HomeMy WebLinkAbout2009 10-26 EDAP EDA MEETING
City of Brooklyn Center
October 26, 2009 AGENDA
1. Call to Order
The EDA requests that attendees turn off cell phones and pagers during the meeting. A
copy of the full City Council packet, including EDA (Economic Development Authority),
is available to the public. The packet ring binder is located at the front of the Council
Chambers by the Secretary.
2. Roll Call
3. Approval of Agenda and Consent Agenda
—The following items are considered to be routine by the Economic Development
Authority (EDA) and will be enacted by one motion. There will be no separate
discussion of these items unless a Commissioner so requests, in which event the item will
be removed from the consent agenda and considered at the end of Commission
Consideration Items.
a. Approval of Minutes
1. October 12, 2009 Regular Session
e 4. Commission Consideration Items
a. Resolution Authorizing Authority Staff to Acquire Certain Foreclosed Homes
within the City and to Execute all Instruments and Contracts Related Thereto
Requested Commission Action:
Motion to adopt resolution.
b. Resolution Authorizing the Execution of a Third Amendment to Real Estate
Option Agreement (FBI Regional Field Office)
Requested Commission Action:
Motion to adopt resolution.
5. Adjournment
EDA Agenda Iten�.1' o a
7
MINUTES OF THE PROCEEDINGS OF THE
ECONOMIC DEVELOPMENT AUTHORITY
OF THE CITY OF BROOKLYN CENTER
IN THE COUNTY OF HENNEPIN AND THE
STATE OF MINNESOTA
REGULAR SESSION
OCTOBER 12, 2009
CITY HALL COUNCIL CHAMBERS
1. CALL TO ORDER
The Brooklyn Center Economic Development Authority (EDA) met in Regular Session called to
order by President Tim Willson at 8:16 p.m.
2. ROLL CALL
President Tim Willson and Commissioners Kay Lasman, Tim Roche, Dan Ryan, and Mark
Yelich. Also present were Executive Director Curt Boganey, Director of Business and
Development Gary Eitel, Assistant City Manager/Director of Building and Community
Standards Vickie Schleuning, City Attorney Charlie LeFevere, and Carol Hamer, TimeSaver Off
Site Secretarial, Inc.
3. APPROVAL OF AGENDA AND CONSENT AGENDA
Commissioner Lasman moved and Commissioner Ryan seconded approval of the Agenda and
Consent Agenda, and the following item was approved:
3a. APPROVAL OF MINUTES
1. September 28, 2009 Regular Session
2. September 28, 2009 Executive Session
Motion passed unanimously.
4. COMMISSION CONSIDERATION ITEMS
4a. RESOLUTION NO. 2009 -16 AUTHORIZING THE ACQUISITION OF REAL
PROPERTY LOCATED AT 6045 BROOKLYN BOULEVARD IN CONNECTION
WITH THE REMOVE AND REBUILD PROGRAM AND APPROVING SALES
CONTRACT BETWEEN THE ECONOMIC DEVELOPMENT AUTHORITY OF
BROOKLYN CENTER AND HIGHLAND BANK
Executive Director Curt Boganey introduced the item. Director of Business and Development
Gary Eitel discussed the condition of the property located at 6045 Brooklyn Boulevard and stated
the purpose of the proposed resolution.
10/12/09 -1- DRAFT
It was noted that this purchase is in line with the planning of Brooklyn Boulevard for the past 10
to 12 years to upgrade the corridor and change the blight conditions. There was discussion on the
proposed purchase in comparison to other single family homes in this area. Mr. Eitel stated this
is a corner property and the acquisition will enable discussions with the 11 -unit Northbrook
Apartment building to the north. Staff is also pursuing the other two homes to the south of this
property; one is listed for $62,900, and the other is listed for $74,900. What is unique about this
property is that it is owned by a local bank, and the broker has worked with the City with a
signed purchase agreement. This is the beginning of acquisitions in this area; it will be seen
whether this carries further to the south.
There was discussion on the Land Use and Transportation Elements of the City's Comprehensive
Plan and the Brooklyn Boulevard Corridor Streetscape Amenities Study. It was noted that the
current use is not the highest and best use of the property.
There was discussion on the proposed winterization of the home and the possibility of relocating
the home to an empty lot. Mr. Eitel indicated that the home will be winterized and controlled
with the relocation option given to the EDA if it is feasible. He has been informed that moving
stucco homes is extremely difficult and expensive to repair after the fact. Mr. Eitel advised that
Hennepin County.
Northbrook A p ty
the driveway extension to Nort Apartments will be coordinated with H p
Commissioner Roche moved and Commissioner Yelich seconded adoption of RESOLUTION
Real Property Located at 6045 Brooklyn NO. 2009-16 Authorizing the Acquisition of Re p y Boulevard
in Connection with the Remove and Rebuild Program and Approving Sales Contract Between
the Economic Development Authority of Brooklyn Center and Highland Bank.
Motion passed unanimously.
5. ADJOURNMENT
Commissioner Roche moved and Commissioner Lasman seconded adjournment of the Economic
Development Authority meeting at 8:31 p.m.
Motion passed unanimously.
10/12/09 -2- DRAFT
t
IED-A. Agenda Item No,' 4a
f
4
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1.
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EDA COUNCIL ITEM MEMORANDUM
TO: Curt Boganey, City Manager
FROM: Tom Bublitz, EDA/HRA Specialist
r
THROUGH: Gary Eitel, Director of Business Development Director LIV
DATE: October 22, 2009
SUBJECT: Resolution Authorizing Authority Staff to Acquire Certain Foreclosed
Homes Within the City and to Execute all Instruments and Contracts
Related Thereto
Recommendation:
Staff is recommending approval of Resolution Authorizing Authority Staff to Acquire Certain
Foreclosed Homes Within the City and to Execute all Instruments and Contracts Related Thereto
Background:
One of the goals of the City's Remove and Rebuild Program is to acquire blighted and distressed
properties, demolish the structures and return the properties to an enhanced condition compatible
with the surrounding neighborhood. The intent of this resolution is to have in place a mechanism
to acquire vacant /foreclosed properties in the city that are distressed and blighted. The land will
be held by the EDA until an appropriate reuse can be determined that will compliment the
surrounding neighborhood, including uses such as residential redevelopment, open space, public
facilities and other eligible uses, depending on the source of revenue used to acquire the blighted
property.
In the past, EDA staff has brought specific properties to the Board and requested authority to
purchase the properties for demolition and redevelopment. The City has successfully completed
numerous scattered site redevelopments, throughout the city, in this manner. In the current
climate of foreclosures and vacant properties, it has become apparent that, in order to work with
bank owned properties and secure the homes to accomplish the objective of acquiring blighted
properties, there is a need to be able to act more quickly than previous procedures have allowed.
Asset managers representing bank owned properties are typically not willing to wait on an offer
for several weeks to allow the traditional EDA process of acquiring properties to occur. As a
result, staff is proposing the EDA Executive Director, working with the EDA's attorney, be
given authority to acquire certain foreclosed/vacant properties within very specific requirements
as described in the proposed resolution under consideration. This authority would allow the
Executive Director to negotiate and execute the purchase of properties within specific guidelines
contained in the resolution. EDA staff would then report back each month to the EDA Board
with a status report of the purchase activity.
The guidelines for acquisition of properties by the EDA Executive Director would include the
following:
Properties must be registered as vacant.
Properties would be purchased either with TIF funds or federal Neighborhood
Stabilization Program (NSP) funds.
The property would be determined to be blighted as defined by the Minnesota Housing
Finance Agency in its application to the Department of Housing and Urban Development
(HUD) for NSP funding.
The purchase price could not be more than 65 percent of Hennepin County's latest
Estimated Market Value for the property and could not exceed $80,000.
Prior to the acquisition of property, staff would conduct a due diligence investigation to
protect the EDA's interest with regard to purchase of the property.
Budget Issues:
Properties purchased under authority of this resolution must be purchased with either NSP or TIF
funds.
Commissioner introduced the following resolution and
moved its adoption:
EDA RESOLUTION NO.
RESOLUTION AUTHORIZING AUTHORITY STAFF TO ACQUIRE CERTAIN
FORECLOSED HOMES WITHIN THE CITY AND TO EXECUTE ALL
INSTRUMENTS AND CONTRACATS RELATED THERETO
WHEREAS, the Economic Development Authority of Brooklyn Center (`EDA
has established various housing programs including its Remove and Rebuild Program, an
acquisition and demolition program to remove blighted, distressed and unmarketable properties
and return the properties to an enhanced condition and use, compatible with the neighborhood
(the "Program and
WHEREAS, the Program is funded with funds from the Tax Increment District #3
"TIF Funds and
WHEREAS, in order to expand the effectiveness of the Program, the EDA wishes to
directly purchase certain foreclosed properties to demolish and hold the lots for future development,
rehabilitate or resell to private entities for development or rehabilitation; and
WHEREAS, it is the desire of the EDA to establish certain standards and conditions
for such acquisitions and to authorize its Executive Director to proceed therewith without specific
EDA approval of each transaction.
NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority
in and for the City of Brooklyn Center:
1. That the Executive Director, with the assistance of EDA's legal counsel, is
hereby authorized to enter into purchase agreements and acquire in the name
of the EDA up to ten (10) single family, vacant, foreclosed homes (the
"Properties on the conditions that:
a. All properties are registered as vacant properties with the City of
Brooklyn Center; and
b. The Properties are each acquired with Neighborhood Stabilization
Program Stabilization Program "NSP Funds or TIF Funds, and are
eligible for use of such funding; and
C. Each property is a foreclosed property acquired from a lender or a
lender's designee; and
d. The Properties have been vacant for at least 30 days prior to entering
into a purchase agreement; and
EDA RESOLUTION NO.
e. The Property is determined to be blighted as defined by the
Minnesota Housing Finance Agency in its application to the US
Department of Housing and Urban Development (HUD) for NSP
funding as follows:
A blighted structure is one which, by reason of dilapidation,
obsolescence, overcrowding, faulty arrangement or design,
lack of ventilation, light, and sanitary facilities, excessive
land coverage, deleterious land use, or obsolete layout, or
any combination of these or other factors, is detrimental
to the safety, health, morals, or welfare of the community: and
f. The purchase price is not more than 65 percent of Hennepin County's
latest Estimated Market Value for the Property and does not exceed
$80,000; and
g. Prior to the acquisition of each property, staff conducts appropriate
due diligence to protect the EDA's interest.
2. That for purposes of this resolution, "single family" includes any property
with fewer than three units.
3. That the Executive Director is authorized to execute such documents as shall
be required in order to carry out the delegation provided in paragraph 1
hereof.
4. That the Executive Director shall report the acquisition of any Property
pursuant to this Resolution at the next regular EDA meeting.
5. That disposition of acquired Properties shall be only by action of the EDA.
6. That the authority to enter into new purchase agreements granted hereby shall
expire twelve (12) months from the date of this Resolution.
October 26, 2009
Date President
The motion for the adoption of the foregoing resolution was duly seconded by Commissioner
and upon vote being taken thereon, the following voted in favor thereof:
and the following voted against the same:
whereupon said resolution was declared duly passed and adopted.
DA Agenda Item No.. 4b
f
',a
EDA COUNCIL ITEM MEMORANDUM
DATE: October 20, 2009
TO: Curt Boganey, City Manager
FROM: Gary Eitel, Director of Business and Development
SUBJECT: Resolution Authorizing the Execution of a Third Amendment to Real Estate Option
Agreement (FBI Regional Field Office)
COUNCIL ACTION REQUESTED:
Motion to adopt Resolution Authorizing the Execution of a Third Amendment to Real Estate Option
Agreement.
BACKGROUND:
On February 25, 2008, the EDA moved to adopt Resolution No. 2008 -02, which authorized the
execution of an assignable option purchase agreement with the General Service Administration
(GSA) for a parcel of land not to exceed 8.57 acres in area that included the following properties:
Tract A, RLS No. 1477 (the former Days Inn Site) and the northern portion of Lot 2, Block 1
Richardson Park 2nd Addition the former Cracker Barrel Site)
The option agreement was executed on March 19, 2008 and included an effective period of 15
months (expiration date June 17, 2009).
On April 30, 2009, the GSA publicly announced that Barry Real Estate Company had been
selected to be the developer for the design, build, and leasing of the FBI Regional Field Office.
On June 8, 2009, the EDA moved to adopt Resolution No. 2009 -10, A Resolution Authorizing
Execution of a First Amendment to Restate Option Agreement which acknowledged the
assignment from the GSA to Barry Minneapolis, LLC (Barry Real Estate Companies) and
extended the term of the option agreement until September 17, 2009.
On September 14, 2009, the EDA moved to adopt Resolution No. 2009 -15 "A Resolution
Authorizing Execution of a Second Amendment to Restate Option Agreement" which provided
an extension of the Term of the Option to October 16, 2009. The additional time allowed the
vacation of old drainage and utility easements and the opportunity to resolve title issues
associated with the previous subdivisions of Richardson Park Industrial Park and Richardson
Park 2 Addition.
i
Real Estate Option Agreement:
The Third Amendment to the Real Estate Option Agreement provides technical corrections and
procedural revisions to the draft Development Agreement attached to the March 19, 2008 Option
Agreement.
Additionally, it includes changes to the Development Agreement that respond to issues the
developer has experienced in securing financing for this project:
The recitals includes a statement that the GSA has indicated that pursuant to its intended
use of the Development Property following development, at least 280 full -time employee
positions will be provided by the development contemplated hereunder,
The term sublessee has been included to identify the Ferderal Bureau of Investigation
(FBI) Minneapolis Field Office, an agency of the United States Government.
Business Subsidy Provisions of Section 4.9 have been revised form 280 to 200 full time
equivalent permanent employee positions within two years of the benefit date for
purposes of complying with the Job Goals of the Business Subsidy Act. Also, language
has been added to clarify the reporting and satisfaction of this State requirement.
Language has been added relating to the right of reversion and position of the
Authority/EDA in the event of a foreclosure.
Attached are copies of the following documents submitted by Barry Minneapolis, LLC:
October 16, 2008 letter providing written notice of the Optionee's election to exercise the
Option.
Executed copy of the Third Amendment to the Real Estate Option Agreement.
Executed copy of the revised Development Agreement.
The Development Agreement provides for Barry Minneapolis LLC to close on the property
within 120 days from the execution of the agreement, to commence construction no later than
May 31, 2010 and to complete the minimum improvements no later than October 1, 2011.
Budget Issues:
There are no budget issues with this action.
Commissioner introduced the following resolution and
moved its adoption:
EDA RESOLUTION NO.
RESOLUTION AUTHORIZING EXECUTION OF A THIRD AMENDMENT
TO REAL ESTATE OPTION AGREEMENT (FBI REGIONAL FIELD
OFFICE)
WHEREAS, the Economic Development Authority of the City of Brooklyn
Center, Minnesota (the "Authority and the United States of America, acting by and through the
U.S. General Services Administration (the "GSA have heretofore entered into a Real Estate
Option Agreement (the "Option Agreement providing for the Authority's conveyance of
certain real property to GSA for the purpose of constructing office space containing
approximately 162,000 square feet of rentable space with a future onsite parking facility
structure having a minimum of 200 spaces (the "Project within the City of Brooklyn Center,
Minnesota (the "City and
WHEREAS, a proposed form of Development Agreement in connection with the
Project is attached as an exhibit to the Option Agreement (the "Development Agreement and
WHEREAS, by that certain Assignment of Option Agreement dated effective as
of June 19, 2009, the GSA assigned its rights under Option Agreement to Barry Minneapolis,
LLC (the "Developer and
WHEREAS, the Authority and the Developer previously entered into that certain
First Amendment to Real Estate Option Agreement dated effective as of June 19, 2009 for the
purpose of extending the term of the option granted in the Option Agreement; and
WHEREAS, the Authority and GSA previously entered into that certain Second
Amendment to Real Estate Option Agreement dated effective as of September 17, 2009 for the
purpose of further extending the term of the option granted in the Option Agreement; and
WHEREAS, the Authority and GSA desire to further amend the Option
Agreement, and the form of Development Agreement attached thereto, pursuant to a Third
Amendment to Real Estate Option Agreement (the "Amendment to revise the timing and
manner of the exercise of the option and related title and survey review and to make certain
amendments to the form of Development Agreement to be entered into by the parties upon
exercise of the option contained in the Option Agreement.
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the
Authority of Brooklyn Center, Minnesota, as follows:
1. The Board of Commissioners hereby approves the Amendment in
substantially the form submitted, and the Executive Director is hereby
authorized and directed to execute the Amendment on behalf of the
Authority.
EDA RESOLUTION NO.
2. The approval hereby given to the Amendment includes approval of such
additional details therein as may be necessary and appropriate and such
modifications thereof, deletions therefrom and additions thereto as may be
necessary and appropriate and approved by the Authority officials
authorized by this resolution to execute the Amendment. The execution of
the Amendment by the appropriate officer or officers of the Authority
shall be conclusive evidence of the approval of the Amendment in
accordance with the terms hereof.
October 26. 2009
Date President
The motion for the adoption of the foregoing resolution was duly seconded by commissioner
and upon vote being taken thereon, the following voted in favor thereof:
and the following voted against the same:
whereupon said resolution was declared duly passed and adopted.
s
REAL ESTATE COMPANIES
CHRISTIAN B. SCHOEN 404 601 -0843
CHIEF EXECUTIVE OFFICER CSCHOENa.BARRYCOMPANIES.COM
October 16, 2009
Via Electronic Mail and
Overniaht Delivery
Economic Development Authority
of Brooklyn Center
6301 Shingle Creek Parkway
Brooklyn Center, Minnesota 55430
Attention: Executive Director
Re: Real Estate Option Agreement dated March 19, 2008 (as amended the "Option
Agreement by and between the Economic Development Authority of Brooklyn
Center "Optionor and Barry Minneapolis, LLC "Optionee
Sir/Madam:
On behalf of Optionee and in accordance with Section 3(a) of the Option Agreement, this
letter shall serve as written notice of Optionee's election to exercise the Option. Transmitted
simultaneously herewith is the executed Third Amendment to Real Estate Option Agreement and
two (2) original counterparts of the Development Agreement.
We look forward to closing on the property for the development of the FBI facilities.
Sincerely
Christian B. Schoen
30 IVAN ALLEN JR BOULEVARD/SUITE 900/ATLANTA, GA 30308 Office: 404.601 .0880 fax: 404.601.0881
w ww. baryyrompRRW_t. CO M
THIRD AMENDMENT TO REAL ESTATE OPTION AGREEMENT
THIS THIRD AMENDMENT TO REAL ESTATE OPTION AGREEMENT (this
"Amendment is entered into effective as of October 41 2009 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 BARRY NIINNEAPOLIS, LLC, a Georgia limited liability company (the
"Developer
RECITALS
WHEREAS, the Authority and the UNITED STATES OF AMERICA, ACTING BY
AND THROUGH THE U.S. GENERAL SERVICES ADMINISTRATION (the "GSA
entered into that certain Real Estate Option Agreement dated effective as of March 19, 2008,
pursuant to which the Authority granted to the GSA an option to purchase certain property
located in Brooklyn Center, Minnesota for the purpose of constructing an approximately 162,000
square foot federal office facility and related parking facility.
WHEREAS, pursuant to that certain Assignment of Option Agreement dated effective as
of June 19, 2009, the GSA assigned its rights under the Option Agreement to Developer, who is
to exercise the option to purchase granted therein by delivering to the Authority, inter alia, a
certain Development Agreement in the form attached to the Option Agreement (the
"Development Agreement which Development Agreement sets forth the terms and
conditions of the sale of real property from the Authority to the Developer.
WHEREAS, the Authority and the Developer entered into that certain First Amendment
to Real Estate Option Agreement dated effective as of June 19, 2009, and that certain Second
Amendment to Real Estate Option Agreement dated effective as of September 17, 2009,
pursuant to each of which the original term of the option was extended (together with the original
Real Estate Option Agreement described above, the "Option Agreement
WHEREAS, pursuant to the terms of the Option Agreement, the GSA was to deliver to
the Authority an ALTA/ACSM Land Title Survey depicting and describing the Development
Property to be purchased (the "Survey and the Authority was to subsequently deliver to the
GSA a title insurance commitment for the Development Property (the "Commitment
WHEREAS, pursuant to the terms of the Option Agreement, the GSA was to review the
Commitment and related documents and make any title objections to the Authority within certain
time frames established in the Option Agreement; all such objections are to be resolved between
the parties prior to exercise of the option and all permitted encumbrances are to be described on
Exhibit D of the Development Agreement at the time of delivery thereof to the Authority in
connection with the option exercise.
WHEREAS, the GSA requested that the Developer perform the review of the
Commitment and Survey subsequent to the assignment of the GSA's rights under the Option
Agreement but prior to the execution and delivery of this Amendment and the Development
Agreement such that the Developer and Authority may determine the Permitted Encumbrances,
23400050
and the Authority has agreed to amend the Option Agreement and Development Agreement to
permit such review by Developer.
WHEREAS, the Survey and Commitment, as updated and/or revised pursuant to
dialogue between the Authority, the GSA and the Developer, have been delivered to the
Authority, GSA and Developer prior to the date hereof.
WHEREAS, the Developer has reviewed the Commitment, Survey and related
documents and the parties are in the process of performing certain curative acts and establishing
the Permitted Exceptions.
WHEREAS, the parties now desire to amend the terms of the Option Agreement and the
form of Development Agreement to reflect the above described revisions and the revised
requirements for Developer's exercise of the option.
WHEREAS, the parties have agreed to amend the Option Agreement and the form of
Development Agreement on the terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. Definitions. Capitalized terms not otherwise defined or amended in this
Amendment shall have the meaning(s) as set forth in the Option Agreement and Development
Agreement, as applicable.
2. Form of Development Agreement. The form of Development Agreement
attached as Exhibit B to the Option Agreement is hereby deleted in its entirety and replaced with
the form of Development Agreement attached as Exhibit B hereto.
3. Exercise of Option. Sections 3(b), 3(c), 3(d), 3(e) and 3(g) of the Option
Agreement are hereby deleted in their entirety.
Section 3(f) of the Option Agreement is hereby deleted and replaced with the following:
"Confirm (and complete, if necessary) the information and statements made in
Sections 4.9(f) and (g) of the Development Agreement."
Section 3(h) of the Option Agreement is hereby deleted and replaced with the following:
"Confirm the legal description contained in Exhibit A of the Development
Agreement conforms with the legal description of the portion of the Property
Developer intends to acquire (the "Development Property as depicted and
described on the Survey and Commitment."
23400050 -2-
Section 3(i) of the Option Agreement is hereby deleted and replaced with the
following:
"Complete Exhibit D of the Development Agreement pursuant to Section 3.6 of
the Development Agreement; and"
4. Title and Survev. Section 6 and Section 7 of the Option Agreement are hereby
amended such that the expiration of the periods described in Section 6 and Section 7 for the
GSA's review of title and survey matters are hereby waived; the review of the Commitment,
Survey and related title matters, and resolution thereof, shall be performed as provided in Section
3.6 of the Development Agreement.
5. No Further Modification of Avreements: Ratification. Except to the extent
modified herein, all other terms and provisions of the Option Agreement shall remain in full
force and effect. Except to the extent modified herein, the Option Agreement is hereby ratified
and affirmed in all respects by the Authority, the GSA, and Developer. If any conflict exists
between the terms and conditions of the Option Agreement and the terms and conditions of this
Amendment or the form of Development Agreement attached hereto, the terms and conditions of
this Amendment shall control.
6. Governing Law. This Amendment shall be construed and enforced in
accordance with the laws of the State of Minnesota.
7. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
23400050 -3-
IN WITNESS WHEREOF, the parties have executed this Amendment to be effective as
of the day and year first above written.
Authority: Developer:
ECONOMIC DEVELOPMENT BARRY MINNEAPOLIS, LLC,
AUTHORITY OF BROOKLYN a Georgia limite liab' ity company
CENTER,
a public body corporate and politic
organized and existing under the laws of the By:
State of Minnesota Name: t'4S4�`M-
Its:
By:
Name:
Its:
23400050 -4-
EXHIBIT B
DEVELOPMENT AGREEMENT BY AND BETWEEN ECONOMIC DEVELOPMENT
AUTHORITY OF BROOKLYN CENTER AND BARRY MINNEAPOLIS, LLC
[See attached.]
23400050
i
DEVELOPMENT AGREEMENT
BY AND BETWEEN
ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER
AND
BARRY MINNEAPOLIS, LLC
2009
2083895v11
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS 2
Section 1.1 Definitions
ARTICLE II REPRESENTATIONS AND WARR ANTIES 5
Section 2.1 Representations and Warranties of the Authority 5
Section 2.2 Representations and Warranties by the Developer 5
ARTICLE III CONVEYANCE OF DEVELOPMENT PROPERTY 7
Section 3.1 Purchase and Sale of Development Property 7
Section 3.2 Purchase Price 7
Section 3.3 Developer's Right to Inspect 7
Section 3.4 "As Is" Conveyance 7
Section 3.5 Acknowledgements by the Authority 7
Section 3.6 Subdivision; Title and Survey 8
Section 3.7 Acknowledgements by Developer 8
Section 3.8 Contingencies to Closing on Development Property 8
Section 3.9 Closing on the Development Property 9
Section 3.10 Authority Support for Other Projects I 1
Section 3.11 Option Agreement 11
Section 3.12 Voluntary Removal of Contaminated Soils .............................11
ARTICLE IV CONSTRUCTION OF MINIMUM IMPROVEMENTS .............................13
Section 4.1 Construction of Minimum Improvements .............................13
Section 4.2 Preliminary Plans .............................13
Section 4.3 Commencement and Completion of Construction .............................13
Section 4.4 Compliance with Environmental Requirements .............................14
Section 4.5 Additional Responsibilities of the Developer .............................14
Section 4.6 Certificate of Release of Forfeiture .............................14
Section 4.7 Completion .............................15
Section 4.8 Certain Approvals .............................15
Section 4.9 Business Subsidy Agreement .............................15
ARTICLE V NO PUBLIC IMPROVEMENTS .............................18
Section 5.1 No Public Improvements .............................18
ARTICLE VI CERTAIN FINANCING PROVISIONS .............................19
Section 6.1 Encumbrance of the Development Property .............................19
Section 6.2 Copy of Notice of Default to Mortgagee .............................19
Section 6.3 Mortgagee's Option to Cure Events of Default .............................19
Section 6.4 Defaults Under Mortgage .............................19
Section 6.5 Subordination of Agreement .............................19
ARTICLE VII INSURANCE AND CONDEMNATION 20
Section 7.1 Insurance 20
Section 7.2 Condemnation 21
ARTICLE VIII DEVELOPER COVENANTS 22
Section 8.1 Maintenance and Operation of the Development 22
2083895v11 _i_
TABLE OF CONTENTS
(continued)
Page
ARTICLE IX TRANSFER LIMITATIONS AND INDEMNIFICATION 23
Section 9.1 Representation as to Development; Limit on Transfer of
Ownership Interest in Developer 23
Section 9.2 Limitations on Transfer 23
Section 9.3 Indemnification 24
Section9.4 Limitation 24
ARTICLE X EVENTS OF DEFAULT AND REMEDIES 25
Section 10.1 Developer Events of Default 25
Section 10.2 Authority Events of Default 26
Section 10.3 Authority Remedies on Default 26
Section 10.4 Revesting Title in the Authority 27
Section 10.5 Developer Remedies on Default 27
Section 10.6 No Remedy Exclusive 27
Section 10.7 No Additional Waiver Implied by One Waiver 27
Section 10.8 Reimbursement of Attorneys' Fees 27
ARTICLE XI ADDITIONAL PROVISIONS 28
Section 11.1 Conflicts of Interest 28
Section 11.2 Real Estate Agents 28
Section 11.3 Titles of Articles and Sections 28
Section 11.4 Notices and Demands 28
Section 11.5 Counterparts .............................28
Section 11.6 Law Governing 28
Section 11.7 Consents and Approvals 28
Section 11.8 Representatives 28
Section 11.9 Superseding Effect .............................29
Section 11.10 Relationship of Parties 29
Section 11.11 Mediation .............................29
Section11.12 Venue 29
Section 11.13 Provisions Surviving Rescission or Expiration 29
Section 11.14 Time of Essence 29
Section 11.15 Modification .............................29
EXHIBIT A LEGAL DESCRIPTION OF DEVELOPMENT PROPERTY A -1
EXHIBIT B CERTIFICATE OF RELEASE OF FORFEITURE B -1
EXHIBIT C LIMITED WARRANTY DEED C -1
EXHIBIT D PERMITTED ENCUMBRANCES D -1
EXHIBIT E BUSINESS SUBSIDY REPORT E -1
EXHIBIT F REDEVELOPMENT PLAN ............................F -1
2083895v11 -11-
DEVELOPMENT AGREEMENT
THIS DEVELOPMENT AGREEMENT is made and entered into this day of
2009, 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 BARRY MINNEAPOLIS, LLC, a
Georgia 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.
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 granted an option to purchase the Development Property to the
United States of America and its assigns acting by and through the General Services
Administration (the "GSA pursuant to an Option Agreement dated as of March 19, 2008 (as
amended, the "Option Agreement").
WHEREAS, the Sublessee (as defined herein) has indicated that, pursuant to its intended
use of the Development Property following development, at least 280 full -time employee
positions will be provided by the development contemplated hereunder.
WHEREAS, the Developer has been selected by the GSA as the successful offeror of the
Solicitation for Offer to design and build a facility to be leased to the Federal Bureau of
Investigation. The GSA has assigned the Option Agreement to the Developer, and the Developer
has agreed to assume and perform all of the GSA's rights and obligations under the Option
Agreement, which Option Agreement was amended by that certain First Amendment to Real
Estate Option Agreement, dated effective June 19, 2009, and by that certain Second Amendment
to Real Estate Option Agreement, dated effective September 17, 2009, each by and between the
Authority and the Developer.
WHEREAS, as required by Section 3 of the Option Agreement, the Developer, in order
to exercise the option granted in the Option Agreement, has executed this Development
Agreement to establish the Developer's commitment to the Authority to, among other things,
design and construct the Minimum Improvements in accordance with the terms hereof.
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, provide jobs for residents of the City, and
will otherwise benefit the health, safety, morals and welfare of the 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, and the City and Authority are interested in the
2083895v11
development of the Development Property as a high quality class A office building to maximize
the development of the Development Property.
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:
2083895v11 2
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:
"Act" means Minnesota Statutes,'Sections 469.001 to 469.047 and 469.090 to 469.1082,
both inclusive, as amended.
"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's Documents" means the documents to be executed and/or delivered by the
Authority at the Closing pursuant to Section 3.9(b) of this Agreement.
"Authority Representative" means the Executive Director of the Authority or his
designee.
"Board" means the Board of Commissioners of the Authority.
r "Certificate of Release of Forfeiture" means the certificate in substantially the form
attached hereto as Exhibit B signed by the Authority Representative certifying that the conditions
in Section 4.6 hereof have been satisfied.
"City" means the City of Brooklyn Center, Minnesota.
"Closing" means the closing on the conveyance of the Development Property.
"Closing Date" means the dates on which the Development Property is conveyed by the
Authority to the Developer, which date shall be as set forth in Section 3.9(a) of this Agreement.
"Completion Date" means date the City issues a of certificate of occupancy for the
Minimum Improvements.
"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 building official of
the City and not classified within the federal government's sole discretion.
"Construction Lender" means any lender for the construction of the Minimum
Improvements.
i
2083895v11 3
"Construction Mortgage Loan" means any construction mortgage loan to be obtained by
the Developer to provide construction and permanent financing for the construction of the
Minimum Improvements.
"County" means the County of Hennepin, Minnesota.
"Deed" means the limited warranty deed executed by the Authority conveying the
Development Property to the Developer, in the form attached hereto as Exhibit C.
"Developer" means Barry Minneapolis, LLC, a Georgia limited liability company, its
successors or permitted assigns.
"Developer's Documents" means the documents to be executed and/or delivered by the
Developer at the Closing pursuant to Section 3.9(c) of this Agreement.
"Developer Event of Default" means the occurrence of an Event of Default set forth in
Section 10.1 hereof.
"Development" means the Development Property and the Minimum Improvements to be
constructed thereon as provided in this Agreement.
"Development Property" means the real property legally described on Exhibit A attached
hereto.
"Lease" means the 20 year lease of the Development Property and the Minimum
Improvements from the Developer as lessor to the GSA.
"Minimum Improvements" means an approximately 140,000 square foot class A office
building, a 20,000 square foot motor pool building, and a 200 stall structured parking ramp.
"Mortgage" means any mortgage loan to the Developer that is secured, in whole or in
part by a mortgage on the Development.
"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 7.1 of this
Agreement.
"Occupancy Agreement" means the Occupancy Agreement between the GSA and the
Sublessee.
"Permitted Encumbrances" means all matters identified as exceptions on Schedule B of
the Title Commitment and all matters listed on Exhibit D of this Agreement except for matters
that were the subject of an Objection and that the Authority agreed to cure and cured pursuant to
the procedures described in Section 3.6 of this Agreement.
"Preliminary Plans" means the site plan and the preliminary (30% complete) design,
specification and architectural plans for the Minimum Improvements (including, without
2083895v11 4
limitation, building elevations and description of exterior materials) to be 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 and attached as Exhibit F.
"State" means the State of Minnesota.
"Sublessee" means the Federal Bureau of Investigation (FBI) Minneapolis Field Office,
an agency of the United States Government.
"Title Commitment" means the updated Title Insurance Commitment from the Title
Company, with an effective date of August 3, 2009 (Commitment No. ORTE711850), and
copies of the documents referenced therein, for the Development Property.
"Title Company" means Old Republic National Title Insurance Company.
"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, acts of terrorism or insurrection, (e) acts of any State or local governmental unit which
directly result in delays, (f) strikes or walkouts, (g) delays in delivery of materials for the
Minimum Improvements, or (h) soil conditions of the Development Property.
2083895v11 5
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1 Renresentations and Warranties of the Authoritv. 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 the Option Agreement and carry out its obligations
hereunder.
(b) The Authority has taken all action necessary to approve this Agreement
and the Option Agreement and to authorize the execution and delivery of this Agreement and the
Option 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 the
Option 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 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 or the City 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 financial interest in this Agreement or the Development Property, 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.
Section 2.2 Renresentations and Warranties by the Developer. The Developer
represents and warrants to the Authority and the City that:
(a) The Developer is a limited liability company organized and in good
standing under the laws of the state of Georgia, is properly qualified to transact business in the
State 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 governing body.
2083895vi1 6
(b) The execution and delivery of this Agreement, the Lease and the
assignment of the Option 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, the Lease and the
assignment of the Option Agreement will not create a conflict of interest prohibited by
Minnesota Statutes, Section 471.87.
(d) 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 this
Agreement, or questioning the authority of the Developer to execute and deliver this Agreement
or the validity of this Agreement.
(e) The Developer has or will have prior to the Closing Date adequate
financial capability, consisting of binding commitments for equity and financing, to construct
and to complete each of the activities or tasks required by this Agreement including but not
limited to, the design and completion of construction of the Minimum Improvements by the
Completion Date.
(f) The total construction cost for the Minimum Improvements, including
furniture, fixtures and equipment, will be at least $40,000,000.
2083895v11 7
ARTICLE III
CONVEYANCE OF DEVELOPMENT PROPERTY
Section 3.1 Purchase and Sale of Develo>Ament Pronerty. Upon Developer's
performance of the GSA's obligations under this Article III, the Authority must execute the Deed
and deliver it to the Developer.
Section 3.2 Purchase Price. The Purchase Price for the Development Property is
$1.00 (one dollar) (the "Purchase Price
Section 3.3 Developer's RiLyht to Inspect. Developer is hereby granted the right to
enter upon the Development Property for the purposes of inspecting the same and making tests
borings, plans, topographical and boundary surveys, environmental assessments, and any other
due diligence matters deemed reasonably prudent in connection with the contemplated use of the
Development Property. Developer shall provide the Authority reasonable notice, not less than
twenty -four hours, prior to entering the Development Property. 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 defend the Authority from and to hold the Authority harmless against any and all
claims, liens, causes of actions or expenses, including attorneys' fees, relating to or arising from
Developer's presence or activities on the Development Property or the performing of any of the
analyses, tests or inspections referred to in this Section. Developer shall maintain insurance in
amounts and with coverages reasonably acceptable to the Authority. Developer shall promptly
repair and restore the Development Property to the same condition as existed immediately prior
to such entry if such entry resulted in any damage thereto.
Section 3.4 "As Is" Convevance. In recognition of the inspection rights accorded the
Developer and the contingencies granted to Developer in Section 3.8 (iii) and 3.8 (iv) but subject
to the Authorities obligations under Section 3.12, the Developer agrees to accept title to the
Development Property at closing on an "AS IS" "WHERE IS" basis, with all faults and defects,
without any representations or warranties, express or implied, and the Developer waives and
releases any claims against the Authority, the City and their respective members, boards, agents
and employees, for indemnification, contribution, reimbursement or other payments arising
under federal and state law, common law or any other theory relating to environmental or any
other condition of the Development Property.
Section 3.5 Acknowledgements by the Authoritv. The Authority acknowledges and
agrees that the Developer will lease the Development Property to the United States of America,
by and through the GSA, pursuant to the Lease for the occupancy by the Sublessee pursuant to
the Occupancy Agreement. The Authority further acknowledges that, to the best of the
Authority's actual knowledge, the Development Property is exempt from real estate taxes due
and payable in 2009. Future assessments and classifications for tax purposes will be determined
by the County.
2083895vll 8
Section 3.6 Subdivision: Title and Survev.
(a) The Developer has obtained, at the Developer's expense, a survey of the
Development Property in accordance with the 2005 Minimum Standard Detail Requirements for
ALTA/ACSM Land Title Surveys (the "Survey Prior to the date hereof, the Developer has
delivered a copy of the Survey to the Authority and the Authority has applied to the City of
Brooklyn Center for approval of a replat, lot split, minor subdivision or administrative
subdivision of the Property (the "Subdivision as necessary, to allow a deed of the
Development Property from the Authority to the Developer to be recorded in the Hennepin
County land records.
(b) Prior to the date hereof, the Authority has provided the Developer with the
Title Commitment. The Developer has given the Authority written notice of any alleged
defect(s) in the Authority's title to the Property and requested that the Authority cure certain
alleged defects (each such alleged defect is an "Objection Prior to the date hereof, the
Authority has agreed to undertake to cure one or more of the Objection(s). The Authority shall
have no obligation to undertake to cure any Objection. As to those Objections which the
Authority has agreed to undertake a cure, the Authority and the Developer have agreed upon
what actions, if any, the Authority will undertake to cure such Objection. If the Authority is
unable, notwithstanding the use of commercially reasonable efforts, to cure any Objection prior
to Closing, the Developer may either:
(i) Elect to terminate this Agreement; or
ii notify the Authority that the Developer waives the Objection (s)
fY t3' p J
and proceed to Closing.
The Permitted Encumbrances, as determined pursuant to the procedures described in this
Section 3.6 and as listed on Exhibit D hereto (plus any encumbrance that is the subject of an
Objection that the Authority elected to attempt to cure, but was unable to cure, and which
Objection the Developer has waived pursuant to subsection (b)(ii) above)) shall be identified on
the Deed as such. If the Developer closes the sale contemplated under this Agreement, the
Developer is agreeing to accept title to the Development Property subject to the Permitted
Encumbrances. The Authority represents to the Developer that between the effective date of the
Title Commitment and the date hereof, the Authority has not subjected all or any portion of the
Development Property to any consensual lien or to any covenant, condition, restriction, easement
or other voluntary encumbrance.
Section 3.7 Acknowledeements by Developrer. The Developer acknowledges and
agrees that: (a) no promises or commitments of any type or kind have been made by the
Authority with respect to providing financial assistance to the Minimum Improvements, whether
by loan, grant, bond issuance of otherwise; (b) the Developer will need to obtain all permits and
approvals for the design, construction and operation of the Minimum Improvements required by
applicable law, including all building and environmental permits and approvals, and that no
promises have been made by the Authority with respect to waiving or modifying any applicable
permitting requirements; (c) the City must approve a subdivision of the Property, as defined in
the Option Agreement, to allow the Deed to be recorded in the County land records and no
2083895v11 9
promises have been made by the Authority with respect to the City's waiver or modification of
any applicable subdivision requirements; and (d) no promises or commitments have been made
by the Authority with respect to the assessed valuation of the Minimum Improvements or any of
the facilities ancillary thereto. The Developer acknowledges that the Development Property will
not be exempt from ad valorem real estate property taxes.
Section 3.8 Contingencies to Closing on Development Proverty.
(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 closed on its financing for the design and
construction of the Minimum Improvements.
(ii) Title to the Development Property shall have been found
acceptable, or been made acceptable.
(iii) Developer shall have determined that it is satisfied with the results
of all matters disclosed by hazardous waste and environmental review 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.
(v) The Authority shall have performed all of the obligations required
to be performed as of the Closing Date by Authority under this Agreement.
(vi) The Authority shall have delivered to the Developer all of the
Authority's Documents described in Section 3.9(b).
(vii) The City shall have granted all necessary subdivision approvals.
(b) Authoritv'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 in writing on or before the Closing Date:
(i) Developer shall have closed on its financing for the design and
construction of the Minimum Improvements in an amount which the Developer certifies
to the Authority is sufficient, together with other funds available to the Developer, to
complete the construction of the Minimum Improvements in accordance with the
Construction Plans.
(ii) Developer shall have performed all of the obligations required to
be performed as of the Closing Date by Developer under this Agreement.
(iii) The Developer shall have delivered to the Authority all of the
Developer's Documents described in Section 3.9(c).
2083895v11 10
(iv) The Developer shall have obtained the approval of the Authority to
the Preliminary Plans for the Minimum Improvements as required by Section 4.2 of this
Agreement.
(v) Payment and performance bonds from the contractor or
subcontractors in the amount of the applicable portion of the contract price for
construction of any public improvements by the contractor and subcontractors covered by
their respective contracts prior to commencement of the construction of any public
contracts.
covered b their re improvements o y contra p
(vi) The City shall have granted all necessary subdivision approvals.
Section 3.9 Closing on the Development Proverty
(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 date
120 days after the date Developer exercises the option set forth in the Option Agreement, which
is the date of this Agreement, (or the next business day if the 120'' day after the date of this
Agreement is a federal holiday), or such other date as the parties mutually agree. The Closing
shall take place at the Saint 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 to the Developer on the Closing Date.
(b) Authoritv's Documents. At the Closing, the Authority shall execute,
where appropriate, and deliver all of the following:
(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 to the Development Property that are in the
Authority's possession or control. The Authority has no obligation to have any abstracts
of title recertified to a current date.
(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, unsatisfied judgments, tax liens or bankruptcies against or involving the
Development Property; that there has
been no labor or material furnished to the
P P rtY�
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) A resolution of the Authority authorizing the Authority's
conveyance of the Development Property to Developer and identifying the individuals
authorized to execute the Deed and any other documents required hereunder.
(v) A completed Minnesota Department of Health Well Disclosure
Certificate or include on the deed described in Paragraph 9 the statement "The Seller
certifies that the Seller does not know of any wells on the described real property or the
2083895v11 11
statement "I am familiar with the property described in this instrument and I certify that
the status and number of wells on the described real property have not changed since the
last previously filed well disclosure certificate:" followed by Optionor's signature.
(vi) Any information necessary for Developer's preparation of a
Minnesota Certificate of Real Estate Value.
(vii) A non foreign affidavit in recordable- form containing such
information as its required under IRC Section 1445(b)(2) and any regulations relating
thereto.
Developer's Documents. At the Closing, the Developer shall execute,
(c g p
where appropriate, and deliver all of the following:
(i) The Purchase Price.
(ii) An executed copy of the Lease which shall be for a term of not less
than 20 years and shall provide that neither the GSA nor any other governmental entity
has an option to purchase the Development Property and the improvements thereon prior
to the end of such 20 year period.
(iii) An executed copy of the GSA Standard Form 2 (SF2) and an
executed copy of the Occupancy Agreement.
(iv) Proof of insurance required pursuant to this Agreement.
(v) 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.
(vi) 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.
(vii) A certificate of good standing for Developer from the Secretary of
State of the State.
(viii) A completed Minnesota Certificate of Real Estate Value.
Section 3.10 Authoritv Support for Other Proiects. The Developer acknowledges
and agrees that the Authority shall have the right to support other projects and developments;
provided, however, the Authority agrees not to encourage or promote redevelopment of unused
land adjacent to the Development Property for any use that poses a security threat to the
Minimum Improvements as determined by the Developer and the GSA in their sole respective
discretions, including but not limited to motels, hotels and warehouse distribution facilities. To
the extent the Authority has control, it will encourage Class A general office uses of land
adjacent to the Development Property.
2083895v 11 12
Section 3.11 Option Agreement. Upon Developer's exercise of the option set forth in
the Option Agreement the terms of the Option Agreement are merged into this Agreement, and
the Option Agreement is of no further force or affect.
Section 3.12 Voluntary Removal of Contaminated Soils. To the extent the Authority
has not already done so pursuant to Section 22 of the Option Agreement the Authority must:
(a) enroll in the Voluntary Petroleum Investigation and Cleanup Program (the
"VPIC Program of the Minnesota Pollution Control Agency "MPCA promptly engage
Tetra Tech, Inc. to prepare a Soil Contingency Plan which describes the soil removal and
disposal activities the Authority would undertake to address the contaminated soils described in
Tetra Tech's Subsurface Assessment Results Former Days Inn Site —1501 Freeway Boulevard,
Brooklyn Center, Minnesota dated January 28, 2008; and submit the Soil Contingency Plan to
the MPCA for review and approval;
(b) promptly implement the Soil Contingency Plan upon the MPCA's
approval of the Soil Contingency Plan;
(c) submit a completion report to the MPCA that describes the actions which
the Authority has undertaken and completed and that ncludes results of soils samples taken
during the soil removal process upon completion of the activities described in the approved Soil
Contingency Plan and acquire from the MPCA and deliver to Developer a Completion of
Voluntary Response Action Letter, a MPCA Closure Confirmation Letter and a Tank Removal
Verification Letter, all in substantially the forms of the pro forma letters attached as Exhibit D to
the Option Agreement.
The Authority must use all commercially reasonable efforts to complete the excavation and soil
removal activities described in the approved Soil Contingency Plan within one hundred and
twenty (120) days of the date of the Option Agreement, but Developer acknowledges that the
Authority will require thirty (30) days to prepare and submit the Soil Contingency Plan and forty
five days after MPCA's approval of the Soil Contingency Plan to implement the plan and
remove the soils from the Property and that the Authority cannot control the timing of the
MPCA's review and approval of the proposed Soil Contingency Plan or the MPCA's review and
approval of the Authority's completion report and issuance of the above described letters.
Except as expressly set forth in this Section 3.12, the Authority is not responsible for taking any
action to remediate or otherwise address any environmental contamination on the Development
Property, whether currently known or unknown, and except as set forth in Section 8(e) of the
Option Agreement, Optionor makes no representations or warranties regarding the presence or
absence of Hazardous Substances in or on the Development Property.
2083895v 11 13
ARTICLE IV
CONSTRUCTION OF MINIMUM IMPROVEMENTS
Section 4.1 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 Construction -Plans for the Minimum
Improvements approved by the City in connection with obtaining a building permit. The
Developer will employ the design excellence standards of the GSA Office of the Chief Architect
for a Class A office building and will employ materials comparable in quality and aesthetics to
those used in existing facilities of the Federal Bureau of Investigation in other locations
throughout the United States.
Section 4.2 Preliminary Plans
(a) The Developer shall deliver to the Authority no later than thirty (30) days
prior to Closing the Preliminary Plans for the Minimum Improvements. The Preliminary Plans
must be 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 Authority shall review the Preliminary Plans and will deliver to the Developer before
the Closing Date, a written statement approving the Preliminary Plans or a written statement
rejecting the Preliminary Plans and specifying the deficiencies in the Preliminary Plans. The
Authority shall approve the Preliminary Plans if. (i) the Preliminary Plans conform to the terms
and conditions of this Agreement; (ii) the Preliminary Plans are consistent with the goals and
objectives of the Redevelopment Plan; and (iii) the Preliminary Plans do not, to the knowledge of
the Authority, violate any applicable Federal, State or local laws, ordinances, rules or
regulations.
(b) The approval of the Preliminary Plans, or any proposed amendment to the
Preliminary Plans, by the Authority does not constitute a representation or warranty by the
Authority that the Preliminary Plans, 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 Preliminary Plans, or any proposed amendment to the Preliminary Plans, by the
Authority will not constitute a waiver of any Developer Event of Default.
Section 4.3 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 no later than May 31, 2010 and will complete
construction of the Minimum Improvements no later than October 1, 2011. The Minimum
Improvements will be constructed by the Developer on the Development Property in conformity
with the Preliminary Plans approved by the Authority and the Construction Plans approved by
the City in connection with the issuance of a building permit. At all times during construction,
upon the request of the Authority, the Developer will provide the Authority reasonable access to
2083895v11 14
the Development Property. "Reasonable access" means at least one site inspection per month
during regular business hours. During construction 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 4.4 Comaliance 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 enviromnental permits, licenses,
approvals or reviews. As of the date of Closing, 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.
Section 4.5 Additional Resnonsibilities 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 Preliminary Plans approved by the Authority and the Construction Plans
approved by the City in connection with the issuance of a building permit.
(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 current technical specifications, standards and practices of the owner thereof.
(e) The Developer will comply with all applicable local, state and federal
environmental laws and regulations, as they relate to the Minimum Improvements.
Section 4.6 Certificate of Release of Forfeiture. The Developer shall notify the
Authority when the construction of the Minimum Improvements has been completed. The
Authority shall cause the City to promptly inspect the Development Property in order to
determine whether construction of the Minimum Improvements has been completed. If the City
determines that the construction of the Minimum Improvements has not been completed, the
Authority shall deliver a written statement to the Developer indicating as such and Developer
shall promptly remedy such deficiency. Promptly upon the issuance by the City of a certificate
i of occupancy for the Minimum Improvements, the Authority will furnish to the Developer a
Certificate of Release of Forfeiture in the form attached hereto as Exhibit B certifying
2083895v11 15
completion of the construction of the Minimum Improvements. The Developer shall cause the
proper office for recordation of deeds ro
Certificate of Release of Forfeiture to be recorded In the p p
and other instruments pertaining to the Development Property.
Section 4.7 Completion. The Developer shall notify the Authority when the
construction of the Minimum Improvements have been substantially completed; and, upon
receipt of the Certificate of Occupancy, will provide the Authority with a copy thereof.
Section 4.8 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, any
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, Authority and the Authori 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 4.9 Business Subsidv Agreement.
(a) In order to satisfy the provisions of Minnesota Statutes, Section 116J.994
(the "Business Subsidy Act the Developer acknowledges and agrees that the amount of the
"Business Subsidy" granted to the Developer under this Agreement is the fair market value of
the Development Property and that the fair market value of the Development Property is $8.50
per square foot.
(b) The public purpose of the Business Subsidy is to increase the tax base and
to create jobs.
(c) For its "Job Goals" under this Section 4.9 the Developer covenants that it
will provide or cause to be provided by the Sublessee 200 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 Business Subsidy
Act, the goals of the Business Subsidy are the construction of the Minimum Improvements and
operation thereof by the Sublessee for at least five years after the `Benefit Date" of the Business
Subsidy, as defined in the Business Subsidy Act, which is hereby determined to be the date of
the issuance of a certificate of occupancy for the Minimum Improvements.
(e) For purposes of the Business Subsidy Act, the Business 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 4.9, subject
to any remedial provisions of the Business Subsidy Act as may be applicable, the Developer
shall be obligated to repay the Business Subsidy plus interest from the Closing Date 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 the Authority may agree in the absolute discretion of the
Board of Commissioners, that the Business Subsidy be repaid by the Developer pro rata, e.g., if
2083895v11 16
the Developer created only 100 of the 200 jobs at the Minimum Improvements, the Developer
would repay 50% of the Business Subsidy paid to the Developer, plus accrued interest thereon.
The parties hereby agree that upon the Developer's filing of a report pursuant to subsection (i)
below which certifies that the Developer has satisfied all of its Job Goals, the forgivable loan
described above shall be deemed forgiven and the Developer shall have no further repayment
obligation under this Section 4.9(e). The Business Subsidy is needed in order to induce the
Developer to construct and occupy the Minimum Improvements. The Developer covenants that
it will use all commercially reasonable efforts to cause the GSA and/or Sublessee to continue
to operate and occupy 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 it has not received any State of Minnesota
or "local government agency" grants (other than the Business Subsidy hereunder) related to the
Minimum Improvements except as described below (if none, leave blank):
Grantor Value
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 Business Subsidy Act.
(i) The Developer shall complete and file the report in the form of the
attached Exhibit E with the Authority, in care of the Executive Director, on March 1 of each
year, (1) beginning with the March 1 immediately following the Benefit Date, and (2) until the
later of the date the Job Goals are met or two years after the Benefit Date, or, if the Goals are not
met, until the date the Business Subsidy is repaid as provided in Section 4.9(e). The Business
Subsidy Act 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. 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.
0) This Section 4.9 is intended to be the "subsidy agreement" required by
Section 116J.994, Subdivision 3, of the Business Subsidy Act. In the event that any provision of
this Section 4.9 is inconsistent or in conflict with any provision of the Business Subsidy Act, and
in the event that any provision of the Business Subsidy Act provides additional requirements, the
provisions of the Business Subsidy Act shall apply and govern. In addition to all reporting
obligations of the Developer under this Section 4.9 and Exhibit E. 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 Business Subsidy Act.
2083895v11 17
(k) Nothing in this Section 4.9 is intended to limit or otherwise amend the
other terms of this Agreement; provided, however, that to the extent that provisions in this
Section 4.9 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 cause the GSA
and/or the Sublessee to continue to operate and occupy the Minimum Improvements for at least
five years from the Benefit Date is a requirement of the Business Subsidy Act (subject to
procedures therein allowing relaxation or waiver of said requirement) and shall apply and
govern.
(1) If the Developer shall default under its agreement in this Section 4.9, the
Developer shall then be required to repay the Business Subsidy to the Authority, plus interest at
no less than the implicit price deflator, as defined under Minnesota Statutes, Section 275.70,
Subdivision 2 from the date of said default and continue paying interest thereon at such rate until
the Business Subsidy is paid in full.
i
2083895v11 18
ARTICLE V
NO PUBLIC IMPROVEMENTS
Section 5.1 No Public Improvements. Neither the Authority nor the City shall have
any obligation to construct, install, improve or modify any public improvements (including
without limitation streets, sidewalks, curbs or utility services) in connection with the
Development; the Developer acknowledges that all of such improvements or modifications, if
any, shall be a part of the Minimum Improvements and constructed at the sole expense of the
Developer. If the Developer determines that the existing water line on the Development
Property interferes with the construction of the Minimum Improvements, the Authority and the
Developer will cooperate to relocate the water line, to vacate any unnecessary easements and to
create any new easements necessary for the relocated water line, all at the sole expense of the
Authority.
2083895v11 19
ARTICLE VI
CERTAIN FINANCING PROVISIONS
Section 6.1 Encumbrance of the Development Property. Until the Completion
Date, neither the Developer nor any successor in interest to the Developer will engage in any
fmancing 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 constructing the Minimum
Improvements (including, but not limited to, land and building acquisition, labor and materials,
professional fees, real estate taxes, construction interest, organization and other actual costs of
development).
Section 6.2 CoDv of Notice of Default to MortLyagee. If the Authority delivers any
notice or demand to the Developer with respect to a Developer 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 6.3 Mortgagee's Option to Cure Events of Default. Upon the occurrence of
a Developer Event of Default, the mortgagee under any Mortgage will have the right within the
time period required by this Agreement to cure or remedy such Developer Event of Default.
Section 6.4 Defaults Under Mortsage. In the event the Developer is in default under
any Mortgage prior to the Completion Date, the Developer, within ten (10) days after it becomes
aware of any default and prior to exercising any remedy available to it due to such default, shall
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 elects (at its sole option) to cure any default under the Mortgage, the mortgagee will
pursue none of its remedies under the Mortgage based on such default.
Section 6.5 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 this Agreement, 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.
2083895v11 20
ARTICLE VII
INSURANCE AND CONDEMNATION
Section 7.1 Insurance.
(a) The Developer will obtain and continuously maintain insurance on the
Development Property (including the Minimum Improvements) 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 Minimum Improvements, and with coverage available in
nonreporting form on the so -called "all risk" form of policy.
(ii) Comprehensive general liability insurance in amounts and
coverages normally held by businesses engaged in activities similar to those of the
Developer.
(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
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
2083895v11 21
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 prior to the Completion Date, and the damage or destruction is estimated to equal
or exceed $100,000, then the Developer, within one hundred fifty (15 0) 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 7.2 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 takin g through he exercise of the power of eminent domain, the Developer will notify the
P
Authority f the threatened taking with reasonable promptness; and shall keep the Authority
tY g P
advised of the progress thereof.
2083895v11 22
ARTICLE VIII
DEVELOPER COVENANTS
Section 8.1 Maintenance and Operation of the Development. In addition to other
maintenance and operation obligations of the Developer under this Agreement, the Developer
will, at all times during the term of this Agreement, maintain and operate the Development
Property and the Minimum Improvements 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. The Developer shall pay all of the expenses of the operation and maintenance of the
Development Property and the Minimum Improvements of this Agreement, 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 or operation of the
Minimum Improvements as required pursuant to this Agreement. The Developer shall also pay
all costs and expenses of capital improvements and replacements of the Minimum
Improvements. During construction or operation of the Minimum Improvements, Developer
shall not cause any person working in or attending the Development for any purpose, to be
exposed to any hazardous or unsafe condition; and shall cause its contractors, employees or
agents employed by Developer to work on the Development Property to take such precautions as
may be available to protect the persons in and around the Development Property from hazards
arising from the work, and shall further require each such contractor to obtain and maintain
liability insurance protecting against liability to persons for injury arising from the work. In- the
event that the Developer is required to utilize a common retention pond for the purposes of storm
water management then the Developer shall also be responsible for the maintenance and any
capital replacement and/or improvement of the storm water retention pond located adjacent to
the Development Property on a pro rata basis determined by calculating the ratio of impervious
site area to pervious site area.
2083895v11 23
ARTICLE IX
TRANSFER LIMITATIONS AND INDEMNIFICATION
Section 9.1 Representation as to Development: Limit on Transfer of Ownership
Interest in Developer. 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 leasing the Development Property to the Sublessee, 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 and Sublessee 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 and the Sublessee, and the execution of the Lease.
Section 9.2 Limitations on Transfer. The Developer may, but until the Completion
Date only with prior written notice to the Authority which shall not be required after the
Completion Date, mortgage the Development Property and the Minimum Improvements to a
lender providing construction and/or permanent financing for the Minimum Improvements.
Prior to the Completion Date, except pursuant to the Lease and the Occupancy Agreement or as
otherwise provided in this Section, the Developer will not sell, assign, convey, lease, mortgage,
transfer or otherwise encumber 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 may be given or withheld in the Authority's sole discretion. In
the event that the Authority elects to consent to any proposed transfer, the Authority shall be
entitled to require, as conditions to any approval of any such 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 find desirable, in its sole discretion, in order to achieve and safeguard the
purposes of the Act, the Development Plan and the Developer Documents; and
2083895v11 24
(e) In the absence of specific written agreement by the Authority to the
contrary, no such transfer or approval by the Authority shall be deemed to relieve the Developer
or any other party bound in any way by this Agreement or otherwise with respect to the
construction of the Minimum Improvements, from any of its obligations with respect thereto.
Section 9.3 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 and all losses or damages 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, operation and
maintenance of the Development.
Section 9.4 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.
2083895v11 25
ARTICLE X
EVENTS OF DEFAULT AND REMEDIES
Section 10.1 Developer Events of Default. Any of the following shall be a Developer
Event of Default:
(a) Subject to Unavoidable Delays, the Developer shall fail to begin
construction of the Minimum Improvements and to proceed with due diligence to satisfactorily
complete substantial construction of the Minimum Improvements by the dates set forth in
Section 4.3 hereof, and such failure to begin, or proceed with due diligence to complete, the
construction of such 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, other than as
a result of Unavoidable Delays, shall such additional cure period extend beyond 180 days;
(b) there is, in violation of Article IX of this Agreement, any conveyance or
other transfer of the Development Property or any part thereof, and such violation is not cured
within 30 days after written demand by the Authority to the Developer;
(c) subject to Unavoidable Delays, 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, other than as a result of Unavoidable Delays, shall such additional cure
period extend beyond 180 days; or
(d) failure of the Developer to pay an ad valorem real property tax or special
assessments as the same become due and payable.
(e) a default shall occur under the Construction Loan Mortgage and is not
cured within the time permitted therein; or
(f) the Closing on the Development Property does not occur by the Closing
Date; or
(g) the Developer shall (i) file any petition in bankruptcy or for any
reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief
2083895vi1 26
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
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 10.2 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 Authority Event of Default.
Section 10.3 Authoritv Remedies on Default.
(a) If any Developer Event of Default occurs prior to the Closing Date, the
Authority may take any one or more of the following actions:
(i) Suspend its performance under this Agreement.
(ii) Cancel and terminate this Agreement and the Option Agreement,
pursuant to Minnesota Statutes, Section 559.21 upon thirty (30) days written notice of
default.
(iii) 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.
(iv) Commence an action against Developer to recover the Authority's
damages.
(b) If any Developer Event of Default occurs after the Closing Date and prior
to the Completion Date, the Authority or may take any one or more of the following actions:
(i) Suspend its performance under this Agreement.
(ii) Withhold the Certificate of Release of Forfeiture and/or cancel and
terminate this Agreement.
(iii) 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.
2083895v11 27
damages. (iv) Commence an action against Developer to recover the Authority's
(c) If any Developer Event of Default occurs after to the Completion Date, the
Authority may take whatever action at law or in equity may appear necessary or desirable to the
Authority to collect any payments due under this Agreement, to enforce performance and
observance of any obligation, agreement, or covenant of the Developer under this Agreement or
to recover the Authority's damages.
Section 10.4 Revestine Title in the Authoritv. If, subsequent to conveyance of the
Development Property to the Developer, and before issuance of any Certificate of Release of
Forfeiture pursuant to Section 4.6, a Developer Event of Default occurs and is not cured within
any cure period allowed in Section 10.1, then the Authority shall have the right to re -enter and
take possession of the Development Property and to terminate and revest in the Authority such
portion of 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
uncured Event of Default by the Developer, all Development Property for which 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. The foregoing right of reversion shall be subject to the
terms of any Mortgage, provided that for purposes of redemption of the Development Property
following any foreclosure of said Mortgage, the holder of such Mortgage shall deem the
Authority to be the owner of the Development Property and permit the Authority to redeem the
Development Property as if it were the owner of the Development Property.
Section 10.5 Developer Remedies on Default. Whenever any Authority 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 specific performance and observance
of any obligation, agreement, or covenant of the Authority under this Agreement.
Section 10.6 No Remedv 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
Developer Event of 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.
Section 10.7 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 10.8 Reimbursement of Attornevs' Fees. If the Developer or Authority shall
default under any of the provisions of this Agreement, and the Developer, Authority or City shall
employ attorneys or incur other reasonable expenses for the collection of payments due
2083895vl l 28
hereunder, for the collection of its damages, or for the enforcement of performance or
observance of any obligation or agreement on the part of the Developer, Authority or City
contained in this Agreement, the defaulting party or parties will on demand therefor reimburse
the non defaulting party or parties for the reasonable fees of such attorneys and such other
reasonable expenses so incurred by such non defaulting parties.
2083895v11 29
ARTICLE XI
ADDITIONAL PROVISIONS
Section 11.1 Conflicts of Interest. No member of the Board, City Council or other
official of the Authority or the City 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 or the City shall be personally
liable to the Authority or the City in the event of any default or breach by Developer or successor
or on any obligations under the terms of this Agreement.
Section 11.2 Real Estate Aeents. The Developer hereby agrees to indemnify the
Authority and City from any real estate or other sales commission or fee payable to any broker
hired or engaged by the indemnifying party in respect of the transactions contemplated by this
Agreement.
Section 11.3 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 11.4 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 Barry Minneapolis, LLC, c/o Barry Real
Estate Companies, Inc., 30 Ivan Allen Jr. Boulevard, Suite 900, Atlanta, Georgia 30308,
Attention: Chuck Moody, or in the case of the Authority or the City, 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 11.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall constitute one and the same instrument.
Section 11.6 Law Governing. This Agreement will be governed and construed in
accordance with the laws of the State of Minnesota.
Section 11.7 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.
2083895v11 30
Section 11.8 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 11.9 Superseding Effect. This Agreement and the Option Agreement reflect
the entire agreement of the parties with respect to the Development, and supersedes in all
respects all prior agreements of the parties, whether written or other -vise, with respect to the
Development.
Section 11.10 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 11.11 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
referred to non binding mediation before, and as a condition precedent to, the initiation of any
legal action hereof, provided for herein. Each parry 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 11.12 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 11.13 Provisions Surviving Rescission or Expiration. Sections 9.3 and 10.8
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 11.14 Time of Essence. Time is of the essence for the observance and
performance of the parties' respective obligations and duties under this Agreement.
Section 11.15 Modification. The Authority and Developer may amend this agreement
upon mutual written consent.
2083895v11 3 1
IN WITNESS WHEREOF, the Authority 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.
AUTHORITY:
ECONOMIC DEVELOPMENT
AUTHORITY OF BROOKLYN CENTER
By
Executive Director
2083895v 11 32
DEVELOPER:
BARRYxff EAP ,LLC
By:
Name: stian B. Schoen
Its: Chief Executive Officer
2083895vl O 33
EXHIBIT A
LEGAL DESCRIPTION OF DEVELOPMENT PROPERTY
Tract A, Registered Land Survey No. 1477, according to the recorded plat thereof, Hennepin
County, Minnesota, together with that part of Lot 2, Block 1, RICHARDSON PARK 2ND
ADDITION, according to the recorded plat thereof, said Hennepin County, which lies easterly
and northerly of the following described line:
Commencing at the northwest corner of said Lot 2; thence easterly on an assumed
bearing of North 86 degrees 53 minutes 07 seconds East, along the northerly line of said
Lot 2, a distance of 136.00 feet to the point of beginning of the line to be described;
thence South 3 degrees 07 minutes 12 seconds East a distance of 102.56 feet; thence
South 47 degrees 07 minutes 12 seconds East a distance of 57.45 feet; thence North 89
degrees 58 minutes 58 seconds East to the east line of said Lot 2 and said line there
terminating.
The above described property to be platted as:
Lot 1, Block 1, RICHARDSON PARK 3RD ADDITION, according to the recorded plat thereof,
Hennepin County, Minnesota.
2083895v11 A-1
EXHIBIT B
CERTIFICATE OF RELEASE OF FORFEITURE
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 Barry Minneapolis, LLC, a Georgia limited
liability company (the "Grantee in the County of Hennepin and State of Minnesota, the
following legally described property to wit:
and
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,
the City of Brooklyn Center and the Grantee dated 2009 (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 4.6 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
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
2083895vll B-1
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
200.
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
200_, 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
2083895v11 B -2
EXHIBIT C
LIMITED WARRANTY DEED
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: 200_
(Reserved for recording data)
FOR VALUABLE CONSIDERATION, the Economic Development Authority of Brooklyn
Center, a public body corporate and politic (the "Grantor hereby conveys and quitclaims to
Barry Minneapolis, LLC, a Georgia limited liability company (the "Grantee the real property
in Hennepin County, Minnesota, described as follows (the "Property"):
together with all hereditaments and appurtenances belonging thereto (the "Property This deed
conveys after acquired title. Grantor warrants that Grantor has not done or suffered anything to
encumber the property except as set forth below.
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 200_ (the "Development Agreement (2)
reservation of minerals and mineral rights; (3) real estate taxes and special assessments due and
payable in 2009 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; (6) all easements and rights -of -way shown in any recorded plat;
(7) the right of re -entry reserved to Grantor in this deed; and (8) [List each of the Permitted
Encumbrances from Exhibit D]. Promptly after the conditions set forth in Section 4.6 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 4.6 of the Development
Agreement of the Developer to construct the Minimum Improvements, it being the intention of
2083895v11 C-1
the parties that upon the 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, a
"Developer Event of Default," as defined in Section 10.1 of the Development Agreement occurs
and Grantee fails to cure such default within the period and in the manner stated in Section 10.1,
then the Grantor shall have the right to re -enter and take possession of the property and upon re-
entry by Grantor 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 or 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
By:
Its:
i
2083895v11 C -2
STATE OF MINNESOTA
)SS
COUNTY OF HENNEPIN
The foregoing instrument was acknowledged before me this day of
200_, by the of the Economic
Development Authority of Brooklyn Center, a public body corporate and politic, on behalf of
said body.
Notary Public
THIS INSTRUMENT WAS DRAFTED BY:
Briggs and Morgan, Professional Association (TLB)
2200 IDS Center
80 South Eighth Street
Minneapolis, MN 55402
2083895v11 C -3
EXHIBIT D
PERMITTED ENCUMBRANCES
1. Real estate taxes and special assessments due and payable in 2009 and subsequent years.
2. Reservation of minerals and mineral rights.
3. Applicable zoning laws and ordinances and all other local, state, regional and federal
laws and regulations.
4. The right of re -entry described in Section 10.4 of the Development Agreement and
reserved in the Deed.
5. Those obligations, restrictions and conditions as provided in the Development
Agreement.
6. Rights of the State of Minnesota as acquired in Final Certificate filed as Document No.
911865.
7. All minerals and mineral rights are reserved by the Regents of the University of
Minnesota.
8. No right of access exists from premises to Trunk Highway No. 393, renumbered 94 or to
Humboldt Avenue. Right of access was acquired by the State of Minnesota as evidenced
by Document No. 3720213 and 5064847. (as to Lot 2)
9. Restrictions, covenants and conditions as contained in Document No. 8887921 which
contain no forfeiture provision. (as to Lot 2)
10. Restrictions, covenants and conditions dated December 31, 1985, filed February 18,
1985, as Document No. 1704960, which contain no forfeiture provision. (as to Lot 2)
2083895vi 1 D -1
EXHIBIT E
BUSINESS SUBSIDY REPORT
Report of as Recipient of Business Subsidy
This report is required by Section 4.9 of that certain Development Agreement, dated as of
2009 (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 certain business subsidies to the
Developer.
Under the Agreement, the Developer is required to file reports with the Executive
Director and City Clerk (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 Minimum Improvements,
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 4.9 of the Agreement are to create at the
Minimum Improvements permanent full -time equivalent jobs within two years from the Benefit
Date. These jobs are required to have a wage of at least per hour, exclusive of benefits.
The Developer hereby certifies to the Authority and the City the following:
(1) As provided in the Agreement, the total fair market value of the Business
Subsidy is estimated to be the type of Business Subsidy is
and the sale of land valued at
for $1.00. 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 Minimum Improvements since the Benefit Date,
with separate bands of wages, are as follows:
Number of Jobs Wage Levels
Per Hour
2083895v11 E -1
(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 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 and is taking the
following steps to meet the Job Goals:
(5) The Developer has no parent corporation.
*(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 Minimum Improvements, except for:
Grantor Value
Grantor Value
(8) 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 Business Subsidy Act.
Verify
2083895v11 E -2
(9) The Developer is not in default on the date hereof of its obligations under
any subsidy agreement under the Business Subsidy Act.
DEVELOPER:
BARRY MINNEAPOLIS, LLC
By:
Printed Name:
Its:
This report is to be filed with:
City of Brooklyn Center
Economic Development Authority of Brooklyn
Center
6301 Shingle Creek Parkway
Brooklyn Center, MN 55430 -2199
Attn: Executive Director and City Clerk
i
2083895v11 E -3
EXHIBIT F
REDEVELOPMENT PLAN
s
F -1
2083895v11
Modified Redevelopment Plan
for
Housing Development and Redevelopment Project No. 1
and the
Tax Increment Financing Plan
for
Tax Increment Financing District No. 03
(A Redevelopment District)
Brooklyn Center Economic Development Authority
Hennepin County
City of Brooklyn Center, Minnesota
Prepared: December 12, .1994
Adopted: December 19, 1994
Prepared by:
PUBIICORP, INC.
512 Crown Roller Mill
105 Fifth Avenue South
Minneapolis, MN 55401
(612) 341 -3641
F -2
2083895v11