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HomeMy WebLinkAbout2001-012 EDARCommissioner moved its adoption: Ed Nelson introduced the following resolution and EDA RESOLUTION NO. 2001 12 RESOLUTION APPROVING DEVELOPMENT AGREEMENT INCLUDING A BUSINESS SUBSIDY AGREEMENT BETWEEN THE BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY AND RONSAM LLC FOR THE SALE OF THE EDA OWNED PROPERTY LOCATED AT THE NORTHEAST QUADRANT OF 69 AVENUE NORTH AND BROOKLYN BOULEVARD AND AUTHORIZING THE EDA EXECUTIVE DIRECTOR TO EXECUTE THE DEVELOPMENT AGREEMENT WHEREAS, EDA Resolution No. 2001 -09 authorized the sale of the EDA owned property located at the northeast quadrant of 69 Avenue North and Brooklyn Boulevard in Brooklyn Center, legally described in Exhibit A attached to this resolution (the Property); and WHEREAS, EDA Resolution No. 2001 -09 authorized the sale of the property to RonSam LLC conditional upon approval of a Development Agreement between the EDA and RonSam LLC; and WHEREAS, EDA Resolution 2001 -09 called for a public hearing on the sale of EDA owned property located at the northeast quadrant of 69 Avenue North and Brooklyn Boulevard to RonSam LLC and was approved by the EDA on May 14, 2001; and WHEREAS, EDA Resolution 2001 -10 called for a public hearing on the granting of a Business Subsidy for the 69 and Brooklyn Boulevard Retail Development Project and was approved by the EDA on May 14, 2001; and WHEREAS, after conducting a public hearing on the sale of the property, the EDA considered the terms and conditions of the proposed sale of the property to RonSam LLC as contained in the Development Agreement prepared for the sale of the property; and WHEREAS, after conducting a public hearing on the Business Subsidy Agreement contained in the Development Agreement, the EDA considered the terms of the Business Subsidy Agreement; and WHEREAS, the Brooklyn Center EDA has determined it is in the best interests of the Economic Development Authority and the City of Brooklyn Center to sell the property to RonSam LLC, pursuant to the terms and conditions of the Development Agreement including a Business Subsidy Agreement, reviewed at their June 11, 2001 meeting. 1 1 EDA RESOLUTION NO. 2001 12 NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota as follows: 1. The EDA hereby approves the terms and conditions of the sale of the property to RonSam LLC pursuant to a Development Agreement between the Economic Development Authority and RonSam LLC, which approval also includes approval of the Business Subsidy Agreement contained in and made part of the Development Agreement. 2. The EDA Executive Director is hereby authorized and directed to execute the Development Agreement including the Business Subsidy Agreement between the Economic Development Authority and RonSam LLC for the sale of the property. June 11, 2001 Date Presid t The motion for the adoption of the foregoing resolution was duly seconded by commissioner Bob Peppe and upon vote being taken thereon, the following voted in favor thereof: Myrna Kragness, Ed Nelson, Bob Peppe, and Tim Ricker; and the following voted against the same: none; whereupon said resolution was declared duly passed and adopted. EDA RESOLUTION NO. 2001-12 1267737v6 DEVELOPMENT AGREEMENT BY AND BETWEEN ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER AND RONSAM, LLC 2001 EDA RESOLUTION NO. 2001-12 Page ARTICLE I DEFINITIONS 1 Section 1.1 Definitions 1 ARTICLE II REPRESENTATIONS AND WARRANTIES 4 Section 2.1 Representations and Warranties of the Authority 4 Section 2.2 Representations and Warranties by the Developer 5 ARTICLE III Section 3. Section 3. Section 3. Section 3. Section 3. Section 3. Section 3. Section 3. Section 3. Section 3. Section 3. Section 3. ARTICLE IV Section 4 Section 4 Section 4 Section 4 Section 4 Section 4 Section 4 Section 4 Section 4 Section 4 Section 4 ARTICLE V CONSTRUCTION OF PUBLIC IMPROVEMENTS 16 Section 5.1 No Public Improvements 16 ARTICLE VI FINANCING 16 Section 6.1 Financing 16 Section 6.2 Encumbrance of the Development Property 16 Section 6.3 Copy of Notice of Default to Mortgagee 17 Section 6.4 Mortgagee's Option to Cure Events of Default 17 Section 6.5 Defaults Under Mortgage 17 Section 6.6 Subordination of Agreement 17 1267737v6 TABLE OF CONTENTS CONVEYANCE OF DEVELOPMENT PROPERTY 6 1 Purchase and Sale of Development Property 6 2 Conveyance of Development Property 6 3 "As Is" Conveyance 6 4 Purchase Price 6 5 Title and Survey 6 6 Environmental Matters 6 7 Developer's Right to Inspect 7 8 Representations by Authority 7 9 Contingencies to Closing on Development Property 7 10 Closing on the Development Property 8 11 Costs 9 12 Storm Water Retention Pond 10 CONSTRUCTION OF MINIMUM IMPROVEMENTS 10 .1 Preliminary Plans 10 .2 Construction of Minimum Improvements 10 .3 Construction Plans 10 .4 Commencement and Completion of Construction 11 .5 Certificate of Release of Forfeiture 11 .6 Compliance with Environmental Requirements 11 .7 Additional Responsibilities of the Developer 12 .8 Certificate of Completion 12 .9 Certain Approvals 13 .10 Business Subsidy Agreement 13 .11 Letter of Credit 16 -i- EDA RESOLUTION NO. 2001-12 1267737v6 TABLE OF CONTENTS (continued) Page ARTICLE VII REAL PROPERTY TAXES AND ASSESSMENTS 17 Section 7.1 Real Property Taxes and Assessments 17 ARTICLE VIII INSURANCE AND CONDEMNATION 18 Section 8.1 Insurance 18 Section 8.2 Condemnation 19 ARTICLE IX DEVELOPER COVENANTS 19 Section 9.1 Maintenance and Operation of the Development 19 ARTICLE X TRANSFER LIMITATIONS AND INDEMNIFICATION 20 Section 10.1 Representation as to Development 20 Section 10.2 Limitations on Transfer 20 Section 10.3 Indemnification 21 Section 10.4 Limitation 21 ARTICLE XI EVENTS OF DEFAULT AND DAMAGES 21 Section 11.1 Events of Default Defined 21 Section 11.2 Developer Events of Default 21 Section 11.3 Authority Events of Default 23 Section 11.4 Authority Remedies on Default 23 Section 11.5 Revesting Title in the Authority 23 Section 11.6 Developer Remedies on Default 24 Section 11.7 No Remedy Exclusive 24 Section 11.8 No Additional Waiver Implied by One Waiver 24 Section 11.9 Reimbursement of Attorneys' Fees 24 ARTICLE XII ADDITIONAL PROVISIONS 24 Section 12.1 Conflicts of Interest 24 Section 12.2 Real Estate Agents 25 Section 12.3 Titles of Articles and Sections 25 Section 12.4 Notices and Demands 25 Section 12.5 Counterparts 25 Section 12.6 Law Governing 25 Section 12.7 Consents and Approvals 25 Section 12.8 Representatives 25 Section 12.9 Superseding Effect 25 Section 12.10 Relationship of Parties 25 Section 12.11 Mediation 25 Section 12.12 Venue 26 Section 12.13 Provisions Surviving Rescission or Expiration 26 Section 12.14 Time of Essence 26 EDA RESOLUTION NO. 2001-12 Page EXHIBIT A LEGAL DESCRIPTION OF DEVELOPMENT PROPERTY A -1 EXHIBIT B CERTIFICATE OF COMPLETION B -1 EXHIBIT C CERTIFICATE OF RELEASE OF FORFEITURE C -1 EXHIBIT E QUIT CLAIM DEED D -1 EXHIBIT F PERMITTED ENCUMBRANCES E -1 EXHIBIT G BUSINESS SUBSIDY REPORT F -1 EXHIBIT H DEPICTION OF OTHER PAD SITES G -1 1267737v6 TABLE OF CONTENTS (continued) EDA RESOLUTION NO. 2001-12 DEVELOPMENT AGREEMENT THIS DEVELOPMENT AGREEMENT is made and entered into this day of 2001, by and between the ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER, a public body corporate and politic organized and existing under the laws of the State of Minnesota (the "Authority and Ronsam, LLC, a limited liability company (the "Developer"). RECITALS WHEREAS, on December 19, 1994, the Authority and the City of Brooklyn Center (the "City adopted the Modified Redevelopment Plan (the "Redevelopment Plan") for Housing Development and Redevelopment Project No. 1 (the "Redevelopment Project Area which set forth development objectives for the Redevelopment Project Area. One of the objectives of the Redevelopment Plan is to•acquire blighted or deteriorated residential property for rehabilitation or clearance and redevelopment. WHEREAS, in order to achieve the objectives of the Redevelopment Plan, the Authority has acquired certain real property located in the Project Area more particularly described on Exhibit A attached hereto (which property as so described is hereinafter referred to as the "Development Property and has agreed to convey the Development Property to the Developer pursuant to the terms of this Agreement. WHEREAS, the Developer has agreed to construct a building containing at least 29,640 square feet of commercial space on the Development Property (the "Minimum Improvements and to cause to be constructed at least 13,000 square feet of commercial space on the other Pad Sites (as hereinafter defined). WHEREAS, the Authority believes that the Development, as more fully set forth in this Agreement, is in the best interests of the residents of the City and will foster the redevelopment of blighted property and an increase in the tax base, increase the availability of retail facilities to residents of the City, and will otherwise benefit the health, safety, morals and welfare of residents of the City, in accordance with the public purpose and provisions of the applicable State and local laws and requirements under the Redevelopment Plan. 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 others as follows: ARTICLE I DEFINITIONS Section 1.1 Definitions. All capitalized terms used and not otherwise defined herein shall have the following meanings unless a different meaning clearly appears from the context: 1267737v6 "Act" means Minnesota Statutes, Sections 469.001 -.047 and 469.090 .1081, as amended. 1 l';'. EDA RESOLUTION NO. 2001-12 "Agreement" means this Development Agreement, as the same may be from time to time modified, amended or supplemented. "Authority" means the Economic Development Authority of Brooklyn Center. "Authority Documents" means the documents to be executed and/or delivered by the Authority at the Closing pursuant to Section 3.10 of this Agreement. "Authority Representative" means the Executive Director of the Authority or his designee. "Authority Resolution" means Resolution of the Authority approving designation of the Developer as developer of the Development Property. "Board" means the Board of Commissioners of the Authority. "Certificate of Completion" means the certificate in substantially the form attached hereto as Exhibit B, signed by the Authority Representative certifying completion of the Minimum Improvements. "Certificate of Release of Forfeiture" means the certificate in substantially the form attached hereto as Exhibit C signed by the Authority Representative certifying that the conditions in Section 4.5 hereof have been satisfied. "City" means the City of Brooklyn Center, Minnesota. "Closing" means the closing on the conveyance of the Development Parcel. "Closing Date" means the date on which the Development Property is conveyed by the Authority to the Developer, which date shall be such date as the parties mutually agree, but which date shall in no event be later than September 1, 2001, or 60 days after execution of this Agreement, whichever is earliest. "Completion Date" means the date the Certificate of Completion with respect to the Minimum Improvements is delivered. "Construction Plans" means the plans, specifications, drawings and related documents for the construction of the Minimum Improvements which shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the City's planning commission. "Construction Lender" means the lender or lenders on the Construction Mortgage Loan. "Construction Mortgage Loan" means the construction mortgage loan or loans to be obtained by the Developer to provide construction and permanent fmancing for the construction of the Minimum Improvements. 1267737v6 1 EDA RESOLUTION NO. 2001-12 "County" means the County of Hennepin, Minnesota. "Deed" means the quit claim deed executed by the Authority conveying to the Developer the Development Property, in the form attached hereto as Exhibit D. "Developer" means Ronsam, LLC, a limited liability company, its successors or assigns. "Developer's Documents" means the documents to be executed and/or delivered by the Developer at the Closing pursuant to Section 3.10 of this Agreement. "Developer Event of Default" means the occurrence of an Event of Default set forth in Section 11.2 hereof. "Development" means the Development Property and the Minim constructed thereon as provided in this Agreement. "Development Property" means the real property legally described on Exhibit A attached hereto. 1267737v6 "State" means the State of Minnesota. 3 Improvements to be "Event of Default" means any of the events described in Sections 11.2 or 11.3. "Minimum Improvements" means the construction of a multi- tenant retail building having at least 29,640 square feet of retail space. "Mortgage" means any mortgage loan to the Developer that is secured, in whole or in part, with the Minimum Improvements on the Development Property. "Net Proceeds" means any money paid by an insurer under a policy or policies of insurance required to be provided and maintained by the Developer under Section 10.1 of this Agreement. "Other Improvements" means a convenience store, quick food restaurant and an approximate 6,000 square foot building for use as office, retail or restaurant facility. "Other Pad Sites" means that portion of the Development Property depicted on Exhibit G attached hereto on which the Other Improvements will be constituted. "Permitted Encumbrances" means the permitted encumbrances described in Exhibit F attached hereto. "Preliminary Plans" means the preliminary design, specification and architectural plans for the Minimum Improvements (including, without limitation, materials specifications) submitted by the Developer to the Authority. "Redevelopment Plan" means the redevelopment plan for the Redevelopment Project Area approved by the City and the Authority. 1 EDA RESOLUTION NO. 2001-12 assigns. 1267737v6 "Title Company" means Commercial Partners Title Company, and its successors and "Unavoidable Delays" means delays, outside the control of the party claiming its occurrence, which are the direct result of (a) unusually severe or prolonged bad weather, (b) acts of God, fire or other casualty to the Development, (c) litigation commenced by third parties which, by injunction or other similar judicial action, directly results in delays, (d) the outbreak of war or insurrection, (e) acts of any Federal, State or local governmental unit which directly result in delays, (f) strikes, other labor trouble, (g) delays in delivery of materials for the Minimum Improvements, or (h) soil conditions of the Development Property. ARTICLE II REPRESENTATIONS AND WARRANTIES Section 2.1 Representations and Warranties of the Authority. The Authority makes the following representations and warranties: (a) The Authority is a public body corporate and politic and a governmental subdivision of the State, duly organized and existing under the Act and the Authority has the authority to enter into this Agreement and carry out its obligations hereunder. (b) The Authority has taken all action necessary to create the Redevelopment Project Area and to approve this Agreement and to authorize the execution and delivery of this Agreement and any other documents or instruments required to be executed and delivered by the Authority pursuant to this Agreement. (c) The execution, delivery and performance of this Agreement and any other documents or instruments required pursuant to this Agreement by the Authority does not, and consummation of the transactions contemplated therein and the fulfillment of the terms thereof will not, conflict with or constitute on the part of the Authority a breach of or default under any existing (i) indenture, mortgage, deed of trust or other agreement or instrument to which the Authority is a party or by which the Authority or any of its property is or may be bound, or (ii) legislative act, constitution or other proceeding establishing or relating to the, establishment of the Authority or its officers or its resolutions. (d) There is not pending, nor to the Authority's current actual knowledge is there threatened, any suit, action or proceeding against the Authority before any court, arbitrator, administrative agency or other governmental authority that materially and adversely affects the validity of any of the transactions contemplated hereby, the ability of the Authority to perform its obligations hereunder, or as contemplated hereby or thereby, or the validity or enforceability of this Agreement. (e) No member of the Board of the Authority or officer of the Authority, has either a direct or indirect fmancial interest in this Agreement, nor will any Commissioner of the Authority or officer of the Authority, benefit financially from this Agreement within the meaning of Minnesota Statutes, Section 471.87. 4 EDA RESOLUTION NO. 2001-12 (fj The Authority will reasonably cooperate with the Developer and the City with respect to any litigation commenced by third parties with respect to the Development. Section 2.2 Representations and Warranties by the Developer. The Developer represents and warrants that: (a) The Developer is a limited liability company organized and in good standing under the laws of Minnesota, is not in violation of any provisions of its organizational, documents or the laws of said State, has power to enter into this Agreement and has duly authorized the execution, delivery and performance of this Agreement by proper action of its members. (b) The execution and delivery of this Agreement, the consummation of the transactions contemplated thereby, and the fulfillment of the terms and conditions thereof do not and will not conflict with or result in a breach of any of the terms or conditions of the Developer's organizational documents, any restriction or any agreement or instrument to which the Developer is now a party or by which it is bound or to which any property of the Developer is subject, and do not and will not constitute a default under any of the foregoing or a violation of any order, decree, statute, rule or regulation of any court or of any state or Federal regulatory body having jurisdiction over Developer or its properties, including its interest in the Development, and do not and will not result in the creation or imposition of any lien, charge or encumbrance of any nature upon any of the property or assets of Developer contrary to the terms of any instrument or agreement to which Developer is a party or by which it is bound. (c) The execution and delivery of this Agreement will not create a conflict of interest prohibited by Minnesota Statutes, Section 471.87. (d) Developer will reasonably cooperate with the City and Authority with respect to any litigation commenced by third parties with respect to the Development. (e) There are no pending or threatened legal proceedings, of which the Developer has notice, contemplating the liquidation or dissolution of the Developer or threatening its existence, or seeking to restrain or enjoin the transactions contemplated by the Agreement, or questioning the authority of the Developer to execute and deliver this Agreement or the validity of this Agreement. 1267737v6 1 EDA RESOLUTION NO. 2001-12 CONVEYANCE OF DEVELOPMENT PROPERTY Section 3.1 Purchase and Sale of Development Property. Subject to the terms of this Agreement, the Authority agrees to sell to the Developer, and Developer agrees to buy_ from the Authority, the Development Property. Section 3.2 Conveyance of Development Property. The Authority and the Developer agree that the Closing on the purchase and sale of the Development Property shall occur on the Closing Date. Section 3.3 "As Is" Conveyance. In recognition of the Authority's role as land assembler and the inspections and disclosure rights accorded the Developer, the Developer shall take the conveyance of Development Property on an "AS IS" "WHERE IS" basis, with all faults and defects, without any warranties, express or implied, except those expressly stated in this Agreement, and the Developer waives any claims against the Authority, the City and their respective members and boards, for indemnification, contribution, reimbursement or other payments arising under federal and state law and the common law relating to environmental or any other condition of Development Property. Section 3.4 Purchase Price. The total purchase price to be paid by Developer to the Authority for the Development Property shall be Five Hundred Thirty Thousand Dollars ($530,000). Thirty Thousand Dollars ($30,000) of the purchase price shall be paid to the Authority upon execution of this Agreement. The balance of the purchase price shall be paid on the Closing Date by wire transfer of immediately available federal funds in the amount of $500,000. Section 3.5 Title and Survey. The Authority will obtain a commitment for an owner's title insurance policy issued by the Title Company naming Developer as the proposed owner insured of the Development Property in the amount of the purchase price (the "Commitment"), together with copies of all documents referred to in the Commitment. The Developer shall make any objections to title in writing to the Authority within ten (10) days of receipt of the Commitment, or the same shall be deemed waived. The Authority and the Developer acknowledge and agree that if the Authority does not have good and marketable title to the Development Property on or before the Closing Date, the Developer's sole remedy shall be to terminate this Agreement and obtain a refund of the $30,000 paid upon execution of this Agreement. The Developer has obtained, or will obtain, at Developer's expense, a survey of the Development Property, prepared by a surveyor acceptable to Developer (the "Survey The Developer agrees to take title to the Development Property subject to the Permitted Encumbrances set forth on Exhibit F attached hereto and the same are hereby approved by the Developer and shall not be the basis of any title objection. Section 3.6 Environmental Matters. The Authority makes no representation or warranty as to any environmental matters, the accuracy or completeness of the information 1267737v6 ARTICLE III 6 EDA RESOLUTION NO. 2001-12 contained therein. Neither the City nor the Authority shall have any responsibility or obligation to undertake any clean up or remediation on the Development Property. Section 3.7 Developer's Right to Inspect. Developer is hereby y granted the right to enter upon and inspect, analyze, and test the Development Property for all reasonable purposes, including conducting soil tests. Developer shall pay for the cost of all investigations of the Development Property which are ordered by Developer for purposes of conducting its own investigations of the Development Property. Developer hereby agrees to indemnify and hold the Authority harmless from any claims, damage, costs, and liability (including, without limitation, reasonable attorney's fees) resulting from the entering upon the Development Property or the performing of any of the analyses, tests or inspections referred to in this Section. Section 3.8 Representations by Authority. The Authority represents, to its actual current knowledge, without duty of inquiry or investigation, to the Developer as follows: (a) There are no purchase agreements, leases or other occupancy agreements affecting the Development Property with any person other than the Developer. (b) There is no action, litigation, investigation, condemnation or proceeding of any kind pending or threatened against the Authority which could affect the Development Property, any portion thereof or title thereto. The Authority will give Developer prompt written notice if it learns of anything which would affect or change any of the foregoing representations. Section 3.9 Contingencies to Closing on Development Property. (a) Developer's Contingencies. Developer's obligation to close on the Development Property is expressly conditioned upon each of the following contingencies being satisfied or waived on or before the Closing Date: (i) Developer shall have obtained a commitment, in form and substance acceptable to the Authority, for the financing of the construction of the Minimum Improvements as described in Article VI. (ii) Title to the Development Property shall have been found acceptable, or been made acceptable, in accordance with Section 3.5. (iii) Developer shall have determined that it is satisfied with the results of all matters disclosed by hazardous waste and environmental reviews of the Development Property. (iv) Developer shall have determined that it is satisfied with the results of all matters disclosed by Developer's inspection of the Development Property conducted under Section 3.7, and has determined that the soil conditions are adequate for the intended use. 1267737v6 1 1 EDA RESOLUTION NO. 2001-12 (v) Authority and the Developer shall have executed the Public Improvements Development Agreement referred in Section 5.1 hereof, and the Authority shall have performed all of the obligations required to be performed by Authority under this Agreement as of the Closing Date. (vi) The Authority shall have delivered to the Developer all of the Authority's Documents described in Section 3.10. (b) Authority's Contingencies. The Authority's obligation to close on the sale of the Development Property is expressly conditioned upon each of the following contingencies being satisfied or waived on or before the Closing Date: (i) Developer shall have delivered to the Authority evidence, reasonably acceptable to the Authority, that the Developer has obtained a commitment in the form acceptable to the Authority for the financing for the Minimum Improvements as described in Article VII. (ii) Developer shall have executed the Public Improvements Development Agreement referred in Section 5.1 hereof, and the Developer shall have performed all of the obligations required to be performed by Developer under this Agreement as of the Closing Date. (iii) The Developer shall have delivered to the Authority all of the Developer's Documents described in Section 3.10. (iv) The Developer shall have paid the City $150,000 for its share of the storm water retention pond as provided in Section 3.12 hereof. Section 3.10 Closing on the Development Property (a) Time and Place. Subject to the terms and conditions of this Agreement, the Closing on the purchase and sale of the Development Property shall take place on the Closing Date and shall take place at the St. Paul offices of Briggs and Morgan or such other place which is mutually acceptable to the parties. The Authority shall deliver possession of the Development Property on the Closing Date. (b) Authority's Documents. At the Closing, the Authority shall execute, where appropriate, and deliver all of the following Authority's Documents: (i) The Deed properly executed on behalf of the Authority conveying the Development Property to the Developer subject to the Permitted Encumbrances. (ii) Any abstracts of title in the Authority's possession to any portion of the Development Property which is abstract property. (iii) An affidavit of the Authority indicating on the Closing Date that to its actual current knowledge, without duty of inquiry or investigation, there are no outstanding, 1267737v6 8 1 1 EDA RESOLUTION NO. 2001-12 unsatisfied judgments, tax liens or bankruptcies against or involving the Development Property; that there has been no labor or material furnished to the Development Property for which payment has not been made or for which mechanic's liens could be filed; and that there are no other unrecorded interests in the Development Property. (iv) Such other documents as shall be required to carry out the intent of this Agreement. (c) Developer's Documents. At the Closing, the Developer shall execute, where appropriate, and deliver all of the following Developer's Documents: (i) The payment of the balance of the purchase price for the Development Property, which shall be paid by delivery to the Authority of cash in the amount of $500,000 by the wire transfer of immediately available federal funds. (ii) Proof of insurance required pursuant to this Agreement. (iii) To the extent required and obtainable as of the Closing Date, environmental clearances, subdivision approvals, permits, and any other required governmental approvals for the Minimum Improvements. (iv) Funds sufficient for payment by the Developer at Closing of the recording charges or fees for all documents which are to be placed on record, the fee or charge imposed by any closing agent designated by the Title Company, and any other incidental or related closing costs. State of the State. (v) A certificate of good standing for Developer from the Secretary of (vi) A sworn construction cost statement covering the total costs of the Minimum Improvements. 4.11 hereof; (vii) Delivery to the Authority of the letter of credit required by Section (viii) A payment in the amount of $150,000 to the City for the Developer's share of the cost of the storm water retention pond as provided in Section 3.12 hereof. (ix) Such other documents as shall be required to carry out the intent of this Agreement. Section 3.11 Costs.The Authority and the Developer each shall pay their own attorneys' fees. The Developer shall pay, among other things, the Title Company's closing fee and any other fees related to the Commitment. The Authority shall pay the state deed tax and the fees of Title Company for its title work relating to the issuance of the Commitment. The Developer shall pay the cost of any surveys, the cost of any environmental audits or work, the premium for 1267737v6 9 1 EDA RESOLUTION NO. 2001-12 the title insurance policy, any mortgage registry tax and the cost of recording the Deed, the cost of Developer's inspection of the Development Property and any and all other closing costs related to the transfer of the Development Property to the Developer not specifically agreed to herein to be paid by the Authority. Section 3.12 Storm Water Retention Pond. The Developer acknowledges that the City is in the process of constructing a storm water retention pond in the vicinity of the Development Property. The construction of the storm water pond was necessitated by development in the area including the development of the Development Property and the other Pad Sites. The Developer agrees to pay the City at Closing $150,000 in immediately available funds as its share of the cost of the storm water retention pond. CONSTRUCTION OF MINIMUM IMPROVEMENTS Section 4.1 Preliminary Plans. The Authority and the Developer acknowledge that before the date of this Agreement, the Developer submitted to the Authority the Preliminary Plans for the Minimum Improvements. Developer represents that the Preliminary Plans are consistent with the Redevelopment Plan, this Agreement, and all applicable State and local laws and regulations, insofar as said consistency may be determined at said preliminary stage. The Preliminary Plans have been reviewed and approved by the Authority staff. Section 4.2 Construction of Minimum Improvements. Subject to the terms and conditions of this Agreement, the Developer agrees to construct the Minimum Improvements on the Development Property in conformance with the approved Construction Plans for the Minimum Improvements. No material changes shall be made to the Construction Plans for the Minimum Improvements without the Authority's prior written approval. In no event should any of these changes (a) affect the quality of the Development as provided in the Construction Plans approved by the Authority, (b) materially affect the design, colors, materials or appearance of the exterior of the Minimum Improvements, including landscaping, or (c) reduce the quality of the construction materials for the Minimum Improvements. The Developer acknowledges and understand that the Authority will require, prior to the issuance of a building permit for the construction of the Other Improvements on the Other Pad Sites, that (a) the Developer commence construction of the Minimum Improvements, and (b) the materials, color and design of the exterior of the Other Improvements and landscaping have the same distinct design and quality as those elements for the Minimum Improvements. Section 4.3 Construction Plans (a) The Developer shall deliver to the Authority no later than thirty (30) days prior to Closing the Construction Plans for the Minimum Improvements. The Authority shall review the Construction Plans and will deliver to the Developer before the Closing Date, a written statement approving the Construction Plans or a written statement rejecting the Construction Plans and specifying the deficiencies in the Construction Plans. The Authority shall approve the Construction Plans if: (i) the Construction Plans substantially conform to the 1267737v6 ARTICLE IV 10 1 EDA RESOLUTION NO. 2001-12 terms and conditions of this Agreement; (ii) the Construction Plans are consistent with the goals and objectives of the Redevelopment Plan; and (iii) the Construction Plans do not violate any applicable Federal, State or local laws, ordinances, rules or regulations. If the Construction Plans are not approved by the Authority, then the Developer shall make such changes as the Authority may reasonably require. (b) The approval of the Construction Plans, or any proposed amendment to the Construction Plans, by the Authority does not constitute a representation or warranty by the Authority that the Construction Plans or the Minimum Improvements comply with any applicable building code, health or safety regulation, zoning regulation, environmental law or other law or regulation, or that the Minimum Improvements will meet the qualifications for issuance of a certificate of occupancy, or that the Minimum Improvements will meet the requirements of the Developer or any other users of the Minimum Improvements. Approval of the Construction Plans, or any proposed amendment to the Construction Plans, by the Authority will not constitute a waiver of an Event of Default. Section 4.4 Commencement and Completion of Construction. Subject to the terms and conditions of this Agreement and to Unavoidable Delays, the Developer will commence construction of the Minimum Improvements within sixty (60) days after the Closing Date and the Completion Date for the Minimum Improvements shall be within eighteen (18) months of the Closing Date. The Minimum Improvements will be constructed by the Developer on the Development Property in conformity with the Construction Plans approved by the Authority. Prior to delivery of the Certificate of Completion to the Developer upon the request of the Authority the Developer will provide the Authority reasonable access to the Development Property. "Reasonable access" means at least one site inspection per week during regular business hours. During construction and marketing of the Minimum Improvements, the Developer will deliver progress reports to the Authority from time to time as mutually agreed upon by the Authority and the Developer. Section 4.5 Certificate of Release of Forfeiture. The Developer shall notify the Authority when the Construction Lender has approved the first advance of the proceeds of the Construction Mortgage Loan, as evidenced by an approved draw request signed by the Construction Lender, subject only to the delivery by the Authority of an executed Certificate of Release of Forfeiture. Promptly upon receipt of the foregoing the Authority will furnish to the Developer a Certificate of Release of Forfeiture in the form attached hereto as Exhibit D. The Developer shall cause the Certificate of Release of Forfeiture to be recorded in the proper office for recordation of deeds and other instruments pertaining to the Development Property. Section 4.6 Compliance with Environmental Requirements. The Developer shall comply with all applicable local, State, and Federal environmental laws and regulations, and will obtain, and maintain compliance under, any and all necessary environmental permits, licenses, approvals or reviews. As of the date of this Agreement, the Developer has received no notice or communication from any local, State, or Federal official that the activities of the Developer, Authority under this Agreement may be or will be in violation of any environmental law or regulation. 1267737v6 11 1 1 EDA RESOLUTION NO. 2001-12 Section 4.7 Additional Responsibilities of the Developer. (a) The Developer will construct, operate and maintain, or cause to be operated and maintained, the Minimum Improvements in substantial accordance with the terms of this Agreement, the Redevelopment Plan, and all local, State, and Federal laws and regulations (including, but not limited to zoning, building code and public health laws and regulations), except for variances necessary to construct the Minimum Improvements contemplated in the Construction Plans approved by the Authority. (b) The Developer will obtain, in a timely manner, all required permits, licenses, and approvals, and will meet, in a timely manner, all requirements of all applicable local, State, and Federal laws and regulations which must be obtained or met before the Minimum Improvements may be lawfully constructed. (c) The Developer will not construct any building or other structures on, over, or within the boundary lines of any public utility easement unless such construction is provided for in such easement or has been approved by the utility involved. (d) The Developer, at its own expense, will replace any public facilities and public utilities damaged during the construction of the Minimum Improvements, in accordance with the technical specifications, standards and practices of the owner thereof. (e) The Developer will prepare, submit and receive approval from the City and its Planning Commission for the subdivision plat for any portion of the Minimum Improvements, as applicable and appropriate. (f) The Developer will comply with all applicable local, state and federal environmental laws and regulations, as they relate to the Minimum Improvements. Section 4.8 Certificate of Completion. The Developer shall notify the Authority when the construction of the Minimum Improvements have been substantially completed. The Authority shall promptly inspect the Minimum Improvements in order to determine whether the same has been constructed in substantial conformity with the approved Construction Plans. If the Authority determines that the Minimum Improvements have not been constructed in substantial conformity with the approved Construction Plans, the Authority shall deliver a written statement to the Developer indicating in adequate detail the specific respects in which the same has not been constructed in substantial conformity with the approved Construction Plans and Developer shall promptly remedy such deficiencies. Promptly upon determining that said Minimum Improvements have been constructed in substantial conformity with the approved Construction Plans, the Authority will furnish to the Developer a Certificate of Completion in the form attached hereto as Exhibit B certifying the completion of the Minimum Improvements. The Certificate of Completion issued for the Minimum Improvements shall conclusively satisfy and terminate the agreements and covenants of the Developer in this Agreement and the Deed as it relates to said Minimum Improvements. The Developer shall cause the Certificate of Completion to be recorded in the proper office for recordation of deeds and other instruments pertaining to the Development Property. 1267737v6 12 1 EDA RESOLUTION NO. 2001-12 Section 4.9 Certain Approvals. The Developer acknowledges and agrees that any approval by the Authority given pursuant to this Agreement does not constitute the consent or approval of the City or any other governmental body or entity to the Development, the subdivision of the Development Property, the plans for or the construction of the Minimum Improvements, or any other aspect thereof, including without limitation, use, zoning, building code and watershed requirements, and the Authority shall have no liability to the Developer for damages or otherwise for failure of the Developer to obtain any required consents, approvals, permits and licenses for the Development in accordance with all applicable laws and regulations. Section 4.10 Business Subsidy Agreement. The Developer and the Authority recognize and agree that the sale of the Development Property to the Developer pursuant to this Agreement for a purchase price less than its fair market value is a "business subsidy" under Minnesota Statutes, Section 116J.993 through 116J.995, as amended (the "Subsidy Law and is subject to the provisions thereof, including without limitation reporting requirements and five year commitment by the Developer. Accordingly, it is agreed: (a) The estimated fair market value of the subsidy is $730,000 (the "Subsidy which is the difference between the purchase price of the Development Property (i.e., $530,000) and its reasonably estimated fair market value (i.e., $1,260,000); (b) The public purpose of the Subsidy is to further provide additional commercial facilities in the City, increase the tax base and to create jobs. (c) For its "Job Goals" under this Section 4.10 the Developer covenants that it will provide or cause to be provided, in connection with the Minimum Improvements and Other Improvements, 20 full -time equivalent permanent employee positions within two years of the Benefit Date, with these jobs having wage levels of at least $7.00 per hour, exclusive of benefits. (d) For purposes of Section 116J.994, Subdivision 3, of the Subsidy Law, the goals of the Subsidy are the construction of the Minimum Improvements and Other Improvements and use thereof by the Developer, its successors in interest, or their tenants for at least five years after the "Benefit Date" of the Subsidy, as defined in the Subsidy Law, which is hereby determined to be the date of the issuance of a certificate of occupancy for the Minimum Improvements or the Other Improvements, whichever occurs earlier. (e) For purposes of the Subsidy Law, the Subsidy shall be considered to be a forgivable loan to the Developer from the Authority. It is agreed, as required by Section 116J.994, Subdivision 6, if the Developer is in default under this Section 4.10 subject to any remedial provisions of the Subsidy Law as may be applicable, the Developer shall be obligated to repay the Subsidy plus interest on all such amounts at the implicit price deflator, as defined under Minnesota Statutes, Section 275.70, Subdivision 2. If the Developer meets some but not all of its Job Goals hereinafter defined, the Developer may request in writing, and Authority may agree in the absolute discretion of the Board of Commissioners, that the Subsidy be repaid by the Developer pro rata, e.g., if only 10 of the 20 jobs at the Minimum Improvements and Other 1267737v6 13 1 EDA RESOLUTION NO. 2001-12 Improvements, the Developer would repay 50% of the Subsidy paid to the Developer, plus accrued interest thereon. The Subsidy is needed in order to induce the Developer to construct the Minimum Improvements. The Developer covenants that it will continue to own the Minimum Improvements for at least five years after the Benefit Date. (f) The Developer represents that it has no parent corporation. (g) The Developer represents that the following are all of the State of Minnesota and "local government agency" grants (other than the Subsidy hereunder) to the Minimum Improvements: None Grantor Value (h) The Developer represents that it is not in default on the date hereof on any subsidy agreement entered into by the Developer under the Subsidy Law. (i) The Developer shall complete and file with the Authority from time to time the report in the form of the attached Exhibit G. The Subsidy Law provides that if the Developer does not make such reports, when due, the Authority must mail the Developer a warning within one week of the required filing date, and if, after 14 days after the postmark date of that warning, the Developer continues to fail to report, then the Developer is required to and shall pay the Authority a penalty of $100 for each subsequent day until the report is filed, up to a maximum of $1,000. The Developer shall file these reports with the Authority, in care of the Executive Director, (1) on March 1 of each year, beginning with the March 1 immediately following the Benefit Date, and (2) within 30 days after the "Compliance Date," hereby defined to be the date which is two years after the Benefit Date. Each March 1 report shall report on the prior calendar year, and each other report shall report on the period since the last reporting period. (j) This Section 4.10 is intended to be the "subsidy agreement" required by Section 1161994, Subdivision 3, of the Subsidy Law. In the event that any provision of this Section 4.10 is inconsistent or in conflict with any provision of the Subsidy Law, and in the event that any provision of the Subsidy Law provides additional requirements, the provisions of the Subsidy Law shall apply and govern. In addition to all reporting obligations of the Developer under this Section 4.10 and Exhibit G, the Developer agrees to provide the Authority with any additional information which may be required in order for the Authority to comply with its reporting requirements, as they may exist or be amended from time to time, under the Subsidy Law. (k) Nothing in this Section 4.10 is intended to limit or otherwise amend the other terms of this Agreement. To the extent that provisions in this Section 4.10 are more extensive or restrictive than any related term elsewhere in this Agreement, the provisions hereof shall govern. The above commitment of the Developer to own the Minimum Improvements for 1267737y6 Grantor Value 14 EDA RESOLUTION NO. 2001-12 at least five years from the Benefit Date is a requirement of the Subsidy Law (subject to procedures therein allowing relaxation or waiver of said requirement) and shall apply and govern. 1267737v6 15 1 EDA RESOLUTION NO. 2001-12 Section 4.11 Letter of Credit As security for the Developer's obligations hereunder, the Developer shall deliver to the Authority on the Closing Date an irrevocable letter of credit issued by a financial institution acceptable to the Authority and in a form satisfactory to the Authority. If the original letter of credit, or any substitute, replacement or renewal letter of credit, expires before the issuance of the Certificate of Completion under Section 4.8 hereof (the "Termination Date the Developer shall, at least 30 days prior to such expiration date, provide the Authority with evidence that such letter of credit has been renewed or, in the alternative deposit with the Authority, cash or a certified check or furnish a new letter of credit in form and substance satisfactory to the Authority, all in the same principal amount. The security provided by the letter of credit, or any of the above alternatives, shall be provided in the face amount of $100,000 until the Termination Date. Any letter of credit provided hereunder shall, in any event, entitle the Authority to draw upon the full amount thereof if (a) the letter of credit is neither renewed nor replaced as required above or (b) an Event of Default should occur under Section 11.2 of this Agreement. 1267737v6 ARTICLE V CONSTRUCTION OF PUBLIC IMPROVEMENTS Section 5.1 No Public Improvements. It is anticipated that the City and the Developer enter into a separate agreement (the "Public Improvements Development Agreement pursuant to which the City will replace the existing water and sewer lines within the existing easement on the Development Property. Except as may be provided in that agreement, neither the Authority nor the City shall have any obligation to construct, install, improve or modify any other public improvements (including without limitation streets, sidewalks, curbs or utility services) in connection with the Development. ARTICLE VI FINANCING Section 6.1 Financing. On or before the Closing Date, the Developer will deliver written evidence reasonably acceptable to the Authority of a commitment or commitments for financing the construction of the Minimum Improvements and the source of money for all payments due from the Developer under the terms of this Agreement, including payment of the purchase price for the Development Property. lithe source of such money is a loan from a financial institution, the Developer must also provide evidence of a commitment or commitments from such financial institution to provide such loan. Section 6.2 Encumbrance of the Development Property. Until the Completion Date, neither the Developer nor any successor in interest to the Developer will engage in any financing or any other transaction creating any mortgage or other encumbrance or lien upon the Development Property, or portion thereof, whether by express agreement or operation of law, or suffer any encumbrance or lien to be made on or attach to the Development Property except for the purpose of obtaining funds only to the extent necessary for making the Minimum 16 EDA RESOLUTION NO. 2001-12 Improvements (including, but not limited to, land and building acquisition, labor and materials, professional fees, real estate taxes, construction interest, organization and other indirect costs of development, costs of constructing the Minimum Improvements, and an allowance for contingencies). Section 6.3 Copy of Notice of Default to Mortgagee. If the Authority delivers any notice or demand to the Developer with respect to any Event of Default under this Agreement, the Authority will also deliver a copy of such notice or demand to the mortgagee of any Mortgage at the address of such mortgagee provided to the Authority in a written notice from the Developer or the mortgagee. Section 6.4 Mortgagee's Option to Cure Events of Default. Upon the occurrence of an Event of Default, the mortgagee under any Mortgage will have the right (insofar as the rights of the Authority are concerned), at its option, to cure or remedy such Event of Default. Section 6.5 Defaults Under Mortgage. In the event the Developer is in default under any Mortgage, the mortgagee, within ten (10) days after it becomes aware of any default and prior to exercising any remedy available to it due to such default, will notify the Authority in writing of (i) the fact of default; (ii) the elements of default; and (iii) the actions required to cure the default. If, within the time period required by the Mortgage, the Authority cures any default under the Mortgage, the mortgagee will pursue none of its remedies under the Mortgage based on such default. Section 6.6 Subordination of Agreement. In order to facilitate the obtaining of financing for the construction of the Minimum Improvements, the Authority agrees to subordinate the provisions of the Development Agreement and the Deed to the documents executed in connection with the Construction Loan Mortgage, provided that such subordination shall not deprive the Authority or otherwise limit any of the Authority's rights or remedies under this Agreement. REAL PROPERTY TAXES AND ASSESSMENTS Section 7.1 Real Property Taxes and Assessments. The Authority shall pay any real estate taxes with respect to the Development Property payable prior to the year in which a Closing occurs and all pending and certified special assessments. Any real estate taxes payable with respect to the Development Property in the year of the Closing shall be prorated on a calendar year basis between the Developer and the Authority as of the Closing Date. The Developer shall pay all real estate taxes due and payable with respect to the Development Property in the year following the year in which the Property is conveyed or otherwise transferred to the Developer and each year thereafter. 1267737v6 ARTICLE VII 17 EDA RESOLUTION NO. 2001-12 ARTICLE VIII INSURANCE AND CONDEMNATION Section 8.1 Insurance (a) The Developer will obtain and continuously maintain insurance on the entire Development and, from time to time at the request of the Authority, furnish proof to the Authority that the premiums for such insurance have been paid and the insurance is in effect. The insurance coverage described below is the minimum insurance coverage that the Developer must obtain and continuously maintain: (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 applicable Ownership Unit or Rental Building at the date of completion, and with coverage available in nonreporting form on the so -called "all risk" form of policy. (ii) Comprehensive general liability insurance (including operations, contingent liability, operations of subcontractors, completed operations and contractual liability insurance) together with an Owner's /Contractor's Policy naming the Authority, and City as an additional insured, with limits against bodily injury and property damage of not less than $1,000,000 for each occurrence (to accomplish the above required limits, an umbrella excess liability policy may be used), written on an occurrence basis. (iii) Workers compensation insurance, with statutory coverage. (b) All insurance required in this Article shall be obtained and continuously maintained in responsible insurance companies selected by the Developer or its successor that are authorized under the laws of the State to assume the risks covered by such policies. The Developer shall deposit annually with the Authority 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, each policy must contain a provision that the insurer will not cancel nor modify the policy without giving written notice to the insured and the Authority at least thirty (30) days before the cancellation or modification becomes effective. Not less than fifteen (15) days prior to the expiration of any policy, the Developer or its successor must furnish the Authority evidence satisfactory to the Authority that the policy has been renewed or replaced by another policy conforming to the provisions of this Article, or that there is no necessity for the policy under the terms of this Agreement. In lieu of separate policies, the Developer or its successor may maintain a single policy, blanket or umbrella policies, or a combination thereof, having the coverage required herein, in which event the Developer or its successor will deposit with the Authority a certificate or certificates of the respective insurers as to the amount of coverage in force. (c) The Developer agrees to notify the Authority immediately in the case of damage exceeding $100,000 in amount to, or destruction of, the Minimum Improvements or any portion thereof resulting from fire or other casualty. Subject to the terms of any Mortgage, in the 1267737v6 18 1 EDA RESOLUTION NO. 2001-12 event that any such damage does not exceed $100,000, the Developer will forthwith repair, reconstruct and restore the Minimum Improvements to substantially the same or an improved condition or value as it existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restoration, the Developer or its successor will apply the Net Proceeds of any insurance relating to such damage received by the Developer or its successor to the payment or reimbursement of the costs thereof. In the event the Minimum Improvements or any portion thereof is destroyed by fire or other casualty, and the damage or destruction is estimated to equal or exceed $100,000, then the Developer, within one hundred fifty (150) days after such damage or destruction, subject to the terms of any Mortgage, will proceed forthwith to repair, reconstruct and restore the damaged Minimum Improvements to substantially the same condition or utility value as it existed prior to the event causing such damage or destruction and, to the extent necessary to accomplish such repair, reconstruction and restoration, the Developer will apply the Net Proceeds of any insurance relating to such damage or destruction received by the Developer to the payment or reimbursement of the costs thereof. Developer shall pay the entire cost of repair, reconstruction and restoration if the net proceeds of the insurance are insufficient. Section 8.2 Condemnation. In the event that title to and/or possession of the Development Property and Minimum Improvements, or any material part thereof, is threatened with a taking through the exercise of the power of eminent domain, the Developer will notify the Authority of the threatened taking with reasonable promptness. DEVELOPER COVENANTS Section 9.1 Maintenance and Operation of the Development. Developer will at all times during the term of this Agreement, maintain and operate the Development in a safe and secure way and in compliance with this Agreement and all Federal, State and local laws, regulations, rulings and ordinances applicable thereto. Developer shall pay all of the reasonable and necessary expenses of the operation and maintenance of the Development, including all premiums for insurance insuring against loss or damage thereto and adequate insurance against liability for injury to persons or property arising from the construction of the Minimum Improvements as required pursuant to this Agreement. Developer shall not knowingly cause any person working in or attending the Development for any purpose, to be exposed to any hazardous or unsafe condition; provided that Developer shall not be in default hereunder if it has required the tenants or contractors employed by Developer to perform work on the Development to take such precautions as may be available to protect the persons in and around the Development from hazards arising from the work or employment, and has further required each such contractor or tenant to obtain and maintain liability insurance protecting against liability to persons for injury arising from the work. The expenses of operation and maintenance of the Development shall be borne solely by Developer or its tenants. 1267737v6 ARTICLE IX 19 1 EDA RESOLUTION NO. 2001-12 ARTICLE X TRANSFER LIMITATIONS AND INDEMNIFICATION Section 10.1 Representation as to Development. The Developer represents to the Authority that its purchase of the Development Property, and its other undertakings under this Agreement, are for the purpose of developing commercial properties, and not for the purpose of speculation in land holding. The Developer acknowledges that, in view of the importance of the development of the Development Property to the general welfare of the Authority and the City, the qualifications and identity of the Developer are of particular concern to the Authority. The Developer further acknowledges that the Authority is willing to enter into this Agreement with the Developer because of the qualifications and identity of the Developer. Section 10.2 Limitations on Transfer. The Developer may, with prior written notice to the Authority, sell, assign, convey, or transfer in any mode or manner, all or a portion of this Agreement, the Development Property or the Minimum Improvements to a lender providing construction or permanent financing for the Minimum Improvements. Except as otherwise provided in this Section, the Developer will not sell, assign, convey, lease or transfer in any other mode or manner this Agreement, the Development Property or the Minimum Improvements, or any interest therein, without the express written approval of the Authority which approval shall not be unreasonably withheld. The Authority shall be entitled to require, as conditions to any approval of any sale, assignment, conveyance, use or transfer of this Development Agreement, the Development Property or the Minimum Improvements that: (a) Any proposed transferee shall have the qualifications and financial responsibility, as determined by the Authority, necessary and adequate to fulfill the obligations undertaken in this Agreement by the Developer; (b) Any proposed transferee, by instrument in writing satisfactory to the Authority and the City and in form recordable among the land records shall, for itself and its successors and assigns, and expressly for the benefit of Authority, have expressly assumed all of the obligations of the Developer under this Agreement and agreed to be subject to all the conditions and restrictions to which the Developer is subject; (c) There shall be submitted to the Authority for review all instruments and other legal documents involved in effecting transfer, and if approved by Authority, its approval shall be indicated to the Developer in writing; (d) The Developer and its transferee shall comply with such other conditions as the Authority may fmd desirable in order to achieve and safeguard the purposes of the Act, the Development Plan and the Developer Documents; and (e) In the absence of specific written agreement by the Authority and the City to the contrary, no such transfer or approval by the Authority and the City thereof shall be deemed to relieve the Developer or any other party bound in any way by this Agreement or 1267737v6 20 1 EDA RESOLUTION NO. 2001-12 otherwise with respect to the construction of the Minimum Improvements, from any of its obligations with respect thereto. Section 103 Indemnification (a) The Developer releases from and covenants and agrees that the Authority and the City, their governing body members, officers, agents, including the independent contractors, consultants and legal counsel, servants and employees thereof (hereinafter, for purposes of this Section, collectively the "Indemnified Parties shall not be liable for and agrees to indemnify and hold harmless the Indemnified Parties 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 Development to the extent not attributable to the gross negligence of the Indemnified Parties. (b) Except for gross negligence of the Indemnified Parties, the Developer agrees to indemnify the Indemnified Parties, now and forever, and further agrees to hold the aforesaid harmless from any claims, demands, suits, costs, expenses (including reasonable attorney's fees), actions or other proceedings whatsoever by any person or entity whatsoever arising or purportedly arising from the actions or inactions of the Developer (or if other persons acting on its behalf or under its direction or control) under this Agreement, or the transactions contemplated hereby or the acquisition, construction, installation, ownership, and operation of the Development; provided, that this indemnification shall not apply to the warranties made or obligations undertaken by Authority in this Agreement. Section 10.4 Limitation. All covenants, stipulations, promises, agreements and obligations of the Authority, or the Developer contained in this Agreement shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Authority or the Developer, respectively, and not of any governing body member, officer, agent, servant or employee of the Authority, the City or the Developer in the individual capacity thereof. 1267737v6 ARTICLE XI EVENTS OF DEFAULT AND DAMAGES Section 11.1 Events of Default Defined. Subject to applicable cure periods, 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 any one or more of the following events: Section 11.2 Developer Events of Default. The following shall be Events of Default for the Developer: (a) The proceeds of the Construction Loan Mortgage are not available for disbursement, subject only to standard construction disbursement provisions, for the construction of the Minimum Improvements within sixty (60) days of the Closing Date; or (b) the Developer shall fail to begin construction of the Minimum Improvements within 60 days after Closing and, subject to Unavoidable Delays, to proceed with due diligence to complete the Minimum Improvements within eighteen (18) months after 21 EDA RESOLUTION NO. 2001-12 Closing, all in conformity with this Agreement, and such failure to begin, or proceed with due diligence to complete, the construction of the Minimum Improvements shall not be cured within 30 days after written notice to do so. Notwithstanding the foregoing, if the default reasonably requires more than thirty (30) days to cure, such default shall not constitute an Event of Default, provided that the curing of the default is promptly commenced upon receipt by the Developer of the notice of the default, and with due diligence is thereafter continuously prosecuted to completion and is completed within a reasonable period of time, and provided that Developer keeps the Authority well informed at all times of its progress in curing the default; provided in no event shall such additional cure period extend beyond ninety (90) days; or (c) the Developer shall default in or violate its obligations with respect to the construction of the Minimum Improvements (including the nature and the date for the completion thereof), or shall abandon or substantially suspend construction work, and any such default, violation, abandonment or suspension is not cured, ended or remedied within thirty (30) days after written demand by the Authority so to do. Notwithstanding the foregoing, if the default reasonably requires more than thirty (30) days to cure, such default shall not constitute an Event of Default, provided that the curing of the default is promptly commenced upon receipt by the Developer of the notice of the default, and with due diligence is thereafter continuously prosecuted to completion and is completed within a reasonable period of time, and provided that Developer keeps the Authority well informed at all times of its progress in curing the default; provided in no event shall such additional cure period extend beyond ninety (90) days; or (d) there is, in violation of this Agreement, any conveyance or other transfer of the Development Property or any part thereof, and such violation is not cured within thirty (30) days after written demand by the Authority to the Developer; or (e) failure by Developer to observe or perform any other covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement, and the continuation of such failure for a period of thirty (30) days after written notice of such failure from any party hereto. Notwithstanding the foregoing, if the default reasonably requires more than thirty (30) days to cure, such default shall not constitute an Event of Default, provided that the curing of the default is promptly commenced upon receipt by the Developer of the notice of the, default, and with due diligence is thereafter continuously prosecuted to completion and is completed within a reasonable period of time, and provided that Developer keeps the Authority well informed at all times of its progress in curing the default; provided in no event shall such additional cure period extend beyond ninety (90) days; or (f) the Developer shall (i) file any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act of 1978, as amended, or under any similar Federal or State law; or (ii) make an assignment for the benefit of its creditors; or (ii) become insolvent or adjudicated a bankrupt; or if a petition or answer proposing the adjudication of Developer, 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 Developer, or of the Development, or part thereof, shall be appointed in any 1267737v6 22 EDA RESOLUTION NO. 2001-12 proceeding brought against Developer, and shall not be discharged within ninety (90) days after such appointed, or if Developer shall consent to or acquiesce in such appointment. Section 11.3 Authority Events of Default. The failure of the Authority to observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement, and the continuation of such failure for a period of thirty (30) days after written notice of such failure from any party hereto shall be an Event of Default for the Authority. Notwithstanding the foregoing, if the default reasonably requires more than thirty (30) days to cure, such default shall not constitute an Event of Default, provided that the curing of the default is promptly commenced upon receipt by the Authority of the notice of the default, and with due diligence is thereafter continuously prosecuted to completion and is completed within a reasonable period of time, and provided that the Authority keeps the Developer well informed at all times of its progress in curing the default; provided in no event shall such additional cure period extend beyond ninety (90) days. Section 11.4 Authority Remedies on Default. Whenever any Event of Default occurs by the Developer, the Authority may take any one or more of the following actions: (a) Suspend performance under this Agreement until it receives assurances from the Developer, deemed adequate by the Authority, that the Developer will cure its default and continue its performance under this Agreement. (b) Withhold the Certificate of Completion and/or the Certificate of Release of Forfeiture. 4.11 hereof. (e) Take whatever action at law or in equity may appear necessary or desirable to the Authority to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant of the Developer under this Agreement. Section 11.5 Revesting Title in the Authority. If, subsequent to conveyance of the Development Property to the Developer, and before issuance of the Certificate of Release of Forfeiture pursuant to Section 4.5, a Developer Event of Default occurs and is not cured within the cure period allowed, then the Authority shall have the right to re -enter and take possession of the Development Property and to terminate and to revest in the Authority the estate conveyed by the Deed to the Developer, it being the intent of this Agreement that the conveyance or transfer of the Development Property to the Developer shall be conditioned on the Developer's performance hereunder, and that upon the occurrence of an Event of Default by the Developer, all the rights and interest in and to the Development Property conveyed to the Developer, and that all rights and interests of the Developer, and any assigns or successors in interest to and in the Development Property shall revert to the Authority. 1267737v6 (c) The Authority may cancel and terminate this Agreement. (d) The Authority may draw on the Letter of Credit provided under Section 23 1 EDA RESOLUTION NO. 2001-12 Section 11.6 Developer Remedies on Default. Whenever any Event of Default occurs by the Authority, the Developer may take whatever action at law or in equity may appear necessary or desirable to the Developer to enforce performance and observance of any obligation, agreement, or covenant of the Authority under this Agreement, provided however, nothing in this Agreement shall entitle the Developer to make any claim against the Authority for any damages whatsoever. Section 11.7 No Remedy Exclusive. No remedy herein conferred upon or reserved to the Authority is intended to be exclusive of any other available remedy or remedies unless otherwise expressly stated, 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 Developer 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 XIII. Section 11.8 No Additional Waiver Implied by One Waiver. If 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 11.9 Reimbursement of Attorneys' Fees. If the Developer shall default under any of the provisions of this Agreement, the Authority shall employ attorneys or incur other reasonable expenses for the collection of payments due hereunder, or for the enforcement of performance or observance of any obligation or agreement on the part of the Developer contained in this Agreement, the Developer will on demand therefor reimburse the Authority for the reasonable fees of such attorneys and such other reasonable expenses so incurred. Section 12.1 Conflicts of Interest. No member of the Board or other official of the Authority shall have any financial interest, direct or indirect, in this Agreement, the Development Property or the Minimum Improvements, or any contract, agreement or other transaction contemplated to occur or be undertaken thereunder or with respect thereto, nor shall any such member of the governing body or other official participate in any decision relating to the Agreement which affects his or her personal interests or the interests of any corporation, partnership or association in which he or she is directly or indirectly interested. No member, official or employee of the Authority shall be personally liable to the Authority in the event of any default or breach by Developer or successor or on any obligations under the terms of this Agreement. 1267737v6 ARTICLE XII ADDITIONAL PROVISIONS 24 EDA RESOLUTION NO. 2001-12 Section 12.2 Real Estate Agents. The Authority and the Developer each represents that it has not retained any broker in connection with the transactions contemplated hereby. The Authority and the Developer each hereby agree to indemnify the other from any real estate or other sales commission or fee payable to any other broker hired or engaged by the indemnifying party in respect of the transactions contemplated by this Agreement. Section 12.3 Titles of Articles and Sections. Any titles of the several parts, articles and Sections of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 12.4 Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand or other communication under this Agreement by any party to any other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally, and in the case of Developer, is addressed to or delivered personally to Developer at 12 South Sixth Street, Suite 715, Minneapolis, Minnesota 55412, in the case of the Authority, is addressed to or delivered personally to the Economic Development Authority of Brooklyn Center, 6301 Shingle Creek Parkway, Brooklyn Center, Minnesota 55430 -2199, Attention: Executive Director, or at such other address with respect to any such party as that party may, from time to time, designate in writing and forward to the other, as provided in this Section. Section 12.5 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 12.6 Law Governing. This Agreement will be governed and construed in accordance with the laws of the State of Minnesota. Section 12.7 Consents and Approvals. In all cases where consents or approvals are required hereunder, such consents or approvals shall not be unreasonably conditioned, delayed or withheld. All consents or approvals shall be in writing in order to be effective. Section 12.8 Representatives. Except as otherwise provided herein, all approvals and other actions required of or taken by the Authority shall be effective upon action by the Authority Representative. All actions required of or taken by Developer shall be effective upon action by a duly authorized officer of the respective party. Section 12.9 Superseding Effect. This Agreement reflects the entire agreement of the parties with respect to the development of the Development, and supersedes in all respects all prior agreements of the parties, whether written or otherwise, with respect to the development of the Development. Section 12.10 Relationship of Parties. Nothing in this Agreement is intended, or shall be construed, to create a partnership or joint venture among or between the parties hereto, and the rights and remedies of the parties hereto shall be strictly as set forth in this Agreement. Section 12.11 Mediation. All claims, disputes or other matters in question between the parties to this Agreement arising out of or relating to this Agreement or breach thereof, shall be 1267737x6 25 1 EDA RESOLUTION NO. 2001-12 referred to non binding mediation before, and as a condition precedent to, the initiation of any legal action hereof, provided for herein. Each party agrees to participate in up to four hours of mediation. The mediator shall be selected by the parties, or if the parties are unable to agree on a mediator then any party can request the administrator of the Hennepin County District Court Civil ADR Program and/or similar person, to select a person from its list of qualified neutrals. The mediation shall be attended by employees or agents or each party having authority to settle the dispute. All expenses related to the mediation shall be borne by each party, including without limitation, the costs of any experts or legal counsel. All applicable statutes of limitations and all defense based on the passage of time are tolled while the mediation procedures are pending, and for a period of thirty (30) days thereafter. Section 12.12 Venue. All matters, whether sounding in tort or in contract, relating to the validity, construction, performance, or enforcement of this Agreement shall be controlled by and determined in accordance with the laws of the State of Minnesota, and the Developer agrees that all legal actions initiated by the Developer or Authority with respect to or arising from any provision contained in this Agreement shall be initiated, filed and venued exclusively in the State of Minnesota, Hennepin County, District Court and shall not be removed therefrom to any other federal or state court. Section 12.13 Provisions Surviving Rescission or Expiration. Sections 10.3 and 11.9 shall survive any rescission, termination or expiration of this Agreement with respect to or arising out of any event, occurrence or circumstance existing prior to the date thereof. Section 12.14 Time of Essence. Time is of the essence for the observance and performance of the parties' respective obligations and duties under this Agreement. 1267737v6 26 EDA RESOLUTION NO. 2001-12 IN WITNESS WHEREOF, the Authority, the City and Developer have caused this Agreement to be duly executed in their names and on their behalf, all on or as of the date .first above written. STATE OF MINNESOTA ss COUNTY OF HENNEPIN The foregoing instrument was acknowledged before me this day of 2001, by the Executive Director, of the Economic Development Authority of Brooklyn Center, a body corporate and politic organized and existing under the Constitution and laws of the State of Minnesota, on behalf of said Authority. 1267737v6 Notary Public 27 ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER By Executive Director EDA RESOLUTION NO. 2001-12 STATE OF MINNESOTA COUNTY OF HENNEPIN ss The foregoing instrument was acknowledged before me this day of 2000, by the of a on behalf of said corporation. This instrument drafted by: Briggs and Morgan, P.A. (MMD) 2200 First National Bank Building Saint Paul, MN 55101 -1396 1267737v6 Notary Public 28 By: Its: EDA RESOLUTION NO. 2001-12 EXHIBIT A LEGAL DESCRIPTION OF DEVELOPMENT PROPERTY f EDA RESOLUTION NO. 2001-12 EXHIBIT A Lots 10 14, parts. of Lots 8 and 9, Block 1; Lots 1 5, 9 14, 16 18, parts of lots 6 8, and part of Lot 15, Block 2 Lane's Brooklyn Center Addition, Hennepin County, Minnesota. This property is more commonly described as the northeast quadrant of 69 Avenue North and Brooklyn Boulevard. EDA RESOLUTION NO. 2001-12 WHEREAS, the Economic Development Authority of Brooklyn Center (the "Grantor a public body corporate and politic, by a Deed recorded in the Office of the County Recorder or the Registrar of Titles in and for the County of Hennepin and State of Minnesota, as Document Number has conveyed to a (the "Grantee in the County of Hennepin and State of Minnesota, the following legally described property to wit: (the "Development Property") and EXHIBIT B CERTIFICATE OF COMPLETION WHEREAS, said Deed incorporated and contained certain covenants and restrictions in a Development Agreement executed by and between the Grantor and the Grantee dated 2001 (the "Development Agreement and WHEREAS, the Grantee has to the present date 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 construction of that portion of the Minimum Improvements has been completed and the above covenants and conditions in said Development Agreement of the Grantee with respect to the construction of the Minimum Improvements have been performed by the Grantee and that the County Recorder or the Registrar of Titles in and for the County of Hennepin and State of Minnesota is hereby authorized to accept for recording and to record the filing of this instrument, to be a conclusive determination of the satisfaction of the obligations of the Grantee with respect to the construction of the Minimum Improvements. Thereafter any remaining obligations under the Development Agreement relating to the Development Property shall be solely contractual obligations of the Grantee, its successors and assigns and shall not run with nor be a lien against the Development Property. EDA RESOLUTION NO. 2001-12 IN WITNESS WHEREOF, the Authority has caused this Certificate of Completion to be executed with by its duly authorized officer as of the day of 2001. STATE OF MINNESOTA SS COUNTY OF HENNEPIN The foregoing instrument was acknowledged before me this day of 2001, by the Executive Director of the Economic Development Authority of Brooklyn Center, a body corporate and politic organized and existing under the Constitution and laws of the State of Minnesota, on behalf of said Authority. 1267737v6 ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER By: Its: Executive Director Notary Public B -2 EDA RESOLUTION NO. 2001-12 WHEREAS, the Economic Development Authority of Brooklyn Center (the "Grantor"), a public body corporate and politic, by a Deed recorded in the Office of the County Recorder or the Registrar of Titles in and for the County of Hennepin and State of Minnesota, as Document Number has conveyed to (the "Grantee in the County of Hennepin and State of Minnesota, the following legally described property to wit: WHEREAS, said Deed incorporated and contained certain covenants and restrictions, the breach of which by the Grantee, its successors and assigns, would result in a forfeiture and right of re -entry by the Grantor, its successors and assigns, said covenants and restrictions being set forth in said Deed and in a Development Agreement executed by and between the Grantor and the Grantee dated 2001 (the "Development Agreement and WHEREAS, the Grantee has to the present date 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 the conditions required to be satisfied by the Grantee under Section 4.5 of the Development Agreement have been satisfied by the Grantee therein and that the provisions for forfeiture of title and right to reentry for breach of condition subsequent by the Grantor, contained therein, are hereby released absolutely and forever insofar as they apply to the land described herein, and the County Recorder or the Registrar of Titles in and for the County of Hennepin and State of Minnesota is hereby authorized to accept for recording and to record the filing of this instrument, to be a conclusive determination of the 1267737v6 EXHIBIT C CERTIFICATE OF RELEASE OF FORFEITURE C -1 1 EDA RESOLUTION NO. 2001-12 satisfactory termination of the covenants and conditions of the contract referred to herein which would result in a forfeiture by the Grantee, its successors and assigns, and right of re -entry in the Grantor, its successors and assigns, as set forth in said Deed, and that said Deed shall otherwise remain in full force and effect. IN WITNESS WHEREOF, the Authority has caused this Certificate of Release of Forfeiture to be executed with by its duly authorized officer as of the day of 2001. ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER By: Its: Executive Director STATE OF MINNESOTA SS COUNTY OF HENNEPIN The foregoing instrument was acknowledged before me this day of 2001, by the Executive Director of the Economic Development Authority of Brooklyn Center, a body corporate and politic organized and existing under the Constitution and laws of the State of Minnesota, on behalf of said Authority. Notary Public Corporation Partnership or Limited Liability Company to Corporation, Partnership or Limited Liability Company No delinquent taxes and transfer entered; Certificate of Real Estate Value filed not required Certificate of Real Estate Value No. County Auditor By Deputy STATE DEED TAX DUE HEREON: Date: 2001 (Reserved for recording data) EDA RESOLUTION NO. 2001-12 1267737v6 EXHIBIT E QUIT CLAIM DEED FOR VALUABLE CONSIDERATION, the Economic Development Authority of Brooklyn Center, a public body corporate and politic (the "Grantor hereby conveys and quitclaims to a (the "Grantee the real property in Hennepin County, Minnesota, described as follows (the "Property"): See attached Exhibit A together with all hereditaments and appurtenances belonging thereto (the "Property"). Grantor's delivery of this Deed and conveyance of title, and Grantee's acceptance of this Deed and title to the Property, are expressly subject to: (1) the terms and conditions and the rights of the Grantor and the obligations of the Grantee under that certain Development Agreement by and between Grantor and Grantee dated December 2000 (the "Development Agreement including without limitation the limitation on the issuance of building permits as set forth in Section 4.2, and the reversionary provisions of Section 11.5; (2) reservation of minerals and mineral rights; (3) real estate taxes and special assessments due and payable in 2001 and subsequent years; (4) applicable zoning laws and ordinances and all other local, state, regional and federal laws and regulations; (5) all easements, covenants, conditions and restrictions of record, if any; and (6) all easements and rights -of -way shown in any recorded plat. Promptly after the conditions set forth in Section 4.5 of the Development Agreement have been satisfied, the Grantor will furnish the Grantee with a Certificate of Release of Forfeiture in the form attached to this Deed as Exhibit B. Such certification by the Grantor shall be (and it shall be so provided in the certification itself) a conclusive determination of satisfaction of the requirements of Section 4.5 of the Development Agreement, it being the intention of the parties that upon the E -1 1 EDA RESOLUTION NO. 2001-12 granting and filing of the Certificate of Release of Forfeiture that the right of reentry contained in this Deed, be forever released and terminated as to the Property. In the event that, prior to the execution and delivery of the Certificate of Release of Forfeiture, the Grantee herein shall default under Section 11.2 of the Development Agreement and fail to cure such default within the period and in the manner stated in Section 11.2, then the Grantor shall have the right to re -enter and take possession of the property and to terminate and revest in the Grantor the estate conveyed by this Deed to the Grantee, its assigns or successors in interest, in accordance with the terms of the Agreement. Grantee covenants and agrees that no discrimination because of race or religion, political or other affiliation will be allowed or permitted to occur in the use, sale rental of any portion of the Property. It is intended and agreed that the above and foregoing agreement and covenants shall be covenants running with the land, and that they shall, in any event, and without regard to technical classification or designation, legal or otherwise, and except only as otherwise specifically provided in this Deed, be binding, to the fullest extent permitted by law and equity for the benefit and in favor of, and enforceable by, the Grantor, its successors and assigns, and any successor in interest to the Property, or any part thereof against the Grantee, its successors and assigns, and every successor in interest to the Property, or any part thereof or any interest therein, and any party in possession or occupancy of the Property or any part thereof. The Grantor does not know of any wells located on the described real property. ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER 1267737v6 By: Its: E -2 EDA RESOLUTION NO. 2001-12 STATE OF MINNESOTA ss COUNTY OF HENNEPIN The foregoing was acknowledged before me this day of 2001, by the of the Economic Development Authority of Brooklyn Center, a public body corporate and politic, on behalf of said body. NOTARIAL STAMP OR SEAL (OR OTHER TITLE OR RANK) SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT THIS INSTRUMENT WAS DRAFTED BY: Briggs and Morgan, P.A. (MMD) W2200 First National Bank Building 332 Minnesota Street St. Paul, MN 55101 Tax statements for the real property described in this instrument should be sent to (include name and address of Grantee): EDA RESOLUTION NO. 2001-12 EXHIBIT F PERMITTED ENCUMBRANCES 1. Real estate taxes due and payable in 2002 and subsequent years. 2. All easements, covenants, conditions and restrictions of record, if any. 3. All easements and rights -of -way shown in any recorded plat. 4. Reservation of minerals and mineral rights. 5. Applicable zoning laws and ordinances and all other local, state, regional and federal laws and regulations. Those obligations, restrictions and conditions as provided in the Development Agreement. EDA RESOLUTION NO. 2001-12 EXHIBIT G BUSINESS SUBSIDY REPORT Report as Recipient of Business Subsidy This report is required by Section 4.10 of that certain Development Agreement, dated as of 2001 (the "Agreement among the Economic Development Authority of Brooklyn Center, Minnesota (the "Authority and (the "Developer"), and as required by Minnesota Statutes, Section 116J.994, Subdivision 7, as amended. Capitalized terms which are used but not otherwise defined in this report have the meanings given to those under the Agreement. The Authority has under the Agreement granted a certain business subsidy to the Developer. Under the Agreement, the Developer is required to file reports with the Executive Director (1) on March 1 of each year, beginning with the March 1 immediately following the date of the issuance of a Certificate of Occupancy for the Project, being referred to herein as the Benefit Date, and (2) within 30 days after the Compliance Date, namely the date which is two years after the Benefit Date. Each March 1 report is required to report on the prior calendar year, and each other report shall report on the period since the last reporting period. The Developer's Job Goals under Section 4.10 of the Agreement are to create at the Project 20 permanent full-time equivalent jobs within two years from the Benefit Date. These jobs are required to have a wage of at least $7.00 per hour, exclusive of benefits. The Developer hereby certifies to the Authority the following: (1) As provided in the Agreement, the total fair market value of the Subsidy is estimated to be $730,000, the type of Subsidy is the sale of real property at less than its fair market value. The public purposes of the subsidy are to further development of the City's commercial and tax base and to create jobs. (2) The hourly wage of each permanent full -time equivalent job which has been created by the Developer at the Project since the Benefit Date, with separate bands of wages, are as follows: 1267737v6 Number of Jobs G -1 Wage Levels Per Hour EDA RESOLUTION NO. 2001-12 1267737v6 (3) The cost of health insurance provided by the Developer for the above referenced jobs, separated by bands of wages, is as follows: Number of Jobs G -2 By: Its: Wage Levels Per Hour (4) If the Developer has not already met the Job Goals, it reasonably expects that it will meet those goals on or before 200 is taking the following steps to meet the Job Goals: (5) The Developer has no parent corporations. (6) Other than the subsidy provided by the Authority under the Agreement, there are no other State of Minnesota or "local government agency" grants of subsidy to the Developer for the Project. (7) The Developer hereby agrees to provide upon request such other information as the Commissioner of the Department of Trade and Economic Development of the State of Minnesota may request the Authority or the Developer to provide or as may be required by the Subsidy Law. (8) The Developer represents that it or its tenants have continuously occupied the Project since its completion, that the Developer has continuously owned the Project, and the Developer expects said ownership to continue for the foreseeable future. (9) The Developer is not in default on the date hereof of its obligations under any subsidy agreement under the Subsidy Law. EDA RESOLUTION NO. 2001-12 1267737v6 G -3 This report is to be filed with: Economic Development Authority of Brooklyn Center 6301 Shingle Creek Parkway Brooklyn Center, MN 55430 -2199 Attn: Executive Director EDA RESOLUTION NO. 2001-12 1267737v6 EXHIBIT H DEPICTION OF OTHER PAD SITES H -1