HRA Report 2013-02 Purchase AGreement - Mokabaka, LLC-co
City of HopkinE
May 30, 2013 HRA Report 2013-02
PURCHASE AGREEMENT — MOKABAKA, LLC
Proposed Action
Staff recommends adoption of the following motion: Move to approve the Purchase
Agreement between the Hopkins Housing and Redevelopment Authority and
Mokabaka, LLC.
With this motion the Purchase Agreement will be executed. It is understood that staff
has the authority to make modifications that do not change the intent of the agreement.
Overview
In 2014, Hennepin County, in partnership with the cities of Hopkins and Minnetonka, will
begin construction on the widening of County Road 61, also known as Shady Oak
Road. This project will require the acquisition of additional right-of-way. In order to
maximize the benefits of the road project and minimize the impacts, Hennepin County
awarded the cities $3 million in Community Works funds to conduct a variety of activities
including property acquisition, demolition and construction of new parking areas.
The City of Hopkins has been in negotiations with several of the property owners and is
now in a position to move forward with three property acquisitions that will utilize the
Community Works funds to create redevelopment opportunities and replacement
parking in the corridor.
Under this agreement, Mokabaka will sell the property at 20/24 Shady Oak Road to the
HRA and receive development rights to the property at 108/112 Shady Oak Road. A
portion of their current property will then be offered in exchange for the Syndicate Sales
property.
Primary Issues to Consider
• What is the overall plan for the use of Community Works funds in the corridor?
• What are the terms of this agreement?
Supporting Documents
• Purchase Agreement with Mokabaka LLC
• Cooperative Agreement for Shady Oak Road Community Works Project
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Ke sten Iverum
Directo f Planning & Development
Analysis of Issues:
What is the overall plan for the use of Community Works funds in the
corridor?
The following scenario was developed based on the needs of the property owners and
the availability of Community Works funds:
The HRA will purchase the following properties:
Address: Occupants:
120 & 112 Shady Oak Rd Leaman's Liquor/Nelson's Meats & Bakery
108 Shady Oak Rd Syndicate Sales
20 & 24 Shady Oak Rd Snap Print/Studio Tan (owned by Mokabaka, LLC)
The tenants — Nelson's Meats, Studio Tan and Snap Print — will receive their relocation
eligibility letters on June 5, 2013. Nelson's Meats will be relocated within 90 days. The
closing on Leaman's Liquor Inc. property will take place on June 27, 2013. From June
27. 2013, until the 90 -day period is up, the HRA will own the property and lease back
the space to both Leaman's Liquors and Nelson's Meats, with the tenants paying all
operating costs.
The closing on the remaining properties will take place after the Leaman's/Nelson's
building has been vacated, anticipated to occur in early September. At this time, the
Leaman's/Nelson's building will be demolished and the property will be conveyed to
Mokabaka, LLC for the construction of a new building that will be the new home to Snap
Print and up to two additional tenants, which may include Studio Tan.
When the new building is constructed, the northern portion of the former Mokabaka
property will be demolished and a new supporting wall constructed. Additional
improvements will be made to the property to accommodate Syndicate Sales, who will
then move into the former Snap Print location.
At this time, the current Syndicate Sales building will be demolished to create parking
for the new Snap Print (and tenants), as well as shared parking with the VFW.
Additional shared parking will also be created using the northern portion of the
Mokabaka property.
• What are the terms of this agreement?
The purchase price under the proposed agreement is $950,000. At the time of closing,
a Purchase and Development Agreement, attached as exhibit D will be executed. That
agreement details the sale of the redevelopment parcel to Mokabaka LLC for $1 with
the condition the developer will undertake the demolition (but reimbursed by the HRA)
and agree to construct the minimum improvements which includes a 10,000 square foot
building and associated parking, at Mokabaka's expense.
The agreement gives the seller's affiliated entity, Snap Print, the right to continue to
occupy the property under the terms of the attached lease. Studio Tan will remain as a
sub-leasor of Snap Print.
Alternatives
The HRA has the following alternatives regarding this item:
• Approve the Purchase Agreement as recommended.
• Recommend changes to the Purchase Agreement.
• Elect not to enter into a Purchase Agreement with the property owner.
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (the "Agreement") is made and entered effective as
of the latest date set forth opposite the parties' signatures at the end of this Agreement (the
"Effective Date"), by and between Mokabaka LLC, a Limited Liability Company under the laws
of the State of Minnesota (referred to hereinafter as "Seller"), and the Housing And
Redevelopment Authority in and for the City of Hopkins, Minnesota, a public body corporate and
politic under the laws of the State of Minnesota (referred to hereinafter as "Buyer").
This offer to Purchase is only valid until 32013.
A. RECITALS
A. Seller is the fee owner of certain real property located at 20 and 24 Shady Oak
Road, City of Hopkins, Hennepin County, Minnesota, and legally described in Exhibit A attached
hereto and incorporated herein by this reference, including, without limitation, (i) all buildings,
improvements, and fixtures situated thereon; and (ii) all easements and rights including, without
limitation, any right, title or interest in any public streets or other public rights-of-way, whether
vacated or unvacated, and all other right, title, tenements, hereditaments and interest benefiting or
appurtenant thereto (collectively, the "Property").
B. Buyer desires to purchase the Property and Seller is willing to sell the Property to
Buyer upon the terms and conditions set forth hereinafter.
NOW, THEREFORE, in consideration of the payments to be made hereunder and the
foregoing premises and the mutual covenants and agreements set forth herein, it is hereby agreed
as follows:
1. RECITALS INCORPORATED. The foregoing recitals are incorporated as if fully set
forth herein.
2. SALE AND PURCHASE OF PROPERTY. Seller agrees to sell, and Buyer agrees to
purchase the Property legally described in Exhibit A. The purchase price ("Purchase Price") to be
paid by Buyer to Seller for the Property is Nine Hundred Fifty Thousand Dollars ($950,000.00).
The Purchase Price shall be payable as follows:
a. $5,000, cash, as Earnest Money (the "Earnest Money") to be deposited in escrow by Buyer
on the Effective Date with Commercial Partners Title, LLC (the "Title Company") which
the Title Company is instructed to hold and disburse in accordance with the terms of this
Hopcivil\MokabakaPurchaseAgreement.5.2.13
Agreement. The Earnest Money shall be deposited in an interest-bearing account with
interest to be applied to the Purchase Price on the Closing Date, except as otherwise stated
in this Agreement. The phrase "Earnest Money" shall include any such interest accrued
thereon.
b. The balance of $945,000 shall be paid by cashier's check or wire transfer, on the Closing
Date stated in Section 8 of this Agreement.
3. DUE DILIGENCE PERIOD AND CONTINGENCIES. Buyer's obligations under this
Agreement are subject to and contingent upon satisfaction of the contingencies stated in this
Section 3. The time period commencing on the Effective Date of this Agreement and ending on
the first business day that is sixty (60) days after the Effective Date is referred to herein as the
"Due Diligence Period". During such Due Diligence Period, Buyer shall satisfy itself as to the
condition of, and matters relating to, the Property, including:
(a) Title. Buyer shall be satisfied that title to the Property is good and marketable or
shall be good and marketable on the Closing Date. No later than ten (10) days after the Effective
Date, Seller shall deliver to Buyer the original Abstract of Title covering the Property or a copy of
Seller's Owner's Title Insurance Policy if in Seller's possession or available to Seller. If Seller
does not possess either the original Abstract of Title or an Owner's Title Insurance Policy, Seller
shall have no obligation to deliver such items to Buyer. Within twenty (20) business days of the
Effective Date, Buyer shall obtain a commitment to issue an ALTA Owner's title insurance policy
(the "Title Commitment") for the Property issued by the Title Company naming Buyer as the
proposed owner/insured of the Property for the insured amount of the Purchase Price. Seller shall
pay the fees of the Title Company for examination of title and issuance of the Title Commitment.
The premium for issuance of the Title Insurance Policy to be issued to Buyer shall be paid by
Buyer. The Title Commitment shall commit to insure marketable title in fee simple in Buyer, free
and clear of all mechanic's liens, questions of survey, unrecorded interests or rights of parties in
possession and subject only to such matters or exceptions to title as Buyer may approve pursuant
to this Agreement. The Title Commitment must be accompanied by legible copies of all title
exceptions and Schedule B documents noted therein. Buyer will be allowed 30 days after receipt
of the Title Commitment for examination thereof and for making any objections to the
marketability of the title to the Property, said objections to be made by written notice or to be
deemed waived. If any objections are so made to the marketability of the title to the Property,
Seller shall immediately commence and diligently endeavor to complete all actions necessary to
cure such objections and shall be allowed sixty (60) days after the making of such objections by
Buyer to cure such objections and make the title to the Property good and marketable of record in
Seller. Pending the correction of the title, the Closing Date and the payment hereunder required
shall be postponed, but upon correction of the title and within 15 days after written notice of such
correction given by Seller to Buyer, Seller and Buyer shall perform this Agreement according to
its terms. If Seller refuses or fails to have such additional objections cured or removed on or before
Closing, Buyer may, at its sole election, either (a) terminate this Agreement without any liability
on its part; or (b) consummate the purchase and sale contemplated hereby, and withhold from the
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Purchase Price such sums as are necessary, in the judgment of the Title Company, to cure the
objections.
(b) Survey. Buyer may, at Buyer's expense, at any time during the Due Diligence
Period, obtain an ALTA survey of the Property certified to Buyer and the Title Company by a
registered land surveyor (the "Survey"). Within ten (10) days after the Effective Date, Seller shall
deliver to Buyer copies of any existing surveys of the Property that are in Seller's possession or
are available to Seller. If the Survey obtained by Buyer discloses any matter that makes title to the
Property unmarketable and to which Buyer has not previously made objection under Paragraph
(a), above, Buyer may notify Seller of such additional title objection and Seller shall be obligated
to diligently endeavor to complete all actions necessary to cure such additional objection in the
manner provided in Paragraph (a), above.
(c) Environmental Reports. Seller shall provide, within ten (10) days after the
Effective Date, copies of any and all environmental assessment reports, remediation reports,
governmental statutory or regulatory filings and reports, and all other correspondence and other
documentation regarding the environmental condition of the Property in the Seller's possession
(the "Existing Environmental Reports"). Buyer may obtain, at Buyer's expense, a current
environmental site assessment (the "Buyer's Phase I Report"). The Existing Environmental
Reports and Buyer's Phase I Report are referred to hereinafter together as the "Environmental
Reports". All matters disclosed by the existing Environmental Reports and the Buyer's Phase I
Report shall be satisfactory and acceptable to Buyer in Buyer's sole discretion.
(d) Seller's Documents. Seller shall provide to Buyer within twenty (20) days after
the Effective Date (or such other period of time as may be specified as to individual documents)
the documents, material and information described below (collectively "Seller's Documents"):
(i) Copies of any site plans, topographical drawings, soil reports, utility plans
and the like related to the Property in Seller's possession or control;
(ii) Copies of all contracts related to the Property which are not terminable
upon thirty (30) days' notice or less, and related files, if any;
(iii) Copies of any existing surveys, including wetlands surveys, within Seller's
possession; and
(iv) Copies of any reports, assessments and other information in Seller's
possession, and copies of all reports and information, if any, filed by Seller
with the MPCA, the State Health Department, the County Recorder, or any
other regulatory body, regarding any existing or former underground
storage tanks or any other environmental condition of the Property.
Hopcivil\MokabakaPutchaseAgreement.5.2.13
All matters disclosed by the Seller's Documents shall be satisfactory and acceptable to Buyer, in
Buyer's unqualified discretion.
(e) Inspection. Buyer shall have the right to undertake inspections, tests, and
investigations of the Property and all improvements located thereon during the Due Diligence
Period. Seller shall provide Buyer with access to the Property without charge and at all reasonable
times during the Due Diligence Period for purposes of inspection, testing and approval of the
Property, and completion of environmental, engineering, and such additional investigation and
testing as is deemed desirable by Buyer. In the event Closing (as hereinafter defined) does not
occur for any reason, Buyer shall repair and restore any damage to the Property caused by Buyer's
testing and shall return the Property to the same condition as existed prior to the testing. All
matters disclosed by such inspections shall be satisfactory and acceptable to Buyer, in Buyer's
sole and unqualified discretion.
(f) Acquisition of Adjacent Properties. As of the Closing Date stated in Section 8
of this Agreement, Buyer shall have acquired all of the adjacent tracts of real property identified in
Exhibit B attached hereto and incorporated herein by reference (the "Adjacent Properties"), upon
terms and conditions acceptable to Buyer in Buyer's sole discretion.
If any of the above contingencies have not been satisfied on or before the end of the Due
Diligence Period or, in the case of Paragraphs (a), (b) and (f), above, the applicable dates stated in
such paragraphs, then this Agreement may be terminated, at Buyer's option, by written notice from
Buyer to Seller. Such notice of termination may be given at any time on or before the applicable
dates stated above. Upon such termination, the Earnest Money shall be refunded to Buyer and
upon such return, this Agreement shall become null and void and neither party will have any
further rights or obligations regarding this Agreement or the Property. Should Buyer fail to give
notice of termination on or before the applicable date stated above with respect to any of the
foregoing contingencies, the contingency in question shall be conclusively deemed to have been
waived by Buyer. Buyer shall have the right to unilaterally waive any contingency by written
notice to Seller.
Seller shall allow Buyer, and Buyer's agents, access to the Property without charge and at all
reasonable times for the purpose of Buyer's investigation and testing. Buyer shall pay all costs and
expenses of such investigation and testing, except as herein otherwise expressly stated, and shall
hold Seller and the Property harmless from all costs and liabilities relating to Buyer's activities.
Buyer shall further repair and restore any damage to the Property caused by or occurring during
Buyer's testing and return the Property to substantially the same condition as existed prior to such
entry.
Seller agrees that Buyer's undertaking to acquire the Property and Buyer's commitment and
expenditure of skill and Buyer's funds to perform the investigations described in this Section 3
constitute reasonable and adequate consideration for Seller's execution of this Agreement and the
performance of Seller's obligations hereunder, notwithstanding the fact that, under certain
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HopciviT\MokabakaPurchaseAgreement.52.13
circumstances, the Earnest Money is refundable to Buyer if the contingencies stated in this Section
3 are not satisfied.
4. REPRESENTATIONS OF SELLER. Seller hereby represents and warrants to Buyer
the following:
(a) Environmental Compliance. Seller has received no notice of and is not aware of
any violation related to the Property of applicable law, statute, ordinance, rule, regulation, order or
determination of any governmental authority with respect to hazardous substances or of the
presence of hazardous substances in or on the Property; and that except as disclosed in any of the
Environmental Reports, to Seller's knowledge, the Property has not been used for storage,
destruction or disposal of hazardous substances, no hazardous substances have been released from
the Property and Seller has received no notice, and is not aware of any prior notice, from the
Minnesota Pollution Control Agency or any other governmental authority relating to hazardous
substances at the Property. For purposes hereof "hazardous substances" means any substance
designated pursuant to the Clean Water Act, Title 33 U.S.C. Section 1321, any element,
compound, mixture, solution or substance designated pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act, Title 42 U.S.C. Section 9602, any
hazardous waste having the characteristics identified under or listed pursuant to the Solid Waste
Disposal Act, Title 42, U.S.C. Section 6921, any toxic pollutant listed under Section 307(a) of the
Clean Water Act, Title 33 U.S.C. Section 1317(a), any hazardous air pollutant listed under
Section 112 of the Clean Air Act, Title 342 U.S.C. Section 7412, any imminently hazardous
chemical substance or mixture with respect to which the Administrator of the Environmental
Protection Agency has taken action pursuant to Section 7 of the Toxic Substances Control Act,
Title 15 U.S.C. Section 2606 and any hazardous waste, hazardous substance, pollutant or
contaminant, as defined in the Minnesota Environmental Response and Liability Act, Minnesota
Statutes, Section 11513.02. The term also includes, but is not limited to, polychlorinated
biphenyls, asbestos, petroleum products and various constituents of such products, urea
formaldehyde and related substances.
(b) Storage Tanks. Seller is not aware of any underground storage tanks located on or
in the Property. If the investigation to be undertaken in connection with the Buyer's Phase I
Report shall confirm the existence of one or more storage tanks not identified in this Section, or if
any tank identified in this Section is not in use or is leaking, then Seller shall have such tank(s)
removed by a qualified contractor prior to Closing at Seller's expense, such removal to be
undertaken in compliance with all applicable statutes, rules, and regulations and are required
reports to be filed with appropriate authorities. Upon removal, testing of the surrounding soil shall
be completed at Seller's expense to determine if any leakage or spillage may have occurred,
resulting in any soil contamination and Seller shall perform all remediation required by the MPCA
or any other governmental authority having jurisdiction, all at Seller's sole expense, prior to
Closing. Buyer's obligation to close shall be contingent upon Buyer's satisfaction, in the Buyer's
sole judgment, with Seller's performance of the foregoing obligations.
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(c) Pending Litigation. There is no litigation or other proceeding presently pending
or, to Seller's knowledge, under consideration by any party affecting, directly or indirectly, the
Property which would in any way impair Seller's ability to perform its obligations under this
Agreement, with the exception of the condemnation proceeding to be undertaken in connection
with the proposed improvements to Shady Oak Road (the "Shady Oak Road Project'').
(d) Governmental Action. Seller has not received notice of any action, suit or
proceeding instituted by any person or entity against or affecting the Property before any federal,
state, municipal or other governmental authority, including without limitation notice of any
condemnation or taking for any public right-of-way or utility, with the exception of the Shady Oak
Road Project.
(e) Authorization. Seller is the sole owner of the Property, and has the right, power
and capacity to enter into this Agreement, to consummate the transactions contemplated hereby,
and to comply with the terms, conditions .and provisions hereof.
(f) Condition of Property. Seller has received no notice, order or other
communication from any governmental body having jurisdiction over the Property requiring any
improvement to or alteration of the Property which has not been remedied, and Seller agrees to
give Buyer prompt written notice of any such communication received on or prior to Closing
Date.
(g) Underground Storage Tanks Affidavit. In the event that there are any
underground storage tanks on the Property, Seller agrees to file a storage tank affidavit complying
with Minnesota Statutes § 116.48, subd. 6, as amended, prior to Closing.
(h) Wells/Septic Systems. Seller certifies and warrants that it is not aware of the
existence of any wells on the Property within the meaning of Minn. Stat. § 1031.005, or of any
individual sewage treatment system on the Property within the meaning of Minn. Stat. § 115.55.
(i) Right to Sell. Seller has not entered into any other unterminated contracts for the
sale of the Property and is not aware of any rights of first refusal or options to purchase the
Property. Consummation of the sale will not violate the provisions of any agreement or
instrument by which Seller is bound or, to Seller's knowledge, any governmental regulation or law
applicable to Seller.
(j) Unrecorded Documents. With the exception of the Leases identified in Section
16, below, there are no unrecorded leases, contracts, easements, licenses or any other documents
creating rights in parties other than Seller which cannot be terminated by Seller prior to Closing
and which will continue to affect the Property after Closing.
(k) Removal of Personal Property. Seller shall remove, and shall require all tenants
to remove, all personal property and debris, if any, from the Property by the Closing Date.
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(1) FIRPTA. Seller is not a "foreign person", "foreign partnership", "foreign trust" or
"foreign estate" as those terms are defined in Section 1445 of the Internal Revenue Code.
Seller will indemnify Buyer against and will hold Buyer harmless from, any expenses or damages,
including reasonable attorneys' fees, that Buyer incurs because of the breach of any of the above
representations and warranties, whether such breach is discovered before or after Closing. Each of
the representations and warranties herein contained shall survive the Closing for a period of 24
months. Any claim for breach of the representations and warranties contained in this Agreement
must be brought by Seller within 18 months after the date of Closing, and all such claims shall be
barred if not brought within that time period. Buyer is purchasing the Property based upon its own
investigation and inquiry and, except for the representations and warranties of Seller stated herein,
is not otherwise relying on any representation of Seller or other person and agrees to accept and
purchase the Property "as is, where is".
5. RIGHTS/DUTIES. At all times prior to Closing, Seller shall comply with the following:
(a) Seller shall maintain the Property in the same condition as in existence on the date
hereof and shall comply at all times with all applicable codes and ordinances;
(b) Seller shall continue to pay all real estate taxes and any installments of special
assessments certified thereto which become due and payable.
(c) Seller shall not permit the storage, release or disposal of hazardous or toxic
substances or contaminants on the Property; and
(d) Seller shall not encumber, permit liens to attach to, or convey any interest in the
Property to any other party.
(e) No permanent improvements shall be constructed on the Property without Buyer's
written consent.
(f) Seller shall pay all utilities due up to and including the Closing Date.
(g) During the time period between the Effective Date and the Closing Date, Seller
shall not amend or modify the existing Leases identified in Section 16, below, nor shall Seller
enter into any new leases or other contracts affecting the Property which may not be terminated on
or before the Closing Date.
6. CONTINGENCIES TO CLOSING. Buyer's obligation to close shall be subject to the
following contingencies:
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Hopcivi]\MokabakaP=haseAgreemmt.5.2.13
(a) Buyer's receipt at Closing of a satisfactorily marked -up Title Commitment or Pro
Forma owner's title insurance policy to issue an Owner's Title Insurance Policy meeting the
requirements set forth in Section 3(a) hereof as of the Closing Date.
(b) Seller's performance of each of its obligations under this Agreement.
(c) Seller's representations and warranties being true and correct in all matters on and
as of the Closing Date and Seller's delivery of a certificate (a "Bring Down Certificate") to Buyer
at Closing to such effect.
(d) Seller shall not have entered into any leases, license' agreements or material
contracts for all or any portion of the Property, or constructed any permanent improvements,
without Buyer's consent.
(e) Seller's satisfaction with the Survey if one is obtained by Buyer as allowed under
Section 3(b).
(f) The contingencies stated in Section 3 of this Agreement shall have been satisfied or
waived in accordance with the terms and conditions of Section 3.
(g) As of the Closing Date, the Hennepin County Housing And Redevelopment
Authority ("HCHRA") shall have approved this Agreement in accordance with the terms and
conditions of the Cooperative Agreement between Buyer and the HCHRA for the Shady Oak
Road Community Works Project.
The contingencies set forth in this Section 6 are solely for Buyer's benefit and may be waived or
enforced only by Buyer. If any of the above contingencies have not been satisfied on or before the
applicable dates for satisfaction of each such contingency, then this Agreement may be terminated,
at Buyer's option, by written notice from Buyer to Seller given at any time on or before the
applicable contingency date. Upon such termination, the Earnest Money shall be refunded to
Buyer and, upon such return, this Agreement shall become null and void and neither party shall
have any further rights or obligations regarding this Agreement. Should Buyer fail to give notice
of termination on or before the applicable date with respect to any of the foregoing contingencies,
the contingency in question shall be conclusively deemed to have been waived by Buyer.
7. CONTROL OF PROPERTY, CONDEMNATION, CASUALTY LOSS.
(a) Seller's Risk of Loss. Until Closing, Seller shall have the full responsibility and
the entire liability for any and all damages or injury of any kind whatsoever to the Property, and to
any and all persons, whether employees or otherwise, and all property from and connected to the
Property, except that Buyer shall be responsible for damages or injury caused by Buyer or Buyer's
representatives during Buyer's inspection and testing of the Property.
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HopcivilLMokabakaPuTcbaseAgreement.5.2.13
(b) Condemnation. If the Property (or any part thereof) is threatened with
condemnation, or legal proceedings are commenced under the power of eminent domain, Seller
shall promptly notify Buyer of such fact; in writing, this Agreement shall remain in effect in all of
its terms and conditions and Buyer call be entitled to receive all condemnation payments and
awards, in which event the Purchase Price shall remain the same, and Seller shall assign to Buyer,
and Buyer shall be entitled to receive, all rights to the condemnation awards.
(c) Damage/Destruction. If, prior to Closing, the Property (or any part thereof) is
destroyed or damaged, Seller shall notify Buyer of such destruction or damage, and Buyer shall
then have the option to terminate this Agreement or to proceed with the Closing. If Buyer elects
to proceed with the Closing, Buyer shall have the option of receiving all insurance proceeds
payable to Seller as a result of such damage and, to the extent the same may be necessary or
appropriate, Seller shall assign to Buyer at Closing Seller's rights to such proceeds, or the Buyer
shall receive a reduction to the Purchase Price in an amount equal to such proceeds. Seller shall
bear all risk of loss prior to Closing.
8. CLOSING. The closing shall take place on September 16, 2013, or such other date as is
mutually agreed upon in writing by the parties (the "Closing Date").
The closing of this transaction (the "Closing") shall take place at the office of the Title Company,
or another location mutually agreeable to the parties. Possession of the Property shall be delivered
on the Closing Date.
9. SELLER'S CLOSING OBLIGATIONS. Each of the following shall be a necessary
precondition to Buyer's obligation to close hereunder:
(a) Seller's Deliveries. At or prior to the Closing, Seller shall execute, acknowledge
and/or deliver, as appropriate, the following:
(i) A Warranty Deed to the Property conveying marketable fee simple title,
subject only to the Permitted Encumbrances. If there are no wells on the
Property, the Warranty Deed shall include the following statement: "Seller
certifies that Seller does not know of any wells on the described Real
Property." If there are wells located on the Real Property, Seller shall
deliver a well disclosure certificate as required by Minn. Stat. § 103I.235
disclosing the location and status of all wells located on the Property and
providing such well disclosure documentation as required.
(ii) Bring Down Certificate regarding Seller's representations and warranties.
(iii) Standard Seller's Form Affidavit, in form and content acceptable to Buyer
and sufficient to permit the Title Company to delete from the Title
Commitment any exception regarding mechanic's liens, rights of parties in
possession and unrecorded interests.
HoNivil\MokabakaP=haseAgreement.5.2.13
(iv) Affidavit required pursuant to Section 1445 of the Internal Revenue Code
and/or the regulations relating thereto stating, under the penalties of perjury,
that (i) neither Seller nor any other party so swearing is a foreign person,
(ii) the U. S. taxpayer identification number of Seller and such other parties,
if any, and (iii) such other information as may be required by regulations
enacted by the U. S. Department of the Treasury in connection with
Section 1445 of the Internal Revenue Code.
(v) Certificate of Real Estate Value required by the Minnesota Department of
Revenue.
(vi) Septic Disclosure Statements and well sealing certificates, if applicable, in
accordance with applicable law.
(vii) Written terminations of the lease identified in Section 16 and such other
documents as may be reasonably necessary or appropriate to effect the
consummation of the transaction contemplated in this Agreement.
(viii) Seller's affiliated entity, Snap Print, Inc., shall execute and deliver the Snap
Print Lease described and identified in Section 16 of this Agreement.
(b) Title Commitment. Buyer shall be satisfied with the marked -up Title
Commitment, which Title Commitment shall reflect that all of the standard exceptions have been
deleted, and shall show no exceptions except those known and not objected to by Buyer as
provided in Section 3(a).
10. BUYER'S OBLIGATIONS AT CLOSING. At Closing, and subject to the terms,
conditions, contingencies and provisions hereof and the performance by Seller of its obligations as
set forth herein, the Buyer shall pay to Seller the Purchase Price. All sums paid by Buyer to Seller
shall be credited against the Purchase Price.
11. CLOSING COSTS. The following costs and expenses shall be paid as follows in
connection with the Closing:
(a) Seller's Costs. Seller shall pay:
(i) The recording fee for recording all documents required to convey
marketable title to the Property, including the conservation fee due upon
recording the deed.
(ii) The state deed tax.
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(iii) The costs of the Title Commitment and exam fee shall be paid by Seller.
(iv) One-half of the closing fee charged by the Title Company.
(b) Buyer's Costs. Buyer shall pay:
(i) One-half of the closing fee charged by Title Company.
(ii) The premium for the Owner's Title Policy.
(iii) Recording costs for the deed.
(c) Legal Fees. Each party shall pay the fees and costs of their respective legal
counsel.
12. PRORATIONS. Real estate taxes, governmental use fees, area charges and the like
(collectively "Real Estate Taxes") due and payable in the year of Closing shall be prorated
between Seller and Buyer as of Closing Date, based upon a calendar year. Real Estate Taxes due
and payable in the year prior to the year of Closing shall be paid in full by Seller on or before the
Closing. Any Real Estate Taxes or special assessments which have been deferred and become or
will become due and payable as a result of the conveyance of the Property shall be paid in full by
Seller on or before the Closing. All special assessments levied and pending as of the date of
Closing shall be paid by Seller at Closing. An assessment shall be deemed pending if the assessing
authority has approved the improvement which will result in the assessment and has entered into a
contract to construct the improvement. All utilities and other operating costs of the Property will
be prorated between Seller and Buyer as of the Closing Date, sq that Seller pays that part of such
operating costs payable for dates before the Closing Date and Buyer pays that part of such
operating costs payable for dates after the Closing Date.
13. BROKERAGE. Buyer and Seller each represent to the other that they are not liable to
any broker or agent with regard to the sale contemplated hereby. Seller agrees to indemnify,
defend and hold harmless the Buyer from brokerage fees and commissions and from any claim
made by any broker or sales agent or similar party for a commission due under the terms of any
agreement entered into by the Seller, including without limitation reasonable attorneys' fees.
Buyer agrees to indemnify, defend and hold harmless the Seller from brokerage fees and
commissions and from any claim made by any broker or sales agent or similar party for a
commission due under the terms of any agreement entered into by the Buyer, including without
limitation reasonable attorneys' fees.
14. DEFAULT.
(a) Seller's Default. In the event that Seller should fail to consummate the
transactions contemplated herein for any reason, except the default by Buyer, Buyer may pursue
11
Hopcivil\MokabakaPL=haseAgreement.5.2.13
any remedies available to it under Minnesota law, including seeking specific performance of this
Agreement and recovering all costs, disbursement and attorneys' fees incurred in said specific
performance action.
(b) Buyer's Default. If Buyer should fail to consummate the transactions
contemplated herein for any reason, except the default by Seller, or the failure of any of the
contingencies or conditions to the Buyer's obligations set forth herein, the Seller may pursue any
remedies available to it under Minnesota law, including seeking specific performance of this
Agreement and recovering all costs, disbursement and attorneys' fees incurred in said specific
performance action.
15. MISCELLANEOUS. The following general provisions govern this Agreement.
(a) Time of Essence. Time is of the essence of this Agreement.
(b) Governing Law. This Agreement is made and executed under and in all respects
to be governed and construed by the laws of the State of Minnesota.
(e) Notices. Any notice required to be given to Seller or Buyer pursuant to this
Agreement shall be in writing and shall be deemed duly given at the date of delivery by messenger
or by recognized overnight courier, or one (1) business day after the date of mailing if sent by
certified mail, return receipt requested, to the addresses stated below. Any party, by notice given
as aforesaid, may change the address to which subsequent notices are to be sent.
If to Buyer: Housing and Redevelopment Authority in and for
the City of Hopkins
Atten: Kersten Elverum,
Director of Planning and Development
1010 lst Street South
Hopkins, MN 55343
with a copy 'o: Jeremy S. Steiner
Steiner & Curtiss, P.A.
400 Wells Fargo Bank Building
1011 First Street South
Hopkins, MN 55343
If to Seller: Mokabaka, LLC
Atten: Mr. Dan Dorholt
Snap Print
24 Shady Oak Raod
Hopkins, MN 55343
12
HopeiviAMokabakaPumbaseAgreement.5.2.13
(d) Buyer's Waiver Rights. Buyer, at its option, may waive any right conferred upon
the Buyer by this Agreement. Except as provided otherwise herein, such waiver may be made by,
and only by, giving Seller written notice specifically describing the right waived.
(e) Amendment. This Agreement shall be amended only by a written instrument
signed by Seller and Buyer.
(t) Construction.. The captions and headings of the various sections of this
Agreement are for convenience only and are not to be construed as defining or as limiting in any
way the scope or intent of the provisions hereof. Wherever the context requires or permits, the
singular shall include the plural, the plural shall include the singular and the masculine, feminine
and neuter shall be freely interchangeable.
(g) Assignment. Neither party shall have the right to assign its interest under this
Agreement, without first obtaining the consent of the other party, provided Buyer has signed
Buyer's rights under this Agreement without Seller's consent but only if Buyer remains liable for
Buyer's obligations hereunder.
(h) Invalidi . If for any reason any portion or section of this Agreement shall be
declared void and unenforceable by any court of law or equity it shall only affect such particular
portion or section of this Agreement and the balance of this Agreement shall remain in full force
and effect and shall be binding upon the parties hereto.
(i) Counterparts. This Agreement may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument and either of the parties
hereto may execute this Agreement by signing any such counterpart.
0) Merger/Survival. All prior understandings and agreements between the parties are
merged into this Agreement which alone fully and completely expresses their agreement. All
representations, covenants, obligations and agreements contained herein shall survive the Closing
and delivery of the Warranty Deed by Seller.
(k) Right of First Refusal. Seller expressly waives the right of first refusal provided by
'vhnn. Stat. 117.226 that requires Buyer to offer the Seller the first right to purchase any excess
land acquired pursuant to this Agreement.
16. TEWMINATION OF LEASES AND POST -CLOSING OCCUPANCY BY
SNAP PRINT, INC. Seller represents to Buyer that, as of the Effective Date, the Property is
subject to the following lease, and no others, namely:
13
HopcivilWokabakaPurchaseAgreement5.2.13
Name of Tenant Date of Lease Termination Date of Lease
Studio Tan, Inc., d/b/a
Studio Tan and Day Spa
Snap Print, Inc.
Month to Month
Month to Month
Seller represents to Buyer that the above tenants have no options to renew or extend the terms of
their leases and no rights of first refusal or options to purchase the Property that would affect
Seller's ability to perform its obligations under this Agreement. Seller acknowledges it has been
advised Buyer shall notify the above tenants Buyer is acquiring the Property and that their
tenancies shall be terminated in accordance with the Minnesota Uniform Relocation Assistance
Act.
Notwithstanding the provisions of the preceding paragraph, Buyer agrees that Seller's tenant, Snap
Print, Inc., a Minnesota corporation, will be entitled to remain in possession of the premises it
currently occupies within the building located on the Property after the Closing Date in accordance
with the terms and conditions of the Lease Agreement attached hereto as Exhibit C ("Snap Print
Lease'). The term of the Snap Print Lease shall commence on the Closing Date and terminate on
the "Termination Date" defined in Section 3 thereof. Buyer shall execute the Snap Print Lease on
the Closing Date, subject to and contingent upon the simultaneous execution thereof by Snap
Print, Inc.
17. REDEVELOPMENT CONTRACT. Reference is made to the Purchase And
Development Agreement attached to this Agreement as Exhibit D (the "Redevelopment
Contract"). Buyer and Seller have agreed that, effective as of the Closing Date, Buyer and Seller
shall execute and enter into the Redevelopment Contract, which provides that Seller shall act as
the redeveloper, accept title to and redevelop the Redevelopment Property identified therein (the
"Redevelopment Property") in accordance with the terms and conditions stated in the
Redevelopment Contract. The obligations of Buyer and Seller to enter into the Redevelopment
Contract shall be subject to and contingent upon satisfaction of all conditions and contingencies
stated in this Agreement, including, but not limited to, Buyer's acquisition of the Property and the
Adjacent Properties as of the Closing Date. The Redevelopment Contract shall provide that Seller
shall take title to the Redevelopment Property subject to a Lease in favor of Syndicate Sales
Corporation which Lease shall be terminable as provided in the Redevelopment Contract.
18. Subdivision of Property. Seller agrees Buyer shall be entitled to make application
to the City of Hopkins ("City") to subdivide the Property into the two parcels depicted in Exhibit
E attached hereto. Buyer shall promptly made application to the City for approval of a subdivision
of the Property into the two parcels depicted in Exhibit E attached hereto, and Buyer shall be
solely responsible for all costs associated with making application for and obtaining approval of
such subdivision. Seller agrees to execute such consents or applications as shall be required to
complete the subdivision of the Property as depicted in Exhibit E and to cooperate with Buyer in
14
Hopc ivi l\MokabakaPurr.haseAgreement.52.13
obtaining approval thereof, provided all expenses associated with such subdivision shall be paid
by Buyer. Seller and Buyer agree the subdivision of the Property shall not become final and shall
not be filed of record until the Closing of the transaction described in this Agreement has
occurred.
19. WAIVER OF RELOCATION ASSISTANCE AND COMPENSATION FOR
RIGHT-OF-WAY ACQUISITION. Seller acknowledges that, by receiving the Purchase Price,
Seller shall be fully and fairly compensated for the fair market value of all of the Property.
Therefore, Seller hereby waives any and all claims compensation or awards that would otherwise
have been payable for the acquisition of right-of-way by Hennepin County for Shady Oak Road .
Seller also hereby waives all relocation assistance payments or similar benefits to which Seller
might otherwise be entitled under state or federal law to the fullest extent permitted thereby. At
Closing, Seller shall execute and deliver to Buyer any documents that shall reasonably be required
to evidence such waivers by Seller.
20. IRC SECTION 1031 EXCHANGE. Buyer has been advised Seller may elect to
effectuate a like kind exchange transaction under Section 1031 of the Internal Revenue Code.
Buyer agrees to cooperate with Seller in effectuating Seller's Section 1031 Exchange, and agrees
Seller may assign Seller's interest in this Agreement to a "qualified intermediary" for that purpose,
provided Buyer shall not be required to incur or suffer, and Seller agrees to hold Buyer harmless
from any expense, liability or obligation in connection with Seller's Section 1031 Exchange.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
set forth after their signature below:
SELLER:
Mokabaka, LLC
Date: By:
Its:
Dated
I;Uri D1.41
The Housing and Redevelopment Authority
in and for the City of Hopkins
Eugene J. Maxwell, Chairman
Kersten Elverum, Assistant Executive Director
15
Hopcivi WokabakaPurchaseAgreement.5.2.13
EXHIBIT A
Legal Description of the Property
Address: 24 Shady Oak Road
Hopkins, MN 55343
Tax ID: 23-117-22-43-0017
Legal Description:
Lot 2, Block 1, Oak Ridge 2nd Addition, Hennepin County, Minnesota
Address: .20 Shady Oak Road
Hopkins, MN 55343
Tax ID: 23-117-22-43-0016
Legal Description:
Lot 1, and that part of the 8 foot alley adjoining said lot on the North side thereof
lying between extensions across it of the East and West lines of said lot, Block 1, Oak Ridge 2nd
Addition, Hennepin County, Minnesota
HopeivillMokabakaPucchaseAgieement.5,2.13
EXHIBIT B
Description Of Adiacent Properties
Address: 112 Shady Oak Road
Hopkins, MN 55343
Tax ID: 23-117-22-43-0022
Address: 120 Shady Oak Road
Hopkins, MN 55343
Tax ID: 23-117-22-43-0023
Address: 108 Shady Oak Road
Hopkins, MN 55343
Tax ID: 23-117-22-43-0021
Hopcivil\Mokaba)mPurchaseAgreement.52.13
EXHIBIT C
LEASE AGREEMENT
THIS LEASE AGREEMENT, made this day of , 2013, by and
between The Housing and Redevelopment Authority in and for the City of Hopkins, Minnesota, a
public body corporate and politic ("Landlord") and Snap Print, Inc., a Minnesota corporation
("Tenant");
WITNESSETH THAT:
1. DEFINITIONS. When used in this Lease Agreement the following words or
phrases shall have the following meanings:
BUILDING. Shall mean the commercial Building located on the Real Estate described in
Exhibit A attached hereto, the address of which is: 20 - 24 Shady Oak Road, Hopkins, MN
55343.
PURCHASE AND DEVELOPMENT AGREEMENT. Shall mean and refer to that
certain Purchase And Development Agreement between Landlord and Tenant's affiliated
entity; Mokabaka, LLC, a Minnesota limited liability company, by which Mokabaka, LLC,
is to construct certain Minimum Improvements, as defined in the Purchase And
Development Agreement upon the Redevelopment Property (as defined in the Purchase
And Development Agreement).
LEASED PREMISES. Shall mean all of the Building, with the exception of that part of
the Building occupied by Studio Tan, Inc. Tenant shall also have the non-exclusive right to
use the parking areas and appurtenances to the Building.
PROJECT. Shall mean and refer to the Leased Premises and the Real Estate. The Project
shall not include any part of the land transferred to Hennepin County for right-of-way
purposes by Landlord.
REAL ESTATE. Shall mean that certain parcel of Real Estate legally described in Exhibit
A hereto. The Real Estate shall not include any part of the land transferred to Hennepin
County for right-of-way purposes by Landlord.
THIS LEASE. Shall mean and refer to this Lease Agreement and all Exhibits attached
hereto.
2. DEMISE AND PREMISES. Subject to the terms and conditions of this Lease,
Landlord leases to Tenant, and Tenant hires and takes of and from Landlord the Leased Premises.
HopcivillMokabakaPwcbaseAgreement.5.2. ] 3
3. TERM. The Term of this Lease shall commence on , 2013 (the
"Commencement Date") and shall terminate on the date on which the Minimum Improvements
defined in the Purchase And Development Agreement have been substantially completed and are
ready for occupancy by Tenant (the ATermination Date@), unless this Lease shall be earlier
terminated as provided herein. Tenant agrees Tenant shall vacate the Leased Premises and take
occupancy of the Minimum Improvements defined in the Purchase And Development Agreement
upon substantial completion of such Minimum Improvements. In the event Mokabaka, LLC,
defaults in the performance of its obligations under the Purchase And Development Agreement
and the Purchase And Development Agreement is terminated in accordance with its terms and
conditions, this Lease and Tenant's rights to occupy the Leased Premises shall terminate ten (10)
business days after service of notice of termination on Tenant from Landlord.
4. BASE RENT. Tenant shall not be obligated to pay Landlord Base Rent during the
term of this Lease stated in Section 3.
5. OPERATING EXPENSES. Tenant shall pay, either directly or as a
reimbursement to Landlord, for the entire term of this Lease, as additional rent hereunder (in the
case of a reimbursement to Landlord), without deduction or set-off therefrom, payable at the same
time and location as the Base Rent, Tenant's Percentage (100%) of the following costs, expenses
and amounts (which are hereinafter collectively referred to as "Operating Expenses"):
a. All real estate taxes and installments of special assessments which shall accrue or
become a lien against, or are payable in respect of, any part of the Project during
the term of this Lease and all amounts payable under assessment agreements, gross
receipts taxes and taxes on rentals (other than income taxes) relating to the Project.
b. Subject to Tenant=s obligation to maintain and repair the premises as hereinafter
provided, all other costs and expenses, if any, which Landlord may incur in
maintaining and operating the Project regardless of whether such costs and
expenses may be expensed or capitalized for federal income tax purposes,
including, but not limited to, the costs of heating, cooling, sewer; water, utilities,
insurance (including but not limited to liability insurance and fire and casualty
insurance with rental abatement endorsement, boiler and pressure vessel insurance,
war risk insurance, builders risk insurance, and owners protective liability
insurance), security, landscaping, janitorial and cleaning services; recycling;
cleaning, maintaining, resurfacing, striping, repairing and snow removal of
walkways, driveways and parking areas; charges under maintenance and service
contracts; all supplies purchased for use in the Project; all maintenance and repair
costs, including expenses related to maintenance of the roof, structural and utility
systems of the Building; any equipment rental; any and all other reasonable costs of
maintaining and operating the Project regardless of whether such costs and
expenses may be expensed or capitalized for federal income tax purposes.
Hopeivil\MokabakaPurchaseAgreement5.2.13
Tenant shall assume responsibility for the performance or payment of the foregoing obligations,
Operating Expenses, with the exception of those that may only be paid by Landlord, in which case
Tenant shall reimburse Landlord for 100% of such Operating Expenses.
6. SERVICES AND UTILITIES. Tenant shall be solely responsible for providing
and paying for all services and utilities to the Leased Premises including, but not limited to,
heating, ventilating and air conditioning, janitorial and cleaning services, recycling and rubbish
removal, cleaning, maintaining and snow removal of walkways, driveways and parking areas,
exterior maintenance, repair and maintenance of the Leased Premises, including all repairs to
fixtures and improvements whether owned by Landlord or Tenant, maintenance of all utility
systems, and any and all services, utilities, maintenance and repairs, ordinary or extraordinary.
Landlord shall not be liable for, and there shall be no abatement of rent by reason of, failure to
furnish, or for delay or suspension in the availability of any services or utilities, regardless of the
cause thereof. Tenant shall pay, promptly when due, all charges for natural gas, electricity,
telephone, water, sanitary sewer and refuse disposal provided to Tenant or the Leased Premises.
7. USE OF PREMISES. Tenant agrees that it will use and occupy the Leased
Premises solely for the operation of Tenant's commercial printing business. Tenant will not use or
occupy the Leased Premises for any unlawful purpose and hereby assumes responsibility for and
agrees to comply with all present and future laws, ordinances, regulations and orders of federal,
state or local governmental units or agencies pertaining to the Leased Premises or the operation of
Tenant's business thereon. Tenant shall not cause or permit any unusual noise, odors or nuisance
in or about the Leased Premises and the Building and grounds nor shall Tenant permit any debris
or property of Tenant, its officers, employees or agents to be placed or left upon the Project (other
than within the Leased Premises). Landlord disclaims any warranty that the Leased Premises are
suitable for Tenant's use and Tenant acknowledges that it has had full opportunity to make its own
determination in this regard.
Tenant warrants that the operation of its business will not be harmful to the Building or the
mechanical equipment within the Building and Tenant shall be liable in the event of damage
arising from such harmful operation. In the event Landlord's insurance premiums are increased
above the standard Building rate as a result of Tenant's use of the Leased Premises, Tenant will
pay to Landlord as additional rent the amount of such increase.
In the event Tenant shall cause or permit any unusual noise, odor or nuisance or the storage
of any debris or property of Tenant, its officers, employees or agents, in or about the Leased
Premises or Project in violation of the terms of this Section 7, Landlord shall be entitled to take
any steps it deems reasonably necessary to correct or remove such violation and Tenant shall pay
Landlord, as additional rent hereunder, all costs and expenses incurred in such correction or
removal including all costs and expenses incurred in ascertaining which Tenant is responsible for
such violation.
Hopcivir\MokabakaP=haseAgreement.5.2.13
8. ASSIGNMENT AND SUBLETTING. Tenant will not assign, transfer, mortgage
or encumber its interest in this Lease or sublet or rent or permit occupancy or use of the Leased
Premises, or any part thereof by any third party; nor shall any assignment or transfer of this Lease
be effectuated by operation of law or otherwise, without in each such case obtaining the prior
written consent of Landlord, which consent which consent may be withheld in Landlord's sole
discretion.
Either of the following events shall be deemed to be an assignment of Tenant's interest in
this Lease:
a. Any transaction in which more than fifty percent (50%) of the legal or beneficial
ownership or control of Tenant is transferred, if Tenant is a corporation, limited
liability company, trust or partnership, or
b. The sale or transfer of all or substantially all of the business and assets of Tenant.
9. SUBORDINATION. Without the necessity of any additional document being
executed by Tenant for the purpose of effecting a subordination, this Lease shall be subject and
subordinate at all times to the lien of any mortgage which may now or hereafter encumber the
Project or Landlord's interest or estate therein; provided, however, that if the Landlord, any
mortgagee or holder of any mortgage elects to have Tenant's interest in this Lease be superior to
any such mortgage, then by notice to Tenant, this Lease shall be deemed superior, whether this
Lease was executed before or after said mortgage. Notwithstanding the foregoing, Tenant
covenants and agrees to execute and deliver upon demand any certificate or Subordination
Agreement evidencing such subordination or superiority of this Lease as may be requested by
Landlord or any mortgagee, provided, however, that any subordination by Tenant (under this
Section 9 or pursuant to a separate agreement) shall only be effective if Tenant has first received a
nondisturbance agreement from the Mortgagee, by which the Mortgagee shall agree not to disturb
Tenant's possession (provided Tenant is not in default under this Lease) and shall agree to honor
the terms of this Lease. Tenant further agrees that in the event that any proceedings are brought
for the foreclosure of any mortgage, Tenant shall attorn to the purchaser at the foreclosure sale and
recognize such purchaser as the Landlord under this Lease, if requested to do so by such
purchaser, provided that said purchaser agrees that Tenant's possession of the Leased Premises
shall not be disturbed so long as Tenant shall continue to perform all of the covenants and
conditions of this Lease, in which case Tenant's obligations to perform such covenants and
conditions shall not be in any way diminished thereby. Tenant further waives the provisions of
any statute or rule of law, now or hereafter in effect, which may give or purport to give Tenant any
right to terminate or otherwise adversely affect this Lease and the obligations of Tenant hereunder
in the event that any such foreclosure proceeding is prosecuted or completed.
Hopcivil\MokabakaP=haseAgreement5.2.13
10. SALE OF THE PROJECT/ESTOPPEL CERTIFICATES. In the event of a
sale of the Project, Landlord shall be relieved of all liability under this Lease accruing from and
after the date of sale provided Landlord has obtained the written agreement of its transferee or
assignee to assume and carry out all of the covenants and obligations of the Landlord hereunder.
Tenant agrees at any time and from time to time, upon not less than five (5) days' prior
written notice by Landlord, to execute, acknowledge and deliver to Landlord or a party
designated by Landlord a statement in writing (i) certifying that this Lease is unmodified and in
full force and effect, or if there have been modifications, that this Lease is in full force and effect
as modified and stating the modifications, (ii) stating the dates to which the Base Rent, Operating
Expenses and other charges hereunder have been paid by Tenant, (iii) stating whether or not
Landlord is in default in the performance of any covenant, agreement or condition contained in
this Lease, and, if so, specifying each such.default, (iv) agreeing that Tenant and Landlord will
not thereafter modify the Lease without the approval of any mortgagee identified by Landlord,
and (v) agreeing that, except for any security deposit required herein, Tenant shall not prepay
any rent more than thirty (30) days in advance, and (vi) such other matters relating to this Lease
as may reasonably be requested. Any such statement delivered pursuant hereto may be relied
upon by any owner of the Project, any prospective purchaser of the Project, any mortgagee or
prospective mortgagee of the Project or of Landlord's interest, or any prospective assignee of any
such mortgagee.
11. INSURANCE. Tenant agrees that it shall purchase in advance and carry the
following insurance at is own expense: a) "All Risk" fire and extended coverage insurance
insuring Tenant's personal property, furniture, trade fixtures, inventory, business record and
leasehold improvements against loss from all insurable events for the full replacement value
thereof; b) insurance against interruption of Tenant's business activities; c) comprehensive
general public liability insurance, providing coverage on an "occurrence" and, not a "claims
made" basis, covering all acts of Tenant, its employees, agents, representatives and guests and
insuring against all claims arising from injury to persons or damage to property in or about the
Leased Premises, Building or the Project in a single limit amount of not less than $2,000,000.00
for personal injury or death and not less than $500,000.00 for property damage and fire legal
liability.
All such insurance shall name Landlord as an additional insured and shall provide for
thirty (30) days written notice to Landlord prior to cancellation, non -renewal or material
modification. Certificates of all such insurance shall be delivered to Landlord prior to occupancy
of the Leased Premises by Tenant and at least thirty (30) days prior to the termination date of any
existing policy. Tenant shall pay to Landlord, upon demand, as additional rent the cost of
securing such insurance in the event Tenant fails to furnish certificates of insurance to Landlord.
However, it is not Landlord's duty nor obligation to secure such insurance for Tenant.
12. FIRE OR OTHER CASUALTY. If the Leased Premises shall be damaged or
destroyed by fire or other cause, Landlord shall at its sole option either (a) undertake to restore
such damage (provided, however, that Landlord shall not be required to spend amounts in excess
of insurance proceeds available to Landlord to effect such restoration), or (b) terminate this
Lease, by notice given to Tenant within sixty (60) days after the date of damage. If Landlord
HopcivillMotmbakaPutchaseAgreement. 5.2.13
elects to terminate this Lease, such termination shall be effective as of the date of the damage. If
Landlord elects to restore, Landlord shall not be obligated to restore any improvements to the
Leased Premises which were not owned and constructed by Landlord. Upon substantial
completion by Landlord of its work, Tenant shall undertake to restore its leasehold
improvements and trade fixtures with all due diligence. This Lease shall, unless terminated by
Landlord pursuant to this Section 12, remain in full force and effect following such damage, and,
the Base Rent, prorated to the extent that the Premises are rendered untenantable, shall be
equitably abated until such repairs are completed; provided, however, that if Tenant does not
restore its leasehold improvements and trade fixtures with due diligence, abatement shall cease
as of the date restoration could have been completed using due diligence.
13. CONDEMNATION. The Leased Premises does not include any part of the land
transferred by Landlord to Hennepin County for right-of-way for Shady Oak Road. Tenant shall
have not claim against Landlord or Hennepin County for relocation assistance benefits, loss of
business, costs of relocation or the value of Tenant's trade fixtures.
14. ALTERATIONS AND SIGNS. Tenant will not make or permit anyone to make
any alterations, additions or improvements, structural or otherwise, in or to the Leased Premises
or the Building without the prior written consent of Landlord, provided that Landlord shall not
unreasonably withhold such consent. As a condition precedent to written consent of Landlord
hereunder, Tenant agrees to obtain and deliver to Landlord such security against mechanic's liens
as Landlord shall reasonably request. If any mechanic's lien is filed against any part of the
Building or the Project for work claimed to have been done for or labor or materials claimed to
have been furnished to or authorized by Tenant, such mechanic's lien shall be discharged by
Tenant within ten (10) days thereafter, at Tenant's sole cost and expense, by the payment and
satisfaction thereof or by making any deposit required by law. Should Tenant fail to obtain the
discharge of any such mechanic's lien within ten (10) days of the filing thereof, Landlord shall be
entitled to obtain such discharge by whatever reasonable means Landlord deems expedient, and
all costs incurred by Landlord in obtaining such discharge including reasonable attorneys' fees,
shall be paid by Tenant as additional rent hereunder.
Tenant shall remove, at Tenant's sole expense, prior to the expiration or termination of
the term of this Lease, all movable furniture or trade fixtures installed in the Leased Premises
and shall restore or repair any damage to the Leased Premises caused by such removal.
Tenant shall not install any equipment which will or may necessitate any changes,
replacements or additions to, or in the use of, the heating, ventilating or air conditioning system,
or electrical system of the Leased Premises or the Project nor any equipment containing
Hazardous Materials or chlorofluorocarbons without obtaining the prior written consent of
Landlord.
15. WAIVER OF SUBROGATION. Notwithstanding any other provision in this
Lease to the contrary, Tenant hereby releases Landlord and Landlord=s commissioners, agents,
representatives and employees, from any and all liability or responsibility (to Tenant or anyone
claiming through or under Tenant by way of subrogation or otherwise) for any loss or damage
covered by insurance actually carried or coverable by the insurance required by Section 11
Hopcivil\MokabakaPuichaseAgreement5.2.13
hereof, even if such loss or damage shall have been caused by the fault or negligence of
Landlord, or anyone for whom Landlord may be responsible.
16. WAIVER AND INDEMNITY. Tenant agrees that Landlord and Landlord=s
commissioners, agents, representatives and employees shall not be liable to Tenant or those
claiming through or under Tenant for any personal injury, death or property damage occurring in,
on or about the Leased Premises, the Building or the Project except to the extent such injury,
death or property damage was caused by the intentional misconduct or negligence of Landlord,
its agents or employees. Without limitation of the foregoing, Landlord shall not be liable to
Tenant for any damage, compensation or claims arising from: loss or damage to books, records,
files, money, securities, negotiable instruments or other papers in or about the Leased Premises;
the necessity.of repairing any portion of the Project; the interruption in the use of the Leased
Premises; accident or damage resulting from the use or operation by Landlord, Tenant, or any
other person or persons whatsoever of elevators, or heating, cooling, electrical or plumbing
equipment or apparatus; the termination of this Lease by reason of the destruction or
condemnation of the Leased Premises; any fire, robbery, theft, or any other casualty; any leakage
or bursting of pipes or water vessels or any roof or wall leakage in any part or portion of the
Leased Premises or the Building; water, rain, snow or underground water that may leak into,
flow on, or flow from, any part of the Leased Premises or the Project.
Tenant agrees to indemnify and hold harmless Landlord and Landlord=s commissioners,
agents, representatives and employees from and against all claims, costs, liabilities and expenses,
of whatever nature a) arising or resulting from any act, omission or negligence of Tenant, its
officers, employees and agents in or about the Leased Premises, Building or the Project or, b)
arising in connection with Tenant's use or occupancy of the Leased Premises or the conduct of
Tenant's business thereon, and agrees to indemnify and hold harmless Landlord from and against
all costs, expenses and liabilities, including reasonable attorneys fees, incurred in connection
with any such claims or proceedings brought thereon, and the defense thereof.
17. REPAIRS AND MAINTENANCE. Tenant shall put, keep, repair and maintain
the Leased Premises and the fixtures and equipment therein at all times in a good, properly
functioning, safe and sanitary condition and state of repair, free of debris and other similar
obstructions, and Landlord shall have no responsibility for any repair, upkeep, maintenance,
improvement, alteration, or other work to or upon the Leased Premises of any kind or nature.
Tenant=s repair and maintenance obligations shall include, but are not limited to, the obligation
to: i) make all necessary repairs to the outer walls, roof, and structural elements of the Building,
ii) keep the plumbing, sewage, heating, air conditioning, electrical and ventilating systems of the
Building in good repair, ordinary wear and tear excepted, and iii) maintain and keep the common
areas, grounds, walkways, driveways and parking areas in a neat and clean condition. Tenant
shall pay for electric lamps and ballasts used in the Leased Premises. Any cost of repairs,
modifications, alterations or improvements to the Building, the Leased Premises or the Project
which are occasioned by the negligence or default of Tenant, its officers, employees, agents or
invitees, or by the requirements of law, ordinance or other governmental directive and which
arise out of the nature of Tenant's use and occupancy of the Leased Premises or the installations
of Tenant in the Leased Premises shall be paid solely by Tenant. Without limiting the foregoing,
Landlord shall have no obligation to maintain, repair or restore the Building, Leased Premises, or
HopcivilVMokabakaPurohaseAgreement.5.2. 13
any part or component thereof or improvements thereon. Tenant accepts possession of the
Building and the Leased Premises Aas is@ and Awhere is® and agrees that Tenant shall be
responsible for all maintenance, repair and upkeep of the Building, the Leased Premises and any
fixtures or improvements located thereon.
Tenant will not suffer or permit any waste or injury to the Leased Premises and will, at
the expiration of the term of this Lease, surrender the same with all walls, floor coverings and
other components thereof in the same order and condition as on the Commencement Date,
ordinary wear and tear, subsequent alterations or improvements consented to by Landlord as
provided in Section 14 of this Lease and casualty damage covered by insurance excepted.
18. ENTRY AND INSPECTION. Upon twenty-four (24) hours prior notice, except
in the case of emergencies, Tenant shall permit Landlord, its agents or representatives to enter
the Leased Premises to examine and inspect the same. Landlord shall make reasonable efforts
not to unreasonably interfere with the conduct of Tenant's business, but Landlord shall in no
event be liable to Tenant or those claiming under or through Tenant for any loss or damages in
connection with such entry or inspection.
19. IMPROVEMENTS. [INTENTIONALLY OMITTED]
20. WAIVER. No waiver by either party of any breach of any covenant, condition or
agreement herein contained shall operate as a waiver of such covenant, condition, or agreement
itself, or of any subsequent breach thereof. No payment by Tenant or receipt by Landlord of a
lesser amount than the monthly installments of rent herein stipulated shall be deemed to be other
than on account of the earliest stipulated rent nor shall any endorsement or statement on any
check or letter accompanying a check for payment of rent be deemed an accord and satisfaction,
and Landlord may accept such check or payment without prejudice to Landlord's right to recover
the balance of such rent, to terminate this Lease, to repossess the Leased Premises or to pursue
any other remedy provided in this Lease. No re-entry by Landlord, and no acceptance by
Landlord of keys from Tenant, shall be considered an acceptance of a surrender of this Lease or
the Leased Premises.
21. COVENANTS OF LANDLORD. Landlord covenants that it has the right to
make this Lease for the term aforesaid and covenants that if Tenant shall pay the rent and
perform all of the covenants, terms and conditions of this Lease to be performed by Tenant,
Tenant shall, during the term of this Lease freely, peaceably and quietly occupy and enjoy the
full possession of the Leased Premises. The term "Landlord" as used in this Lease shall mean
solely the owner of the Project. In case the original or any successor Landlord shall convey or
otherwise dispose of its entire interest in the Project and turn over to the transferee any funds
held by it hereunder in which Tenant has an interest, all liabilities of such Landlord under this
Lease shall terminate.
22. NO REPRESENTATIONS BY LANDLORD. Neither Landlord nor any agent,
employee or property manager of Landlord has made any representations with respect to the
Leased Premises or the Project except as herein expressly stated, and no right, privileges,
easements or licenses are acquired by Tenant except as herein expressly stated.
Hopcivil\MokabakaPucehaseAgreement_ 5.2.13
23. DEFAULT.
a. Any one of the following events shall constitute an Event of Default:
i) Tenant shall fail to pay any monthly installment of Base Rent or any other
sum due Landlord as herein provided;
fl) Tenant shall violate or fail to perform any of the other terms, covenants or
conditions of this Lease and such default shall continue for thirty (30) days
after notice from Landlord;
iii) Tenant shall file or have filed against it or any guarantor of this Lease any
bankruptcy or other creditor's action, or make an assignment for the
benefit of its creditors;
b. If an Event of Default shall have occurred and be continuing, Landlord may at its
sole option by written notice to Tenant terminate this Lease. Neither the passage
of time after the occurrence of the Event of Default nor exercise by Landlord of
any other remedy with regard to such Event of Default shall limit Landlord's
rights under this Paragraph 23, b).
C. If an Event of Default shall have occurred and be continuing, whether or not
Landlord elects to terminate this Lease, Landlord may enter upon and repossess
the Leased Premises (said repossession being hereinafter referred to as
"Repossession") by force, summary proceedings, unlawful detainer, ejectment or
otherwise, and may remove Tenant and all other persons and property therefrom.
d. From time to time after Repossession of the Leased Premises, whether or not this
Lease has been terminated, Landlord shall exercise reasonable efforts to relet the
Leased Premises for the account of Tenant in the name of Landlord or otherwise,
for such term or terms (which may be greater or less than the period which would
otherwise have constituted the balance of the Term) and for such terms (which
may include concessions or free rent) and for such uses as Landlord, in its sole
and unqualified discretion, may determine, and may collect and receive the rent
therefor. Landlord shall not be responsible or liable for any failure to collect any
rent due upon any such reletting. When used in this Paragraph 23, d), the phrase
"reasonable efforts to relet" shall mean and refer to commercially reasonable
efforts to relet the Leased Premises after all other vacant space in the Building has
been leased by Landlord upon such terms and conditions as Landlord, in its sole
discretion, may determine, and Landlord shall in no event be determined not to
have exercised reasonable efforts to relet for any period of time that is less than
one year after all comparable vacant space in the Building has been so leased.
e. No termination of this Lease pursuant to Paragraph 23, b) and no Repossession of
the Leased Premises pursuant to Paragraph 23, c) or otherwise shall relieve
Tenant of its liabilities and obligations under this Lease, all of which shall survive
H*dviAMokabekaPmahaseAgreement.52.13
any such termination or Repossession. In the event of any such termination or
Repossession, whether or not the Leased Premises shall have been relet, Tenant
shall pay to Landlord the Base Rent and other sums and charges to be paid by
Tenant up to the time of such termination or Repossession, and thereafter Tenant,
until the end of what would have been the term in the absence of such termination
or Repossession, shall pay to Landlord, as and for liquidated and agreed current
damages for Tenant's default, the equivalent of the amount of the Base Rent,
Operating Expenses and such other sums and charges which would be payable
under this Lease by Tenant if this Lease were still in effect, less the net proceeds,
if any, of any reletting effected pursuant to the provisions of Paragraph d) after
deducting all of Landlord's expenses in connection with such reletting, including
without limitation, all repossession costs, brokerage and management
commissions, operating expenses, legal expenses, reasonable attorneys' fees,
alteration costs, and expenses of preparation for such reletting. Tenant shall pay
such current damages to Landlord monthly on the days on which the Base Rent
would have been payable under this Lease if this Lease were still in effect, and
Landlord shall be entitled to recover the same from Tenant on each such day. At
any time, after such termination or Repossession, whether or not Landlord shall
have collected any current damages as aforesaid, Landlord shall be entitled to
recover from Tenant, and Tenant shall pay to Landlord on demand, as and for
liquidated and agreed final damages for Tenant's default, an amount equal to the
then present worth of the excess of the Base Rent, Operating Expenses and other
sums or charges reserved under this Lease from the day of such termination or
repossession for what would be the then unexpired term of this Lease if the same
had remained in effect, over the then net fair rental value of the Leased Premises
for the same period.
f. If an Event of Default shall have occurred and Landlord places in the hands of an
attorney the enforcement of all or any of the terms, covenants, agreements or
conditions of this Lease, the collection of any rent due or to become due, or the
recovery of possession of the Leased Premises, Tenant agrees to reimburse
Landlord, as additional rent hereunder, for Landlord's reasonable attorneys fees,
together with the actual cost of maintaining any action commenced in law or
equity by Landlord, whether suit is actually filed or not.
g. Landlord shall in no event be considered to be in default hereunder until the
expiration of a reasonable period of time after written notice of default from
Tenant. Tenant agrees that it will look solely to the interest of Landlord in the
Project and the rentals therefrom for the collection of any judgment or award
requiring the payment of money by Landlord in the event of any default by
Landlord in any of the terms, covenants or conditions of this Lease; and no other
assets of Landlord or its partners, officers, directors, members or shareholders
shall be subject to levy, execution or other legal process for the payment of
Tenant's claims.
Hopeivil\MokabakaPurrhaseAgreement.5.2.13
h. Tenant waives any demand for possession of the Leased Premises, demand for
payment of rent and notice of intent to re-enter, or of intention to terminate this
Lease, other than the notices provided in this Section 23.
24. SURRENDER. Tenant shall surrender the Leased Premises to Landlord upon
termination of this Lease, whether such termination occurs at the end of the lease term or sooner,
together with all utility systems, equipment, improvements, replacements, alterations and
decorations thereto and operating bulbs or tubes in all light fixtures, broom clean and in good
order, condition and repair except for ordinary wear and tear. Tenant shall remove promptly,
upon request by Landlord, alterations, modifications and the like to the Leased Premises made by
Tenant or on behalf of Tenant and shall restore and repair damage caused by such removal.
Should Tenant fail to surrender the Leased Premises in the condition required by this section,
Landlord shall be entitled to take whatever steps may, in Landlord's sole discretion, be required
to restore the Leased Premises to said condition and Tenant agrees that it shall pay to Landlord
all costs incurred by Landlord in so restoring the Leased Premises.
Notwithstanding any provision of this Lease to the contrary, Tenant shall remove all of Tenants
fixtures, equipment, inventory, supplies, materials, furnishings, personal property and debris
(collectively the Apersonal property and debris@) from the Project no later than the Termination
Date or such earlier date on which Tenant vacates the Leased Premises.
25. HOLDING OVER. Should the Tenant continue to occupy the Leased Premises,
or any part thereof, after the expiration or termination of the Term of this Lease whether with or
without the consent of the Landlord, such tenancy shall be from month to month and Tenant
shall pay Landlord the sum of $200.00 per day for each day Tenant continues in possession after
the Termination Date in addition to all other sums Tenant is obligated to pay pursuant to the
terms of this Lease during the entire period that Tenant continues to so occupy the Leased
Premises after the tern of this Lease.
26. LATE PAYMENT. Other remedies for nonpayment of rent notwithstanding and
without prejudice to such remedies, if Tenant fails to pay the Base Rent, Operating Expenses or
any other payment due hereunder, within the ten (10) days immediately following the date on
which such payment is due, Tenant shall pay to Landlord, as additional rent hereunder, interest
on all such past due payments at the rate of one percent (1 %) per month or at the maximum rate
permitted by law, whichever rate is lower. Interest shall accrue from the date each such late
payment became due and shall be payable to the date of payment thereof by Tenant.
27. SECURITY AND DAMAGE DEPOSIT. [INTENTIONALLY OMITTED]
28. HAZARDOUS SUBSTANCES AND ENVIRONMENTAL REGULATIONS.
a. When used in this Section 28, the terms "Environmental Regulations" and
"Hazardous Substances" shall have the following meanings:
i) Environmental Regulations shall mean and refer to the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42
Hopcivil\-MokabakaPurrcbaseAgreement.5.2.13
U.S.C. 9501 et seq., the Minnesota Environmental Response and Liability
Act, Minn. Stat. Chapter 115B, all amendments thereto, and all other laws,
acts, statutes, ordinances, rules, regulations, orders or determinations of
any governmental authority pertaining to or regulating Hazardous
Substances, Infectious Waste, asbestos, radiation, radioactive material,
health or the environment.
ii) Hazardous Substances shall mean and refer to all hazardous substances,
hazardous waste, toxic waste, asbestos, lead-based paint, solvents,
radiation, radioactive material, pollutants or contaminants as defined in or
regulated by Environmental Regulations.
Tenant warrants, represents and agrees that:
b. Its use of the Leased Premises, the Project, and the operation of its business
thereon, shall not violate any Environmental Regulations.
C. Tenant has obtained and shall continue to maintain all permits, licenses,
certificates or similar authorizations required by Environmental Regulations to
conduct its business on the Leased Premises and the Project. Tenant shall, upon
request therefore by Landlord, deliver to Landlord copies of all such permits,
licenses, certificates and authorizations.
d. Tenant's use of the Leased Premises will not result in the disposal, discharge,
emission or release of any Hazardous Substance on or about the Leased Premises,
Building or the Project or the contamination of any part of the Project thereby.
e. Upon request by Landlord, Tenant shall deliver to Landlord copies of all
contracts, programs, management plans or certifications regarding the generation,
storage, use, removal or disposal of Hazardous Substances which are required in
order for Tenant to be compliance with Environmental Regulations. Tenant shall,
upon request by Landlord, provide Landlord with copies of permits, inspection
reports, monitoring reports, licenses, orders, compliance requests or other
documentation filed, served, delivered or transmitted either with, to or from the
Minnesota Pollution Control Agency, Minnesota Department of Health or the
U.S. Environmental Protection Agency or other governmental body relating to
Tenant's use of Hazardous Substances in or about the Leased Premises or the
Project.
In the event Tenant, its officers, partners, agents, employees or subcontractors shall
breach or fail to perform any of the warranties, representations and agreements contained in this
Section, then, in addition to any other remedy Landlord may have under this Lease, at law or in
equity:
L Upon notice from Landlord, Tenant shall remove from the Leased Premises,
Building or the Project, at Tenant's sole expense, any Hazardous Substance,
Hopeivil\MokabakaPun haseAgreement.5.2.13
machinery or equipment which is not in compliance with Environmental
Regulations or this Lease Agreement;
g. Provided Landlord has a reasonable basis to believe Hazardous Substances have.
been discharged or released or any part of the Project has been contaminated
thereby, Landlord and such Environmental Engineers or consultants as it may
employ shall be entitled to enter upon the Leased Premises for the purpose of
conducting such environmental audits or similar tests as Landlord may deem
necessary and the cost and expense of such environmental audits or and tests
incurred by Landlord shall be paid by Tenant as additional rent hereunder with the
next installment of Base Rent; and
h. Tenant shall protect, indemnify and save Landlord harmless from all costs, fines,
claims, demands, actions, proceedings, judgments and damages (including court
costs and reasonable attorneys' fees) resulting from or arising out of any breach or
nonperformance by Tenant of the representations, warranties and agreements
contained in this Section 28 including, without limitation, the cost of removal
and/or remediation of any disposal, discharge, release or contamination of
Hazardous Substances on or about the Leased Premises, Building or the Project
resulting from the acts or omissions of Tenant, its managers, subtenants, agents
and employees.
It is expressly acknowledged by Tenant that all of the terms, covenants and conditions of this
Section 28, including, but not by way of limitation, the indemnifications herein provided shall
survive the termination of this Lease.
29. NOTICES. All notices or other communications hereunder shall be in writing
and shall be personally served upon the representative of Landlord or Tenant identified below or
sent by first class United States Mail, postage prepaid, or by a nationally -recognized overnight
delivery service, to the following address:
Landlord: The Housing and Redevelopment Authority
in and for the City of Hopkins, Minnesota
Attn: Executive Director
1010 First Street South
Hopkins, MN 55343
Tenant: Snap Print, Inc.
Attn: Dan Dorholt
24 Shady Oak Road
Hopkins, MN 55343
If notice is given by mail or by overnight delivery service, such notice shall be deemed to have
been given the day following one business day after the date of mailing or the date on which the
party giving notice delivers the notice to the overnight delivery service.
HopciviilMokabakaP=haseAgreement.5.2.13
30. MISCELLANEOUS.
a. This Lease is made and executed in the State of Minnesota, and shall be construed
according to the laws of Minnesota;
b. The invalidity or unenforceability of any provision of this Lease shall not affect or
impair the validity of any other provisions; and section titles and captions in this
Agreement are for convenience only and do not define, limit or construe the
contents of such sections and paragraphs;
C. If more than one person or entity shall sign this Lease as Tenant, the obligations
set forth herein shall be deemed joint and several obligations of each such party;
d. This Lease shall be binding upon and inure to the benefit of the parties thereto
and, subject to the restrictions and limitations herein contained, their respective
heirs, successors and assigns; and
Any modifications to this Lease must be in writing and signed by both Landlord
and Tenant.
f. Tenant shall not be eligible for any relocation assistance benefits or payments as a
result of its right to continue in occupancy and possession of the Leased Premises
under this Lease.
The remainder of this page has been intentionally left blank.
Signatures on the following page
Hopcivil\MokabakaPurchaseAgreement.5.2.13
IN WITNESS WHEREOF, the parties hereto have executed this Lease Agreement this
day of , 2013.
LANDLORD
TENANT
THE HOUSING AND REDEVELOPMENT SNAP PRINT, INC.
AUTHORITY IN AND FOR THE CITY OF
HOPKINS, MINNESOTA
By By
Its Its
Date:
Hopc ivi l\MokabakaPucchaseAgreement.5.2.13
Date:
EXHIBIT D
Copy of Purchase And Development Agreement
Hopcivil»vlokabakaPurchaseAd eemenL5.2.13
EXHIBIT E
Drawing Depicting Subdivision of Property
Hopcivil\MokabakaP=haseAgreement.5 2.13
HExhibit E - Replacement Property
This isnot a legally recorded map. It represents a compilation of of information and data from City, County. and Stat& road authorities and other sources.
5-31-13
PURCHASE AND
DEVELOPMENT AGREEMENT
By and Between
HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE
CITY OF HOPKINS
and
MOKABAKA LLC
Dated: 2013
This document was drafted by:
BRADLEY & DEIKE, P. A.
4018 West 65`3' Street, Suite 100
Edina, MN 55435
Telephone: (952) 926-5337
TABLE OF CONTENTS
Page
PREAMBLE 1
ARTICLE I
Definitions
Section I.I. Definitions 2
ARTICLE II
Representations
Section 2.1. Representations by the Authority 5
Section 2.2. Representations by the Redeveloper 5
ARTICLE III
Conveyance of Property
Section 3.1.
Development Proposal
7
Section 3.2.
Agreement to Sell
7
Section 3.3.
Conditions Precedent to Conveyance
7
Section 3.4.
Title
8
Section 3.5.
Demolition; Environmental Matters
9
Section 3.6.
Closing; Taxes
10
Section 3.7.
Access to Property
10
Section 3.8.
Copies of Reports
10
Section 3.9.
Lease of Acquired Property
11
ARTICLE IV
Construction of Improvements
Section 4.1. Construction of Minimum Improvements 12
Section 4.2. Construction Plans 12
Section 4.3. Commencement and Completion of Construction 13
(i)
Section 5.1. Insurance
Section 6.1. Prohibited Uses
ARTICLE V
Insurance
ARTICLE VI
Leasing Minimum Improvements
ARTICLE VII
Financing
Section 7.1. Financing
Section 7.2. Limitation on Encumbrance of Property
Section 7.3. Subordination
ARTICLE VIII
Prohibitions Against Assignment and Transfer; Indemnification
Section 8.1. Prohibition Against Transfer of Property and
Assignment of Agreement
Section 8.2. Release and Indemnification Covenants
ARTICLE IX
Events of Default
Section 9.1.
Events of Default Defined
Section 9.2.
Remedies on Default
Section 9.3.
Revesting Title in Authority
Section 9.4.
No Remedy Exclusive
15
16
17
17
17
I
19
19
19
19
Section 9.5. No Additional Waiver Implied by
One Waiver 20
Section 9.6. Effect of Termination of Agreement 20
Section 9.7. Costs of Enforcement 20
ARTICLE X
Additional Provisions
Section 10.1. Representatives Not Individually Liable
21
Section 10.2. Restrictions on Use
21
Section 10.3. Provisions Not Merged With Deed
21
Section 10.4. Titles of Articles and Sections
21
Section 10.5. Notices and Demands
21
Section 10.6. Disclaimer of Relationships
21
Section 10.7. Modifications
22
Section 10.8. Counterparts
22
Section 10.9. Judicial Interpretation
22
Section 10.10. No Business Subsidy
22
Section 10.11. Effect of Termination of Agreement
SCHEDULE A Description of Redevelopment Property and Syndicated Property
SCHEDULE B Deed
SCHEDULE C Purchase Agreement
SCHEDULE D Syndicate Lease
PURCHASE AND DEVELOPMENT AGREEMENT
THIS AGREEMENT, made on or as of the day of , 2013, by and
between the Housing and Redevelopment Authority in and for the City of Hopkins, a public
body corporate and politic (hereinafter referred to as the "Authority"), established pursuant to
Minnesota Statutes, 469.001-469.047 (hereinafter referred to as the "Act"), and having its
principal office at 1010 First Street South, Hopkins, Minnesota 55343, and Mokabaka LLC, a
Minnesota limited liability company (hereinafter referred to as the "Redeveloper"), having its
principal office at 24 Shady Oak Road, Hopkins, Minnesota 55343.
WITNESSETH:
WHEREAS, the Authority was created pursuant to Minnesota Statutes, sections 469.001-
469.047 (the "Act") and was authorized to transact business and exercise its powers by a
resolution of the City Council of the City of Hopkins (the "City") pursuant to the Act; and
WHEREAS, the Authority has established within the City its Redevelopment Project No.
1, a "redevelopment project" as defined in the Act, providing for the development and
redevelopment of certain areas located within the City (which redevelopment project is
hereinafter referred to as the "Project"); and
WHEREAS, the Authority and the Redeveloper have entered into a purchase agreement
(the "Purchase Agreement") under which the Authority has agreed, subject to certain conditions,
to purchase from Redeveloper and Redeveloper has agreed, subject to certain conditions, to sell
to the Authority certain property owned by the Redeveloper (the "Acquired Property"); and
WHEREAS, as additional consideration for the sale by the Redeveloper of the Acquired
Property to the Authority the Authority has agreed to convey another parcel of property acquired
by the Authority (the "Redevelopment Property"); and
WHEREAS, the Redeveloper has agreed that after the Authority conveys the
Redevelopment Property to the Redeveloper the Redeveloper will demolish the improvements
located on the Redevelopment Property and construct a new commercial building on the
Redevelopment Property; and
WHEREAS, the Authority and the Redeveloper desire to enter into this Agreement to set
forth the terms under which the Authority will convey the Redevelopment Property to the
Redeveloper and the Redeveloper's obligations to develop such property through the
construction of improvements thereon.
NOW, THEREFORE, in consideration of the mutual covenants and obligations of the
parties hereto, each of them does hereby covenant and agree with the other as follows:
ARTICLE I
Definitions
Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears
from the context:
"Acquired Property" means the real property to be acquired by the Authority from the
Redeveloper pursuant to the Purchase Agreement, which real property is described in the
Purchase Agreement.
"Act" means Minnesota Statutes, Sections 469.001-469.047, as amended.
"Agreement" means this Agreement, as the same may be from time to time modified,
amended, or supplemented.
"Authority" means the Housing and Redevelopment Authority In and For the City of
Hopkins, or any successor or assign.
"City" means the City of Hopkins.
"County" means Hennepin County, Minnesota.
"County Project" means the expansion and upgrading of Shady Oak Road by the County.
"Deed" means the quit claim deed in the form attached hereto as Schedule B.
"Development Plans" means those plans including site, grading, storm water management,
utility, landscape, building floor plan and building exterior elevations for the Minimum
Improvements that are required for municipal land use and watershed district approvals that may
include planned unit development agreement, conditional use permits, rezoning, platting, and
variances.
"Environmental Assessment" means the phase one environmental assessment obtained by
the Authority concerning the Redevelopment Property and described in Section 3.5 of this
Agreement.
"Event of Default" means an action listed in Section 9.1 of this Agreement.
"Holder" means the owner of a Mortgage.
"Hazardous Substances" means asbestos, urea formaldehyde, polychlorinated biphenyls,
nuclear fuel or materials, chemical waste, radioactive materials, explosives, known carcinogens,
petroleum products and also all dangerous, toxic or hazardous pollutants, contaminates,
chemicals, materials or substances defined as hazardous or as a pollutant or contaminant in, or
the release or disposal of which is regulated by, any Laws or Regulations, as hereafter defined.
2
Laws or Regulations mean and include the Comprehensive Environmental Response and
Liability Act ("CERCLA" or the Federal Superfund Act) as amended by the Superfund
Amendments and Reauthorization Act of 1986 ("SARA") 42 U.S.C. 9601-9675; The Federal
Resource Conservation and Recovery Act of 1986 ("RCRA"); the Clean Water Act, 33 U.S.C.
1321, et seq.; the Clean Air Act 42 U.S.C. 7401, et seq., all as the same may be from time to time
amended, and any other federal, state, county, municipal, local or other statute, law ordinance or
regulation which may relate to or deal with human health or the environment including, without
limitation, all regulations promulgated by a regulatory body pursuant to any such statute, law or
ordinance.
"Minimum Improvements" means a commercial building of at least 10,000 square feet
together with related and incidental improvements to be constructed by the Redeveloper on the
Redevelopment Property in accordance with the Development Plans and this Agreement.
"Mortgage" means any mortgage made by the Redeveloper which is secured, in whole or
in part, by the Redevelopment Property and which is a permitted encumbrance pursuant to the
provisions of Article VIII of this Agreement.
"Permitted Encumbrances" means reservations of minerals or mineral rights to the State of
Minnesota; public utility, roadway and other easements which will not prevent the development
and use of the Redevelopment Property pursuant to the Redeveloper's Development Plans;
applicable building laws, regulations and ordinances; real estate taxes that Redeveloper agrees to
pay or assume pursuant to this Agreement; restrictions, covenants and easements of record that
do not adversely affect the development and use of the Minimum Improvements; encroachments
of any buildings or improvements located on the Redevelopment Property that are to be
demolished in order to construct the Minimum Improvements; exceptions to title to the
Redevelopment Property which are not found objectionable by Redeveloper upon examination of
the abstract of title or the title insurance commitment to be delivered to the Redeveloper pursuant
to Section 3.4 of this Agreement; the reversionary clause described in Section 9.3 of this
Agreement, the Syndicate Lease, sightline easement and temporary construction easements to be
granted to the County for the construction of the County Project, and the terms and provisions of
this Agreement.
"Project" means the Authority's Redevelopment Project No. 1.
"Project Area" means the real property located within the boundaries of the Project.
"Purchase Agreement" means that certain Purchase Agreement between the Authority, as
buyer, and Redeveloper, as seller, dated as of , 2013, a true and correct copy of
which is attached to this Agreement as Schedule C.
"Purchase Price" means the amount to be paid by the Redeveloper to acquire the
Redevelopment Property from the Authority as described in Section 3.2 of this Agreement.
"Redeveloper" means Mokabaka LLC, a Minnesota limited liability company, its
successors and assigns.
"Redevelopment Property" means the real property described in Schedule A of this
Agreement.
"Site Plan" means the preliminary Site Plan which has been provided to the City and
Authority, which shows the proposed location of the Minimum Improvements.
"State" means the State of Minnesota.
"Syndicate" means Syndicate Sales Corporation, a Minnesota corporation.
"Syndicate Lease" means the lease to be entered into between the Authority and Syndicate
at the time of the closing on the Authority's purchase of the Syndicate Property, the form of
which lease is attached hereto as Schedule D.
"Syndicate Property" means that portion of the Redevelopment Property owned by
Syndicate and legally described as Lot 9, Block 1, Oak Ridge 2nd Addition, Hennepin County,
Minnesota.
"Unavoidable Delays" means delays which are the direct result of acts of God, unforeseen
adverse weather conditions, 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 enforcing its rights under this Agreement) which directly result in
delays.
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ARTICLE II
Representations
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 a municipal housing and redevelopment authority organized and
existing under the Act. Under the laws of the State, the Authority has the power to enter into this
Agreement and to perform its obligations hereunder.
(b) The Redevelopment Property is directly accessible to city sanitary sewer, storm
sewer, and water of adequate capacity for the construction of the Minimum Improvements.
(c) To the best of the Authority's knowledge and belief, at the time of execution by the
Authority of this Agreement, there are no environmental proceedings, applications, ordinances,
petitions, court pleadings, resolutions, investigations by public or private agencies, or other
matter pending which could prohibit, impede, delay or adversely affect the use of the
Redevelopment Property for the construction and use of the Minimum Improvements.
(d) To the best of the Authority's knowledge and belief, no investigation,
administrative order, consent order or agreement, litigation, or settlement with respect to
Hazardous Substances is proposed, threatened, anticipated or in existence with respect to the
Redevelopment Property.
(e) There is not pending, nor to the best of the Authority's knowledge is there
threatened, any suit, action or proceeding against the Authority before any court, arbitrator,
administrative agency or other governmental authority that materially and adversely affects the
validity of any of the transactions contemplated hereby, the ability of the Authority to perform its
obligations hereunder, or as contemplated hereby or thereby, or the validity or enforceability of
this Agreement.
(f) To the Authority's best knowledge, except as disclosed in the Environmental
Assessments defined in Section 3.5(a), there are no underground tanks located on the
Redevelopment Property.
(g) Except as disclosed in the Environmental Assessments defined in Section 3.5(a) or
as may be implied from past uses of the Redevelopment Property disclosed in the Environmental
Assessments, the Authority has no actual knowledge of the use of any Hazardous Substances on,
under, or in the Redevelopment Property.
(h) Except for the rights of Syndicate described in Section 4.2(f), any and all leases the
Redevelopment Property shall be terminated and the tenants thereunder shall have vacated the
Redevelopment Property prior to the date of closing. The Authority and/or the landlord under
any such leases shall have delivered any notice of termination to the tenants required under the
terms of the applicable leases and such termination shall be effective prior to the date of closing.
Section 2.2. Representations by the Redeveloper. The Redeveloper represents that:
(a) The Redeveloper is a limited liability company duly organized and in good
standing under the laws of the State, is not in violation of any provisions of its articles of
organization, member control agreement or the laws of the State, has the 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 the Minimum Improvements in accordance with
the terms of this Agreement and all local, state and federal laws and regulations (including, but
not limited to, environmental, engineering, zoning, building code and public health laws and
regulations), except for variances necessary to construct the improvements contemplated in the
Development Plans approved by the Authority.
(c) Neither the execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby, nor the fulfillment of or compliance with the terms and
conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of,
the terms, conditions or provisions of any 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.
All representations set forth in Section 2.1 and 2.2. of this Agreement shall be true and correct in
all material respects as of the date of closing on conveyance of the Redevelopment Property to
the Redeveloper.
ARTICLE III
Conveyance of Property
Section 3.1. Development Proposal. The Authority and Redeveloper have entered into the
Purchase Agreement under which the Authority has the right to purchase the Acquired Property
from the Redeveloper. The Authority has also entered into purchase agreements with the owners
of the Redevelopment Property under which the Authority has the right to purchase the
Redevelopment Property. After the Authority acquires the Acquired Property and the
Redevelopment Property, the Authority agrees that it will, subject to the terms and provisions of
this Agreement, sell the Redevelopment Property to the Redeveloper. The Redeveloper agrees
that after the Authority conveys the Redevelopment Property to the Redeveloper, the
Redeveloper will construct the Minimum Improvements on the Redevelopment Property.
3.2 Agreement to Sell. (a) In consideration of the covenants hereinafter set forth and
other valuable consideration, the sufficiency of which is hereby acknowledged, the Authority
agrees to sell and the Redeveloper agrees to buy the Redevelopment Property.
(b) The Purchase Price to be paid by the Redeveloper to acquire the Redevelopment
Property shall be $1.00. The Purchase Price shall be payable in cash at the time of the
conveyance of the Redevelopment Property to the Redeveloper.
Section 3.3. Conditions Precedent to Convey The Authority's obligation to convey
the Redevelopment Property to the Redeveloper and the Redeveloper's obligation to purchase
the Redevelopment Property shall be subject to satisfaction of all of the following conditions
precedent:
(a) The Redeveloper having obtained the requisite approval of the Authority hereunder
and all applicable governmental agencies and instrumentalities, municipal, county, state and
federal, to the development of the Redevelopment Property through the construction of the
Minimum Improvements in accordance with the Redeveloper's Development Plans, including,
without limitation, city approval of storm water, sanitary sewer and water utilities.
(b) The Redeveloper having obtained the following to the extent required: (i)
amendments, revisions, exceptions or changes as may be necessary to applicable zoning codes
and ordinances; (ii) planned unit development or other necessary land use approvals from the
City for the Minimum Improvements, (iii) watershed district approval; (iv) roadway access rights
and permits; (iv) environmental consents, if necessary; (v) approval of the replatting of the
Redevelopment Property; and (vi) all other governmental approvals that are necessary in order to
allow the construction and operation of the Minimum Improvements in accordance with the
Redeveloper's Development Plans.
(c) The Redeveloper having reviewed and approved, or waived any objections to, title
to the Redevelopment Property pursuant to Section 3.4 of this Agreement.
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(d) The Redeveloper having provided to the Authority evidence that the Redeveloper
has a firm commitment for financing or has available funds sufficient to finance the acquisition
of the Redevelopment Property and construction of the Minimum Improvements.
(e) The Redeveloper having satisfied itself that the soil conditions on the
Redevelopment Property are acceptable for its purposes.
(f) The Authority having acquired the Redevelopment Property and there are no
restrictions, adverse claims, encumbrances, or actions that would prevent or delay immediate
commencement of construction of the Minimal Improvements, including without limitation, any
leases of the Redevelopment Property that are effective, except for the rights of Syndicate
described in Section 4.2(f), regardless of whether notice of termination has been delivered to the
tenant, any parties who are in possession of the any or all of the Redevelopment Property, or any
protests or lawsuits against the Authority, City or County contesting the redevelopment and
planned expansion of the right-of-way adjacent to the Redevelopment Property..
(g) Except as described in Section 4.2(f) with respect to the Syndicate Property, all
occupants of the Redevelopment Property having been relocated from the Redevelopment
Property.
(h) The Authority's Board of Commissioners having approved the sale of the
Redevelopment Property to the Redeveloper following a public hearing on the question.
(i) The Redeveloper having entered into the parking arrangement described in Section
4.2(g) of this Agreement.
0) All contingencies under the Purchase Agreement for the Acquired Property have
been satisfied or waived and the parties thereto are prepared to, or have, closed on the sale of the
Acquired Property to the Authority.
(k) All representations and warranties of the Authority under Section 2.1 hereof shall
be accurate and correct as of the date of closing.
The Redeveloper agrees that it will take all commercially reasonable actions necessary to satisfy
the above conditions on or before the date that is six (6) months from the date of this Agreement.
In the event that all of the above conditions precedent have not been satisfied, or waived in
writing by both the Authority and Redeveloper, on or before six (6) months from the date of this
Agreement, either the Authority or Redeveloper may terminate this Agreement by giving written
notice of termination to the other party, whereupon this Agreement shall be null and void and the
Redeveloper and Authority shall execute an instrument in recordable form canceling this
Agreement. Approval by the Authority or City of any documents submitted to it by the
Redeveloper to satisfy the conditions precedent stated in this Agreement shall be in the
reasonable discretion of the City and the Authority, respectively. The Authority agrees that it
will hold a public hearing on the sale of the Redevelopment Property to Redeveloper on June 18,
2013.
3.4 Title. The Authority shall, within a reasonable time after the date hereof, furnish to
the Redeveloper an updated abstract of title or, at the Authority's option, a commitment for an
Owner's Policy of Title Insurance with copies of all documents constituting liens or
encumbrances referred to therein. If a commitment is issued such commitment shall be issued by
Commercial Partners Title in the amount of the market value of the Redevelopment Property,
which market value is $ , and shall:
(a) set forth the state of title to the Redevelopment Property together with all exceptions
and conditions to title, including without limitation, all easements, restrictions, rights
of way, covenants, reservations, consents and all other encumbrances affecting the
Redevelopment Property which would appear in the American Land Title
Association ("ALTA") Owner's 1992 Standard Form title insurance policy to be
issued at the time of conveyance of the Redevelopment Property;
(b) include searches covering bankruptcy and state and federal judgments and liens;
and
(c) commit to waive or insure against facts which would be disclosed by a
comprehensive survey of the Redevelopment Property, rights and claims of parties
in possession, and mechanic's and materialmen's liens and lien claims subject to
compliance with customary conditions of closing.
The Redeveloper shall be allowed thirty (30) days after receipt thereof and the survey
information referenced below, whichever is later, for examination of said title and the making of
any objections thereto. Such objections shall be made in writing or shall be deemed waived. If
any objections are so made, the Authority shall undertake all commercially reasonable actions to
cure such objection within ninety (90) days from notice thereof to cure, or cause to be cured the
title defect or exception, either by the removal thereof or by the procurement of title insurance
endorsements satisfactory to Redeveloper providing coverage against loss or damage as a result
of such defect or exception. During any period where the Authority is undertaking to cure an
objection, the time provide for in paragraph 3.3 (e) hereof shall be extended for a like period. If
the Authority does not cure or cause to be cured such title defect or exception to Redeveloper's
satisfaction within said ninety (90) days, the Redeveloper may, at its option, either (i) terminate
this Agreement upon written notice to the Authority upon which this Agreement shall be null and
void and the Redeveloper and the Authority shall execute an instrument in recordable form
canceling this Agreement; or (ii) proceed to close on the acquisition of the Redevelopment
Property in which event the title defect shall be deemed waived. If the Redeveloper proceeds to
acquire the Redevelopment Property, the Authority shall have no further obligations with respect
to any such defects or exceptions.
If the Authority has furnished the Redeveloper with a title commitment, ten (10) days prior to
closing on the conveyance of the Redevelopment Property to the Redeveloper the Authority shall
cause an updated title commitment to be furnished to the Redeveloper.
The Authority has furnished to the Redeveloper all surveys that the Authority has in its
possession concerning the Redevelopment Property. To the extent that the Redeveloper desires
an additional survey it will be responsible for obtaining it.
Section 3.5 Demolition; Environmental Matters. The Redeveloper agrees that if the
Redevelopment Property is conveyed to the Redeveloper it will be responsible for the demolition
of all structures and improvements located on the Redevelopment and any necessary remediation
of adverse environmental conditions on the Redevelopment Property. The Redeveloper agrees
that it will undertake such demolition and remediation within a time period that will allow the
Redeveloper to meet the construction schedule specified in Section 4.3. The Authority will
provide to the Redeveloper copies of any environmental assessments that it causes to be prepared
regarding the Redevelopment Property. The Authority will reimburse the Redeveloper for the
actual cost of such demolition and remediation activities. The Authority shall have the right,
prior to commencement of the demolition and remediation activities, to review and approve the
scope of the demolition and remediation work and to approve the bids received by the
Redeveloper from contractors bidding on such work.
Section 3.6 Closing; Taxes. (a) Closing on the conveyance of the Redevelopment Property
to the Redeveloper shall occur on or before a date that is thirty (30) days after the satisfaction, or
waiver, of the conditions precedent set forth in Section 3.3 of this Agreement.
(b) At closing on conveyance of the Redevelopment Property, the Authority shall
deliver to the Redeveloper: (i) the Deed duly executed and acknowledged, in recordable form,
conveying to the Redeveloper marketable title to the Redevelopment Property subject only to
Permitted Encumbrances; (ii) the abstract or title insurance policy described in Section 3.4 (the
premium for which shall be paid by Redeveloper, the costs of obtaining the commitment for
which shall be paid by the Authority); and (iii) a Seller's Affidavit, in customary form, relative to
judgments, federal tax liens, mechanic's liens and outstanding interests in the Redevelopment
Property.
(c) At the time of conveyance of the Redevelopment Property, the Redeveloper shall
deliver to the Authority the Purchase Price in the manner set- forth in Section 3.2 of this
Agreement.
(d) Real estate taxes due and payable in the year of closing shall be apportioned
between the Redeveloper and the Authority as of the date of closing on the conveyance of the
Redevelopment Property, with the result that the Authority shall pay that portion of such taxes
attributable to the period of the year prior to the conveyance and the Redeveloper shall pay that
portion of the taxes attributable to the period of time commencing with the date of conveyance.
Real estate taxes and assessments due and payable in the year 2012 and all prior years and
deferred real estate taxes (i.e. Green Acres), if any, shall be paid by the Authority. All levied and
pending unpaid special assessments shall be paid by
Section 3.7. Access to Property. During the term of this Agreement, the Authority will use
its best efforts to cause the current owners of the Redevelopment Property to permit Redeveloper
and its agents and contractors to access he Redevelopment Property at reasonable times for the
10
purpose of architectural inspection and design studies, the preparation of a survey, and the taking
of such soil borings and environmental assessments as are deemed reasonably necessary by
Redeveloper. The Redeveloper hereby agrees to indemnify, defend, and hold harmless the
Authority, its officers, agents, employees and commissioners from and against any and all
damage to property or injury to person arising out of the Redeveloper's exercise of its right of
access to the Redevelopment Property under this Section. The Redeveloper shall be entitled to
actual possession of the Redevelopment Property on the date of closing on conveyance of the
Redevelopment Property to the Redeveloper. Except as expressly stated herein, the Authority
makes no representations whatsoever as to the condition of the Redevelopment Property or the
soils thereon or that the same is suitable for the Redeveloper's proposed development. If the
Redeveloper determines to proceed with its acquisition of the Redevelopment Property it will
buy such property "as is", and the Authority shall have no liability to the Redeveloper on account
of any defects with respect thereto.
Section 3.8. Copies of Reports. In the event that there occurs an Event of Default by the
Redeveloper or if the Redeveloper fails to complete the construction of the Minimum
Improvements, the Redeveloper shall furnish to the Authority, at no cost to the Authority, copies
of all reports, assessments, studies, surveys and other documentation prepared on behalf of the
Redeveloper in connection with its proposed acquisition of the Redevelopment Property.
Section 3.9. Lease of Acquired Property. The Redeveloper's affiliated business entity,
Snap Print, Inc., currently operates a business on the Acquired Property and intends to move that
business to the Minimum Improvements when construction of the Minimum Improvements is
completed. The Authority is willing to allow the Redeveloper to continue to occupy the
Acquired Property until the Redeveloper has completed construction of the Minimum
Improvements. Therefore, at the time of closing on the conveyance of the Acquired Property to
the Authority pursuant to the Purchase Agreement the Authority and Snap Print, Inc., will enter
into a lease, in the form of the lease attached to the Purchase Agreement as Exhibit C.
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Ulm [a of so VAI
Construction of Improvements
Section 4.1. Construction of Minimum Improvements. The Redeveloper agrees that it will
construct the Minimum Improvements on the Redevelopment Property in accordance with the
approved Development Plans. Additionally, Redeveloper and its successors or assigns will
operate and maintain, preserve and keep the Minimum Improvements or cause the Minimum
Improvements to be maintained, preserved and kept with the appurtenances and every part and
parcel thereof, in good repair and condition.
Section 4.2. Development Plans. (a) The Authority's willingness to convey the
Redevelopment Property to the Redeveloper is predicated upon and subject to the Redeveloper's
agreement that it will construct the Minimum Improvements and that the Minimum
Improvements will be of such quality and nature as will satisfy the Authority's and City's goals
for the redevelopment of the Redevelopment Property. The Redeveloper understands that the
building being constructed as part of the Minimum Improvements must be at least 10,000 square
feet in size. On or before a date that will allow the conditions contained in subsections 3.3(a)
and (b) to be satisfied within six (6) months from the date of this Agreement, the Redeveloper
shall submit to the City and the Authority applications, together with supporting documentation,
for planned unit development and/or variance approvals, site plan and concept review, and a
preliminary and final plat of the Redevelopment Property as required to permit construction of
the Minimum Improvements; provided that the Authority will be responsible for initiating the
process to plat the Redevelopment Property.
(b) The Redeveloper understands that as a part of the City's planned unit development
approval process the Redeveloper may be required to enter into a planned unit development
agreement detailing the manner in which the Redeveloper will carry out certain aspects of the
construction of the Minimum Improvements. In the event that any term contained in this
Agreement is inconsistent with any term contained in the planned unit development agreement,
the terms of the planned unit development agreement shall govern.
(c) Within a period of time that will allow the Redeveloper to satisfy the condition
contained in subsections 3.3(a) and (b), taking into account the time necessary for review by the
Authority and City, the Redeveloper shall provide to the Authority and the City for their review
and approval Development Plans for the Minimum Improvements and documentation necessary
to obtain all other land use approvals that must be obtained prior to the construction and
operation of the Minimum Improvements. The Development Plans and other documentation
shall provide for the construction of the Minimum Improvements and shall be in conformity with
this Agreement, and all applicable state and local laws and regulations. The Authority shall
approve the Development Plans and other documentation in writing if, in the sole discretion of
the Authority, the proposed Minimum Improvements, including the building materials proposed
to be used, are of such a nature and quality as to justify the Authority's conveyance of the
Redevelopment Property and if they are consistent with the provisions of this Agreement. Such
Development Plans and other documentation shall, in any event, be deemed approved by the
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Authority, but not the City, unless rejected in writing by the Authority, in whole or in part within
thirty (30) days after the date of their receipt by the Authority.
(d) Nothing in this Agreement shall be deemed to relieve the Redeveloper of its
obligation to comply with the requirements of the City's normal land use approval process.
(e) If the Redeveloper desires to make any material change in any Development Plans
after their approval by the Authority, the Redeveloper shall submit the proposed change to the
Authority for its approval. If the Development Plans, as modified by the proposed change,
conform to the requirements of this Agreement and such changes do not materially alter the
nature, quality or exterior appearance of the Minimum Improvements, the Authority shall
approve the proposed change and notify the Redeveloper in writing of its approval. Any
requested change in the Development 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.
(f) Syndicate currently operates a business on the Syndicate Property. Pursuant to
the purchase agreement between the Authority and Syndicate, at the time of the closing on the
Authority's purchase of the Syndicate Property, the Authority and Syndicate will enter into the
Syndicate Lease under which Syndicate will lease and occupy the Syndicate Property until the
Redeveloper completes construction of the Minimum Improvements and relocates its business
from the Acquired Property to the Minimum Improvements. When the Redeveloper vacates the
Acquired Property a portion of the building located on the Acquired Property will be demolished
and Syndicate will relocate to the building remaining on the Acquired Property. The
Redeveloper and its contractors have determined that leaving the Syndicate Property occupied
during this period of time will not prevent the development of the Minimum Improvements.
(g) As part of the Minimum Improvements the Redeveloper will construct parking
spaces for the Minimum Improvements. The Authority is undertaking the acquisition of the
Acquired Property and the Redevelopment Property using funds under a program that requires
that the parking constructed on the Redevelopment Property be shared parking. Therefore, prior
to and as a condition to the conveyance of the Redevelopment Property to the Redeveloper, the
Redeveloper agrees that it will enter into a written arrangement with the owners of the VFW
facility located adjacent to the Redevelopment Property allowing the VFW and its patrons to use
the parking to be constructed on the Redevelopment Property. The parking arrangement may be
terminable upon the transfer by the VFW of its property to another entity.
Section 4.3. Commencement and Completion of Construction. Subject to Unavoidable
Delays, the Redeveloper shall commence construction of the Minimum Improvements within
thirty (30) days after conveyance of the Redevelopment Property to the Redeveloper and shall
complete construction the Minimum Improvements within one (1) year after commencement of
construction.
The Redeveloper agrees that it shall promptly begin and diligently prosecute to completion
construction of the Minimum Improvements within the periods specified in this Section. Until
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construction of the Minimum Improvements has been completed, the Redeveloper shall make
construction progress reports, at such times as may reasonably be requested by the Authority as
to the actual progress of the Redeveloper with respect to such construction.
14
ARTICLE V
Insurance
Section 5.1. Insurance. The Redeveloper will provide and maintain or cause its
contractors and subcontractors and at all times during the process of constructing the Minimum
Improvements and, from time to time at the request of the Authority, furnish the Authority with
proof of payment of premiums on:
(i) Builder's risk insurance, written on the so-called "Builder's Risk -- Completed
Value Basis," in an amount equal to one hundred percent (100%) of the insurable value of
the Minimum Improvements at the date of completion, and with coverage available in
nonreporting form on the so called "all risk" form of policy; and
(ii) Comprehensive general liability insurance (including operations, contingent
liability, operations of subcontractors, completed operations, Broadening Endorsement
including contractual liability insurance) together with an Owner's Contractor's Policy with
limits against bodily injury and property damage of not less than $2,000,000 for each
occurrence (to accomplish the above -required limits, an umbrella excess liability policy
may be used);
(iii) Worker's compensation insurance, with statutory coverage and employer's liability
protection; and
(iv) Such other insurance as the Authority may reasonably require.
The policies of insurance required pursuant to clauses (i) and (ii) above shall be in form and
content satisfactory to the Authority and shall be placed with financially sound and reputable
insurers licensed to transact business in the State, the liability insurer to be rated A or better in
Best's Insurance Guide. The policies of insurance delivered pursuant to clause (i) and (ii) above
shall contain an agreement of the insurer to give not less than thirty (30) days' advance written
notice to the Authority in the event of cancellation of such policy or change affecting the
coverage thereunder. The Authority shall be named as an additional insured on the liability
policy obtained pursuant to clause (ii) above.
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ARTICLE VI
Prohibited Uses of Minimum Improvements
Section 6.1. Prohibited Uses. The Redeveloper agrees that the Redevelopment Property
and Minimum Improvements, or any portion thereof, shall not be used for the any of the
following uses: adult establishment, adult motion picture theater, adult novelty business or
bookstore, amusement devise establishment, auto sales and\or lease, cabinet, electrical, heating,
plumbing, air conditioning sales or service shop, open sales lot, pawn shop, drive-thru restaurant,
auto repair, warehouse or taxi terminal. This restriction shall run with the title to and
permanently encumber the Redevelopment Property for the benefit of the City and shall be
enforceable by means of an injunction. If the above terms are defined in the City's zoning
ordinances, the terms shall have the meaning contained therein.
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ARTICLE VII
Financing
Section 7.1. Financing. Prior to the Authority's conveyance of the Redevelopment
Property to the Redeveloper and in any event no later than six (6) months after the date of this
Agreement, the Redeveloper shall submit to the Authority evidence, satisfactory to the
Authority, that the Redeveloper has obtained financing or has available and committed funds in
an amount sufficient to pay the cost of acquiring the Redevelopment Property and constructing
the Minimum Improvements.
Section 7.2. Limitation Upon Encumbrance of Property. Prior to the completion of the
Minimum Improvements, as certified by the Authority, neither the Redeveloper nor any
successor in interest to the Redevelopment Property, or any part thereof, shall engage in any
financing or any other transaction creating any mortgage or other encumbrance or lien upon the
Redevelopment Property, whether by express agreement or operation of law, or suffer any
encumbrance or lien to be made on or attach to the Redevelopment Property, except for the
purposes of obtaining funds only to the extent necessary for acquiring and constructing the
Minimum Improvements without the prior written approval of the Authority.
Section 7.3. Subordination. In order to facilitate the Redeveloper's efforts to obtain
financing for acquisition of the Redevelopment Property and construction of the Minimum
Improvements the Authority will agree to reasonable requests from Redeveloper's lenders to
subordinate to the lien of the lenders' mortgages the Authority's rights to revert title to the
Redevelopment Property in the Authority pursuant to Section 9.3 of this Agreement and the
Deed.
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ARTICLE VIII
Prohibitions Against Assignment and Transfer, Indemnification
Section 8.1. Prohibition Against Transfer of Property and Assignment of Agreement. The
Redeveloper represents and agrees that prior to substantial completion of construction of the
Minimum Improvements, except only by way of security for, and only for, the purpose of
obtaining financing necessary to enable the Redeveloper or any successor in interest to the
Redevelopment Property, or any part thereof, to perform its obligations with respect to
constructing the Minimum Improvements under this Agreement, or to complete tax deferred
exchange under Section 1031 of the Internal Revenue Code, and any other purpose authorized by
this Agreement, the Redeveloper (except as so authorized) has not made or created, and will not
make or create, or suffer to be made or created, any total or partial sale, assignment, conveyance,
or lease (other than leases to residential tenants or commercial/retail tenants), or any trust or
power, or transfer in any other mode or form of or with respect to this Agreement or the
Redevelopment Property or any part thereof or any interest herein or therein, or any contract or
agreement to do any of the same, without the prior written approval of the Authority which shall
not be unreasonably withheld or conditioned.
In the absence of specific written agreement by the Authority to the contrary, no such
transfer or approval thereof by the Authority shall be deemed to relieve the Redeveloper, or any
other party bound in any way by this Agreement from any of its obligations hereunder.
Section 8.2. Release and Indemnification Covenants. (a) The Redeveloper releases from
and covenants and agrees that the Authority 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 governing body members, officers, agents, servants and employees thereof
against any loss or damage to property or any injury to or death of any person occurring at or
about or resulting from any defect in the Minimum Improvements.
(b) Except for any willful misrepresentation or any misconduct of the following named
parties, the Redeveloper agrees to protect and defend the Authority and City and the governing
body members, officers, agents, servants and employees thereof, now or forever, and further
agrees to hold the aforesaid 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 Redevelopment Property and Minimum Improvements.
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ARTICLE IX
Events of Default
Section 9.1. Events of Default Defined. The term "Event of Default" shall mean, whenever
it is used in this Agreement (unless the context otherwise provides); (i) any failure by a party to
observe or perform any covenant, condition, obligation or agreement on its part to be observed or
performed hereunder or (ii) a material breach of any representation set forth herein on or prior to
the closing on conveyance of the Redevelopment Property.
Section 9.2. Remedies on Default. Whenever any Event of Default occurs, the non -
defaulting party may immediately suspend its performance under this Agreement and may take
any one or more of the following actions after providing thirty (30) 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 (30) days or, if the Event of Default is by its nature incurable within said thirty
(30) days, the defaulting party has not provided reasonable assurances to the non -defaulting party
that the Event of Default will be cured and that it will be cured as soon as reasonably possible:
(a) Terminate this Agreement.
(b) 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. Revestiniz of Title in Authority. If the Redeveloper fails to commence or
complete construction of the Minimum Improvements within the periods specified in Section 4.3
of this Agreement the Authority shall have the right to cancel the sale of the Redevelopment
Property to the Redeveloper, whereupon title to the Redevelopment Property shall revert to the
Authority. Upon revesting title to the Redevelopment Property in the Authority, the Authority
will use its best efforts to resell the Redevelopment Property, or parcel thereof, for
redevelopment and shall use the proceeds of such a resale to first, reimburse itself for all of its
costs incurred in enforcing its rights under this Agreement, in clearing title to the Redevelopment
Property, and in reselling the Redevelopment Property, and second, to reimburse the
Redeveloper for the purchase price paid by the Redeveloper to acquire the Redevelopment
Property and for any costs incurred by the Redeveloper in constructing the Minimum
Improvements. The deed from the Authority to the Redeveloper shall convey title to the
Redevelopment Property subject to a right of reversion reserved to the Authority as described in
this Section. The terms of this Section 9.3 are subject to the terms of Section 7.3 hereof.
Section 9.4. 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
19
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 or the Redeveloper 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 9.5. 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 9.6. Effect of Termination of Agreement. In the event that this Agreement is
terminated pursuant to Section 9.2, all provisions hereof shall terminate except that Sections 3.9,
9.7, and 8.2 shall survive such termination and any cause of action arising hereunder prior to
such termination shall not be affected.
Section 9.7. Costs of Enforcement. Whenever any Event of Default occurs and the non -
defaulting party 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 other party under this Agreement, the defaulting party agrees that it
shall, within ten (10) days of written demand by the non -defaulting party pay to the non -
defaulting party the reasonable fees of such attorneys and such other expenses so incurred by the
non -defaulting party.
20
ARTICLE X
Additional Provisions
Section 10.1. Representatives Not Individually Liable. No member, official, or employee
of the Authority shall be personally liable to the Redeveloper, or any successor in interest, in the
event of any default or breach or on any obligations under the terms of the Agreement.
Section 10.2. Restrictions on Use. The Redeveloper agrees for itself, and its successors
and assigns, and every successor in interest to the Redevelopment Property, or any part thereof,
that the Redeveloper, and such successors and assigns, shall comply with the restrictions on use
contained in Section 6.1 of this Agreement. The deed transferring the Redevelopment Property
to the Redeveloper shall contain a covenant so restricting the use of the Property.
Section 10.3. 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
Redevelopment Property and any such deed shall not be deemed to affect or impair the
provisions and covenants of this Agreement.
Section 10.4. 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 10.5. Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand, .or other communication under the Agreement by either party to
the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail,
postage prepaid, return receipt requested, or delivered personally; and
(a) in the case of the Redeveloper, is addressed to or delivered personally to the
Redeveloper at 24 Shady Oak Road, Hopkins, Minnesota 55343; and
(b) in the case of the Authority, is addressed to or delivered personally to the Authority
at 1010 First Street South, Hopkins, Minnesota 55343,
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. Mailed notice shall be
deemed to have been delivered two (2) business days after being deposited with the U.S. Postal
Service.
Section 10.6. Disclaimer of Relationships. The Redeveloper acknowledges that nothing
contained in this Agreement nor any act by the Authority or the Redeveloper shall be deemed or
construed by the Redeveloper or by any third person to create any relationship of third -party
beneficiary, principal and agent, limited or general partner, or joint venture between the
Authority and the Redeveloper and/or any third party.
21
Section 10.7. Modifications. This Agreement may be modified solely through written
amendments hereto executed by the Redeveloper and the Authority.
Section 10.8. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall constitute one and the same instrument.
Section 10.9. Judicial Interpretation. Should any provision of this Agreement require
judicial interpretation, the court interpreting or construing the same shall not apply a presumption
that the terms hereof shall be more strictly construed against one party by reason of the rule of
construction that a document is to be construed more strictly against the party who itself or
through its agent or attorney prepared the same, it being agreed that the agents and attorneys of
both parties have participated in the preparation hereof.
• Section 10.10. No Business Subsidy. The Authority has determined that its conveyance of
the Redevelopment Property to the Redeveloper is being done as partial consideration for the
Redeveloper's sale of the Acquired Property to the Authority and that, therefore, it does not
constitute a "business subsidy" under the Minnesota Business Subsidy Act, Minnesota Statutes,
Sections 116J.993 to 116J.995
Section 10.11. Effect of Termination of Agreement. In the event that this Agreement is
terminated in accordance with the terms hereof, such termination shall have no effect on the
Purchase Agreement or on the rights of the Authority to acquire the Acquired Property in
accordance with the terms of the Purchase Agreement.
22
IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed
in its name and behalf 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.
STATE OF MINNESOTA)
)SS.
COUNTY OF HENNEPIN)
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF HOPKINS, MINNESOTA
By:
Its: Executive Director
By:
Its: Chair
MOKABAKA LLC
By
By
The foregoing instrument was acknowledged before me this _ day of , 2013, by
and , the Executive Director and Chair of the Housing and
Redevelopment Authority In and For the City of Hopkins, a public body politic and corporate
under the laws of the state of Minnesota.
STATE OF MINNESOTA)
)SS.
COUNTY OF HENNEPIN)
Notary Public
The foregoing instrument was acknowledged before me this _ day of , 2013, by
and the
and
the company.
of Mokabaka LLC, a Minnesota limited liability company, on behalf of
23
Notary Public
SCHEDULE A
Description of Redevelopment Property
Redevelopment Property:
Lots 9, 10 and 11, Block 1, Oak Ridge 2nd Addition, Hennepin County, Minnesota, except for
right-of-way to be conveyed to the County for the County Project
SCHEDULE B
QUIT CLAIM DEED
THIS INDENTURE, between the Housing and Redevelopment Authority In and For the
City of Hopkins, Minnesota, a public body corporate and politic created pursuant to the Laws of
Minnesota (the "Grantor"), and Mokabaka LLC, a Minnesota limited liability company (the
"Grantee").
WITNESSETH, that Grantor, in consideration of the sum of
Dollars ($ ) and other good and valuable consideration the receipt whereof is hereby
acknowledged, does hereby grant, bargain, quitclaim and convey to the Grantee, its successors
and assigns forever, all the tract or parcel of land lying and being in the County of Hennepin and
State of Minnesota described as follows, to -wit (such tract or parcel of land is hereinafter
referred to as the "Property"):
To have and to hold the same, together with all the hereditaments and appurtenances
thereunto belonging in any wise appertaining, to the said Grantee, its successors and assigns,
forever,
Provided:
SFCTTON 1 _
It is understood and agreed that this Deed is subject to the covenants, conditions,
restrictions and provisions of an agreement entered into between the Grantor and Grantee, as of
the _ day of , 2013, identified as "Purchase and Development
Agreement " (hereafter referred to as the "Agreement") which Agreement is incorporated herein
and made a part hereof by reference.
This provision, however, shall in no way prevent the Grantee from mortgaging this
Property in order to obtain funds for the purchase of Property hereby conveyed and for erecting
improvements thereon in conformity with the Agreement, any applicable redevelopment plan
and applicable provisions of the Zoning Ordinance of the City of Hopkins, Minnesota.
It is specifically agreed that the Grantee shall promptly begin and diligently prosecute to
completion the redevelopment of the Property through the construction of the improvements
thereon, as provided in the Agreement.
Promptly after completion of the improvements in accordance with the provisions of the
Agreement, the Grantor will furnish the Grantee with an appropriate instrument so certifying (the
"Certificate of Completion"). The Certificate of Completion by the Grantor shall be (and it shall
be so provided in the certification itself) a conclusive determination of satisfaction and
termination of the agreements and covenants of the Agreement and of this Deed with respect to
the obligation of the Grantee, and its successors and assigns, to construct the improvements and
the dates for the beginning and completion thereof. The Certificate of Completion and such
determination shall not constitute evidence of compliance with or satisfaction of any obligation
of the Grantee to any holder of a mortgage, or any insurer of a mortgage, securing money loaned
to finance the purchase of the Property hereby conveyed or the improvements, or any part
thereof.
The Certificate of Completion and any other certifications provided for herein shall be in
such form as will enable them to be recorded with the County Recorder, or Registrar of Titles,
Carver County, Minnesota. If the Grantor shall refuse or fail to provide any such certification in
accordance with the provisions of the Agreement and this Deed, the Grantor shall, within thirty
(30) days after written request by the Grantee, provide the Grantee with a written statement
indicating in adequate detail in what respects the Grantee has failed to complete the
improvements in accordance with the provisions of the Agreement or is otherwise in default, and
what measures or acts it will be necessary, in the opinion of the Grantor, for the Grantee to take
or perform in order to obtain such certification.
SECTION 2.
In the event the Grantee herein shall, prior to the completion of construction of the
improvements under the Agreement as evidenced by the recording of the Certificate of
Completion for such unit, hereinabove referred to:
(a) Fail to begin construction of the improvements provided for in this Deed
and the Agreement in conformity with the Agreement and such failure is not due to
unavoidable delays (as defined in the Agreement) and such failure is not cured within
thirty (30) days after written notice to do so; or
(b) Default in or violate its obligations with respect to the construction of the
improvements provided for in this Deed and the Agreement, or shall abandon or
substantially suspend construction work, and such default, violation or failure is not due
to unavoidable delays (as defined in the Agreement), and any such default or violation,
abandonment or suspension shall not be cured, ended or remedied within thirty (30) days
after written demand by the Grantor so to do; or
(c) Fail to pay real estate taxes or assessments on the Property or any part
thereof when due, or shall place thereon any encumbrance or lien unauthorized by the
Agreement with the Grantor, or shall suffer any levy or attachment to be made, or any
materialmen's or mechanic's liens, or any other unauthorized encumbrances or liens to
attach, and such taxes or assessments shall not have been paid or the encumbrance or lien
removed or discharged, or provisions satisfactory to the Grantor made for such payments,
removal or discharge, within thirty (30) days after written demand by the Grantor so to do
provided, that if the Redeveloper shall first notify the Grantor of its intention to do so, it
may in good faith contest any mechanics' or other lien filed or established and in such
event the Grantor shall permit such mechanics' or other lien to remain undischarged and
unsatisfied during the period of such contest and any appeal, but only if the Grantee
provides the Grantor with evidence acceptable to the Grantor that the Grantee's title
insurance company will insure over the lien or provides a bank letter of credit in the
amount of the lien, in a form satisfactory to the Grantor pursuant to which the bank will
pay to the Grantor the amount of any lien in the event that the lien is finally determined to
be valid and during the course of such contest the Grantee shall keep the Grantor
informed respecting the status of such defense; or
(d) Cause in violation of the Agreement or of this Deed, any transfer of the
Property or any part thereof that is not approved by the Grantor in accordance with the
terms of the Agreement, and such violation shall not be cured within sixty (60) days after
written demand by the Grantor to the Grantee; or
(e) Fail to comply with any of its covenants under the Agreement and fail to
cure any such noncompliance within thirty (30) days after written demand to do so; or
(f) Default under the terms of a mortgage loan authorized by Article VII of
the Agreement and the holder of the mortgage exercises any remedy provided by the
mortgage documents or exercises any remedy provided by law or equity in the event of a
default in any of the terms or conditions of the mortgage and such default is not cured by
the later of the applicable notice and cure period of such mortgage or sixty (60) days after
written demand by the Grantor;
then the Grantor shall have the right to re-enter and retake title to and possession of the Property
and to terminate and revest in the Grantor the estate conveyed by this Deed to the Grantee, its
assigns or successors in interest, subject to the terms and conditions of the Agreement, but only if
the events stated in Section 2(a) -(f) have not been cured within the time periods provided above,
or if the events cannot be cured within such time periods, the Redeveloper does not provide
assurances to the Authority, reasonably satisfactory to the Authority, that the events will be cured
and will be cured as soon as reasonably possible.
CFCTTCIN I
The Grantee agrees for itself and its successors and assigns to or of the Property or any
part thereof, hereinbefore described, that the Grantee and such successors and assigns shall at all
times:
(a) Devote the Property to, and only to and in accordance with the uses
specified in any applicable redevelopment plan adopted by the Authority as amended and
extended, provided that no amendment shall prohibit a pre-existing permitted use;
(b) Comply with all of the terms and conditions of the Agreement.
(c) Not use the Property for any of the following uses: adult establishment,
adult motion picture theater, adult novelty business or bookstore, amusement devise
establishment, auto sales and\or lease, cabinet, electrical, heating, plumbing, air
conditioning sales or service shop, open sales lot, pawn shop, drive-thru restaurant, auto
repair, warehouse or taxi terminal.
It is intended and agreed that the above and foregoing agreements and covenants shall be
covenants running with the land, and that they shall, in any event, and without regard to technical
classification or designation, legal or otherwise, and except only as otherwise specifically
provided in this Deed and the Agreement, be binding, to the fullest extent permitted by law and
equity for the benefit and in favor of, and enforceable by, the Grantor, its successors and assigns,
and any successor in interest to the Property, or any part thereof against the Grantee, its
successors and assigns, and every successor in interest to the Property, or any part thereof or any
interest therein, and any party in possession or occupancy of the Property or any part thereof.
In amplification, and not in restriction of, the provisions of the preceding section, it is
intended and agreed that the Grantor and its successors and assigns shall be deemed beneficiaries
of the agreements and covenants provided herein. Such agreements and covenants shall run in
favor of the Grantor without regard to whether the Grantor has at any time been, remains, or is an
owner of any land or interest therein to, or in favor of, which such agreements and covenants
relate. The Grantor shall have the right, in the event of any breach of any such agreement or
covenant to exercise all the rights and remedies, and to maintain any actions or suits at law or in
equity or other proper proceedings to enforce the curing of such breach of agreement or
covenant, to which it or any other beneficiaries of such agreement or covenant may be entitled.
The covenants and agreements of this Deed and the Agreement shall be enforceable only by
Grantor, the City of Hopkins, Minnesota, and any public body which is a successor of Grantor.
SECTION 4.
This Deed is also given subject to:
(a) Provision of the ordinances, building and zoning laws of the City of Hopkins,
state and federal laws and regulations in so far as they affect this real estate.
(b) Taxes payable subsequent to the date of this conveyance.
SECTION 5.
The Grantor certifies that the Grantor does not know of any wells on the subject property.
IN WITNESS WHEREOF, the Grantor has caused this Deed to be duly executed in its
behalf by its Executive Director this day of , 2013.
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF HOPKINS, MINNESOTA
By:
Its: Executive Director
By:
Its: Chair
STATE OF MINNESOTA)
)ss.
COUNTY OF HENNEPIN)
The foregoing instrument was acknowledge before me this day of
, 2013, by and , the Executive
Director and Chair of the Housing and Redevelopment Authority In and For the City of Hopkins,
Minnesota, a public body politic and corporate, on behalf of the Authority.
Notary Public
This instrument was drafted by:
BRADLEY & DEIKE, P.A.
4018 West 65h Street, Suite 100
Edina, Minnesota 55435.
SCHEDULE C
Purchase Agreement
SCHEDULED
Syndicate Lease
Hennepin County Contract No. A 120493
COOPERATIVE AGREEMENT FOR
SHADY OAK ROAD COMMUNITY WORKS PROJECT
This Agreement is between the County of Hennepin Housing and Redevelopment
Authority ("HCHRA"), A-2300 Government Center, Minneapolis, Minnesota 55487, and the
Housing and Redevelopment Authority in and for the City of Hopkins ("HHRA"), 1010 151 St S,
Hopkins, Minnesota 55343 and the Economic Development Authority in and for the City of
Minnetonka ("MEDA"), 14600 Minnetonka Boulevard, Minnetonka, Minnesota 55345.
WHEREAS, all parties wish to complete a redevelopment project and associated public
and private improvements as part of the Shady Oak Road Community Works Project ("Project");
and
WHEREAS, the project area is the area between Oak Drive on the North and Bradford
Road on the South; Shady Oak Road on the East and the west property boundary of properties
west of Shady Oak Road (`Project Area"); and
WHEREAS, the Project is consistent with the recommendations of the Redevelopment
Project Area One in the City of Hopkins and the redevelopment'project area to be approved by
the City of Minnetonka in 2012; and
WHEREAS, as part of its Redevelopment Project No. 1, the HHRH has approved a
redevelopment plan for the Project Area ("Plan"); and
WHEREAS, the MEDA will approve a redevelopment plan for parcels within the Project
Area that are located within its boundaries ("Plan") by December 31, 2012; and
WHEREAS, by Resolution No. 07- 466R1, Hennepin County authorized funds in an
amount not to exceed Three Million Dollars for the Shady Oak Road Community Works Project;
WHEREAS, the HCHRA wishes to contract with the HHRA and MEDA for completion
of said Project; and
WHEREAS, the HCHRA has the authority to contribute to the Project pursuant to
Minnesota Statutes, Chapter 163 and Sections 383B.77, 383B.79, 469.001 to 469.047, 471.85,
and other applicable law; and
WHEREAS, the parties are authorized to enter into this agreement pursuant to Minnesota
Statutes Sections 383B.79, 471.59 and other applicable law;
THEREFORE, the parties agree as follows:
1. Term and Cost of the Agreement. The term of this agreement commences December 1,
2012 and terminates December 31, 2017. HCHRA agrees to reimburse HHRA and
MEDA for an amount up to Three Million Dollars ($3,000,000) ("Funds") for the
property acquisition, property improvements, environmental abatement, and other
activities and services specified in Section 4 below and generally illustrated on
Attachment A ("Improvements") or as approved by HCHRA . Additional funds from
payments for roadway right-of-way, not to exceed $1,370,000 ("Additional Funds") may
also be available during the project period for property acquisitions.
2. Responsibilities of Parties. The HHRA intends to purchase property for the purpose of
redeveloping it with a new building with a minimum size of 10,000 square feet (the
"Redevelopment Site") or an 8,000 square foot building if the building is constructed by
a property owner currently in the project area and to make the Improvements to the
Redevelopment Site. The HHRA also intends to make Improvements to other parcels
within the Project Area, as provided in this Agreement. HHRA and the HCHRA shall
determine the actual location, area and dimensions of the Redevelopment Site. The
HCHRA shall not unreasonably withhold or delay its approval of any request by the
HHRA for approval of the location of parcels to be acquired for the Redevelopment Site,
and shall notify the HHRA of approval or disapproval of such location within ten (10)
business days of submission of a request for approval by the HHRA. The MEDA will
approve a redevelopment area for parcels within the Project Area that are located within
its boundaries by December 31, 2012. The MEDA agrees to make the Improvements to
parcels within the Project Area that are located within its boundaries, as provided in this
Agreement. HCHRA agrees to reimburse HHRA and MEDA for the Improvements in
accordance with Section 4 of this Agreement.
3. Restricted Use of the Funds. The use of any Funds for acquisition of the Redevelopment
Site or Improvements thereto is contingent upon the ability of the HHRA to acquire
property from willing sellers for the creation of the Redevelopment Site. If the HHRA is
unable to acquire the Redevelopment Site, no portion of the HCHRA Funds are
expendable solely for the purpose of making improvements to private property or for the
creation of new parking, provided the HHRA shall be entitled to reimbursement for
Second and Third priority expenditures for which the HHRA has become unconditionally
obligated in reliance on this Agreement.
4. Improvements Reimbursed. HHRA and MEDA shall use all Funds received under this
Agreement for the purposes, and in the priority, described below. If additional funds are
deemed necessary to meet the objectives of the HHRH, MEDA and HCHRA, the parties
agree to work together to identify additional funds available for the project. Any
expenditure for the particular priority that exceeds the not -to -exceed amount will be
reviewed by the HHRA and the MEDA, with the HCHRA providing fmal approval.
In order to work within time constraints and to prevent duplicative payments to property
owners from both the Project and the current road project (County Project 9112), any
property within the Project Area that is in an eminent domain action by Hennepin County
2
as a part of County Project 9112, will be ineligible to receive Funds for improvements to
privately owned property unless HCHRA approves payment of the Funds after reviewing
the circumstances of the condemnation.
A. First Priority for the Expenditure of Funds: Acquire property within Project Area
for the purpose of creating the Redevelopment Site. Property acquisition and
redevelopment costs eligible for reimbursement from the HCHRA include:
• Purchase of property for redevelopment purposes to be included in
the Redevelopment Site
• Relocation of tenants in acquired properties
• Acquisition and/or relocation consultant services
• Hazardous material abatement in acquired buildings and land
including, but not limited to, costs of environmental assessments,
testing, MPCA fees and environmental remediation costs
• Demolition of buildings on acquired property
• Legal Services related to acquisition activities
• Engineering services to facilitate building removal
• Restoration of building walls related to building separation
• Permitting fees
• Other services as preapproved by Hennepin County
The expenditures for property acquisition are not to exceed $3,000,000 without
review by HHRA and MEDA and approval by HCHRA. In connection with the
transfer of the Redevelopment Site to a redeveloper, the HHRA may enter into a
subrecipient agreement or redevelopment agreement with the redeveloper
allowing use of the Funds for the purposes described in this Paragraph A, subject
to all of the terms and conditions state in this Agreement. The HCHRA will
reimburse HHRA for costs listed above.
Prior to expending funds for any of the following priorities, purchase
agreement(s) must be signed for the purchase of property that will create an
adequately sized development parcel as determined by the HHRA and the
HCHRA.
B. Second Priority for the Expenditure of Funds: Construct new parking lots as
determined necessary to support adjoining businesses similar to the manner
depicted in the schematic development concept found in Attachment A. Eligible
reimbursable expenses include:
• Removals, grading and other site preparation
• Installing Parking Lot Base
• Asphalt Paving, Seal Coating, and Striping of New Parking Areas
• Lighting of Parking Areas
• Landscaping
New parking lots shall be subject to the following terms and conditions unless
otherwise allowed by the HCHRA:
i) Title to the land on which new parking lot(s) are constructed or will be
constructed in the future may be sold to adjacent property owner(s) for an
amount equal to the fair market value as established by the Hennepin County
Assessor, which will take into account the non-exclusive parking easement(s),
or such value as is otherwise allowed by the HCHRA.
ii) As a condition of the sale of new parking lot property to an adjacent property
owner, the parking lot may be subject to a non-exclusive parking easement that
provides for the sharing of the parking with adjacent commercial properties.,
The expenditures for new parking lots are not to exceed $300,000 without review
by HHRA and MEDA and approval of HCHRA.
C. Third Priority for the Expenditure of Funds: Improvements to existing private
parking lots within the project area as designated "ICN" in Attachment A.
Eligible reimbursable expenses include:
• Asphalt Overlay, Seal Coating, and Striping
• Lighting within the parking lot using the chosen light standard for
the project area.
Private property owners may be eligible to receive cost to cure payments for
parking lot improvements (seal coating, stripping, etc.) from Hennepin County
Transportation for the Shady Oak Road project. Whether in the city of Hopkins
or Minnetonka, the parking lot improvements will be managed and monitored by
Minnetonka city staff. All parking lots improvements and payments will be
coordinated with Hennepin County staff and the roadway construction
contractor(s) for County Project 9112.
The expenditures for parking lot improvements are not to exceed $300,000
without review by HHRA and MEDA and approval by HCHRA.
D. Fourth Priority for the Expenditure of Funds: Fagade improvements to existing
businesses that conform to the current city zoning code and are immediately
adjacent to the Shady Oak Road construction project between Highway 7 and
Excelsior Boulevard. Property owners are required to provide a 50 percent cash
match to any funds provided by HCHRA for fagade improvements. HHRA and
MEDA will manage the fagade improvements for properties in their cities.
Fagade improvements are only possible if funding remains after completion of the
first three priority activities.
4
E. Fifth Priority for Expenditure of Funds: Other public amenities that support
Community Works principles within the Shady Oak Road corridor (for example,
streetscape and park improvements).
5. Disposal of Acquired Property. The HHRA shall use its best efforts to sell or otherwise
transfer the Redevelopment Site to a qualified and responsible redevelopment party or
parties (as determined by the HHRA) who will assume the obligation of completing the
Minimum Improvements by December 31, 2017. The terms and conditions for the sale
or transfer of the Redevelopment Site to a redeveloper shall be determined by the HHRA
in its reasonable discretion and such transfer may be made for less than fair market value
in order to facilitate redevelopment of the Redevelopment Site. The Minimum
Improvements are abuilding of new construction with a minimum size of 10,000 square
feet or 8,000 square feet if the building is constructed by a project area property owner
and an associated landscaped, lighted parking lot(s), as generally illustrated in
Attachment A, attached and incorporated by this reference.
Any land sale proceeds must be used only for the purposes stated in Section 4 of this
agreement. It is understood that relocation to or acquisition of the Redevelopment Site
may be offered to one or more of the project area owners in exchange for the property
presently occupied by such owner(s). If this occurs, and the HHRA acquires such
property in exchange, the HHRA agrees to convey to Hennepin County that part of the
property acquired in such exchange that is needed for roadway and/or right-of-way
purposes as described in item 8.
6. Development Agreement. Any development agreement that is negotiated by the HHRA
with a developer of the Redevelopment Site purchased with HCHRA funds must receive
HCHRA approval. Approval will not be withheld if the project meets the Minimum
Improvements requirements.
7. Parking Lot Improvements. Construction of parking lot improvements within the project
area, whether in the city of Hopkins or Minnetonka, will be managed and monitored by
Minnetonka city staff, subject to reasonable approval of Hopkins city staff as to location
and design for properties located in Hopkins. All parking lots improvements will be
coordinated with Hennepin County staff and the roadway construction contractor(s).
Conveyance of Roadway/Right-of-Way Property. The HHRA and MEDA agree to
convey to Hennepin County for no cost any real property acquired which is identified by
Hennepin County as required for roadway construction and/or right-of-way purposes as
part of County Project 9112 provided such real property has been acquired with the use
of Funds or Additional Funds provided by HCHRA. Conveyance to Hennepin County
shall be completed before the sale or transfer of any property acquired under this
agreement or before the road project construction commences, whichever is earlier.
9. Payment. Payment for property acquisition costs and the Improvements shall be made
directly to the HHRA and MEDA after completion of the acquisition or incurring costs
for other Improvements and upon the presentation of a claim in the manner provided by
5
law governing the HCHRA's payment of claims. Payment shall be made within forty-
five (45) days from receipt of the invoice.
10. Independent Contractor. The HHRA and MEDA shall select the means, method, and
manner of performing the services. Nothing is intended or should be construed as
creating or establishing the relationship of a partnership or a joint venture between the
parties or as constituting the HHRA and MEDA as the agent, representative, or employee
of the HCHRA for any purpose. The HHRA and MEDA are and shall remain
independent contractors for all services performed under this Agreement. The HHRA
and MEDA shall secure all personnel required in performing services under this
Agreement. Any personnel of the HHRA and MEDA or other persons while engaged in
the performance of any work or services required by the HHRA and MEDA will have no
contractual relationship with the HCHRA and will not be considered employees of the
HCHRA. The HCHRA shall not be responsible for any claims that arise out of
employment or alleged employment under the Minnesota Economic Security Law or the
Workers' Compensation Act of the State of Minnesota on behalf of any personnel,
including, without limitation, claims of discrimination against the HHRA and MEDA, its
officers, agents, contractors, or employees. The HHRA and MEDA shall defend,
indemnify, and hold harmless Hennepin County and the HCHRA, their officials, officers,
agents, volunteers, and employees from all such claims irrespective of any determination
of any pertinent tribunal, agency, board, commission, or court. Such personnel or other
persons shall neither require nor be entitled to any compensation, rights, or benefits of
any kind from the HCHRA, including, without limitation, tenure rights, medical and
hospital care, sick and vacation leave, Workers' Compensation, Re-employment
Compensation, disability, severance pay, and retirement benefits.
11. Indemnification. The HHRA and MEDA agree to defend, indemnify, and hold harmless
Hennepin County and the HCHRA, their officials, officers, agents, volunteers and
employees from any liability, claims, causes of action, judgments, damages, losses, costs,
or expenses, including reasonable attorney's fees, resulting directly or indirectly from any
act or omission of the HHRA and MEDA, a subcontractor, anyone directly or indirectly
employed by them, and/or anyone for whose acts and/or omissions they may be liable in
the performance of the services required by this Agreement, and against all loss by reason
of the failure of the HHRA and MEDA to perform any obligation under this Agreement.
Nothing in this Agreement constitutes a waiver by the parties of any statutory or common
law defenses, immunities, or limits on liability. The obligation of a party under this
section cannot exceed the amount that the parry would be obligated to pay under the
provisions and limitations of Minn. Stat. Chap. 466 without this indemnification
language. Under no circumstances will a party be required to pay on behalf of itself and
other parties, any amounts in excess of the limits on liability established in Minnesota
Statutes Chapter 466 applicable to any one party.
12. Data Practices. The HHRA and MEDA, its officers, agents, owners, partners, employees,
volunteers and subcontractors shall abide by the provisions of the Minnesota Government
Data Practices Act, Minnesota Statutes, Chapter 13 (MGDPA), the Health Insurance
Portability and Accountability Act (HIPAA) and implementing regulations, if applicable,
and all other applicable state and federal laws, rules, regulations and orders relating to
data privacy or confidentiality. If the HHRA or MEDA creates, collects, receives, stores,
uses, maintains or disseminates data because it performs functions of the HCHRA
pursuant to this Agreement, then the HHRA and MEDA must comply Mth the
requirements of the MGDPA as if it were a government entity, and may be held liable
under the MGDPA for noncompliance. The HHRA and MEDA agree to defend,
indemnify and hold harmless Hennepin County and the HCHRA, its officials, officers,
agents, employees, and volunteers from any claims resulting from the HHRA and
MEDA's officers', agents', owners', partners', employees', volunteers', assignees' or
subcontractors' unlawful disclosure and/or use of such protected data, or other
noncompliance with the requirements of this section. The HHRA and MEDA agree to
promptly notify the HCHRA if it becomes aware of any potential claims, or facts giving
rise to such claims, under the MGDPA. The terms of this section shall survive the
cancellation or termination of this Agreement.
13. Records — Availabili /Access. Subject to the requirements of Minnesota Statutes
Section 16C.05, Subd. 5, the HHRA and MEDA agree that the HCHRA, the State
Auditor, or any of their authorized representatives, at any time during normal business
hours, and as often as they may reasonably deem necessary, shall have access to and the
right to examine, audit, excerpt, and transcribe any books, documents, papers, records,
etc., which are pertinent to the accounting practices and procedures of the HHRA and
MEDA and involve transactions relating to this Agreement. The HHRH and MEDA
shall maintain these materials and allow access during the period of this Agreement and
for six (6) years after its termination or cancellation.
14. Liabili . It is further understood that neither the HCHRA, nor its elected officials,
officers, agents and employees, either in their individual or official capacity, shall be
responsible or liable in any manner to the HHRA and MEDA for any claims, demands,
judgments, fines, penalties, expenses, actions or causes of actions of any kind or
character arising out of or by reason of negligent performance of the work by the HHRA
and MEDA, or arising out of the negligence of any contractor under the contract let by
the HHRA and MEDA for the performance of that work; and subject to the limitations in
Section 11, the HHRA and MEDA agree to defend, save and keep said HCHRA, its
elected officials, officers, agents and employees harmless from all claims, demands,
judgments, fines, penalties, expense, action or causes of actions and expenses (including,
without limitation, reasonable attorneys' fees, witness fees, and disbursements incurred in
the defense thereof) arising out of negligent performance by the HHRA and MEDA, its
officers, agents or employees.
15. Merger and Modification.
A. It is understood and agreed that the entire Agreement between the parties is
contained herein and that this Agreement supersedes all oral agreements and
negotiations between the parties relating to the subject matter. All items that are
referenced or that are attached are incorporated and made a part of this
7
Agreement. If there is any conflict between the terms of this Agreement and
referenced or attached items, the terms of this Agreement shall prevail.
B. Any alterations, variations, modifications, or waivers of provisions of this
Agreement shall only be valid when they have been reduced to writing as an
amendment to this Agreement signed by the parties.
16. Default and Cancellation.
A. 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 either of the
following events:
(i) Failure to comply with the terms of this Agreement.
(ii) Provided the HHRA is able to acquire the Redevelopment Site with the
use of Funds, the failure by the HHRA or a developer selected by the
HHRH to commence and complete construction of the Minimum
Improvements described as a new building of at least 10,000 square feet or
8,000 if new building is constructed by existing project area property
owner pursuant to the terms, conditions and limitations of this Agreement
by December 31, 2017.
B. If there is an Event of Default, at the discretion of the HCHRA, the following
remedies are possible upon written notice by the HCHRA:
(i) Suspend performance under this Agreement until the HCHRA receives
assurances of performance. No additional financial payments will be made
to the HHRA until the suspension has been released.
(ii) Renegotiate or terminate this Agreement, provided the HHRA and MEDA
shall have been given thirty (30) days notice and opportunity to cure the
Event of Default before such termination.
(iii) Require the transfer of any property purchased with HCHRA funds by the
HHRA or MEDA to the HCHRA whereupon the HCHRA shall have the
right to take possession of the property. Any property transferred to the
HCHRA shall have a clear title and be free of any special assessments and
unpaid utility bills, but subject to any encumbrances to which such property
is subject upon its acquisition by HHRA or MEDA.
(iv) Require the HHRA or MEDA to sell any property purchased with HCHRA
funds. The net proceeds (sale price minus closing costs) from the sale of
the property shall be paid to the HCHRA in an amount not to exceed the
Funds used to acquire such property and any other expenses incurred by
HCHRA for the purchase of the property.
The remedies specified in this Paragraph 16.B. shall be the sole and exclusive
remedies available to the HCHRA upon an event of default by the HHRH under
Subparagraph 16.A. (ii).
C. Notwithstanding any provision of this Agreement to the contrary, and as except as
provided in the last sentence of Paragraph B., above, the HHRA and MEDA shall
remain liable to the HCHRA for damages sustained by the HCHRA by virtue of
any breach of this Agreement by the HHRA and MEDA. Upon notice to the
HHRA and MEDA of the claimed breach and the amount of the claimed damage,
the HHRA and MEDA shall have a period of time not to exceed thirty (30) days
to cure the claimed breach and, if such breach is cured within the thirty (30) day
period, this Agreement shall remain in full force and effect in all of its terms and
conditions. If the claimed breach is not cured within the thirty (30) day period
specified in the preceding sentence, the HCHRA may withhold any payments to
the HHRA and MEDA for the purpose of set-off until such time as the exact
amount of damages due the HCHRA from the HHRA and MEDA is determined.
Following notice from the HCHRA of the claimed breach and damage, the HHRA
and MEDA and the HCHRA shall attempt to resolve the dispute in good faith.
D. Except as provided in the last sentence of Paragraph 16.B., above, the above
remedies shall be in addition to any other right or remedy available to the
HCHRA, the HHRA or the MEDA for a breach of this Agreement, including
remedies available to law, statute, rule, and/or equity.
E. The failure of any party to insist upon strict performance of any provision or to
exercise any right under this Agreement shall not be deertred a relinquishment or
waiver of the same, unless consented to in writing. Such consent shall not
constitute a general waiver or relinquishment throughout the entire term of the
Agreement.
F. Upon written notice, HCHRA may immediately suspend or cancel this Agreement
in the event any of the following occur: (i) the City of Hopkins and the City of
Minnetonka do not obtain anticipated funding for right-of-way acquisition costs
payable by such cities pursuant to the Agreement For Right -of -Way Acquisition
with the County of Hennepin; (ii) funding for this project is withdrawn, frozen,
shut -down, is otherwise made unavailable; or (iii) HCHRA determines, in its sole
discretion, that funding is, or has become, insufficient.
G. Notwithstanding anything to the contrary, if this Agreement is cancelled by
the HCHRA for any reason other than a material default by the HHRA and
MEDA after notice and a 90 day opportunity to cure, the HCHRA shall be
obligated to reimburse the HHRA and MEDA for all Project -related expenditures
(up to the $3,000,000 not to exceed amount in Section 1) made in reliance on this
Agreement.
0
17. Contract Administration. To coordinate the work or services of the HHRA
and MEDA with the activities of the HCHRA so as to accomplish the purposes of this
contract, Patrick Connoy, or his successor, shall manage this contract on behalf of the
HCHRA and serve as liaison between the HCHRA and the HHRA and MEDA. Kersten
Elverum, or her successor, shall be the contact person for the HHRH. Julie Wischnack,
or her successor, shall be the contact person for the MEDA.
18. Notices. Any notice or demand which must be given or made by a party under
the terms of this Agreement or any statute or ordinance shall be in writing, and shall be
sent registered or certified mail. Notices to the HCHRA shall be sent to the HCHRA
Administrator with a copy to the originating Department at the address given in the
opening paragraph of the Agreement. Notice to the MEDA shall be sent to the City
Administrator at the address stated in the opening paragraph of the Agreement. Notices to
the HHRA shall be sent to the Executive Director at the address stated in the opening
paragraph of this Agreement.
19. Survival of Provisions. Provisions that by their nature are intended to survive the term,
cancellation or termination of this Agreement include but are not limited to:
INDEPENDENT CONTRACTOR; INDEMNIFICATION; DATA PRACTICES;
RECORDS-AVAILABILITY/ACCESS; DEFAULT AND CANCELLATION; and
MINNESOTA LAW GOVERNS.
20. Minnesota Laws Govern. The Laws of the State of Minnesota shall govern all questions
and interpretations concerning the validity and construction of this Agreement and the
legal relations between the parties and their performance. The appropriate venue and
jurisdiction for any litigation will be those courts located within the County of Hennepin,
State of Minnesota. Litigation, however, in the federal courts involving the parties will
be in the appropriate federal court within the State of Minnesota. If any provision of this
Agreement is held invalid, illegal or unenforceable, the remaining provisions will not be
affected.
21. Reporting. The HHRA and MEDA must provide a written narrative on a bi-annual
basis to the HCHRA describing the Project activities that have been completed in
accordance with this Agreement.
THIS PORTION OF PAGE INTENTIONALLY LEFT BLANK
10
AUTHORITY BOARD AUTHORIZATION
HENNEPIN COUNTY HOUSING AND
REDEVELOPMENT AUTHORITY
STATE OF MINNESOTA
Reviewed the County
Atto is
a By: �`^-�---
/ hair of Its Board
Date: l / ls- l -L Date: / I -
APPROA TO X T ATTEST: LkA���
Deput Jerk of County Board
By: Date: / -2-
Assistant
Assistant County Attorney
/
Date: L l� - l By:
Executive Director
Date: I
HOUSING AND
REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF HOPKINS
By:
Chair
And:
E cuti irector
Date: 10—\6- l
By:
Deputy Ex cutive Director
Date:2--
ECONOMIC
DEVELOPMENT AUTHORITY IN AND FOR
THE CITY OF MINNEETONoKA
By: i 4 A�Y�,, �,,
President
And:
Executive DiMcto
Date:
11
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