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HRA 09/03/1998 - 6302HOUSING & REDEVELOPMENT AUTHORITY MEETING THURSDAY, SEPTEMBER 3, 1998 7:30 P.M. PUBLIC COPY (Please return to Community Development Department) e- CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING THURSDAY, SEPTEMBER 3,1998,'7:30 P.M. AGENDA LOCATION: FRIDLEY COMMUNITY CENEM 6085 7TH STREET * ***** ROOMS 112 & 114 ***** CALL TO ORDER ROLL CALL APPROVAL OF MINUTES June 26, 1998, Emergency Meeting August 6, 1998 CONSENT AGENDA Clarification Regarding Acquisition of 5859- 3' Street .......... 1 - 1A Consider Extension to Contract for Private Development with Jim Glidden for Vacant Lot at 5857 Main Street ............ 2 Consider Granting a Utility Easement for 1015 Mississippi Street .. 3 - 313 Consider Resolution Authorizing Execution of Development Contract with Cintas Corporation, Inc ........................ 4 - 4E Claims and Expenses .... ............................... 5 - 5C 1 01 u Resolution Authorizing Execution of a Contract for Private Development with Guy & Catherine Jordan for Vacant Lot at 540 Hugo Street .... ............................... 6-6C INFORMATION ITEMS Update on Soil Testing at 530 and 540 Hugo Street ............. 7 Monthly Housing Report ... ............................... 8-8C OTHER BUSINESS ADJOURNMENT ,Pkl CITY OF FRIDLEY EMERGENCY MEETING OF THE HOUSING & REDEVELOPMENT AUTHORITY JUNE 26, 1998 WMAMAX-OINPLAN Chairperson Commers called the June 26, 1998, Emergency Meeting of the Housing & Redevelopment Authority to order at 5:00 p.m. Members Present: Larry Commers, John Meyer, Pat Gabel Members Absent: Virginia Schnabel and Jim McFarland Others Present:: Barbara Dacy, Community Development Director Jim Casserly, Financial Consultant William Bums, Executive Director of the HRA Mayor Nancy Jorgenson Councilmember Ann Bolkcom Councilmember Steve Billings Peter Kitchak, Keewaydin Group Mr. Casserly explained that the necessity of this emergency meeting was discussed on Thursday, June 25, 1998. A public hearing notice was prepared and faxed, E- mailed, and telephoned to the Fridley Focus on June 25, 1998, so notice was provided as required. MOTION by Mr. Meyer, seconded by Ms. Gabel, to declare the HRA meeting an Emergency Meeting as per Minnesota Statutes 471.705. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Chairman Commers explained that the purpose of the meeting is to consider the status of a proposal that has been received from Medtronic regarding the Lake Pointe property that is currently under a development agreement with MEPC and being negotiated with Duke Realty, its successor. Ms. Dacy explained that the City Manager received a telephone call from Medtronic on Thursday, June 25 to schedule a meeting for Friday evening, June 26, 1998. Medtronic has informed the City that they have been in a strategic planning process and that they HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 26, 1998 PAGE 2 had hired the Keewaydin Group to assist them in the process. The growth of the company is expected to continue at a strong pace and they expect the need for more office space for their facilities. They would like to consider a dual campus approach with a new office campus in close proximity to their office at Central Avenue & Rice Creek. The Keewaydin Group has recommended three sites in the north metro area for this dual campus approach and their top choice would be the Fridley site (Lake Pointe). Medtronic is interested in acquiring the entire site of approximately 38-40 acres and they would be prepared to begin construction of a minimum 150,000 square foot building as early as this fall or no later than May of 1999. If construction was to commence by May of 1999, a completion date could be expected by the end of next year with occupancy the fourth quarter of 1999 or the first quarter of 2000. The building could be as large as 250,000 square feet and be a multi -story structure. Medtronic has requested both the land for the building and the site control for the entire site. They are prepared to negotiate terms of a development agreement that would address these requests. The City expects that they could enter into negotiations for a development contract for the first building and subsequent to that development rights for the remainder of the site. Medtronic would own the site and building as opposed to leasing from another user. They would expect the HRA to use the tax increment created from the construction to support the construction of the parking ramps to serve the completed buildings. They are also prepared in the next 6 months to initiate the master planning process for the site as soon as control is established. Ms. Dacy stated the proposed action is a resolution which would revoke the authorization for the Chairperson and the Executive Director to execute the development contract with Duke Realty. A resolution approving such action was approved by the HRA at its meeting on June 4, 1998. This resolution would also authorize the transmission of a letter from the Executive Director to the appropriate officials at Duke to withdraw the offer to sell the 10 -acres for the tech building. Mr. Peter Kitchak of Keewaydin Group, representing Medtronic was present to discuss this proposal with the HRA. He explained that Medtronic has selected this as their top site. The key to finding a successful site is to make sure that the opportunity is very carefully thought out as to being suitable for them on a long term basis. They view this site as a 10 -15 year solution to the rapid growth of the company. Their other Fridley facility is growing at a rate of 7 -8% per year. The Columbia Heights facility expects to see a growth in the 10 -20% range. This site could be an excellent site for a major office building now with the possibility of consolidating all of their research and development efforts and their educational trading efforts. Chairperson Commers asked if Medtronic is prepared at this time to sit down and negotiate a development agreement. e HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 26, 1998 PAGE 3 Mr. Kitchak responded in the affirmative. Medtronic has given them the authority to begin this process. Senior Management at Medtronic has indicated that they are prepared to make the necessary decisions very rapidly. Councilmember Billings stated he is very enthusiastic about the potential development. He asked if the Keewaydin Group is in a position to negotiate the stage of construction for the entire site. Mr. Kitchak responded in the negative. They are not prepared to provide schedules for construction, size, or the sequence. Their organization has recommended that Medtronic consider acquisition of the entire site or acquire a second site in close proximity to their existing site. Again, they are prepared to negotiate a development agreement; one which would protect the City. Councilmember Billings stated that the subject property was established as a Tax Increment District, and they have a limited amount of time to recover the funds. The HRA needs to be able to determine whether the increase in the value of land will generate enough Tax Increment Financing to make this development work without some type of building schedules. Mr. Kitchak explained that he is confident that they can work out an acceptable agreement with the City. They do not expect the City to expend funds without reimbursement. He understands that this is a development district with 10+ years left on it. Councilmember Billings stated his concern in them controlling the site is in the event that they have a change of plans later and decide they do not want to build an additional structure on the site. In an instance such as this, the City would have a much smaller "window of opportunity" to market the site. Mr. Commers agreed that there are some risks for the City. However, he feels overall that this would be a very good development for the site. Mr. Kitchak stated he feels safe in estimating that the increment derived from the construction of the first building will at least double, perhaps triple, the amount that would have been on the initial development proposal. Furthermore, the presence of the Medtronic facility would, in his opinion, only serve to make the site more appealing/ marketable and enhance the value of the land. Mayor Jorgenson asked if Medtronic was asking the City to hold the land, or is Medtronic asking for the entire piece? HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 26, 1998 PAGE 4 Mr. Kitchak responded that they understand that if Medtronic does not develop the land, the city has to have a right to it. Their desire is to have control of the land so that they can be sure that the development pattern is consistent with first class corporate centers. Councilmember Billings asked how soon the City could expect to have a negotiated development agreement prepared, assuming that it is a top priority issue. Could they . expect to have a development agreement negotiated by August 1, 1998? Mr. Kitchak explained that it is their full intention to move forward rapidly; however, he cannot guarantee that a development agreement would be fully negotiated by that date. This project will be a very high priority to them and they are committed to making it happen quickly. However, it is necessary to see that an agreement is reached carefully. Councilmember Billings asked what the status of the two other sites would be should the HRA choose to revoke the current agreement and begin negotiating with them. He stated he would not want to jeopardize what the City has now only to find that Medtronic is continuing negotiations on the other sites. Mr. Kitchak stated he feels it is safe to say that they will be focusing their efforts on this site. Councilmember Bolkcom stated her concern in that all negotiations appears to be through a consulting firm and not directly with Medtronic. Mr. Bums stated he has been working with Roger McCombs from Medtronic for many years and feels he has a high level of trust through his long -term working relationship with him. Mr. Bums further stated that he had met with him and the Keewaydin group Friday morning regarding this matter and he very much endorsed what is going on and the company's commitment to this effort. Chairperson Commers explained that HRA Resolution No. 7 -1998 would accomplish the following: 1. The authorization to execute and deliver the Contract with Duke is hereby in all respects revoked; 2. Any prior authorization to execute and deliver other contracts for Private Redevelopment of the same property is hereby in all respects revoked; 3. The Authority staff is directed to communicate this Resolution to Duke or any other entity for which an execution of a Contract for Private Redevelopment has been authorized immediately by facsimile and United States mail; HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 26, 1998 PAGE 5 4. The Authority staff is authorized and directed to take all such further actions deemed necessary to effectuate the terms and intent of the Resolution. MOTION by Mr. Meyer, seconded by Ms. Gabel, to adopt Resolution No. 7 -1998, a Resolution Revoking the Authorization for the Execution and Delivery of a Contract for Private Redevelopment by and between the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota and Duke Realty Investments, Inc. UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. MOTION by Mr. Meyer, seconded by Ms. Gabel, to adjourn the June 26, 1998, Emergency Meeting of the Housing & Redevelopment Authority. UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, CHAIRPERSON COMMERES DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE JUNE 26, 1998, EMERGENCY MEETING OF THE HOUSING AND REDEVELOPMENT AUTHORITY BOARD ADJOURNED AT 5:55 P.M. Respectfully submitted, Tamara D. Saefke oa Recording Secretary CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING AUGUST 6, 1998 Vice - Chairperson Schnabel called the August 6, 1998, Housing and Redevelopment Authority meeting to order at 7:34 p.m. ROLL CALL: Members Present: Virginia Schnabel, John Meyer, Jim McFarland Members Absent: Larry Commers, Pat Gabel Others Present: Grant Femelius, Housing Coordinator Jim Casserly, Financial Consultant William Bums, City Manager Craig Ellestad, Accountant Mike and Jackie Egan Councilmember Robert Barnette MOTION: by Mr. McFarland, seconded by Mr. Meyer, to approve the July 2, 1998, Housing and Redevelopment Authority minutes as presented in writing. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. CONSENT AGENDA: Mr. Femelius asked that this item be removed from the Consent Agenda for further discussion. _Z9 -► MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the Consent Agenda AS AMENDED. Dili i I'll i WA5-111311 IMAM UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. Discussion of Item 1: Mr. Femelius explained that this item was previously discussed at the July HRA meeting. Since that time, Mr. and Mrs. Egan have found that the cost of the home will exceed the amount they wish to spend. Therefore, they are requesting consideration of a change to their initial plans. The revised plan is very similar to the original design, but is approximately 373 square feet smaller and has a two -car attached garage rather than a three -car garage. Staff recommends HRA approval and this item was placed on the Consent Agenda. Mr. Femelius stated that it was just brought to his attention that Mr. and Mrs. Egan have been made aware of some potential water problems on the site and surrounding areas. No sub - surface investigation has been completed on the site; therefore, staff is recommending that the HRA authorize staff to work with Mr. and Mrs. Egan to investigate the possible water problem and expend up to $10,000 to correct any water problems on the site. Mrs. Egan explained that neighbors have informed them that there is water ponding on the site. One individual stated that there is a spring on the lot or close to it and they would like to be aware of any potential problems before they close on the property. The closing for the property has been scheduled for Friday, August 7th. Mr. Bums explained that this problem was just brought to staffs attention. Delaying action on this item could affect construction schedules and run into the end of the construction season. Therefore, it was his recommendation that staff request authorization for expenditure of funds to correct any water problems on the site so that construction could begin. Mr. Meyer stated he is concerned that if the HRA authorizes this, it may be setting a precedent that they would need to stand behind any site condition problems for HRA lots sold. Mr. Femelius stated he did not feel it would set a precedent. Staff would like to bring the project to a conclusion. Furthermore, if the site is in need of correction, it would essentially be worth considerably less than the amount that Mr. and Mrs. Egan are paying for it. Mr. Meyer stated he personally would like to know the nature of the problems and what corrective action is needed prior to. authorizing staff to proceed with corrective measures. He asked if Mr. and Mrs. Egan have included a sump pump in their plans. . • �� L_ •_ RM WAIJ _00 • III Mrs. Egan responded in the affirmative, but stated the problem may require more than just a sump pump and drain tile. One of the neighbors had indicated that their sump pump runs continuously in the spring. Ms. Schnabel asked if the $10,000 expenditure could be limited to a scope of work. Mr. Femelius responded that it could be limited to soil correction costs if the HRA desires. Mr. Casserly stated that the HRA would choose the least expensive and effective way to correct the problem. Mr. Femelius stated if there is indeed a soil problem which required corrective action, the process could easily take at least a month: however, if the problem is not significant, it is the Egan's hope that construction could begin as soon as possible. MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the Change in House Plans for 530 Hugo Street N.E. UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. MOTION by Mr. McFarland, seconded by Mr. Meyer, to authorize staff to work with Mr. and Mrs. Egan to do soil testing and corrective work to make the lot buildable at 530 Hugo Street N.E. at a cost of up to $10,000. UPON A VOICE VOTE, SCHNABEL AND MCFARLAND VOTING AYE, MEYER VOTING NAY, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED. ACTION ITEMS: 12, IM Mr. Femelius explained that Mr. and Mrs. Jordan have obtained prices for their proposed home and determined that the cost is beyond their budget; therefore, they would like to modify the plans and bring them back before the HRA for consideration. At this time, it would be appropriate to table this item. Ms. Schnabel asked that staff look at any potential water problems for this site as well and report back to the board. MOTION by Mr. Meyer, seconded by Mr. McFarland, to table this item. UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. l�i�l -lam . —. �__ • 1 -• • �� • . acmm 4. RESOLUTION AUTHORIZING EXECUTION OF A CONTRACT FOR PRIVATE REDEVELOPMENT WITH DUKE CONSTRUCTION LIMITED PARTNERSHIP. Mr. Casserly explained that staff received a draft of the contract last week and with all of the discussions that they have been having with Medtronic, they have not had the time to adequately sort out the issues of the contract. Therefore, he asked that discussion of this item be delayed until the September HRA meeting. Mr. Meyer stated he was surprised to see this proposal still "on the books" while the. City is having discussions with Medtronic. He asked if the HRA really wants to pursue this at this time. Mr. Casserly explained that if for some reason Medtronic decides to withdraw from the project, this would allow the City to be in a better position to see a project go forward for the site. The agreement is clearly contingent upon the HRA not reaching an agreement with Medtronic. Tabling this for further discussion at the September HRA meeting would also give the City a better idea as to Medtronic's position in the development. MOTION by Mr. Meyer, seconded by Mr. McFarland, to table this item until the September HRA meeting. UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Burns explained that staff is recommending that the lights installed several years ago be repainted. The project would consist of repainting 81 fixtures to their original bronze color (which would then match the lights to be installed on 57th Avenue) at a cost not to exceed $7,290.00. MOTION by Mr. McFarland, seconded by Mr. Meyer, to authorize staff to contract for the painting of 81 light fixtures, in an amount not to exceed $7,290.00. UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Femelius explained that this is the third year that the HRA has had the opportunity of having an HRA tax levy for the certification of taxes payable in 1999. The funds can be used for any general HRA operation including programs and services that they offer. Over the past two years, the HRA has used this money to help support the housing rehab programs and to help repay the $1.5 million loan from the city. The state law allows the HRA to levy a tax against all taxable real property in the city. In order to levy a tax for 1999, the HRA must adopt a resolution and the City Council must adopt a similar resolution at their August 24, 1998 meeting. Ms. Schnabel asked if staff has ever received any comments from the public in regard to the City's use of the funds. Mr. Femelius stated he is not aware of any. Ms. Schnabel stated she feels the housing programs have been well received by the community, and it helps to improve the housing stock in the city. Mr. Meyer stated he is in approval of the tax levy. However, he continues to be dismayed at the type of homes that are receiving assistance under the programs. He stated he thinks the income limits for the programs are too high and the allowable expenditures too liberal. MOTION by Mr. McFarland, seconded by Mr. Meyer, to adopt Resolution No. HRA 14- 1998, A Resolution Adopting a 1998 Tax Levy Collectible in 1999. UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. INFORMATION ITEMS: Mr. Femelius stated the acquisition of JR's Automotive property was completed on June 26. Over the course of the next few months, staff will be working with the environmental consultant to address any contamination issues. The building will need to be kept in place to qualify for tax increment purposes. Mr. Femelius stated staff has also done some research with legal counsel on the duplex property. At this time, it appears that if the City is to acquire the property, they should have a plan for replacing the housing units for affordable housing. One option may be to move the duplex to another site and preserve those units or to construct new units on another site. Mr. Femelius stated that of the two vacant properties, one went tax forfeit this spring. Approximately two weeks ago, the City was contacted by the individual who previously owned the property and he has expressed interest in constructing a four -unit townhome project on the site. Staff recommends waiting out until the expiration of the redemption period. Mr. Femelius noted that site plans have been prepared by Mark Koegler from Hoisington Koegler. Four scenarios are currently being evaluated, ranging in size from 14 units to 22 units. He noted that staff talked with the City Council on July 20 in regard to this project and that they appeared to be very supportive. Unless otherwise directed, staff intends to work aggressively on this project and generally is looking at a project taking place in mid 1999. 8. 621 LAFAYETTE STREET UPDATE: Mr. Fernelius noted that at the July 2 meeting of the HRA, staff discussed the acquisition of 621 Lafayette Street, adjacent to a parcel that the HRA already owned at 611 Lafayette. At that time, staff suggested that the two sites be combined to create one buildable site. Mr. Fernelius stated the property at 621 Lafayette is in fairly good condition, and the HRA did express some reservations about acquiring the property due to its condition. The HRA's direction at that time was to see if any of the adjoining property owners would be interested in purchasing the lot from the City. At this point, it does not appear that there is any interest. Therefore, the HRA will continue to hold on to the property at this time, and perhaps in the future consider splitting it and conveying it to the adjoining properties. Mr. Casserly distributed information regarding the TIF assistance for soil correction work at the property located at 8234 Main Street N.E. (Cintas Uniform). He noted that this issue was discussed at the July HRA meeting and, at that time, staff was directed to obtain further information in regard to what was being proposed for the site, the costs involved and the valuations. Information was provided regarding the history of the company itself. The proposal for the property is to construct a 51,000 square foot building on a six acre site. The building would be designed so that an additional 14,000 square feet of expansion space would be available. They currently have 60 employees and anticipate that after the first full year of operation it will increase to 75 employees with 130 being anticipated after three years. The total project cost is approximately $4.9 million. The assistance being requested for soil correction is 5% of the project costs (approximately $250,000). The assistance would be provided in the form of a revenue note. Mr. Casserly stated staff is requesting approval of up to $250,000 for soil correction work. They believe this is a good use for the site. The applicant would like to begin construction as soon as possible. Mr. Meyer asked if there are any procedures which staff follows to verify the cost of soil correction. • �� _ • ' ��_ �� • N. WAIF, h • .. ; Mr. Casserly explained that it is often very difficult to get accurate bids on soil correction work. Estimates are obtained, however, and when the work is actually completed, an architect or engineer verifies that the amounts claimed are in fact spent for soil correction as authorized. Often the invoices are on file as well as lien waivers. He stated that the City will reimburse them for the expenses. It was the general consensus of the HRA to proceed with this project. Ms. Schnabel noted that the Monthly Housing Program Summary was included in the packet. Mr. Femelius stated that staff is preparing to discuss the delinquent loan issues at the September meeting �J�L•Pl:l. ►l��I�YI MOTION by Mr. McFarland, seconded by Mr. Meyer, to adjourn the HRA meeting at 8:55 p.m. UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE AUGUST 6, 1998, HOUSING & REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 9:00 P.M. Respectfully submitted, Tamara D. Saefke o� Recording Secretary MEMORANDUM HOUSING REDEVELOPMENT AUTHORITY DATE: August 28, 1998 TO: William Bums, Executive Director of HRA 4154 FROM: Barbara Dacy, Community Development Director Grant Femelius, Housing Coordinator SUBJECT: Clarification Regarding Acquisition of 5859 3`d St. At the July 1998 meeting, the HRA approved the acquisition of this property. Staff had negotiated a purchase price of $43,000 with Mid America Bank which had received the property through foreclosure. The property had been appraised at $46,000. Prior to the HRA meeting, staff discovered that there were approximately $9,780 in outstanding water bills and delinquent taxes. The bank agreed to pay these expenses at closing. During the HRA meeting, there was some confusion about the delinquency issue and who was actually paying the expenses. After considerable discussion, the HRA felt the purchase price should be reduced by the amount of the delinquencies. The HRA authorized the acquisition for $34,000. Since the HRA meeting, staff has been working with Norwest Bank (which bought out Mid America Bank) to coordinate the closing. The loan officer at Norwest reviewed the details of the transaction and felt that the bank was paying for the delinquencies twice -- first, by reducing the sale price from $43,000 to $33,220 and then again by bringing a check to closing for the amount of the delinquencies. In essence, the net amount they would receive is $23,440. The bank said they will not sign the purchase agreement as presented. They will agree to pay the delinquencies out of the sales proceeds. The funds would be deducted by the title company at closing and paid to the City and County directly. The gross sales price would be $43,000, of which the bank would receive is $33,220. I 5859 Td St. Memo August 28, 1998 Page 2 Recommendation Staff recommends that the HRA re- authorize the purchase of 5859 - 3`d St. for the $43,000 subject to Norwest Bank paying the delinquent taxes and water bill in the amount of $9,780. GF M -98 -183 IA MEMORANDUM HOUSING REDEVELOPMENT AUTHORITY DATE: August 28, 1998 TO: William Burns, Executive Director of HRA 4�p FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Consider Extension to Contract for Private Development with Jim Glidden for Vacant Lot at 5857 Main St. At the July 1998 HRA meeting, the HRA approved the house plans and development contract for Jim Glidden. Mr. Glidden is purchasing the vacant lot at 5857 Main St. Unfortunately, Mr. Glidden is having difficulty finding a buyer for the property. Under the program guidelines, the builder must have a purchase agreement in place for the home before the HRA conveys title. The purpose of this requirement is to avoid building on speculation and perhaps having a lesser quality home than one built for a specific buyer. The builder was supposed to execute the development contract and close on the property by August 1, 1998. The construction was to have started by October 15, 1998. Staff and the developer have met and discussed several options, including granting a 60 day extension or terminating the relationship and negotiating with another builder. Starting over with a new builder /buyer team may not be prudent at this point given the time and money invested by both parties. We believe the developer is making an earnest effort to market the site and find a buyer. The biggest problem is trying to sell a specific plan for a vacant lot with no model to show. •L •- • Staff recommends that the HRA move to authorize a 60 day extension to the Contract for Private Development with Jim Glidden. The extension would give the builder until October 1, 1998 to find a buyer. If the builder is unable to provide evidence of buyer by this date, the developer could either begin construction on a speculative home or terminate his interest in the property. gf M -98 -184 2 a _/ MEMORANDUM HOUSING REDEVELOPMENT AUTHORITY DATE: August 28, 1998 TO: William Bums, Executive Director of HRAA4p FROM: Barbara Dacy, Community Development Director Grant Femelius, Housing Coordinator SUBJECT: Consider Utility Easement for 1015 Mississippi St. The HRA acquired this property in April 1998. The property is located near the intersection of Mississippi St. and Highway 65. The adjoining property owners are requesting a utility easement across the back 10 feet of the HRA lot (see attached map) to connect to the City's sanitary sewer system. The property owners are planning to construct a new home on the lot and can only access the sewer system via the HRA site. There is an existing 5 foot drainage and utility easement, but from a practical standpoint this is inadequate for a sewer pipe. The petitioner is requesting that the HRA expand the easement to a full 10 feet. The cleanest way to accomplish this is to vacate the existing 5 foot easement and create a new 10 foot easement. The vacation request would have to go through the Planning Commission and be approved by the City Council. Recommendation Staff recommends that the HRA grant a 10 foot drainage and utility easement along the north property line of 1015 Mississippi St. subject to the following conditions: The petitioner would prepare all easement language and documents (subject to review by HRA legal counsel) and pay all recording costs. The language would include provisions that the beneficiary of the easement would be responsible for restoring any property that was damaged as a result of construction in the easement area. 3 1015 Mississippi Street August 28, 1998 Page 2 2. The petitioner will pay the $250 easement vacation fee to the City of Fridley 3. The petitioner shall pay for a full survey of the HRH's lot at 1015 Mississippi St. This would have to be done at some point in the future when the HRA sells the property and would be convenient to address the issue at this time. gf M -98 -185 3 -A LA • SIB NIV ---------- -------- --- ---------- Sewer Al 10 5 7 • - -, sm I A',A?NE MCP - IT Sanitar on Pro I 1 4 lu 4- St. SPP ,T y 0, r. • W ewer 0 LU 5 ;sed LO - New Lot 1 ----------- 35tpp,:5 qtj E -------------- - --- ----------- AbrwAftd Faskm Ids F1 3 273 -SwdmvQu-wfQ- Sanitary Pipe "S03" Omft 06/16/19a Fit between'/Qmarter>OV Locator Map for. S.d. I kch - 2W fim N 1/2 SEC 13, T.30, K24, QQ.23 Water S-My F%m eQ��'a`ter&mndary Sanitary Sewer Syste J4 7 !9 .1 Right -d-Way Parcels ■ ussmim DRAFT 3-5 MEMORANDUM HOUSING REDEVELOPMENT AUTHORITY DATE: August 24, 1998 TO: William Bums, Executive Director of HRA'0 FROM: Barbara Dacy, Community Development Director SUBJECT: Consider Resolution Authorizing Execution of Development Contract with Cintas Corporation Background At the August 6, 1998, HRA meeting, Jim Casserly provided an update on the negotiations with Cintas Corporation. Since the HRA's meeting in August, a development contract has been prepared according to the HRA's direction. Proposed Protect Cintas is pursuing acquisition of the six acre site at 8234 Main Street for a uniform washing operation. A copy of the development contract is included in the HRA's packet. The contract requires, as the "minimum improvements ", the construction of a 51,000 square foot building. Upon issuance of a certificate of completion, the HRA will issue a limited revenue note in the amount of $250,000 (present value). The note will be payable in semi - annual installments commencing on August 1, 2001, and concluding in the year 2007. The total project cost is approximately $4.9 million. Cintas is paying approximately $409,000 for the land, $2.5 million for the building, and approximately $2 million for the equipment. The soil correction required for the site is extensive. Staff has received copies of the soil boring reports which confirm the existence of very deep peat soils throughout the site. The limited revenue note will be issued directly to Cintas. The proposed assistance amount is within the HRA's guidelines for pay -as- you -go projects, or 5% of the total project cost. n Cintas Corporation August 24, 1998 Page 2 Cintas anticipates that 75 employees will occupy the building during their first year of operation, and Cintas hopes to expand to 130 employees and possibly add a second addition to 65,000 square feet. Recommendation Staff recommends that the HRA approve the resolution as attached authorizing execution of the development contract with Cintas Corporation. BD:Is M -98 -181 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY COUNTY OF ANOtiA STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A CONTRACT FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY FRIDLEY CINTAS CORPORATION NO. 1. BE IT RESOLVED by the Board of Commissioners. (the "Commissioners ") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority ") as follows: Section 1. Recitals. 1.01. It has been proposed that the Authority enter into a Contract For Private Redevelopment (the "Contract ") with Cintas Corporation No. 1 (the "Redeveloper "). Section 2. Findings. 2.01. The Authority hereby finds that it has approved and adopted a development program known as the Modified Redevelopment Plan for its Redevelopment Project No. I (the "Redevelopment Program ")pursuant to Minnesota Statutes, Section 469.001 et seq. 2.02. The Authority hereby finds that the Contract promotes the objectives as outlined in its Redevelopment Program. Section 3. Authorization for Execution and Delivery. 3.01. The Chairman and the Executive Director of the Authority are hereby authorized to execute and deliver the Contract when the following condition is met: Substantial conformance of a Contract to the Contract presented to the Authority as of this date. Adopted by the Board of Commissioners of the Authority this day of , 199. Chairman ATTEST: Executive Director G:\ WPDATA \F \FRIDLEY \06 \DOCS \CONTRES.DOC 4 -C CITY OF FRIDLEY PENK / PETERSON SITE ASSUMPTIONS PIN 3- 30 -24 -14 -0005 Original Market Value Original Tax Capacity 2.45% <= 150,000 3.50% > 150,000 Estimated Market Value 51,000 sq. ft. @ Estimated Tax Capacity 2.45% <= 150,000 3.50% > .150,000 Estimated Taxes 51,000 sq. ft. @ Pay 1997 Tax Rate 1.2390338 Construction 1999 Valuation 2000 Taxes Payable 2001 Admin Fees 10.00% Inflation 0.00% P.V. Rate 12/01/98 7.50% 215,000 5,950 $40.00 /sq. ft. = 2,040,000 69,825 1.70 /sq. ft. = 86,516 4 -D Penk.wk4 PREPARED BY KRASS MONROE, P.A. 08/04/98 CITY OF FRIDLEY 4 -E Penk.wk4 PREPARED BY KRASS MONROE, P.A. 08/04/98 PENK / PETERSON SITE CASH FLOW AND PRESENT VALUE ANALYSIS Original Estimated Captured Estimated Less: Available 7.50% P.V. Rate Tax Tax Tax Tax Admin Tax Semi Annual Cumulative Date Capacity Capacity Capacity Increment Fees Increment Balance Balance 06/01/97 5,950 5,950 0 0 0 0 0 0 12/01/97 5,950 5,950 0 0 0 0 0 0 06/01/98 5,950 5,950 0 0 0 0 0 0 12/01 /98 5,950 5,950 0 0 0 0 0 0 06/01/99 5,950 5,950 0 0 0 0 0 0 12/01/99 5,950 5,950 0 0 0 0 0 0 06/01/00 5,950 69,825 0 0 0 0 0 0 12/01/00 5,950 69,825 0 0 0 0 0 0 06/01/01 5,950 69,825 63,875 39,572 3,957 35,614 29,627 29,627 12/01/01 5,950 69,825 63,875 39,572 3,957 35,614 28,556 58,183 06/01/02 5,950 69,825 63,875 39,572 3,957 35,614 27,524 85,707 12/01/02 5,950 69,825 63,875 39,572 3,957 35,614 26,529 112,236 06/01/03 5,950 69,825 63,875 39,572 3,957 35,614 25,570 137,806 12/01/03 5,950 69,825 63,875 39,572 3,957 35,614 24,646 162,452 06/01/04 5,950 69,825 63,875 39,572 3,957 35,614 23,755 186,207 12/01/04 5,950 69,825 63,875 39,572 3,957 35,614 22,897 209,104 06/01/05 5,950 69,825 63,875 39,572 3,957 35,614 22,069 231,173 12/01/05 5,950 69,825 63,875 39,572 3,957 35,614 21,271 252,444 06/01/06 5,950 69,825 63,875 39,572 3,957 35,614 2Q,502 272,946 12/01/06 5,950 69,825 63,875 39,572 3,957 35,614 19,761 292,708 06/01/07 5,950 69,825 63,875 39,572 3,957 35,614 19,047 311,755 514,431 51,443 462,988 311,755 311,755 4 -E Penk.wk4 PREPARED BY KRASS MONROE, P.A. 08/04/98 TO: FRIDLEY H.R.A FROM: CITY OF FRIDLEY RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES AUGUST 1998 ADMINISTRATIVE BILLING: ADMINISTRATIVE PERSONAL SERVICES ADMINISTRATIVE OVERHEAD COMPUTER OVERHEAD (For Micro & Mini computers) TOTAL ADMINISTRATIVE BILLING: OPERATING EXPENSES: USPS - POSTAGE FRIDLEY - LOCK & HASP, VACANT HOME US WEST - TELEPHONE USPS - POSTAGE FRIDLEY - MEAL MTG, BIG APPLE FRIDLEY - MEAL MTG, ANCHORAGE BENEFITS EXPENSES: Account #'s for HRA's Use Account #'s for CR City's Use Code TOTAL OPERATING EXPENSES: 190.88 CITY OF FRIDLEY - HEALTH INS 262 - 0000 - 219 -1001 185.59 236 -0000- 219 -1001 11 CITY OF FRIDLEY - DENTAL INS 262 - 0000 - 219 - 1100 22.53 236- 0000 - 219 -1100 12 CITY OF FRIDLEY - LIFE INS 262- 0000 - 219 -1200 3.50 236- 0000 - 219 -1200 13 TOTAL BENEFITS EXPENSES: 211.62 TOTAL EXPENDITURES File: 1EXDATAWRA %TIFl9813ILL.)ds Details - AUGUST 1998 21,006.58 101 - 0000 - 341 -1200 H1 292.58 101- 0000 - 336 -3000 HA 212.42 101 - 0000 - 336 -3000 HA 100 -0000 - 430 - 4107 21.511.58 262 -0000- 430 -4332 52.73 236 -0000 - 336 -3000 HA 100 - 0000 - 430 -4221 11.76 236 - 0000 - 336 -3000 HA 100 -0000- 430 -4332 25.62 236 -0000- 336 -3000 HA 100 - 0000 - 430 -4332 11.34 236-0000- 336 -3000 HA 100 - 0000 - 430 -4337 24.77 236 - 0000 - 336 -3000 HA 100 - 0000 -430 -4337 64.66 236 - 0000 - 336 -3000 HA TOTAL OPERATING EXPENSES: 190.88 CITY OF FRIDLEY - HEALTH INS 262 - 0000 - 219 -1001 185.59 236 -0000- 219 -1001 11 CITY OF FRIDLEY - DENTAL INS 262 - 0000 - 219 - 1100 22.53 236- 0000 - 219 -1100 12 CITY OF FRIDLEY - LIFE INS 262- 0000 - 219 -1200 3.50 236- 0000 - 219 -1200 13 TOTAL BENEFITS EXPENSES: 211.62 TOTAL EXPENDITURES File: 1EXDATAWRA %TIFl9813ILL.)ds Details - AUGUST 1998 .— eo ' C7 W ' Qm n 5 me , z ►- , , a , o IL , , W Oe ' r , Z L, O A, M a M O O N M ' ' g N v M N �! 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O. O, O, O. O.O. a O, o� v4 �4 +f .1 .4 H .1 of .4 N .1 .4 ri vi �q \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ wwMMMwMwMwMMwMMMMMwMMMWR cOwwww.MwwwMwMwG3MMwwMMMww. O Q O F- u a CC F" A 5 -B MEMORANDUM HOUSING •�1 REDEVELOPMENT AUTHORITY DATE: August 28, 1998 TO: William Bums, Executive Director of HRA FROM: Barbara Dacy, Community Development Director Grant Femelius, Housing Coordinator SUBJECT: Consider House Plan and Contract for Private Development with Guy and Cathy Jordan for Vacant Lot at 540 Hugo St. The HRA authorized the sale of this lot for $25,000 at the July 2, 1998, meeting. The buyers, Guy and Cathy Jordan, had not finalized their house plans and therefore were not ready to enter into a development contract. This item was scheduled for consideration by the HRA at their August 6, 1998, meeting. However, the Jordans discovered that the house plan was more expensive than their budget would allow and requested more time to draft a new house plan. As a result, the item was tabled by the HRA until the September 3, 1998, meeting. Project Summary The Jordans plan to construct a two -story, single family home with 3 bedrooms, 2 full bath, kitchen, dining room and living room on the main level with a total of 1,215 s.f. of living space. The partially finished lower level which also serves as the entrance includes a laundry, future bedroom, and family room for a total of 965 s.f. of additional space. Total square footage of 2,180. The plan also includes a 2 car, attached, tuck -under garage. The buyers will act as their own general contractor and sub - contract a majority of the work. They will be working with Help U Build homes, a private consulting firm, to bid the project and assist with technical issues. The Jordan's have been pre- approved for construction financing. During construction they only pay interest on the funds they actually draw down. Up to four draws are allowed to lJ Guy and Cathy Jordan August 28, 1998 Page 2 pay for the materials and labor. At the end of construction, the borrower begins making regular mortgage payments. The redevelopment contract spells out the details of the transaction such as the purchase price of the lot, date of closing, date construction will start and be completed, etc. Once the agreement is signed, the Jordan's have until October 1, 1998 to execute the development contract and close on the property. Construction would need to start by November 15, 1998 and be completed by June 15, 1999. The builder would pay cash for the site at closing. A copy of the house plans are attached. -1.. . Staff recommends that the HRA approve the attached resolution authorizing the execution and delivery of a Contract for Private Development agreement with Guy and Cathy Jordan. Attachment gf M -98 -186 6 -A HRA RESOLUTION NO. A RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A CONTRACT FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, "— MINNESOTA AND GUY W. JORDAN AND CATHERINE S. JORDAN. BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority") as follows: Section 1. Recitals. 1.01. It has been proposed that the Authority enter into a Contract For Private Redevelopment (the "Contract ") with Guy W. Jordan and Catherine S. Jordan (the "Redeveloper ") and to approve construction plans (the "Construction Plans ") as provided for in the Contract. Section 2. Findings. 2.01. The Authority hereby finds that it has approved and adopted a development program known as the Modified Redevelopment Plan for its Redevelopment Project No. 1 (the "Redevelopment Program ") pursuant to Minnesota Statutes, Section 469.001 et seq. 2.02. The Authority hereby finds that it has approved and adopted a Housing Replacement District Plan (the "Plan") and created Housing Replacement District No. 1, pursuant to and in accordance with Laws of Minnesota 1995, Chapter 264, Article 5, Sections 44 through 47, inclusive, as amended and supplemented from time to time. 2.03. The Authority hereby finds that it has performed all actions required by Minnesota Statutes and approved the sale of property that is subject to the terms of the Contract. 2.04. The Authority hereby finds that the Contract promotes the objectives as outlined in its Redevelopment Program and the Plan. Section 3. Authorization for Execution and Delivery of the Contract. 3.01. The Chairman and the Executive Director of the Authority (the "Officers ") are hereby authorized to execute and deliver the Contract with such additions and modifications as the Officers may deem desirable or necessary as evidenced by their execution. X41 P -•- Section 4. Approval of the Construction Plans. 4.01. The Construction Plans are hereby approved. PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY IN FOR THE CITY OF FRIDLEY, MINNESOTA, THIS DAY OF '199 LAWRENCE R. COM?d ERS - CHAIRMAN ATTEST: WILLIAM W. BURNS - EXECUTIVE DIRECTOR G: \WPDATA \F \FRIDLEY \25 \JORDAN \DOGS \RESOLOTION.DOC 0 \ 6 -C MEMORANDUM HOUSING AND REDEVELOPMENT AUTHORITY DATE: August 28, 1998 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Update on Soil Testing at 530 and 540 Hugo St. At the August 1998 HRA meeting, the purchasers of 530 Hugo St., Mike and Jackie Egan, indicated that they had been informed by neighbors of a potential water problem on the site. Apparently several neighbors reported that there is a significant amount of runoff onto the site and possibly a high water table or underground spring. Obviously, the Egans are concerned about this issue and do not want to close on the property until more information is made available. At the meeting, the HRA authorized the expenditure of up $10,000 to investigate and correct any potential water problems on the property. The HRA also directed staff to check into the soil conditions on the adjacent lot at 540 Hugo St. The Assistant City Engineer has visited the site and believes that there may be surface water problems, but those can be fixed by re- grading the site. In addition, staff has contracted with Braun Intertec to conduct a soil and water test on the site. The investigation will include a test boring to determine the soil type /condition and measure the water table. The report will indicate whether the soils are suitable for building. The total cost for the tests and reports on both sites is $1,650. These expenses will be charged to the scattered site program. gf M -98 -187 7 Fridley HRA Monthly Housing Program Summary September 3, 1998 1. Loan Origination Report Covers the loans and grants issued in 1998, through 8- 25 -98. This report shows activity both city -wide and in the Hyde Park neighborhood. 2. Loan Servicing Report Covers HRA funded loans only. Report summarizes all of the loans being serviced (including prior years) by the Community Reinvestment Fund (CRF) for the most recent reporting period, 7- 31 -98. 3. Delinquent Loan Report (see attached memo) Report shows the number of loans that are considered delinquent. There are four categories (1 month, 1 -2 months, 2 -3 months, over 3 months). The report also shows the total amount of delinquent payments along with the total loan principal outstanding. Report covers activity through 7- 31 -98. 4. Other Information None Monthly Housing Report Cover (5 -7 -98 HRA) 8 LOAN ORIGINATION REPORT Month Ending Aug -98 Cltv Wide Loans and Grants Total $ 415,02426 29 $ 5,897.00 1 $ 38,044.00 3 $ 458,96526 33 Hyde Park Loans and Grants HRA MHFA CDBG / HOME Date I Type of Name Address Loans Loans Grants Total Closed Property Program Kroone 5933 Main St. NE $ 9,277.18 1 $ - $ - $ 9,277.18 1 623/98 Single - family 5% Loan $ 424,301.44 30 $ 5,897.00 1 $ 38,044.00 3 $ 468,242.44 34 1888 (AUG) LOAN ACTIVITY REPORT LOAL - AUG 1888 almm 8A HRA I MHFA I CDBG / HOME I I Date Type of Name Address Loans Loans Grants Total Closed I Property Program Reineck 143 - Horizon Circle $ 23,978.00 1 $ $ $ 23,978.00 1 127198 Single - family 5% Loan Flan 6558 Oakley SL $ 8,800.00 1 $ $ $ 8,800.00 1 3/17198 Single - family 5% Loan Mahoney 261 -67th Ave. NE $ - $ $13,383.00 1 $ 13,383.00 1 319/98 Single- family CDBG Grant Ecker 6380 Starlite Blvd. $ $ $ 9,621.00 1 $ 9,621.00 1 1116/98 Single- fammly CDBG Grant Marclnlak 601 - 58th Ave. NE $ $ $15,040.00 1 $ 15,040.00 1 3128198 Single-family CDBG Grant Harlander 136 - River Edge Way $ 25,000.00 1 $ $ $ 25,000.00 1 421198 Single- family 5% Loan Van Auken 1475 - 73rd Ave. NE $ 6,000.00 1 $ $ $ 6,000.00 1 423/98 Single- family 5% Loan Marcinlak 617 - Hugo SL NE $ 4,922.86 1 $ $ $ 4,922.86 1 5/5/98 Single- family 5% Loan Hinrichs 7355 Hayes St. NE $ 3.900.00 1 $ $ $ 3,900.00 1 5/5198 Single- family 5% Loan Dirkes 680 - Ironton St. NE $ 2,400.00 1 $ $ $ 2,400.00 1 5/5/98 Single-family 5% Loan Dougherty 7420 Concerto Curve $ 16,118.19 1 $ $ $ 16,118.19 1 5112/98 Single - family 5% Loan Bailey 1828 Gardena Ave. NE $ 9,900.00 1 $ $ $ 9,900.00 1 5119/98 Single - family 5% Loan Nelson 7530 Tempo Terr. $ 13,35525 1 $ $ $ 13,35525 1 5119/98 Single- family 5% Loan Zelenak 7526 - 4th St. NE $ 7,500.00 1 $ $ $ 7,500.00 1 5119/98 Single - family 5% Loan Kok 6517 MclOnley SL NE $ 23,077.00 1 $ $ $ 23,077.00 1 5/19/98 Single - family 5% Loan Miller 591 - Dover SL NE $ 25,000.00 1 $ $ $ 25,000.00 1 528198 Single- family 5% Loan Smith 4610 2 -12 St. NE $ 12,400.00 1 $ $ $ 12,400.00 1 62/98 Single- family 5% Loan Gunia 117 - Alden Circle $ 25,000.00 1 $ $ $ 25,000.00 1 62198 Single - family 5% Loan Cannon 6750 Monroe St. NE $ 23,287.73 1 $ $ $ 23,287.73 1 619/98 Single- family 5% Loan Borman 120 River Edge Way $ 23,923.94 1 $ $ $ 23,923.94 1 619!98 Single - family 5% Loan Maki 7341 Concerto Curve $ 3,775.00 1 $ $ $ 3,775.00 1 6130/98 Single - family 5% Loan Harff 1311 - Creek Park Ln. $ 20,000.00 1 $ $ $ 20,000.00 1 6130/98 Single - family 5% Loan leslie 600 - Hugo St. $ 24,425.00 1 $ $ $ 24,425.00 1 721/98 Single - family 51% Loan Peterson 6757 Washington St. $ 10,000.00 1 $ $ $ 10,000.00 1 721/98 Single - family 5% Loan Nelson 250 - 61st Ave. $ 22,940.00 1 $ $ $ 22,940.00 1 721/98 Single - family 5% Loan Klein $ 25,000.00 1 $ $ $ 25,000.00 1 7/30/98 Single - family 5% Loan Jacob 6251 Rainbow Dr. $ 11,500.00 1 $ $ $ 11,500.00 1 814/98 Single - family 5% Loan Berg $ 2,385.00 1 $ $ $ 2,385.00 1 814/98 Single - family 5% Loan Anderson 6442 Van Buren SL $ 1,108.00 1 $ $ $ 1,106.00 1 814/98 Single-family 5% Loan Simonson 800 Pandora Dr. $ 22,260.00 1 $ $ $ 22,260.00 1 614/98 Single-family 59/6 Loan Johnson 6800 Monroe SL $ - $5.897.00 1 $ $ 5,897.00 1 8/4198 Single-family MHFA Loan Hamm 563- Janesville St. $ 6,133.00 1 $ $ $ 6,133.00 1 8111/98 Single - family 5 % Loan Bartlett 5085 Topper Ln. $ 10,93729 1 $ $ $ 10,93729 1 8/11/98 Single - family 5% Loan Total $ 415,02426 29 $ 5,897.00 1 $ 38,044.00 3 $ 458,96526 33 Hyde Park Loans and Grants HRA MHFA CDBG / HOME Date I Type of Name Address Loans Loans Grants Total Closed Property Program Kroone 5933 Main St. NE $ 9,277.18 1 $ - $ - $ 9,277.18 1 623/98 Single - family 5% Loan $ 424,301.44 30 $ 5,897.00 1 $ 38,044.00 3 $ 468,242.44 34 1888 (AUG) LOAN ACTIVITY REPORT LOAL - AUG 1888 almm 8A LOAN SERVICING REPORT Month Ending July 1998 Installment Loans Number of Loans in Portfolio 166 Principal Payments $ 15,413.84 Interest Payments $ 8,307.81 Late Fees $ - $ 23,721.65 Ending Principal Balance I $ 1,918,850.09 Deferred Loans Number of Loans in Portfolio 24 Principal Payments $ 6,611.70 Interest Payments $ 149.75 Late Fees $ - $ 6,761.45 Ending Principal Balance $ 118,511.38 Totals Total Loans in Portfolio 190 Principal Paid $ 22,025.54 Interest Paid $ 8,457.56 Late Fees Paid $ - $ 30,483.10 CRF Monthly Servicing Fee $ 786.00 NET FUNDS RECEIVED $ 29,697.10 TOTAL OUTSTANDING LOAN PRINCIPAL $ 2,037,361.47 1998 (AUG) LOAN ACTIVITY REPORT LSR - JUL 1998 8/25/98 B .'e P Fridley Loan Program Loan Delinquencies 7/31/98 Number of Loans (188) 17 1 0 5 Total Monthly Payments $ 2,530.94 $ 628.86 $ - $ 2,637.14 Outstanding Principal * $194,861.93 $16,429.55 $ - $ 46,539.10 % of Portfolio 9.6% 0.8% 0.0% 2.3% File: DELINQUENCY REPORT (1 -98) 8-C Worksheet LOAN DELIQUENCIES Date: 8/25/98 8/25/98 1 to 2 2 to 3 Over 3 Loan Data 1 Month Months Months Months Number of Loans (188) 17 1 0 5 Total Monthly Payments $ 2,530.94 $ 628.86 $ - $ 2,637.14 Outstanding Principal * $194,861.93 $16,429.55 $ - $ 46,539.10 % of Portfolio 9.6% 0.8% 0.0% 2.3% File: DELINQUENCY REPORT (1 -98) 8-C Worksheet LOAN DELIQUENCIES Date: 8/25/98 8/25/98 CONTRACT FOR PRIVATE REDEVELOPMENT By and Between HOUSING AND REDEVELOPMENT, AUTHORITY In and For THE CITY OF FROLEY, MINNESOTA And GUY W. JORDAN AND CATHERINE S. JORDAN FOR PROPERTY LOCATED AT 540 HUGO STREET This document was drafted by: James R. Casserly, Esq. Krass Monroe, P.A. Suite 1100 Southpoint Office Center 1650 West 82nd Street Minneapolis, MN 55431 7n_9/9s El CONTRACT FOR PRIVATE REDEVELOPMENT THIS AGREEMENT, made as of the day of , 1998 by and between the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority "), a public body corporate and politic organized under the laws of the State of Minnesota and Guy W. Jordan and Catherine S. Jordan (the "Redeveloper'). WITNESSETH: . WHEREAS, the Board of Commissioners (the "Board ") of the Authority has determined that there is a need for development and redevelopment within the corporate limits of the City to provide employment opportunities, to provide adequate housing in the City, including low and moderate income housing and housing for the elderly, to improve the tax base and to improve the general economy of the City and the State of Minnesota; WHEREAS, in furtherance of these objectives, the *Authority has established, pursuant to Minnesota Statutes, Sections 469.001 et seq. (the "Act "), the redevelopment plan known as the Modified Redevelopment Plan for its Redevelopment Project No. 1 (the "Project Area ") which plan, as amended, and as it may be amended, is hereinafter referred to as the "Redevelopment Plan" in the City to .encourage and provide maximum opportunity for private development and redevelopment of certain property in the City which is not now in its highest and best use; WHEREAS, in order to achieve the objectives of the Redevelopment Plan and particularly to make specified land in the Project Area and in the Authority's area of operation available for development by private enterprise for and in accordance with the Redevelopment Plan, the Authority has determined to provide substantial aid and assistance to finance public development costs in the Project Area and in the Authority's area of operation; and WHEREAS, the Authority believes that the development and redevelopment of the Project Area pursuant to this Agreement, and fulfillment generally of the terms of this Agreement, are in the vital and best interests of the Authority and the health, safety, morals and welfare of its residents, and in accord with the public purposes and provisions of applicable federal, state and local laws under which the development and redevelopment are being undertaken and assisted; NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: ARTICLE I Definitions Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Act" means Minnesota Statutes, Sections 469.001, et seq. "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 Fridley, Minnesota. "Certificate of Completion" means the certification, in the form of the certificate contained in Schedule C attached to and made a part of.,this Agreement, provided to the Redeveloper, pursuant to Section 4.4 of this Agreement. "City" means the City of Fridley, Minnesota, or its successors or assigns. "Construction Plans" means the plans, specifications, drawings and related documents for the construction of the Minimum Improvements which are required by the _City for the issuance of its building permit and conform to the Housing Design and Site Development Criteria. "County" means the County of Anoka, Minnesota. "Date of Closing" means the date or dates set forth in Section 3.1(b). "Event of Default" means an action by the Redeveloper described in Section 7. Lof this Agreement. "Homeowner" means a person(s) who purchases the Project from the Redeveloper. "Housing Design and Site Development Criteria" mean the criteria and standards described in Schedule D attached to and made a part of this Agreement. "Minimum Improvements" means the improvements to be constructed by the Redeveloper on the Redevelopment Property as specified in the Construction Plans approved by the Authority. "Party" means a party to the Agreement. "Permitted Encumbrances" means those encumbrances as defined in Section 8.7 of this Agreement. "Project" means the Redevelopment Property and the Minimum Improvements. "Purchase Price" means the sum of $25,000.00. "Redeveloper" means Guy W. Jordan and Catherine S. Jordan. "Redevelopment Plan" means the Modified Redevelopment Plan adopted by the Authority in connection with its Redevelopment Project No. 1. "Redevelopment Property" means the real property upon which the Minimum Improvements are to be constructed, which real property is described on Schedule A of this Agreement. "Redevelopment Property Deed" means a quit claim deed, substantially in the form of the deed in Schedule B of this Agreement, used to convey the Redevelopment Property from the Authority to the Redeveloper. "Sales Price" means an amount equal to or greater than $110,000.00 and which is to be used on the certificate of real estate value when the Project is conveyed to the Homeowner. "State" means the State of Minnesota. "Unavoidable Delays" means delays which are the direct result of strikes or shortages of material; delays which are the direct result of casualties to the Minimum Improvements, the Redevelopment Property or the equipment used to construct the Minimum Improvements or, delays which are the direct result of governmental actions (except that the City may not create an Unavoidable Delay by virtue of its own action); delays which are the direct result of judicial action commenced by third parties; delays which are the direct result of citizen opposition- or action affecting this Agreement or adverse weather conditions or acts of God ARTICLE II Representations and Warranties Section 2.1. Representations by the Authority. The Authority represents and warrants that: K (a) The Authority is a public body duly organized and existing under the laws of the State. Under the provisions of the Act, the Authority has the power to enter into this Agreement and carry out its obligations hereunder. (b) The Authority will, in a timely manner, subject to all notification requirements, review and act upon all submittals and applications of the Developer and will cooperate with the efforts of Developer to secure the granting of any permit, license, or other approval required to allow the construction of the Improvements; provided, however, that nothing contained in this Section 2.1(b) shall be construed to limit in any way the reasonable and legitimate exercise of the Authority's discretion considering any submittal or application. _ (c) The Authority makes no representation, guarantee, or warranty, either express or implied, and hereby assumes no responsibility or liability as to the Redevelopment Property or its condition (regarding soils, pollutants, hazardous wastes or otherwise). Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper represents and warrants that: (a) The Redeveloper will purchase the Redevelopment Property from the Authority pursuant to Article III hereof and in the event the Redevelopment Property is conveyed to the Redeveloper, then the Redeveloper will construct the Minimum Improvements in accordance with the terms of this Agreement, the Redevelopment Program and all local, state and federal laws and regulations (including, but not limited to, environmental, zoning, building code and public health laws and regulations). (b) The Redeveloper are individuals. (c) The financing arrangements which the Redeveloper has obtained or will obtain to finance construction of the Minimum Improvements will be sufficient to enable the Redeveloper to successfully complete the Minimum Improvements as contemplated in this Agreement. (d) The Redeveloper shall prepare the Construction Plans and construct the Minimum Improvements in accordance with the Housing Design and Site Development Criteria. (e) The Redeveloper shall have the Construction Plans prepared by an architectural designer or an architect. (f) The Redeveloper shall sell the Project to the Homeowner for the Sales Price. 4 Y. ARTICLE III Convevance of Property Section 3.1. Conveyance of the Redevelopment Property. (a) Title. The Authority shall convey marketable title to and possession of the Redevelopment Property to the Redeveloper under a quit claim deed in the form of the Redevelopment Property Deed contained in Schedule B of this Agreement. The conveyance of title to the Redevelopment Property pursuant to the Redevelopment Property Deed and the Redeveloper's use of the Redevelopment Property shall be subject to all of the conditions, covenants, restrictions. and limitations imposed by this Agreement and the Redevelopment Property Deed. The Authroty agrees to obtain and shall deliver to the Redeveloper a commitment for an owner's title insurance policy (ALTA Form B -1970) issued by a title insurance company acceptable to the Authority and Redeveloper, naming Redeveloper as the proposed owner - insured of the Redevelopment Property in the amount of the Purchase Price (the "Commitment "). The Commitment shall have a current date as its effective date and shall commit to insure marketable title in Redeveloper, free and clear of all mechanics'. lien claims; questions of survey, unrecorded interests, rights of parties in possession or other exceptions. The Commitment shall set forth all levied real estate and special assessments. Said commitment shall have attached copies of all instruments of record which create any easements or restrictions which are referred to in Schedule B of the title commitment. Redeveloper will be allowed 20 days after receipt of the Commitment to make an examination thereof and to make any objections to the marketability of the title to Redevelopment Property, said objections to be made by written notice or to be deemed waived. If the title to the Redevelopment Property, as evidenced by the Commitment, together with any appropriate endorsements, is not good and marketable of record in the City and is not made so by the Date of Closing, Redeveloper may either: (i) Terminate this Agreement by giving written notice to the Authority in which event this Agreement shall become null and void and neither parry shall have any further rights or obligations hereunder, or (ii) Elect to accept the title in its marketable condition by giving written notice to the Authority, in which event the Redeveloper shall hold back adequate funds from the portion of the Purchase Price payable at the closing to cure the defects and apply said holdback funds of the cost of curing such defects, including attorneys' fees, and pay the unexpected balance to the Authority. (If the amount of said holdback cannot be mutually agreed to by the Authority and the Redeveloper, the issuer of the Commitment shall determine the amount of said holdback.) 5 (b) Time of Conveyance. The Authority shall execute and deliver to the Redeveloper the Redevelopment Property Deed for the Redevelopment Property on September 1, 1998 or on such date as the Authority and the Redeveloper shall mutually agree in writing (the "Date of Closing "). The Redeveloper shall take possession of the Redevelopment Property on the Date of Closing. (c) Price and Payment. The Authority agrees to sell and the Redeveloper agrees to purchase the Redevelopment Property for the Purchase Price. Unless otherwise mutually agreed by the Authority and the Redeveloper, the execution and delivery of all deeds and the payment of the Purchase Price shall be made at the principal offices of the Authority. The Purchase Price to be paid by the Redeveloper for the conveyance of the Redevelopment Property from the Authority to the Redeveloper shall be paid in cleared funds. The Redevelopment Property Deed shall be in recordable form and shall be promptly recorded. The Redeveloper shall pay all costs for such recording.. (d) Taxes and Special Assessments. Real estate taxes due and payable prior to the year of closing shall be paid by the Authority. Real estate takes due and payable in the year of closing shall be prorated as of the Date of Closing based upon the parties' respective period of ownership in the year of closing. Real estate taxes due and payable in the years subsequent to the closing shall be paid by the Redeveloper. On or prior to the Date of Closing, the Authority shall pay all pending or levied special assessments. (e) Survey. The Authority will not provide a survey. (f) Inspection. At Redeveloper's expense, Redeveloper, its agents and designees, are hereby granted the right at any time or times after the date hereof to inspect, analyze, and test the Redevelopment Property. Redeveloper shall hold the Authority and the City harmless from any liability resulting solely from the entering upon the Redevelopment Property or the performing of any of the tests or inspections referred to in this Section by Redeveloper, its agents or designees. Section 3.2. Conditions Precedent to Conveyance. The obligations of the Authority to convey the Redevelopment Property to the Redeveloper shall be subject to the following conditions precedent: (a) ' On the Date of Closing, the Redeveloper shall be in material compliance with all of the terms and provisions of this Agreement; (b) The Redeveloper shall have provided evidence satisfactory to the Authority that'- it is capable of financing or has obtained financing or a commitment for financing sufficient to finance the construction of the Minimum Improvements for the Redevelopment Property. The Redeveloper will be deemed to have provided adequate evidence of such financial commitment 0 and ability if the Redeveloper provides evidence satisfactory to the Authority of a mortgage commitment; (c) The Authority and the City shall have approved the Construction Plans. (d) The Redeveloper shall have received the appropriate permits for the construction of the Minimum Improvements; (e) The Redeveloper shall have paid the Purchase Price. (f) The Redeveloper shall provide documents showing that it has a binding legal commitment for the resale of the Project to the Homeowner for the Sales Price. ARTICLE IV - Construction of Minimum 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 this Agreement, the Housing Design and Site Development Criteria and the Construction Plans approved by the City and the Authority and will maintain, preserve and keep the Minimum Improvements or cause. the Minimum in good repair and condition until sale of the Project to the Homeowner. Subject to Unavoidable Delays, the Redeveloper shall commence construction of the Minimum Improvements on or before November 15, 1998. Section 4.2. Completion of Construction. (a) Subject to Unavoidable Delays, the Redeveloper shall have substantially completed the construction of the Minimum Improvements by June 15, 1999. All work with respect to the Minimum Improvements to be constructed or provided by the Redeveloper on the Redevelopment Property shall be in conformity with the Construction Plans as submitted by the Redeveloper and approved by the City and Authority. (b) The Redeveloper agrees for itself, its successors and assigns, and every successor in interest to the Redevelopment Property, or any part thereof, and the Redevelopment Property Deed shall reference the covenants contained in this Section 4.2 and Section 7.3 of this Agreement, that the Redeveloper, and its successors and assigns, shall promptly begin and diligently prosecute to completion the redevelopment of the Redevelopment Property through the construction of the Minimum Improvements thereon, and that such construction shall in.any event be completed within the period specified in this Section 4.2. 7 Section 4.3. Certificate of Completion. (a) Promptly after completion of the Minimum Improvements'in accordance with the provisions of this Agreement relating to the obligations of the Redeveloper to construct such improvements (including the date for completion thereof), the Authority will fumish the Redeveloper with a Certificate of Completion. The Certificate of Completion shall be a conclusive determination and conclusive evidence of the satisfaction and termination of the agreements and covenants in this Agreement and in the Redevelopment Property Deed with respect to the obligations of the Redeveloper and its successors and assigns, to construct the Minimum Improvements and the date for the completion thereof. (b) If the Authority shall refuse or fail to provide the Certificate of Completion in accordance with the provisions of this Section 4.3 the Authority shall, within twenty (20) days after written request by the Redeveloper, provide the Redeveloper with a written statement, indicating in adequate detail in what respects the Redeveloper has failed to complete the Minimum Improvements in accordance with the provisions of this Agreement, or is otherwise in default, and what measures or acts will be necessary, in the opinion of the Authority, for the Redeveloper to take or perform in order to obtain a Certificate of Completion. (c) The construction of the Minimum Improvements shall be deemed to be completed when the City has issued its Certificate of Occupancy. ARTICLE V Real Property Taxes and Insurance Section 5.1. Real Property Taxes. Prior to the Authority issuing its Certificate of Completion, the Redeveloper shall pay when due, prior to the attachment of penalty, all real property taxes payable with respect to the Redevelopment Property in the years subsequent to the delivery of the Redevelopment Property Deed. Section 5.2. Insurance. (a) The Redeveloper will provide and maintain 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. The interest of the Authority shall be protected in accordance with a clause in form and content reasonably satisfactory to the Authority; 8 (ii) comprehensive general 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); and (iii) workers' compensation insurance, with statutory coverage. (b) All insurance required in Article V of this Agreement shall be taken out and maintained in responsible insurance companies selected by the Redeveloper which are authorized under the laws of the State to assume the risks covered thereby. The Redeveloper will deposit annually with the Authority policies evidencing all such insurance, or a certificate or certificates or binders of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Article V of this Agreement each policy shall contain a provision that the insurer shall not cancel nor modify it without giving written notice to the Redeveloper and the Authority at least thirty (30) days before the cancellation or modification becomes effective. ARTICLE VI Prohibitions Against Assignment and Transfer; Indemnification Section 6.1. Representation as to Redevelopment. The Redeveloper represents and agrees that its purchase of the Redevelopment Property, and its other undertakings pursuant to this Agreement, are, and will be used, for the purpose of redevelopment of the Redevelopment Property and not for speculation in land holding. The Redeveloper further recognizes that, in view of (a) the importance of the redevelopment of the Redevelopment Property to the general welfare of the Authority; (b) the substantial financing and other public aids that have been made available by the Authority for the purpose of making such redevelopment possible; and (c) the fact that any act or transaction involving or resulting in a significant change in the identity of the parties in control of the Redeveloper or'the degree of their control is for practical purposes a transfer or disposition of the property then owned by the Redeveloper, the qualifications and identity of the Redeveloper are of particular concern to the Authority. The Redeveloper further recognizes that it is because of such qualifications and identity that the Authority is entering into this Agreement with the Redeveloper, and, in so doing, is further Killing to accept and rely on the obligations of the Redeveloper for the faithful performance of all undertakings and covenants hereby by it to be performed. Section 6.2. Prohibition Against Transfer of Property and Assignment of Agreement. Also, for the foregoing reasons the Redeveloper represents and agrees that prior to the earlier of the issuance of the Certificate of Completion or the Termination Date. Except 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 9 the Minimum Improvements under this Agreement, and any other purpose authorized by this Agreement, the Redeveloper has not made or created and will not make or create or suffer to be made or created any total or partial sale, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to this Agreement or the Redevelopment Property or any part thereof or any interest therein, or any contract or agreement to do any of the same, without the prior written approval of the Authority. Notwithstanding the foregoing, the Redeveloper may transfer the Redevelopment Property to a Homeowner. Section 63. Release and Indemnification Covenants. (a) The Redeveloper covenants and agrees that the City and 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 City and 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, except for any loss resulting from negligent, willful or wanton misconduct of any such parties, and provided that the claim therefore is based upon the acts of Redeveloper or of others acting on the behalf or -under the direction or control of Redeveloper. (b) Except for any negligent or willful misrepresentation or any negligent, willful or wanton misconduct of the following. named parties, the Redeveloper agrees to protect and defend the City, the Authority 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 Minimum Improvements, except for the use of eminent domain if exercised by the Authority to acquire the Redevelopment Property, and provided that the claim therefore is based upon the acts of Redeveloper or of others acting on the behalf or under the direction or control of Redeveloper. (c) The City and the Authority and the governing body members, officers, agents, servants and employees thereof shall not be liable for any damage or injury to the persons or property of the Redeveloper or its officers, agents, servants or employees or any other person who may be about the Redevelopment Property or Minimum Improvements due to any act of negligence of any person, other than the negligence and misconduct of City or Authority employees or those employed or engaged by the City or Authority. (d) All covenants, stipulations, promises, agreements and obligations of the Authority contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Authority and not of any governing body member, officer, agent, servant or employee of the Authority in the individual capacity thereof. 10 (e) Nothing in this section or this Agreement is intended to waive any municipal liability limitations contained in Minnesota Statutes, particularly Chapter 466. ARTICLE VII Events of Default Section 7.1. Events of Default Defined. Subject to Unavoidable Delays, 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 (unless the context otherwise provides), any one or more of the following events: (a) Failure by . the Redeveloper to pay when due all real property taxes assessed against the Redevelopment Property. (b) Failure by the Redeveloper to commence or complete construction of the Minimum Improvements pursuant to the terms, conditions and limitations of Article IV of this Agreement. (c) Failure by the Redeveloper to substantially observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed hereunder. _ (d) The Redeveloper shall: (i) file any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under the United States Bankruptcy Code or under any similar federal or state law; or (ii) make an assignment for the benefit of its creditors; or (iii) admit in writing its inability to pay its debts generally as they become due; or (iv) be adjudicated as bankrupt or insolvent; or if a petition or answe* r proposing the adjudication of the Redeveloper as a bankrupt or its reorganization under any present or future federal bankruptcy act or any similar federal 'or State law shall be filed in any court and such petition or answer shall not be discharged or denied within ninety (90) days after the filing thereof; or a receiver, trustee or liquidator of the Redeveloper or of the Redevelopment Property, or part thereof shall be appointed in any proceeding brought against the Redeveloper and shall not be discharged within ninety, (90) days after such appointment, or if the Redeveloper shall consent to or acquiesce in. such appointment. 11 Section 7.2. Remedies on Default. Whenever any Event of Default referred to in Section 7.1. of this Agreement occurs, the Authority may take any one or more of the following actions after providing thirty days' written notice to the Redeveloper of the Event of Default, but only if the Event of Default has not been cured within said thirty days, or if the Event of Default is by its nature incurable within said thirty day period, and the Redeveloper fails to provide the Authority with written assurances, deemed satisfactory in the reasonable discretion of the Authority, that the Event of Default will be cured as soon as reasonably possible: (a) Suspend its performance under this Agreement until it receives assurances from the Redeveloper, deemed adequate by the Authority, that the Redeveloper will cure its default and continue its performance under this Agreement. (b) Terminate this Agreement. (c) Withhold the Certificate of Completion. (d) Take whatever action, including legal, equitable or administrative action, which may appear necessary or desirable to the Authority, including any actions to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant of the Redeveloper under this Agreement. Section 7.3. Revesting Title in Authority Upon Happening of Event Subseguent to Conveyance to Redeveloper. In the event that subsequent to conveyance of the Redevelopment Property to the Redeveloper and prior to the receipt by the Redeveloper of the Certificate of Completion: (a) subject to Unavoidable Delays, the Redeveloper fails to carry out its obligations with respect to the construction of the Minimum Improvements (including the nature and the date for the commencement and completion thereof), or abandons or substantially suspends construction work, and any such failure, abandonment, or suspension shall not be cured, ended, remedied or assurances reasonably satisfactory to the Authority made within thirty (30) days after written demand from the Authority to the Redeveloper to do so; or (b) the Redeveloper fails to pay real estate taxes or assessments on the Redevelopment Property or any part thereof when due, or creates, suffers, assumes, or agrees to any encumbrance or lien on the Redevelopment Property which is unauthorized by this Agreement or shall suffer any levy or attachment to be made, or any materialmen's or mechanics' lien, or any other unauthorized encumbrance or lien to attach, and such taxes or assessments shall not have been paid, or the encumbrance or lien removed or discharged or provision reasonably satisfactory to the Authority made for such payment, removal, or discharge, within thirty (30) days after written demand by the Authority to do so; provided, that if the Redeveloper shall first notify the Authority 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 Authority shall permit such mechanics' or other lien to remain undischarged and 12 unsatisfied during the period of such contest and any appeal, but only if the Redeveloper provides the Authority with a bank letter of credit or other security in the amount of the lien, in a form satisfactory to the Authority pursuant to which the bank or other obligor will pay to the Authority the amount of any lien in the event that the lien is finally determined to be valid. During the course of such contest the Redeveloper shall keep the Authority informed respecting the status of such defense; or (c) there is, in violation of this Agreement, any transfer of the Redevelopment Property or any part thereof, or any change in the ownership or distribution thereof of the Redeveloper, or with respect to the identity of the parties in control of the Redeveloper or the degree thereof, and such violation shall not be cured within thirty (30) days after written demand by the Authority to the Redeveloper, Then the Authority shall have the right to re -enter and take possession of the Redevelopment Property and to terminate (and revest in the Authority) the estate conveyed by the Redevelopment Property Deed to the Redeveloper, it being the intent of this provision, together with other provisions of the Agreement, that the conveyancetof the Redevelopment Property to the Redeveloper shall be made upon, and that the Redevelopment Property Deed shall contain a condition subsequent to the effect that in the event of any default on the part of the Redeveloper and failure on the part of the Redeveloper to remedy, end, or abrogate such default within the period and in the manner stated in such subdivisions, the Authority at its option may declare a termination in favor of the Authority of the title, and of all the rights and interests in and to the Redevelopment - Property conveyed to the Redeveloper, and that such title and all rights_ and interests of the Redeveloper, and any assigns or successors in interest to and in the Redevelopment Property, shall revert to the Authority, but only if the events stated in Section 73(a) -(c) have not been cured within the time periods provided above. Notwithstanding anything to the contrary contained in this Section 7.3 of this Agreement, the Authority shall have no right to re -enter or retake title to and possession of any part of ,the Redevelopment Property for which a Certificate of Completion has been issued. Section 7.4. Resale of Reacquired Property; Disposition of Proceeds. Upon the revesting in the Authority of title to any parcel of the Redevelopment Property or any part thereof as provided in Section 7.3, the Authority shall have no further responsibility to the Redeveloper hereunder with respect to that or any subsequent parcel and may sell or otherwise devote said parcels to such other uses as the Authority shall in its sole discretion determine, without reimbursement of any sums paid by the Redeveloper to the Authority under this Agreement. Section 7.5. No Remedv Exclusive. No remedy herein conferred upon or reserved to the Authority or Redeveloper is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law, or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or 13 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 VII. Section 7.6. 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 7.7. Agreement to Pay Attorney's Fees and Expenses. Whenever any Event of Default occurs and the City shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement or performance or observance of any obligation or agreement on the part of the Redeveloper under this Agreement, the Redeveloper agrees that it shall, - within ten (10) days of written demand by the Authority, pay to the Authority the reasonable fees of such attorneys and such other expenses so incurred by the Authority. ARTICLE VIII Mortgage Financing Section 8.1. Limitation Upon Encumbrances of Property. Prior to the substantial 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, other than Permitted Encumbrances, whether by express agreement or operation of law, or suffer any encumbrance or lien to be made on or attach to the Redevelopment Property, other than Permitted Encumbrances, except: (a) For the purposes of obtaining funds only to the extent necessary for financing of the Minimum Improvements including, but not limited to, labor and materials, equipment, professional fees, real estate taxes, construction interest, organizational and other indirect costs of development, costs of constructing the Minimum Improvements, an allowance for. contingencies, acquisition cost of the Redevelopment Property, costs of originating the Mortgage and customary financing costs. (b) Only upon the prior written approval of the Authority in accordance with Sections 8.1 and 8.2. The Authority shall not approve any Mortgage which does not contain terms that conform to the terms of Section 8.5, except as provided in Section 8.6 of this Agreement. 14 Section 8.2 Approval of Mortgage. The Authority shall approve a Mortgage if (a) The Authority first receives a copy of all Mortgage documents. (b) The Mortgage loans, together with other funds available to the Redeveloper, will, in the reasonable judgment of the Authority, be sufficient to acquire the Redevelopment Property, to pay for the Site Improvements and construct the Minimum Improvements. (c) The Authority is not entitled under Section 7.2 to exercise any of the remedies set forth therein as a result of an Event of Default. (d) The Authority determines that the terms of the Mortgage conform to the terms of Section 8.5. However, the approval of a Mortgage by the Authority shall not be unreasonably withheld. Any Mortgage which is subordinated to the rights of the Authority under this Agreement may be granted in all or any part of the Redevelopment Property without the approval of the Authority. Section 8.3 Notice of Default; Copy to Mortgagee. Whenever the Authority shall deliver any notice or demand to the Redeveloper with respect to any breach or default by the Redeveloper in its obligations or covenants under this Agreement, the Authority shall at the same time forward a copy of such notice or demand to each Holder of any Mortgage authorized by this Agreement at the last address of such Holder shown in the records of the Authority. Section 8.4 Mortgagee's Option to Cure Defaults. After any breach or default referred to in Section 8.3, each such Holder shall (insofar as the rights of the Authority are concerned) have the right, at its option, to cure or remedy such breach or default (or such breach or default to the extent that it relates to the part of the Redevelopment Property covered by its Mortgage) and to add the cost thereof to the Mortgage debt and the lien of its Mortgage; provided, however, that if the breach or default is with respect to construction ' of the Minimum Improvements, nothing contained in this Section or any other Section of this Agreement shall be deemed to require such Holder, either before or after foreclosure or action in lieu thereof, to undertake or continue the construction or completion of the Minimum Improvements, provided that any such Holder shall not devote the Redevelopment Property to a use inconsistent with the Redevelopment Plan or this Agreement without the agreement of the Authority. Section 8.5 Authority's Option to Cure Default on Mortgage. Any Mortgage, unless such requirement is waived by the Authority, executed by the Redeveloper with respect to the Redevelopment Property or any improvements thereon shall provide that, in the event that the Redeveloper is in default under any Mortgage authorized pursuant to this Article VIII, the Holder shall notify the Authority in writing of 15 (a) The fact of the default. (b) The elements of the default. (c) The actions required to cure the default. If the default is an "Event of Default" under such Mortgage, which shall entitle such Holder to foreclose upon the Redevelopment Property, the Minimum Improvements or any portion thereof, and any applicable grace periods have expired, the Authority shall have, and each Mortgage executed by the Redeveloper with respect to the Redevelopment Property or any improvements thereon shall provide that the Authority shall have such an opportunity to cure the "Event of Default" within such reasonable time period as the Holder shall deem appropriate. Section 8.6 Subordination and Modification for the Benefit of Mort�a�ees. In order to facilitate the obtaining of financing for the construction of the Minimum Improvements, the Authority agrees that it shall agree to any reasonable modification of this Article VIII or waiver of its rights hereunder to accommodate the interests of the Holder of a Mortgage, provided, however, that the Authority determines, in its reasonable judgment, that any such modification(s) will adequately protect the legitimate interest and security of the Authority with respect to the Redevelopment Property. Section ' 8.7 Permitted Encumbrances. The following shall. be permitted encumbrances on the title to the Redevelopment Property: (a) Such encumbrances as are mutually agreed to in writing by the Authority and the Redeveloper. (b) Governmental regulations, if any affecting the use and occupancy of the. Redevelopment Property and Minimum Improvements. (c) Zoning laws of the City, County and State. (d) All rights in public highways upon the land. (e) Reservations to the State, in trust for the tax districts concerned, of minerals and mineral rights in those portions of the Redevelopment Property the title to which may have at any time heretofore been forfeited to the State for nonpayment of real estate taxes. (f) The lien of unpaid special assessments, if any, not presently payable but to be paid as a part of the annual taxes to become due. 16 (g) The lien of unpaid real estate taxes, if any not presently payable but to be paid as a part of the annual taxes to become due. (h) A Mortgage as permitted under Section 8.2 ARTICLE IX Additional Provisions Section 9.1. Conflict of Interest; Authority Representatives Not Individually Liable. No member, official, or employee of the Authority shall have any personal interest, direct or indirect, in this Agreement, nor shall any such member, official, or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership, or association in which he is, directly or indirectly, interested. No member, official, or employee of the Authority shall be personally liable to the Redeveloper, or any successor in interest, in the event of any default or breach by the Authority or for any amount which may become due to the Redeveloper or successor or on any obligations under the terms of this Agreement, except in the'case of willful misconduct. Section 9.2. Equal Emplovment Opportunity. The Redeveloper, for itself and its successors and assigns, agrees that during the construction of the Minimum Improvements provided for in this Agreement that it will comply with all applicable equal employment opportunity and non - discrimination laws, ordinances and regulations. Section 93. 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 9.4. Titles of Articles and Sections. Any titles of the several parts, articles, and sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 9.5. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under this Agreement by either parry to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, transmitted by facsimile, delivered by a recognized overnight courier or delivered personally; and (a) in the case of the Redeveloper, is addressed to or delivered personally to the Redeveloper at 6540 East River Road, -224, Fridley, Minnesota, 55432, Attention: Guy W. Jordan and Catherine S. Jordan; 17 (b) in the case of the Authority, is addressed to or delivered personally to the Housing and Redevelopment Authority in and for the City of Fridley at 6431 University Avenue Northeast, Fridley, Minnesota, 55432, Attention: City Manager, or at such other address with respect to either party as that party may, from time to time, designate in writing and forward to the other as provided in this Section. Section 9.6. Counterparts. This agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 9.7 Termination. This Agreement shall terminate upon the Authority issuing its Certificate of Completion or in accordance with the provisions of Article VIII and the discharge of all of the Authority's and Redeveloper's other respective obligations hereunder, but no such termination shall terminate any indemnification or other rights or remedies arising hereunder due to any Event of Default which occurred and was continuing prior to such termination. 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 on or as of the date first above written. 18 Dated: HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA Its Chairman And by Its Executive Director STATE OF MINNESOTA ) ' ) ss. COUNTY OF ANOKA ) On this day of , 1998 before me, a notary public within and for Anoka County, • personally appeared and to me personally known who by me duly sworn, did say that they are the Chairman and Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, a public body corporate and politic organized under the laws of the State of Minnesota, and acknowledged the foregoing instrument on behalf of said Authority. Notary Public Authority Signature Page -- Redevelopment Contract 19 Dated: Guy W. Jordan Catherine S. Jordan STATE OF NUNNESOTA ) ' ) ss. COUNTY OF ANOKA ) On this day of ,1998 before me, a notary public within and for County, personally appeared Guy W. Jordan and Catherine S. Jordan, to me known to be the persons described in and who executed the foregoing instrument and acknowledged that they executed the same as their free act and deed. Notary Public Redeveloper Signature Page -- Contract for Private Redevelopment G:% VVPDATA\AMDL.EYVSVORDANIDOCSOEV AGR.DOC 20 SCHEDULE A DESCRIPTION OF REDEVELOPMENT PROPERTY Lots 47 and 48, Block "H" Riverview Heights, Anoka County, Minnesota, according to the plat thereof on file and of record in the office of the Register of Deeds in and for said County and State Lots Forty-nine (49) and. Fifty (50), Block "H ", Riverview Heights, Anoka County, Minnesota, according to the plat thereof on file and of record in the office of the Register of Deeds in and for said County and State. 21 SCHEDULE B REDEVELOPMENT PROPERTY DEED THIS INDENTURE, made this day of , 1998, between the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, a body corporate and politic under the laws of the State of Minnesota (the "Grantor "), and Guy W. Jordan and Catherine S. Jordan (the "Grantee "). WITNESSETH, that Grantor, in consideration of the sum of One Dollar ($1.00) and other good and valuable consideration the receipt whereof is hereby acknowledged, does hereby convey and quit claim to the Grantee, its successors and assigns forever, all the tract or parcel of land lying and.being in the County of Anoka and State of Minnesota described as follows: See Exhibit 1 Attached together with all hereditament and appurtenances belonging thereto, Grantor covenants and represents that: Grantee has committed to construct certain improvements and Grantor has a right of re- entry in accordance with Sections 4.2 and 7.3 respectively of the Contract for Private Redevelopment By and Between the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota and Guy W. Jordan and Catherine S. Jordan dated ,19 . The completion of the improvements and the release of the right of re -entry shall be evidenced by the recording of the Certificate of Completion and Release of Forfeiture attached as Exhibit 2 to this deed. - The Grantor certifies that the Grantor does not know of any wells on described real property. IN WITNESS WHEREOF, the Grantor has caused this deed to be duly executed in its behalf by its Chairman and its Executive Director the day an year written above. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA By Its Chairman And by Its Executive Director STATE OF MINNESOTA ) ss. COUNTY OF ANOKA ) On this day of , 199_ before me, a notary public within and for Anoka County, personally appeared and to me personally known who by me duly sworn, did say that they are the Chairman and Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, a body corporate and politic under the laws of the State of Minnesota, and acknowledged the foregoing instrument on behalf of said Authority. This instrument was drafted by: James R. Casserly, Esq. Krass Monroe, P.A. Suite 1100 Southpoint Office Center 1650 West 82nd Street Minneapolis, MN 55431 (612) 885 -1296 Notary Public 23 SCHEDULE C CERTIFICATE OF COMPLETION AND RELEASE OF FORFEITURE WHEREAS, the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, a body corporate and politic under the laws of the State of Minnesota (the "Grantor "), by a Deed recorded in the Office of the County Recorder or the Registrar of Titles in and for the County of Anoka and State of Minnesota, as Deed Document Number(s) and , respectively, has conveyed to Guy W. Jordan and Catherine S. Jordan (the "Grantee "), the following described land in County of Anoka and State of Minnesota, to -wit: See Exhibit 1 Attached WHEREAS, said Deed contained certain covenants and restrictions, -the breach of which by Grantee, its successors and assigns, would result in a forfeiture and right of re -entry by Grantor, its successors and assigns, said covenants and restrictions being set forth in said Deed; and WHEREAS, said Grantee has performed said covenants and conditions insofar as it is able in a manner deemed sufficient by the Grantor to permit the execution and recording of this certification; NOW, THEREFORE, this is to certify that all building construction and other physical improvements specified to be done and made by the Grantee have been completed and the above covenants and conditions in said Deed have been performed by the Grantee therein and that the provisions for forfeiture of title and right to re -entry for breach of condition subsequent by the Grantor therein is hereby released absolutely and forever insofar is it applies to the land described herein, and the County Recorder or the Registrar of Titles in and for the County of Anoka and State of Minnesota is hereby authorized to accept for recording and to record this instrument, and the filing of this instrument shall be a conclusive determination of the satisfactory termination of the covenants and conditions of the contract referred to in said Deed, the breach of which would result in a forfeiture and right of re -entry. 24 Dated: , 199 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA �0 Its Chairman And by Its Executive Director STATE OF MINNESOTA ) ss. COUNTY OF ANOKA ) On this day of , 199_ before me, a notary public within and for Anoka County, personally appeared and to me personally known who by me duly sworn, did say that they are the Chairman and Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, a body corporate and politic under the laws of the State of Minnesota, and acknowledged the foregoing instrument on behalf of said Authority. Notary Public 41 i r LEGAL DESCRIPTION OF REDEVELOPMENT PROPERTY 26 SCHEDULE D HOUSING DESIGN AND SITE DEVELOPMENT CRITERIA The Housing Replacement Program is a new construction program. For purposes of this program "new construction" means conventional, on -site, stick -built construction. Moved -in homes or manufactured housing (e.g. mobile homes) are not acceptable. The homes must be constructed according to applicable building and zoning codes. In addition, all homes shall conform to the design guidelines described below. The guidelines have been created so that the new homes enhance the appearance of the neighborhood., It should be emphasized that these are minimum standards. Staff shall review all building, grading and drainage plans prior to HRA approval. 1. Only single - family, detached dwellings, may be constructed. A covered entry to the dwelling is desirable. 2. A minimum of two bedrooms are required (on the same floor). Three and four bedroom homes are desirable. 3. A minimum of one full bath and one -half bath is required. 4. A two (2) car attached garage is required. A hard surfaced driveway (asphalt or concrete) is required. 5. Exterior materials should be low maintenance, such as steel, vinyl or aluminum siding. Cedar siding is also acceptable. Brick facing and other architectural ornamentation is desirable. Hardboard siding is not acceptable. 6. The house building lines, roof lines, door and window placement shall be used to minimize blank wall mass, and orientation to the street must present a balanced and pleasing view from all sides. 7. All sites be fully landscaped upon completion of the project and should include both sod installation and placement of plants and shrubs. Existing trees shall be preserved whenever possible. Care should be taken to preserve existing root systems. A tree wrap, with board reinforcement shall be used on trees directly adjacent to active grading and construction. 8. Utility meters shall be screened from street view; locations must be specified on plans. All air conditioning units must be located in the rear yard or screened in the side -yard. 9. Designs which emphasize front porches, covered entries, brick facing, architectural ornamentation or unique garage orientation are strongly encouraged. 27 � . Draft: 8/14/98 CONTRACT FOR PRIVATE REDEVELOPMENT By and Between THE HOUSING AND REDEVELOPMENT AUTHORITY In and For THE CITY OF FRIDLEY, MINNESOTA And CINTAS CORPORATION NO. 1 This Instrument Drafted By: KRASS MONROE, P.A. (JRC) Suite 1100 Southpoint Office Center 1650 West 82nd Street Bloomington, MN 55431 612/885 -5999 G:\ WFDATA \F \FRIDLEY \06 \DOCS \COVER.DOC TABLE OF CONTENTS Page ARTICLE I Definitions Section 1.1. Definitions 3 ARTICLE II Representations and Warranties Section 2.1. Representations by the Authority 6 Section 2.2. Representations and Warranties by the Redeveloper 6 ARTICLE III Site Improvements; Undertakings of Authority and Redeveloper Section 3.1. Construction of Site Improvements . 9 Section 3.2. Reimbursement for Site Improvements 9 ARTICLE IV Construction of Minimum Improvements Section 4.1. Construction of Minimum Improvements 10 Section 4.2. Construction Plans 10 Section 4.3. Completion of Construction 1 I Section 4.4.. Certificate of Completion 11 ARTICLE V Tax Increment Section 5.1. Tax Increment Certification 12 ARTICLE VI Prohibitions Against Assignment and Transfer; Indemnification Section 6.1. Representation as to Redevelopment 13 Section 6.2. Prohibition Against Transfer of Property and Assignment of Agreement 13 Section 6.3. Release and Indemnification Covenants 13 ARTICLE VII Events of Default Section 7.1. Events of Default Defined 15 Section 7.2 Events of Default Subsequent to 17 Section 8.2. Certificate of Completion 16 Section 7.3. Remedies on Default 16 Section 7.4. No Remedy Exclusive 16 Section 7.5. No Additional Waiver Implied by One Waiver 16 Section 7.6. Agreement to Pay Attorney's Fees 18 and Expenses 16 ARTICLE VIII Additional Provisions Section 8.1. Conflict of Interest; Authority Representatives Not Individually Liable 17 Section 8.2. Equal Employment Opportunity 17 Section 8.3. Titles of Articles and Sections 17 Section 8.4. Notices and Demands 17 Section 8.5. Counterparts 18 Section 8.6. Time of the Essence 18 ARTICLE IX Termination of Agreement; Expiration Section 9.1. Termination 19 Section 9.2. Sections to Survive Termination 19 SIGNATURES SCHEDULE A SCHEDULE B SCHEDULE C SCHEDULE D SCHEDULE E SCHEDULE F Description of Redevelopment Property Certificate of Completion Note Site Improvements Minnesota Business Assistance Form Site Plan G:\ WPDATA \F \FRIDLEY \06 \DOCS \TOC.DOC 20 22 23 26 32 33 34 CONTRACT FOR PRIVATE REDEVELOPMENT THIS AGREEMENT, made on or as of the day of , 1999 by and between the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority "), a political subdivision of the State of Minnesota organized under the Constitution and laws of the State of Minnesota and Cintas Corporation No. 1, a corporation organized under the laws of the State of Ohio (the "Redeveloper "), WITNESSETH: WHEREAS, the Board of Commissioners (the "Board ") of the Authority has determined that there is a need for development and redevelopment within the corporate limits of the City to provide employment opportunities, to improve the tax base and to improve the general economy of the City and the State of Minnesota; WHEREAS, in furtherance of these objectives, the Authority has adopted, pursuant to Minnesota Statutes, Sections 469.001 et M. (the "Act "), a development program known as the Modified Redevelopment Plan (the "Redevelopment Plan ") and established Redevelopment Project No. 1 (the "Project Area ") in the City to encourage and provide maximum opportunity for private development and redevelopment of certain property in the City which is not now in its highest and best use; WHEREAS, major objectives in establishing the Project Area are to: 1. Promote and secure the prompt redevelopment of certain property in the Project Area, which property is not now in its highest and best use in a manner consistent with the City's Comprehensive Plan and with a minimum adverse impact on the environment, and thereby promote and secure the redevelopment of other land in the City. 2. Provide additional employment opportunities within the Project Area and the City for residents of the City and the surrounding area, thereby improving living standards, reducing unemployment and the loss of skilled and unskilled labor and other human resources in the City. 3. Prevent the deterioration and secure the increase of commercial/industrial property subject to taxation by the City, the Independent School Districts, Anoka County, and the other taxing jurisdictions in order to better enable such entities to pay for governmental services and programs required to be provided by them. 4. Provide for the financing and construction for public improvements in and adjacent to the Project Area necessary for the orderly and beneficial redevelopment of the Project Area and adjacent areas of the City. 5. Promote the concentration of new desirable industrial, office, and other appropriate redevelopment in the Project Area so as to maintain the area in a manner compatible with its accessibility and prominence in the City. 6. Encourage local business expansion, improvement, and redevelopment, whenever possible. 7. Create a desirable and unique character within the Project Area through quality land use alternatives and design quality in new or remodeled buildings. 8. Encourage and provide maximum opportunity for private redevelopment of existing areas and structures which are compatible with the Project Area; and WHEREAS, in order to achieve the objectives of the Authority and City in creating the Project Area the Authority is prepared to assist the Redeveloper with the costs of the Site Improvements in accordance with this Agreement; and WHEREAS, the Authority believes that the development and redevelopment of the Redevelopment Property pursuant to this Agreement, and fulfillment generally of the terms of this Agreement, are in the vital and best interests of the Authority and the health, safety, morals and welfare of its residents, and in accord with the public purposes and provisions of applicable federal, state and local laws under which the development and redevelopment are being undertaken and assisted; NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: -2- ARTICLE I Definitions Section I.I. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Act" means Minnesota Statutes, Sections 469.001 et seq. "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 Fridley, Minnesota. "Available Tax Increment" means 90% of the Tax Increment. "Certificate of Completion" means the certification, in the form of the certificate contained in Schedule B attached to and made a part of this Agreement, provided to the Redeveloper, pursuant to Section 4.4. of this Agreement. "City" means the City of Fridley, Minnesota. "Construction Plans" means the plans, specifications, drawings and related documents on the construction work to be performed by the Redeveloper on the Redevelopment Property which (a) shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the building official of the City, with an application for a building permit for the Minimum Improvements and (b) shall include at least the following for each building: (1) site plan; (2) foundation plan; (3) floor plan for each floor; (4) elevations (all sides); (5) facade and landscape plan; and (6) such other plans or supplements to the foregoing plans as the City may reasonably request. "Council" means the City Council, the governing body of the City. "County" means the County of Anoka, Minnesota. "Event of Default" means any Event of Default described in Section 7.1 of this Agreement. "Minimum Improvements" means the improvements to the Redevelopment Property to be constructed by the Redeveloper and shall consist of the construction of an office /warehouse /processing facility consisting of approximately 51,000 square feet and shall lc11 include landscaping, parking and related facilities. The Minimum Improvements are shown on the Site Plan attached as Schedule F to this Agreement. "Minnesota Critical Areas Act" means the statutes located at Minnesota Statutes, Section 116G.01 et seq., as amended. "Minnesota Environmental Policy Act" means the statutes located at Minnesota Statutes, Sections 116D.01 et seq., as amended. "Minnesota Environmental Rights Act" means the statutes located at Minnesota Statutes, Sections 116B.01 et seq., as amended. "National Environmental Policy Act" means the federal law located at 42 U.S.C. Sub. Sect. 4331 et seq., as amended. "Note" means the Limited Revenue Tax Increment Note attached as Schedule C. The Note shall be payable from Ak-ailable Tax Increment. "Project" means the Redevelopment Property and the Minimum Improvements. "Project Area" means Redevelopment Project No. 1, as amended, established in accordance with the Act. "Redeveloper" means Cintas Corporation No. 1, a corporation organized under the laws of the State of Ohio and its permitted successors or assigns. "Redevelopment Plan" means the modified redevelopment plan adopted by the Authority for its Project Area, as amended. "Redevelopment Property" means the real property upon which the Minimum Improvements are to be constructed, which real property is described on Schedule A of this Agreement. "Site Improvements" means those improvements, described on Schedule D and which are qualified improvements to the Redevelopment Property. "State" means the State of Minnesota. ,,Tax Increment" means only that portion of the real estate taxes paid with respect to the Minimum Improvements located on the Redevelopment Property which is remitted to the City as tax increment pursuant to the Tax Increment Act. -4- "Tax Increment Act" means the Tax Increment Financing Act, Minnesota Statutes, Sections 469.174 to 469.179, as amended and as it may be amended. "Tax Increment District" means Tax Increment Financing District No. 3 created by the Council within the Project Area through its adoption of a tax increment financing plan pursuant to the Tax Increment Act. "Tax Increment Plan" means the tax increment financing plan adopted by the Authority in connection with the creation of the Tax Increment District. "Unavoidable Delays" means delays, outside the reasonable control of the Party claiming its occurrence, which are the direct result of strikes, other labor troubles, acts of third parties, unforeseen environmental issues and soil conditions, labor and/or material shortages, unusually severe adverse weather, Acts of God, 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 (including the City and the Authority) which directly result in delays. -5 ARTICLE II Representations and Warranties Section 2.1. Representations hy the Authority. The Authority makes the following representations as the basis for the undertaking on its part herein contained: (a) The Authority is a public body duly organized and existing under the laws of the State. Under the provisions of the Act, the Authority has the power to enter into this Agreement and carry out its obligations hereunder. (b) The Authority has created, adopted and approved the Redevelopment Plan in accordance with the terms of the Act. (c) The Authority has created, adopted and approved the Tax Increment District pursuant to the Tax Increment Act. (d) The Authority proposes to reimburse the Redeveloper for the qualified tax increment eligible costs, which will principally be the Site Improvements. (e) The Authority will cooperate with the Redeveloper with respect to any litigation commenced by third parties in connection with this Agreement. (f) The Authority makes no representation, guarantee, or warranty, either express or implied, and hereby assumes no responsibility or liability as to the Redevelopment Property or its condition (whether regarding soils, pollutants, hazardous wastes or otherwise) or that the Redevelopment Property shall be suitable for the Redeveloper's purposes or needs. Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper represents and warrants that: (a) As of the date of execution of this Agreement, the Redeveloper has received no written notice or written communication from any local, state or federal official that the activities of the Redeveloper or the Authority in the Tax Increment District may be or will be in violation of any environmental law or regulation. (b) The Redeveloper will construct, operate and maintain the Minimum Improvements upon the Redevelopment Property in accordance with this Agreement and all applicable local, State and Federal laws and regulations (including without limitation environmental, zoning, building code and public health laws and regulations). -6- (c) The Redeveloper will obtain all required permits, licenses and approvals, and will meet, in a timely manner, all requirements of all applicable local, state and federal laws and regulations which must be obtained or met before the Minimum Improvements may be lawfully constructed. (d) The Redeveloper is a corporation organized under the laws of the State of Ohio and is a wholly owned subsidiary of Cintas Corporation, a corporation organized under the laws of the State of Washington and 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 will constitute a breach of any obligations of the Redeveloper under the terms and conditions of any indebtedness, agreement or instrument of whatever nature to which Redeveloper is now a party or by which it is bound, which breach will materially adversely affect the ability of Redeveloper to perform its obligations under this Agreement. (e) The Redeveloper agrees that they will cooperate with the Authority with respect to any litigation commenced by third parties in connection with this Agreement. (f) Whenever any Event of Default occurs and the Authority shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement or performance or observance of any obligation or agreement on the part of tl:e Redeveloper under this Agreement, the Redeveloper agrees that they shall, within ten (10) days of written demand, accompanied by a written itemization of fees and expenses, by the Authority, pay to the Authority the reasonable fees of such attorneys and such other expenses so incurred by the Authority. (g) The financing arrangements which the Redeveloper has obtained or will obtain, to finance acquisition or construction of the Minimum Improvements, together with financing provided by the Authority pursuant to this Agreement, will be sufficient to enable the Redeveloper to successfully complete the Minimum Improvements as contemplated in this Agreement. (h) The Redeveloper represents that they would not be able to undertake the Project in the reasonably foreseeable future without the assistance to be provided by the Authority under this Agreement. (i) The Redeveloper represents that the completed Project is reasonably expected to have a value for the calculation of the ad valorem property taxes in excess of $2,000,000 on December 31, 1999, and that the total cost of the Project including fixtures, furnishing, equipment and move -in expenses will exceed $4,500,000. 0) The construction of the Minimum Improvements, in the opinion of the Redeveloper, would not reasonably be expected to occur solely through private investment -7- t within the reasonably foreseeable future without the assistance provided by the Authority pursuant to this Agreement. (k) The Authority has provided to the Redeveloper, and the Redeveloper acknowledges receipt of, a copy of Laws of Minnesota for 1995, Chapter 224, Section 58, codified as Minnesota Statutes, Section 116J.991, and entitled "Public Assistance to Business; Wage and Job Requirements," requiring that within 2 years of receiving the assistance provided pursuant to this Agreement, which for this purpose shall be deemed to be the 2 year period beginning on the date the Certificate of Completion is issued in accordance with Section 4.4, the Redeveloper shall comply with certain jobs and other obligations stated in the above - mentioned statute. The Redeveloper hereby covenants for itself and for Cintas Corporation to comply with said obligations, and the Parties agree that said goal level shall be the creation of 15 full time equivalent jobs within the applicable 2 year period. The Redeveloper acknowledges and agrees that, as required by this statutory provision, failure to meet said goals will result in an Event of Default hereunder and in an obligation of the Redeveloper to repay all of the assistance provided pursuant to this Agreement. The Redeveloper further agrees that said jobs shall have an hourly wage of at least $8.00 per hour for unskilled jobs and at least $10.00 per hour for semi - skilled and skilled jobs. This subparagraph shall not be construed as imposing on the Redeveloper any obligation beyond the scope and purpose of the above - mentioned statute to maintain or provide minimum employment and wage levels. The Redeveloper further agrees to provide to the Authority in a timely manner, or to the State of Minnesota, as may be applicable, any information that is reasonably necessary to comply with the above - mentioned statute and in particular the information necessary to complete the Minnesota Business Assistance Form attached as Schedule F to this Agreement, provided, however, that the Redeveloper's obligation to provide the information referred to in this sentence shall terminate once the Redeveloper has achieved the requirements contained in this Section 2.2(k). (1) For the construction of the Minimum Improvements the Redeveloper will pay wages in accordance with the prevailing wage rate as that term is defined in Ordinance No. 1095 of the City's Code. (m) The Redeveloper shall not allow any use or occupancy of the Project by a "Sexually Orientated Business" as defined in Ordinance No. 965 of the City's Code. (n) Upon completion of the Minimum Improvements, Cintas Corporation will be the occupant. In ARTICLE III Site Improvements; Undertakings of Authoritv and Redeveloper Section 3.1. Construction of Minimum Improvements and Site Improvements. The Redeveloper shall construct the Minimum Improvements and Site Improvements on the Redevelopment Property and will maintain, preserve and keep the Minimum Improvements and Site Improvements in good repair and condition. All contracts for construction of the Minimum Improvements and Site Improvements shall provide that payments for the work thereunder are the sole obligation of the Redeveloper. Neither the City nor the Authority shall have any obligation under such contract. Section 3.2. Reimbursement for Site Improvements. (a) The Redeveloper shall pay contractors, subcontractors, and/or construction managers with whom the Redeveloper has entered into contracts. Upon: 1) submission to the Authority of invoices from such contractors and certifications signed by the Redeveloper to the effect that the costs for which payment was made have been incurred in connection with the Site Improvements and upon receipt of lien waivers from such contractors, subcontractors, and/or construction managers, and 2) submission to the Authority a copy of the executed purchase agreement between the Redeveloper as purchaser and as seller. 3) issuance of the Certificate of Completion pursuant to Section 4.4 hereof, then the Authority shall pay as reimbursement for such Site Improvements the total of such costs by delivery of the Note in accordance with this Section and Section 4.4. (b) The maximum amount of reimbursement for the qualified tax increment costs which will be the Site Improvements can not exceed the principal amount of the Note. In the event the costs of the Site Improvements are less than the principal amount of the Note, then the Note principal and payments shall be reduced accordingly. ME ARTICLE IV Construction of Minimum 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 this Agreement and the Construction Plans. Section 4.2. Construction Plans. (a) Prior to the Redeveloper's commencement of construction of the Minimum Improvements the Redeveloper shall submit to the Authority Construction Plans for the Minimum Improvements. The Construction Plans shall provide for the construction of the Minimum Improvements and shall be in conformity with this Agreement and all applicable state and local laws and regulations. The Authority shall approve the Construction Plans in writing if: (i) the Construction Plans conform to the terms and conditions of this Agreement; (ii) the Construction Plans conform to all Federal, State and local laws, ordinances, rules and regulations applicable to the construction of the Minimum Improvements; (iii) the Construction Plans are adequate to provide for the construction of the Minimum Improvements; and (iv) no Event of Default has occurred and is continuing. No approval by the Authority shall relieve the Redeveloper of the obligation to comply with the terms of this Agreement. No approval by the Authority shall constitute a waiver of any Event of Default. If approval of the Construction Plans is requested by the Redeveloper in writing at the time of submission, such Construction Plans shall be deemed approved unless rejected in writing by the Authority, in whole or in part. Such rejection shall set forth in detail the reasons therefore, and shall be made within ten (10) days after the date of their receipt by the Authority. If the Authority rejects any Construction Plans in whole or in part, the Redeveloper shall submit new or corrected Construction Plans within thirty (30) days after written notification to the Redeveloper of the rejection. The provisions of this Section relating to approval, rejection and resubmission of corrected Construction Plans shall continue to apply until the Construction Plans have been approved by the Authority. The Authority's approval shall not be unreasonably withheld. (b) If the Redeveloper desires to make any material change in the Construction Plans after their approval by the Authority, then the Redeveloper shall submit the proposed change to the Authority for its approval. If the Construction Plans, as modified by the proposed change, conform to the requirements of this Section 4.2 of this Agreement with respect to such previously approved Construction Plans, the Authority shall approve the proposed change and notify the Redeveloper in writing of its approval. Such change in the Construction Plans shall. in any event, be deemed approved by the Authority unless rejected, in whole or part, by written notice by the Authority to the Redeveloper, setting forth in detail the reasons therefore. Such rejection shall be made within five (5) business days after receipt of the notice of such change. A material change shall mean a change which individually, or in aggregate with all prior changes, affects the cost of the Minimum Improvements by One Hundred Thousand and -10- 00 /100 Dollars (S 100,000) or more. Section 4.3. Completion of Construction. (a) Subject to Unavoidable Delays, the Redeveloper shall have substantially completed the construction of the Minimum Improvements by December 31, 1999. All work with respect to the Minimum Improvements to be constructed or provided by the Redeveloper on the Redevelopment Property shall be in substantial conformity in all respects with the Construction Plans as submitted by the Redeveloper and approved by the Authority. (b) The Redeveloper agrees for themselves, their heirs and assigns, and every successor in interest to the Redevelopment Property, or any part thereof, shall promptly begin and diligently prosecute to completion the redevelopment of the Redevelopment Property through the construction of the Minimum Improvements thereon, and that such construction shall in any event be substantially completed within the period specified in this Section 4.3. Section 4.4. Certificate of Completion. (a) Promptly after completion of the Minimum Improvements in accordance with the provisions of this Agreement relating to the obligations of the Redeveloper to construct such improvements (including the date for completion thereof) and this Section 4.4, the Authority shall execute and deliver to the Redeveloper the Certificate of Completion. The Certificate of Completion shall be a conclusive determination and conclusive evidence of the satisfaction and termination of the agreements and covenants in this Agreement with respect to the obligations of the Redeveloper and its successors and assigns, to construct the Minimum Improvements and the date for the completion thereof. (b) If the Authority shall refuse or fail to provide the Certificate in accordance with ,the provisions of this Section 4.4 the Authority shall, within twenty (20) days after written request by the Redeveloper, provide the Redeveloper with a written statement, indicating in adequate detail in what respects the Redeveloper has failed to complete the Minimum Improvements in accordance with the provisions of this Agreement, or is otherwise in default, and what measures or acts it will be necessary, in the opinion of the Authority, for the Redeveloper to take or perform in order to obtain a Certificate of Completion. (c) The construction of the Minimum Improvements shall be deemed to be completed when the City has issued its certificate of occupancy for the Minimum Improvements. -11- ARTICLE V Tax Increment Section 5.1. Tax Increment Certification. Pursuant to the Redevelopment Plan, the Authority has pledged and shall appropriate the Available Revenue to the' payment of the principal of and interest on the Note, said payment to be made in accordance with the terms and provisions as stated in the Note. -12- ARTICLE VI Prohibitions Against Assignment and Transfer; Indemnification Section 6.1. Representation as to Redevelopment. The Redeveloper represents and agrees that their purchase of the Redevelopment Property, and their other undertakings pursuant to this Agreement, are, and will be used, for the purpose of redevelopment of the Redevelopment Property and not for speculation in land holding. The Redeveloper further recognizes that, in view of (a) the importance of the redevelopment of the Redevelopment Property to the general welfare of the Authority; (b) the substantial financing and other public aids that have been made available by the Authority for the purpose of making such redevelopment possible; and (c) the fact that any act or transaction involving or resulting in a significant change in the identity of the parties in control of the Redeveloper or the degree of their control is for practical purposes a transfer or disposition of the property then owned by the Redeveloper, the qualifications and identity of the Redeveloper are of particular concern to the Authority. The Redeveloper further recognizes that it is because of such qualifications and identity that the Authority is entering into the Agreement with the Redeveloper, and, in so doing, is further willing to accept and rely on the obligations of the Redeveloper for the faithful performance of all undertakings and covenants hereby by them to be performed. Section 6.2. Prohibition Against Transfer of Proper and Assignment of Agreement. Also, for the foregoing reasons the Redeveloper represents and agrees that prior to the issuance of the Certificate of Completion: Except 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 their obligations with respect to making the Minimum Improvements under this Agreement, and any other purpose authorized by this Agreement, the Redeveloper has not made or created and will not make or create or suffer to be made or created any total or partial sale, assignment, conveyance, or lease (excluding tenant leases), or any trust or power, or transfer in any other mode or form of or with respect to the Agreement or the Redevelopment Property or any part thereof or any interest therein, or any contract or agreement to do any of the same, without the prior written approval of the Authority. Any such transfer shall be subject to the provisions of this Agreement. Notwithstanding the provisions of Section 6.1 and this Section 6.2, the Redeveloper may transfer the Redevelopment Property to any corporation or other entity controlling, controlled by, or under common control of the Redeveloper. Section 6.3. Release and Indemnification Covenants. (a) The Redeveloper 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 -13- of any person occurring at or about or resulting from any defect in the Minimum Improvements, except for any loss resulting from negligent, willful or wanton misconduct of any such parties. (b) Except for any negligent or willful misrepresentation or any negligent, willful or wanton misconduct of the following named parties, the Redeveloper agrees to protect and defend the Authority 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 Minimum Improvements. (c) The Authority and the governing body members, officers, agents, servants and employees thereof shall not be liable for any damage or injury to the persons or property of the Redeveloper or its officers, agents, servants or employees or any other person who may be about the Redevelopment Property or Minimum Improvements due to any act of negligence of any person, other than the negligence and misconduct of Authority employees or those employed or engaged by the Authority. (d) All covenants, stipulations, promises, agreements and obligations of the Authority contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Authority and not of any governing body member, officer, agent, servant or employee of the Authority in the individual capacity thereof. -14- ARTICLE VII Events of Default Section 7.1. Events of Default Prior to the Issuance of the Certificate of Completion Defined. Prior to the issuance of the Certificate of Completion, 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 (unless the context otherwise provides), any one or more of the following events: (a) Failure by the Redeveloper to pay when due any payments or to provide any funds required to be paid or provided under Article III of this Agreement. (b) Failure of the Redeveloper to submit satisfactory Construction Plans in accordance with Section 4.2 of this Agreement. (c) Failure by the Redeveloper to complete construction of the Minimum Improvements pursuant to the terms, conditions and limitations of Article IV of this Agreement. (d) Failure by the Redeveloper to substantially observe or perform any material covenant, condition, obligation or agreement on its part to be observed or performed hereunder. (e) The Redeveloper shall: (i) file any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under the United States Bankruptcy Code or under any similar federal or state law; or (ii) make an assignment for the benefit of its creditors; or (iii) admit in writing its inability to pay its debts generally as they become due; or (iv) be adjudicated as bankrupt or insolvent; or if a petition or answer proposing the adjudication of the Redeveloper as a bankrupt or its reorganization under any present or future federal bankruptcy act or any similar federal or state law shall be filed in any court and such petition or answer shall not be discharged or denied within ninety (90) days after the filing thereof; or a receiver, trustee or liquidator of the Redeveloper or of the Redevelopment Property, or part thereof shall be appointed in any proceeding brought against the Redeveloper and shall not be discharged within ninety (90) days after such appointment, or if the Redeveloper shall consent to or acquiesce in such appointment. -15- Section 7.2 Events of Default Subsequent to the Issuance of the Certificate of Completion. Subsequent to the issuance of the Certificate of Completion, an Event of Default shall only mean the nonpayment of any property taxes or the failure to pay when due any payments required to be paid under Section 3.3 of this Agreement. Section 7.3. Remedies on Default. Whenever any Event of Default referred to in Section 7.1 of this Agreement occurs, the Authority may take any one or more of the following actions after providing thirty days' written notice to the Redeveloper of the Event of Default, but only if the Event of Default has not been cured within said thirty days, or if the Event of Default is by its nature incurable within said thirty day period, and the Redeveloper fails to provide the Authority with written assurances, deemed satisfactory in the reasonable discretion of the Authority, that the Event of Default will be cured as soon as reasonably possible: (a) Suspend its performance under this Agreement and the Note until it receives assurances from the Redeveloper, deemed adequate by the Authority, that the Redeveloper will cure its default and continue its performance under this Agreement. (b) Terminate this Agreement. (c) Withhold the Certificate of Completion. Section 7.4. No Remedv Exclusive. No remedy herein conferred upon or reserved to either party to this Agreement is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Authority 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 VII. Section 7.5. 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 waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. Section 7.6. Agreement to Pav Attorney's Fees and Expenses. Whenever any Event of Default occurs and the Authority shall employ attorneys or incur other expenses, such reasonable fees and expenses shall be paid in accordance with Section 2.2(f) of this Agreement. -16- ARTICLE VIII Additional Provisions Section 8.1. Conflict of Interest; Authority Representatives Not Individually Liable. No member, official, or employee of the Authority shall have any personal interest, direct or indirect, in this Agreement, nor shall any such member, official, or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership, or association in which he is, directly or indirectly, interested. No member, official, or employee of the Authority shall be personally liable to the Redeveloper, or any successor in interest, in the event of any default or breach by the Authority or for any amount which may become due to the Redeveloper or successor or on any obligations under the terms of this Agreement, except in the case of willful misconduct. Section 8.2. Equal Employment Opportunity, The Redeveloper, for itself and its successors and assigns, agrees that during the construction of the Minimum Improvements provided for in this Agreement that it will comply with all applicable equal employment opportunity and non - discrimination laws, ordinances and regulations. Section 8.3. Titles of Articles and Sections. Any titles of the several parts, Articles, and Sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 8.4. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under this 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, transmitted by facsimile, delivered by a recognized overnight courier or delivered personally; and (a) in the case of the Redeveloper, is addressed to or delivered personally to the Redeveloper at (b) in the case of the Authority, is addressed to or delivered personally to The Housing and Redevelopment Authority In and For the City of Fridley, 6431 University Ave. NE, Fridley, MN 55432, Attention: Executive Director. or at such other address with respect to either party as that party may,. from time to time, designate in writing and forward to the other as provided in this Section. -17- Section 8.5. Counterparts. This agreement is executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 8.6. Time of the-Essence. Time is of the essence of this Agreement. -18- ARTICLE IX Termination of Agreement; Expiration Section 9.1. Termination. The Authority may terminate this Agreement as provided herein, and otherwise this Agreement shall terminate upon payment of the Note and the discharge of all of the Redeveloper's and Authority's other obligations hereunder, but no such termination shall terminate any indemnification or other rights or remedies arising hereunder due to any Event of Default which occurred prior to such termination. Section 9.2. Sections to Survive Termination. Section 6.3 shall, in addition to the other surviving provisions referenced in Section 9. 1, survive the termination of this Agreement. IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf by its duly authorized representatives, and the Redeveloper has caused this Agreement to be duly executed in its name and behalf by its duly authorized representatives on or as of the date first above written. G:\ WPDATA \F \FRIDLEY \06 \DOCS \CONTI.DOC -19- Dated: HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA By Its Chairman By Its Executive Director STATE OF MINNESOTA ) )ss COUNTY OF ) On this day of , 199_ before me, a notary public within and for County, personally appeared and to me personally known who by me duly sworn, did say that they are the Chairman and Executive Director of the Housing and Redevelopment Authority In and For the City of Fridley, Minnesota, a political subdivision of the State of Minnesota, on behalf of said Authority. Notary Public Authority Signature Page - Contract For Private Redevelopment -20- Dated: STATE OF ) )ss COUNTY OF ) CINTAS CORPORATION NO. I Un The foregoing instrument was acknowledged before me this day of . 199_1 by the Cintas Corporation No. 1, on behalf of the corporation. Notary Public Redeveloper Signature Page - Contract for Private Redevelopment -21- of C SCHEDULE A LEGAL DESCRIPTION The following described real property located in the County of Anoka, State of Minnesota: -22- SCHEDULE B CERTIFICATE OF COMPLETION WHEREAS, the Housing and Redevelopment Authority In and For the City of Fridley, Minnesota, a political subdivision of the State of Minnesota (the "Authority ") and Cintas Corporation No. 1 (the "Redeveloper ") have entered into a Contract for Private Redevelopment (the "Agreement ") dated as of , 1999, regarding certain real property legally described in the attached Exhibit I (hereinafter referred to and referred to in the Agreement as the "Redevelopment Property "); and WHEREAS, the Agreement contains certain conditions and provisions requiring the Redeveloper to construct improvements upon the Redevelopment Property (hereinafter referred to and referred to in the Agreement as the "Minimum Improvements "); and WHEREAS, Section 4.4 of the Agreement requires the Authority to provide an appropriate instrument promptly after the substantial completion (as defined in the Agreement) of the Minimum Improvements so certifying said substantial completion; NOW, THEREFORE, in compliance with said Section 4.4 of the Agreement, this is to certify that the Redeveloper has substantially completed the Minimum Improvements in accordance with the conditions and provisions of the Agreement relating solely to the obligations of the Redeveloper to construct the Minimum Improvements (including the dates for beginning and completion thereof), and this certification shall be a conclusive detennination of satisfaction and termination of the agreements and covenants in the Agreement with respect to the obligations of the Redeveloper, and its successors and assigns, to construct the Minimum Improvements and the dates for the beginning and completion thereof. -23- s 6 Dated: . 19 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA By Its Chairman By Its Executive Director STATE OF MINNESOTA ) ) ss COUNTY OF ) On this day of , 199_ before me, a notary public within and for County, personally appeared and to me personally known who by me duly sworn, did say that they are the Chairman and Executive Director of the Housing and Redevelopment Authority In and For the City of Fridley, Minnesota, a political subdivision of the State of Minnesota, on behalf of said Authority. This document was drafted by: KRASS MONROE, P.A. (JRC) Suite 1100 Southpoint Office Center 1650 West 82nd Street Minneapolis, Minnesota 55431 612/885 -5999 Notary Public -24- EXHIBIT 1 LEGAL DESCRIPTION -25- 6 SCHEDULE C Dated: NOTE $250,000.00 UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF ANOKA HOUSING AND REDEVELOPMENT AUTHORITY In and For THE CITY OF FRIDLEY LIMITED REVENUE TAX INCREMENT NOTE (CINTAS PROJECT) The Housing and Redevelopment Authority in and for the City of Fridley (the "Authority "), hereby acknowledges itself to be indebted and, for value received, promises to pay to the order of Cintas Corporation No. 1 (the "Registered Owner "), or its registered assigns, solely from the source, to the extent and in the manner hereinafter provided, the principal amount of this Note, being Two Hundred Fifty Thousand Dollars ($250,000) (the "Principal Amount "), together with interest thereon from February 1, 1999 at a rate of seven and one half percent (7.5 %) per annum on the dates (the "Scheduled Payment Dates ") as set forth on the Payment Schedule attached as Exhibit A hereto and in the amounts stated thereon (the "Scheduled Payments "). This Note shall be payable in semiannual installments commencing on August 1, 2001, and on the 1st day of February and August thereafter until and including August 1, 2007. Upon 30 days' prior written notice from the Authority to the Registered Owner, the Principal Amount is subject to prepayment at the option of the Authority in whole or in part on any Scheduled Payment Date. Each payment on this Note is payable in any coin or currency of the United States of America which on the date of such payment is legal tender for public and private debts and shall be made by check or draft made payable to the Registered Owner and mailed to the Registered Owner at its postal address within the United States which shall be designated from time to time by the Registered Owner. The Note is a special and limited obligation and not a general obligation of the Authority, which has been issued by the Authority pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Section 469.178, Subdivision 4, to aid in financing a "project ", as therein defined, of the Authority consisting generally of defraying certain public redevelopment costs incurred and to be incurred by the Authority within and for the benefit of its Redevelopment Project No. 1 (the "Project Area "). -26- THE NOTE IS NOT A GENERAL OBLIGATION OF THE CITY, THE AUTHORITY OR THE STATE OF MINNESOTA (THE "STATE "). AND NEITHER THE CITY, THE AUTHORITY, THE STATE NOR ANY POLITICAL SUBDIVISION THEREOF SHALL BE LIABLE ON THE NOTE, NOR SHALL THE NOTE BE PAYABLE OUT OF ANY FUNDS OR PROPERTIES OTHER THAN AVAILABLE TAX INCREMENT, AS DEFINED BELOW. The Scheduled Payment of this Note due on any Scheduled Payment Date is payable solely from and only to the extent that the Authority shall have received as of such Scheduled Payment Date, "Available Tax Increment" which is defined in the Contract for Private Redevelopment between the Authority and the Registered Owner (the "Agreement ") as tax increment received as of a Scheduled Payment Date with respect to the certain Minimum Improvements to the real property described in the attached Exhibit B (hereinafter referred to as the "Redevelopment Property ") which real property is located within the City's Tax Increment Financing District No. 3. The Authority shall pay on each Scheduled Payment Date to the Registered Owner the lesser of the Available Tax Increment and the Scheduled Payment due hereon on that date. To the extent that on any Scheduled Payment Date the Authority is unable to make the total Scheduled Payment due on such date as a result of its having received as of such date insufficient Available Tax Increment, such failure shall not constitute a default under this Note and any such deficiency or unpaid portion shall be paid on any subsequent Scheduled Payment Date from the Available Tax Increment. On August 1, 2007, the maturity date of this Note, any unpaid portion shall be deemed to have been paid in full. This Note shall not be payable from or constitute a charge upon any funds of the Authority, and the Authority shall not be subject to any liability hereon or be deemed to have obligated itself to pay hereon from any funds except the Available Tax Increment, and then only to the extent and in the manner herein specified. The Authority makes no representations or covenant, express or implied, that the revenues described herein will be sufficient to pay, in whole or in part, the amounts which are or may otherwise become due and payable hereunder. The Authority's payment obligations hereunder shall be further conditioned on the fact that there shall not at the time have occurred and be continuing an Event of Default under the Agreement, and, further, if pursuant to the occurrence of an Event of Default under the Agreement the Authority elects to terminate the Agreement, the Authority shall have no further debt or obligation under this Note whatsoever. Reference is hereby made to the provisions of the Agreement for a fuller statement of the obligations of the Redeveloper and of the rights of the Authority thereunder, and said provisions are hereby incorporated by reference into this Note to the same extent as though set out in full herein. The execution and 1V*fi . delivery of this Note by the Authority, and the acceptance thereof by the Redeveloper, as the initial Registered Owner hereof, shall conclusively establish this Note as the "Note" (and shall conclusively constitute discharge of the City's obligation to issue and deliver the same to the Redeveloper) under this Agreement. The Registered Owner shall never have or be deemed to have the right to compel any exercise of any taxing power of the Authority or of any other public body, and neither the Authority nor any director, commissioner, council member, board member, officer, employee or agent of the Authority, nor any person executing or registering this Note shall be liable personally hereon by reason of the issuance or registration hereof or otherwise. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things required by the Constitution and laws of the State of Minnesota to be done, to have happened, and to be performed precedent to and in the issuance of this Note have been done, have happened, and have been performed in regular and due form, time, and manner as required by law. This Note may be assigned but upon such assignment the assignor shall promptly notify the Executive Director of the Authority at the offices of the Authority by registered mail, and the assignee shall surrender the same to the Authority either in exchange for a new fully registered note or for transfer of this Note on the registration records for the Note maintained by the Authority. Each such assignee shall take this Note subject to the foregoing condition and subject to all provisions stated or referenced herein. The Authority has elected to issue this Note as a non -tax exempt obligation and accordingly does not anticipate that the interest on this Note is or will be generally exempt from federal or state income taxes, and the Authority makes no representation or covenant with respect to any such exemption. IN WITNESS WHEREOF, the Authority has caused this Note to be executed by the manual signatures of its Chairman and Executive Director and has caused this Note to be dated , 199 Chairman This instrument was drafted by: Krass Monroe, P.A. (JRC) Suite 1100 Southpoint Office Center 1650 West 82 "d Street Bloomington, Minnesota 55431 (612) 885 -5999 Executive Director Im CERTIFICATE OF REGISTRATION It is hereby certified that the foregoing Note, as originally issued on 1999, was on said date registered in the name of Cintas Corporation No. 1 and that, at the request of said Registered Owner of this Note, the undersigned has this day registered this Note as to principal and interest on the Note in the name of such Registered Owner, as indicated in the registration blank below, on the books kept by the undersigned for such purposes. Name of Registered Owner Cintas Corporation No. 1 Date of Registration '1999 -29- Signature of Executive Director EXHIBIT A PAYMENT SCHEDULE SCHEDULED PAYMENT DATES August 1, 2001 February 1, 2002 August 1, 2002 February 1, 2003 August 1, 2003 February 1, 2004 August 1, 2004 February 1, 2005 August 1, 2005 February 1, 2006 -30- SCHEDULED PAYMENTS $35,269.71 $35,269.71 $35,269.71 $35,269.71 $35,269.71 $35,269.71 $35,269.71 $35,269.71 $35,269.71 $35,269.71 EXHIBIT B DESCRIPTION OF REDEVELOPMENT PROPERTY: -31- R . SCHEDULED SITE IMPROVEMENTS Site Preparation which is limited to the following: Export of poor soils Import of fill Testing -32- SCHEDULE E MN BUSINESS ASSISTANCE FORM -33- SCHEDULE F SITE PLAN -34-