" means Grand Central Properties, LLC.
"Minimum Improvements" means the Commercial Improvements and the Parking Ramp.
"Mortgage" means any mortgage made by the Redeveloper which is secured, in whole or
in part, with the Commercial Property and which is a permitted encumbrance pursuant to the
provisions of Article VIII ofthis Agreement.
"Note" means either the I-lousing Notes or the Commercial Note, or both, as the context
requires.
"Parking Ramp" means the structured parking facility to be constructed on the
Commercial Property containing at least 210 stalls.
"Planning Contract" has the meaning provided in Section 4.1 (b) hereof.
"Public Improvements" has the meaning provided in Section 4.1 (b) hereof.
"Public Redevelopment Costs" has the meaning provided in Section 3.3 hereof.
"Redeveloper" means Grand Central Commons LLC or its permitted successors and
assigns.
"Redevelopment Project" means the Authority's Downtown CDB Redevelopment
Project.
"Redevelopment Plan" means the Authority's Redevelopment Plan for the
Redevelopment Project, as amended.
"Sewer Improvements" has the meaning provided in Section 4.1 (b) hereof.
"State" means the State of Minnesota.
"Tax Increment" means that portion of the real property taxes which is paid with respect
to the Commercial Property and which is remitted to the Authority as tax increment pursuant to
the Tax Increment Act. The term Tax Increment does not include any amounts retained by or
payable to the State auditor under Section 469.177, subd. 11 of the Tax Increment Act, and does
not include any amounts defined as tax increment under Section 469.174, subd. 25, clauses (2),
(3), (4) and (5) of the TIF Act.
"Tax Increment Act" means the Tax Increment Financing Act, Minnesota Statutes,
Sections 469.174 to 469.1799, as amended.
"Tax Increment District" or "TIF District" means the Authority's Kmart/Central Avenue
Tax Increment Financing District.
5
"Tax Increment Plan" or "TIF Plan" means the Authority's Tax Increment Financing
Plan for the TIF District, as approved by the Authority on September 16, 2003 and by the City on
September 22, 2003, and as it may be amended from time to time.
"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 court, the
tax court of the State, or the State Supreme Court.
"Termination Date" means the date the Authority receives the last installment of Tax
Increment from the County.
"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, terrorism, strikes, other labor
troubles, fire or other casualty to the Minimum 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.
6
ARTICLE II
Representations and Warranties
Section 2.1. Representations by the Authority. 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 property which for a variety of reasons is presently underutilized, to eliminate
blighting factors and prevent the emergence of further blight at a critical location in the City, to
create increased tax base in the City, to increase commercial activity and to stimulate further
development of the TIF District and Redevelopment Project as a whole.
Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper
represents and warrants that:
(a) The Redeveloper is a limited liability company duly organized and in good
standing under the laws of the State of Minnesota, is not in violation of any provisions of its
article of organization or the laws of the State, is duly authorized to transact business within the
State, has power to enter into this Agreement and has duly authorized the execution, delivery and
performance of this Agreement by proper action of its members.
(b) The Redeveloper will construct, operate and maintain the Minimum
Improvements in accordance with the terms of this Agreement, the Redevelopment Plan 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 in the Project Area may
be or will be in violation of any environmental law or regulation (other than those notices or
communications of which 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 construct the Minimum Improvements in accordance with
all local, state or federal energy-conservation laws or regulations.
(e) The Redeveloper will obtain, in a timely manner, all required permits, licenses
and approvals, and will meet, in a timely manner, all requirements of all applicable local, state
and federal laws and regulations which must be obtained or met before the Minimum
Improvements may be lawfully constructed.
7
(1) Neither the execution and delivery of this Agreemcnt, the consummation of the
transactions contemplated hercby, nor the ful1illmcnt of or compliancc with the terms and
conditions of this Agreement is preventcd, limited by or conflicts with or rcsults in a breach of,
thc terms, conditions or provisions of any partnership or company restriction or any evidences of
indebtedness, agreement or instrument of whatever nature to which the Redeveloper is now a
party or by which it is bound, or constitutes a default under any of the foregoing.
(g) Whenever any Event of Default occurs and if thc Authority or the City shall
employ attorneys or incur other expenses for the collection of payments due or to bccome due or
for the enforcement of performancc or observancc of any obligation or agreement on the part of
the Redeveloper under this Agreement, and the Authority or the City or prevails in such action,
the Redeveloper agrees that it shall, within ten days of written demand by the City, pay to the
City the reasonable fees of such attorneys and such other expenses so incurred by the City.
(h) The Redeveloper shall promptly advise City 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.
(i) The proposed redevelopment by the Redeveloper hereunder would not occur but
for the tax increment financing assistance being provided by the Authority hereunder.
(j) The Redeveloper is not currently in default under any business subsidy agreement
with any grantor, as such terms are defined in the Business Subsidy Act.
8
ARTICLE III
Propcrtv Acquisition. l'arldnl!: Ramp Financinl!:
Section 3.1. Status of the Propertv. As of the date of this Agreement, the Redeveloper
has acquired the Commercial Property from the Housing Redeveloper. The Authority has no
obligation to acquire the Commercial Property or any portion thereof.
Section 3.2. Environmental Conditions. (a) The Redeveloper acknowledges that the
Authority makes no representations or warranties as to the condition of the soils on the
Commercial Property or the fitness of such property for construction of the Minimum
Improvements or any other purpose for which the Redeveloper may make use of such property,
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 Commercial Property nor
imposes any obligation on such parties to participate in any cleanup of such property.
(b) Without limiting its obligations under Article VIII 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, fi'Oll1 any claims or actions
arising out of the presence, if any, of hazardous wastes or pollutants existing on or in the
Commercial Property, unless and to the extent that such hazardous wastes or pollutants are
present as a result of the actions or omissions of the indemnitees. Nothing in this section will be
construed to limit or aflect any limitations on liability of the City or Authority under State or
federal law, including without limitation Minnesota Statutes Sections 466.04 and 604.02.
Section 3.3. Public Redevclopment Costs. The Redeveloper shall construct the Parking
Ramp in accordance with Article IV hereof. All costs of construction of the Parking Ramp are
referred to as the "Public Redevelopment Costs". The Authority will assist in financing the
Public Redevelopment Costs in part through issuance of the Commercial Note under Section 3.4
hereof, and in part through proceeds of the Grant under Section 3.5.
Section 3.4. Issuance of Commercial Note. (a) Terms. In order to reimburse the
Redeveloper for a portion of the Public Redevelopment Costs incurred by Redeveloper, the
Authority shall issue and the Redeveloper shall purchase the Commercial Note in the maximum
aggregate principal amount of $ . The Commercial Note will be payable solely from
Available Tax Increment. The terms ofthe Commercial Note, including maturity, payment dates
and interest rate, will be substantially those set forth in the form of the Commercial Note shown
in Schedule B. The Commercial Note will be dated as of the date of delivery, and interest will
accrue from such date.
(b) Issuance. Before issuance and delivery of the Commercial Note, Redeveloper
must submit to the Authority one or more certificates signed by the Redeveloper's duly
authorized representative, containing the following: (i) a statement that each cost identified in the
certificate is a Public Redevelopment Cost incurred on or in connection with the Parking Ramp
and that no part of such cost has been included in any previous certification under this Section, or
9
reimbursed or requested to reimbursed from Grant proceeds under Section 3.5; (ii) evidence that
each identified Public Redevelopment Cost has been paid or incurred by or on behalf of the
Redeveloper, and (iii) a statement that no uncured Event of Dcfault by thc Redeveloper has
occurred and is continuing under the Agreement. The Authority may, if not satisfied that the
conditions described herein have been met, return any certificate with a statement of the reasons
why it is not acceptablc and requesting such further documentation or clarification as the
Authority may reasonably require. The Authority will deliver the Commercial Notc upon receipt
and approval of certificates evidencing Public Redevelopment Costs in at least the principal
amount of the Commercial Note, and Redeveloper having delivcred to the Authority an
investment letter in substantially the form of Schedule D.
(c) Termination of right to Commercial Note. Notwithstanding anything to the
contrary in this Agreement, if the conditions for delivery of the Commercial Note are not met by
July _, 2009 (which is the date of expiration of the "five year rule" for the 'I'll' District under
Section 469. I 763 of the TIP Act), the Authority may terminate the Commercial Note by ten days
written notice to the Redeveloper. Thereafter neither party shall have any obligations or liability
to the other hereunder, except that any obligations of thc Redeveloper under Sections 3.2, 3.6
and 8.3 survive such termination.
(d) Qualifications. The Rcdeveloper understands and acknowledges that the
Authority makes no representations or warranties regarding the amount of Available Tax
Increment, or that revenues pledged to the Commercial Note will be sufficient to pay the
principal and interest on the Commercial Note. Any estimates of Tax Increment prepared by the
Authority or its financial advisors in connection with the TIP District or this Agreement are for
the benefit of the Authority, and are not intended as representations on which the Redeveloper
may rely. If the Public Redevelopment Costs exceed the principal amount of the Commercial
Note and proceeds of the Grant, such excess is the sole responsibility of Redeveloper.
( e) Reduction of Assistance. The financial assistance to the Redeveloper under this
Agreement is based on certain assumptions regarding likely costs and expenses associated with
constructing the Commercial Improvements. The Authority and the Redeveloper agree that
those assumptions will be reviewed at the times described in this Section, and that the amount of
Commercial Note will be adjusted accordingly.
(i) Definitions. For the purposes of this Section, the following terms have the
following definitions:
"Calculation Date" means 60 days ailer the earliest of (i) the date of Stabilization;
(ii) the date of any Transfer in whole or in part of the Commercial Property or (iii) three
years ailer the date of issuance of the Certificate of Completion for the Commercial
Improvements.
"Net Operating Income" means all net rental income from the Commercial
Improvements received in the last fiscal year prior to the Calculation Date, subject to the
following adjustments: (i) if the Commercial Improvements have not reached
Stabilization as of the Calculation Date, income will be calculated as the sum of actual
10
net rcnt plus assumed rent for the spacc needed to reach 95% Icase-up at rates equal to
the average rent from actual leases as of the Calculation Date; (ii) from that total will be
deducted non-reimbursable expenses (e.g., common area maintenance charges, insurancc
and taxes) allocated to the actual vacant area (if Stabilization has occurred) or allocated to
the assumed 5% vacant area (if Stabilization has not occUl'red); and (iii) from that total
will also be deducted a structUl'al reserve in the amount of $.10 pcr square foot of the
Commercial Improvemcnts.
"Stabilization" means 95% of leaseable spacc in thc Commercial Improvemcnts is
leased.
"Target Yield" means a Yield on Total Project Costs of 12%.
"Total Project Costs" means all costs incUl'red by Redeveloper in connection with
the Commercial Improvements as of the Calculation Date, including the cost of acquiring
the Commercial Property, on-and-off-site improvemcnts benefiting the Commercial
Property, leasing commissions, capitalized interest on all such costs, and operating
deficits, and all other hard related soft costs incUl'red in connection with the Commercial
Improvements, net of (i) the principal amount of the Commercial Note and the Housing
Note, (ii) proceeds from Transfer of any undeveloped portion of the Commercial
Property.
"Yield on Total Project Costs" means Net Operating Income divided by Total
Project Costs.
(ii) Lookback Calculation. Upon the Calculation Date, the Redeveloper must
delivcr to thc Authority reasonable evidence of its Yield on Total Project Costs calculated
as of the Calculation Date, determined in accordance with generally accepted accounting
principles ("GAAP") and substantially in the format of the lookback pro forma attached
as Schedule _ hercto (except that if definitions in this Section vary from GAAP, the
provisions of this Section control). The Redeveloper agrees to provide to the Authority's
consultant any background documentation related to the financial data, upon request.
The Authority may request a written certificate of a certified public accountant regarding
Total Project Costs and Net Operating Income, to be provided at Redeveloper's expense
(which expense may be included as part of Total Project Costs).
If the Yield on Total Projcct Costs exceeds the Target Yield, the portion of Net
Operating Income in excess of the amount that produces the Target Yield is referred to as
the "Excess Amount." On the Calculation Date, 50% of the Excess Amount will be
applied to reduce the outstanding principal amount of the Commercial Note in
accordance with the terms of Section 5(b) of the Note. Such event must be evidenced by
delivery by the Authority to the Redeveloper of a written notice stating the Excess
Amount. The one-half share of Excess Amount will be deemed prepaid as of the
Calculation Date.
II
Section 3.5. Met Council Grant. (a) As further assistance to make development of the
Minimum Improvements economically feasible, the City will payor reimburse Redeveloper for
up to $974,369 in costs of the Parking Ramp, from and to the extent of proceeds of the Grant in
accordance with all the terms and conditions of the Grant Agrcement. Proceeds of the Met
Council grant will be disbursed in accordance with a disbursing agreement in a form mutually
agreed by the City, the Authority and the Developer. The parties agree and understand that the
disbursing agreement will set forth procedures for draw requests consistent with the terms of this
Section and the Grant Agreement. The disbursing agreement may be executed by Authority and
City officials subject to approval by the Mayor, Authority President and Authority Executive
Director, provided that execution of the agreement by those officials will be conclusive evidence
of their approval.
(b) Developer shall comply with all terms and conditions of thc Grant Agreement as
if Developer were grantec. Without limiting the forgoing, Developer shall:
(i) ensure that all contracts and subcontracts related to the Parking Ramp
costs funded by the Grant comply with all applicablc State and federal laws, including
applicable State and fcderal Occupational Safety and Health Act regulations;
(ii) meet all requirements of federal and State law relating to storm water
discharges, including without limitation, any applicable requirements of title 40, CFR,
parts 122 and 123;
(iii) acknowlcdge the assistance provided by the Metropolitan Council in
promotional materials, press releases, reports and publications relating to development of
the Commercial Property, which acknowledgement must contain the following language:
Financing for this project was provided by the Metropolitan Council Metropolitan
Livable Communities Fund and by the Columbia Heights Economic Development
Authority. Such statement shall also be included on signs located on the Commercial
until substantial completion of all Minimum Improvements constructed thereon.
Section 3.6. Payment of Administrative Costs. The Redeveloper is responsible for
"Administrative Costs," which means out-of-pocket costs incurred by the Authority attributable
to or incurred in connection with the negotiation and preparation of this Agreement and other
documents and agreements in connection with the Commercial Property. In order to secure
payment of the Administrative Costs, the Redeveloper has dclivered to the Authority cash or a
certified check in the amount of $ upon execution of this. The Authority will utilize
such funds to payor reimburse itself for Administrative Costs. If at anyone or more times
during the term of this Agreement, the Authority determines that Administrative Costs will
exceed $ and that additional sccurity is required, the Authority shall notify the
Redeveloper of the amount of such additional security. Within ten calendar days of receipt of
such notice, the Redeveloper shall deliver to the Authority the required additional security.
Section 3.7. Records. The Authority or its rcpresentatives shall have the right at all
reasonable times after reasonable notice to inspect, examine and copy all books and records of
Redeveloper relating to the Minimum Improvements.
12
Section 3.8. No Business Subsidy. The Redeveloper warrants and represents that its
investment in the purchase of the Commercial Property (which occurred in 2007) will equal at
least 70% of the County assessor's estimated market value of the Commercial Property for the
2007 assessment year, calculated as follows:
Commercial Property cost..............................................................$
2007 Assessor's Estimated Fair Market Value
of Commercial Property.......................................................................$
Cost equals
% of market value.
Accordingly, the parties agree and understand that the financial assistance described in
this Agreement does not constitute a business subsidy within the meaning of the Business
Subsidy Act, pursuant to Section 1161.993, subd. 3(17) thereof. Notwithstanding anything to the
contrary in Section 8.3 (b) hereof, 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 indemnify and hold harmless the
Authority and the City and the governing body members, oi1icers, agents, servants and
employees thereof against any claim arising from application of the Business Subsidy Act to this
Agreement, including without limitation any claim from any person or entity that the Authority
failed to comply with the Business Subsidy Act with respect to this Agreement.
13
ARTICLE IV
Construction of Minimum Imllrovcments and Pnblic Imllrovemcnts
Section 4.1. Construction of Minimum Improvements and Public Improvements. (a) The
Redeveloper agrees that it will construct or cause construction of the Minimum Improvements on
the Commercial Property, in accordance with approved Construction Plans and at all times while
Redeveloper owns the Commercial 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.
(b) The Redeveloper must prepare plans and specifications for and construct (I) the
oversized sanitary sewer mains necessary to provide adequate capacity for both the Commercial
Improvements under this Agreement and the Housing Improvements under the Housing Contract
(the "Sewer Improvements"); and (2) any streets and associated traffic improvements, sewer,
water, storm sewer improvements, sidewalks, landscaping, open space and related amenities
located within or serving the Commercial Property (the "Other Infl'astructure"). The Sewer
Improvements and Other Infrastructure are referred to together as the "Public Improvements."
Before commencing such construction, the Redeveloper must enter into a planning contract with
the City (the "Planning Contract"), addressing City requirements for construction of the Public
Infrastructure and security therefore in accordance with City ordinances and procedures.
Redeveloper must submit plans and specifications regarding the Public Improvements for
approval by the City substantially in accordance with procedures for Construction Plans
described in Section 4.2. All work on the Public Improvements shall be in accordance with the
approved construction plans and shall comply with all City requirements regarding such
improvements. The parties agree and understand that the City will accept the improvements in
accordance with City procedures and the Planning Contract.
Section 4.2. Construction Plans. (a) Before commencement of construction of the
Minimum Improvements, the Redeveloper shall submit to the Authority Construction Plans. The
Construction Plans shall provide for the construction of the Minimum Improvements and shall be
in conformity with the TIF Plan, Redevelopment Plan, this Agreement, the Planning Contract
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 fl'om 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 Building Of1icial 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 Development
Plan, applicable federal, state and local laws, ordinances, rules and regulations, or to construct
14
the Minimum Improvements in accordance thcrewith. 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 10 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 10 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 unreasonably withhcld,
delayed or conditioned. Said approval shall constitute a conclusive determination that the
Construction Plans (and the Minimum Improvements constructed in accordance with said plans)
comply to the Authority's satisfaction with the provisions ofthis Agreement relating thereto.
(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 Scction 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 part, by written
notice by the Authority to the Redeveloper, setting forth in detail the reasons therefor. Such
rejection shall be made within ten (10) 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. Subjcct to Unavoidable Delays, the
Redeveloper must commence construction of the Minimum Improvements by , 2008,
and must substantially complete construction of the Minimum Improvcments by December 31,
2009. All work with respect to the Minimum Improvements to be constructed or provided by the
Redevcloper on the Commercial Property shall be in substantial conformity with the
Construction Plans as submitted by the Redcveloper and approved by the Authority, and with he
Planning Contract. 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.
The Redeveloper agrees for itself: its successors and assigns, and every successor in
interest to the Commercial Property, or any part thereof: that the Redeveloper, and such
successors and assigns, shall promptly begin and diligently prosccute to completion the
redevelopment of the Commercial Property through the construction of the Minimum
Improvements thereon, and that such construction shall in any event be commenced and
completed within the period specified in this Section 4.3 of this Agreement. Subscquent to
conveyance of the Commercial Property, or any part thereof: to the Redeveloper, and until
15
construction of the Minimum Improvements has been completed, the Redevelopcr shall make
reports, in such detail and at such times as may reasonably be requestcd by the Authority, as to
the actual progress of the Redeveloper with respect to such construction.
Section 4.4. Certificate of Completion. (a) Promptly after substantial completion of the
Minimum Improvements (and each component thereof) 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 thereot), the Authority will furnish the
relevant Redeveloper with a Certificate of Completion in substantially thc form attached as
Schedule C. Such certification by the Authority shall be a conclusive determination of
satisfaction and termination of the agreements and covenants in the Agreement with respect to
the obligations of the Redcveloper, and its succcssors and assigns, to construct the relevant
component of the Minimum Improvemcnts and the dates for thc completion thereof. Such
certification and such determination shall not constitute cvidence of compliance with or
satisfaction of any obligation of the Redeveloper to any Holder of a Mortgage, or any insurer of a
Mortgage, securing money loaned to finance the Minimum Improvements, or any part thereof.
(b) Each Certificate of Completion provided for in this Section 4.4 ofthis Agreement
shall be in such form as will enable it to be recordcd in the proper office for the recordation of
deeds and other instruments pertaining to the Commercial Property. Ifthe 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 Redevcloper,
provide the Redeveloper with a written statement, indicating in adequate detail in what respects
the Redeveloper has failed to complete the Minimum Improvcments in accordancc with the
provisions of the Agrcement, or is otherwise in default, and what measures or acts it will be
necessary, in the opinion of the Authority, for thc Redcveloper to take or perform in order to
obtain such certification.
(c) The construction of the Minimum Improvements shall be deemed to be
substantially completcd when the Redeveloper has receivcd a certificate of occupancy for all
Commercial Improvements (except for any tenant build-outs), and the Parking Ramp and all site
improvements have been substantially completed as reasonably determined by the Authority
Representative.
16
ARTICLE V
Insurance
Section 5.1. Insurance. (a) The Redevcloper will provide and maintain at all times
during the proccss of constructing the Minimum Improvements an All Risk Broad Form Basis
Insurance Policy and, from time to time during that pcriod, at the request of the Authority,
furnish the Authority with proof of payment of premiums on policies covering the following:
(i) Builder's risk insurancc, written on thc so-called "Builder's Risk
Completed Value Basis," in an amount equal to one hundred percent (100%) of the
insurable value of thc Minimum Improvements at the date of completion, and with
covcrage available in nonreporting form on the so-called "all risk" form of policy. The
interest of the Authority shall be protectcd 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 propcrty damage of not less than $1,000,000 for each occurrence (to
accomplish the above-required limits, an umbrella excess liability policy may be used);
and
(iii) Workers' compensation insurance, with statutory coverage.
(b) All insurancc required in Article V of this Agrecment shall be taken out and
maintaincd in responsible insurance companics selected by the Redeveloper which are
authorized under the laws of the State to assume the risks covered thercby. Upon request, the
Redeveloper will deposit annually with the Authority policies evidcncing all such insurance, or a
certificate or certificates or binders of the respective insurers stating that such insurance is in
force and effect. Unless otherwise provided in this Article V of this Agreement each policy shall
contain a provision that the insurer shall not cancel nor modify it in such a way as to reduce the
coverage provided below the amounts required herein without giving written notice to the
Redeveloper and the Authority at least thirty (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 certificate or certificates of the
respective insurers as to the amount of coverage in force upon the Minimum Improvements.
(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
17
apply the net proceeds of any insurance relating to such damage received by the Redeveloper to
the payment or reimbursement of the costs thereof.
The Redeveloper shall complete the repair, reconstruction and restoration of the
Minimum Improvements, 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, construction and restoration shall be the property of the
Redeveloper.
(d) The Redeveloper and the Authority agree that all of the insurance provisions set
forth in this Article V shall terminate upon the termination of this Agreement.
Section 5.2. Subordination. Notwithstanding anything to the contrary contained in this
Article V, the rights of the Authority with respect to the receipt and application of any proceeds
of insurance shall, in all respects, be subject and subordinate to the rights of any lender under a
Mortgage approved pursuant to Article VII of this Agreement.
18
ARTICLE VI
Tax Increment: Taxes
Section 6.1. Rig.ht to Collect Delinquent Taxes. Thc Redeveloper acknowledges that the
Authority is providing substantial aid and assistance in furtherance of the redevelopmcnt
described in this Agrcement, in part through issuance of the Commercial Note. The Redeveloper
understands that the Tax Increments pledged to payment of the Commercial Note are derived
from real estate taxes on the Minimum Improvements, which taxes must be promptly and timely
paid. To that cnd, the Redeveloper agrees for itselt~ its successors and assigns, in addition to the
obligation pursuant to statute to pay rcal estate taxes, that it is also obligatcd by reason of this
Agreement to pay before delinquency all real estate taxes assessed against thc Commercial
Property and the Minimum Improvements. The Rcdeveloper acknowledges that this obligation
creates a contractual right on behalf of the Authority through 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. Thc Redeveloper agrees that prior to the Termination
Date, it will not cause a reduction in thc real property taxes paid in respect of the Commcrcial
Property through: (A) willful destruction of the Commercial Property or any part thereof; or (B)
willful refusal to reconstruct damaged or destroyed property pursuant to Scction 5.1 of this
Agreement. The Redeveloper also agrees that it will not, prior to the Termination Date, apply
for a deferral of property tax on the Commercial Property pursuant to any law, or transfer or
permit transfer of the Commercial Property to any entity whose ownership or operation of the
property would rcsult in the Commercial Property being exempt from real estate taxes under
State law (other than any portion thereof dedicated or conveyed to the City or Authority in
accordance with this Agreement).
Section 6.3. Assessment Ag.reement. (a) Prior to issuance ofthe Commercial Note, the
Redeveloper shall, with the Authority, exccute an Assessment Agreemcnt pursuant to Minnesota
Statutes, Section 469.177, subd. 8, specifying an assessor's minimum Market Value for the
Commercial Property and Minimum Improvements constructed thereon. The amount of the
minimum Market Value shall be $ of January 2, 2010 and each January 2
thereafter, notwithstanding the status of construction by such dates.
(b) The Assessment Agreement shall be substantially in the form attached hereto as
Schedule E. Nothing in the Assessment Agreement shall limit the discretion of thc assessor to
assign a market value to the property in excess of such assessor's minimum Market Value. The
Assessment Agreement shall remain in force for the period specified in the Assessment
Agreement.
19
ARTICLE VII
Financine:
Section 7.1. Mortgage Financing. (a) Before the Redeveloper's Closing Date, the
Redeveloper shall submit to the City evidence of one or more commitments for financing which,
together with committed equity for such construction, is sufficient for payment of the Minimum
Improvements. Such commitments may be submitted as short term financing, long term
mortgage financing, a bridge loan with a long term take-out financing commitment, or any
combination of the foregoing.
(b) If the Authority finds that the financing is sufficiently committed and adequate in
amount to pay the costs specified in paragraph (a) then the Authority shall notify the
Redeveloper in writing of its approval. Such approval shall not be unreasonably withheld and
either approval or rejection shall be given within twenty (20) days from the date when the
Authority is provided the evidence of financing. A failure by the Authority to respond to such
evidence of financing shall be deemed to constitute an approval hereunder. If the Authority
rejects the evidence of financing as inadequate, it shall do so in writing specifying the basis for
the rejection. In any event the Redeveloper shall submit adequate evidence of financing within
ten (10) days after such rejection.
( c) In the event that there occurs a default under any Mortgage authorized 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 Mortgage
documents. In the event there is an event of default under this Agreement, the Authority will
transmit to the Holder of any Mortgage a copy of any notice of default given by the Authority
pursuant to Aliicle IX of this Agreement.
(d) 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.
Notwithstanding anything to the contrary herein, any subordination agreement must include the
provision described in Section 7. I (c).
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ARTICLE VIII
Prohibitions Ae:ainst Assie:nment and Transfer: Indemnification
Section 8.1. Representation as to Redevelopment. The Redeveloper represents and
agrees that its purchase of the Commercial Property, and its other undertakings pursuant to the
Agreement, are, and will be used, for the purpose of redevelopment of the Commercial Property
and not for speculation in land holding.
Section 8.2. Prohibition Against Redeveloper's Transfer of Property and Assignment of
Agreement. The Redeveloper reprcsents and agrees that until issuance of the Ccrtificate 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 creatcd 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 Commercial 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 ofthe 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 Redcveloper or any successor in intercst to the Commercial Property or to construct
the Minimum Improvements or component thereof, or (ii) any lease, license, easement or similar
arrangement entered into in the ordinary course of business related to operation of the Minimum
Improvements.
(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:
(1) any proposed transferee shall have the qualifications and financial
responsibility, in the reasonable judgment of the Authority, necessary and adequate to
fulfill the obligations undertaken in this Agrecment by the Redeveloper as to the portion
ofthe Commercial Property to be transferred; and
(2) 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 thc portion of the Commercial Property to be transferred and agreed to
be subject to all the conditions and restrictions to which the Redeveloper is subject as to
such portion; provided, however, that the fact that any transferee of, or any other
successor in interest whatsoever to, the Commercial Property, or any part thereof, shall
not, for whatever reason, have assumed such obligations or so agreed, and shall not
(unless and only to the extent othcrwise specifically provided in this Agreement or agreed
to in writing by the Authority) deprive the Authority of any rights or remedies or controls
21
with respect to the Commercial 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 Commercial
Property or any part thereof, or any interest therein, however eonsummated or oecurring,
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 Commercial 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, no sueh transfer or approval by the
Authority thereof shall be deemed to relieve the Redeveloper, or any other party bound in
any way by this Agreement or otherwise with respeet to the Commercial Property, fl-om
any of its obligations with respect thereto.
(3) Any and all instruments and other legal documents involved in effecting
the transfer of any interest in this Agreement or the Commercial 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 then the Transfer will be
approved and the Redeveloper shall be released from its obligation under this Agreement, as to
the portion of the Commercial Property that is transferred, assigned, or otherwise conveyed. The
provisions of this paragraph (c) apply to all subsequent transferors, assuming compliance with
the terms of this Article.
(d) Upon issuance of the Certificate 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 property without the prior written consent of the Authority;
provided that:
(i) until the Termination Date the transferee or assignee is bound by all the
Redeveloper's obligations hereunder with respect to the property and rights transferred.
The Redeveloper shall submit to the Authority written evidence of any such transfer or
assignment, including the transferee or assignee's express assumption of the
Redeveloper's obligations under this Agreement. If the Redeveloper fails to provide sueh
evidence of transfer and assumption, the Redeveloper shall remain bound by all
obligations with respect to the subject property under this Agreement; and
(ii) upon compliance with clause (d)(i) above (whether the transfer occurred
before or after issuance of the Certificate of Completion), the Redeveloper shall be
released from its obligations under this Agreement with respect to the property
transferred.
The provisions of this paragraph (d) apply to all subsequent transferors, assuming compliance
with the terms ofthis Article.
22
( e) Nothing in this Article VIII will be construed to require, as a condition for release
of the Redeveloper hereunder or otherwise, that purchasers of any unit assume any obligations of
the Redeveloper. Upon sale of any residential unit to an initial owner-occupant, the Authority
will provide to Redeveloper or the buyer a certificate in recordable form releasing the unit fi'om
all encumbrances of this Agreement.
Section 8.3. Relcase and Indemnification 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 cmployees thereof shall not be liable for and agrees to indemnify
and hold harmless the Authority and the City and the governing body members, officers, agents,
servants and employees thereof against any loss or damage to property or any injury to or death
of any person occurring at or about or resulting from any defect in the Minimum Improvements
or the Public Improvements.
(b) Except for any willful or negligent misrepresentation or any willful or wanton
misconduct or negligence of the following named parties, the Redevcloper agrees to protect and
defend the Authority and the City and the governing body members, officers, agents, servants
and employees thereof (the "Indemnified Parties"), now or forever, and further agrees to hold the
Indemnified Parties harmless from any claim, demand, suit, action or other proceeding
whatsoever by any person or entity whatsoever arising or purportedly arising from this
Agreement, or the transactions contemplated hereby or the acquisition, construction, installation,
ownership, and operation of the Minimum Improvements and Public Improvements.
(c) Except for any negligence of the Indemnified Parties (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 Parties shall not be liable for any damage or injury to the
persons or 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 ofthe 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.
23
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 party
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 covenant,
condition, obligation, or agreement on its part to be observed or performed under this Agreement
or the Planning Contract;
(b) The Redeveloper:
(i) tiles 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 assignment for benefit of its creditors;
(iii) admits in writing its inability to pay its debts generally as they become
due; or
(iv) is adjudicated a bankrupt or insolvent.
Section 9.2. Remedies on Default. (a) Whenever any Event of Default referred to in
Section 9.1 of this Agreement occurs, the non-defaulting party may exercise its rights under this
Section 9.2 after providing thirty days written notice to the defaulting party of the Event of
Default, but only if the Event of Default has not been cured within said thirty days or, if the
Event of Default is by its nature incurable within thirty days, the defaulting party does not
provide assurances reasonably satisfactory to the non-defaulting party that the Event of Default
will be cured and will be cured as soon as reasonably possible:
(b) Upon an Event of Default by the Redeveloper, the Authority may withhold
payments under the Commercial Note in accordance with its terms, which withheld amount is
payable, without interest thereon, on the first payment date after the default is cured.
(c) If an Event of Default continues for more than three years after the date of receipt
by the Redeveloper of the default notice, the Authority may terminate the Commercial Note.
24
(d) If the Event of Default constitutes breach of restrictions on Transfer of the
Commercial Property under Section 8.2 hereof, the Authority may terminate the Note if the
default is not cured within the periods provided in Section 9.1.
(e) 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.
Section 9.3. No Remedy 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 particular 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
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
part of the Redeveloper under this Agreement, the Redeveloper agrees that it shall, within 10
days of written demand by the Authority, pay to the Authority the reasonable fees of such
attorneys and such other expenses so incurred by the Authority.
25
ARTICLE X
Additional Provisions
Section 10.1. Contlict of Interests; Authority Representatives Notlndividuallv Liable.
The Authority and the Redcveloper, to the best of their rcspective knowledge, represent and
agrec that no member, official, or employee of the Authority shall have any personal interest,
direct or indircct, in the Agreemcnt, nor shall any such member, official, or employee participatc
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 Rcdeveloper, or
any successor in interest, in the event of any default or breach by the Authority or County or for
any amount which may become due to the Redeveloper or successor or on any obligations under
the terms of the Agreemcnt.
Section 10.2. Equal Employment Opportunity. The Redeveloper, [or 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 Commercial Property
to, the operation of the Minimum Improvcments tor uses described in the definition of such tcrm
in this Agreement, and shall not discriminate upon the basis o[ race, color, creed, sex or national
origin in the sale, lease, or rental or in the use or occupancy of the Commercial Property or any
improvemcnts erected or to be erected thereon, or any part thereof.
Section 10.4. Provisions Not Merged With Deed. None of the provIsIOns of this
Agreement are intended to or shall be merged by reason of any deed transferring any interest in
the Commercial 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, Articles, and
Sections of the Agreement are inserted for convenience of reference only and shall be
disregarded in construing or interpreting any of its provisions.
Section 10.6. Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand, or other communication under the Agreement by either party to
the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail,
postage prepaid, return receipt requested, or delivered personally; and
(a) in the case
Redeveloper at
of the Redeveloper, is addressed to or delivered personally to the
; and
26
(b) in the ease of the Authority, is addressed to or delivered personally to the
Authority at 100 Civic Center Parkway, Columbia Heights, Minnesota 55337, 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 m 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 10.10. Authority or City 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
arise before the Termination Date.
27
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
2008, 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
28
GRAND CENTRAL COMMONS LLC
By
Its
STATE OF MINNESOTA)
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this _ day of
, 2008 by , the of Grand
Central Commons LLC, a Minnesota limited liability company, on behalf of the company.
Notary Public
29
SCHEDULE A
Commercial Propel'ty
Outlot C and Outlot D, Grant Central Lofts, Anoka County, Minnesota
A-I
SCHEDULE B
AUTHORIZING RESOLUTION
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO.
RESOLUTION AI'I'ROVING CONTRACT FOR PRIVATE REDEVELOPMENT AND
RESOLUTION AWARDING THE SALE OF, AND PROVIDING THE FORM, TERMS,
COVENANTS AND DIRECTIONS FOR THE ISSUANCE OF ITS $_ TAXABLE
TAX INCREMENT REVENUE NOTE, SERIES 2008B
BE IT RESOLVED BY the Board of Commissioners ("Board") of the Columbia Heights
Economic Development Authority, Columbia Heights, Minnesota (the "Authority") as follows:
Section I. Authorization.
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 incremcnt financing plan for the purpose of financing certain improvements within the
Proj ect.
Pursuant to Minnesota 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 payablc 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 the best interests of the Authority that it issue and sell its Taxable Tax Increment Revenue
Note in the maximum principal amount of $ (the "Note") for the purpose of
financing certain public redevelopment costs of the Project.
1.02. Approval of Agreement. The Contract for Private Redevelopment (the
"Agreement") between the Authority Grand Central Commons, LLC ("Grand Central
Properties") is approved in substantially the form on file in City Hall, subject to modifications
that do not alter the substance of the transaction that are approved by the President and Executive
Director, provided that execution of the amendment by such officials is conclusive evidence of
and their approval.
1.03. Issuance. Sale. and Terms 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 Commons LLC
("Owner"). The Note shall be dated as of the date of delivery, shall mature no later than
February I, 2018 and shall bear interest at the rate of 7.0% per annum from the date of original
issue of the Note. The Note is issued in consideration of payment by Owner of certain Public
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Redevelopment Costs 111 at least the principal amount of the Note, 111 accordance with the
Agreement.
Section 2. Form of Note. The Note shall be in substantially the following form, with the
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 HEIGI-ITS ECONOMIC DEVELOPMENT AUTHORITY
No. R-I
$
TAXABLE TAX INCREMENT REVENUE NOTE
SERIES 20
Rate
Date
of Original Issue
7.0%
,20_
The Columbia Heights Economic Development Authority ("Authority") for value
received, certifies that it is indebted and hereby promises to pay to Grand Central Commons LLC
or registered assigns (the "Owner"), the principal sum of $ or so much thereof as has
been from time to time advanced (the "Principal Amount"), as provided in the Agreement
defined hereafter, together with interest on the unpaid balance thereof accrued from the date of
original issue hereof at the rate of percent per annum (the "Stated Rate"). This Note is
given in accordance with that certain Contract for Private Redevelopment between the Issuer and
the Owner dated as of , 2008 (the "Agreement") and the authorizing resolution
(the "Resolution") duly adopted by the Authority on ,2008. Capitalized terms
used and not otherwise defined herein have the meaning provided for such terms in the
Agreement unless the context clearly requires otherwise.
1. Payments. Principal and interest ("Payments") shall be paid on August I, 20 I 0
and each February I and August I thereafter to and including February I, 2018 ("Payment
Dates") in 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 the
Owner may designate upon 30 days written notice to the Authority. Payments on this Note are
payable in any coin or currency of the United States of America which, on the Payment Date, is
legal tender for the payment of public and private debts.
2. Interest. Interest accruing from the date of original issue through and including
February I, 2010 will be compounded semiannually on February I and August I of each year
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and added to principal. Interest 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 solcly from and in the amount of the "Available Tax Increment," which means, on
each Payment Date, 90 percent of the Tax Increment attributable to the Commercial Property as
defined in the Agreement that is paid to the Authority by Anoka County in the six months
prcceding the Payment Date.
The Authority shall have no obligation to pay principal of and interest on this Note on
each Payment Date from any sourcc 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
shall not constitute a default hereunder as long as the Authority pays principal and interest
hereon to the extent of such pledged revcnues. The Authority shall have no obligation to pay
unpaid balance of principal or accrued interest that may remain after the final Payment on
February I, 2018.
4. Default. Upon an Event of Defimlt by the Redeveloper under the Agreement, the
Authority may exercise the remedies with respect to this Note described in Section 9.2 of the
Agreement, the terms of which are incorporated herein by reference.
5. Optional Prepavment. (a) The principal sum and all accrued intcrest 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 affcct the amount or timing of any other regular payment
otherwise required to be made under this Note.
(b) Upon receipt by Redeveloper of the Authority's written statement of the Excess
Amount as defined in Section 3 .4( e) of the Agreement, 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 Calculation 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 Owner, 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 onc of an issue in the total principal amount of
$ issued to aid in financing certain public redevelopment costs and administrative
costs of a Project undertaken by the Authority pursuant to Minnesota Statutes, Sections 469.001
through 469.047, and is issued pursuant to the Resolution, and pursuant to and in full conformity
with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections
469.174 to 469.179. This Note is a limited obligation of the Authority which is payable solely
fi'om the revenues pledged to the payment hereof under the Resolution. This Note and the
interest hereon shall not be deemed to constitute a general obligation of the State of Minnesota or
any political subdivision thereof, including, without limitation, the Authority. Neither the State
of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of 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
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Minnesota or any political subdivision thereof is pledged to the payment of the principal of 01'
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 purposc at the
principal office of the City Chief Financial Officer, by the Owner hereof in person or by such
Owner's attorney duly authorized in writing, upon surrender of this Notc 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 govcrnmental charge
required to be paid by the Authority with respect to such transfer or cxchangc, therc will be
issued in thc name of the transferee a new Note of the same aggregate principal amount, bearing
interest at the same rate and maturing on the same datcs.
This Note shall not be transferred to any person unless the Authority has been provided
with an opinion of counscl or a certificate of the transferor, in a form satisfactory to the
Authority, that such transfer is exempt ii'om registration and prospectus delivery requirements of
federal and applicable state securities laws.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things
required by the Constitution and laws of the State of Minncsota to be done, to exist, to happen,
and to be performed in order to make this 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 WHEREOF, the Board of Commissioners of thc Columbia Heights
Economic Developmcnt Authority have caused this Note to be executed with the manual
signatures of its President and Executive Director, all as of the Date of Original Issue specified
above.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Executive Director
President
REGISTRATION PROVISIONS
The ownership of the unpaid balance of the within Notc is registered in the bond register
of the City Chief Financial Officer, in the name of the person last listcd below.
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Date of
Registration
Registered Owner _
Signature 0 f
City Chief Financial Officer
Grand Central Commons LLC
Federal Tax J.D. No.
Section 3.
Tcrms, Execution and Delivery.
3.01. Denomination, Pavment. The Note shall be issued as a single typewritten note
numbered R-l.
The Note shall be issuable only in fully registcred form. Principal of and intercst on the
Note shall be payable by check 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 the Payment Date, whethcr or not such day is a business day.
3.03. Registration. The Authority hereby appoints the City Chief Financial Officer to
perform the functions of registrar, transfer agent and paying agent (the "Registrar"). Thc effect
of registration and the rights and duties of the Authority and the Registrar with respect thereto
shall be as follows:
(a) Register. 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 Note duly endorsed by the
registered owner thereof or accompanied by a written instrument of transfer, in form reasonably
satisfactory to the Rcgistrar, duly executed by thc registercd owner thereof or by an attorney duly
authorized by the registered owncr 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 providcd with an opinion of counsel
or a certificate of the transferor, in a form satisfactory to the Authority, that such transfer is
cxempt from registration and prospectus delivery requirements of federal and applicable state
securities laws. The Registrar may close thc books for registration of any transfer after the
fifteenth day of the month preceding each Paymcnt 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.
(d) Improper or Unauthorized Transfer. When the Note is presented to the Registrar
for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement
on such Note or separate instrument of transfer is legally authorized. The Registrar shall incur
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no liability for its refusal, in good faith, to make transfers which it, in its judgment, deems
improper or unauthorized.
(e) Persons Deemed Owners. The Authority and the Registrar may treat the person in
whose name the Notc is at any time registered in the bond register as the absolute owner of the
Note, whether the Notc shall be overdue or not, for the purpose of receiving payment of, or on
account of, the principal of and interest on such Note and for all other purposes, and all such
payments 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 ofthe
sum or sums so paid.
(f) Taxes. Fees and Charges. For every transfer or cxchange of thc 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 in exchange and substitution for and upon cancellation of such mutilated
Note 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 and evidence of such cancellation shall be
given to the 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 Deliverv. The Note shall be prepared under the direction of the
Executive Director and shall be executed on behalf of the Authority by the signatures of its
President and Executive Director. In case any officer whose signature shall appear on the Note
shall cease to be such officer before the delivery of the Note, such signature shall nevertheless be
valid and sutlicient for all purposes, the same as if such officer had remained in otlice 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. Security Provisions.
4.01. Pledge. The Authority hereby pledges to the payment of the principal of and
interest on the Note all Available Tax Increment under the terms and as defined in the Note.
Available Tax Increment shall be applied to payment of the principal of and interest on the Note
in accordance with the terms of the form of Note set forth in Section 2 of this resolution.
B-6
4.02. Bond Fund. Until the date the Note is no longer outstanding and no principal
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 no
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 Note in accordance with its terms.
4.03. Additional Bonds. If the Authority issues any bonds or notes secured by
Available Tax Increment, such additional bonds or notes are subordinate to the Note in 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 known 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.
Agreement.
Effective Date. This resolution shall be effective upon execution of the
Adopted this _ day of
,2008.
President
Executive Director
B-7
SCHEDULE C
CERTIFICATE OF COMPLETION
The undersigned hereby certifies that Grand Central Commons LLC (the "Redeveloper")
has fully complied with its obligations under Articles III and IV of that document titled
"Contract for Private Redevelopment," dated , 2008 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:
,20 .
COLUMBIA HEIGHTS ECONOMIC
DEVELOPMENT AUTHORITY
I3y
Its Executive Director
STATE OF MINNESOTA )
) ss.
COUNTY OF ANOKA )
On this _ day of ,20_, 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 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
STATE OF MINNESOTA )
) ss.
COUNTY OF ANOKA )
On this _ day of ,20_, 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
C-l
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
C-2
SCHEDULE D
INVESTMENT LETTER
To the Columbia Heights Economic Dcvelopmcnt Authority (Authority)
Attention: Executivc Director
Re: $_ Tax Increment Revenue Note, Series 2008B
The undersigned, as Purchaser of the above captioned Note (Note) pursuant to a
resolution of the Authority adopted on , 2008 (Resolution), hereby represents to
you and to Kennedy & Graven, Chartered, Minneapolis, Minnesota, Bond Counsel, as follows:
1. We understand and acknowledge that the Note is delivered to the Purchaser as of
this date pursuant to the Resolution and the Contract for Private Redevelopment between the
Authority and Grand Central Commons LLC dated , 2008 (Contract).
2. The Note is payable as to principal and interest solely from Available Tax
Increment as defined in the Note. The Purchaser understands and acknowledges that the
Authority makes no representations or warranties regarding the amount of Available Tax
Increment, or that revenues pledged to the Note will be sufficient to pay the principal and interest
on the Note. Any estimates of Tax Increment prepared by the Authority or its financial advisors
in connection with the TIF District, the Note or the Contract are for the benefit of the Authority,
and are not intended as representations on which the Purchaser may rely.
3. We have sufficient knowledge and experience in financial and business matters,
including purchase and ownership of municipal obligations, to be able to evaluate the risks and
merits of the investment represented by the purchase of the above stated principal amount of the
Note.
4. We acknowledge that no offering statement, prospectus, offering circular or other
comprehensive offering statement containing material information with respect to the Authority
ffild the Note has been issued or prepared by the Authority, and that, in due diligence, we have
made our own inquiry and analysis with respect to the Authority, the Note and the security
therefor, and other material factors affecting the security and payment of the Note.
5. We acknowledge that we have either been supplied with or have access to
information, including financial statements and other financial information, to which a
reasonable investor would attach significance in making investment decisions, and we have had
the opportunity to ask questions and receive answers from knowledgeable individuals concerning
the Authority, the Note and the security therefor, and that as a reasonable investor we have been
able to make our decision to purchase the above stated principal amount of the Note.
6.
qualified for
We have been informed that the Note (i) is not being registered or otherwise
sale under the "Blue Sky" laws and regulations of any state, or under federal
D-l
securities laws or regulations, (ii) will not be listed on any stock or other securities exchange, and
(iii) will carry no rating fi'01ll any rating service.
7. We acknowledge that neither the Authority nor Kelmedy & Graven, Charted has
made any representations as to the status of interest on the Note for state or federal income tax
purposes.
8. We represent to you that we are purchasing the Note for our own accounts and not
for resale or other distribution thereof~ except to the extent otherwise provided in the Note or the
Resolution.
9. All capitalized terms used herein have the meaning provided in the Contract
unless the context clearly requires otherwise.
10. The Purchaser's federal tax identification number is
11. We acknowledge receipt of the Note on the date hereof.
GRAND CENTRAL COMMONS LLC
By
Its
Dated:
,2008.
D-2
SCHEDULE E
ASSESSMENT AGREEMENT
THIS AGREEMENT, made and entered into as of the day of , 2008
by and between the and the COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT
AUTHORITY, a Minnesota public body corporate and politic (the "Authority") and GRAND
CENTRAL COMMONS LLC, a Minnesota limited liability company (the "Redeveloper").
WITNESSETH:
WHEREAS, the Authority and the Redeveloper entered that certain agreement entitled
Contract for Private Dcvelopment dated , 2008 (the "Contract"); and
WHEREAS, pursuant to the Contract the Redeveloper is obligated to construct, or has
constructed, the Minimum Improvements (as defined in the Contract) upon the property legally
described at Exhibit A hereto (the "Property"); and
WHEREAS, the Authority and the Redeveloper desire to establish a minimum market
value for the Property and the Minimum Improvements constructed thereon, pursuant to
Minnesota Statutes, Section 469.177, Subdivision 8; and
WHEREAS, the Assessor for Anoka County (the "Assessor") has reviewed the plans and
specifications for the Improvements;
NOW, THEREFORE, the parties to this Agreement, in consideration of the promises,
covenants and agreements made by each to the other, do hereby agree as follows:
1. The minimum market value which shall be assessed for the Property described in
Exhibit A, together with the Improvements thereon, for ad valorem tax purposes, shall be
$ as of January 2, 2010 and each January 2 thereafter, notwithstanding the
progress of construction of the Minimum Improvements by such dates.
2. The minimum market value herein established shall be of no further force and
effect and this Agreement shall terminate on the Termination Date (as defined in the Contract).
3. Neither the preambles nor provisions of this Agreement are intended to, nor shall
they be eonstrued as, modifying the terms of the Contraet.
4. This Agreement shall inure to the benelit of and be binding upon the successors
and assigns of the parties.
5. Each of the parties has authority to enter into this Agreement and to take all
actions required of it, and has taken all aetions necessary to authorize the execution and delivery
of this Agreement.
E-l
6. In the evcnt any provIsIon of this Agreement shall be held invalid and
unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render
unenforceable any other provision hereof.
7. This Agrcement may not be amended nor any of its terms modified except by a
writing authorized and executcd by all parties hereto.
8. This Agrecment may be simultaneously executed in several counterparts, each of
which shall be an original and all of which shall constitutc but one and the same instrument.
9. This Agreement shall be construed in accordance with the laws of the State of
Minnesota. Any disputc arising from this Agreement shall bc heard in the statc or federal courts
of Minnesota, and all parties waive any objection to the jurisdiction thereof, whether based on
convenience or otherwise.
E-2
IN WITNESS WHEREOF, the parties hereto have set their hands and seals as of the day
and year first above written.
THE 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
200_, by and
, the President and Executive Director of the
Columbia Heights Economic Development Authority, a public body corporate and politic under
the laws of the state of Minnesota, on behalf of the Authority.
Notary Public
E-3
GRAND CENTRAL COMMONS LLC
By:
Its:
By:
Its:
STATE OF MINNESOTA )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this _ day of
2008 by and of Grand Central Commons LLC, a
Minnesota limited liability company, on behalf of the company.
Notary Public
This document drafted by:
Kennedy & Graven, Chartered
470 US Bank Plaza
Minneapolis, MN 55402
(612) 337-9300
E-4
EXHIBIT A TO ASSESSMENT AGREEMENT
PROPERTY LEGAL DESCRIPTION
Outlot C and Outlot D, Grant Central Lofts, Anoka County, Minnesota
E-A-l
CERTIFICATION BY COUNTY ASSESSOR
The undersigned, having revicwed the plans and specifications for the improvements to
be constructed and the market value assigned to the land upon which the improvements are to be
constructed, hereby certifies as follows: Thc undersigncd Assessor, being legally responsible for
the assessment of the above described property, hereby certifies that the values assigned to the
land and improvements are reasonable.
County Assessor for the County of Anoka
STATE OF MINNESOTA )
) ss.
COUNTY OF ANOKA )
The foregoing instrument was acknowledged before me this _ day of
by , the County Assessor of the
County of Anoka.
Notary Public