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HomeMy WebLinkAbout2006-008 EDAR1 Commissioner Kay Lasman introduced the following resolution and moved its adoption: EDA RESOLUTION NO. 2006 RESOLUTION AUTHORIZING THE ACQUISITION OF REAL PROPERTY FOR REDEVELOPMENT WITHIN TAX INCREMENT DISTRICT NO. 3 WHEREAS, the Brooklyn Center Economic Development Authority (the "EDA a body corporate and politic organized and existing under the laws of the State of Minnesota, has the power to engage in development and redevelopment activities pursuant to Minn. Stat. 469.090 to 469.018 and related statutes; and WHEREAS, there has been duly adopted and is now in legal effect a Modified Redevelopment Plan for Housing Development and Redevelopment Project No. 1, which was initially adopted by the Brooklyn Center Housing and Redevelopment Authority and the Brooklyn Center City Council on July 22, 1985, which initial plan has been subsequently modified and amended by various resolutions; and WHEREAS, the EDA has become concerned about the present status of property located at 1501 James Circle North, which property includes the former Cracker Barrel Restaurant. The EDA has observed that the valuation of the Cracker Barrel site by the Brooklyn Center Assessor shows a land value of $1,250,000 and a building value of $562,000 and its currently for sale; and WHEREAS, it is the intent of the EDA to assure a continued use of the site that will continue or increase its current value and prevent any downward slide or blighting influence the site may have on surrounding properties; and WHEREAS, Cracker Barrel has executed a purchase agreement for 1501 James Circle North in favor of the Brooklyn Center EDA in the amount of $1,825,000 (attached as Exhibit A). NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center that it does hereby authorize the acquisition of Lot 2, Block 1, Richardson Park 2 Addition. BE IT FURTHER RESOLVED that the Executive Director of the EDA be authorized to execute a purchase agreement with the owner of the property located at 1501 James Circle North in the amount of $1,825,000 with such technical changes to the agreement as may be recommended by the City's Attorney. May 8, 2006 Date Presid nt The motion for the adoption of the foregoing resolution was duly seconded by commissioner Kathleen Carmody and upon vote being taken thereon, the following voted in favor thereof: Myrna Kragness, Kathleen Carmody, and Kay Lasman; and the following voted against the same: Diane Niesen, and Mary O'Connor; whereupon said resolution was declared duly passed and adopted. CONTRACT FOR SALE OF REAL ESTATE This CONTRACT FOR SALE OF REAL ESTATE "Contract is entered into this day of May, 2006 by and between CRACKER BARREL OLD COUNTRY STORE, INC., a Tennessee. corporation "Seller whose address is 307 Hartmann Drive, Lebanon, TN 37087, and THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BROOKLYN CENTER "Purchaser whose address is 6301 Shingle Creek Parkway, Brooklyn Center, MN 55430 who hereby :agree, to purchase that certain piece of real property containing approximately 4.23 acres lying and being at 1501 James Circle North in the City of Brooklyn Center, Hennepin County, Minnesota and more particularly .described on Exhibit A attached hereto and made a part hereof (the `Land and that certain 9,748 square foot restaurant building thereon (the "Building"). (The Land and the Building shall be collectively referred to :herein as the "Property. The purchase of the Property shall include all equipment and fixtures, if any, presently located Building on the Property (the "Personal Property Any Personal Property left in the Building as of the date of Closing shall be deemed to be abandoned by Seller. 1. PURCHASE. Purchaser agrees to purchase the Property for the sum of One Million, .Eight Hundred and Twenty Five Thousand ($1,825,000.00) Dollars (the "Purchase Price upon the following terms: (a) an earnest money deposit in the amount of Fifty Thousand ($50,000.00) Dollars "Earnest Money Deposit payable by Purchaser within ten (10) days after the Effective Date of this Contract and (b) One Million, Seven Hundred and Seventy Five Thousand ($1,775,000.00) Dollars cash balance at closing. The Earnest Money Deposit shall be held in escrow by Chicago Title Insurance Company (Attention: Karen J. Green), Suite 920, Grant Building, Pittsburgh, PA 15219, as escrow agent "Title Company with said Earnest Money Deposit being considered as a portion of the Purchase Price unless otherwise stated herein. 2. TITLE. Seller warrants title to be marketable and agrees to convey the Property by Special Warranty Deed, subject to the title exceptions set forth on Exhibit B attached hereto and made a part of and any and all other restrictions, conditions, reservations, limitations of record and easements of record and in place, zoning and any other conditions which a physical inspection of the premises (including geotechnical and/or Phase 1 studies) and an accurate and complete survey would disclose. 3. NO WARRANTY BY SELLER. Seller does not warrant, either expressly or implicitly, the condition or fitness of the Property including the Building, sign poles, fixtures or equipment located thereon and to be conveyed hereunder or as to any use they may be put, any such express or implied warranty being hereby expressly negated. Seller and Purchaser acknowledge and agree that neither party has made any representations, warranties, or agreements to, or on behalf of the other party as to any matter concerning this Contract, the Property, the present use thereof or the suitability of the Property for Purchaser's intended use. In particular, but without limitation, except as expressly set forth in this Contract, Seller (or any agent, attorney, employee, broker or other representative of Seller) makes no representations or warranties with respect to the use or condition of the Property, including (without limitation) the Building, the condition of soils or groundwater affecting the Property and the presence or absence of toxic substances or hazardous materials on, under or about the Property, occupation or management of the Property, compliance with applicable statutes, laws, codes, ordinances, regulations or requirements relating to use, occupancy, leasing, zoning, subdivision, planning, building, fire, safety, health or environmental matters, compliance with covenants, conditions and restrictions (whether or not of record) or compliance with other T:U.egaflRcal EstatetBrooklyn Center, MN\K.050306.doc 1 1 1 1 local, municipal, regional, state or federal statutes, laws, codes, ordinances, regulations or requirements, including, without limitation, any .representations, warranties or agreements relating to zoning, soil, subsoil, environmental conditions of the Property or neighboring properties, the purposes to which the Property is suited, drainage, access to public roads or the effect of any local, state or federal environmental protection laws or regulations. Purchaser hereby acknowledges that pursuant to Section 4 hereof Purchaser is entitled to and shall make its own independent inspection and investigation of the Property and, in entering into this Contract, Purchaser represents and warrants to Seller that it intends to rely solely on such inspection and investigation of the Property. ACCORDINGLY, PURCHASER IS NOT RELYING AND SHALL NOT BE ENTITLED TO RELY UPON ANY REPRESENTATIONS OR WARRANTIES OF SF' 1P,R OR ANY PRINCIPAL, AGENT, PARTNER, ATTORNEY, EMPLOYEE, BROKER OR OTHER REPRESENTATIVE OF SELLER ER AND, AT THE CLOSING UNDER THIS CONTRACT, PURCHASER SHALL ACCEPT CONVEYANCE OF THE PROPERTY IN ITS "AS -IS, WHERE -IS" CONDITION AS OF THE CLOSING DATE, WITH AI.T, FAULTS, WITHOUT ANY REPRESENTATION OR WARRANTY WHATSOEVER FROM SELLER, EXCEPT AS EXPRESSLY SET FORTH HEREIN. The foregoing provisions shall survive closing or termination of the transaction set forth in this Contract. 4. TITLE/SURVEY/TESTING, (a) Purchaser, at its sole option and expense, may obtain a title commitment covering the Property from the Title Company or any other nationally recognized title company "Title Commitment and a survey "Survey of the Property. Purchaser shall have thirty (30) days from the Effective Date of this Contract to examine title, obtain the Title Commitment. and Survey and object by written notice to Seller to any defect of title as shown in the Title Commitment or other defect as shown in the Survey, which was not as represented by Seller. If Seller fails or is unwilling to satisfy any title or survey defect, within a reasonable time and is unable or unwilling to deliver the Property as herein provided, then Purchaser may accept the title and/or Survey with the defect or Purchaser may terminate this Contract, whereupon both parties shall be released from further performance hereunder and the Earnest Money Deposit shall be returned to Purchaser. Seller shall not at any time be obligated to provide to Purchaser any title commitment, title binder, title opinion letter or survey for the Property. Failure by Purchaser to timely notify Seller in writing of objections in the Title Commitment or in the Survey will be deemed an acceptance by Purchaser of the Property and Purchaser will take title to the Property at closing subject to all such matters of record or set forth in the Survey, if any. (b) It is understood and agreed that prior to closing Purchaser, its agents or employees, may enter the Property in order to cause such inspections, surveys or tests as Purchaser may deem necessary to be performed, at Purchaser's expense. Purchaser warrants and agrees that it shall (i) restore the Property to its original condition upon completion of testing and (ii) indemnify, defend (with counsel to be selected by Seller) and hold Seller harmless from and against any and all claims, actions, suits, liens, damages, .losses, costs and expenses of any kind incurred by or filed against Seller resulting from such inspections, surveys or tests conducted by Purchaser, its agents or employees. Purchaser shall provide Seller with a written certificate of commercial general liability insurance in the amount of One Million ($1,000,000.00) Dollars, naming Seller as an additional insured prior to entering upon the Property to conduct said testing. T:\Legat\Rcal Estate\Brooklyn Center, MN\K.050306.doc 2 5. PURCHASER'S DUE DILIGENCE. This purchase and sale is subject to the satisfaction, or waiver by Purchaser, of the following conditions in accordance with the deadlines set forth below: Purchaser shall have until June 1, 2006 (the "Inspection Period to: (i) obtain any necessary governmental approvals, permits; licenses, variances, etc. for its operations or use of the Property; (ii) to acquire a building permit; (iii) to perform title and survey work, geotechnieal, Phase I or other environmental, on -site surveys and investigations on the Property, all of which shall be at Purchaser's sole cost and expense and (iv) to confirm that the Property has available and sufficient utilities for Purchaser's intended use. If Purchaser is not reasonably satisfied with the results of its investigations or actions under this .paragraph at the end of the Inspection Period, Purchaser may, at its option, terminate this Contract by sending written notice thereof to Seller at any time during the Inspection Period and receive a refund of the Earnest Money Deposit. If Purchaser does not elect to terminate this Contract prior to 5:00 p.m., Central time on the last day of the Inspection Period, Purchaser shall be deemed to have waived its right to terminate this Contract pursuant to this section, and the Earnest Money Deposit shall be deemed non refundable to Purchaser except in the event of a default by Seller or as otherwise expressly provided in this Contract, and Purchaser shall be obligated to close under this Contract. If Purchaser elects to cancel this Contract, Purchaser agrees to provide the Seller with copies of all third party reports and other documents related to Purchaser's inspection of the Property. 6. SELLER'S MANAGEMENT APPROVAL. Seller's obligations hereunder shall be contingent upon approval of the transactions contemplated herein by Seller's senior management in writing by no later than 5:00 p.m., Central time on May 19, 2006 (the "Approval Period In the event Seller's senior management approves this Contract, Seller shall notify Purchaser in writing of such fact within three (3) business days from the expiration of the Approval Period, otherwise this Contract shall automatically terminate, the Earnest Money Deposit shall he immediately refunded to Purchaser, and neither party shall have any further obligations hereunder. 7. CONDEMNATION. If, prior to closing, any part of the Property is condemned or appropriated by a public authority or any party exercising the right of eminent domain then this Contract, at the election of the Seiler, may be terminated and the Earnest Money Deposit paid by Purchaser shall be returned and neither party shall have any obligations to the other. Should Seller elect not to terminate the Contract, the Purchase Price shall be reduced by the amount of any compensation received by Seller. TAXES. All municipal, local, county and state ad valorem property taxes on the Property for prior years will be paid by Seller at or before closing. All other taxes and assessments for the current year shall be prorated as of the date of closing. Seller shall pay current installments of all certified assessments at the time of closing. Purchaser shall assume all pending assessments which represent work which is actually in progress or completed on the date of closing, but which have not yet been certified as an assessment. Purchaser will assume all pending assessments representing improvements, which have not as yet commenced at closing. All transfer taxes, closing costs, escrow fees, title premiums, recording costs, title attorney's fees, etc. shall be paid by Purchaser at closing. 9. VACANT POSSESSION. Vacant possession of the Property shall be delivered to Purchaser at the time of Closing. Risk of loss to the Building, fixtures and improvements, if any, located upon the Property shall remain with Seller prior to closing. T:ALegal\Rcai Estate \Rrtxaklyn Center, MMR.0503O6.do. 3 10. CLOSING. Time is of the essence of this Contract. Closing on the Property (`Closing shall take place at the Title Company or other mutually determined location within ten (10) days after Purchaser satisfies its preconditions to closing, but in no event no later than June 1, 2006 (the "Closing Date In the event any time period provided for in this Contract expires on a weekend or legal holiday (being defined by any holiday recognized by the United States. Postal Service), the time period shall be automatically extended to the next business day. Each party hereby agrees to provide to the person responsible for Closing the transaction contemplated hereunder, prior to or at Closing, all information required to be reported by such person under Section 6045 of the Internal Revenue Code of. 1986, as amended. Purchaser and Seller further agree to do all things and execute and deliver all instruments which may be necessary or customary to effectuate the Closing hereunder. 11. DEFAULT. In the event either party defaults under the terms and conditions of this Contract, whereby the other .has a right of termination, the party not in default shall give the defaulting party ten (10) days written notice of the grounds for declaring default. If the default has not been cured within the prescribed period of time, the party not in default may terminate this Contract. In the event. this Contract is terminated as aforesaid and if Seller is the defaulting party, the parties have agreed that Purchaser shall be entitled to the return of its Earnest Money Deposit plus interest thereon. In the event Purchaser is the defaulting party, the parties have agreed that the Earnest .Money Deposit plus interest thereon may be retained by Seller. PURCHASER AND SELLER AGREE THAT SELLER'S ACT` LIAL DAMAGES IN THE .EVENT THAT THE SALE IS NOT CONSUMMA'T'ED DUE TO PURCHASER'S DEFAULT WOULD BE IMPRACTICAL AND EXTREMELY DIFFICULT TO DETERMINE. THEREFORE, THE PARI ACKNOWLEDGE THAT THE DEPOSIT HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES' REASONABIF ESTIMATE OF SELLER'S DAMAGES AND AS SELLER'S EXCLUSIVE REMEDY FOR DAMAGES AGAINST PURCHASER IN THE EVENT OF THE TERMINATION OF THIS CONTRACT DUE TO PURCHASER'S DEFAULT. THE PARTIES FURTHER AGREE THAT THE DEPOSIT SHALL BE PAID OVER TO SELLER AS SELLER'S SOLE REMEDY FOR DAMAGES IN THE EVENT OF A DEFAULT BY PURCHASER, ALL OTHER CLAIMS TO DAMAGES BEING HEREBY EXPRESSLY WANED BY SEI.I FR. CONVERSELY, SELLER AND PURCHASER AGREE THAT PURCHASER'S ACTUAL DAMAGES IN THE EVENT THAT THE SAI .F IS NOT CONSUMMATED DUE TO SEI .L FR'S DEFAULT WOULD BE IMPRACTICAL AND EXTREMELY DIFFICULT TO DETERMINE. THEREFORE, THE PARTIES ACKNOWLEDGE THAT THE RETURN OF THE DEPOSIT HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES' REASONABLE ESTIMATE OF PURCHASER'S DAMAGES AND AS PURCHASER'S EXCLUSIVE REMEDY FOR DAMAGES AGAINST SELLER IN THE EVENT OF THE TERMINATION OF THIS CONTRACT DUE TO SELLER'S DEFAULT. THE PARTIES FURTHER AGREE THAT THE DEPOSIT SHALL BE RETURNED TO PURCHASER AS PURCHASER'S SOLE REMEDY FOR DAMAGES IN THE EVENT OF A DEFAULT BY SELLER, ALL OTHER CLAIMS TO DAMAGES BEING HEREBY EXPRESSLY WAIVED BY PURCHASER. NOTWITHSTANDING THE FOREGOING, IN NO EVENT SHALL THIS SECTION LIMIT THE DAMAGES RECOVERABLE BY EITHER PARTY WITH RESPECT TO (A) THE OTHER PARTY'S OBLIGATION TO INDEMNIFY SUCH PARTY IN ACCORDANCE WITH. THIS CONTRACT, (B) THIRD PARTY CLAIMS, OR (C) THE OTHER PARTY'S FAILURE TO PERFORM ANY OBLIGATIONS WHICH, BY THE EXPRESS TERMS OF C:ALegal\Real F "state \F3rooklyn Center, MMK.050306.doc 4 THIS CONTRACT, SURVIVE THE CLOSING OR TERMINATION OF THIS CONTRACT PURCHASER AND SELLER ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTOOD THE ABOVE PROVISION COVERING LIQUIDATED DAMAGES, AND THAT EACH PARTY WAS REPRESENTED BY COUNSEL WHO EXPLAINED THE CONSEQUENCES OF THIS LIQUIDATED DAMAGES PROVISION AT THE TIME THIS CONTRACT WAS EXECUTED. 12. PURCHASER'S REPRESENTATIONS. Purchaser represents, covenants and warrants that Purchaser has the due power and authority to enter into this Contract and to close the transactions contemplated herein without the consent or intervention of any other parties; the closing of the transactions contemplated herein will not violate any law or ordinance or the terms of any Contracts that Purchaser may have with any other parties; and Purchaser represents that George Tavoularis, as President has the authority to enter into this Contract on its behalf. 13. SELLER'S REPRESENTATIONS. Seller represents, covenants and warrants that Seller has the due power and authority to enter into this Contract and to close the transactions contemplated herein without the consent or intervention of any other parties; the closing of the transactions contemplated herein will not violate any law or ordinance or the terms of any Contracts that Seller may have with any other parties; and Seller represents that the undersigned has the authority to enter into this Contract on its behalf. 14. ASSIGNMENT. This Contract may not be assigned by Purchaser without the express written consent of Seller. Any assignment shall not relieve Purchaser of any obligation set forth herein. 15. BROKER'S COMMISSION. Upon closing of this Contract, Gregg Erickson, as Seller's agent shall receive a commission of six (6 percent of the Purchase Price to be shared equally and paid by Seller at closing if, as and when closing occurs, but not otherwise. Purchaser shall indemnify, defend and hold Seller harmless from any other demands, claims, fees and/or commissions from any other broker. Neither Purchaser nor Seller shall have any liability to any broker in the event the sale of the Property should fail to close for any reason whatsoever, including, without limitation, a default by Seller or Purchaser. 16. TAX DEFERRED EXCHANGE. Purchaser acknowledges that Seller, at its option, may elect to participate in a tax deferred exchange in connection with the sale of the Property under Section 1031 of the 1RC. Purchaser agrees to cooperate with Seller's efforts in participating in such exchange and to execute any and all reasonable documents required by Seller or any qualified intermediary in connection with such exchange. 17. NOTICE. All notice and demands herein required shall be in writing and shall be sent by either (a) United States Certified .Mali, return receipt requested, postage prepaid or (b) national overnight delivery service with return receipt, delivery charge prepaid to Seller at 307 Hartmann Drive, Lebanon, TN 37087, Attention: Property Management, Telephone: (615) 443 -5533, Facsimile: (615) 235 -4054 and to Purchaser at 6301 Shingle Creek Parkway, Brooklyn Center, MN 55430 Telephone: Facsimile: Notices sent by United States Certified Mail as set forth above shall be effective three (3) business days after the same is deposited with the United States Postal Service, postage prepaid. Notices sent by national overnight courier service shall be effective one (1) business day after depositing the same with courier .service, delivery fee prepaid, marked for next day delivery. T:tL.e'al\Rcal FstateRrooklyn Centex, MN\K.050306.d0. 18. APPLICABLE LAW. This Contract shall be governed by and construed under the laws of the state in which the Property is located. 19. EFFECTIVE DATE. This Contract shall be effective as of the date of final execution by the last party signing the Contract (the "Effective Date This Contract shall not be binding on either party, however, until it is fully executed by all parties hereto and the Earnest Money Deposit delivered pursuant to paragraph 1 herein. If Purchaser fails to deliver the Earnest Money Deposit within ten (10) days of the Effective Date of this Contract, Seller may declare this Contract to be null and void, and neither party shall have any further rights, duties or obligations hereunder. After the Effective Date and for as long as this Contract is in effect, Seller may continue to market the Property provided that (i) Seller shall .not enter into any "back -up" Contracts to sell the Property, and (ii) Seller's right to market the Property under this section shall terminate upon Seller's satisfaction or waiver of the conditions set forth herein or expiration of the Inspection Period, as the case may he. 20. RECORDATION. This Contract is not to be recorded. 21. WAIVER/ENTIRE CONTRACT. Except as specifically set forth in this Contract, no term or condition of this Contract will be deemed to have been waived or amended unless expressed in writing and the waiver of any such condition or the breach of any term will not be a waiver of any subsequent breach of the same or other term or condition,. This Contract constitutes the entire Contract between the parties, which incorporates all prior written and/or oral understandings. This Contract shall be binding upon the parties, their heirs, successors or assigns. 22. NO PUBLIC DISCLOSURE. Seller and Purchaser agree not to cause any public disclosure of the terms of this transaction to unrelated third parties, except that Seller and Purchaser may discuss the transaction in confidence with, but not limited to, proposed joint venturers, investors or prospective mortgagees. Nothing contained herein shall prevent any such party from making any disclosures required under applicable law. T:ALegat \Rea Estate \Brooklyn Ce.ater, MN\K.050306.doc Remainder of Page Intentionally Left Blank Signatures Follow on Next Page 6 WITNESSES: IN WITNESS WHEREOF, Seller has executed this Contract this 3 d of May, 2006. WITNESSES: IN WITNESS WHEREOF, Purchaser has executed this Contract this day of May, 2006. A. CAIMLLE W. YUNGEBBERG NOTARY PUBLIC .MItSOTA My Ca Expiry J0.31,2009 T:\Legal Estate\Brooklyn Center, MN\K.0503O6 _c1 7 CRACKER BARREL OLD COUNTRY STORE, INC., a Tennessee corporation By: Name: nfi i c -4 I }rot_ Title: V i Cr-- -`?re THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BROOKLYN CENTER By: Name: Title: 1 EXHIBIT "A" Lot 2, Block 1, Richardson Park 2nd Addition, Hennepin County, Minnesota. EXHIBIT "B" [PERMITTED EXCEPTIONS] 1. A) Real estate taxes Property Identification No. 35- 119 -21 -41 -0019. B) Special assessments hereafter levied. 2. All right of access to Highway 94 or Iiurnbolt Avenue taken or reserved in Document Nos. 1341353, 5064847, 3720213 and 911865. 3. Terms and Conditions of Subdivision Agreement filed August. 15, 1990 as Document No. 2117378 (Torrens) and filed August 16, 1990 as Document No. 5692781 (Abstract). 4. Terms and Conditions of Restrictive Covenant dated May 10, 1989 filed May 11, 1989 as Document No. 2012038. 5. Terms and Conditions of Subdivision Agreement filed April 27, 1989 as Document No. 2008690 (Torrens) and filed May 1, 1989 as Document No. 5529233 (Abstract). 6. Terms and Conditions :of Restrictive Covenant dated December 31, 1985, filed February 18, 1986 as Document No. 1704960. 7. Easement for utilities and drainage as shown on the recorded plats of Richardson Park 2nd Addition, Richardson Park and Richardson Addition. 8. Easement for storm drainage purposes (unconfined) for the benefit of Lot 1, Block 1 as created in Document No. 2121698, filed September 6, 1990. 9. Minerals and mineral rights reserved by the Regents of the University of Minnesota. 10. Subject to the following encroachments as shown in the survey by Sunde Land Surveying, Inc. dated June 14, 1993: a.) Encroachment of fence onto the south side of the property, and b.) Encroachment of curbing onto the Northeast corner of the property. Tti eva Tmtntvm%ARRM Artr wr(l'lini16 10