The URL can be used to link to this page

EDA 09/09/02OFFICIAL FILE COPY "- CITY OF NEW HOPE EDA MEETING City Hall, 4401 Xylon Avenue North September 9, 2002 President W. Peter Enck Commissioner Sharon Cassen Commissioner Don Collier Commissioner Mary Gwin-Lenth Commissioner Pat LaVine Norby 1. Call to Order 2. Roll Call 3. Approval of Regular Meeting Minutes of August 26, 2002 o Resolution Restating the Redevelopment Plans for the Master Modification; Redesignating the Master Modification as Redevelopment Project No. 1; Modifying the Restated Redevelopment Plan and Tax Increment Financing Plans for Redevelopment Project No. I and Tax Increment Financing Districts Nos. 80-2, 81-1, 82-1, 85-1, 85-2, and 86-1; Creating Tax Increment Financing District No. 02-1 and Adopting a Tax Increment Financing Plan Relating Thereto Resolution Authorizing Execution and Delivery of a Contract for Private Redevelopment, by and between the New Hope Economic Development Authority and Navarre Corporation Resolution Authorizing a Land Purchase from the City of New Hope and the Execution of a Note Establishing Terms for Payment Resolution Authorizing a Sale and Conveyance of Land to Navarre Corporation, or its Permitted Successors or Assigns, in Accordance with the New Hope Economic Development Authority's Terms and Conditions of Sale Resolution Approving Letter of Agreement Between the Brooklyn Park Economic Development Authority and the New Hope Economic Development Authority for the Second Surburban Remodeling Planbook Project, Split-Levels and Split-Entrys at a Cost of $5,000 (Improvement Project No. 623) 9. Adjoumment CITY OF NEW HOPE 4401 XYLON AVENUE NORTH NEW HOPE, MINNESOTA 55428 Approved EDA Minutes Regular Meeting August 26, 2002 City Hall CALL TO ORDER ROLL CALL APPROVE MINUTES EGAN COMPANIES Item 4 New Hope EDA Page 1 President Enck called the meeting of the Economic Development Authority to order at 8:31 p.m. Present: W. Peter Enck, President Sharon Cassen, Commissioner Don Collier, Commissioner Mary Gwin-Lenth, Commissioner Absent: Pat LaVme Norby, Commissioner Motion was made by Commissioner Cassen, seconded by Commissioner Gwin- Lenth, to approve the Regular Meeting Minutes of August 12, 2002. Voting m favor: Enck, Cassen, Collier, Gwin-Lenth; Voting Against: None; Absent: Norby; Abstained: None. Motion came& President Enck introduced for discussion Item 4, Discussion Regarding Request by the Egan Companies, 7100 Medicine Lake Road, for Financial Assistance to Relocate and Expand Facility in City of New Hope. Mr. Kirk McDonald, Director of Community Development, reported that The Egan Companies is considering purchasing and moving to the building at 8801 Science Center Drive. The new location would allow the company to consolidate operations into one facility. Due to significant improvements that would be required to the building, Egan is requesting financial assistance from the EDA. Mr. McDonald commented that Egan has over 750 employees designing and constructing electrical, mechanical, building automation, insulation, glass and curtain-wall systems. Presently Egan occupies six facilities, and this consolidation is expected to result in 50-100 new jobs. Mr. Craig Sulentic, Chief Executive Officer, and Tom Sexton, Cresa Partners, were recognized. They provided an overview of the building plans. The desire to remain in New Hope and retain existing labor base was emphasized. The present facility is 33,000 square feet, and the new site with the expansion would be 143,000 square feet in size. Mr. Sulentic explained that the 11.7 acres at the 8801 Science Center Drive site would provide future expansion opportumties. The EDA encouraged Mr. Sulentic to serve as a business representative on the City Center Task Force. Mr. McDonald noted he has begun preliminary discussions with Krass Monroe, but nothing formal has been prepared without the EDA's approval. He stated a financial analysis could be prepared within a month's time. The EDA directed staff to utilize services of a financial consultant to explore options for financial assistance to Egan Companies such as tax increment financing. August 26, 2002 ADJOURNMENT Motion was made by Commissioner Collier, seconded by Commissioner Gwin- Lenth, to adjourn the meeting. All present voted m favor. Motion camed. The New Hope EDA adjourned at 8:55 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA Page 2 August 26, 2002 EDA REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section Community Development ~ 9-09-02 EDA Item No. By: Kirk McDonald By: 4 RESOLUTION RESTATING THE REDEVELOPMENT PLANS FOR THE MASTER MODIFICATION; REDESIGNATING THE MASTER MODIFICATION AS REDEVELOPMENT PROJECT NO. 1; MODIFYING THE RESTATED REDEVELOPMENT PLAN AND TAX INCREMENT FINANCING PLANS FOR REDEVELOPMENT PROJECT NO. 1 AND TAX INCREMENT FINANCING DISTRICTS NOS. 80-2, 81-1 82-1, 85-1, 85-2 AND 86-1; CREATING TAX INCREMENT FINANCING DISTRICT NO. 02-1 AND ADOPTING A TAX INCREMENT FINANCING PLAN RELATING THERETO REQUESTED ACTION Staff recommends that the EDA approve the attached resolution. POLICY/PAST PRACTICE The EDA has created new and modified existing tax increment financing districts in the past. BACKGROUND The purpose of the restatement is outlined in the attached July 15, 2002, memorandum from Krass Monroe, P.A. The resolution states, in part, that: · It has been proposed that the EDA approve and adopt the restatement of the Redevelopment Plans for the Master Modification and redesignate the Master Modification as Redevelopment Project No. 1. · It has been further proposed that the EDA approve and adopt the proposed modifications to the Restated Redevelopment Plan (the "Plan") for Redevelopment Project No. I (the "Project Area") reflecting increased geographic area, increased project costs and increased bonding authority pursuant to and in accordance with Minnesota Statutes. · It has been further proposed that the EDA approve and adopt the proposed modifications to the Tax Increment Financing Plans (the "Existing TIF Plans") for Tax Increment Financing Districts Nos. 80-2, 81-1, 82-1, 85-1, 85-2 and 86-1 (the "Existing TIF Districts") reflecting increased geographic area, increased project costs and increased bonding authority within the Project Area pursuant to and in accordance with Minnesota Statutes. MOTION BY J./~r./.f_.~ ~ SECOND BY ~~ · o: ! Request for Action Page 2 9-09-02 · It has been further proposed that the EDA approve the creation of proposed Tax Increment Financing District No. 02-1 for the Navarre/Ahrens project (the "Proposed TIF District") within the Project Area and approve and adopt the proposed Tax Increment Financing Plan (the "Proposed TIF Plan") relating thereto pursuant to and in accordance with Minnesota Statutes. · The EDA has caused to be prepared and has investigated the facts with respect thereto a modified Plan for the Project Area and modified Existing TIF Plans for the Existing TIF Districts reflecting increased geographic area, increased project costs and increased bonding authority within the Project Area and has performed all actions required by law to be performed prior to the approval and adoption of the modifications to the Plan and Existing TIF Plans and the approval and adoption of the Proposed TIF Plan. · The EDA hereby determines that it is necessary and in the best interests of the City and the EDA at this time to approve and adopt the modifications to the Plan and Existing TIF Plans, to create the Proposed TIF District and to approve and adopt the Proposed TIF Plan. The resolution states the following findings: · The EDA hereby finds that the assistance to be provided through the adoption and implementation of the modified Plan, modified Existing TIF Plans and Proposed TIF Plan (collectively the "Plans") is necessary to assure the development and redevelopment of the Project Area. · The EDA hereby finds that the Plans conform to the general plan for the development and redevelopment of the City as a whole. · The EDA hereby finds that the Plans afford maximum opportunity consistent with the sound needs of the City as a whole for the development and redevelopment of the Project Area by private enterprise and it is contemplated that the development and redevelopment thereof will be carried out pursuant to redevelopment contracts with private developers. The resolution includes the following approvals and adoptions: · The modifications to the Plan reflecting increased geographic area, increased project costs and increased bonding authority within the Project Area are hereby approved and adopted by the Commissioners of the EDA and are forwarded to the New Hope City Council for public hearing, review and approval. · The modifications to the Existing TIF Plans reflecting increased geographic area, increased project costs and increased bonding authority within the Project Area are hereby approved and adopted by the Commissioners of the EDA and are forwarded to the New Hope City Council for public hearing, review and approval. The creation of the Proposed TIF District within the Project Area and the adoption of the Proposed TIF Plan relating thereto are hereby approved and adopted by the Commissioners of the EDA and are forwarded to the New Hope City Council for public hearing, review and approval. ATI'ACHMENTS · Resolution · Restated Redevelopment Plan · July 15 Krass Monroe Memo NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY COUNTY OF HENNEPIN STATE OF MINNESOTA RESOLUTION NO. RESOLUTION RESTATING THE REDEVELOPMENT PLANS FOR THE MASTER MODIFICATION; REDESlGNATING THE MASTER MODIFICATION AS REDEVELOPMENT PROJECT NO. 1; MODIFYING THE RESTATED REDEVELOPMENT PLAN AND TAX INCREMENT FINANCING PLANS FOR REDEVELOPMENT PROJECT NO. 1 AND TAX INCREMENT FINANCING DISTRICTS NOS. 80-2, 81-1, 82-1, 85-1, 85-2 AND 86-1; CREATING TAX INCREMENT FINANCING DISTRICT NO. 02-1 AND ADOPTING A TAX INCREMENT FINANCING PLAN RELATING THERETO. BE IT RESOLVED by the Board of Commissioners (the "Commissioners") of the New Hope Economic Development Authority (the "EDA"), as follows: Section 1. Recitals. 1.01. It has been proposed that the EDA approve and adopt the restatement of the Redevelopment Plans for the Master Modification. 1.02. It has been further proposed that the EDA redesignate the Master Modification as Redevelopment Project No 1. 1.03. It has been further proposed that the EDA approve and adopt the proposed modifications to the Restated Redevelopment Plan (the "Plan") for Redevelopment Project No. 1 (the "Project Area") reflecting increased geographic area, increased project costs and increased bonding authority pursuant to and in accordance with Minnesota Statutes, Sections 469.001 to 469.047, 469.124 to 469.134 and 469.090 to 469.108, inclusive, as amended and supplemented from time to time. 1.04. It has been further proposed that the EDA approve and adopt the proposed modifications to the Tax Increment Financing Plans (the "Existing TIF Plans") for Tax Increment Financing Districts Nos. 80-2, 81-1, 82-1, 85-1, 85-2 and 86-1 (the "Existing TIF Districts") reflecting increased geographic area, increased project costs and increased bonding authority within the Project Area pursuant to and in accordance with Minnesota Statutes, Sections 469.174 to 469.179 and 469.090 to 469.108, inclusive, as amended and supplemented from time to time. 1.05. It has been further proposed that the EDA approve the creation of proposed Tax Increment Financing District No. 02-1 (the "Proposed TIF District") within the Project Area and approve and adopt the proposed Tax Increment Financing Plan (the "Proposed TIF Plan") relating thereto pursuant to and in accordance with Minnesota Statutes, Sections 469.17'4 to 469.179 and 469.090 to 469.108, inclusive, as amended and supplemented from time to time. 1.06. The EDA has caused to be prepared and has investigated the facts with respect thereto a modified Plan for the Project Area and modified Existing TIF Plans for the Existing TIF Districts reflecting increased geographic area, increased project costs and increased bonding authority within the Project Area, and a Proposed TIF Plan for the Proposed TIF District defining more precisely the property to be included, the public costs to be incurred and other matters relating thereto. 1.07. The EDA has performed all actions required by law to be performed prior to the approval and adoption of the modifications to the Plan and Existing TIF Plans and the approval and adoption of the Proposed TIF Plan. 1.08. The EDA hereby determines that it is necessary and in the best interests of the City and the EDA at this time to approve and adopt the modifications to the Plan and Existing TIF Plans, to create the Proposed TIF District and to approve and adopt the Proposed TIF Plan relating thereto. Section 2. Findings. 2.01. The EDA hereby finds that the assistance to be provided through the adoption and implementation of the modified Plan, modified Existing TIF Plans and Proposed TIF Plan (collectively the "Plans") is necessary to assure the development and redevelopment of the Project Area. 2.02. The EDA hereby finds that the Plans conform to the general plan for the development and redevelopment of the City as a whole. 2.03. The EDA hereby finds that the Plans afford maximum opportunity consistent with the sound needs of the City as a whole for the development and redevelopment of the Project Area by private enterprise and it is contemplated that the development and redevelopment thereof will be carried out pursuant to redevelopment contracts with pdvate developers. Section 3. Approvals and Adoptions. 3.01. The modifications to the Plan reflecting increased geographic area, increased project costs and increased bonding authority within the Project Area are hereby approved and adopted by the Commissioners of the EDA and are forwarded to the New Hope City Council for public hearing, review and approval. 3.02. The modifications to the Existing TIF Plans reflecting increased geographic area, increased project costs and increased bonding authority within the Project Area are hereby approved and adopted by the Commissioners of the EDA and are forwarded to the New Hope City Council for public hearing, review and approval. 3.03. The creation of the Proposed TIF District within the Project Area and the adoption of the Proposed TIF Plan relating thereto are hereby approved and adopted by the Commissioners of the EDA and are forwarded to the New Hope City Council for public hearing, review and approval. Section 4. Filin,q of Plans. 4.01. Upon approval and adoption of the Plans, the EDA shall cause said Plans to be filed with the Minnesota Department of Revenue. Adopted by the Commissioners of the EDA this day of ,2002. YES: NO: ABSENT: ATTEST: President Executive Director CERTIFICATION I, , Executive Director of the New Hope Economic Development Authority, County of Hennepin, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. adopted by the EDA on the day of ,2002. G:WVPDATA~N~IEW HOPL~08~TIF'~EDA RESOLUTION.DOC Executive Director RESTATED REDEVELOPMENT PLAN for REDEVELOPMENT PROJECT NO. 1 including TAX INCREMENT FINANCING PLANS for TAX INCREMENT FINANCING DISTRICTS NOS. 80-2, 81-1, 82-1, 85-1, 85-2, 86-1, 02-1 NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY CITY OF NEW HOPE COUNTY OF HENNEPIN STATE OF MINNESOTA APPROVED BY THE BOARD OF COMMISSIONERS AND CITY COUNCIL SEPTEMBER 9, 2002 Prepared By: Krass Monroe, P.A. Suite 1100 Southpoint Office Center 1650 West 82nd Street Bloomington, MN 55431-1447 (952) 885-5999 ACTION TAKEN Based upon the statutory authority described in the Restated Redevelopment Plan attached hereto, the public purpose findings by the Commissioners of the Housing and Redevelopment Authority in and for the City of New Hope (the "HRA') and of the New Hope Economic Development Authority (the "EDA), and the City Council of the City of New Hope (the "City"), and for the purpose of fulfilling the development and redevelopment objectives as set forth in the Restated Redevelopment Plan, Redevelopment Project No. 1 has been designated and created pursuant to and in accordance with the requirements of Minnesota Statutes, Sections 469.001 to 469.047 and 469.090 to 469.1082. The following official actions were taken in connection therewith: Master Modification July 25, 1994: The Tax Increment Financing Plans for Tax Increment Financing Districts Nos. 80-2, 81-1, 82-1, 85-1, 85-2, 86-1 and the Redevelopment Plans for Redevelopment Projects Nos. 80-2, 81-1, 82-1, 85-1, 85-2, 86-1 were merged into a Master Modification and modified to reflect increased geographic area, increased project costs and increased bonding authority. October 9, 1995: The Master Modification was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. February 24, 1997: The Master Modification was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. April 28, 1997: The Master Modification was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. July 27, 1998: The Master Modification was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. June 28, 1999: The Master Modification was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. September 9, 2002: The Master Modification was modified by the EDA and City to designate the Redevelopment Plans for Redevelopment Projects Nos. 80-2, 81-1, 82-1, 85-1, 85-2 and 86-1 as the Restated Redevelopment Plan and Redevelopment Project No. 1, respectively. Redevelopment Proiect No. 1 September 9, 2002: Redevelopment Project No. 1 was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. Tax Increment Financing District No. 80-2 (Hillsboro & 36th Avenue) August 11, 1980: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 and the Redevelopment Plan for Redevelopment Project 80-2 were adopted by the HRA and City. April 10, 1989: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 and the Redevelopment Plan for Redevelopment Project 80-2 were transferred from the HRA to the EDA. July 25, 1994: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 and the Redevelopment Plan for Redevelopment Project No. 80-2 were merged by the EDA and City into a Master Modification and modified to reflect increased geographic area, increased project costs and increased bonding authority. October 9, 1995: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 and the Redevelopment Plan for Redevelopment Project No. 80-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. February 24, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 and the Redevelopment Plan for Redevelopment Project No. 80-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. April 28, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 and the Redevelopment Plan for Redevelopment Project No. 80-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. July 27, 1998: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 and the Redevelopment Plan for Redevelopment Project No. 80-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. June 28, 1999: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 and the Redevelopment Plan for Redevelopment Project No. 80-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. September 9, 2002: The Tax Increment Financing Plan for Tax Increment Financing District No. 80-2 was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within Redevelopment Project No. 1. Tax Increment Financing District No. 81-1 (Senior Housing) April 27, 1981' The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 and the Redevelopment Plan for Redevelopment Project No. 81-1 were adopted by the HRA and City. March 28, 1988: The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 and the Redevelopment Plan for Redevelopment Project No. 81-1 were modified by the HRA and City to reflect increased geographic area, increased project costs and increased bonding authority. April 10, 1989: The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 and the Redevelopment Plan for Redevelopment Project 81-1 were transferred fi.om the HRA to the EDA. July 25, 1994: The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 and the Redevelopment Plan for Redevelopment Project No. 81-1 were merged by the EDA and City into a Master Modification and modified to reflect increased geographic area, increased project costs and increased bonding authority. October 9, 1995: The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 and the Redevelopment Plan for Redevelopment Project No. 81-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. February 24, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 and the Redevelopment Plan for Redevelopment Project No. 81-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. Alr)ril 28, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 and the Redevelopment Plan for Redevelopment Project No. 81-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. July 27, 1998: District No. 81-1 and modified by the EDA and increased bonding The Tax Increment Financing Plan for Tax Increment Financing the Redevelopment Plan for Redevelopment Project No. 81-1 were and City to reflect increased geographic area, increased project costs authority within the Master Modification. .June 28, 1999: The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 and the Redevelopment Plan for Redevelopment Project No. 81-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. Tax Increment Financing District No. 81-1 (Senior Housing) Continued September 9, 2002: The Tax Increment Financing Plan for Tax Increment Financing District No. 81-1 was modified by the EDA and City to reflect increased geographic area. increased project costs and increased bonding authority within Redevelopment Project No. 1. Tax Increment Financing District No. 82-1 (Northrid~.e) August 9, 1982: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were adopted by the HRA and City. October 25, 1982: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the HRA and City to reflect increased geographic area, increased project costs and increased bonding authority. November 8, 1982: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the HRA and City to reflect increased geographic area, increased project costs and increased bonding authority. April 10, 1989: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project 82-1 were transferred from the HRA to the EDA. October 23, 1989: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. July 27, 1992: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. July 25, 1994: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were merged by the EDA and City into a Master Modification and modified to reflect increased geographic area, increased project costs and increased bonding authority. October 9, 1995: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. February 24, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. Tax Increment Financing District No. 82-1 (Northridge) Continued April 28, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. July 27, 1998: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. June 28, 1999: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 and the Redevelopment Plan for Redevelopment Project No. 82-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. September 9, 2002: The Tax Increment Financing Plan for Tax Increment Financing District No. 82-1 was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within Redevelopment Project No. 1. Tax Increment Financing District No. 85-1 (Elderlv Apartments) November 12, 1985: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 and the Redevelopment Plan for Redevelopment Project No. 85-1 were adopted by the HRA and City. April 10, 1989: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 and the Redevelopment Plan for Redevelopment Project 85-1 were transferred from the HRA to the EDA. October 11, 1993: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 and the Redevelopment Plan for Redevelopment Project No. 85-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority. July 25, 1994: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 and the Redevelopment Plan for Redevelopment Project No. 85-1 were merged by the EDA and City into a Master Modification and modified to reflect increased geographic area, increased project costs and increased bonding authority. October 9, 1995: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 and the Redevelopment Plan for Redevelopment Project No. 85-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. February 24, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 and the Redevelopment Plan for Redevelopment Project No. 85-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. April 28, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 and the Redevelopment Plan for Redevelopment Project No. 85-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. July 27~ 1998: District No. 85-1 and modified by the EDA and increased bonding The Tax Increment Financing Plan for Tax Increment Financing the Redevelopment Plan for Redevelopment Project No. 85-1 were and City to reflect increased geographic area, increased project costs authority within the Master Modification. June 28, 1999: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 and the Redevelopment Plan for Redevelopment Project No. 85-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. Tax Increment Financing District No. 85-1 (Elderly Apartments) Continued September 9, 2002: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-1 was modified by the EDA and City to reflect increased geo~aphic area, increased project costs and increased bonding authority within Redevelopment Project No. 1. Tax Increment Financing District No. 85-2 (42nd Avenue) December 23, 1985' The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 and the Redevelopment Plan for Redevelopment Project No. 85-2 were adopted by the HRA and City. June 22, 1987: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 and the Redevelopment Plan for Redevelopment Project No. 85-2 were modified by the HRA and City to reflect increased geographic area, increased project costs and increased bonding authority. April 10, 1989: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 and the Redevelopment Plan for Redevelopment Project 85-2 were transferred from the HRA to the EDA. July 25, 1994: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 and the Redevelopment Plan for Redevelopment Project No. 85-2 were merged by the EDA and City into a Master Modification and modified to reflect increased geographic area, increased project costs and increased bonding authority. October 9, 1995: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 and the Redevelopment Plan for Redevelopment Project No. 85-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. February 24, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 and the Redevelopment Plan for Redevelopment Project No. 85-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. April 28, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 and the Redevelopment Plan for Redevelopment Project No. 85-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. July 27, 1998: District No. 85-2 and modified by the EDA and increased bonding The Tax Increment Financing Plan for Tax Increment Financing the Redevelopment Plan for Redevelopment Project No. 85-2 were and City to reflect increased geographic area, increased project costs authority within the Master Modification. June 28, 1999: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 and the Redevelopment Plan for Redevelopment Project No. 85-2 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. Tax Increment Financing District No. 85-2 (42nd Avenue) Continued September 9, 2002: The Tax Increment Financing Plan for Tax Increment Financing District No. 85-2 was modified by the EDA and City to reflect increased geo~aphic area, increased project costs and increased bonding authority within Redevelopment Project No. 1. Tax Increment Financing District No. 86-1 (36th Avenue Apartments) June 23, 1986: The Tax Increment Financing Plan for Tax Increment Financing District No. 86-1 and the Redevelopment Plan for Redevelopment Project No. 86-1 were adopted by the HRA and City. April 10, 1989: The Tax Increment Financing Plan for Tax Increment Financing District No. 86-1 and the Redevelopment Plan for Redevelopment Project 86-1 were transferred from the HRA to the EDA. July 25, 1994: The Tax Increment Financing Plan for Tax Increment Financing District No. 86-1 and the Redevelopment Plan for Redevelopment Project No. 86-1 were merged by the EDA and City into a Master Modification and modified to reflect increased geographic area, increased project costs and increased bonding authority. October 9, 1995: The Tax Increment Financing Plan for Tax Increment Financing District No. 86-1 and the Redevelopment Plan for Redevelopment Project No. 86-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. February 24, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 86-1 and the Redevelopment Plan for Redevelopment Project No. 86-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. April 28, 1997: The Tax Increment Financing Plan for Tax Increment Financing District No. 86-1 and the Redevelopment Plan for Redevelopment Project No. 86-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. July 27, 1998: District No. 86-1 and modified by the EDA and increased bonding The Tax Increment Financing Plan for Tax Increment Financing the Redevelopment Plan for Redevelopment Project No. 86-1 were and City to reflect increased geographic area, increased project costs authority within the Master Modification. June 28, 1999: The Tax Increment Financing Plan for Tax Increment Financing District No. 86-1 and the Redevelopment Plan for Redevelopment Project No. 86-1 were modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within the Master Modification. September 9, 2002: The Tax Increment Financing Plan for Tax Increment Financing District No. 86-1 was modified by the EDA and City to reflect increased geographic area, increased project costs and increased bonding authority within Redevelopment Project No. 1. Tax Increment Financing District No. 02-1 (Navarre Project) September 9, 2002: The Tax Increment Financing Plan for Tax Increment Financing District No. 02-1 was adopted by the EDA and City. TABLE OF CONTENTS (This Table of contents is not part of the Restated Redevelopment Plan: it is only for convenience of reference.) ARTICLE I. Section 1.1. Section 1.2. Section 1.3. Section 1.4. Section 1.5. Section 1.6. Section 1.7. Section 1.8. Section 1.9. Section 1.10. Section 1.11. Exhibit I-A Exhibit I-B RESTATED REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 1 Definitions Statement and Finding of Public Purpose Statutory Authority Statement of Objectives Estimated Project Costs and Revenues Environmental Control Administration and Maintenance Rehabilitation Relocation Boundaries Parcels to be Acquired Estimated Project Costs and Revenues Parcels to be Included 1-1 1-3 1-4 1-4 1-6 1-6 1-6 1-7 1-7 1-7 1-7 I-A-1 I-B-1 Exhibit I-C Boundary Map I-C- 1 ARTICLE II. Section 2.1. Section 2.2. Section 2.3. Section 2.4. Section 2.5. Section 2.6. Section 2.7. Section 2.8. Section 2.9. Section 2.10. Section 2.11. Section 2.12. Section 2.13. Section 2.14. Section 2.15. Section 2.16. Section 2.17. Section 2.18. TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 02-1 (NAVARRE PROJECT) Statement of Objectives Redevelopment Plan Parcels to be Included Parcels in Acquisition Development Activity for which Contracts have been Signed Specific Development Expected to Occur Prior Planned Improvements Fiscal Disparities Estimated Project Costs Estimated Amount of Indebtedness Sources of Revenue Estimated Original and Captured Tax Capacities Tax Rate Tax Increment Type of TIF District Duration of'TIF District Estimated Impact on Other Taxing Jurisdictions Modification of TIF District and/or TI1e Plan 2-1 2-1 2-1 2-1 2-1 2-1 2-1 2-2 2-2 2-2 2-2 2-2 2-2 2-2 2-2 2-2 2-3 2-3 Exhibit II-A Exhibit II-B Exhibit II-C Exhibit II-D Exhibit II-E Parcels Included in TIF District Boundary Map of T1F District Cash Flow Analysis "But For" Analysis Estimated Impact on Other Taxing Jurisdictions II-A-1 II-B-1 II-C-1 II-D-1 II-E-1 ARTICLE I RESTATED REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 1 Section 1.1. Definitions. The terms defined below shall, for purposes of this Restated Redevelopment Plan and attached Tax Increment Financing Plans, have the meanings herein specified, unless the context otherwise specifically requires; "City" means the City of New Hope, a municipal corporation and political subdivision of the State of Minnesota. "Comprehensive Plan" means the City's comprehensive plan which contains the objectives, policies, standards and programs to guide public and private land use, development, redevelopment and preservation for all lands and water within the City. "Council" means the City Council of the City. "County" means the County of Hennepin, Minnesota. "Economic Development Authority" and "EDA" mean an economic development authority created or authorized to be created by Minnesota Statutes, Sections 469.090 to 469.1082. "Economic Development Authority Act" or "EDA Act" means the statutory provisions of Minnesota Statutes, Sections 469.090 to 469.1082, inclusive, as amended and supplemented from time to time. "EDA Authority" means the New Hope Economic Development Authority, also referred to as the Economic Development Authority in and for the City of New Hope, Minnesota.. "EDA Commissioners" means the Commissioners of the EDA. "Housing and Redevelopment Authority" and "HRA" mean a housing and redevelopment authority created or authorized to be created by Minnesota Statutes, Sections 469.001 to 469.047. "Housing and Redevelopment Authority Act" or "HRA Act" means the statutory provisions of Minnesota Statutes, Section 469.001 to 469.047, inclusive, as amended and supplemented from time to time. 1-1 "HRA Authority" means the Housing and Redevelopment Authority in and for the City of New Hope. "HRA Commissioners" means the Commissioners of the HRA. "Land Use Regulations" means all federal, state and local laws, rules, regulations, ordinances and plan relating to or governing the use or development of land in the City, including but not limited to environmental, zoning and building code laws and regulations. "Master Modification" means the combined areas subject to the Redevelopment Plans and Redevelopment Projects adopted and created prior to September 9, 2002. "Plan" means the Restated Redevelopment Plan for the Project Area. "proiect" means Redevelopment Project No. 1 and the public improvements and facilities to be constructed therein, as more fully described in Article I, Section 1.5. of the Restated Redevelopment Plan. "Project Area" means the real property located within the geographic boundaries of Redevelopment Project No. 1. "Public Costs" means the costs eligible to be financed by tax increments under Minnesota Statutes, Section 469.176, Subdivision 4. "Redevelopment Plans" means the Redevelopment Plans for Redevelopment Projects Nos. 80-2, 81-1, 82-1, 85-1, 85-2, or 86-1. "Redevelopment Projects" means Redevelopment Projects Nos. 80-2, 81-1, 82-1, 85- 1, 85-2, and 86-1 initially approved by the City and HRA and subsequently transferred from the HRA to the EDA. "Redevelopment Project No. 1" means the area previously included in the Master Modification, hereinafter known as the Restated Redevelopment Plan, the additional area added at the time of the adoption of the Restated Redevelopment Plan and any area as may be added from time to time. "Restated Redevelopment Plan" means this Plan as described in Article 1. "School District" means Independent School District No. 281. ".State" means the State of Minnesota. 1-2 "Tax Increment Bonds" means the general obligation or revenue tax increment bonds issued and to be issued by the City to finance the public costs associated with Redevelopment Project No, 1 as stated in the Restated Redevelopment Plan and in the Tax Increment Financing Plan for each of the Tax Increment Financing Districts within Redevelopment Project No, 1. The term "Tax Increment Bonds "shall also include any obligations issued to refund the Tax Increment Bonds. "Tax Increment Financing Act" or "Tax Increment Act" means the statutory provisions of Minnesota Statutes, Sections 469.174 to 469.1791, inclusive, as amended and supplemented from time to time. "Tax Increment Financing District" means any Tax Increment Financing District presently established or to be established in the Project Area. "Tax Increment Financing Plan" means the respective Tax Increment Financing Plan for each Tax Increment Financing District located within the Project Area. Section 1.2. Statement and Finding of Public Purpose. In August of 1980 the HRA Commissioners of the HRA Authority determined that there was a need to undertake certain actions designed to encourage, ensure and facilitate the private sector to (1) develop and redevelop underutilized and unused land located within the corporate limits of the City; (2) improve the tax base of the City, the County and the School District thereby enabling them to better utilize existing public facilities and provide needed public services; (3) improve the general economy of the City, the County, the School District and the State; and, (4) provide additional employment opportunities for residents of the City and surrounding area. It was found that there were certain parcels of property within the City which were potentially more useful, productive and valuable than was being realized under existing conditions and therefore were not contributing to the tax base of the City, the County, the School District and the State to their full potential. The HRA Commissioners determined that said parcels of property were deemed to be vacant, underutilized, or blighted due to poor planning and subdivision and zoning practices, and to existing structures which because of (i) dilapidation, (ii) obsolescence, (iii) overcrowding, (iv) faulty arrangement or design, (v) lack of ventilation, light and sanitary facilities, (vi) excessive land coverage, (vii) inadequate land coverage, (viii) deleterious land use or (ix)obsolete layout, or (x) any combination of these or other factors, were detrimental to the safety, health, morals or welfare of the City, pursuant to the HRA Act. Therefore, the HRA Commissioners determined it was necessary to exercise its authority to develop, implement and finance a Plan for improving the Project Area to (1) provide an impetus for private development and redevelopment; (2) maintain and increase 1-3 employment; (3) utilize existing potential; and, (4) provide other facilities as outlined in Section 1.4. of the Plan. The HRA Commissioners also determined (1) that the proposed development or redevelopment would not occur solely through private investment in the foreseeable future; (2) that the Tax Increment Financing Plans proposed herein were consistent with the Plan; (3) that the Tax Increment Financing Plans would afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of the Project Area by private enterprise; and (4) that the Plan conformed to the comprehensive plan of the City. The I-IRA Commissioners further determined that the welfare of the City as well as the State required active promotion, attraction, encouragement and development of economically sound housing, industry and commerce to carry out its stated public purpose objectives. Subsequently the City established an EDA Authority and on April 10, 1989 the HRA Commissioners transferred control, authority and operation of its Redevelopment Projects and Tax Increment Financing Districts to the EDA Authority At the time of this transfer, the EDA Commissioners reaffirmed the statement and finding of public purpose originally set forth by the HRA Commissioners. At the time of the adoption of the Plan, the EDA Commissioners again affirmed the statement and finding of public purpose. Section 1.3. Statutory Authority. The HRA Commissioners determined that it was desirable and in the public interest to designate a specific area within the corporate limits of the City as the Project Area and to establish, develop and implement a Plan pursuant to the provisions of the HRA Act, as amended and supplemented from time to time. Upon its receipt of the Redevelopment Projects and Tax Increment Financing Districts from the HRA Authority, the EDA Commissioners supported the HRA Commissioners' determinations pursuant to the provisions of the EDA Act, as amended and supplemented from time to time. Funding of the necessary activities and improvements in the Project Area was and shall be accomplished, in part, with any funds the HRA Authority had and the EDA Authority may have available from any source, including funds made available by the City and through tax increment financing in accordance with the Tax Increment Act. The Tax Increment Act authorized the establishment of tax increment financing districts within the Project Area, pursuant to the requirements as set forth in Section 469.174. The Tax Increment Act also set forth the procedures and requirements necessary to establish tax increment financing districts, designated the types of tax increment financing districts to be created, and established the limitations and requirements that applied to the activities and 1-4 public improvements which can be financed for each type of tax increment financing district. Section 1.4. Statement of Obiectives. The HRA Commissioners originally determined, and its determinations were reaffirmed by the EDA Commissioners, that the establishment of the Project Area would provide the City with the ability to achieve certain public purpose goals not otherwise obtainable in the foreseeable future without intervention in the normal development or redevelopment process. These public purpose goals included: (1) restoration and improvement of the tax base and tax revenue generating capacity of the Project Area; (2) increased employment opportunities; (3) realization of comprehensive planning goals; (4) removal of blighted conditions; and, (5) revitalization of the property within the Project Area to create an attractive, comfortable, convenient and efficient area for housing, industrial, commercial and related uses. The Plan objectives originally established by the HRA Commissioners and restated by the EDA Commissioners and further affirmed by this Plan include the following: 1. Promote and secure the prompt development or redevelopment of certain property in the Project Area, which property is not now in productive use or in its highest and best use, in a manner consistent with the City's comprehensive plan and with a minimum adverse impact on the environment and thereby promote and secure the development of other land in the City. 2. Promote and secure additional employment opportunities within the Project Area and the City for residents of the City and surrounding area, thereby improving living standards, reducing unemployment and the loss of skilled and unskilled labor and other human resources in the City. 3. Secure the increased valuation of property subject to taxation by the City, County, School District and other taxing jurisdictions in order to better enable such entities to pay for governmental services and programs required to be provided by them. 4. Provide for the f'mancing and conslruction of public improvements in and adjacent to the Project Area necessary for the orderly and beneficial development or redevelopment of the Project Area and adjacent areas of the City. 5. Promote the concenlration of new desirable residential, commercial, office and other appropriate development or redevelopment in the Project Area so as to maintain the area in a manner compatible with its accessibility and prominence in the City. 6. Encourage local business expansion, improvement, development or redevelopment whenever possible. 1-5 7. Create a desirable and unique character within the Project Area through quality land use alternatives and design quality in new and remodeled buildings. 8. Encourage and provide maximum opportunity for private development or redevelopment of existing areas and structures which are compatible with the Plan. 9. Create viable environments which would upgrade and maintain housing stock, maintain housing health and safety quality standards, and maintain and strengthen individual neighborhoods. 10. Stimulate private activity and investment to stabilize and balance the City's housing supply. 11. Eliminate code violations and nuisance conditions that adversely affect neighborhoods. 12. Revitalize property to create a safe, attractive, comfortable, convenient and efficient area for residential use. 13. Recreate and reinforce a sense of residential place and security which creates neighborhood cohesiveness through City investment in neighborhood infrastructure and public improvements, including landscaping, park improvements, local street modifications to reduce traffic impacts, street repaying, curb and gutter replacement, and streetlight updating. 14. Encourage infill development and redevelopment that is compatible in use and scale with surrounding neighborhoods. 15. Rehabilitate the existing housing stock and preserve existing residential neighborhoods wherever possible. 16. Demolish and reconstruct, where necessary, aging residential buildings to preserve neighborhoods. 17. Removal of substandard structures. Section 1.5. Estimated Proiect Costs and Revenue. The estimated project costs and revenues associated with the Project Area are described on Exhibit I-A. The City may issue Tax Increment Bonds to pay the estimated costs of the public improvements in the amounts described on Exhibit I-A. 1-6 Section 1.6. Environmental Control. The proposed development or redevelopment in the Project Area does not present significant environmental concerns. All municipal actions, public improvements and private development or redevelopment shall be carried out in a manner consistent with existing environmental standards. Section 1.7. Administration and Maintenance. Maintenance and operation of the public improvements will be the responsibility of the City Manager who shall also serve as Administrator of the Project Area. Each year the Administrator will submit to the EDA Authority the maintenance and operation budget for the following year. The Administrator will administer the Project Area pursuant to the provisions of the Act and the Tax Increment Act; provided, however, that such powers may only be exercised at the direction of the EDA Authority. No action taken by the Administrator pursuant to the aforementioned powers shall be effective without authorization by the EDA Authority. Section 1.8. Rehabilitation. Owners of properties within the Project Area will be encouraged to rehabilitate their properties to conform with the applicable state and local codes and ordinances, as well as any design standards. Owners of properties who purchase property within the Project Area from the City may be required to rehabilitate their properties as a condition of sale of land. The EDA Authority will provide such rehabilitation assistance as may be available from federal, state or local sources. A developer or redeveloper may be any person, business, corporation or government unit, including the City. A developer or redeveloper may initiate a plan and participate with the City in the development or redevelopment thereof. Section 1.9 Relocation. The EDA Authority accepts its responsibility for providing for relocation, if and when applicable, pursuant to Minnesota Statutes, Section 469.133. Section 1.10. Boundaries. The boundaries of the Project Area are described on Exhibit I-B and illustrated on Exhibit I-C. Section 1.11. Parcels to be Acquired. The EDA may acquire any of the parcels described on Exhibit I-B. G:\WPDATAhX/hN'EW HOPE~I O~REDL~REDE PLAN.DOC 1-7 EXHIBIT I-A ESTIMATED PUBLIC COSTS AND REVENUES FOR REDEVELOPMENT PROJECT NO. 1 TIF DISTRICT #80-2 AS RESTATED SEPTEMBER 9, 2002 REVENUES Tax Increment Revenue Interest on Invested Funds Bond-Proceeds COSTS Site Improvements/Preparation Costs Installation of Public Utilities Public Park Facilities Bond Principal Payments Bond Interest Payments Administrative Expenses Total TIF DISTRICT #81,1 AS RESTATED SEPTEMBER 9, 2002 REVENUES Tax Increment Revenue Interest on Invested Funds Bond Proceeds Other COSTS : ' Land/Building acquisition Site Improvements/Preparation Costs Streets and Sidewalks Bond Principal Payments Bond Interest Payments Administrative Expenses TIF Refunding Bonds Total I-A-1 $ 640,000 205,000 300,000 $ 1,145,000 100,000 120,000 302,776 300,000 252,224 7O,O0O $ 1,145,000 1,270,000 270,000 450,2O6 5,871 1,996,077 150,000 115,000 880,526 145,000 248,251 95,000 362,300 1,996,077 BUDGET.xls EXHIBIT I-A - CONTINUED TIF DISTRICT #82-1 AS RESTATED SEPTEMBER 9, 2002 REVENUES Tax Increment Revenue Interest on Invested Funds Bond Proceeds COSTS Site Improvements/Preparation Costs Public Park Facilities Social, Recreational, or Conference Facilitie~ Interest Reduction Payments Bond Principal Payments Bond Interest Payments Administrative Expenses TIF Refunding Bond Total TIF DISTRICT #85-1 AS RESTATED SEPTEMBER 9, 2002 REVENUES Tax Increment Revenue Interest on Invested Funds Bond Proceeds Other Transfers In COSTS ' Site Improvements/Preparation Costs Social, Recreational, or Conference Facilities Interest Reduction Payments Bond Principal Payments Bond Interest Payments Administrative Expenses TIF Refunding Bond Total 25,827,000 1,600,000 3,000,000 30,427,000 11,724,287 3,000,000 7,800,000 1,619,275 1,450,000 1,205,815 1,203,000 2,424,623 30,427,000 2,000,000 50,000 407,750 60O 89,000 2,547,350 465,000 432,494 633,104 135,000 246,057 220,000 415,695 2,547,350 BUDGET.xls EXHIBIT I-A - CONTINUED TIF DISTRICT #85-2 AS RESTATED SEPTEMBER 9, 2002 REVENUES Tax Increment Revenue Interest on Invested Funds Bond Proceeds Special Assessments County Aid Transfers in COSTS Land/Building Acquisition Site improvements/Preparation Costs Social, Recreational, or Conference Facilities Bond Principal Payments Bond Interest Payments Administrative Expenses TIF Refunding Bond Total TIF DISTRICT #86-1 AS RESTATED SEPTEMBER 9, 2002 REVENUES Tax Increment Revenue Interest on Invested Funds Bond Proceeds COSTS ' Site Improvements/Preparation Costs Social, Recreational, or Conference Facilities Bond Principal Payments Bond Interest Payments Administrative Expenses TIF Refunding Bond Total 4,545,000 520,000 2,356,501 550,000 412,103 244,359 8,627,963 500,000 3,545,000 43O,572 1,185,000 721,399 560,000 1,685,992 8,627,963 3,249,465 600,000 1,735,000 5,584,465 1,457,350 671,905 835,000 878,298 400,000 1,341,912 5,584,465 BUDGET.xls EXHIBIT I-A - CONTINUED TIF DISTRICT 1/02-1 AS ADOPTED SEPTEMBER 9, 2002 The total project costs associated with this portion of Redevelopment Project No. 1 are estimated at $11,000,000. The public portion of these costs and their associated revenues are estimated below. REVENUES Tax Increment Revenue Bond Proceeds COSTS Land/Building Acquisition Site Improvements/Preparation Costs Installation of Public Utilities Parking Facilities Bond Principal Payments Bond Interest Payments Loan/Note Interest Payments Administrative Expenses Contingency Total $ 1,532,676 400,000 1,932,676 250,000 200,000 350,000 50,000 400,000 200,000 300,000 160,000 22,676 $ 1,932,676 BUDGET.xls EXHIBIT I-B PARCELS IN THE PROJECT AREA AS RESTATED AND MODIFIED AS OF SEPTEMBER 9, 2002 :06-118-21-43-0014 06-118-21-43-0015 05-118-21-21-0004 05-118-21-31-0111 05-118-21-33-0095 05-118-21-21-0005 05-118-21-32-0003 05-118-21-33-0096 '05-118-21-21-0006 05-118-21-32-00~ ..... 0-5-118-21-33-0097 '-06-118-21-43-0016 05-118-21-21-0007 05-118-21-32-0005 05-118-21-33-0098 05-118-21-43-0017 '05-118-21-21-0008 05-118-21-32-0006 05-118-21-33-0099 05-115-21-43-0018 :0~ ~ 1-8~-2-'~;~--(~{~0~ .......... i (~'-i' 8~-~3~.-00~);7 ............ ~ ~',~ ~ ~ ~ ~2'~T..~.L~) 0 ~ -:1' ............ ~)-6~ :1-1'~ - 2 '~-~43'0 ~) 1 g ..... :05-118-21-21-0010 05-118-21-21-0011 : 05-118-21-32-0008 05-118-21-33-0002 05-118-21-13-0075 06-118-21-43-0020 :06-118-2 :~ ~'1"3;~0~'6 ...... 05-118-21-21-0012 05-118-21-33-0003 ~ 05-118-21-13-0079 106-118-21-43-0022 !05-118-21-21-0013 :05-118-21-33-0004 ~ 06-118-21-13-0080 106-118-21-43-0023 ,05-118-21-21-0014 05-118-21-33-0006 ;05-118-21-13-0090 ~06-118-21-43-0024 105-118-21-21-0015 ;05-118-21-33-0007 ~ 06-118-21-13-0091 '05-118-21-43-0025 05-118-21-21-0016 ~05-118-21-33-0015 ;06-118-21-33-0001 ;05-118-21-43-0026 ~05-118-21-21-0018 ~05-118-21-33-0017 ~05-118-21-33-0010 !05-118-21-43-0028 ,05-118-21-21-001g 05-118-21-33-0018 ~ 06-118-21-34-0006 :06-118-21-43-002g 05-118-21-21-0020 :05-118-21-33-0019 ;06-118-21-3~-'0008 106-118-21-43-0030 ~ 05-118-21-21-0021 ~05-118-21-33-0020 :06-118-21-34-0009 '06-118-21-43-0031 ~ 05-118-21-21-0022 ~ 05-118-21-33-0021 !06-118-21-34-0019-- ~ 06-118-21-43-0032 ~0_5;].~._8_-2.122.1_-.0_0.23- ....... !~OS-118-21-33-0022 '05-118-21-41-0005 . i05-115-21-43-0033 '05-118-21-21-0024 ' i0~-~-7~'1.~3~,~00'23 ...... i~6-~-1'8'~,'i-~1'~)~'~)-6 ~-0-6'~'~-~-~--~3'~03~- ~05~'~i~'8:~'~':~ ~i':6'(~'~' ......... ; 0 ~.¥:~' ~-~§:~'~)~;~- ..... ~ ~ ~L-iT'~L~ :~' ~4- ~ ~-0-~ ~-7~ .......... 70~.~"~'§~',~(~ ........ .05-118-21-21-0033 05-118-21-33-0025 ~06-11s-21-41-0008 !06-118-21-43-0036-- :05-118-21-21-0034 :05-118-21-33-0026 ;06-118-21-41-0009 :06-118-21-43-0037 05-118-21-21-0035 05-118-21-33-0027 106-118-21-41-0010 :06-118-21-44-0001 05-118-21-21-0036 05-118-21-33-0028__ !06-118-21-41-0011 ! 0~- ~ 1-'~ 1--;t~2~)~3-(~'~-- --'- ;05-118-21-21-0037~ ~ 05-118-21-33-0029 !06-118-21-41-0012 :06-118-21-44-0003 105-118-21-21-0038 05-118-21-33-0030 !06-118-21-42-0001 ~ 05-118-21-44-0004 ;05-118-21-21-0039 !05-118-21-33-0032 106-118-21-42-0008 '~ 05-118-21-44-0005 105-118-21-21-0040 105-118-21-33-0033 ~ 06-118-21-42-0009 i06-118-21-~0006 ;05-118-21-21-0109 !05-118-21-33-0034 !06-118-21-42-0010 ',06-118-21-44-0007 105-118-21-21-0110 i05-118-21-33-0035 106-118-21-4Z.-~0011 i06-118-21-44-0008 !05-118-21-21-0112 :05-118-21-33-0036 i06-118-21-42-0012 !05-115-21-44-0009 i05-118-21-21-0114 i05-118-21-33-0037 106-118-21-42-0035 i06-118-21-~d 0010 105-118-21-21-0115 105-118-21-33-0039 !06-118-21-42-0036 ', 06-118-21-~d 0011 !05-118-2.1-22-0014 i05-118-21-33-0040 f06-118-21-42-0045 i06-11R-21-44-0012 i05-118-21-22-0058 !05-118-21-33-0045 !05-__11__8_T~_1-42-0046 i06-118-21-44-0013 !05-118-21-22-0059 i05-118-21-33-0046 !06-118-21-43-0002 ~06-118-21 ~-0014 i05-118-21-22-0060 i05-118-21-33-0047 !06-118-21-43-0003 I05-118-21-~ 0015 i05-115-21-22-0061 i 05-118-21-33..0048 !06-118-21-43-0004 ' t06-118-21~ 0016 ! 0,__~5-118-21-22-0062 i05-118-21-33.0082 t06-118-21-43-0005 !06-118-21~d-0017 105-118-21-22-0063 i05-118-21-33-0084 106-118-21-43-0006 106-118-21 ~-0018 !05-118-21-22-0064 i05-118-21-33-0085 !06-118-21-43-0007 i06-118-21~ 0019 105-118-21-22-0065 ~05-118-21-33-0086 !05-118-21-33-0087 105-118-21-33-0088 ',05-118-21-33-0089 ~ 05-118-21-33-0091 105-118-21-33-0094 i05-118-21-22-0066 i05-118-21-22-0120 i05-118-21-22-0121 ;05-118-21-24-0001 05-118-21-31.0005 !06-118-21-43-0008 105-118-21-43-0009 i06-118-21-43-0010 i06-118-21-43-0011 i05-118-21-43-0012 106-118-21-43-0013 106-115-21-44-0020 ;05-118-21-44-0021 i06-118-21~d 0023 !06-118-21-44-0024 ;06-118-21~ 0025 !06-118-21-44-0026 I-B-1 EXHIBIT i-B - CONTINUED PARCELS IN THE PROJECT AREA AS_.RES_TAT_E.D_A_ND..M.OD_IF_IED AS OF S_EPTE__MB.E_R_9,_20_02 06-118-21-44-0027 08-118-21-22-0007 .06-118-21-44-0028 08-118-21-22-0008 17-118-21-23-0003 17-118-21-23-0004 17-118-21-31-0003 17-118-21-3'i '0004 .... · 06-118-21-44-0029 08-118-21-22-0009 ' 17-118-21-23-0005 ' 17-118-21-31-0005 06-118-21-44-0030 08-118-21-22-0010 17-118-21-23-0007 ' 17-118-21-31-0006 "{~ ~"i- :1' 8 '2 i--7t4~--00-3 ~-- .... !~)~:1-~ ~?~ ~23~-00D 1 17-118-21-23:0'~)~-- .......17~ i'1-8:2'i'~3~i-~0'0~7- .0~: i'-i"8;~ 1~;0032 ......... ~-8~ ~-~'-2':1':~-3~)00~ ..... /:17~'~'18~2'1-~3;0011 ......... :i'7:i i8-2~i"31-0008 06-118-21-44-0033 :08-118-21-23-0008 : 17-118-21-23-0012 17-118-21-31-0009 ~-0~.-:1-~8-~2i-.~t.0~3-~ ...... ~0~-1-i-8,;~:1~.4.00(~-$- ........ 1~:18~2i.~3-.~)-~-;~ ..... 1:7~:1-18.21L31.00i0· - 06-118-21-44-0035 .08-118-21-24-0006 17-118-21-23-0017 '17-118-21-31-0011 06-118-21-44-0036 08-118-21-24-0011 117-118-21-23-0018 17-118-21-3¥-0012 ~ 06-118-21-44-0037 ~ 08-118-21-33-0005 17-118-21-24-0002 17-118-21-31-0013 :.~6_-_1.1.~8_-21-44-0038 108-118-21-33-0008 ~ 17-118-21-24-0003 17-118-21-31-0014 i...0_ _6L! ?. ~ _-_2...1__-~.......-_0..039 ~ 08-118-21-3~)~)~)~"--; 1~'i~'8-21-24-0004 ,17-118-21-31-00~'~ :06-118-21-44-0041 108-118-21-33-0011 ~ 17-118-21-24-0007 '17-118-21-31-0017 06-118-21-44-0050 :17-118-21-21-0024 : 17-118-21-24-0080 ' 18-118-21-11-0018 ;06-118-21-44-0051 : 17-118-21-21-0025 ;17-118-21-24-0081 18-118-21-12-0005 !'(~--~118.~ :1'~,74'~0 ~ .......... i-~ '~---1":1'~ 1--~--~03 0 ;06-119-21-44-0022 ~17-118-21-21-0031 :17-118-21-24-0083 !19-118-21-22-0119 :07-118-21-14-0057 17-118-21-21-0032 ;17-118-21-24-0084 ; 19-118-21-22-0120 ;07-118-21-14-0058 17-118-21-21-0033 '17-118-21-24-0085 ~ 19-118-21-22-0121 !07-118-21-14-0059 !17-118-21-21-0034 ~ 17-118-21-24-0086 ~ 19-118-21-22-0122 07-118-21-14-0118 !17-118-21-21-0035 ~ 17-118-21-24-0095 ;19-118-21-22-0123 07-118-21-14-0119 1!7-118-21-21-0049 ~ 17-1.18-21-2~0088 ' 19-118-21~22-0124 !07-118-21-14-0120 17-118-21-21-0054 ;17-118-21-24-0089 ~ 19-118-21-22-0125 i07-118-21-14-0121 i17-118-21-22-0005 · 117-118-21-24-0090 19-118-21-22-0126 !07-118-21-14-0122 i 17-118-21-24-0091 19-118-21-22-0127 7-118-21-24-0082 !19-118-21-22-0118 i07-118-21-14-0;123 107-118-2'1-14-0124 i 17-118-21-22-0006 ~17-118-21-22-0007 ~ 17-118-21-22-0008 7-118-21-24-0092 _L1.7- 118-21-24-0093 19-118-21-22-0128 9-118-21-22-0129 !07-118-21-14-0125 -- ~7-118-21-14-0126 i 17-118-21-22-0011 ~ 17-118-21-24-0096 i 19-118-21-22-0130 !.17-118-21-22-0012 ! 17-118-21-24-0097 119-118-21-22-0131 i07-118-21-14-0127 !07-118-21-14-0128 107-118-21-14-0129 !07-118-21-21-0005 ! 07-118-21-23-0022 !07-118-21-41-0001 !08-118-21-22-0003 i08-118-21-22-0004 i08-118-21-22-0005 !08-118-21-22-0006 !17-118-21-22-0013 ! 17-118-21-22-0014 117-118-21-22-0015 ~17-118-21-22-0017 117-118-21-22-0033 !17-118-21-22-0034 i17-118-21-22-0036 117-118-21-22-0037 i 17-118-21-23-0001 i 17-118-21-23-0002 i 17-118-21-24-0098 : 17-118-21-24-0099 ',17-118-21-24-0100 ! 17-118-21-24-0101 117-118-21-24-0102 117-118-21-24-0105 ! 17-118-21-24-0106 i17-118-21-2.4-0108 117-118-21-24-0109 ~17-118-21-31-0002 119-118-21-22-0143 :19-118-21-22-0144 !19-118-21-22-0145 ~ 19-118-21-22-0146 r19-118-21-22-0073 119-118-21-22-0102 ~19-118-21-22-0103 i 19-118-21-22-0104 !19-118-21-22-0105 i19-118-21-22-0106 I-B-2 EXHIBIT I-B - CONTINUED PARCELS IN THE PROJECT AREA AS._RE_S_T_.A_.T~D AND_MO_D_IFIED AS OF SEPTEMBER 9,~2002__ 19-118-21-22-0107 ~ 19-118-21-33-0009 ' 19-118-21-44-0066 -19-118-21-44-0074 19-1-1'8:;~1:22-0'108 .... -19-~ i-8:2 ~--~:~0~)' ..... ~-9 -~1-8-~-1-~1~,: 0~6~ ...... -~-~-~8-~21 -~1~t-0075 19-118-21-22-0109 19-118-21-44-0050 ' 19-118-21-44-0068 '19-118-21-44-0076 19-1 i8-21-22'0110 ...... 19-:11-8:21-44--~051 ...... 19:-i-1'8:2i~44-00~9 - ' 19-:118-21-44:0077 '1-9--¥i§-21---2~-~0:1' ¥1--'-~ : i9 "1' :1-8:'~ i-.~4'--~0-052 19-118-21-44-~0070- ....... 20-118-21-~22--000~ i-9'~i-18~2~22~0'i¥Z{ ........ ;~9~'11-8~2i-~t~0~)-5~ ..... -:'i-{~ ~ ~:1T.44~00~'-;i ........... ~20-'~ :~'8-21-22-0011 '19-118-21-22-0115 '19-118-21-44-0054 19-118-21-44-0072 20-118-21-34-0026 : "i-9:-~'~ ~-2-'~:3 :~:~'{~-1 '1-~ :'~-1~-~'~,~ '00'55' ~'9'-~ 8~'-1--~,~4--0~ ~§- ....... 20- :I 18-2'~---;~4'0033 .... ~ 19-118-21-33-0008 EXHIBIT I-C AS RESTATED AND MODIFIED SEPTEMBER 9, 2002 ~ .... : ~ q~. , ; : . __ . . . '~,;.%,,~ i :-. ii ! .. ,: ..% · '-: .I a-~."'t . ' · g. · /a,I . o ,i.- , '"':' ' '~ :'~:'::'~ : "- '" z--- ' ' .... ': r.. :: ' - ~; :-:' ; -- : " -,I K' '--' ' ....-.. .- .. .~:~.~ ,' · ; !: ." 'f"' ARTICLE II TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 02-1 (NAVARRE PROJECT) Section 2.1 Statement of Objectives. See Article I, Section 1.4, Statement of Objectives. Section 2.2 Redevelopment Plan. See Article I, Sections 1.2 through 1.11. Section 2.3 Parcels to be Included. The boundaries of Tax Increment Financing District No. 02-1 (the "TIF District") are described in Exhibit II-A and illustrated on Exhibit II-B. Section 2.4 Parcels in Acquisition. The EDA Authority may publicly acquire and reconvey any or all of the parcels in the TIF District identified in Exhibit I-B. The following are conditions under which properties not designated to be acquired may be acquired at a future date: (1) The EDA Authority may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of the Tax Increment Financing Plan (the "TIF Plan"); and (2) Such acquisition will be undertaken only when there is assurance of funding to finance the acquisition and related costs. Section 2.5 Development Activity fox' which Contracts have been Signed. As of the date of adoption of the TIF Plan, the EDA Authority contemplates.. entering into a signed contract with Navarre Corporation for the activities discussed below. Section 2.6 Specific Development Expected to Occur. At this time it is anticipated that the construction of a warehouse of up to 130,000 square feet and a warehouse/tracking facility of up to 10,000 square feet will both be completed in 2003. Upon completion of the construction, it is expected that the City's tax base will increase by approximately $6.5 million. Section 2.7 Prior Planned Improvements. The EDA Authority shall, after due and diligent search, accompany its request to the County Auditor for the certification of or its notice of enlargement of the TIF District with a listing of all properties within the TIF District for which building permits have been issued during the eighteen (18) months immediately preceding approval of the TIF Plan by the EDA Authority. 2-1 The County Auditor shall increase the original tax capacity of the TIF District by the tax capacity of each improvement for which a building permit was issued. If said listing does not accompany the aforementioned request or notice, the absence of such listing shall indicate to the County Auditor that no building permits were issued in the eighteen (18) months prior to the EDA Authority's approval of the TIF Plan. Section 2.8 Fiscal Disparities. The Council hereby elects the method of tax increment computation set forth in Minnesota Statutes, Section 469.177, Subdivision 3, clause (b) as required by Minnesota Statutes for economic development districts. Section 2.9 Estimated Proiect Costs. The estimated costs associated with this portion of Redevelopment Project No. 1 (the "Project Area") are listed on Exhibit I-A. Section 2.10 Estimated Amount of Indebtedness. It is anticipated that approximately $850,000 of indebtedness will be incurred with respect to this portion of the Project Area. Section 2.11 Sources of Revenue. The costs outlined on Exhibit I-A may be financed from City or EDA Authority contributions, internal funding, bond proceeds from general obligation or revenue debt, tax increments as they are generated and become available, or other financing mechanisms authorized by law. The EDA Authority reserves the right to use other revenue sources legally applicable to the Project Area including, but not limited to, special assessments, utility revenues, federal/state funds, and investment income. Sources of revenue are listed on Exhibit I-A. Section 2.12 Estimated Original and Captured Tax Capaci .ty. The tax capacity of all taxable property in the TIF District, as most recently certified by the Commissioner of Revenue of the State of Minnesota on January 2, 2001, is estimated to be $4,891. The estimated captured tax capacity of the TIF District upon completion of the proposed improvements on January 2, 2004, is estimated to be $90,806. The ED Authority intends to utilize 100% of the captured tax capacity, for the duration of the TIF District, for purposes of determining tax increment revenues. Section 2.13 Tax Rate. The pay 2002 tax capacity rate is 1.41880. Section 2.14 Tax Increment. Annual initial tax increment has been calculated at approximately $128,835 assuming a static tax capacity rate and a valuation increase of zero percent (0.0%) compounded annually. A financial analysis is provided on Exhibit II-C. Section 2.15 Ty~e of TIF District. The TIF District is, pursuant to Minnesota Statutes, Section 469.174, Subdivision 12, an economic development district. Section 2.16 Duration of TIF District. The duration of the TIF District is expected to 2-2 eight (8) years from receipt of the first tax increment. The date of receipt of the first tax increment is estimated to be July, 2004. Thus, it is estimated that the TIT District, including any modifications for subsequent phases or other changes, would terminate in the year 2012. Section 2.17 Estimated Impact on Taxing Jurisdictions. The estimated impact on other taxing jurisdictions assumes construction would have occurred without the creation of the TIT District. If the construction is a result of tax increment financing, the impact is $0 to other entities. Notwithstanding the fact that the fiscal impact on the other taxing jurisdictions is $0, due to the fact that the financing would not have occurred without the assistance of the EDA Authority, Exhibit II-E reflects the estimated impact of the TIT District if the "but for" test were not met. Section 2.18 Modification of the TIF District and/or TIT Plan. As of September 9, 2002, no modifications to the TIT District or the TIT Plan have been made. G:\~PDATA\N\NE~ HOPE\08\?IF\TIF PLAN.DOC 2-3 EXHIBIT II - A PARCELS TO BE INCLUDED IN TAX INCREMENT FINANCING DISTRICT NO. 02-1 PIN 08-118-21-24-0005 PIN 08-118-21-23-0006 PIN 08-118-21-23-0008 PIN 07-118-21-23-0022 G:\WPDATA~I~IEW HOPEV}$\TII~TI~ Pl..AN II-A- 1 EXHIBIT II-B 2 SUBJECT AREAS COMPRISE TAX INCREMENT FINANCING DISTRICT NO. 02-1 II-B-1 EXHIBIT II-C ASSUMPTIONS Original Market Values Navarre I Navarre Parking lot 08-118-21-24-0005 2 Ahrens Trucking 08-118-21-23-0006 30utlot 08-118-21-23-0008 Ahrens 1 9200 49th Ave N. 07-118-21-23-0022 Totals Original Tax Capacity <= 150,000 1.50% > 150,000 2.00% Estimated Market Value Navarre warehouse 130,000 Ahrens Building 10,000 Estimated Tax Capacity Navarre warehouse Ahrens Building <= 150,000 1.50% · 150,000 2.00% 7550 49th Ave. 7600 49th Ave. % of Site 66.7% sq. ft. ~} $ 50.00 per sq. ft. = sq. ff. O $ 60.00 per sq. fL = Estimated Taxes Navarre warehouse 130,000 sq. ft. @ $ 2.16 Ahrens Building 10,000 sq. ft. ~ $ 2.25 Estimated Tax Increment - Annual Area of Parcel 112/2001 Market Value (Pay 2002) (Acres) (Sq. Feet) Land Building Total 0.98 42.675 108,000 - 108,000 1.00 43,570 109,000 42,000 151,000 3.73 162,280 186,000 186,000 1.90 82,724 82,724 82,724 7.60 331,249 $ 485,724 $ 42.000 $ 527,724 1.47 persq, ff. of Land 4,891 6,500,000 600,000 129,250 11,250 7,100,000 140,500 per sq. ft. = per sq. ft. = 258,258 22,479 128,288 280,737 45.7% of total taxes paid Local Tax Rate - Pay 2002 1.41880 State Tax Rate - Pay 2002 estimate 0.57933 Combined Tax Rate - C/I Property Only 1.99813 * used for tax increment calculations Admin Fees 10.00% State Auditor Fee 0.425% Inflation (after 2 yrs of full value) 0.00% PV Rate - Rev. Note 12/112002 7.00% PV Rate. City 12/1/2002 5.00% Fiscal Disparities Rate 33.0385% (C/I only) Navarre - Ahrens TI Combined 4.xls II-C-1 EXHIBIT II-C CONTINUED CASH FLOW AND PRESENT VALUE ANALYSIS 1 2 3 4 5 6 7 8 9 < ANNUAL (a) (b) (c) Original Estimated Tax Tax Date Capacity Capacity (see assumptions) 0.0% Inflation 06/01/02 4,891 4,891 12/01/02 4,891 4,891 06/01/03 4,891 4,891 12/01/03 4,891 4,891 06/01/04 4,891 140,500 12/01/04 4,891 140,500 06/01105 4;891 140,500 12/01/05 4,891 140,500 06/01/06 4,891 140,500 12/01/06 4,891 140,500 06/01/07 4,891 140,500 12/01/07 4,891 140,500 06/01108 4,891 140,500 12/01/08 4,891 140,500 06/01/09 4,891 140,500 12/01/09 4,891 140,500 06/01/10 4,891 140,500 12/01/10 4,891 140,500 06/01/11 4,891 140,500 12/01/11 4,891 140,500 06/01/12 4,891 140,500 12/01/12 4,891 140,500 (d) (e) (f') (g) (h) Captured Adjusted Est. T.I. Less: Tax Fiscal Captured (t') x Admin Capacity Disparities Tax Cap. 1.4188 Fees (c) - (b) (d) x (d) - (e) St. Aud. Fee (g) x (prev. year) 33.0385% 0.425% 10.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 ' (44,803) 90,806 64,144 135,609 (44,803) 90,806' 64,144 . 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806. 64,144 135,609 (44,803) 90,806 64,144 135,609 (44,803) 90,806 64,144 SEMI - ANNUAL (i) (j) Available Cumulative Tax Avail. Tax Increment Increment (g) - (h) Total of (i) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6,414 57,730 57,730 6,414 57,730 115,459 6,414 57,730 173,189 6,414 57,730 230,918 6,414 57,730 288,648 6,414 57,730 346,377 6,414 57,730 404,107 6,414 57,730 461,836 6,414 57,730 519,566 6,414 57,730 577,295 6,414 57,730 635,025 6,414 57,730 692,755 6,414 57,730 750,484 6,414 57,730 808,214 6,414 57,730 865,943 6,414 57,730 923,673 1,026,303 102,630 923,673 923,673 Navarre - Ahrens TI Combined 4.xls II-C-2 EXHIBIT II - D "BUT FOR" ANALYSIS OF TAX INCREMENT FINANCING DISTRICT NO. 02-1 Navarre Corporation proposes to construct a warehouse of up to 130,000 square feet adjacent to its existing facility (the "Adjacent Site"). It also proposes to construct a warehouse/trucking facility of up to 10,000 square feet on a site referred to as the relocation site (the "Relocation Site"), a site which the City has targeted for redevelopment for a number of years. Both the Adjacent Site and the Relocation Site, while not contiguous, are in the TIF District. The Adjacent Site currently contains a business which must be relocated and the existing structure demolished. The Adjacent Site also has sewer and water lines which must be relocated. The Relocation Site has extremely poor soils which must be corrected before any building can be constructed. In addition, a storm water pond must be placed on the Relocation Site to accommodate both the site and the adjacent areas. Without tax increment assistance for both the soil correction on the Relocation Site, and the utility relocation, business relocation and structure demolition on the Adjacent Site, this development would not proceed. In addition to creating between 40 and 50 additional employment opportunities, this development will provide an additional $6.5 million to the City's tax base. Finally, without tax increment assistance, the developer would have had to develop its business outside of the City. G:\~PDATA\N\NE~ HOPE\08\TIF\TIF PI~M~I II-D- 1 EXHIBIT II - E ESTIMATED IMPACT OF TAX INCREMENT FINANCING DISTRICT NO. 02-1 IMPACT ON TAXBASE ENTITY ORIGINAL ESTIMATED CAPTURED DISTRICT TAX TAX TAX TAX AS % BASE CAPACITY CAPACITY CAPACITY * OF TOTAL City of New Hope 14,316,989 4,891 County of Hennepin 1,048,786,334 4,891 lSD # 281 69,248,429 4,891 140,500 90,806 0.634% 140,500 90,806 0.009% 140,500 90,806 0.131% * Reflects adjustment for fiscal disparities contribution. IMPACT ON TAX RATE TAX TAX RATE INCREMENT INCREASE TAX % OF ENTITY RATE TOTAL City of New Hope 0.53872 37.97% 48,919 0.344% County of Hennepin 0.50409 - 35.53% 45,774 0.004% lSD # 281 0.30213 21.29% 27,435 0.040% Other 0.07386 5.21% - 6~707 1.41880 100.00% 128,835 Assumes:constrUction would have occurred without the creation of a TaX Increment Financing District. If construction is a result of Tax Increment Financing, the impact is $0. II -E -1 KRAS$ MONROE, P.A. ATTORNEYS AT LAW Mary. E. MolzMm. Sr. Development AriMa! J,,mes R. C~sserly. E. sq. Emml ¥ou-'e blni! (952~ 883-I29~ MEMORANDUM Date: Re: From: Mary E. Molzahn, Sr. Development Analyst James R. Casserly, Esq. Ju~y 15, 2002 Bass Lake Road Corridor Our File No. 10048-7 As you requested, we have reviewed the City's tax increment financing program. The ~)~S~c~S~l'lRFe~i=~-me~ wNemPm~__cts~_~(?~_je_ct .Areas..') and six Tax Increment Financing Redevelopment Plans ~nd ~-,,- ~---*~-~--a-s,-c°'~ermln-us areas governed by combined . , ~., ,-~=rrmn[ financing Plans IF PI ' these s~x individual Project Areas we-- -----'-; ...... ~_ aris ). Subsequently Modification adopted in 1994 an-~ ~..~_..,~_.~.~__r~_r~ ~._a__smgle Project Area by a Master ~JS ~*'""~"*- "--"" .... u ,u~u~r mcx~nleo In 19!~5, 1997, 1998 an-* "'~'~'~ Distri,,~,~ __, ........... *,..~. ~.~y = au[ i ax Increment.Financin DJ ' .. *""'"~ I m= ,~:mea. Allno n ' . __ g stricts ( "rlF .. ug ~n~s Master Modifi · . me IndMdual Prolact Areas ~,~ ~.,'--,-.,..-, ,-,- ~ .cation combined lhe physical areas of . -- , ,,~ ,,u,v,~um m~aevelopment Plans were never separated .~m~we discussed last week, we will pmr~. ,.,,.,~_., ,., _. . uae the combirmd ~ ..,'_.-T~_7 ' ,~.,=u neoevmopment Plan whi~ ,~,1------_~._~. . ~'~IW ll~l ~[~'~]~l~ ~'~.,l~l~, --.,,aa__ o.. . ~ons arm . E-~:---..,.._~.~,~, .auu-mrlaes, ~udgets and ~-y win1 one . --- ---,.,--~ul~mm i--lan and Wi! ' ,".~vmoprnent Project No. 1. '"'~ '"~"~' _ ,~:mu~E~. F~~ mNN~OTA ~m.1447 We will also prepare the Tax Increment Financing Plan ("i'IF Plan") for proposed Tax Increment Financing District No. 02-1. The format of this new TIF Plan will differ from the City's previous format which combined the TIF Plans with the Redevelopment Plans. The proposed TIF Plan will only address the proposed activities of the individual TIF District. We look forward to working with you. EDA REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section Community Development x,,~,~,~ 9-09-02 EDA Item No. By: Kirk McDonald By: 5 A RESOLUTION AUTHORIZING ExEcUTION AND DELIVERY OF A CONTRACT FOR PRIVATE REDEVELOPMENT, BY AND BETWEEN THE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY AND NAVARRE CORPORATION REQUESTED ACTION Staff recommends that the EDA approve the enclosed resolution. POLICY/PAST PRACTICE The EDA has approved contracts for private redevelopment in the past. BACKGROUND The resolution states that: · It has been proposed that the EDA enter into a Contract for Private Redevelopment (the "Contract") with Navarre Corporation or its permitted successors or assigns (the "Redeveloper"). The resolution includes the following findings: · The EDA hereby finds that the Contract promotes the objectives as outlined in its Restated Redevelopment Plan for Redevelopment Project No. 1 established pursuant to Minnesota Statutes. · The EDA hereby finds that it has approved and adopted Tax Increment Financing District No. 02-1 and the EDA has approved and adopted the Tax Increment Financing Plan relating thereto pursuant to Minnesota Statutes. The resolution grants the following: · The President and the Executive Director (the "Officers") are hereby authorized to execute and deliver the Contract when the following condition is met: Substantial conformance to the Contract presented to the EDA as of this date with such additions and modifications as those Officers may deem desirable or necessary as evidenced by the execution thereof. MOTION BY f~/~~ SECOND BY Request for Action Page 2 Representatives from Krass Monroe will be present to review the Contract with the EDA. Staff recommends approval of the resolution. ATTACHMENTS · Resolution · Redevelopment Contract 9-09-02 NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY COUNTY OF HENNEPIN STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A CONTRACT FOR PRIVATE REDEVELOPMENT, BY AND BETWEEN THE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY AND NAVARRE CORPORATION. BE IT RESOLVED by the New Hope Economic Development Authority (the "EDA") as follows: Section 1. Recitals. 1.01 It has been proposed that the EDA enter into a Contract for Private Redevelopment (the "Contract") with Navarre Corporation or its permitted successors or assigns (the "Redeveloper"). Section 2. Findin.qs. 2.01 The EDA hereby finds that the Contract promotes the objectives as outlined in its Restated Redevelopment Plan for Redevelopment Project No. 1 established pursuant to Minnesota Statutes, Sections 469.001 et seq. 2.02 The EDA hereby finds that it has approved and adopted Tax Increment Financing District No. 02-1 and the EDA has approved and adopted the Tax Increment Financing Plan relating thereto pursuant to Minnesota Statutes, Sections 469.174 through 469.1799, inclusive, as amended and supplemented from time to time. Section 3. Authorizations. 3.01 The President and the Executive Director (the "Officers") are hereby authorized to execute and deliver the Contract when the following condition is met: Substantial conformance to the Contract presented to the EDA as of this date with such additions and modifications as those Officers may deem desirable or necessary as evidenced by the execution thereof. Adopted by the EDA this day of ,2002. ATTEST: , President , Executive Director G:~WPDATA~N~NEW HOPEI08~D~A RESOLUTION AUTHORIZING EXECUTION OF DEV AGR.DOC CONTRACT FOR PRIVATE REDEVELOPMENT THIS AGREEMENT ("Agreement") is made on or as of the ~ day of , 2002 by and between the NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY, a public body corporate and politic (the "Authority"), having its principal offices at 4401 Xylon Avenue North, New Hope, Minnesota 55428, and NAVARRE CORPORATION, a Minnesota corporation (the "Redeveloper"), having its principal office at 7460 - 49th Avenue North, New Hope, MN 55428. WITNESSETH: WHEREAS, the Authority is a political subdivision of the State of Minnesota and is governed by a board of commissioners; WHEREAS, in furtherance of the Authority's objectives, there has been established a Restated Redevelopment Plan (the "Project Plan") for Redevelopment Project No. 1 (the "Project Area") in the City of New Hope, Minnesota (the "City") to encourage and provide maximum opportunity for private development and redevelopment of certain property in the City which is not now in its highest and best use; WHEREAS, as of the date of this Agreement the Project Plan has been prepared and approved, and the Project Area has been established pursuant to Minnesota Statutes, Sections 469.001 through 469.047 and 469.090 through 469.108; WHEREAS, in connection with the Project Area the City Council of the City has created a Tax Increment Financing District No. 02-1 (the "Tax Increment District") pursuant to the Minnesota Tax Increment Financing Act in Minnesota Statutes, Sections 469.174 to 469.179; WHEREAS, the Redeveloper currently owns a parcel of land located adjacent to the eastern portion of the Tax Increment District and wishes to acquire land in that portion of the Tax Increment District in order to construct a building expansion; WHEREAS, Ahrens Trucking, the business currently located in the eastern portion of the Tax Increment District ("Ahrens") is willing to relocate its operations to the western portion of the Tax Increment District if the Redeveloper will construct a new facility for that business; WHEREAS, the Redeveloper is willing to perform such construction for Ahrens; City; WHEREAS, the land onto which Ahrens is willing to relocate is currently owned by the WHEREAS, the City is willing to sell a sufficient amount of land to the Authority for transfer to the Redeveloper in order to facilitate Ahrens' relocation, and the City wishes to retain some land to the north of this relocation area in order to construct a regional storm water pond; WItEREAS, the major objectives in establishing the Project Area are to: encourage the removal of blighted commercial sites and the construction of modem commercial facilities in their place; promote and secure the prompt development of certain property in the Project Area in a manner consistent with the City's Comprehensive Plan and with minimum adverse impact on the environment, which property is currently less productive because of the lack of proper utilization and lack of investment, thus promoting and securing the development of other land in the City; promote and secure additional employment opportunities within the Project Area and the City for residents of the City and the surrounding area, thereby improving living standards and preventing unemployment and the loss of skilled labor and other human resources in the City; secure the increase of property subject to taxation by the City, the County, the school district and other taxing jurisdictions in order to better enable such entities to pay for public improvements and governmental services and programs required to be provided by them; promote the concentration of appropriate commercial development within the Project Area in order to maintain the area in a manner compatible with its accessibility and prominence in the City; provide for the financing and construction for public improvements in and adjacent to the Project Area necessary for the orderly and beneficial redevelopment of the Project Area and adjacent areas of the City; encourage local business expansion, improvement, and redevelopment, whenever possible; 10. create a desirable and unique character within the Project Area through quality land use alternatives and design quality in new or remodeled buildings; encourage and provide maximum opportunity for private redevelopment of existing areas and structures which are compatible with the Project Area; and encourage safe and affordable housing options. W}tEREAS, in order to achieve the objectives of the Authority and City in creating the Project Area and in adopting the Project Plan, the Authority is prepared to provide assistance in accordance with this Agreement; and WHEREAS, the Authority believes that the development and redevelopment of the Project Area pursuant to this Agreement, and fulfillment generally of the terms of this Agreement, are in the vital and best interests of the Authority and the health, safety, morals and welfare of its residents, and in accord with the public purposes and provisions of applicable federal, state and local laws under which the development and redevelopment are being undertaken and assisted; NOW, TItEREFORE, in consideration of the premises and the mutual obligation of the parties hereto, each of them does hereby covenant and agree with the other as follows: ARTICLE I Definitions Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Acquisition Costs" means the Redeveloper's costs of acquiring the Redevelopment Property, which costs are described in Schedule G attached to and made a part of this Agreement. "Act" means Minnesota Statutes, Section 469.001 et seq. "Administrative Costs" means administrative costs of the Authority in an amount not to exceed 10% of the Tax Increment. "Agreement" means this Agreement, as the same may be from time to time modified, amended, or supplemented. "Ahrens Relocation Site" means the southerly two-thirds, more or less, of the land commonly known as 9200 - 49th Avenue North, which land is to be acquired by the Authority from the City and subsequently conveyed to the Redeveloper pursuant to the terms of Article III of this Agreement and which land is described on an exhibit to Schedule A attached to and made a part of this Agreement. The Ahrens Relocation Site will consist of approximately 2.0 acres. The precise size will be the area reasonably necessary for the Redeveloper's construction of the New Ahrens Building and related improvements. "Ahrens Relocation Site Deed" means the Deed, substantially in the form of Schedule D attached hereto and made a part of this Agreement, to be used to convey the Ahrens Relocation Site from the Authority to the Redeveloper. "Authority" means the New Hope Economic Development Authority, or any of its successors or assigns. "Available Tax Increment" means the Tax Increment, less the Administrative Costs. "Business Subsidy Agreement" means a wage and job goal agreement between the Authority and the Redeveloper, substantially in the form contained in Schedule I attached to and made a part of this Agreement "City" means the City of New Hope, Minnesota, or its successors or assigns. "City Property" means the approximately 3.0 acres comprising the Ahrens Relocation Site and the Regional Storm Water Pond Site. "Construction Plans" means the plans, specifications, drawings and related documents on the construction work to be performed by the Redeveloper on both portions of the Redevelopment Property which (a) shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the building inspector or the City, and Co) shall include at least the following for each building: (1) site plan; (2) foundation plan; (3) basement plans; (4) floor plan for each floor; (5) cross sections of each (length and width); (6) elevations (all sides, except as to a side of an existing structure where no construction is to take place); (7) facade and landscape plan; and (8) such other plans of supplements to the foregoing plans as the Authority may reasonably request. "Council" means the Council of the City. "County" means the County of Hennepin, Minnesota. "Current Ahrens Site" means land of approximately 1.0 acre to be acquired by the Redeveloper on or about ,2002, and which is situated adjacent to the Navarre Property, as described on an exhibit to Schedule A attached to and made a part of this Agreement. "Expansion Site" means the Navarre Property and the Current Ahrens Site. "Holder" means the owner of a Mortgage. "Minimum Improvements" means the construction of the New Ahrens Building, the Utilities Relocation, and the Navarre Expansion. "Minnesota Environmental Policy Act" means the statutes located at Minnesota Statutes, Sections 116D.01 et seq., as may be amended from time to time. "Minnesota Environmental Rights Act" means the statutes located at Minnesota Statutes, Sections 116B.01 et seq., as may be amended from time to time. "Mortgage" means any mortgage or other agreement in which the Redeveloper has granted or acquiesced in a security interest in the Redevelopment Property, or any portion thereof or any improvements constructed thereon, and which is a permitted encumbrance pursuant to the provisions of Article VIII of this Agreement. "National Environmental Policy Act" means the federal law located at 42 U.S.C. Sub. Sect. 4331 et seq., as may be amended from time to time. "Navarre Expansion" means construction of a warehouse of approximately 100,000 square feet on the Expansion Site. The building will have a total project cost, excluding land value, of approximately $ . The exterior materials for the building will include "Navarre Expansion Certificate of Completion" means the certification, in a form substantially similar to that contained in Schedule F attached to and made a part of this Agreement, to be provided by the Authority to the Redeveloper pursuant to Section 4.~ of this Agreement. "Navarre Property" means the approximately 4.7 acres of land currently owned by the Redeveloper and which is situated adjacent to the Current Ahrens Site, as described on Schedule C attached to and made a part of this Agreement. "New Ahrens Building" means construction of an approximately 4,800 square foot building on the Ahrens Relocation Site. The building will have a total project cost, excluding land value, of approximately $ The exterior materials for the building will include "New Ahrens Building Certificate of Completion and Release of Forfeiture" means a certification and release of forfeiture, in a form substantially similar to that contained in Schedule E attached to and made a part of this Agreement, to be provided by the Authority to the Redeveloper pursuant to Section 4.3 of this Agreement. "Note" means a limited revenue note to be issued by the Authority to the Redeveloper in substantially the form contained in Schedule H attached to and made a part of this Agreement. "Parties" means the Redeveloper and the Authority. "Party" means either the Redeveloper or the Authority, as the context may require. "Plan" means, collectively (i) the Restated Redevelopment Plan for adopted by the Authority and approved by the City for Redevelopment Project No. 1, and (ii) the Tax Increment Plan. "Project Area" means Redevelopment Project No. 1, as amended, established in accordance with the Act. "Public Improvements" means the relocation of the public utilities or other public improvements within the Redevelopment Property as described on Schedule G. attached to and made a part of this Agreement, which improvements are to be funded by the Redeveloper and are eligible for reimbursement via the Note as outlined in Article III of this Agreement. "Redeveloper" means Navarre Corporation, a Minnesota corporation, and its permitted successors and assigns. "Redeveloper Security" means a promissory note of One Hundred Thousand Twenty-Five and No/100 Dollars ($125,000.00), in substantially the form of Schedule K attached hereto and made a part of this Agreement, and secured by a mortgage pursuant to Article X of this Agreement. This security shall be provided in order to guarantee the construction of the Navarre Expansion and will be released by the Authority the Redeveloper meets the applicable requirements outlined in Article X of this Agreement. "Redevelopment Project" means the Redevelopment Property, the Public Improvements, the Site Improvements and the Minimum Improvements. "Redevelopment Property" means the Expansion Site and the Ahrens Relocation Site. "Regional Storm Water Pond" means a regional pond to be constructed by the City on the Regional Storm Water Pond Site. "Regional Storm Water Pond Site" means the northerly one-third, more or less, of the land commonly known as 9200 - 49th Avenue North, which land described on Schedule B, attached to and made a part of this Agreement, and is owned by the City and which land will remain in the City's possession to be utilized for the construction of the Regional Storm Water Pond. The Regional Storm Water Pond Site will consist of approximately 1.0 acre. "Site Improvements" means the site preparation work for the Redevelopment Property which is described in Schedule G, attached to and made a part of this Agreement, which improvements are to be funded by the Redeveloper and are eligible for reimbursement via the Note as outlined in Article III of this Agreement. "State" means the State of Minnesota. "Tax Increment" means the real estate taxes paid with respect to the Redevelopment Property that is remitted to the Authority as tax increment pursuant to the Tax Increment Act. "Tax Increment Act" means the Tax Increment Financing Act, Minnesota Statute.q, Sections 469.174 to 469.179, as may be amended from time to time. "Tax Increment District" means Tax Increment Financing District No. 02-1, which includes the Expansion Site and the City Property and which was established by the Authority and approved by the Council pursuant to the Tax Increment Act. "Tax Increment Plan" means the tax increment financing plan adopted by the Authority. and approved by the City in connection with the creation of the Tax Increment District. "Tax Official" means any City or County assessor; County auditor; City, County or State board of equalization, the commissioner of revenue of the State, any State or federal district court, and the tax or any other court of the State, including the State Court of Appeals and the State Supreme Court. "Termination Date" means ,20__ or such other date if this Agreement is terminated in accordance with the provisions of Article V of this Agreement. "Unavoidable Delays" means delays which are the result of strikes or of casualties to the Minimum Improvements, the Redevelopment Property or the equipment used to construct the Minimum Improvements, and also means delays related to financing, delays which are the result of governmental actions or governmental changes in plans, delays which are the result of judicial action commenced by third parties, delays directly related to citizen opposition or other action affecting this Agreement, delays which are the result of adverse weather conditions or acts of God, and delays caused by acts of war or terrorism which directly impact the Project. "Use Certificate" means a certificate signed by an owner or operator of a portion of the completed Minimum Improvements, which certificate will be in substantially the form contained in Schedule J attached to and made a part of this Agreement. ARTICLE H Representations and Warranties Section 2.1. Representations by the Authority. The Authority makes the following representations as the basis for the undertaking on its part pursuant to this Agreement: (a) The Authority is a public body corporate and politic duly organized and existing under the laws of the State. Under the provisions of the Act, the Authority has the power to enter into this Agreement and to carry out the Authority's obligations contained herein. (b) The Authority has approved the Restated Redevelopment Plan for Redevelopment for Redevelopment Project No. 1 in accordance with the terms of the Act. (c) The Authority has adopted and approved the Tax Increment District pursuant to the Tax Increment Act and the City, based on these activities of the Authority, has established the Tax Increment District pursuant to the Act. (d) The Authority, subject to Unavoidable Delays, intends to convey to the Redeveloper title to the Ahrens Relocation Site pursuant to Article III of this Agreement; provided that the Redeveloper utilizes that site in accordance with the Plan and this Agreement. (e) To finance the costs of the redevelopment activities to be undertaken by the Redeveloper, the Authority proposes to issue the Note to the Redeveloper; provided that the conditions for Note issuance outlined in this Agreement are satisfied by the Redeveloper. (f) The Authority will cooperate with the Redeveloper with respect to any litigation commenced by third parties in connection with this Agreement. (g) The Authority makes no representation, guarantee, or warranty, either express or implied, and hereby assumes no responsibility or liability as to the Ahrens Relocation Site or the Expansion Site or their respective conditions (whether regarding soils, pollutants, hazardous wastes or otherwise) and the Authority further makes no representation, guarantee, or warranty, either express or implied, that the Ahrens Relocation Site and/or the Expansion Site shall be suitable for the Redeveloper's or any third party's purposes or needs (including but not limited to the purposes or needs of a lrucking facility). (h) In addition to issuing the Note, the Authority will assist with the Redevelopment Project by paying all reasonable costs for the Ahrens Relocation Site that relate to platting and surveying; provided that the Redeveloper coordinates these activities and provides the Authority with regular reports on the stares of these activities. Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper represents and warrants that: (a) Subject to Unavoidable Delays, the Redeveloper will construct all components of the Minimum Improvements in accordance with the terms of this Agreement, the Plan and all local, State and federal laws, ordinances, roles, regulations or other similar provisions (including but not limited to those relating to environmental, zoning, building code and public health matters). The Redeveloper will thereafter: maintain the Ahrens Relocation Site, until the Temdnation Date or the date the site is transferred to a third party in accordance with this Agreement, whichever is earlier, with all maintenance activities to be performed or caused by the Redeveloper in accordance with the terms of this Agreement, the Plan and all local, State and federal laws, ordinances, roles, regulations or other similar provisions (including but not limited to those relating to environmental, zoning, building code and public health matters); and (2) maintain the Expansion Site, until the Termination Date, in accordance with the terms of this Agreement, the Plan and all local, State and federal laws, ordinances, rules, regulations or other similar provisions (including but not limited to those relating to environmental, zoning, building code and public health matters). (b) All components of the Minimum Improvements will be an allowed use under the zoning ordinance(s) of the City. (c) As of the date of the Redeveloper's execution of this Agreement, the Redeveloper has received no notice or communication from any local, state or federal official that the activities of the Redeveloper or the Authority in the Project Area may be or will be in violation of any environmental law or regulation. (d) As of the date of the Redeveloper's execution of this Agreement, the Redeveloper is aware of no facts the existence of which would cause the Redeveloper to be in violation of any local, State or federal environmental law, ordinance, rule, regulation, review procedure or other similar provision which could give any person or entity a valid claim under the Minnesota Environmental Rights Act. 10 (e) The Redeveloper will, within thirty (30) days after the date of this Agreement, use its best efforts to obtain, in a timely manner, all required permits, licenses, approvals and similar provisions necessary to begin construction of the New Ahrens Building and will thereafter meet, in a timely manner, all requirements of all applicable local, State and federal permits, licenses. approvals, and similar provisions which must be obtained or met before all components of the Minimum Improvements may be lawfully constructed. (0 Minnesota. The Redeveloper is a corporation organized under the laws of the State of (g) The Redeveloper agrees that it will cooperate with the Authority and shall indemnify the Authority against all costs, including the costs of defense incurred by the Authority, through an attorney reasonably acceptable to the Authority and Redeveloper, with respect to any litigation commenced by third parties in connection with Redeveloper's failure to perform according to the terms and conditions of this Agreement. (h) The financing arrangements that the Redeveloper has obtained, or will obtain, to finance acquisition of the Ahrens Relocation Site and the construction of all components of the Minimum Improvements will, together with financing to be provided by the Authority pursuant to this Agreement, be sufficient to enable the Redeveloper to successfully complete the Minimum Improvements as contemplated in this Agreement. (i) The Redeveloper has the exclusive right to purchase the Current Ahrens Site and plans to take title to that land on or about ,20 (j) The conslxuction of the Minimum Improvements, in the opinion of the Redeveloper, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future without the use of the tax increment financing contemplated by this Agreement. (k) Once acquired by the Redeveloper and until the issuance of the New Ahrens Building Certificate of Completion and Release of Forfeiture, the Ahrens Relocation Site shall not become exempt from the levy of ad valorem property taxes, or any statutorily authorized alternative, and any improvements of any kind constructed on the Ahrens Site shall similarly not become exempt; notwithstanding the forgoing language, such tax exemption status is allowed after the dissolution or other termination of the Tax Increment District. (1) Once acquired by the Redeveloper, the Expansion Site shall not become exempt from the levy of ad valorem property taxes, or any statutorily authorized alternative, until after the dissolution or other termination of the Tax Increment District or December 31, 20 (whichever is later), and further no improvements of any kind constructed on the Expansion Site 11 shall similarly become tax exempt until after the dissolution or other termination of the Tax Increment District or December 31, 20 (whichever is later). (m) The Redeveloper agrees, notwithstanding the provisions of Article VI of this Agreement, that it will not assign, convey or lease any interest in the Ahrens Relocation Site or any portion thereof, the Expansion Site or any portion thereof, or this Agreement to any tax- exempt entity under the U.S. Internal Revenue Code of 1986, as may be amended from time to time, without the prior written approval of the Authority (whose approval shall be conditioned upon the Redeveloper executing a payment in lieu of tax pursuant to agreement terms reasonably satisfactory to the Authority). (n) The Authority has provided to the Redeveloper, and the Redeveloper acknowledges receipt of, a copy of Minnesota Statutes, Sections 116J.993 to 116J.995 (the "Business Subsidies Act"). The Redeveloper covenants to comply with all applicable reporting requirements and other provisions of the Business Subsidies Act, as the same may be amended from time to time. The Redeveloper hereby further acknowledges: (1) That failure on the part of the Redeveloper to comply with the reporting requirements of the Business Subsidies Act is an Event of Default and, in addition, may result in the imposition by the Authority of a penalty. (2) That the Business Subsidies Act may require reporting by the Redeveloper even if the Parties determine that all or a portion of the Redevelopment Project is exempt from that act. (3) That the Business Subsidies Act cun'ently allows for a penalty of up to $1,000.00 for a recipient's failure to meet reporting requirements. (o) At the time the Certificate of Completion, Redeveloper agrees to use or cause the Redevelopment Properly to be used so that it may qualify as an "economic development district" as defined under the Tax Increment Act. 12 ARTICLE m Undertakings of the Authority and Redeveloper Section 3.1. Revenue Note to the Redeveloper for the Site Improvements and the Acquisition Costs. As consideration for the execution of this Agreement and the construction of the Minimum Improvements by the Redeveloper the Authority agrees, subject to the applicable provisions of this Agreement (including but not limited to those outlined in this Article III), to deliver the Note to the Redeveloper in order' to assist the Redeveloper with the Site Improvements and the Acquisition Costs. Section 3.2. Limitations on the Revenue Note Undertakings of the Authority. (a) The Authority shall have no obligation to the Redeveloper under this Agreement to deliver the Note if the Authority, at the time the Note is to be delivered, is entitled under Section 5.2 of this Agreement to exercise any of the remedies set forth therein as a result of an Event of Default by the Redeveloper which has not been cured. If the Authority has not exercised its remedies under Section 5.2(b) of this Agreement but the Note is withheld due to an Event of Default by the Redeveloper that is later cured, the Note shall be delivered after such cure. (b) The Authority shall have no obligation to deliver the Note to the Redeveloper unless the Redeveloper has submitted to the Authority reasonably sufficient documentation evidencing the following: (i) An itemized listing of the Acquisition Costs; (ii) A sworn construction statement by the Redeveloper for the Site Improvements, along with a certification signed by the Redeveloper's project architect and/or another appropriate party and stating to the effect that the costs for which payment was made were incurred in connection with this portion of the Redevelopment Project; (iii) A separate sworn construction statement by the Redeveloper for the Public Improvements, along with a certification signed by the Redeveloper's project architect and/or another appropriate party and stating to the effect that the costs for which payment was made were incurred in connection with this portion of the Redevelopment Project; 13 (iv) Copies of lien waivers from the contractors, subcontractors, construction managers and/or any other professionals retained for the Site Improvements, the Public Improvements or acquisition of the Redevelopment Property. (v) A statement from the City, in form and content reasonably acceptable to the Authority, that all utility relocation and installation activities performed or caused by the Redeveloper were conducted in accordance with the City's standard utility construction requirements. The Authority shall indicate its acceptance of the amounts for the Revenue Note, assuming the conditions of this Section 3.2 have been complied with and there is no Event of Default, when the Authority issues the Navarre Expansion Certificate of Completion in accordance with Section 4.4 of this Agreement. Section 3.3. Conditions Precedent to Delivery of Revenue Note.. The Authority's obligation to reimburse the Redeveloper for the costs of the Site Improvements, the Acquisition Costs and the Public Improvements in accordance with Section 3.2 by delivery of the Note shall, in addition to the documentation requirements outlined in that Section, be contingent upon the satisfaction by the Redeveloper of all of the following conditions precedent: (a) The Redeveloper shall be in material compliance with all of the terms and provisions of this Agreement; (b) The Redeveloper shall be in compliance with all ordinances of the City. (c) The Redeveloper shall have delivered executed Use Certificates for the Navarre Expansion and the New Ahrens Building. (d) The Authority shall have issued the New Ahrens Building Certificate of Completion and Release of Forfeiture, as well as the Navarre Expansion Certificate of Completion. (e) The Redeveloper shall have delivered Use Certificates for all portions of the Ahrens Relocation Site and the Expansion Site. Section 3.4 Conveyance of the Ahrens Relocation Site. (a) Title. Within a reasonable time after the date of this Agreement, the Authority shall obtain and furnish to the Redeveloper a commitment for the issuance of an owner's policy for title insurance for the Ahrens Relocation Site, naming the Redeveloper as the proposed insured party. The Redeveloper shall have ten (10) days from the date of its receipt of such 14 commitment to review the state of title to the Ahrens Relocation Site and to provide the Authority with a written list of objections, if any, to such title. Upon receipt oft list of written objections from the Redeveloper, the Authority shall proceed in good faith and with all due diligence to attempt to cause the objections made by the Redeveloper to be cured. A title objection shall be deemed cured if the title insurer agrees to issue an endorsement to the owner's insurance policy affirmatively insuring over such objection. Within ten (10) days after the date that all such objections have been cured to the reasonable satisfaction of the Redeveloper, the Authority and the Redeveloper shall proceed with the conveyance of the Ahrens Relocation Site under this Article III. The Authority shall convey marketable title to, and possession of, the Ahrens Relocation Site to the Redeveloper by the Ahrens Relocation Site Deed. This conveyance shall be subject to all of the conditions, covenants, restrictions, and limitations imposed by this Agreement and by the Ahrens Relocation Site Deed. The Ahrens Relocation Site Deed shall be in recordable form and shall be promptly recorded by the Redeveloper. The Redeveloper shall pay all costs for such recording except the cost of the State deed transfer tax, if applicable. (b) Time of Conveyance. Subject to Unavoidable Delays, the Authority shall execute and deliver the Ahrens Relocation Site Deed to the Redeveloper on or about ,2002 (the "Date of Closing"). The Redeveloper shall take possession of the Ahrens Relocation Site on the Date of Closing. (c) Closing Requirements. Unless otherwise mutually agreed by the Authority and the Redeveloper, the execution and delivery of all closing documents and the payment of the Purchase Price shall be made at the principal offices of the Authority. The price to be paid by the Redeveloper for the conveyance of the Ahrens Relocation Site from the Authority to the Redeveloper shall be One Dollar ($1.00) (the "Purchase Price"). Section 3.5. Conditions Precedent to Conveyance. The obligations of the Authority to convey the Ahrens Relocation Site to the Redeveloper shall be subject to the following conditions precedent: (a) On the Date of Closing, the Redeveloper shall be in material compliance with all of the terms and provisions of this Agreement; (b) As of the Date of Closing, there shall have been no material adverse change in the Redeveloper's financial commitment and ability to finance construction of all components of the Minimum Improvements; (c) The Redeveloper shall have paid the Purchase Price; 15 (d) As of the Date of Closing, the Redeveloper shall be in compliance with all ordinances of the City; (e) The Redeveloper shall have provided a waiver, in form and content reasonably acceptable to the Authority, from the current owner of the Current Ahrens Site (or, if the Redeveloper has taken title to that site by the Date of Closing, from the previous owner) stating that that party waives any and all right to relocation benefits it may have under State or federal law in connection with the Redevelopment Project; (f) The Redeveloper shall, if required by the Authority, have provided five (5) executed originals of the Business Subsidy Agreement; (g) The Redeveloper shall have provided two (2) original access easements, in form and content reasonably acceptable to the Authority and the City, granting the City permanent, non-exclusive access across the Ahrens Relocation Site in order to facilitate construction and maintenance of the Regional Storm Water Pond. (h) Subject to the provisions of Section 10.13 of this Agreement, The Redeveloper shall have provided the Redeveloper Security, in order to guarantee construction of the Navarre Expansion. Section 3.6. Taxes and Special Assessmentq. The Authority shall pay all real estate taxes and all special assessments payable on the Ahrens Relocation Site prior to the year of closing. Real estate taxes and installments of special assessments payable in the year of closing shall be prorated as of the Date of Closing based on the parties' respective period of ownership. Subsequent to the year of closing the Redeveloper shall, for as long as it remains in title to the Ahrens Relocation Site, pay all real estate taxes and special assessments imposed on the Ahrens Relocation Site. Section 3.7. Adjustment of Revenue Note. The minimum principal amount of the Note shall be the sum of Two Hundred Thousand and No/100 Dollars ($200,000.00). This minimum amount shall be increased by the total documented, reasonable costs for eligible utilities relocation costs, as described in Schedule G of this Agreement, up to a maximum of an additional Two Hundred Fifty Thousand and No/100 Dollars. Accordingly, the maximum amount of the Note principal shall not exceed Four Hundred Fifty and No/100 Thousand Dollars ($450,000.00). Interest on the Note shall commence on the date shown on the Navarre Expansion Certificate of Completion. 16 ARTICLE IV Construction of Minimum Improvements Section 4.1. Construction of Minimum Improvements. The Redeveloper agrees that it will at its sole cost construct and/or provide for the construction of all components of the Minimum Improvements in accordance with Construction Plans approved by the Authority and by the City. The Redeveloper will commence construction of the New Ahrens Trucking Building on or about ,2002, and will commence construction of the Navarre Expansion no later than January 1, 2003. The Redeveloper shall pay for all environmental remediation, site preparation (including but not limited to soil correction and utilities relocation), PUD and other development costs for the Redevelopment Project, except for reasonable survey and plat costs relating to the Ahrens.Relocation Site which costs are to be paid by the City in accordance with Section 2.1 of this Agreement. In the event environmental remediation is required on any portion of the Redevelopment Property, the Authority will on behalf of the Redeveloper diligently pursue any eligible programs for reimbursement of such expenses. Section 4.2. Completion of Construction. Subject to Unavoidable Delays, the Redeveloper shall achieve substantial completion of the construction of the New Ahrens Building by December 31,2002, and shall achieve substantial completion of the conslruction of the Navarre Expansion on or about September 1, 2003. Once the Redeveloper has acquired the Ahrens Relocation Site, the Redeveloper agrees for itself, its successors and assigns, and every successor in interest to that property, or to any part thereof, that the Redeveloper, and such successors and assigns, shall diligently prosecute to completion the development of the New Ahrens Building, and that such construction shall in any event be completed within the corresponding period specified in this Section 4.2. Once the Redeveloper has acquired the Expansion Site, the Redeveloper agrees for itself, its successors and assigns, and every successor in interest to that property, or to any part thereof, that the Redeveloper, and such successors and assigns, shall diligently prosecute to completion the development of the Navarre Expansion, and that such construction shall in any event be completed within the corresponding period specified in this Section 4.2. Section 4.3. New Alu'ems Building Certificate of Completion and Release of Forfeiture. (a) Promptly after'notification from the Redeveloper that substantial completion of the New Ahrens Building has occurred in accordance with the provisions of this Agreement relating thereto (including but not limited to the date for completion thereof), the Authority will 17 furnish the Redeveloper with the New Ahrens Building Certificate of Completion and Release of Forfeiture. Such certification by the Authority shall be (and it shall be so provided in the certification itself) a conclusive determination of satisfaction and termination &the agreements and covenants in this Agreement with respect to the obligations of the Redeveloper, and its successors and assigns, to construct the New Ahrens Building and with respect to the obligations as to the date for the completion thereof. (b) If the Authority shall refuse or fail to provide the New Ahrens Building Certificate of Completion and Release of Forfeiture, the Authority shall within ten (10) days after receipt of written request by the Redeveloper provide the Redeveloper with a written statement indicating in adequate detail in what respects the Redeveloper has failed to complete the New Ahrens Building in accordance with the applicable provisions of this Agreement, or is otherwise in default, and what measures or acts the Authority believes will be necessary, in the Authority's reasonable discretion, for the Redeveloper to take or perform in order to obtain such certification. (c) The construction of the New Ahrens Building shall be deemed to be substantially complete when the Redeveloper has received an occupancy permit from the City's building inspector, without any conditions, for that building (or when such occupancy certificate has been issued with conditions that have been approved by the Authority, whose approval shall not be unreasonably withheld, conditioned or delayed). Section 4.4. Navarre Expansion Certificate of Completion. (a) Promptly after notification from the Redeveloper that substantial completion of the Navan'e Expansion has occurred in accordance with the provisions of this Agreement relating thereto (including but not limited to the date for completion thereof), the Authority will furnish the Redeveloper with the Navarre Expansion Certificate of Completion. Such certification by the Authority shall be (and it shall be so provided in the certification itself) a conclusive determination of satisfaction and termination of the agreements and covenants in this Agreement with respect to the obligations of the Redeveloper, and its successors and assigns, to consU'uct the Navarre Expansion and with respect to the obligations as to the date for the completion thereof. Co) If the Authority shall refuse or fail to provide the Navarre Expansion, the Authority shall within ten (10) days after receipt of written request by the Redeveloper provide the Redeveloper with a written statement indicating in adequate detail in what respects the Redeveloper has failed to complete the Navarre Expansion in accordance with the applicable provisions of this Agreement, or is otherwise in default, and what measures or acts the Authority believes will be necessary, in the Authority's reasonable discretion, for the Redeveloper to take or perform in order to obtain such certification. 18 (c) The construction of the Navarre Expansion shall be deemed to be substantially complete when the Redeveloper has received an occupancy permit from the City's building inspector, without any conditions, for that expansion area (or when such occupancy certificate has been issued with conditions that have been approved by the Authority, whose approval shall not be unreasonably withheld, conditioned or delayed). 19 ARTICLE V Events of Default Section 5.1. Events of Default Defined. The following shall be "Events of Default" under this Agreement and the term "Event of Default" shall mean whenever it is used in this Agreement any one or more of the following events: (a) Failure by the Redeveloper to timely pay all ad valorem real property taxes assessed with respect to all portions of the Redevelopment Property to which it holds title. (b) Failure by the Redeveloper to complete the Minimum Improvements, or any portion thereof, pursuant to the terms, conditions and limitations of this Agreement. (c) The holder of any Mortgage on the Redevelopment Property, any improvements thereon, or any portion thereof commences foreclosure proceedings and such proceedings proceed to a sale as a result of any default under the applicable Mortgage documents. (d) Failure by the Redeveloper to substantially observe or perform any other covenant, condition, obligation or agreement on the Redeveloper's part to be observed or performed under this Agreement. (e) If the Redeveloper shall: (A) File any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act of 1978, as may be amended from time to time, or under any similar federal law or similar law of any state of the United States or similar law of any other country; or (B) Make an assignment for the benefit of its creditors; or or (c) Admit in writing its inability to pay its debts generally as they become due; (D) Be adjudicated as bankrupt or insolvent; or if a petition or answer proposing the adjudication of the Redeveloper as bankrupt or proposing its reorganization under any present or furore federal bankruptcy act or any similar federal law or similar law of any state of the United States or similar law of any other country shall be filed in any court and such petition or answer shall not be discharged or denied 2O within ninety (90) days after the filing thereof; or a receiver, trustee or liquidator of the Redeveloper, or &the Redevelopment Project while Redeveloper is in title thereto, or of any part of the Redevelopment Project while Redeveloper is in title thereto, shall be appointed in any proceeding brought against the Redeveloper, and shall not be discharged within ninety (90) days after such appointment, or if the Redeveloper shall consent to or acquiesce in such appointment. Section 5.2. Remedies on Default. Whenever any Event of Default referred to in Section 5.1 of this Agreement occurs and is continuing, the Authority, as specified below, may take any one or more of the following actions after providing notice of at least thirty (30) days to the Redeveloper, but only if the Event of Default has not been cured within said thirty (30) days or if the Redeveloper is not making its best efforts to cure a default which cannot be cured within thirty (30) days: (a) The Authority may suspend its performance under this Agreement until it receives assurances from the Redeveloper, deemed adequate by the Authority in its reasonable discretion, that the Redeveloper will cure the default and continue performance under this Agreement; (b) The Authority may cancel and rescind the Agreement; (c) The Authority may withhold the New Ahrens Building Certificate of Completion and Release of Forfeiture and/or the Navarre Expansion Certificate of Completion. Section 5.3. Revesting Title in Authority Upon Happening of Event Subsequent to Conveyance to Redeveloper. In the event that subsequent to the conveyance of the Ahrens Relocation Site to the Redeveloper and prior to receipt by the Redeveloper of the New Ahrens Building Certificate of Completion and Release of Forfeiture: (a) subject to Unavoidable Delays, the Redeveloper fails to carry out its obligations with respect to the construction of the New Ahrens Building (including the nature and the date for the initiation and completion thereof), or abandons or substantially suspends construction work, and any such failure, abandonment, or suspension shall not be cured, ended, remedied or assurances reasonably satisfactory to the Authority made within sixty (60) days after written demand from the Authority to the Redeveloper to do so; or Co) the Redeveloper creates, suffers, assumes, or agrees to any encumbrance or lien on the Ab_rem Relocation Site which is unauthorized by this Agreement, or shall suffer any levy or attachment to be made, or any materialmen's or mechanics' lien, or any other unauthorized encumbrance or lien to attach, and such taxes or assessments shall not have been paid, or the encumbrance or lien removed or 21 discharged or provision reasonably satisfactory to the Authority made for such payment, removal, or discharge, within thirty (30) days after written demand by the Authority to do so; provided, that if the Redeveloper shall first notify the Authority of its intention to do so, it may in good faith contest any mechanics' or other lien filed or established and in such event the Authority shall permit such mechanics' or other lien to remain undischarged and unsatisfied during the period of such contest and any appeal, but only if the Redeveloper provides the Authority with a bank letter of credit, a statutory lien bond as provided by Minnesota Statutes or other reasonable security in the amount of the lien, in a form satisfactory to the Authority, pursuant to which the bank or other obligor will pay to the Authority the amount of any lien in the event that the lien is finally determined to be valid. During the course of such contest the Redeveloper shall diligently keep the Authority informed respecting the status of such defense; or (c) there is, in violation of Article VI of this Agreement, any transfer of the Ahrens Relocation Site, or any part thereof, or any change with respect to the identity of the parties in control of the Redeveloper and such violation shall not be cured within sixty (60) days after written demand by the Authority to the Redeveloper; Then the Authority shall have the right to re-enter and take possession of the Ahrens Relocation Site and to terminate (and revest in the Authority) the estate conveyed by the Ahrens Relocation Site Deed, it being the intent of this provision, together with other provisions of the Agreement, that the conveyance of the Ahrens Relocation Site to the Redeveloper shall be made upon, and that the Ahrens Relocation Site Deed shall contain a condition subsequent to the effect that, the understanding that in the event of any default on the part of the Redeveloper and failure on the part of the Redeveloper to remedy, end, or abrogate such default within the period and in the manner stated in this Agreement, the Authority at its option may declare a termination in favor of the Authority of the title and of all the rights and interests in and to the Ahrens Relocation Site conveyed to the Redeveloper, and that such title and all rights and interests of the Redeveloper, and any assigns or successors in interest to and in the Ahrens Relocation Site, shall revert to the Authority, but only if all applicable events stated in Subsection 5.3.(a)-(c) have not been cured within the time periods provided above. NotwithStanding anything to the contrary contained in this Section 5.3, the Authority shall have no right to re-enter or retake title to and possession of the Ahrens Relocation Site once the New Ahrens Building Certificate of Completion and Release of Forfeiture has been issued or if the Authority has subordinated its rights to the Holder of a Mortgage as provided for in Section 10.10 of this Agreement. Section 5.4. Resale of Reacquired Property; Disvosition of Proceecls and Earnest Money. Upon the revestmg in the Authority of title to the Ahrens Relocation Site as provided in Section 22 5.3 of this Agreement, the Authority shall have no further responsibility to the Redeveloper or to any third party with respect to the Ahrens Relocation Site, and the Authority may sell or otherwise devote the Ahrens Relocation Site to such other uses as the Authority shall, in its sole discretion, determine and the Authority shall in no way be obligated to reimburse the Redeveloper or any third party for any sums paid with respect to the Ahrens Relocation Site. Section 5.5. No Remedy Exclusive. No remedy herein conferred upon or reserved to a Party is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. Section 5.6. No Implied Waiver. In the event any provision or term contained in this Agreement should be breached by any Party and thereafter waived by any 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 5.7. Agreement to Pay Attorney's Fees and Expenses. Whenever any Event of Default occurs and the Authority shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement or performance or observance of any obligation or agreement on the part of the Redeveloper herein contained, the Redeveloper agrees that it shall, on demand therefor, pay to the Authority the reasonable fees of such attorneys and such other reasonable expenses so incurred by the Authority. 23 ARTICLE VI Prohibitions Against Assignment and Transfer Section 6.1. Representation as to Redevelopment. The Redeveloper represents and agrees that its purchase of the Ahrens Relocation Site, and all of its other undertakings pursuant to this Agreement, are and will be used for the purpose of redevelopment of the Redevelopment Property and not for speculation in land holding. The Redeveloper further recognizes that, in view of (a) the importance of the redevelopment of the Redevelopment Property to the general welfare of the Authority, and (b) the substantial financing that has been made available by the Authority for the purpose of making such redevelopment possible, the qualifications and identity of the Redeveloper are of particular concern to the Authority. The Redeveloper further recognizes that it is because of such qualifications and identity that the Authority is entering into this Agreement with the Redeveloper, and, in so doing, is further willing to accept and rely on the obligations of the Redeveloper for the faithful performance of all undertakings and covenants hereby by it to be performed. Section 6.2. Prohibition Against Transfer of Property. and Assignment of Agreement. Also for the foregoing reasons, the Redeveloper represents and agrees that prior to the date of the New Ahrens Building Certificate of Completion as provided in Section 4.3, except for the purpose of obtaining financing necessary to enable the Redeveloper or any successor in interest to the Ahrens Relocation Site, or any part thereof, to perform its obligations with respect to construction the New Ahrens Building under this Agreement, and any other purpose authorized by this Agreement, the Redeveloper has not made or created and will not make or create or suffer to be made or created any total or partial sale, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to the portion of this Agreement applicable to the Ahrens Relocation Site and/or the New Ahrens Building, or of or with respect to the Ahrens Relocation Site and/or the New Ahrens Building, or any part thereof or any interest therein, or any contract or agreement (oral or written) to do any of the same, without the prior written approval of the Authority which shall not be unreasonably withheld, conditioned or delayed; provided that no Authority approval shall be required where the Redeveloper remains liable and bound by the terms of this Redevelopment Agreement applicable to the Ahrens Relocation Site and the New Ahrens Building. Any such transfer of interest shall be subject to all provisions of this Agreement applicable to the Ahrens Relocation Site and the New Ahrens Building. Notwithstanding the foregoing language, the Redeveloper may transfer the Ahrens Relocation Site and/or the New Ahrens Building to any corporation, partnership or entity controlling, controlled by, or under common control with the Redeveloper and the Redeveloper further after the issuance of the New Ahrens Building Certificate of Completion and Release of Forfeiture may sell, lease or otherwise transfer the Ahrens Relocation Site and/or the New Ahrens Building as the Redeveloper sees fit. 24 ARTICLE VII Insurance and Condemnation Section 7.1. Insurance. (a) The Redeveloper will provide and maintain at all times dunng the process of constructing each portion of the Minimum Improvements and, from time to time at the request of the Authority, furnish the Authority with proof of payment of premiums on: (i) builder's risk insurance, written on the so-called "Builder's Risk -- Completed Value Basis," in an amount equal to one hundred percent (100%) of the insurable value (as of the date of completion) of the portion of the Minimum Improvements under construction, and with coverage available in non-reporting form on the so-called "all risk" form of policy. The interest of the Authority shall be protected in accordance with a clause in form and content reasonably satisfactory to the Authority; (ii) comprehensive general liability insurance together with an owner's contractor's policy with limits against bodily injury and property damage of not less than $2,000,000 for each occurrence (to accomplish the above-required limits, an umbrella excess liability policy may be used); and (iii) workers' compensation insurance, with statutory coverage. (b) Upon completion of construction of the New Ahrens Building, and until the date it is sold, leased or otherwise transferred as allowed under this Agreement, the Redeveloper shall maintain, or cause to be maintained, at its cost and expense, and from time to time at the request of the Authority shall furnish proof of the payment of premiums on, insurance as follows: (i) Insurance against loss and/or damage to the Ahrens Relocation Site and the New Ahrens Building under a policy or policies covering such risks as are ordinarily insured against by similar businesses, including (without limiting the generality of the foregoing) fire, extended coverage, vandalism and malicious mischief, boiler explosion, water damage, demolition cost, debris removal, and collapse in an amount not less than the full insurable replacement value of such improvements, but any such policy may have a deductible amount of not more than $25,000.00. No policy of insurance shall be so written that the proceeds thereof will produce less than the minimum coverage required by. the preceding sentence, by reason of co-insurance provisions or otherwise, without the prior consent thereto in writing by the Authority. The term "full insurable replacement value" shall mean the actual replacement cost of the New Ahrens Building (excluding 25 foundation and excavation costs and costs of underground flues, pipes, drains and other uninsurable items) and equipment, if any, and may be determined from time to time at the request of the Authority, but not more frequently than once every five (5) years, by an insurance consultant or insurer, selected and paid for and approved by the Authority. All policies evidencing insurance required by this Subsection (b)(i) with respect to the Ahrens Relocation Site and the New Ahrens Building shall be camed in the names of the Redeveloper, the mortgagee of the Redeveloper, and the Authority as their respective interests may appear and shall contain standard clauses which provide for net proceeds remaining after the deduction of expenses incurred in the collection of such proceeds (hereafter referred to as the "Net Proceeds") of insurance resulting from claims per casualty thereunder to the Ahrens Relocation Site and/or the New Ahrens Building which are equal to or less than $750,000.00 for loss or damage covered thereby to be made payable directly to the Redeveloper and/or its mortgagee, and Net Proceeds from such claims in excess of $750,000.00 to be made payable jointly to the Redeveloper, its mortgagee and the Authority. The Authority, the Redeveloper and the Redeveloper's mortgagee shall jointly agree on the amount of settlement. (ii) Comprehensive general pubic liability insurance, including personal injury liability, against liability for injuries to persons and/or property, in the minimum amount for each occurrence and for each year of $2,000,000.00, and shall be endorsed to show the Authority as additional insured. (c) Upon completion of construction of the Navarre Expansion, and until the Termination Date, the Redeveloper shall maintain, or cause to be maintained, at its cost and expense, and from time to time at the request of the Authority shall furnish proof of the payment of premiums on, insurance as follows: (i) Insurance against loss and/or damage to the Expansion Site and the Navarre Expansion under a policy or policies covering such risks as are ordinarily insured against by similar businesses, including (without limiting the generality of the foregoing) fire, extended coverage, vandalism and malicious mischief, boiler explosion, water damage, demolition cost, debris removal, and collapse in an amount not less than the full insurable replacement value of such improvements, but any such policy may have a deductible amount of not more than $25,000.00. No policy of insurance shall be so written that the proceeds thereof will produce less than the minimum coverage required by the preceding sentence, by reason of co-insurance provisions or otherwise, without the prior consent thereto in writing by the Authority. The term "full insurable replacement value" shall mean the actual replacement cost of the Navarre Expansion (excluding foundation and excavation costs and costs of underground flues, pipes, drains and other uninsurable items) and equipment and may be determined from time to time at the request of the Authority, but 26 not more fi-equently than once every five (5) years, by an insurance consultant or insurer, selected and paid for and approved by the Authority. All policies evidencing insurance required by this Subsection (c)(i) with respect to the Expansion Site and the Navarre Expansion shall be carried in the names of the Redeveloper, the mortgagee of the Redeveloper, and the Authority as their respective interests may appear and shall contain standard clauses which provide for the Net Proceeds (as defined in Subsection (b) above) of insurance resulting from claims per casualty thereunder to the Expansion Site and/or the Navarre Expansion are equal to or less than $750,000.00 for loss or damage covered thereby to be made payable directly to the Redeveloper and/or its mortgagee, and Net Proceeds from such claims in excess of $750,000.00 to be made payable jointly to the Redeveloper, its mortgagee and the Authority. (ii) The Authority, the Redeveloper and the Redeveloper's mortgagee shall jointly agree on the amount of settlement. (d) All insurance required by this Article VIII shall be taken out and maintained in responsible insurance companies selected by the Redeveloper, which are authorized under the laws of the State to assume the risks covered thereby. The Redeveloper will deposit annually with the Authority policies evidencing all such insurance, or a certificate or certificates or binders of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Article VIII, each policy shall contain a provision that the insurer shall not cancel nor modify the policy without giving written notice to both the Redeveloper 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 required policy, the Redeveloper shall furnish the Authority evidence satisfactory to the Authority that the required policy has been renewed or replaced by another policy conforming to the provisions of this Article VIII, or that there is no necessity for such renewal or replacement under the terms of this Agreement. In lieu of separate policies, the Redeveloper may maintain a single policy, blanket or umbrella policies, or a combination thereof, having the coverage required herein, in which event the Redeveloper shall deposit with the Authority a certificate or certificates of the respective insurers as to the amount of coverage in force. (e) The Redeveloper agrees to notify the Authority immediately in the case of damage exceeding $100,000.00 in amount to, or destruction of, the New Ahrens Building or any portion thereof(while such real property is owned or controlled by the Redeveloper) or such damage to or destruction of the Navarre Expansion, whether any such damage or destruction results from fh'e, tornado or other type of casualty. In the event that any such damage or destruction does not equal or exceed $750,000.00, the Redeveloper will forthwith repair, reconstruct and restore the damaged or destroyed improvements to substantially the same or to an improved condition or 27 value as the improvements existed prior to the event causing such damage or destruction and, to the extent necessary to accomplish such repair, insurance relating to such damage or destruction received by the Redeveloper shall be applied to the payment or reimbursement of the costs thereof. Net Proceeds of any insurance relating to such damage up to $750.000.00 shall be paid directly to the Redeveloper. In the event the New Ahrens Building or any portion thereof (while such properly is owned or controlled by the Redeveloper) or the Navarre Expansion or any portion thereof are damages or destroyed by fire, tornado or other casualty and the damage or destruction is estimated to equal or exceed $750,000.00, then the Redeveloper shall within one hundred and twenty (120) days after such damage or destruction proceed forthwith to repair, reconstruct and restore the damaged improvements to substantially the same condition or value as existed prior to the event causing such damage or destruction and, to the extent necessary to accomplish such repair, reconstruction and restoration, the Redeveloper, the Redeveloper's mortgagee and the Authority will apply the Net Proceeds of any insurance relating to such damage or destruction received by the mortgagee and/or the Authority to the payment or reimbursement of the costs thereof. Any Net Proceeds remaining after completion of construction shall be disbursed to the Redeveloper. (f) If the Redeveloper is in compliance with the terms and conditions of this Agreement, then any Net Proceeds of insurance relating to such damage or destruction received by the Authority shall be released from time to time by the Authority to the Redeveloper upon the receipt of: (i) A certificate of an authorized representative of the Redeveloper specifying the expenditures made or to be made or the indebtedness incurred in connection with such repair, reconstruction and restoration and stating that such Net Proceeds, together with any other moneys legally available for such purposes, will be sufficient to complete such repair, construction and restoration; and (ii) If Net Proceeds equal or exceed $750,000.00 in total amount, the written approval of such certificate by an independent engineer approved by the Authority. The Redeveloper shall complete the repair, reconstruction and restoration of the affected improvements whether or not the Net Proceeds of insurance received by the Redeveloper for such purposes are sufficient to pay for the same. Any Net Proceeds remaining after completion of such repairs, construction and restoration shall be remitted to the Redeveloper. Section 7.2. Condemnation. If title to and possession of the Ahrens Relocation Site and/or the Expansion Site, or any material part thereof, shall be taken in condemnation or by the exercise of the power of eminent domain or deed in lieu of condemnation, by any governmental 28 body or other person (except the Authority or the City) prior, in the case of the Ahrens Relocation Site or portion thereof, to the date the Redeveloper relinquishes ownership or control to an individual or entity other than said condemning authority and, in the case of the Expansion Site or portion thereof, prior to the Termination Date, then the Redeveloper shall, with reasonable prompmess after such taking, notify the Authority as to the nature and extent of such taking. Upon receipt of any condemnation award the Redeveloper shall use such portion of the award as is necessary to reconstruct the affected improvements, if any. Section 7.3. Insurance Subordination. Notwithstanding anything to the contrary contained in this Agreement, the rights of the Authority with respect to the receipt and application of the proceeds of insurance or condemnation shall be subject and subordinate to the rights of any holder of any Mortgage. 29 ARTICLE VIH Taxes and Pledge of Increment Section 8.1. Real Property Taxes. (a) The Redeveloper shall pay when due, prior to the attachment of penalty: (i) all real property taxes payable with respect to the Ahrens Relocation Site or a portion thereof, in either case whether improved or unimproved, while Redeveloper is in title to the site; and (ii) all real property taxes payable with respect to the Expansion Site or a portion thereof, in either case whether improved or unimproved, until the Termination Date; provided that such obligation shall end if the Authority has released the Redeveloper in writing from such obligation in connection with an approved transfer of that site as allowed by this Agreement. (b) The Redeveloper agrees that, for the same time periods outlined in Subsection 8.1 (a)(i) and (a)(ii) of this Agreement, it will not take any of the following actions with respect to the Ahrens Relocation Site, the Expansion Site, or any portion of those sites to the extent that such actions would result in reduced assessed valuation of the property or properties (or portion thereof), as applicable: (i) seek administrative review or judicial review of the applicability of any property tax statute determined by any tax official to be applicable to the property or properties (or portion thereof) or raise the inapplicability of any such property tax statute as a defense in any proceedings, including delinquent tax proceedings; (ii) seek adminislrative review or judicial review of the constitutionality of any property tax statute determined by any tax official to be applicable to the property or properties (or portion thereof) or raise the unconstitutionality of any such property tax statute as a defense in any proceedings, including delinquent tax proceedings; (iii) cause a reduction in the assessed market value of the property or properties (or portion thereof) through: (A) willful destruction; (B) willful refusal to reconstruct or repair as required by Article VIII of this Agreement; (C) a request to an assessor of the City or an assessor of the County to reduce the assessed market value; (D) a petition to the board of equalization of the City or the board of equalization of the County or a similar governing body to reduce assessed market value; (E) a petition to the board of equalization of the State or similar governing body or to the State's Commissioner of Revenue or his or her agency to reduce the assessed market value; (F) an action in a District Court of the State or the Tax Court of the State pursuant to Minnesota Statutea, Chapter 278, as may be amended from time to time, or pursuant to any similar State or federal law, seeking a reduction in assessed market value; (G) an 30 application to the State's Commissioner of Revenue or his or her agency requesting an abatement of real property taxes pursuant to Minnesota Statutes, Chapter 270, as may be amended from time to time or pursuant to any similar State or federal law; (H) any other proceedings, whether administrative, legal or equitable, with any administrative body within the City, the County, or the State or with any court of the State or with any body of the federal government or with any federal court; and/or (I) an application for a deferral of property tax pursuant to Minnesota Statutes, Section 469.181, as may be amended from time to time or pursuant to any similar State or federal law. Section 8.2. Tax Increment Pledge. Until the Termination Date, the Authority shall pledge 82% of the Available Tax Increment to payment of the Note. 31 ARTICLE IX Termination Section 9.1. Termination. Either Party may terminate this Agreement as provided hereto, and otherwise this Agreement shall terminate upon its Termination Date and the discharge of all of the Parties' other respective obligations hereunder, but no such termination shall terminate any indemnification or other rights or remedies arising hereunder due to any Event of Default which occurred and was continuing prior to such termination. Section 9.2. Effect of Termination. Upon a termination of this Agreement pursuant to this Article IX, this Agreement shall be null and void and neither Party shall have any further obligations or liabilities hereunder except as specifically stated m this Agreement. Upon such termination the Redeveloper and the Authority shall deliver to each other such documents as may be necessary to evidence the temamation of this Agreement. 32 ARTICLE X Additional Provisions Section 10.1. Conflict of Interests. No member, official, or employee of the Authority shall have any personal interest, direct or indirect, in this Agreement, nor shall any such member, official or employee participate in any decision relating to the Agreement which affects his or her personal interests or the interests of any corporation, partnership, or association in which he or she is, directly or indirectly, interested. Section 10.2. Restrictions on Use. The Redeveloper shall not discriminate upon the basis of race, color, creed, sex, national origin or any other basis prohibited by federal or State law when selling, leasing, renting, using or occupying the Redevelopment Property, any portion thereof, any improvements erected or to be erected thereon, or any portion of such improvements. Section 10.3. Titles of Articles and Sections. Any titles of the several parts, articles and sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 10.4. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand or other communication pursuant to this Agreement made by either Party to the other shall be deemed sufficiently given or delivered if such communication is dispatched by registered or certified mail, postage prepaid, return receipt requested, transmitted by facsimile (with confirmation of transmittal received), delivered by a recognized overnight courier, or delivered personally and: (a) in the case of the Redeveloper, is addressed to or delivered personally to the address in the first paragraph of this Agreement or such address as the Redeveloper will from time to time furnish to the Authority in writing. (b) in the case of the Authority, is addressed to or delivered personally to the address in the first paragraph of this Agreement or such address as the Authority will from time to time furnish to the Redeveloper in writing. Section 10.5. Indemnification of AuthoriW. 33 (a) The Redeveloper hereby releases the Authority, the City and the governing body members, officers, agents (including independent contractors), consultants, legal counsel, servants, and employees thereof (hereinafter, for purposes of this Agreement. collectively the "Indemnified Parties") from and agrees to indemnify and hold harmless the Indemnified Parties against any loss or damage to property (real or personal) or any injury to or death of any person occurring at or about or resulting from any defect in the Minimum Improvements. the Redevelopment Property, or any portion thereof. The Redeveloper also hereby covenants and agrees that, with the exception of willful negligence of the Indemnified Parties, the Indemnified Parties shall not be liable for such losses or damages. (b) Except for any willful misrepresentation or any willful or wanton misconduct of the Indemnified Parties, the Redeveloper agrees to protect and defend the Indemnified Parties, now and forever, and further agrees to hold the Indemnified Parties harmless from any claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising under this Agreement from the actions or inactions of the Redeveloper (or of other persons or entities acting on the Redeveloper's behalf or under the Redeveloper's direction or control), or the acquisition, construction, installation, ownership, and operation of the Minimum Improvements or the Redevelopment Property, or any portion thereof; provided that this indemnification shall not apply to any warranties made or obligations undertaken by the Authority in this Agreement. (c) All representations, covenants, stipulations, promises, agreements and other obligations whatsoever of the Authority contained herein shall be deemed to be the representations, covenants, stipulations, promises, agreements and other obligations of the Authority and not of any governing body member, officer, agent (including independent contractors), consultants, legal counsel, servant or employee of the Authority. Section 10.6. Counterparts. This Agreement may be executed in any number of counterparts, each of which is binding on a Party upon that Party's execution and together which shall constitute one and the same inslrument. Section 10.7. Law Governing. This Agreement will be governed and construed in accordance with the laws of the State. Section 10.8. Expiration. Subject to the provisions of Article ~ of this Agreement, this Agreement shall expire and terminate on the later of: (i) the date the Note is paid in full; (ii) the date the Note terminates; or (iii) the date the Tax Increment District dissolves or otherwise terminates. 34 Section 10.9. Provisions Surviving Rescission or Expiration. Sections 5.7 and 10.5 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 10.10. Subordination of Authority's Rights Under the Agreement. (a) The Authority recognizes that the Redeveloper intends to finance the construction of the Project (the "Construction Loan") and that m order to do so the construction lender (the "Lender") may require a first priority Mortgage on the Redevelopment Properly which is prior to the Redevelopment Property Deed and the Authority's rights under this Agreement. As a condition to such subordination, the Redeveloper agrees that m connection with the Construction Loan: (i) The Construction Loan proceeds will be used solely for the design, development, construction and financing of the Redevelopment Project; (ii) The Construction Loan proceeds will be disbursed by a title company pursuant to a construction loan and disbursing agreement or similar agreement among the Redeveloper, the Lender and the title company whereby the title company will coordinate the payment for all work which may give rise to mechanics' liens; (iii) The Authority shall have the right to review the Construction Loan documents to reasonably satisfy itself that sufficient funds are or will be available to complete construction of the Redevelopment Project. (b) Upon Redeveloper's performing the above conditions, the Authority agrees that any and all rights of the Authority under this Agreement and the Redevelopment Properly Deed shall be subordinate to the rights of the Lender, subject to the exceptions set forth in Subsection 10.10(c) of this Agreement: (i) any and all rights of the Authority to the payment or use of the net proceeds of insurance pursuant to Article VII hereof; and (ii) any and all fights of the Authority to re-enter and retake possession of the Ahrens Relocation Site and to re-vest in the Authority the estate conveyed by the Ahrens Relocation Site Deed, including rights of the Authority pursuant to Section 5.3 of this Agreement and pursuant to the Redevelopment Property Deed, shall be subject and subordinate to the lien of the Mortgage and to the rights, interests and remedies of the Lender and its successors and assigns (including the purchaser at any foreclosure sale or the transferee of any transfer in lieu of foreclosure) under the Mortgage. 35 The Authority further covenants and agrees that a purchaser at a foreclosure sale or the transferee of any transfer m lieu of foreclosure shall take title to the mortgaged property free and clear of all rights of the Authority, its successors and assigns under this Agreement. The Authority further agrees that at the time of closing of the Conslruction Loan, it will enter into subordination agreements, in form and content reasonably acceptable to Lender, from time to time in accordance with this Section 10.10. (c) The following shall be exceptions to the Authority's obligation to subordinate its rights under Subsection 10.10(b) of this Agreement: (i) Article IX (ii) Article VIII (iii) Section 2.2(0) (iv) Section 2.2(n) (v) Section 2.2(m) (vi) Section 2.20) (vii) Section 2.2(k) Section 10.11 .Provisions Not Merged With Assignment. None of the provisions of this Agreement are intended to or shall be merged by reason of any assignment transferring any interest in the Redevelopment Property, or a portion thereof, and any such assignment shall not be deemed to affect or impair the provisions and covenants of this Agreement. Section 10.12.No Third Party Beneficiaries. There shall be no third-party beneficiaries to this Agreement. More specifically, the Authority enters into this Agreement, and the City agrees to facilitate this Agreement, with the intent that the consummation of the Authority and City obligations contemplated hereby shall be for the sole and exclusive benefit of the Redeveloper, and notwithstanding the fact that any other "person" may ultimately participate in or have an interest m the Project, or any portion thereof, neither the Authority nor the City intends that any party other than the Redeveloper shall have, as alleged third party beneficiary or otherwise, any rights or interests hereunder as against the Authority orthe City, and no such other party shall have standing to complain of the Authority's and/or City's exercise of, or alleged failure to exercise, rights and obligations under this Agreement and/or to complain of the Authority's or City's performance or alleged lack thereof under this Agreement. Section 10.13.Redeveloper Security. In order .to guarantee completion of the Redevelopment Project, the Redeveloper shall provide the Redeveloper Security as required by Section 3.5 of this Agreement. Upon sufficient completion of the Site Improvements and Public Improvements for the Expansion Site, the Redeveloper shall notify the Authority that 36 construction of the Navarre Expansion has commenced and the Authority shall promptly thereafter provide a satisfaction of mortgage (in form and content reasonably acceptable to the Redeveloper) and shall void and remm the promissory note provided as part of the Redeveloper Security. IN WITNESS WItEREOF, the Authority and the Redeveloper have each caused this Agreement to be duly executed in its own name and behalf, intending to be bound thereby, as of the date first above written. [The Balance of this Page is Intentionally Left Blank] 38 NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY By Its President And by Its Executive Director Date: STATE OF MINNESOTA ) ) ss COUNTY OF HENNEPIN ) On this ~ day of ,2002 before me, a Notary Public, personally appeared and to me personally known and who by me duly sworn did say that they are the President and Executive Director of the New Hope Economic Development Authority, and acknowledged the foregoing instrument on behalf of said Authority. Notary Public Authority Signature Page - Redevelopment Contract 39 NAVARRE CORPORATION By Its And By Its STATE OF MINNESOTA ) ) ss COUNTY OF ) On this ~ day of ,2002, before me, a Notary Public, appeared and , to me personally known and who by me duly sworn did state that they are the and respectively, of Navarre Corporation, a Minnesota corporation, and acknowledged the foregoing instrument on behalf of said corporation. Notary Public Redeveloper Signature Page - Redevelopment Contract G:\WPDATAkNANEW HOPEV)8~d)OCAREDEVELOP~ CONTRACT 8-29-02 - CLEAN.DOC 4O SCHEDULE A REDEVELOPMENT PROPERTY See Map Attached as Schedule A-1 41 EXHIBIT 1 TO SCHEDULES A and A-1 CURRENT AHRENS SITE LEGAL DESCRIPTION [To Be Provided by the Redeveloper] 42 EXH~ 2 TO SCHEDULES A and A-1 AHRENS RELOCATION SITE LEGAL DESCRIPTION [To Be Provided by the Redeveloper] 43 SCHEDULE B REGIONAL STROM WATER POND SITE See Map Attached as Schedule B-1 SCHEDULE C NAVARRE PROPERTY LEGAL DESCRIPTION [To Be Provided by the Redeveloper] 45 SCHEDULE D FORM OF AHRENS RELOCATION SITE DEED DEED TAX DUE: $ Date: ,2002 DEED THIS INDENTURE, made this ~ day of ,2002, between the New Hope Economic Development Authority, a public body corporate and politic under the laws of Minnesota (the "Grantor"), and , a organized under the laws of the State of Minnesota (the "Grantee"). WITNESSETH, that Grantor, in consideration of the sum of One Dollar ($1.00) and other good and valuable consideration the receipt whereof is hereby acknowledged, does hereby convey and quit claim to the Grantee, its successors and assigns forever, all the tract or parcel of land lying and being in the County of Hennepin and State of Minnesota described as follows: The Grantee has comm/tted to construct certain improvements on said land and the Grantor has a fight of re-entry in accordance with Sections 4.3 and 5.3 respectively of the Contract for Private Redevelopment By and Between the New Hope Economic Development Authority and Navarre Corporation, dated as of ,2002. The completion of the improvements and the release of the right of re-entry shall be evidenced by the recording of the Certificate of Completion and Release of Forfeiture attached as Exhibit 1 to this Deed. The Grantor certifies that the Grantor does not know of any wells on the described real property. 46 IN WITNESS WHEREOF, the Grantor has caused this Deed to be duly executed in its behalf by its President and its Executive Director on the day and year written above. NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY By: Its: President And By: Its: Executive Director STATE OF MINNESOTA ) ) ss COUNTY OF HENNEPIN ) On this ~ day of ,2002 before me, a Notary Public, personally appeared and to me personally known and who by me duly sworn did say that they are the President and Executive Director, respectively, of the New Hope Economic Development Authority, and acknowledged the foregoing instrument on behalf of said Authority. This instrument was drafted by: Krass Monroe, P.A. (CMK) Suite 1100 Southpoint Office Center 1650 West 82nd Street Minneapolis, MN 55431 (952) 885-5999 Notary Public Tax Statements for the real property described in this instrument should be sent to (include name and address of Grantee): 7460 - 49~' Avenue North New Hope, MN 55428 Atto: John Turner, Sr. Vice President 47 EXHIBIT 1 To Deed [Certificate of Completion in Same Form as Schedule E attached to this A~eement] 48 SCHEDULE E NEW AHRENS BUILDING CERTIFICATE OF COMPLETION AND RELEASE OF FORFEITURE WHEREAS, the New Hope Economic Development Authority, a public body corporate and politic under the laws of the State of Minnesota (the "Grantor"), by a Deed recorded in the Office of the County Recorder and/or the Registrar of Titles in and for the County of Hennepin State of Minnesota, as Deed Document Number(s) , has conveyed to , a organized under the laws of the State of Minnesota (the "Grantee"), the following described land in County of Hennepin and State of Minnesota: WHEREAS, the Deed contained certain covenants, conditions 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 the Deed; and WHEREAS, the Grantee has performed said covenants, conditions and restrictions insofar as the Grantee is able and in a manner deemed sufficient by the Grantor to permit the execution and recording of this certification; NOW, THEREFORE, this is to certify that all building construction and other physical improvements specified to be done and made by the Grantee pursuant to the Deed have been completed and/or caused by the Grantee and this is further to certify that the provisions for forfeiture of title and fight to re-entry for breach of condition subsequent by the Grantor therein are hereby released absolutely and forever insofar as they apply to the land described in this certification, and the County Recorder and/or the Registrar of Titles in and for the County of Hennepin, State of Minnesota is/are hereby authorized to accept for recording and to record this instrument, and the filing of this instrument shall be a conclusive determination of the satisfactory termination of the covenants, conditions and restrictions described in the Deed, and in the contract cited therein, and relating to the land described in this certification, the breach of which covenants, conditions and/or restrictions would have resulted in a forfeiture and fight of re-entry. [The Remainder of This Page is Intentionally Left Blank] 49 Dated: ,20 NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY By Its Chairman And by Its Executive Director STATE OF MINNESOTA ) ) ss COUNTY OF ) On this ~ day of ,20__ before me, a Notary Public, personally appeared and , to me personally known and who by me duly sworn did say that they are the Chairman and Executive Director, respectively of the New Hope Development Authority, and acknowledged the foregoing instrument on behalf of said Authority. Notary Public 5o SCHEDULE F EXPANSION SITE CERTIFICATE OF COMPLETION WHEREAS, the New Hope Economic Development Authority, a public body corporate and politic under the laws of the State of Minnesota (the "Authority"), has previously entered into a Contract for Private Redevelopment dated as of , 2002 (the "Contract") with Navarre Corporation, a Minnesota corporation (the "Redeveloper"); and WHEREAS, the Contract required the Redeveloper to make certain improvements to the following described land in County of Hennepin and State of Minnesota, in the event that the Redeveloper acquired such land during the term of the Contract: WHEREAS, the Contract contained certain covenants, conditions and restrictions, the breach of which by the Redeveloper and its successors and assigns would result in the suspension of payments on a certain note required to be issued by the Authority to the Redeveloper pursuant to the terms of the Contract, said covenants, conditions and restrictions being set forth in the Contract; and WHEREAS, the Redeveloper has performed said covenants, conditions and restrictions insofar as it is able and in a manner deemed sufficient by the Authority to permit the execution and recording of this certification; NOW, THEREFORE, this is to certify that all building construction and other physical improvements specified to be done and made by the Redeveloper have been completed and performed by the Redeveloper as they apply to the land described in this certification, and the County Recorder and/or the Registrar of Titles in and for the County of Hennepin, State of Minnesota is/are hereby authorized to accept for recording and to record this insmament, and the filing of this instrument shall be a conclusive determination of the satisfactory termination of the covenants, conditions and restrictions in the Contract and relating to the construction of the "Navarre Expansion" (as that term is defined in the Contract); provided that it is hereby declared and agreed by the Authority and the Redeveloper that any covenants, conditions and restrictions relating to the insurance, taxes, maintenance, repair and reconstruction of the Navarre Expansion shall remain in full force and effect until the termination of the Contract. [The Remainder of This Page is Intentionally Left Blank] 51 Dated: ,20 NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY By Its Chairman And by Its Executive Director STATE OF MINNESOTA ) ) ss COUNTY OF ) On this ~ day of ,20._ before me, a Notary Public, personally appeared and , to me personally known and who by me duly sworn did say that they are the Chairman and Executive Director, respectively of the New Hope Development Authority, and acknowledged the foregoing instrument on behalf of said Authority. Notary Public 52 SCHEDULE G PUBLIC IMPROVEMENTS Removal or Relocation of Sewer, Water, Gas, Electric or Other Public Utilities Street Work, including curb and gutter SITE IMPROVEMENTS Geotechnical/Soils Testing Grading and Soils Correction, including the import and export of soils Environmental Testing Pollution Abatement/Environmental Remediation Demolition of Improvements Removal of Trees and Demolition Debris Any Other Site Preparation Necessary for Construction of the Minimum Improvements ACQUISTION COSTS Survey Work Title Work Platting/Subdividing ADDITIONAL ELIGIBLF~ EXPENSE~q Reasonable Legal Expenses and Professional Services Expenses Related to Any Above-Listed Public Improvement, Site Improvement or Acquisition Cost 53 SCH'EDULE H FORM OF NOTE Dated: ,20 $ UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY LIMITED REVENUE TAX INCREMENT NOTE The New Hope Economic Development Authority (the "Authority"), hereby acknowledges itself to be indebted and, for value received, promises to pay to the order of , a Minnesota (the "Registered Owner"), or its registered assigns, solely from the source, to the extent and in the manner hereinafter provided, the principal amount of this Note, being [insert amount not to exceed $450,000.00] and No/100 Dollars ($ ) (the "Principal Amount"), together with interest thereon from [insert date of Navarre Expansion Certificate of Completion] at a rate of seven percent (7%) per annum on the dates (the "Scheduled Payment Dates") described below and in the amounts (the "Scheduled Payments") described below. Scheduled Payments Dates shall be February l't and August l't of each year commencing August 1, 2004, and continuing until February 1, 20.__. Upon 30 days' prior written notice from the Authority to the Registered Owner, the Principal Amount is subject to prepayment at the option of the Authority in whole or in part, without penalty, at any time. Each payment on this Note is payable in any coin or currency of the United States of America which on the date of such payment is legal tender for public and private debts and shall be made by check or draft made payable to the Registered Owner and mailed to the Registered Owner at its postal address within the United States which shall be designated from time to time by the Registered Owner. This Note is a special and limited obligation and not a general obligation which been issued by the Authority pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Section 469.178, Subdivision 4, to aid in financing a "project", as therein defined, of the Authority consisting generally of defraying 54 certain public redevelopment costs incurred and to be incurred by or on behalf of the Authority within and for the benefit of its Redevelopment Project No. 1 (the "Project Area"). THIS NOTE IS NOT A GENERAL OBLIGATION OF THE AUTHORITY OR THE CITY OF NEW HOPE, MINNESOTA (THE "CITY") OR THE STATE OF MINNESOTA (THE "STATE"), AND NEITHER THE CITY, THE AUTHORITY, THE STATE NOR ANY POLITICAL SUBDIVISION OF ANY OF THESE ENTITIES SHALL BE LIABLE ON THIS NOTE, NOR SHALL THIS NOTE BE PAYABLE OUT OF ANY FUNDS OR PROPERTIES OTHER THAN AVAILABLE TAX INCREMENT, AS DEFINED BELOW. A Scheduled Payment on this Revenue Note due on any Scheduled Payment Date is payable solely from and only to the extent that the Authority shall have received, as of such Scheduled Payment Date, "Available Tax Increment" which is defined in the Conlract for Private Redevelopment between the Authority and the Registered Owner (the "Agreement") as tax increment received by the Authority as of a Scheduled Payment Date and with respect to the Redevelopment Project, including improvements thereto, as defined in the Agreement and as described Exhibit 1 attached to and made a part hereof, which non-contiguous real property is located within the Authority's Tax Increment Financing District No. 02-1. The Authority shall pay the Available Tax Increment to the Registered Owner on each Scheduled Payment Date. On February 1, 20 , the maturity date of this Note, any unpaid portion shall be deemed to have been paid in full. This Note shall not be payable from or constitute a charge upon any funds of the Authority, and the Authority shall not be subject to any liability hereon or be deemed to have obligated itself to pay hereon from any funds except the Available Tax Increment, and then only to the extent and in the manner herein specified. The Authority makes no representations or covenants, express or implied, that the revenues described herein will be sufficient to pay, in whole or in part, the mounts which are or may otherwise become due and payable hereunder. The Authority's payment obligations hereunder shall be further conditioned on the fact that there shall not at the time of payment have occurred and be continuing an "Event of Default", as defined in the Agreement, and, further, if pursuant to the occurrence of an Event of Default the Authority elects to terminate the Agreement, then the Authority shall have no further debt or obligation under this Note whatsoever. Reference is hereby made to the provisions of the Agreement for a fuller statement of the obligations of the Redeveloper and of the rights of the Authority thereunder, and said provisions of the Agreement are hereby incorporated by reference into this Note to the same extent as if they were set out in full herein. The execution and delivery of this Note by the Authority, and the acceptance thereof by the Redeveloper, as the 55 initial Registered Owner hereof, shall conclusively establish this Note as the "Note" required from the Authority under the Agreement. The Registered Owner shall never have or be deemed to have the right to compel any exercise of any taxing power of the Authority, or of any other public body, and neither the Authority nor any director, commissioner, council member, board member, officer, employee or agent of the Authority, nor any person executing or registering this Note, shall be liable personally hereon by reason of the issuance or registration hereof or otherwise. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to have happened, and to be performed precedent to and in the issuance of this Note have been done, have happened, and have been performed in regular and due form, time, and manner as required by law. This Note may be assigned, but upon such assigm'nent the assignor shall promptly notify the Executive Director of the Authority at the offices of the Authority, by registered mail, and the assignee shall surrender this Note to the Authority either: (i) in exchange for a new fully registered note or (ii) for transfer of this Note on the registration records for the Note then maintained by the Authority. Each such assignee shall take this Note subject to the foregoing condition and also subject to all provisions stated or referenced herein. The Authority has elected to issue this Note as a non-tax exempt obligation and accordingly does not anticipate that the interest on this Note is or will be generally exempt from federal or state income taxes, and the Authority makes no representation or covenant with respect to any such exemption. IN WITNESS WHEREOF, the Authority has caused this Note to be executed by the manual signatures of its Chairman and Executive Director and has caused this Note to be dated ,20 Chairman This instrument was drafted by: Krass Monroe, P.A. Suite 1100 Southpoint Office Center 1650 West 82"a Street Bloomington, Minnesota 55431 (952) 885-5999 Executive Director 56 CERTIFICATE OF REGISTRATION It is hereby certified that the foregoing Note, as originally issued on ,20 , was on said date registered in the name of , a Minnesota , and that, at the request of said Registered Owner of this Note, the undersigned has this day registered this Note as to principal and interest on the Note in the name of such Registered Owner, as indicated in the registration blank below, on the books kept by the undersigned for such purposes. Name of Registered Owner Date of Registration Signature of Executive Director ,20 57 EXHIBIT 1 TO NOTE REDEVELOPMENT PROJECT LEGAL DESCRIPTION [Descriptions of Expansion Site and Ahrens Relocation Site to be Inserted] 58 SCHEDULE I BUSINESS SUBSIDY AGREEMENT THIS BUSINESS SUBSIDY AGREEMENT (the "Agreement") is entered into this day of ,2002, by and between the New Hope Economic Development Authority, a public body corporate and politic (the "Authority") and Navarre Corporation, a Minnesota corporation, or its permitted successors or assigns (the "Redeveloper"). RECITALS 1. Description of the Business Subsidy. The Redeveloper will construct "Minimum Improvements" on the "Redevelopment Property," which improvements and property are defined in the Contract for Private Redevelopment between the Authority and the Redeveloper, dated as of ,2002 (the "Redevelopment Contract") and which improvements and property are shown in Exhibit A attached to and made a part of this Agreement. The tax increments thereafter generated by the Minimum Improvements in the "Tax Increment District", which district is defined in the Redevelopment Contract and further is defined as an economic development district pursuant to Minnesota Statutes, Section 469.174, Subdivision 12, will be used to assist with the costs of the "Site Improvements", "Public Improvements" and "Acquisition Costs" incurred in connection with construction of an expansion area for the Redeveloper's business, all of which costs are defined in the Redevelopment Contract. The fair market value of the tax increment assistance is anticipated to be a minimum of Two Hundred Thousand and No/100 Dollars ($200,000.00) and a maximum of Four Hundred Fifty Thousand and No/100 Dollars ($450,000.00), plus interest at a rate of % for up to years (the "Business Subsidy"). .. 2. Statement of Public Purpose. The Authority hereby finds, determines and declares the following public purpose goals: [To be Inserted from the Authority's Business Subsidy Policy] 3. Statement of Need for Business Subsidy. The Authority recognizes that by providing the Business Subsidy to the Redeveloper, the Redeveloper will assist the Authority in achieving its public purpose goals as stated above. 4. Name and Address of Redeveloper's Parent Corporation. The Redeveloper's parent corporation is , whose principal place of business is 59 In consideration of the above premises and the covenants contained herein, the parties hereto agree as follows: AGREEMENT 1. Wage and Job Goals of the Proiect. As a condition to the receipt of the Business Subsidy from the Authority on the terms and conditions as set forth in the Redevelopment Contract, the Redeveloper hereby agrees that it will meet the following wage and job goals within five (5) years after the earlier of: (i) completion of the Minimum Improvements for the entire Project (which project is defined in the Redevelopment Contract), or (ii) the date a business occupies any portion of the Redevelopment Property (in either case, the "Benefit Date"): (a) Within two (2) years after the Benefit Date, the Redeveloper estimates the creation of~ full-time employment opportunities. The wage for each full-time employment opportunity will be at least equal to ~% of the federal minimum wage per hour in effect as of the date of this Agreement. (b) Within five (5) years after the Benefit Date, the Redeveloper estimates the creation ora total of full-time employment opportunities. The wage for each full-time employment opportunity will be at least equal to ~ % of the federal minimum wage per hour in effect as of the date of this Agreement. The above-outlined goals shall collectively be referred to herein as the "Wage and Job Goals." 2. Repayment of Business Subsidy. (a) As security for the Redeveloper's compliance with the Wage and Job Goals, the Redeveloper hereby agrees that in the event the Redeveloper does not comply with the Wage and Job Goals it shall be obligated to repay and hereby agrees to repay to the Authority the full amount paid to the Redeveloper (or any successors or assigns) under the Note, plus interest per annum and calculated from the Benefit Date, at a rate equal to the greater of: (i) six percent (6%) or (ii) the implicit price deflator for government consumption expenditures and gross investment for state and local governments prepared by the Bureau of Economic Analysis of the United States Department of Commerce for the 12-month period ending March 31 of the previous year. Such repayment shall be due and payable immediately upon notice from the Authority to the Redeveloper of the Redeveloper's failure to meet the Wage and Job Goals within the time required by this Agreement (as extended under Subsection 2(b) of this Agreement, if applicable). 6o (b) The Redeveloper may, in the event that after execution of this Agreement the Redeveloper determines that it will not be able to meet the Wage and Job Goals within the time specified in Section 1 of this Agreement, request an extension of that deadline for up to one (1) additional year. If the Authority, in its sole discretion and after a public hearing as required by law, grants such an extension then the repayment of the Business Subsidy shall be deferred for the agreed-upon period (which period shall not exceed one year). (c) If the Redeveloper only partially meets the Wage and Job Goals by the deadlines imposed by Section 1 of this Agreement and, if applicable, as extended by this Section 2, then the Redeveloper's obligation to repay the Business Subsidy will be forgiven on a pro rata basis, measured by the number of employees actually hired against the Wage and Job Goals. 3. Reporting Requirements. (a) Annually by March 1st, commencing no later than the March 1 immediately following the Benefit Date and continuing until the applicable report evidences satisfaction of the Wage and Job Goals or for two (2) years, whichever is later, the Redeveloper will furnish to the Authority a "Minnesota Business Assistance Form" covering the preceding twelve (12) months, certified, by the appropriate officer of the Redeveloper, to be accurate. (b) If the Redeveloper does not file a report by the due date set forth in Subsection 3(a) above, the Authority will mail a warning to the Redeveloper within one (1) week of the filing date. If the Redeveloper thereafter does not file the report within fourteen (14) days after the postmarked date of the warning, the Redeveloper must pay the Authority a penalty of $100 for each subsequent day until the report is filed. The maximum penalty imposed by the Authority shall be within the then-applicable statutory limit, if any. The parties acknowledge that the current statutory limit is $1,000. 4. Five Year Commitment. (a) The Redeveloper acknowledges that it has received a Business Subsidy in connection with the Minimum Improvements and, in consideration thereof, hereby agrees to conduct, within the City of New Hope (the "City"), the operations stated in the Redevelopment Contract for at least five (5) years after the Benefit Date, unless the consent of the Authority to a move from the City and/or the County is first obtained, which consent, subject to the provisions of subparagraph (b) below, shall not be unreasonably withheld or delayed. 61 (b) If during the five (5) year period referred to in Subparagraph 4(a) above the Redeveloper decides to move its operations from the Redevelopment Property to another location outside the.jurisdiction of the City, the Redeveloper must first notify the Authority and include in the notification the specific business reasons for such decision. Following receipt of such notice, the Authority will promptly schedule and conduct a public hearing as required by law. (c) Notwithstanding any other language in this Agreement, the Redeveloper shall have no obligation to ensure the operation of a business on the "Ahrens Relocation Site", as that land is defined in the Redevelopment Contract. 5. Indemnity. The Redeveloper hereby agrees to pay and indemnify the Authority for and hold the Authority harmless from any and all costs, expenses and fees, including reasonable attomey's fees which may be incurred by the Authority in enforcing this Agreement, provided the Authority is the prevailing party. 6. Successors and Assigns. This Agreement and all terms, conditions and obligations contained herein shall nm with the "Expansion Site", as that property is defined in the Redevelopment Contract, and shall be binding upon and inure to the benefit of the Authority, the Redeveloper and their respective successors assigns. 7. Specific Performance. The parties hereto agree that in the event of a default by the Redeveloper in the performance of the obligations set forth in Section 4 of this Agreement, money damages shall not provide an adequate remedy. As a result, the parties understand and agree that, in the event of a default by the Redeveloper in the performance of its obligations under Section 4, the Authority shall be entitled to seek specific performance by the Redeveloper of such agreement. 8. Term. The term of this Agreement shall be from the day and year first above written until the date on which all of the requirements of this Agreement have been satisfied. This Agreement shall specifically survive the termination of the Redevelopment Contract. 9. Counterparts. This Agreement may be signed in one or more counterparts, each of which shall be binding upon a party when signed by that party and all of which when taken together shall constitute a single instrument. 10. Additional Governmental Financial Assistance The Redeveloper represents and wan'ants that, other than the Business Subsidy from the Authority, it has not been awarded financial assistance for the "Project" (as that term is defined in the Redevelopment Contract) by 62 any other state or local government agency with authority to grant a business subsidy, except as follows: 11. Miscellaneous. Any titles of the several parts, articles, and sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of the provisions of this Agreement. Time is of the essence with respect to each provision of this Agreement. Any notices or demands under this Agreement shall be delivered in the same manner as required by the Redevelopment Contract. The liability of individual members, officials, agents, servants and employees of the Authority and the City under this Agreement shall be as governed by the Redevelopment Contract. Capitalized terms not defined herein shall be ascribed the meaning as set forth in the Redevelopment Contract. IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf by its duly authorized representatives, and the Redeveloper has caused this Agreement to be duly executed in its name and behalf by its duly authorized representative, each on or as of the date as first above written and each intending to be bound thereby. 63 NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY By Its President By Its Executive Director Date: STATE OF MINNESOTA ) )ss COUNTY OF ) On this ~ day of ,2002, before me, a Notary Public, personally appeared and , to me personally known and who by me duly sworn did say that they are the President and Executive Director, respectively, of the New Hope Economic Development Authority and acknowledged the foregoing instrument on behalf of said Authority. Notary Public Authority Signature Page - Business Subsidy Agreement NAVARRE CORPORATION, a Minnesota corporation By Its And By Its Date: STATE OF MINNESOTA ) ) ss COUNTY OF ) On this day of , 2002, before me, a Notary Public, personally appeared and , to me personally known and who by me duly sworn did say that they are and .. , respectively of Navarre Corporation, a Minnesota corporation, and acknowledged th~' foregoing instrument on behalf of said corporation. Notary Public Redeveloper Signature Page - Business Subsidies Agreement 65 SCHEDULEJ USE CERTIFICATE [To Be Provided by Authority - criteria will include a pledge that on the Ahrens Relocation Site or the Expansion site, as applicable, no more than 15% of the buildings on the site will initially be used for purposes other than: (1) the manufacturing or production of tangible personal property, including processing resulting in the change in condition of the property; (2) warehousing, storage, and distribution of tangible personal property, excluding retail sales; (3) research and development related to the activities listed in clause (1) or (2); (4) telemarketing if that activity is the exclusive use of the property; (5) tourism facilities; (6) qualified border retail facilities; or (7) space necessary for and related to the activities listed in clauses (1) to (6)] 66 SCHEDULE K REDEVELOPER SECURIUTY [Form of Note and Mortgage To Be Provided] G:\WPDATA'~'q~4EW HOPE~O8'OOC'"~EDEVELOPMENT CONTRACT 8-29-02 - CLEAN.DOC 67 EDA O REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section Community Development ~'~ 9-09-02 EDA , Item No. By: Kirk McDonald By:,, 6 / A RESOLUTION AUTHORIZING A LA~D PURCHASE FROM THE CITY OF NEW HOPE AND THE EXECUTION OF A NOTE ESTABLISHING TERMS FOR PAYMENT REQUESTED ACTION Staff recommends that the EDA approve the enclosed resolution. POLICY/PAST PRACTICE The EDA has approved similar agreements in the past to promote redevelopment projects. BACKGROUND The resolution states that: · The EDA has authorized execution of a Contract for Private Redevelopment by and between the EDA and Navarre Corporation dated as of September 9, 2002 (the "Contract"), which provides, among other things, for the redevelopment of that real property known as 9200 49~h Avenue North and legally described on Exhibit A attached hereto (the "Property"), which is currently owned by the City of New Hope, Minnesota (the "City"). · The Contract contemplates redevelopment of the Property to include a trucking and warehouse facility. · The City is willing to sell the Property to the EDA for the purposes contemplated in the Contract and the EDA is willing to purchase the Property from the City for such purposes. The resolution makes the following findings: · The Authority hereby finds that purchase of the Property by way of a limited revenue note, in substantially the form attached hereto as Exhibit B (the "Note") is a reasonable and cost efficient alternative to issuing bonds or expending other EDA funds to facilitate the redevelopment contemplated by the Contract. · The Authority hereby finds that the terms and limitations of the Note are reasonable. The resolution grants the following authorizations: · The Authodt7 hereby authorizes the execution and delivery of the Note. MOTION · o: o -o7 Request for Action Page 2 9-09-02 · The Authority hereby authorizes payments to be made on the Note in accordance with the terms and limitations outlined therein. Staff recommends approval of the resolution. ATTACHMENTS · Resolution NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY COUNTY OF HENNEPIN STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION AUTHORIZING A LAND PURCHASE FROM THE CITY OF NEW HOPE AND THE EXECUTION OF A NOTE ESTABLISHING TERMS FOR PAYMENT. BE IT RESOLVED by the Board of Commissioners (the "Board") of the New Hope Economic Development Authority (the "EDA") as follows: Section 1. Recitals. 1.01 The EDA has authorized execution of a Contract for Private Redevelopment by and between the EDA and Navarre Corporation dated as of September 9, 2002 (the "Contract"), which provides, among other things, for the redevelopment of that real property known as 9200 - 49t~ Avenue North and legally described on Exhibit A attached hereto (the "Property"), which is currently owned by the City of New Hope, Minnesota (the "City"). 1.02 The Contract contemplates redevelopment of the Property to include a trucking and warehouse facility. 1.03 The City is willing to sell the Property to the EDA for the purposes contemplated in the Contract and the EDA is willing to purchase the Property from the City for such purposes. Section 2. Findin,qs. 2.01 The Authority hereby finds that purchase of the Property by way of a limited revenue note, in substantially the form attached hereto as Exhibit B (the "Note") is a reasonable and cost efficient alternative to issuing bonds or expending other EDA funds to facilitate the redevelopment contemplated by the Contract. 2.02 are reasonable. The Authority hereby finds that the terms and limitations of the Note Note. Section 3. 3.01 Authorizations. The Authority hereby authorizes the execution and delivery of the 3.02 The Authority hereby authorizes payments to be made on the Note in accordance with the terms and limitations outlined therein. Adopted by the Board of the EDA this __ day of September, 2002. ATTEST: President Executive Director CERTIFICATION I, , Executive Director of the New Hope Economic Development Authority, County of Hennepin, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. adopted by the EDA on the day of ,2002. Executive Director G:~WPDATA~I~IE~N HOPE~08~DOC~EDA RESOLUTION AUTHORIZING LAND ACQ AND NOTE.DOC EXHIBIT A LEGAL DESCRIPTION OF PROPERTY LOCATED IN HENNEPIN COUNTY, MINNESOTA G:\WPDATA\N\NEW HOPE\08\DOC\EDA RESOLUTION AUTHORIZING LAND ACQ ;tND NOTE.DOC EXHIBIT B FORM OF REVENUE NOTE G:\WPDATA\N\NEW HOPE\08\DOC\EDA RESOLUTION AUTHORIZING LAND ACQ AND NOTE.DOC EDA REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section Community Development 9-09-02 EDA Item No. By: Kirk McDonald By: 7 A RESOLUTION AUTHORIZING A SALF~AND CONVEYANCE OF LAND TO NAVARRE CORPORATION, OR ITS PERMITTED SUCCESSOR OR ASSIGNS, IN ACCORDANCE WITH THE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY'S TERMS AND CONDITIONS OF SALE REQUESTED ACTION Staff recommends that the EDA approve the enclosed resolution. POLICY/PAST PRACTICE The EDA has approved similar resolutions in the past regarding the conveyance of property. BACKGROUND The resolution states that: · It has been proposed that the EDA execute a Quit Claim Deed (the "Deed") in accordance with the Terms and Conditions of Sale attached to this Resolution as Exhibit A (the "Terms and conditions of Sale") conveying property to Navarre Corporation, a Minnesota Corporation, or its permitted successor or assigns (the "Purchaser") as allowed under the Contract for Private Redevelopment by and between the EDA and Navarre Corporation dated as of September 9, 2002. The resolution makes the following findings: · The Board hereby finds that the sale and conveyance are advisable, that they are in the best interests of the City of New Hope and its people, and that the sale promotes the Board's aims and purposes pursuant to Minnesota Statutes. · The Board finds that the sale and conveyance further its general plan of economic development and promotes the objectives outlined in its Restated Redevelopment Plan for Redevelopment Project No. 1 pursuant to Minnesota Statutes. / Request for Action Page 2 9-09-02 The resolution provides the following authorizations: · The Executive Director shall immediately file this Resolution with the records of the EDA. · The President and Executive Director are hereby authorized to execute and deliver the Deed and to take all necessary actions to effect a transfer of the title. Staff recommends approval of the resolution. ATTACHMENTS · Resolution NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY COUNTY OF HENNEPIN STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION AUTHORIZING A SALE AND CONVEYANCE OF LAND TO NAVARRE CORPORATION, OR ITS PERMITTED SUCCESSORS OR ASSIGNS, IN ACCORDANCE WITH THE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY'S TERMS AND CONDITIONS OF SALE. BE IT RESOLVED by the Board of Commissioners (the "Board") of the New Hope Economic Development Authority (the "EDA"), as follows: Section 1. Recitals. 1.01 It has been proposed that the EDA execute a Quit Claim Deed (the "Deed") in accordance with the Terms and Conditions of Sale attached to this Resolution as Exhibit A (the "Terms and Conditions of Sale") conveying property to Navarre Corporation, a Minnesota Corporation, or its permitted successors or assigns (the "Purchaser") as allowed under the Contract for Private Redevelopment by and between the EDA and Navarre Corporation dated as of September 9, 2002. Section 2. Findin,qs. 2.01 The Board hereby finds that the sale and conveyance are advisable, that they are in the best interests of the City of New Hope and its people, and that the sale promotes the Board's aims and purposes pursuant to Minnesota Statutes, Sections 469.090 to 469.1082 (the Economic Development Authority Act). 2.02 The Board finds that the sale and conveyance furthers its general plan of economic development and promotes the objectives outlined in its Restated Redevelopment Plan for Redevelopment Project No. 1 pursuant to Minnesota Statutes, Sections 469.001 et seq. Section 3. Authorization for Sale and Conveyance. 3.01 The Executive Director shall immediately file this Resolution with the records of the EDA. 3.02 The President and Executive Director are hereby authorized to execute and deliver the Deed and to take all necessary actions to effect a transfer of the title from the EDA to the Purchaser when the Purchaser has complied with the land transfer requirements included in the Terms and Conditions of Sale. Adopted by the Board of the EDA this __ day of September, 2002. President ATTEST: Executive Director CERTIFICATION I, , Executive Director of the New Hope Economic Development Authority, County of Hennepin, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. adopted by the EDA on the day of ,2002. Executive Director EXHIBIT a NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY TERMS AND CONDITIONS OF SALE See the provisions contained in the Contract For Private Redevelopment by and between the New Hope Economic Development Authority and Navarre Corporation dated as of September 9, 2002. G:\WPDATA~I~IEW HOPE~08~DOC~EDA RESOLUTION AUTHORIZING LAND SALE TO NAVARRE.DOC EDA REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section Community Development ~ 9-9-02 EDA Item No. By: Ken Doresky, Community Development Specialist By: 8 / RESOLUTION APPROVING LETTER OF (AGREEMENT BETWEEN THE BROOKLYN PARK ECONOMIC DEVELOPMENT AUTHORITY AND THE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY FOR THE SECOND SUBURBAN REMODELING PLANBOOK PROJECT, SPLIT-LEVELS AND SPLIT-ENTRYS AT A COST OF $5,000 (IMPROVEMENT PROJECT NO. 623) ACTION REQUESTED Staff is requesting Council consideration of a resolution approving a letter of agreement between the Brooklyn Park Economic Development Authority and the New Hope Economic Development Authority for the second suburban remodeling planbook project, split-levels and split-entrys at a cost of $5,000. POLICY/PAST PRACTICE City goal//2 is to pursue the maintenance and redevelopment of commercial and residential properties within the City. The City Council has been addressing the residential portion of this goal through the City's many housing activities, including participation in the previous planbook completed for cape cods and ramblers and commitment to this second remodeling planbook project. BACKGROUND On April 8, 2002, the EDA passed a motion authorizing participation in the second suburban remodeling ~lanbook project, split-levels and split-entrys. The EDA allocated a maximum of $6,250 for this project ($75,000 divided among the twelve participating jurisdictions) with the understanding that if additional jurisdictions participate, the cost will be adjusted accordingly. Since that time, Columbia Heights has agreed to participate in the project with a $5,000 contribution, increasing the total amount raised to $73,000. Brooklyn Park is coordinating the contract with the architecture firm. On April 8, Staff informed the EDA that the attached Letter of Agreement between the City of Brooklyn Park and the City of New Hope outlining the responsibilities of each jurisdiction would be forthcoming. Per the consortium and attached Letter of Agreement, the Brooklyn Park EDA is requesting $5,000 from the New Hope EDA for the project. The Contract and Letter of Agreement are identical to the one utilized when the last consortium of cities developed the Cape Cod and Rambler Planbook and have only been updated to reflect the Brooklyn Park EDA as the contract holder. The purpose of the contract with the Architect is to produce the content of the Planbook and that the iudsdictions will then need to raise the funds for publishin~l. The Contract amount is MOTION BY ~ SECOND BY Request for Action Page 2 9-9-02 $75,000 and the funds will be deposited with the Brooklyn Park EDA, who will then execute the Contract with the Architect and will pay on the Contract from those funds. If there are any remaining funds, the Brooklyn Park EDA will utilize those funds to offset the costs associated with printing the planbooks. The Letter of Agreement contains the following items: The Brooklyn Park EDA agrees to execute a contract with Robert Gerloff Residential Architects in the amount of $75,000 for the preparation of a remodeling planbook for housing in fully developed and/or inner-ring cities of the Twin Cities Metropolitan Area. The City agrees to pay $5,000 to the Brooklyn Park EDA as its share of the cost to be incurred by the Brooklyn Park EDA for the services of the Architect in preparing the remodeling planbook as described in the Professional Services Agreement. As a condition of the contractor's responsibility to perform under this Agreement, the Brooklyn Park EDA must procure the participation of at least fifteen communities and/or counties. If this condition is not satisfied, the contractor is excused from performing under the contract. It is the Brooklyn Park EDA's intent that the architect produce drawings and other material, which can be used in preparing the remodeling planbook. Notwithstanding anything herein to the contrary, the Brooklyn Park EDA agrees to provide the City with as least a computer disc containing the remodeling planbook drawings and other materials. The Brooklyn Park EDA acknowledges that it has sole responsibility for paying all amounts due to the Architects for preparation of the remodeling planbook. The Brooklyn Park EDA agrees that if, after paying the Architect fees, insufficient funds remain for publishing and printing the remodeling planbook, the Brooklyn Park EDA will provide the City with a copy of the computer disc produced by the Architects with the remodeling planbook on the disc. Except for an breach of the representations of the EDA, any willful misrepresentation of any willful or wanton misconduct of the EDA, or the negligence or other wrongful act or omission of any officers, agents and employees of the EDA. The City of New Hope agrees to indemnify and hold harmless the Brooklyn Park EDA and its officers, agents and employees against any claim, demand, suit, action or other proceeding arising pursuant to this Agreement resulting from actions or failures to act by the EDA or its governing body members, officer, agents or employees, provided that the foregoing indemnification shall not be effective for any actions of the EDA that are not contemplated by the Agreement. The Brooklyn Park EDA agrees that the $5,000 paid by the City of New Hope pursuant to the Agreement will be used solely for the purpose of producing a remodeling planbook as described in this Agreement. The Brooklyn Park EDA further agrees to refund any portion collected under this Agreement of a pro-rata basis among the participating entities. In 1997, the EDA authorized city participation in the initial suburban remodeling planbook project, "Cape Cods & Ramblers: A Remodeling Planbook for Post-WWII Houses." The planbook was produced through a collaborative effort of fifteen metropolitan area jurisdictions, including New Hope and architect Robert Gerloff. The planbook initiative was undertaken as an additional tool for the encouragement of residents to remodel and expand their homes. The planbook is available at City Hall and several residents have utilized it in their remodeling projects. The initial planbook received the National League of Cities 1999 Innovation Award, "Building a Nation of Communities" awarded at the Congress of Cities conference in Los Angeles, California, and was highlighted in Nation's Cities Weekly. Also, the planbook won the Minneapolis Hedtage Preservation Commission Award, MN Chapter of the American Planning Association Public Education Award, National League of Cities "Investing in Community Award" and the MN AIA "Special Award." The planbook was featured in the Minneapolis Star Tdbune and Twin Cities edition of the Broker Agent Magazine, Americas Trade Publication Request for Action Page 3 9-9-02 for the Real Estate Professional. In addition, the planbook is currently available for purchase through American Planning Association's bookstore. Due to the success of the previous planbook, staff from thirteen jurisdictions, including Brooklyn Park, Bumsville, Coon Rapids, Golden Valley, Maplewood, Minnetonka, Mounds View, Plymouth, Roseville, Columbia Heights, Dakota County CDA, Washington County HRA and New Hope have started to work together on this second planbook focusing on split-level and split-entry houses. New Hope has an abundance of this type of housing. Although several residents took advantage of the previous planbook to remodel and expand cape cods and ramblers, staff feels that this second planbook focusing on splits will be even more successful. The City of Brooklyn Park sent out a request for qualifications for the project to several architecture firms and only Robert Gerloff Residential Architects submitted a proposal. Robert Gerloff Residential Architects is the same firm that completed the original planbook. The firm has submitted a bid of $75,000 to complete the planbook (Please see the attached Profession Services Agreement). The agreement is to include the following: · Compact Disc with the remodeling planbook fully designed and printer ready; · High quality scans to each City for web pages and reference; · 10 water color images, and; · Over 900 total hours at between $60 and $100 per hour. Staff recommends approval of this resolution. FUNDING $5,000 is the amount requested for the project. There are funds available in the 2002 EDA budget for this project. As in the last planbook project, additional contributions will be sought from outside organizations to facilitate printing. ATTACHMENTS · Resolution · Letter of Understanding · Invoice · Brooklyn Park Correspondence · Professional Services Agreement CITY OF NEW HOPE RESOLUTION NO. 2002- RESOLUTION APPROVING LETTER OF AGREEMENT BETWEEN THE BROOKLYN PARK ECONOMIC DEVELOPMENT AUTHORITY AND THE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY FOR THE SECOND SUBURBAN REMODELING PLANBOOK PROJECT, SPLIT-LEVELS AND SPLIT-ENTRYS AT A COST OF $5,000 (IMPROVEMENT PROJECT NO. 623) WHEREAS, WHEREAS, WHEREAS, WHEREAS, WHEREAS, the City of New Hope desires to participate with other suburban cities in the preparation of a remodeling planbook to encourage homeowners to expand and remodel their homes; and, on February 9, 2002, the EDA approved Resolution 98-01 approving a Letter of Understanding with the Fridley Housing and Redevelopment Authority for the initial suburban remodeling planbook project; and, on April 8, 2002, the EDA passed a motion authorizing participation in the second suburban remodeling planbook project focusing on split-level and split- entry homes, and; the Brooklyn Park EDA, on behalf of the participating cities, have agreed to enter into a contract with an architect to produce the content of the remodeling planbook and to disburse expenses for the project; and; a Letter of Agreement has been prepared outlining each participating cities' understanding of the use of the $5,000 per city contribution for the project and acknowledges that the Brooklyn Park EDA is administering the contract on behalf of the cities. NOW, THEREFORE, BE IT RESOLVED, that the Letter of Agreement with the Brooklyn Park EDA is hereby approved. Adopted by the Economic Development Authority in and for the City of New Hope, Hennepin County, Minnesota, this 9th day of August, 2002. President Attest: Executive Director AGREEMENT This Agreement is made between the Brooklyn Park Economic Development Authoritv (hereinafter, the "EDA") and the (hereinafter, the .... ) on this __ day of 2002. The EDA agrees to execute a contract with Robert Gerloff Residential Architects in the amount of $75,000 for the preparation of a remodeling plan book for housing in fully developed and/or inner ring cities of the Twin Cities Metropolitan Area. agrees to pay $ to the EDA as its share of the costs to be incurred by the EDA for the services of the Architect in preparing the remodeling plan book as described in the attached Professional Service Agreement. As a condition to the 's responsibility to perform under this Agreement, the EDA must procure the participation of at least fifteen other communities and/or counties. If this condition is not satisfied, is excused fi.om performing under the contract. It is the EDA's intent that the Architect produce drawings and other material, which can be used in preparing the remodeling, plan book. If sufficient funds are available, the EDA will work to publish the remodeling plan book. Notwithstanding anything herein to the contrary, the EDA agrees to provide with at least a computer disk containing the remodeling plan book drawings and other materials. The EDA acknowledges that it has sole responsibility for paying all amounts due to the Architects for preparation of the remodeling plan book. The EDA agrees that if, after paying the Architect fees, insufficient funds remain for publishing and printing the remodeling plan book, the EDA will provide with a copy of the computer disk produced by the Architects with the remodeling plan book on the disk. Except for any breach of the representations of the EDA, any willful misrepresentation of any willful or wanton misconduct of the EDA, or the negligence or other wrongful act or omission of any officers, agents and employees of the EDA. agrees to indemnify and hold harmless the EDA and its officers, agents, and employees against any claim, demand, suit, action, or other proceeding arising pursuant to this Agreement resulting from actions or failures to act by the EDA or its governing body members, officer, agents, or employees, provided that the foregoing indemnification shall not be effective for any actions of the EDA that are not contemplated by the Agreement. The EDA agrees that the $ paid by the pursuant to this Agreement will be used solely for the purpose of producing a remodeling plan book as described in this Agreement. The EDA further agrees to refund any unused portion collected under this Agreement of a pro-rata basis among the participating entities. IN WITNESS WHEREOF, the EDA and the have executed this Agreement by their duly authorized signatories on or as of the date first above written. BROOKLYN PARK ECONOMIC DEVELOPMENT AUTHORITY By ~~"/ ~~~ Its A.tssistantt~eeutive Director By Its 2 INVOICE BROOKLYN PARK ECONOMIC DEVELOPMENT AUTHORITY Attention: Marjorie Mangine 5200 85th Avenue North Brooklyn Park MN 55443 (763) 493-8054 DATE: August 20, 2002 TO: Mr. Ken Doresky Community Development Specialist City of New Hope 4401 Xylon Avenue North New Hope MN 55428 Development of Split Entry / Level Planbook ............................................................. $5,000.00 TOTAL $5,000.00 Amount Due Upon Receipt Please Make Checks Payable to the Brooklyn Park EDA Brookly!3 pakk Housing and Redevelopment Division 5200 85th Ave. N., Brooklyn Park, MN 55443-4300 ~ Phone 763-424-8000 ~ Fax 763-493-8391 TDD 763-493-$39£ Peter J. Waldock Director of Commumty Development Mr. Ken Doresky Community Development Specialist City of New Hope 4401 Xylon Avenue North New Hope MN 55428 July 29, 2002 RE: Split Entry/Level Planbook Dear Mr. Doresky: The Brooklyn Park Economic Development Authority (EDA), on behalf of several cities and counties, has agreed to enter into a contract with Robert GerloffResidential Architects to produce the content of the above referenced Planbook. Enclosed is an invoice for $5,000.00, a Letter of Understanding and a copy of the Contract between the Brooklyn Park EDA and Robert GerloffResidential Architects. The enclosed Contract and Letter of Agreement are identical to the one we utilized when the last consortium of cities developed the Cape Code and Rambler Planbook and have only been updated to reflect the Brooklyn Park EDA as the contract holder. The purpose of the Letter of Understanding is for each city and county to agree on certain terms with the Brooklyn Park EDA regarding the use of the $5,000.00. It should be noted that the purpose of the Contract with the Architect is to produce the content of the Planbook and that the cities/counties will then need to raise the funds for publishing it. The Contract amount is $75,000 and the funds will be deposited with the Brooklyn Park EDA, who will then execute the Conuact with the Architect and will pay on the Contract from those funds. Ifthereare any remaining funds, the Brooklyn Park EDA will utilize those funds to offset the costs associated with printing the Planbooks. Please process the invoice at your earliest convenience and mail the check and Letter of Agreement to: Brooklyn Park EDA Attention: Marjorie Mangine 5200 85ta Avenue North Brooklyn Park .MN 55443 Please contact me at 763-493-8089 if you have any questions. ~.....--. Stacie Kvilvang Project Manager cc: Scott Clark - Deputy D/rector of Commumty Development Marjorie Mangine - Hous/ng and Redevelopment Planner File www. brooklynpark.org PROFESSIONAL SERVICE AGREEMENT SPLIT ENTRY ! LEVEL PLANBOOK THIS AGREEMENT made and entered into by and between the Brooklyn Park Economic Development Authority in and for the City of Brooklyn Park, State of Minnesota, hereinafter referred to as the EDA and Robert Gerloff Residential Architects, hereinafter referred to as Architect. WITNESSETH: WHEREAS, several cities and counties have initiated a cooperative effort to produce a remodeling plan book; and WHEREAS, these cities and counties have requested the EDA to act as the contract holder for professional services on behalf of the cities and counties; and WHEREAS, the cities and counties have conducted a Request for Proposal to provide professional services to produce the content of the plan book; and WHEREAS, the cities and counties have mutually agreed to hire Architect;, and WHEREAS, the EDA agrees to purchase the services of Architect on behalf of several cities and counties; and WHEREAS, the cities have agreed to provide the funds for these services. NOW, THEREFORE, in consideration of the mutual undertakings agreements hereinafter set forth, the EDA and Architect agree as follows: 1. and TERMS AND COST OF THE AGREEMENT ............................................ . . . Architect agrees to furnish services to the EDA as indicated on the attached Exhibit A. The total cost of this Professional Service Agreement shall not exceed $75,000. Work beyond the Scope of Services in Exhibit A shall be approved in writing by the EDA. .. OWNERSHIP OF MATERIALS ...... All reports, memorandums and other data produced by the Architect becomes the property of the EDA with the following exceptions: Architect retains ownership of the original watercolors with the EDA having full use of the images provided by Architect through electronic scanning and photography. PAYMENT FOR SERVICES .................................................................. Architect will submit invoices at the same time benchmark tasks are completed and submitted to the EDA according to the benchmark schedule in Exhibit A. However, the first benchmark payment will be made by the EDA when the invoice is presented following agreement signing. The EDA will issue the check within 30 working days of receipt of invoice. PRODUCT ..... Architect will provide the EDA with compact disc with the remodeling plan book full designed in Quark printer ready. Architect will scan in all images. Assuming the product is published, the EDA will provide the Architect twenty-five (25) copies of remodeling plan book free of charge. The EDA makes no representations as to timing. INDEPENDENT CONTRACTOR ................................. Architect shall select the means, method and manner of performing the services herein in consultation with the EDA. Nothing is intended or should be construed in any manner as creating or establishing the relationship of co-partners between the EDA and Architect or as constituting Architect as the agent, representative or employee of the EDA for any purpose or in any manner whatsoever. Architect is to be and shall remain an independent contractor with respect to all services performed under this Agreement. Architect represents that it has or will secure at its own expense all personnel required in performing services under this Agreement. Any and all personnel of Architect or other persons while engaged in the performance of any work or services required by this Agreement shall have no contractual relationship with the EDA, and shall not be considered employees of the EDA. Any and all claims that may or might arise under the Unemployment Compensation Act or the Workers' Compensation Act of the State of Minnesota on behalf of said personnel, arising out of employment or alleged employment, including, without limitation, claims of discrimination against Architect, its officers, agents, contractors or employees shall in no way be the responsibility of the EDA. Architect shall defend, indemnify and hold the EDA, its officers, agents and employees harmless from any and all such claims irrespective of any determination of any pertinent tribunal, agency, board, commission or court. o Such personnel or other persons shall neither require nor be entitled to any compensation, rights or benefits of any kind whatsoever from the EDA, including, without limitation, tenure rights, medical and hospital care, sick and vacation leave, Workers' compensation, unemployment insurance, liability, severance pay and PERA. NON-DISCRIMINATION ......................................................................... The EDA operates in accordance with the City of Brooklyn Park's policies against discrimination. No person shall be excluded from or denied the benefits of any service performance or contemplated under the terms of this Agreement on the grounds of race, color, creed, religion, age, sex, disability, martial status, public assistance status, ex-offender status or national origin; and no person who is protected by applicable Federal or State laws against discrimination shall be otherwise subjected to discrimination. Architect shall: Furnish all information and reports which may be required by the EDA's Affirmative Action Policy; and bo Comply with the EDA's Equal Employment Opportunity/Affirmative Action Statement with regard to employment and contracting (see Exhibit B). INDEMNITY AND INSURANCE ... Architect agrees to defend, indemnify and hold the EDA, its officers and employees harmless from any liability claims, damages, costs, judgments or expenses, including reasonable attorney fees resulting directly or indirectly from an act or omission (including, without limitation, professional errors or omissions) of Architect, its agents, employees or assignees in performance of the services provided by this contract, and against all loss by reason of the failure of Architect to fully perform in any respect, all obligations under this contract. RECORDS - AVAILABILITY .... Architect agrees that the EDA, the State Auditor or any of their duly authorized representatives at any time during normal business hours, and as often as they may reasonably deem necessary, shall have access to and the right to examine, audit, excerpt and transcribe any books, documents, papers, records, etc., which are pertinent to the accounting practices and procedures of Architect and involve transactions relating to this Agreement. Records shall be retained for three years from date of final payment with .respect to the project. o 10. 11. 12. 13. Architect shall not assign, subcontract, transfer or pledge this contract and/or the services to be performed hereunder, whether in whole or in part, without the prior written consent of the EDA. MERGER AND MODIFICATION ................................................................ It is understood and agreed that the entire Agreement between the parties is contained herein and that Agreement supersedes all oral agreements and negotiations between parties relating to the subject matter hereof. All items referred to in this Agreement are incorporated or attached and are deemed to be part of this Agreement. bo Any material alterations, variations, modifications or waivers of provisions of this Agreement shall only be valid when they have been reduced to writing as an amendment to this Agreement signed by the parties hereto. DEFAULT AND CANCELLATION .............. If Architect fails to perform any of the provisions of this Agreement or so fail to administer the work as to endanger the performance of this Agreement, this shall constitute a default. Unless the default is excused, the EDA may, upon written notice, immediately cancel the Agreement in its entirety. The EDA's failure to insist upon strict performance of any provision or to exercise any right under this Agreement shall not be deemed a relinquishment or waiver of the same, unless consented to in writing. Such consent shall not constitute a general waiver or relinquishment throughout the entire term of the Agreement. If the Agreement is canceled, Architect will be paid for percent of work completed to the date of cancellation. CONTRACT ADMINISTRATION ........................................ The EDA is managing the Contract in consultation with several cities and counties as outlined in Exhibit C. From time to time, meetings shall be held between Architect, the EDA and the cities and counties identified in Exhibit C. MEDIATION/ARBITRATION CLAUSE . . ............... If a dispute arises out of or relates to this Agreement, or breaching of the Agreement, and if the dispute cannot be settled through direct discussions, the Architect and the EDA agree to first endeavor to settle the dispute in an amicable manner by mediation administered by the Mediation Center, Minneapolis MN, before resorting to arbitration. 4 14. If mediation is unsuccessful, the dispute shall be administered by the Mediation Center, Minneapolis MN. will each pay one-half the cost of mediation/arbitration. settled by arbitration Architect and the EDA NOTICES ............................................................................................. Any notice or demand, which must be given or made by a party hereto under the terms of this Agreement, shall be in writing. Notices shall be sent as follows: For: Brooklyn Park Economic Development Authority Attn: Marjorie Mangine 5200 85th Avenue North Brooklyn Park MN 55443 For: Robert Gerloff Residential Architects 4007 Sheridan Avenue South Minneapolis MN 55410 ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BROOKLYN PARK BY: . .~. ~.~,~/_~,//~/~ ~ ~,~"~ Presi~le~t ' x/' BY:Ass~~/~r'''~ ROBERT GERLOFF RESIDENTIAL ARCHITECTS Its Owner Exhibit A Scope of Services Jan to AugPrepare and submit qualifications to Consortium =reliminary interview with Consortium Outline and discuss the book structure Outline and discuss the final scope of the project Outline and negotiate the final project budget Negotiate and sign the contract :'irst payment of $25,000 due September Create the splitlevel.com web site discussion forum Historical research on the split level house type Historical Sources: Minnesota Historical Society Builder's Association of the Twin Cities archives Star Tribune and Pioneer Press archives Builders who are still in business Parade of Homes boo~ Planbooks and shelter press magazines from the era Find: historic photos to use in book and for promotion Historic drawings Survey split level types and variations in the communities Photograph the range of splits Identify the most common split plans October ,Jeremiah to give Xerox copies of images to Brian Brian to design cartoon of book Meet with Consortium to discuss book design Revise book design cartoon per Consortium feedback Design a postcard to announce the web site ~)istribute postcard through communities Write a press release about the project Compile a list of community newspapers Send press release to community newspapers On-going work to monitor web site and feedback Select a split to use as the model Set up ArchiCAD file format Build this house in the computer Finalize design projects with the committee Design and cartoon the book =repare the ~tst dra~ of design ideas Write the first draft of text 6 2O03 7~26/2002 Copy edit and proof first draft text Meet with Consortium to go over first draft of book Second payment of $25,000 due Revise the designs and text per Consortium feedback Copy edit and proof final draft text Revise the designs and text per Consortium feedback Prepare underlays for watercolors Create watercolor renderings (10 @ $750 each) Scan the watercolors ($1000 fixed cost) Prepare the final draft of the book Final sweep on copy editing and proof reading Meet with Consortium to discuss final draft Revise the design and text per Consortium feedback Submit the book to and coordinate with the Printer Color check Post .pdf format book pages on the web site Burn cd's of the watercolor images for all communities Color check Consortium to pay for printing and distribution Prepare a postcard announcement of book release :~repare a press release announcing the book release Celebrate the release of the book! Final payment of $25,000 due Clarifications: ~11 printing costs to be paid by Consortium This price does NOT include construction cost estimates The book celebration event is coordinated by the Consortium Robert Gerloff 200 hours @ $100/hour Jeremiah Battles 500 hours @ $60/hour Bryan Donahue 133.33 hours @ $75/hour Peter J. Musty 100 hours @ $75/hour Lynette Lamb 40 hours @ $75/hour Charrettecenter. com web design/set up costs ~veb page 24 months (~ $60/month and domain name 3igh-resolution scans or color separations Total Budget: $30,000 $10,00l; $7,50l~ $3,000 $2,000 $1,s00 $1,ooo $75,00C 7 Exhibit B EQUAL EMPLOYMENT OPPORTUNITY STATEMENT This is to affirm the City of Brooklyn Park's policy of providing equal opportunity to all employees and applicants for employment in accordance with all applicable Equal Employment Opportunity/Affirmative Action laws, directives and regulations of federal, state and local governing bodies or agencies thereof, specifically Minnesota Statute 363. The City of Brooklyn Park will not discriminate against or harass any employee or applicant for employment because of race, color, creed, religion, national origin, sex, disability, age, marital status, sexual orientation, or status with regard to public assistance. The City of Brooklyn Park will take Affirmative Action to ensure that all employment practices are free of such discrimination. Such employment practices include, but are not limited to, the following: hiring, upgrading, demotion, transfer, recruitment or recruitment advertising, selection, layoff, disciplinary action, termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The City of Brooklyn Park will use its best efforts to afford minority and female business enterprises with the maximum practicable opportunity to participate in the performance of subcontracts for construction projects that this city engages in. The City of Brooklyn Park will commit the necessary time and resources, both financial and human, to achieve the goals of Equal Employment Opportunity and Affirmative Action. The City of Brooklyn Park fully supports incorporation of non- discrimination and Affirmative Action rules and regulations into contracts. The City of Brooklyn Park will evaluate the performance of its management and supervisory personnel on the basis of their involvement in achieving these Affirmative Action objectives, as well as, other established criteria. Any employee of this city, or subcontractor to this city, who does not comply with the Equal Employment Opportunity policies and procedures as set forth in this Statement and Plan will be subject to disciplinary action. Any subcontractor not complying with all applicable Equal Employment Opportunity/Affirmative Action laws, directives, and regulations of the federal, state, and local governing bodies or agencies thereof, specifically Minnesota Statute 363, will be subject to appropriate legal sanctions. The City Manager, or his designee shall be responsible for the administration of the Equal Employment Opportunity program. His responsibilities will include monitoring all Equal Employment Opportunity activities and reporting the effectiveness of this Affirmative Action program as required by federal, state, and local agencies. The City Manager, or his designee will receive and review reports on the progress of the program. If any employee or applicant for employment believes he/she has been discriminated against, they should contact the Human Resources Director, 5200 85th Avenue North, Brooklyn Park, Minnesota 55443, or call (612) 493-8004. Exhibit C Participating Cities/Counties Brooklyn Park Burnsville Circle Pines Columbia Heights Coon Rapids Dakota County Golden Valley Hennepin County Maplewood Moundsview New Hope Plymouth Roseville Shoreview Washington County HRA