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IP #897IIIVIIv�IVIIII�IRInhRB Doc No A10092637 Certified, filed and/or recorded on Jul 1, 2014 2:00 PM Office of the County Recorder Hennepin County, Minnesota Martin McMormick, County Recorder Mark Chapin, County Auditor and Treasurer Deputy 84 Pkg ID 1125719C Doc Name: Development Agreement Document Recording Fee $46.00 Dow~ Total $46.00 This cover sheet is now a permanent part of the recorded document PURCHASE AND DEVELOPMENT AGREEMENT By and Between NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY and COMPASS POINTE LIMITED PARTNERSHIP Dated as of: 2014 This document was drafted by: BRADLEY & DEIKE, P. A. 4018 West 65" Street, Suite 100 Edina., MN 55435 Telephone: (952) 926-5337 #',,, �z rcial par{ners Title, LLC Ca0myne200 South Sixth Street Suite 3300 MN55442 Minneapolis, 371VL 3 -f� $ �T� Section 1.1. Definitions TABLE OF CONTENTS Page ARTICLE I Definwgz 3 ARTICLE H Representations Section 2.1. Representations by the Authority Section 2.2. Representations by the Developer r:��Wei"I Authority Assistance. Issuance of Note Section 3.1. Basis for Assistance 8 Section 3.2. Issuance of Note 8 Section 3.3. Conditions Precedent to Issuance of Note 8 Section 3.4. Payment of Administrative Costs 9 Section 3.5. Authority Review of Developer's Costs 9 Section 3.6. Title 9 Section 3.7. Closing; Purchase Price 10 Section 3.8. Conditions Precedent to Conveyance of Authority Property 10 Section 3.9. Advance of Land; Tax Increment Interfund Loan 10 Section 3.11. Status of Developer Property 1 I (i) ARTICLE IV Construction of Improvements Section 4.1. Construction of Improvements 12 Section 4.2. Construction Plans 12 Section 4.3. Commencement and Completion of Construction 12 Section 4.4. Certificate of Completion 13 Section 4.5. Management of Improvements 13 Section 4.6. Playground 14 Section 5.1. Insurance Section 5.2. Condemnation "ftw-RALIA Insurance and Condemnation ARTICLE VI Taxes: Tax Increment 15 16 Section 6.1. Real Property Taxes 18 Section 6.2. Tax Increment 19 Section 6.3. Developer's Representations Concerning Note 19 Section 6.4. Income and Rent Restrictions 20 Section 6.5. Assessment Agreement 21 ARTICLE VII Morrtgne Financing Section 7.1. Mortgage Financing 22 ARTICLE VIII Prohibitions Against Assipment and Transfer,• Indemnification Section 8.1. Prohibition Against Transfer of Property and Assignment of Agreement 23 Section 8.2. Release and Indemnification 23 Section 8.3. Environmental Conditions 24 ARTICLE IX Events of Default Section 9.1. Events of Default Defined 25 Section 9.2. Authority's Remedies on Default 25 Section 9.3. No Remedy Exclusive 26 Section 9.4. No Additional Waiver Implied by One Waiver 26 Section 9.5. Costs of Enforcement 26 Section 6.6. The Developer's Option to Terminate 26 Section 6.7. Action to Terminate 26 Section 6.8. Effect of Termination 26 ARTICLE X Additional Provisions Section 10.1. Representatives Not Individually Liable 28 Section 10.2. Restrictions on Use 28 Section 10.3. Titles of Articles and Sections 28 Section 10.4. Notices and Demands 28 Section 10.5. Disclaimer of Relationships 29 Section 10.6. Modifications 29 Section 10.7. Counterparts 29 Section 10.8. Judicial Interpretation 29 Section 10.9, Business Subsidy Act 29 Section 10.10. Termination 29 SCHEDULE A SCHEDULE B SCHEDULE C SCHEDULE D SCHEDULE E SCHEDULE F Description of Property Note Developer Pro forma Assessment Agreement Deed Interfund Loan Resolution PURCHASE AND DEVELOPMENT AGREEMENT THIS AGREEMENT, made on or as of the A&day of 2014, by and between the New Hope Economic Development Authority, a publa bo& politic and corporate under the laws of the State of Minnesota (hereinafter referred to as the "Authority"), and having its principal office at City Hall, 4401 Xylon Avenue North, New Hope, Minnesota 55428, and Compass Pointe Limited Partnership, a Minnesota limited partnership (hereinafter refereed to as the "Developer"), having its principal office at 7500 West 78" Street, Edina, Minnesota 55439. WHEREAS, The Authority is a municipal economic development authority organized and existing pursuant to the Constitution and laws of the State of Minnesota and is governed by its Board of Commissioners (the "Board"); and WHEREAS, the Authority and the City of New Hope, Minnesota (the "City'l have established within the City Redevelopment Project No. 1 pursuant to Minnesota Statutes. Sections 469.001 - 469.047, providing for the development and redevelopment of certain areas located within the City (which development district is hereinafter referred to as the "Project"); and WHEREAS, the Authority and the City have further established the Compass Pointe Tax Increment Financing District within the Project pursuant to Minnesota Statutes. Sections 469.174-469.179 (which tax increment financing district is hereinafter referred to as the "Tax Increment District"); and WHEREAS, the Tax Increment District is a housing tax increment financing district intended to provide affordable rental housing for low and moderate income persons and families; and WHEREAS, pursuant to Minnesota Statutes, Section 469.176, subdivision 4, tax increment derived from the Tax Increment District may be used in accordance with the tax increment financing plan created in connection with the establishment of the Tax Increment District to pay the public redevelopment costs of the Project; and WHEREAS, the Developer has presented to the Authority a proposal pursuant to which the Developer will acquire certain real property within the Project (which property is hereinafter referred to as the "Property" and is more particularly described in Schedule A annexed hereto and made a part hereof) and construct thereon a 68 -unit residential rental facility; and WHEREAS, a portion of the Property is owned by the City (the "Authority Property") and a portion of the Property is owned by the Developer (the "Developer Property'); and WHEREAS, the City and the Developer have entered into an option agreement (the "Option Agreement") pursuant to which the City has agreed to convey the Authority Property to the Developer; and WHEREAS, the Developer has as a part of its proposal requested that the Authority provide certain financial assistance to aid in its development, without which such development would not be possible; and WHEREAS, Authority believes that the provision of the affordable housing as proposed by the Developer is in the best interest of the City and its residents and in accord with the public purposes and provisions of applicable federal, state and local laws under which the Project is being undertaken and assisted; NOW THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: Definitions Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Act" means Minnesota Statutes, Sections 469.001-469.047, as amended. "Agreement" means this Agreement, as the same may be from time to time modified, amended, or supplemented. "Assessment Agreement" means the agreement in the form attached to this Agreement as Schedule D. "Authority" means the New Hope Economic Development Authority, a public body Politic and corporate, its successors and assigns. "Authority Property" means the property described as such on the attached Schedule A. "Available Tax Increment" means, with respect to a Scheduled Payment Date, as defined in the Note, ninety percent (90%) of the Tax Increment received by the Authority in the six (6) month period preceding such Scheduled Payment Date. "Board" means the Authority's Board of Commissioners. "City" means the City of New Hope, Minnesota. "Construction Plans" means the site plan, utility plan, grading and drainage plan, landscape plan, elevations drawings and related documents on the construction work to be performed by the Developer on the Property which have been or will be submitted for approval by the Board, together with the resolution of the Board approving such pians and the plans, specifications, drawings and related documents on the construction work to be performed by the Developer on the Property which are to be submitted to the building inspector of the City. "County" means Hennepin County, Minnesota. "Deed" means the deed in the form of Schedule E attached hereto. "Developer" means Compass Pointe Limited Partnership, a Minnesota limited partnership, its successors and assigns and any future owner of any right, title or interest in the Property. "Developer Property" means the property described as such on the attached Schedule A. "Event of Default" means an action by the Developer listed in Article IX of this Agreement. "Improvements" means the improvements to be constructed by the Developer on the Property, consisting of the construction of a 68 -unit rental housing development together with parking and other incidental and relaxed improvements in accordance with the approved Construction Plans. "Minimum Market Value" means the market value for tax purposes of the Property and Improvements established by the Assessment Agreement. "Net Proceeds" means any proceeds paid by an insurer to the Developer or the Authority under a policy or policies of insurance required to be provided and maintained by the Developer pursuant to Article V of this Agreement and remaining after deducting all expenses (including fees and disbursements of counsel) incurred in the collection of such proceeds. "Note" means the Taxable Limited Revenue Tax Increment Note to be issued by the Authority pursuant to Section 3.2 of this Agreement, which Note shall be substantially in the form of the Note attached to this Agreement as Schedule B. "Option Agreement' means that certain Option Agreement by and between the City and the Developer dated as of June 4, 2012, as amended as of the date hereof. "Permitted Encumbrances" means the provisions of the Deed and this Agreement: reservations of minerals or mineral rights to the State of Minnesota; public utility, roadway and other easements which will not adversely affect the development and use of the Authority Property pursuant to the Developer's Construction Plans; building laws, regulations and ordinances consistent with the Improvements; restrictions, covenants and easements of record that do not materially adversely affect the development and use of the Improvements and are reasonably acceptable to the Developer; and exceptions to title to the Authority Property which are not objected to by Developer upon examination of the title evidence delivered to the Developer pursuant to the terms of the Option Agreement. "Project" means the Authority's Redevelopment Project No. 1. "Project Area" means the real property located within the boundaries of the Project. "Project Plan" means the redevelopment plan adopted in connection with creation of the Project. "Property" means the real property described as such on the attached Schedule A, consisting of the Authority Property and the Developer Property. "Reimbursable Costs" means the costs to be reimbursed by the Authority to the Developer as described in Article III of this Agreement, which costs consist of the cost of constructing the Improvements. "State" means the State of Minnesota. "Tax Increment" means that portion of the real property taxes paid with respect to the Property and Improvements that is remitted to the Authority as tax increment pursuant to the Tax Increment Act, minus deductions required by law. "Tax Increment Act" means the Tax Increment Financing Act, Minnesota Statutes. Sections 469.174-469.1794, as amended and as it may be further amended from time to time. "Tax Increment District" means the Compass Pointe Tax Increment Financing District created by the Authority within the Pmject'Area. "Tax Increment Plan" means the tax increment financing plan adopted by the Authority in connection with its creation of the Tax Increment District, which plan together with the information and findings contained therein is hereby incorporated herein and made a part hereof by reference. "Termination Date" means the latest of the following dates: (i) the date that the Note is paid in full or terminated; (ii) the date that this Agreement is terminated-, or (iii) the date that the Interfund Loan described in Section 3.9(b) has been paid in full. "Unavoidable Delays" means delays which are the direct result of acts of God, unforeseen adverse weather conditions, strikes, other labor troubles, fire or other casualty to the Irnprovemeats, litigation commenced by third parties which, by injunction or other similar judicial action, directly results in delays, or acts of any federal, state or local governmental unit, and which directly results in delays. 5 ARTICLE H Representations Section 2.1. Rg sentations by the Auffiority., The Authority nukes the following representations as the basis for the undertaking on its part herein contained: (a) The Authority is a municipal economic development authority organized and existing under the laws of the State. Under the laws of the State, the Authority has the power to enter into this Agreement and to perform its obligations hereunder. (b) The Authority will cooperate with the Developer with respect to any litigation commenced with respect to the Project Plan, Project, or Improvements and in the Developer's acquisition of any permits or other approvals required in connection with the construction of the Improvements. (c) The Authority has received no notice or communication from any local, state or federal official that the activities of the Developer or the Authority in the Project Area may be or will be in violation of any environmental law or regulation The Authority is aware of no facts the existence of which would cause it or any portion of the Authority Property to be in violation of any local, state or federal environmental law, regulation or review procedure. (d) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fiA llment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions or provisions of any restriction or any evidences of indebtedness, agreement or instrument of whatever nature to which the Authority is now a party or by which it is bound, or constitutes a default under any of the foregoing (e) To the best of the Authority's knowledge, there is no litigation, pending or threatened, regarding the Authority Property or challenging the validity of this Agreement. (fl The Authority will not issue any further obligations that are payable from or secured by the Available Tax Increment prior to the date that the Note has been paid in full, or terminated in accordance with its terms, without the prior written consent of the Developer. Section 2.2. Kgtations by the Develop, The Developer represents that: (a) The Developer is a limited partnership duly organized and authorized to transact business in the State, is not in violation of any provisions of its articles of partnership agreement or the laws of the State, has power to enter into this Agreement and has duly authorized the execution, delivery and performance of this Agreement by proper action of its board of general partners. (b) The Developer will construct the Improvements in accordance with the terms of this Agreement and all local, state and federal laws and regulations (including, but not limited to, 6 environmental, zoning, building code and public health laws and regulations), except for variances necessary to construct the improvements contemplated in the Construction Plans approved by the Authority. (c) The Developer has received no notice or communication from any local, state or federal official that the activities of the Developer or the Authority in the Project Area may be or will be in violation of any environmental law or regulation. The Developer is aware of no facts the existence of which would cause it to be in violation of any local, state or federal environmental law, regulation or review procedure. In the event that it is necessary to take any action to obtain any necessary permits or approvals with respect to the Property under any local, state or federal environmental law or regulation, the Developer will be responsible for taking such action. (d) The Developer will obtain, in a timely manner, all required permits, licenses and approvals, and will meet, in a timely manner, all requirements of all applicable local, state and federal laws and regulations which must be obtained or met before the Improvements may be lawfully constructed. (e) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions or provisions of any restriction or any evidences of indebtedness, agreement or instrument of whatever nature to which the Developer is now a party or by which it is bound, or constitutes a default under any of the foregoing. (f) The Developer will cooperate with the Authority with respect to any litigation commenced with respect to the Project Plan, Project, or Improvements. (g) The Developer could not and would not proceed with the construction of the Improvements absent the financial assistance being provided by the Authority pursuant to this Agreement. ARTICLE III Authori Assistance; Issuance of Note Section 3.1. Basis for Assistance. The Authority believes that there is currently a shortage of affordable rental housing for low and moderate income persons within the City. Therefore, the Authority has determined that it is in the vital interests of the City and its residents that additional affordable housing be provided and that such housing will not be provided without the financial participation of the Authority as proposed by the Developer. In consideration of the Developer's agreement to undertake the development of the Improvements, its agreement to construct as a part of the Improvements certain amenities that the Authority deems necessary and desirable, and its covenants concerning tenant incomes, the Authority is willing to cause the City to convey the Authority Property to the Developer and to defray a portion of the Developer's costs of construction of the Improvements through the issuance and the payment of the Note. Section 3.2. Issuance of Note. The Authority agrees to defray a portion of the Developer's cost of constructing the Improvements through the issuance of the Note. The costs to be reimbursed by the Authority through the issuance of the Note are referred to herein as the "Reimbursable Costs". The Reimbursable Costs consist of a portion of the cost of constructing the Improvements. The issuance of the Note shall occur when the conditions set forth in Section 3.3 have been satisfied. The principal amount of the Note will be equal to the Developer's actual Reimbursable Costs incurred and paid by the Developer, but in no event to exceed $684,250. If the Developer's documented Reimbursable Costs for such items are less than $684,250 then the amount of the Note shall be such lesser amount. The Note shall be in the form of the Note attached to this Agreement as Schedule B, with all blanks properly completed. Interest at the rate of five and one half percent (5.5%) shall accrue on the principal amount of the Note from the date of its issuance up to February 1, 2016, and shall be added to the principal amount of the Note on the first day of each February and August after its issuance up to and including February 1, 2016. From and ager February 1, 2016, until the Note is terminated or paid in full, simple non -compounding interest at the rate of five and one half percent (5.5%) shall accrue with respect to the principal amount of the Note. Section 3.3. Conditions Precedent to Issuance of Note. Notwithstanding anything to the contrary contained herein, the Authority's obligation to issue the Note shall be subject to satisfaction, or waiver in writing by the Authority, of all of the following conditions precedent: (a) the Developer shall not be in default under the terms of this Agreement; (b) the Developer shall have closed on financing sufficient to pay all costs to be incurred in connection with the acquisition and construction of the Improvements; (c) the Developer shall have paid the Reimbursable Costs as described in Section 3.2 of this Agreement and shall have provided to the Authority such documentation of such costs as the Authority shall reasonably request; and (d) the Developer shall have completed construction of the Improvements and the Authority shall have completed the financial analysis provided for in Section 3.5 of this Agreement. Section 3.4. Payment of Administrative Costs. Except for any costs required to be paid by the City pursuant to the Option Agreement, the Developer will reimburse the Authority for all out-of-pocket costs incurred by the Authority in connection with review and analysis of the development proposed under this Agreement, development of the Tax Increment Plan for the Tax Increment District; and negotiation of this Agreement and any related agreements and documents (collectively, the "Administrative Costs"). The Administrative Costs include fees paid to attorneys, the Authority's financial advisor, and any planning and engineering consultants retained by the Authority or City in connection with the construction of the Improvements. As security for the Administrative Costs, the Developer deposited with the Authority the amount of $10,000, and the Authority shall pay the Administrative Costs from such funds. If the total Administrative Costs exceed $10,000, the Developer rernains responsible for such excess costs, and must pay such costs to the Authority within 10 days after receipt of a written invoice from the Authority describing the amount and nature of the costs to be reimbursed. After the Note has been issued and the certificate of completion referenced in Section 4.4 has been executed and delivered, and all the Administrative Costs related to such actions have been paid, the Authority will refund to the Developer any portion of the balance from the $10,000 deposit (if any) that is not needed to cover the Administrative Costs through such reimbursement date. Notwithstauduag anything to the contrary herein, the Developer remains obligated to pay the Administrative Costs after issuance of such certificate of completion, including the costs of any amendments to this Agreement or to the Note. Section 3.5. Authorijy Review of Develo Costs. The Authority's determination to issue the Note to the Developer is based on the Developer's representations regarding its costs of constructing the Improvements. Based on those representations the Authority has determined that reimbursement of the Developer through the issuance of the Note for the Reimbursable Costs is necessary to assist in making the construction and ownership of the Improvements financially feasible. Attached to this Agreement as Schedule C is a financial pro forma provided to the Authority by the Developer setting forth the Developer's anticipated costs associated with the acquisition of the Property and construction of the Improvements. Within thirty (30) days after the Developer's completion of construction of the Improvements and payment of all costs associated with such construction, the Developer shall furnish to the Authority an updated pro forma showing the Developer's actual costs incurred in connection with the construction of the Improvements, together with such supporting documentation as the Authority may require. If such updated pro forma shows that the Developer's total costs of acquiring the Property and constructing the Improvements is less than the amount shown on the pro forma attached hereto as Schedule C, the principal amount of the Note to be issued pursuant to Section 3.2 shall be reduced by $.50 for each $1.00 that the Developer's actual costs are less than the amount estimated as shown on Schedule C. Section 3.6. Title. Submission of evidence of title to the Authority Property and Developer's review of title shall occur in accordance with the terms of the Option Agreement.. Section 3.7. C o ' . Purchase Price. (a) Closing on the conveyance of the Authority Property to the Developer shall occur on such date the# the conditions precedent contained in Section 3.8 have been satisfied or waived. (b) At the closing on the conveyance of the Authority Property the Authority shall cause the City to deliver to the Developer: (i) a Deed duly executed and acknowledged conveying to the Developer marketable title to the Authority Property subject only to Permitted Encumbrances; and (ii) such other documents as are required to be delivered pursuant to the terms of the Option Agreement. (c) Closing costs associated with the conveyance of the Authority Property will be allocated as provided in the Option Agreement. (d) The purchase price to be paid by the Developer to acquire the Authority Property shall be $304,000 and shall be payable at closing. Section 3.8. Conditions Precedent to Conveyance of the AuthorityProperty. The Authority's obligation to cause the City to sell and the Developer's obligation to purchase the Authority Property shall be subject to satisfaction of the following conditions precedent: (a) The Developer having secured financing or provided to the Authority evidence reasonably satisfactory to the Authority of its ability to secure financing sufficient for the acquisition of the Property and the construction of the lmprovements. (b) The Developer having reviewed and approved, or waived any objections to, title to the Authority Property pursuant to Section 3.6 of this Agreement. (c) The Developer having secured the Authority's approval of the Construction Plans and all other governmental approvals necessary to permit the construction and operation of the Improvements. (d) The Developer shall have acquired the Developer Property. (e) The Developer and the City shall be in compliance with the terms of the Option Agreement. If all of the conditions precedent to the conveyance of the Authority Property have not been satisfied by July 1, 2014, the Authority shall have the right to terminate this Agreement by giving written notice of termination to the Developer, upon which this Agreement shall terminate and the Authority and Developer shall execute an instrument in recordable form evidencing such termination. Section 3.9. Advance of Land,• Tax Increment Interfand Loan. (a) The City has acquired the Authority Property and the City and the Authority have incurred certain costs to prepare such property for redevelopment, including payment of relocation costs, environmental remediation, demolition of buildings and site clearance. After Developer's payment of the 10 purchase price for the Authority Property there will remain unreimbursed costs incurred by the City and the Authority in the approximate amount of $149,300 (the "City Costs"). Subject to all the terms and conditions of this Agreement, upon the conveyance of the Authority Property to the Developer, the City and the Authority will forego receipt of the City Costs and the City Costs will remain outstanding. The City and the Authority shall reserve the right to collect such City Costs through the Interfund Loan, as described in Section 3.9(b) below. (b) The Authority will treat the amount of the City Costs as an interfund loan (the "Interfimd Loan") within the m miing of Section 469.178, Subdivision 7 of the Tax Increment Act. The terms of the Inwxfund Loan are described in the resolution attached as Schedule F (the "Loan Resolution"). Until the Note has been paid in full, or terminated in accordance with its terms, the Interfund Loan will be payable only from Tax Increment received by the Authority that is in excess of Available Tax Increment. Section 3.10. Status of Pg3MIoM Pro a The Developer Property consists of the real property described as such on Schedule A attached hereto. As of the date of this Agreement, the Developer has entered into a purchase agreement to acquire the Developer Property for $240,000. II ARTICLE IV Construction of Improvements Section 4.1. Construction _of Improvements. The Developer agrees that it will construct the Improvements on the Property in material accordance with the approved Construction Plans and at all times prior to the Termination Date will operate and maintain, preseive and keep the Improvements or cause the Improvements to be maintained, preserved and kept with the appurtenances and every part and parcel thereof, in good repair and condition. "Material accordance" with the Construction Plans, for purposes of this Agreement, shall mean without a "material change" from the Construction Plans, as defined in Section 4.2(b). Section 4.2. Construction Plans. (a) The Developer has submitted and the City and the Authority have approved a site plan for the construction of the Improvements (the "Site Plan"). All Construction Plans for the Improvements shall be consistent with the approved Site Plan, The Construction Plans shall provide for the construction of the Improvements and shall be in conformity with this Agreement, the Site Plan approved by the Authority, and all applicable state and local laws and regulations. The Authority shall approve the Construction Plans in writing if; in the reasonable discretion of the Authority: (i) the Construction Plans conform to the terms and conditions of this Agreement; (ii) the Construction Plans are consistent with the Site Plans previously submitted to the Authority; (iii) the Construction Plans conform to all applicable federal, State and local law, ordinances, rules and regulations; (iv) the Construction Plans are adequate to provide for the construction of the Improvements; (v) the Construction Plans do not provide for expenditures in excess of the funds which will be available to the Developer for the construction of the Improvements; and (vi) no Event of Default has occurred. No approval by the Authority under this Section 4.2 shall relieve the Developer of the obligation to comply with the terms of this Agreement or applicable federal, state and local laws, ordinances, rules and regulations, or to construct the Improvements. No approval by the Authority shall constitute a waiver of an Event of Default. Such Construction Plans shall, in any event, be deemed approved unless rejected in writing by the Authority, in whole or in part. Such rejection shall set forth in detail the reasons therefor, and shall be made within thirty (30) days after the date of their receipt by the Authority. The provisions of this Section relating to approval, rejection and resubmission of corrected Construction Plans shall continue to apply until the Construction Plans have been approved by the Authority or until this Agreement is terminated. The Authority's approval shall not be unreasonably withheld. Notwithstanding any other provisions of this Agreement, the issuance by the City of a building permit for the Project shall constitute the approval of the Construction Plans by the City and the Authority as provided herein. (b) If the Developer desires to make any material change in any Construction Plans after their approval by the Authority, the Developer shall submit the proposed change to the Authority for its approval. For purposes of this Agreement, a "material change" means a change that changes the size, nature or exterior appearance of the Improvements or that reduces the value of the Improvements. If the Construction Plans, as modified by the proposed change, conform to the requirements of this Section 4.2 of this Agreement with respect to such previously approved Construction Pians, the Authority shall approve the proposed change and 12 notify the Developer in writing of its approval. Any requested change in the Construction Plans shall, in any event, be deemed approved by the Authority unless rejected, in whole or in part, by written notice by the Authority to the Developer, setting forth in detail the reasons therefor. Such rejection shall be made within ten (10) days after receipt of the notice of such change. Section 4.3. Commencement and Completion of Construction. (a) Subject to Unavoidable Delays, the Developer shall commence construction of the Improvements by September 1, 2014, or on such other date as the parties shall mutually agree. Subject to Unavoidable Delays, the Developer shall complete the construction of the Improvements by December 31, 2015. All work with respect to the Improvements to be constructed or provided by the Developer on the Property shall be in conformity with the Construction Plans as submitted by the Developer and approved by the Authority. (b) Until construction of the Improvements has been completed, the Developer shall make construction progress reports, at such times as may reasonably be requested by the Authority, but not more than once a month, as to the actual progress of the Developer with respect to such construction. Section 4.4. C Wfieate of Coompletim, (a) Promptly after completion of the Improvements in accordance with those provisions of this Agreement relating solely to the obligations of the Developer to construct the Improvements, and upon request by the Developer, the Authority will furnish the Developer with a Certificate of Completion for the Improvements in a form acceptable for recording in the County Recorder's Office or the Office of the Registrar of Titles. The Certificate of Completion shall be famished to the Developer within, ten (10) business day after request by the Developer, and shall conclusively satisfy and terminate the agreements and covenants in this Agreement and in the Deed of the Developer, and its successors and assigns, to construct the Improvements. Such certification and such determination shall not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any Holder of a Mortgage, or any insurer of a Mortgage, securing money loaned for construction of the Minimum Improvements, or any part thereof. (b) If the Authority shall refuse or fail to provide a Certificate of Completion in accordance with the provisions of this Section 4.4 of this Agreement, the Authority shall, within ten (10) business day after written request by the Developer for the Certificate of Completion, provide the Developer with a written statement, indicating in adequate detail in what respects the Developer has failed to complete the Improvements in accordance with the provisions of this Agreement and what measures or acts will be necessary, in the opinion of the Authority, for the Developer to take or perform in order to obtain the Certificate of Completion. (c) The construction of the Improvements shall be deemed to be completed when the City has issued a final certificate of occupancy for the Improvements (or when the Developer would be entitled to a certificate of occupancy if it requested one), and when all conditions imposed in connection with the City's approval of the Developer's development, including the establishment of any completion escrow, if necessary, have been satisfied. 13 Section 4.5. Management of Improvements. The Developer shall at all times either self -manage (upon submission of evidence of experience in operating multifamily residential developments) or engage Steven Scott Management or another property management company with substantial experience in operating multifamily residential developments, subject to approval by the Authority, which approval will not be unreasonably withheld. The Developer will submit evidence of such management by February 1, 2016. Section 4.6. Plavaround. The Developer shall construct the playground portion of the Improvements (the "Playground") in conformity with the planned unit development approved by the City for the Property and Improvements and the approved Site Plan for the use and enjoyment of residents and invitees of the Improvements. The Playground shall incorporate amenities described in Developer's site plan approved by the City. The parties agree and understand that the Developer shall be responsible for the cost of the maintenance and operation of the Playground. 14 ARTICLE V Insurance and Condemnation Section 5.1. Insurance. (a) The Developer will provide and maintain at all times during the process of constructing the 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 (10011/o) of the insurable value of the Improvements at the date of completion, and with coverage available in nonreporting form on the so called "all risk" form of policy; (ii) Comprehensive general liability insurance (including operations, contingent liability, operations of subcontractors, completed operations, Broadening Endorsement including contractual 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) Worker's compensation insurance, with statutory coverage and employer's liability protection. The policies of insurance required pursuant to clauses (i) and (ii) above shall be in form and content satisfactory to the Authority and shall be placed with financially sound and reputable insurers licensed to transact business in the State, the liability insurer to be rated A or better in Best's Insurance Guide. The policy of insurance delivered pursuant to clause (i) above shall contain an agreement of the insurer to give not less than thirty (30) days' advance written notice to the Authority ' in the event of cancellation of such policy or change affecting the coverage thereunder. (b) Upon completion of construction of the Improvements and prior to the Termination Date, the Developer 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 Improvements 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, all risk 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 the Improvements, but any such policy may have a deductible amount of not more than $10,000. 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 - 15 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 Improvements (excluding foundation and excavation costs and costs of underground flues, pipes, drains and other uninsurable items) and equipment, and shall be determined from time to time at the request of the Authority, but not more frequently than once every three years, by an insurance consultant or insurer, selected and paid for by the Developer and approved by the Authority. (ii) Comprehensive general public liability insurance, including personal injury liability (with employee exclusion deleted), and automobile insurance, including owned, non -owned and hired automobiles, 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. (iii) Such other insurance, including worker's compensation insurance respecting all employees of the Developer, if any, in such amount as is • customarily carried by like organizations engaged in like activities of comparable size and liability exposure; provided that the Developer may be self-insured with respect to all or any part of its liability for worker's compensation. (c) All insurance required in Article V of this Agreement shall be taken out and maintained in responsible insurance companies selected by the Developer which are authorized under the laws of the State to assume the risks covered thereby. (d) The Developer agrees to notify the Authority imamedudely in the case of damage exceeding $100,000 in amount to, or destruction of, the Improvements or any portion thereof resulting from fire or other casualty. In the event of any such damage, the Developer will forthwith repair, reconstruct and restore the Improvements to substantially the same or an improved condition or value as existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restoration, but subject to the rights of Developer's lenders, the Developer will apply the proceeds of any insurance relating to such damage received by the Developer to the payment or reimbursement of the costs thereof. The Developer shall complete the repair, reconstruction and restoration of the Improvements, whether or not the Net Proceeds of insurance received by the Developer for such purposes are sufficient to pay for the same. Any proceeds remaining after completion of such repairs, construction and restoration shall be retained by the Developer. If the Developer fails to fulfill its obligations to repair, reconstruct and restore the Improvements within a reasonable time after the occurrence of the damage, the Authority shall be entitled, as its only remedy on account thereof, to terminate the Note. Section 5.2. Condemnation. In the event that title to and possession of the Improvements or any material part thereof shall be taken in condemnation or by the exercise of the power of eminent domain by any governmental body or other person prior to the Termination Date, the Developer shall, with reasonable promptness after such taking, notify the Authority as to the nature and extent of such taking. Upon receipt of any condemnation award, but subject to the I6 rights of Developer's lenders, the Developer shall elect to either: (a) use the entire condemnation award to reconstruct the Improvements (or, in the event only a part of Improvements have been taken, then to reconstruct such part) within the Project Area; or (b) retain the condemnation award whereupon in the event that a substantial portion of the Property and Improvements have been taken, the Authority's obligations under the Note shall terminate as of the date of the taking. 17 ARTICLE VI Taxes; Tax Increment; Assessment Acreement Section 6.1.. Real Propefiy Taxes. The Developer sball pay or cause to be paid when due and prior to the imposition of penalty all real property taxes and installments of special assessments payable with respect to the Property after the Developer aoquires the Property. In addition, the Developer agrees that prior to the Termination Date: (1) it will not seek administrative or judicial review of the applicability of any tax statute determined by any Tax Official to be applicable to the Improvements or the Property or raise the inapplicability of any such tax statute as a defense in any proceedings, including delinquent tax proceedings; (2) it will not seek administrative or judicial review of the constitutionality of any tax statute determined by any tax official to be applicable to the Improvements or the Property or raise the unconstitutionality of any such tax statute as a defense in any proceedings, including delinquent tax proceedings; and (3) it will not cause a reduction in the Minimum Market Value of the Improvements through-- (a) hrough: (a) willful destruction of the Improvements or any part thereof; (b) willful refusal to reconstruct damaged or destroyed property pursuant to Section 5.1(d) of this Agreement; (c) a request to the County assessor to reduce the assessed value of the Property below the Minimum Market Value of all or any portion of the Property or Improvements; (d) a petition to the board of equalization of the County to reduce the assessed value of the Property below the Minimum Market Value; (e) a petition to the board of equalization of the State or the commissioner of revenue of the State to reduce the assessed value of the Property below the Minimum Market Value; (fl an action in a. district court of the State or the tax court of the State seeking a reduction in the assessed value of the Property below the Minimum Market Value; (g) an application to the commissioner of revenue of the State or to any local taxing jurisdiction requesting an abatement of real property taxes regarding the Property or Improvements; (h) any other proceedings, whether administrative, legal or equitable, with any administrative body within the County or the State or with any court of the State or the federal government regarding a reduction in the assessed value of the Property below the Minimum Market Value; or (i) a transfer of the Property or Improvements, or any part thereof, to an entity exempt from the payment of real property taxes under State law. 19 Notwithstanding anything contained in this Section 6.1 or elsewhere in taus Agreement to the contrary, the Developer may contest real property taxes assessed in excess of the Minimum Market Value of the Improvements. The Developer shall notify the City and Authority of any administrative or judicial review affecting the Improvements or the Property. In such event, the Authority will continue to make payments under the Note to the Developer based upon the value stated in the Assessment Agreement, with any additional Tax Increment available for payment being withheld from Developer until such time that the administrative or judicial review affecting the Improvements or the Property is finally determined. The Developer shall not, prior to the Termination Date, apply to any taxing jurisdiction for a deferral or abatement of property tax on the Property or improvements. The parties hereto acknowledge that Developer intends to apply to have the Property certified as low-income rental housing property as described in Minnesota Statutes, Section 273.13, Subdivision 25(e). Nothing set forth in this Agreement shall restrict Developer from applying to have the Property certified as low-income rental housing property as described in Minnesota Statutes, Section 273.13, Subdivision 25(e). Section 6.2. Tax Increment. Subject to the limitations contained in the Note, the Authority hereby pledges to the payment of the Note the Available Tax Increment. Tax Increment received by the Authority in excess of Available Tax increment shall be the Authority's property and, the Authority shall be free to use such excess Tax Increment for any purpose for which such Tax Increment may be used under the Tax Increment Act. Section 6.3. Developer's R resentatxons Concernin Note. The Developer makes the following representations to the Authority with respect to the issuance of the Note: (a) The Developer has not relied on, any representations of the Authority, or any of its officers, agents, or employees, and has not relied on any opinion of any attorney of the Authority, as to the federal or State income tax consequences relating to the ownership of the Note by the Developer. (b) The Developer is sufficiently knowledgeable and experienced in financial and business matters, including the purchase and ownership of obligations of a nature similar to the Note, to be able to evaluate the risks and merits of the purchase and ownership of the Note. The Developer has been made aware of the security for the Note and the proposed uses of the proceeds of the Note, and has received the cooperation of the Authority in undertaking any due diligence that the Developer has deemed necessary or appropriate. (c) The Developer understands that the portion of the Tax Increment pledged to the payment of the Note pursuant to this Agreement is the sole source of money that is pledged and will be available for the payments due under the Note; that the Authority is not under any obligation to repurchase the Note from the Developer under any circumstances; that the Note is not a general obligation of the Authority; and that, if the Tax Increment pledged to the payment of the Note pursuant to this Agreement is not sufficient to make the payments due under the Note in full, no right will exist to have taxes levied by the Authority or the City for the payment of the unpaid amounts due under the Note. 19 (d) The Developer understands that the Tax Increment necessary to pay the Note has been estimated assuming that the Improvements will have certain market values on certain dates. All estimates of Tax Increment that have been prepared by or on behalf of the Authority have been done for the Authority's use only and neither the Authority nor its consultants shall have liability to the Developer if the actual Tax Inurement is less than the amounts estimated. In the event, among other things, the Developer fails to complete the Improvements in a timely manner or the market value of the improvements does not reach certain levels, the Tax Increment pledged to the payment of the Note may be inadequate to pay the total principal of and interest on the Note. (e) The Developer understands that the Note is not registered or otherwise qualified for sale or transfer under the securities laws and regulations of the State or under federal securities laws or regulations, the Note is not listed on any stock or other securities exchange, and the Note will carry no rating from any gating service. Except as provided herein, the Note may not be transferred to any third party without the prior written approval of the Authority. The Authority hereby approves the transfer of the Note by the Developer to the Minnesota Housing Finance Agency CWHFA") as part of the permanent financing for the Project. Any transferee of a Note shall be required to execute an instrument making the representations to the Authority contained in this Section; provided, that such requirement shall not apply to a transfer or assignment of the Note to the N1HFA. Section 6.4. Income Restrictions. (a) The Authority and the Developer understand and agree that the Tax Increment District is a "housing district" under Section 469.174, Subd. 11 of the Tax Increment Act. Accordingly, in compliance with Section 469.1761, Subd. 3 of the Tax Increment Act, the Developer agrees that the Improvements must satisfy, or be treated as satisfying, the income requirements for a qualified residential rental project as defined in Section 142(d) of the Internal Revenue Code. The parties further agree that no more than 20% of the square footage of the Improvements (which is the only building receiving assistance from Tax Increments) may consist of commercial, retail, or other nonresidential uses. The Developer must meet the above requirements as follows: (i) At least 40% of the residential units in the Improvements must be occupied or available for occupancy by persons whose incomes do not exceed 60% of the County area median income; and (ii) The limits described in clause (A) must be satisfied through the Termination Date. Income for occupants of units described in clause (A) shall be adjusted for family size in accordance with Section 142(d) of the Internal Revenue Code and related regulations. (b) On or before each January 1, commencing on January 1, 2016, the Developer or an agent of the Developer must deliver or cause to be delivered to the Authority a Compliance Certificate executed by the Developer covering the preceding six months together with written evidence satisfactory to the Authority of compliance with the covenants in this Section. This evidence must include a statement of the household income of each of qualifying renter, a. 20 written determination that each qualifying renter's household income talcs within the qualifying limits of this Section (and Section 142(d) of the Internal Revenue Code), and certification that the income documentation is correct and accurate (and that the determination of qualification was made in compliance with Section 142(d) of the Internal Revenue Code). The Authority may review, upon request, all documentation supporting the Developer submissions and statements. In detaining compliance with this Section, the Developer must use the County median incomes for the year in which the payment is due on the Note, as promulgated by the Minnesota Housing Finance Agency based on the area median incomes established by the United States Department of Housing and Urban Development. (c) In the event that there occurs a failure on the part of the Developer to comply with the restrictions contained in the Tax Increment Act or this Section 6.4 that results in liability on the part of the Authority or City for repayment of Tax Increment or penalties, the Developer shall be liable to the Authority and on demand shall pay to the Authority the amount of any liability. Without limiting any other remedy available to the Authority, the Authority shall be entitled to specifically enforce the Developer's covenants under this Section. (d) The income restrictions contained in this Section 6.4 shall apply to the Improvements until the Termination Date, notwithstanding the earlier termination of this Agreement or the Note. Section 6.5. Assessment Agreement (a) Upon commencement of construction of the improvements, the Developer shall, with the Authority, execute an Assessment Agreement pursuant to Minnesota Statutes, Section 469.177, subd. 8, specifying an assessor's Minimum Market Value for the Improvements. The amount of the minimum Market Value of the Improvements shall be $5,916,000 as of January 2, 2016 and each January 2 thereafter, notwithstanding the status of construction by such dates. (b) The Assessment Agreement shall be substantially in the form attached as Schedule D. Nothing m the Assessment Agreements shall limit the discretion of the assessor to assign a market value to the property in excess of such Minimum Market Value. The Assessment Agreement shall remain in force for the period specified in the Assessment Agreement 21 ARTICLE VII Mortgage Financing Section 7.1. Morge Financingy. On or before June 1, 2014, the Developer shall provide to the Authority evidence of a commitment for mortgage financing sufficient for construction of the Improvements. If the Authority finds that the mortgage financing is sufficiently committed, adequate in amount to provide for the construction of the Improvements, and subject only to such conditions as the Authority approves, then the Authority shall notify the Developer in writing of its approval. Such approval shall not be unreasonably withheld and either approval or rejection shall be given within fourteen (14) days from the date when the Authority is provided the evidence of mortgage financing. The issuance of a building permit for the Improvements by the City shall be deemed to evidence the Authority's approval under this Section. If the Authority rejects the evidence of mortgage financing as inadequate, it shall do so in writing specifying the basis for the rejection. In any event, the Developer shall submit adequate evidence of mortgage financing within thirty (30) days after such rejection. Notwithstanding the foregoing, the Authority acknowledges receipt from the Developer of the commitment for mortgage financing as described above and acknowledges that such commitment has been approved by the Authority. 22 ARTICLE VIII Prohibitions Azainst Asskument and Transfer Indemnification Section 8.1. Prohibition Against Transfer of Prop_ . and Assignment of Agreement. The Developer represents and agrees that the Developer has not made or created and, prior to the Termination Date, will not make or create, or suffer to be made or created, any total or partial sale, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to this Agreement or the Property or any part thereof or any interest herein or therein, or any contract or agreement to do any of the same, other than to residential tenants in the ordinary course of business, without the prior written approval of the Authority, which approval shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, the Developer may transfer the Property and assign its interest in this Agreement to an entity affiliated with the Developer or the Developer's owners provided that such new entity executes an instrument in a form acceptable to the Authority by which it assumes and agrees to perform the Developer's obligations under this Agreement. No such assignment or transfer shall relieve the Developer of any liability under this Agreement unless the Authority in writing specifically releases the Developer. A transfer of partnership interests in the Developer shall not be considered a transfer of the Property hereunder. Section 8.2. el and Indenmificafi n Cov (a) The Developer releases from and covenants and agrees that the Authority, the City and the governing body members, officers, agents, servants and employees thereof shall not be liable for and agrees to indemnify and hold harmless the Authority, the City, and the governing body members, officers, agents, servants and employees thereof against any loss or damage to property or any injury to or death of any person occurring at or about or resulting from any defect in the Improvements, provided that the foregoing indemnification obligation shall not apply to damages resulting from any actions or inactions of any of the foregoing parties that are not contemplated by this Agreement. (b) Except for any willful misrepresentation, any willful or wanton misconduct or gross negligence of the following named parties, the Developer agrees to protect and defend the Authority, the City, and the governing body members, officers, agents, servants and employees thereof, now or forever, and further agrees to hold the aforesaid harmless from any claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising from this Agreement, or the transactions contemplated hereby or the acquisition, construction, installation, ownership, and operation of the Improvements. (c) The Authority, the City, and the - governing body members, officers, agents, servants and employees thereof shall not be liable for any damage or injury to the persons or property of the company or its officers, agents, servants or employees or any other person who may be about the Property or Improvements due to any act of negligence of any person. (d) All covenants, stipulations, promises, agreements and obligations of the Authority contained herein shall be deemed to be the covenants, stipulations, promises, agreements and 23 obligations of the Authority and not of any governing' body member, officer, agent, servant or employee of the Authority in the individual capacity thereof. (e) Nothing in this Section or Section 8.3 will be construed to limit or affect any limitations on liability of the City or Authority under State or federal law, including without limitation, Minnesota Stwdes Sections 466.04 and 604.02. Section 8.3. Environmental Conditions. (a) The Developer acknowledges that the Authority makes no representations or warranties as to the condition of the soils of the Property or the fitness of the Property for construction of the Minimum Improvements or any other purpose for which the Developer may make use of such property, and that the assistance provided to the Developer under this Agreement neither implies any responsibility by the Authority for any contamination of the Property nor imposes any obligation on the Authority to participate in any cleanup of the Property. The City has made certain representations and has agreed to certain obligations in the Option Agreement. (b) Without limiting its obligations under Section 8.2 of this Agreement, the Developer further agrees that, except for any misrepresentation or any misconduct or affirmative act by the Authority or the City and except for any breach by the Authority of its obligations under this Agreement and except for the City's obligations with respect to the environmental condition of the Property as provided in the Option Agreement, the Developer will indemnify, defend, and hold harmless the Authority, the City, and their governing body members, officers, and employees, from any claims or actions arising out of the presence, if any, of hazardous wastes or pollutants existing on or in the Property, unless and to the extent that such hazardous wastes or pollutants are present as a result of the actions or omissions of the indemnities; provided, however, that such indemnification obligations do not apply to costs for which the City is responsible under the teras of the Option Agreement. Nothing in this section will be construed to limit or affect any limitations on liability of the City or Authority under State or federal law, including without limitation, Minnesota Statutes Sections 466.04 and 604.02. 24 ARTICLE IX Events of Default Section 9.1. Events of Default Defined. The term "Event of Default" shall mean, whenever it is used in this Agreement (unless the context otherwise provides): (a) any failure by Developer to observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed hereunder; or (b) if, before issuance of the certificate of completion for the improvements, the Developer shall (i) file any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act or under any similar federal or State law, which action is not dismissed within sixty (60) days alter filing; or [11 (ii) make an assignment for benefit of its creditors; or (iii) admit in writing its inability to pay its debts generally as they become due; (iv) be adjudicated a bankrupt or insolvent. Section 9.2. Authority's Remedies an Default: Whenever any Event of Default by Developer referred to in Section 9.1 of this Agreement occurs, the Authority may immediately suspend its performance under this Agreement and/or the Note until it receives assurances from the Developer, deemed adequate by the Authority, that the Developer will cure its default and continue its performance under this Agreement and may take any one or more of the following actions after providing thirty (30) days written notice to the Developer of the Event of Default, but only if the Event of Default has not been cured within said thirty (30) days, or such longer period of time as the Authority may reasonably determine if the Event of Default is of a nature that it cannot be cured in thirty (30) days: (a) Terminate this Agreement and/or the Note. (b) Take whatever action, including legal, equitable or administrative action, which may appear necessary or desirable to the Authority to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant of the Developer under this Agreement. Developer's investor limited partner ("Investor Limited Partner") shall have the right, but not the obligation, to cure any Event of Default by Developer under this Agreement or any default under any other document to be executed in connection herewith, and Authority shall accept performance by Investor Limited Partner of any obligation of Developer thereunder as though 25 tendered by Developer itself, provided such performance by Investor Limited Partner has occurred during the applicable cure period, if any, provided to Developer thereunder with respect to such default or Event Of Default. Section 9.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to the Authority or Developer is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Authority or the Developer to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in this Article IX. Section 9.4. No Additional Waiver Implied by One Waiver. In the event any agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. Section 9.5. Costs of Enforcement. 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 of performance or observance of any obligation or agreement on the part of the Developer under this Agreement, the Developer agrees that it shall be liable for the reasonable fees of such attorneys and such other expenses so reasonably incurred by the Authority. Section 9.6 The Deveio er's Option to Terminate. This Agreement may be terminated by Developer, if (i) the Developer is in compliance with all material terms of this Agreement and no Event of Default has occurred; and (ii) the Authority fails to comply with any material term of this Agreement, and, after written notice by the Developer of such failure, the Authority has failed to cure such noncompliance within ninety (90) days of receipt of such notice, or, if such noncompliance cannot reasonably be cured by the Authority within ninety (90) days, of receipt of such notice, the Authority has not provided assurances, treasonably satisfactory to the Developer, that such noncompliance will be cured as soon as reasonably possible. Section 9.7 Action to Terminate. Termination of this Agreement pursuant to Section 9.6 must be accomplished by written notification by the Developer to the Authority within thirty (30) days after the date when such option to terminate may first be exercised. A failure by the Developer to terminate this Agreement within such period constitutes a waiver by the Developer of its rights to terminate this Agreement due to such occurrence or event. Section 9.8 Effect of Termination. If this Agreement is terminated pursuant to Sections 9.6 and 9.7, this Agreement shall be from such date forward null and void and of no further effect; provided, however, the termination of this Agreement shall not affect the rights of either party to institute any action, claim or demand for damages suffered as a result of breach or default of the terms of this Agreement by the other party, or to recover amounts which had 26 accrued and become due and payable as of the date of such termination. Upon termination of this Agreement pursuant to Sections 9.6 and 9.7, the Developer shall be free to proceed with the Project at its own expense and without regard to the provisions of this Agreement; provided., however, that the Authority shall not be required to make any further payments on the Note. 27 ARTICLE X Additional Provisions Section 10.1. Representatives Not Individnally Liable. No member, official, or employee of the Authority shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach or for any amount which may become due to Developer or successor or on any obligations under the terms of the Agreement. Section 10.2. Restrictions on Use. The Developer agrees for itself, and its successors and assigns, and every successor in interest to the Property, or any part thereof, that the Developer, and such successors and assigns, shall until the Termination Date devote the Property to, and only to and in accordance with, the uses specified in this Agreement. Section 10.3. Titles of Articles and Sections. Any titles of the several parts, Articles, and Sections of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 10.4. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under the Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally; and (a) in the case of the Developer, is addressed to or delivered personally to the Developer at 7500 West 78* Street, Edina, Minnesota 55439, with copies to: Winthrop & Weinstine, P.A. Capella Tower, Suite 3500 225 South Sixth Street Minneapolis, MN 55402 Attn: Jeffrey Koerselman And so long as any affiliates of Wells Fargo Bank, N.A. owns a partnership interest in Developer, to: Wells Fargo Affordable Housing Community Development Corporation MAC D1053-170 301 South College Street, 17th Floor Charlotte, NC 28202.6000 Attention: Director of Asset Management; and (b) in tue case of the Authority, is addressed to or delivered personally to the Authority at City Hall, 4401 Xylon Avenue North, New Hope, Minnesota 55428. Or at such other address with respect to either such party as that party may, from time to time, designate in writing and forward to the other as provided in this Section. 28 Section 10.5. Disclaimer of Relationships. Nothing contained in this Agreement nor any act by the Authority or the Developer shall be deemed or construed by any person to create any relationship of third -party beneficiary, principal and agent, limited or general partner, or joint venture among the Authority, the Developer, and/or any third party. Section 10.6. Modifications. This Agreement may be modified solely through written amendments hereto executed by the Developer and the Authority. Section 10.7. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 10.8. Judicial laIg retation. Should any provision of this Agreement require judicial interpretation, the count interpreting or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against one party by reason of the rule of construction that a document is to be construed more strictly against the party who itself or through its agent or attorney prepared the same, it being agreed that the agents and attorneys of both parties have participated in the preparation hereof. Section 10.9. Business Subsid Act Because the Authority's assistance to the Developer's development is being made available for the purpose of encouraging the development of housing, the assistance does not constitute a business subsidy within the meaning of Minnesota Statutes, sections 116J.993 to 116J.995. Section 10.10 Termination. This Agreement shall be null and void on the Termination Date, provided, that Sections 8.2 and 8.3 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. 29 IN WITNESS WHEREOF, the Authority has caused this Agreement to be duty executed in its name and behalf and the Developer has caused this Agreement to be duly executed in its name and behalf on or as of the date fust above written. 1' 1) W1.6 1 i 1 1 1' • COMPASS POINTE LEWMD PARTNERSHIP By Compass Pointe, LLC, its General Partner By Ronald Clark, its Chief Manager STATE OF MINNESOTA ) ) SS. COUNTY OF TheVeffoling ' ent was aced Fore ejthisjday of2014, by1 = and ,1�IL, �pl the President and Executive Director of the New Hope Economic Development Authority, a public body politic and corporate, on behalf of the authority. Notary Public STEVEN A. SONDRALL STATE OF ll9QNNESOTA) ''' ! Notary €'uN:c-Minnesota SS. ' �.... �; td'v CMnmiss,on E B.aa 31 dU5 COUNTY OF The foregoing instrument was acknowledged before me this day of , 2014, by Ronald Clark, the Chief Manager of Compass Pointe, LLC, a Minnesota limited liability company, the general partner of of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public 30 IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf and the Developer has caused this Agreement to be duly executed in its name and behalf on or as of the date first above written. NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY COMPASS POINTE LIMITED PARTNERSHIP By Co pass Pointe, LLC, its Genegil Partner &Z4�:4 e N'*- A0 By Ronald Clark, its Chief Manager STATE OF MINNESOTA ) ) SS. COUNTY OF ] The foregoing instrument was acknowledged before me this day of 2014, by and 'the President and Executive Director of the New Hope Economic Development Authority, a public body politic and corporate, on behalf of the authority. STATE OF MINNESOTA ) ) SS. COUNTY OF 4! v" Notary Public SARAN MARY D"LO" Notary PWft-M1nnmW * Oon mn E00Jas 37, 2M7 The foregoing instrument was acknowledged before me this P-� day of ajA , 2014, by Ronald Clark, the Chief Manager of Compass Pointe, LLC, a Minnesota limited liability company, the general partner of of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership_ Notar` Public 30 SCHEDULE A Description of Property Authority Property: Outlot 1, Mork -Campion Heights, Hennepin County, Minnesota (Torrens Property Torrens Certificate No.1330260) The East 75 Feet of Oudot 2, Mork -Campion Heights as measured at a right angle from the East lime thereof, Hennepin County, Minnesota The West 75 Feet of the East 150 feet of Oudot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota The West 75 Feet of the East 225 feet of Outlot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota Developer Property: The West 75 feet of the East 300 feet of Outlot 2, Mork -Campion Heights, Hennepin County Minnesota, according to the recorded plat thereof as measured at a right angle from the East litre thereof The Developer Property and the Authority Property will be platted as Lot 1, Block 1, Compass Pointe, Hennepin County, Minnesota. SCHEDULE B UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY TAXABLE LIMITED REVENUE TAX INCREMENT NOTE (COMPASS POINTE LIMITED PARTNERSHIP) 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 Compass Pointe Limited Partnership, a Minnesota limited partnership, or its permitted assigns (the "Owner"), solely from the source, to the extent and in the manner hereinafter provided, the principal amount of this Note, being Six Hundred Eighty Four Thousand Two Hundred Fifty Five Dollars ($684,255.00) (the "Principal Amount"), commencing on August 1, 2016, and continuing on each February 1 and August 1 thereafter up to and including February 1, 2042 (the "Scheduled Payment Dates"). Interest at the rate of five and one half percent (5.5%) per annum shall accrue from the date of this Note on the Principal Amount and shall be added to the Principal Amount on each February 1 and August 1 up to and including February 1, 2016. From and after February 1, 2016, simple non -compounding interest at the rate of five and one half percent (5.5%) shall accrue on the outstanding Principal Amount until this Note has been paid in full or terminated in accordance with its terms. This Note is the Note defined in that certain Purchase and Development Agreement dated as of , 2014, between the Authority and the Owner (the "Contract"). 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 Owner and mailed to the Owner at its postal address within the United States which shall be designated from time to time by the Owner. The Note is a special and limited obligation and not a general obligation of the Authority, which has been issued by the Authority pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Section 469.178, subdivision 4, to aid in financing a "project", as therein defined, of the Authority consisting generally of defraying certain capital and administrative costs incurred and to be incurred by the Authority within and for the benefit of its Redevelopment Project No. 1 (the "Project"). THIS NOTE IS A SPECIAL AND LIMITED AND NOT A GENERAL OBLIGATION OF THE AUTHORITY PAYABLE SOLELY OUT OF AVAILABLE TAX INCREMENT, AS DEFINED BELOW, AND NEITHER THE STATE, THE CITY OF NEW HOPE, NOR ANY POLITICAL SUBDIVISION OF THE STATE, SHALL BE LIABLE ON THIS NOTE, NOR SHALL THIS NOTE BE PAYABLE OUT OF ANY FUNDS OR PROPERTIES OTHER THAN AVAILABLE TAX INCREMENT. The scheduled payment of this Note due on any Scheduled Payment Date is payable solely from and only to the extent that the Authority shall have received in the six (6) month period preceding such Scheduled Payment Date "Available Talc Increment" _ For purposes of this Note, Available Tax Increment with respect to any Scheduled Payment Date shall mean ninety percent (90%) of the Tax Increment, as defined in the Contract, that has been received by the Authority in the six (b) month period preceding a Scheduled Payment Date. Available Tax Increment constitutes a portion of the real property taxes paid with respect to that certain real property described on the attached Exhibit A (hereinafter referred to as the "Property''). The Authority shall pay on each Scheduled Payment Date to the Owner the lesser of (i) the Available Tax Increment; or (ii) the amount remaining ining to be paid under this Note. On the earlier of (i) the date that this Note has been paid in full; or (ii) February 1, 2042, which is the last Scheduled Payment Date, after making the payment due -on such date, the Authority's payment obligations under this Note shall terminate and this Note shall no longer be an obligation of the Authority. All payments made by the Authority shall be applied first to accrued interest and then to the Principal Amount of this Note. The Authority may, at its option, prepay this Note in whole or in part at any time at a price of the outstanding Principal Amount plus accrued and unpaid interest. The Authority's obligations herein are subject to the terms and conditions of the Contract. Upon the occurrence of an Event of Default as provided in Section 9.1 of the Contract, which Contract is incorporated herein and made a part hereof by reference, the Authority's payment obligations hereunder shall be suspended and, upon expiration of all applicable cure periods provided for in Section 9.2 of the Contract, this Note may be terminated by the Authority. Upon such termination, the Authority's obligations to make further payments hereunder shall be discharged. Such termination may be accomplished by the Authority's giving of written notice to the then registered owner of this Note, as shown on the books of the Authority. 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 Available Tax Increment, and then only to the extent and in the manner herein specified. The 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. This Note shall not be transferable or assignable, in whole or in part, by the Owner without the prior written consent of the Authority, which consent shall not be unreasonably withheld. This Note is issued pursuant to Resolution of the Authority and is entitled to the benefits thereof, which resolution is incorporated herein by reference. 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; and that this Note, together with all other indebtedness of the Authority outstanding on the date hereof and on the date of its actual issuance and delivery, does not cause the indebtedness of the Authority to exceed any constitutional or statutory limitation thereon. IN WTTNESS WHEREOF, the New Hope Economic Development Authority, by its Board of Commissioners, has caused this Note to be executed by the manual signatures of the _ and the ^y of the Authority and has caused this Note to be dated 24 EXHIBIT A TO NOTE Description of Property Lot 1, Block 1, Compass Pointe, acccordmg to the recorded plat thereof, Hennepin County, Minnesota. Hennepin County, Minnesota Abstract Property Torrens Certificate No. SCHEDULE C Developer Pro forina 6150=14 J EHLERS 4 •4eeer41e7 leo CRY of mm Hops. Ron Clark DeWopment BB Und Tax Cmft Apa7Dwnr .. %OF TOTAL SOFMARLE -- TWA1!' D VUWER FIMMCM-1stmor"ge 15.70%154M 1,073,060 RFW JX N6-TIFLM 040% 33M 054.000 AX CFEW ED65TY 761/% 70.17% 10,106,/04 7216% 4,777206 000% AAI%IWF FWAN6m ON"% D 00% 14,TM,S® DdwnidbwmbpwFm 000% 161p10 000% 125% 000% TOTAL 8Ot111fb 180AM 060% 1 00 Lok Amussrnn07 Reberon Leen Buy Out ONSTRIM" COSTS Buiigd.�rq hr400�ra Pr.1reN BACJ WACJIIIt C SACA7AC Prk DKNelm emidwe Pmm comnemay Fae4n Cir EsOsys SOFT COWS PROFESSICKAL BEAMRRS:B ArshdodumL Ta 91 Q S PF kIW el Fees SM A Perls Deaeekn6 Eads EA1'6A1011616111 G—W FF/B R%dM R.r..dr NnkWW Appnse6Y Oastc rbik m Lapd-Derdi- FROtMOn COSTS twuaroe Fie Tse knufRtae 1. = d, L"d /oed COW" TR04ee mg"elispsh.I Tes DON Sonde Reewue kdfleel Dum pCwmbudOna F4v"Fee Eumm WHO Cm Tommmmm MWANWLOM ACCRM lXlWSSS REAL ESTATE TA700 COR7810940Y-4% PROASCr YANAe Dfr Denlopw Fee CA/RACCOLMS Ree14nA Enl F11111 Dpendup Rnwwe 61om8emse Stwtrq Teu1 SSS Com $"a 421% 544AN a D0% 6 0 0 a 6167,134 7216% 4,777206 000% 0 D 00% 0 rA 000% 0 000% 0 000% 0 060% o 000% o a 00% a 0 D 00% 0 660% 78aa75 a 00% 0 DAM 0 000% 0 000% 0 Sao% o .OW a aa0s a Sae% a 060% 0 0 503% 040,070 0 12% 15.000 0 0 a coos 0 0 1 0 0 0 a m% 1 0 0 0 0 0 0 071% 1153.00 a a 285% 900.010 0 :1 fAWAM 400.00 3Aapra I Page 1 of 1 Anpned ey W 1 OR Anmbpm 470-14- FINM for PA SCHEDULE D Assessment Agreement ASSESSMENT AGREEMENT and ASSESSOR'S CERTIFICATION By and among NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY, COMPASS POINTE LIMITED PARTNERSHIP, and COUNTY ASSESSOR OF THE COUNTY OF HENNEPIN This document was drafted by: BRADLEY &. DEUCE, P.A. 40] 8 West 65h Street, Suite 100 Edina, Minnesota 55435 THIS AGREEMENT, dated as of this day of , 2014, by and between the New Hope Economic Development Authority, a body politic and corporate (the "Authority") and Compass Pointe Limited Partnership, a Minnesota limited partnership (the "Developer"). WYMSSETH: that: WHEREAS, on or before the date hereof the Authority and the Developer entered into that certain Purchase and Development Agreement (the "Development Agreement") regarding certain real property located in the City of New Hope, hereinafter referred to as the Property and legally described in Exhibit A hereto; and WHEREAS, it is contemplated that pursuant to said Development Agreement the Developer will construct an affordable rental housing development on the Property; and WHEREAS, the Authority and Developer desire to establish a minimum market value for said land and the improvements to be constructed thereon, pursuant to Minnesota Statutes, Section 469.177, Subdivision 8; and WHEREAS, the Authority and the County Assessor for the County of Hennepin have reviewed the preliminary plans and specifications for the improvements which it is contemplated- will ontemplatedwill be erected. NOW, THEREFORE, the parties to this Agreement, in consideration of the promises, covenants and agreements made by each to the other, do hereby agree as follows: 1. Commencing on January 1, 2016, and continuing on each assessment date thereafter until the termination date stated in paragraph 2 below, the minimum market value which shall be assessed for the land described in Exhibit A and the above described improvements shall be not less than Five Million Nine Hundred and Sixteen Thousand Dollars ($5,916,040), notwithstanding incomplete construction of the above described improvements. 2. This Agreement shall terminate in its entirety on the earlier of December 31, 2040; or when the Note, as defined in the Development Agreement, has been paid. 3. This Agreement shall be promptly recorded at the expense of the Developer. 4. Neither the preambles nor provisions of this Agreement are intended to, nor shall they be construed as, modifying the terms of the Development Agreement between the Authority and the Developer. S. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties. NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY By: Its President By: Its Executive Director COMPASS POINTE LIIVIITED PARTNERSHIP By Compass Pointe, LLC, its General Partner By Ronald Clark, its Chief Manager STATE OF MDMSOTA ) ) SS. COUNTY OF ) The foregoing instrument was acknowledged before me this day of 2014, by and 'the President and Executive Director of the New Hope Economic Development Authority, a public body politic and corporate, on behalf of the authority. Notary Public STATE OF MINNESOTA ) ) Ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of, 2014, by Ronald Clark, the Chief Manager of Compass Pointe, LLC, a Minnesota limited liability company, the general partner of of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public CERTIFICATION BY COUNTY ASSESSOR The undersigned, having reviewed the plans and specifications for the improvements to be constructed and the market value assigned to the land upon which the improvements are to be constructed, and being of the opinion that the minimum market value contained in the foregoing Agreement appears reasonable, hereby certif es as follows: The undersigned assessor, being legally responsible for the assessment of the above described property, certifies that the market values assigned to such land and improvements are reasonable. County Assessor for the County of Hennepin STATE OF MINNESOTA) )ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of 2014, by the County Assessor for the County of Hennepin. Notary Public I *Ml Ml_. Legal Description of Land Lot 1, Block 1, Compass Pointe, according to the recorded plat thereof, Hennepin County, Minnesota. Hennepin County, Minnesota Abstract Property Torrens Certificate No. SCHEDULE E QUIT CLAIM DEED THIS INDENTURE, between the City of New Hope, Minnesota, a municipal corporation under the laws of the State of Minnesota (the "Grantor"), and Compass Pointe Limited Partnership, a Minnesota limited partnership (the "Grantee"). WITNESSETH, that Grantor, in consideration of the sum of Three Hundred and Four Thousand Dollars ($304,000.00) and other good and valuable consideration the receipt whereof is hereby acknowledged, does hereby grant, bargain, quitclaim and convey 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, to -wit (such tract or parcel of land is hereinafter referred to as the "Property"): See Exhibit A Attached Hereto To have and to hold the same, together with all the hereditaments and appurtenances thereunto belonging in any wise appertaining, to the said Grantee, its successors and assigns, forever, Provided: SECTION 1. It is understood and agreed that this Deed is subject to the covenants, conditions, restrictions and provisions of an agreement entered into between the New Hope Economic Development Authority (the "Authority') and Grantee on the _ day of , 2014, identified as "Purchase and Development Agreement" (hereafter referred to as the "Agreement") which Agreement is incorporated herein and made a part hereof by reference. This provision, however, shall in no way prevent the Grantee fi-am mortgaging this Property in order to obtain funds for the purchase of Property hereby conveyed and for erecting improvements thereon in conformity with the Agreement, any applicable redevelopment plan and applicable provisions of the Zoning Ordinance of the City of New Hope, Minnesota. It is specifically agreed that the Grantee shall promptly begin and diligently prosecute to completion the redevelopment of the Property through the construction of the improvements thereon, as provided in the Agreement. Promptly after completion of the improvements in accordance with the provisions of the Agreement, the Grantor will cause the Authority to furnish the Grantee with an appropriate instrument so certifying (the "Certificate of Completion'). The Certificate of Completion 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 of the Agreement and of this Deed with respect to the obligation of the Grantee, and its successors and assigns, to construct the improvements and the dates for the beginning and completion thereof The Certificate of Completion and such determination shall not constitute evidence of compliance with or satisfaction of any obligation of the Grantee to any holder of a mortgage, or any insurer of a mortgage, securing money loaned to finance the purchase of the Property hereby conveyed or the improvements, or any part thereof. The Certificate of Completion and any other certifications provided for herein shall be in such form as will enable them to be recorded with the County Recorder, or Registrar of Titles, Hennepin County, Minnesota. If the Authority shall refuse or fail to provide any such certification in accordance with the provisions of the Agreement and this Deed, the Grantor shall, within thirty (30) days after written request by the Grantee, provide the Grantee with a written statement indicating in adequate detail in what respects the Grantee has failed to complete the improvements in accordance with the provisions of the Agreement or is otherwise in default, and what measures or acts it will be necessary, in the opinion of the Grantor, for the Grantee to take or perform in order to obtain such certification. SECTION 2. In the event the Grantee herein shall, prior to the completion of constriction of the improvements under the Agreement as evidenced by the recording of the Certificate of Completion for such unit, hereinabove referred to: (a) Fail to begin construction of the improvements provided for in this Deed and the Agreement in conformity with the Agreement and such failure is not due to unavoidable delays (as defined in the Agreement) and such failure is not cured within one hundred and twenty (120) days after written notice to do so; or (b) Subject to extensions due to Unavoidable Delays, as defined in the Agreement, default in or violate its obligations with respect to the construction of the improvements provided for in this Deed and the Agreement, or shall abandon or substantially suspend construction work, and such default, violation or failure is not due to unavoidable delays (as defined in the Agreement), and any such default or violation, abandonment or suspension shall not be cured, ended or remedied within one hundred twenty (120) days after written demand by the Grantor so to do; or (c) Fail to pay real estate taxes or assessments on the Property or any part thereof when due, or shall place thereon any encumbrance or lien unauthorized by the Agreement with the Grantor, or shall suffer any levy or attachment to be made, or any materialmen's or mechanic's liens, or any other unauthorized encumbrances or liens to attach, and such taxes or assessments shall not have been paid or the encumbrance or lien removed or discharged, or provisions satisfactory to the Grantor made for such payments, removal or discharge, within one hundred twenty (120) days after written demand by the Grantor so to do provided, that if the Grantee shall first notify the Grantor 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 Grantor 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 Grantee provides the Grantor with evidence acceptable to the Grantor that the Grantee's title insurance company will insure over the lien or provides a bank letter of credit in the amount of the lien, in a form satisfactory to the Grantor pursuant to which the bank will pay to the Grantor the amount of any lien in the event that the lien is finally determined to be valid and during the course of such contest the Grantee shall keep the Grantor informed respecting the status of such defense; or (d) Cause in violation of the Agreement or of this Deed, any transfer of the Property or any part thereof that is not approved by the Grantor in accordance with the terms of the Agreement, and such violation shall not be cured within sixty (60) days after written demand by the Grantor to the Grantee; or (e) Fail to comply with any of its covenants under the Agreement and fail to cure any such noncompliance within one hundred twenty (120) days after written demand to do so; or (f) Default under the terms of a mortgage loan authorized by Article VII of the Agreement and the holder of the mortgage exercises any remedy provided by the mortgage documents or exercises any remedy provided by law or equity in the event of a default in any of the terms or conditions of the mortgage and such default is not cured by the later of the applicable notice and cure period of such mortgage or one hundred twenty (120) days after written demand by the Grantor; then the Grantor shall have the right to re -ewer and retake title to and possession of the Property, subject to the liens and encumbrances then of record, and to terminate and revert in the Grantor the estate conveyed by this Deed to the Grantee, its assigns or successors in interest, subject to the terms and conditions of the Agreement, but only if the events stated in Section 2(a) -(f) have not been cured within the time periods provided above, or if the events cannot be cured within such time periods, the Redeveloper does not provide assurances to the Authority, reasonably satisfactory to the Authority, that the events will be cured and will be cured as soon as reasonably possible. The remedies contained in this Section 2 shall not be available to Grantor upon the completion of construction of the Project in accordance with the terms of the Agreement. The investor limited partner of the Grantee (the "Investor Limited Partner") shall have the right, but not the obligation, to cure any of the events stated in Section 2(a) — (f) and the Grantee shall accept performance by the Investor Limited Partner of any obligation of the Grantee hereunder as though tendered by Grantee itself, provided such performance by the Investor Limited Partner has occurred during the applicable cure period, if any, provided to Grantee hereunder with respect to such event or breach or default. SECTION 3. The Grantee agrees for itseit and its successors and assigns to or of the Property or any part thereof, hereinbefore described, that the Grantee and such successors and assigns shall at all times prior to the Termination Date, as defined in the Agreement: (a) Devote the Property to, and only to and in accordance with the uses specified in any applicable redevelopment plan adopted by the Authority as amended and extended, provided that no amendment shall prohibit a pre-existing permitted use; (b) Comply with all of the terms and conditions of the Agreement. It is intended and agreed that the above and foregoing agreements and covenants shall be covenants running with the land, and that they shall, in any event, and without regard to technical classification or designation, legal or otherwise, and except only as otherwise specifically provided in this Deed and the Agreement, be binding, to the fullest extent permitted by law and equity for the benefit and in favor of, and enforceable by, the Grantor and the Authority, their respective successors and assigns, and any successor in interest to the Property, or any part thereof AOS the Grantee, its successors and assigns, and every successor in interest to the Property, or any part thereof or any interest therein, and any party in possession or occupancy of the Property or, any part thereof. In amplification, and not in restriction o% the provisions of the preceding section, it is intended and agreed that the Grantor and its successors and assigns shall be deemed beneficiaries of the agreements and covenants provided herein. - Such agreements and covenants shall run in favor of the Grantor without regard to whether the Grantor has at any time been, remains, or is an owner of any land or interest therein to, or in favor of, which such agreements and covenants relate. The Grantor shall have the right, in the event of any breach of any such agreement or covenant to exercise all the rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breach of agreement or covenant, to which it or any other beneficiaries of such agreement or covenant may be entitled. The covenants and agreements of this Deed and the Agreement shall be enforceable only by Grantor, the Authority, and any public body which is a successor of Grantor or the Authority. SECTION 4. This Deed is also given subject to: (a) Provision of the ordinances, building and zoning laws of the City of New Hope, state and federal laws and regulations in so far as they affect this real estate. (b) Taxes payable subsequent to the date of this conveyance. SECTION 5. The Grantor certifies that the Grantor does not know of any wells on the subject property. IN WITNESS WHEREOF, the Grantor has caused this Deed to be duly executed in its behalf by its President and Executive Director this day of , 2014. CITY OF NEW HOPE By: Its: Mayor By: Its: Manager STATE OF MINNESOTA) )ss. COUNTY OF HENNEPE4) The foregoing instriment was acknowledge before me this day of �� 2014, by and , the Mayor and Manager of the City of New Hope, a statutory city organized and existing under the laws of the state of Minnesota, on behalf of the City. Notary Public This inst Went was drafted by: BRADLEY & DEIKE, P.A. 4018 west 651° Street, Suite 100 Edina., Minnesota 55435. Exhibit A to Quit Claim Deed Description of Property Outlot 1, Mork -Campion Heights, Hennepin County, Minnesota (Totten Property Torrens Cer ficateNo. 1381801) The East 75 Feet of Outlot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota (Abstract Property) The West 75 Feet of the East 150 feet of Outlot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota (Abstract Property) The West 75 Feet of the East 225 feet of Outlot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota (Abstract Property) 9149054v5 SCHEDULE F Interfund Loan Resolution NEW HOPE ECONOMIC DEVELOPNitENT AUTHORITY CITY OF NEW HOPE OWIN COUNTY STATE OF Ml1OMSOTA RESOLUTION NO. „2giA-w RESOLUTION AUTHORIZING AN INTERFUND LOAN FOR ADVANCE OF CERTAIN COSTS IN CONNECTION WITH THE COMPASS POINTE HOUSING TAX INCREMENT FINANCING DISTRICT. BE iT RESOLVED by the Board of Commissioners (the "Board") of the New Hope Economic Development Authority (the "EDA") of the City of New Hope,11Smnesota, as follows: WHEREAS, the City Council for the City of New Hope. N!mawta (the "City', intends to establish the Compass Pointe Housing Tax Increment Financing District (the "TTP District") within Redevelopment Project No. I (the "ProjeW), and will adopt a Tax bucrement Financing Plan (the "11F Plan") for the purpose of financing certain improvements within the Project WHEREAS, the EDA has determined to pay for certain costs identified in the TIF Plan consisting of land/buildiag acquisition, site improvements/preparation, public utilities, streets and sidewalks, interest and administrative costs (collectively, the "Qualified Costs"), which costs may be financed on a temporary basis from EDA funds available for such purposes. WHEREAS, tinder Minnesota Statutes, Section 469.17$, Subd. 7, the EDA is authorized to advance or loan money from the EDA's general fund or any other fund from which such advances may be legally authorized, in order to finance the Qualified Costs. WHEREAS, the EDA owns certain property (tire "EDA Parcels") and has incurred certain costs to prepare such property for redevelopment, including demolition, relocation and site clearance. The EDA has determined that the estimated market value ofthe EDA Parcels is at least $453,281. WHEREAS, the EDA proposes to enter into a Purchase and Development Agreement (the "Development Agreement") with Compass Pointe Limited Partnership (the "Developeel, under which the EDA will (among other things) convey the EDA Parcels to the Developer fbr $304,000. WHEREAS, the EDA also proposes to enter into a Purchase and Development Agreement with the Developer (the 11U Apmemeat"), specifying certain financial assist►ee to Developer in connection with the Development Property. WHEREAS, by conveying the EDA Parcels under the Purchase and Development Agreement, at closing the EDA will forgo receipt of the full market value of the EDA Parcels. Such forbearance represents an advance of EDA funds in the amount of $149,300. WHEREAS, the EDA intends to designate such land advance as an interhmd loan in accordance with the terms of this resolution and the TIF Act (which ternns are referred to collectively as the "Interfund Loan'l. NOW ARE BE IT RESOLVED by the Board as follows: 1. The Authority will reimburse #V in the principal amount of $149,300 toge dw with interest at the rate of 4% per annum (the "latarfimd Loan"). interest accrues on the principal amount from the date of closing on conveyance oftfre EDA Parcels to the Developer unfit the Development Affeement (ham, the "Closing Date"). The maximum rate of interest permitted to be charged is limited to the greater of the rates speer under Minnesota Statutes, Section 2700.40 or Section 549.09 As of the date the lean or advm m is authorized, unleas the written agreement states that the maximum interest rate will fluctuate as the interest rates specified under Mhmesda Statutes, Section 2700.40 or Sedan 549.09 arc firm time to time adjusted. The interest rate shall be 4% and will not fluctuate. 2. Principal and int rest ("Payments") on the hw firnd Loan shall be paid semi-annually on each August I and February i (each a "Payment Date"X cmqmeucing on the first Payment Date on which the HWRA has Available Tax lacreniag (defined below), or on any other dates determined by the Execudvc Director of the EDA, through the dere of last reoeipt of tax increment fmrn the TEF District. 3. Payment on this hdwfund Loan are payable solely Rom °Available Tax hacw=en%" which shall mean, on each Payment Date, tax increment available after other obligations have been paid, or as determined by the City Manager, gencratcd m the preceding six (6) months with respect to the properly within the TEF District and nearitted to the City by Hennepin County, all in aocoftm witb Minnesota Statutes, Sections 469.174 to 469.1799, all innlusim as mated. Payments on this h terfimd Loser may be subordinated to a w outstanding or future bond:, notes or oontracts secured in whole or in part with Available Tax Increnwt, and are on parity with arty other outstanding or f tin a interfund loans secured in whole or in part with Available Tax Incevrnent 4. The principal sum and all accrued iatar,est payable under this hawfimd Loan are pre -payable is whole or in part at any time by the BDA without p+omhtm or penalty. No partial prepayment shall affect the amount or timing of say other regular payment otherwise required to be made under this Interfamd Lose. 5. This lnterf rad Loan is evidence of an internal borrowing by the EDA in accordance with Minneaata Statutes, Section 469.178, Subd. 7, and is a limited obligation payable solely from Available Tax bevement pledged to flue payment hereof under this resolution. This Interfnnd Loan and the interest her+aarr shall not be deemed to constitute, a general obligation of the State of Minnesota or any political subdivision thereof; including. without limitation. tie EDA. Neither the State of Minnesota, nor any political subdivision thereof shall. be obligated to pay the principal of or interest air this lnbmftW Loan or other costs incident hereto except out of Available Tax Increment, and neither the frill faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment of the principal of or interest on this intetfimd Loan or ottani costs incident hereto. The SDA shall have no obligation to pay say principal amount of the I awhind Lon or accrued interest thereon, which may remain unpaid atter liar Sinal Payment Date. 6. The EDA may amend the terms of this Interfimd Loan at any time by resolution of the Baird, including a determination to forgive the outstanding principal amount and accrued interest to the extent permissible under law. Approved by the Board on March . 24 .2014. Daniel e�Presidant PionTem Doc No T05181197 Certified, filed and/or recorded on Jul 1, 2014 2:00 PM Office of the Registrar of Titles Hennepin County, Minnesota Martin McCormick, Registrar of Titles Mark Chapin, County Auditor and Treasurer Deputy 84 Pkg ID 1125705C Doc Name: Development Agreement Document Recording Fee $46.00 Document Tota! $46.00 Existing Certs New Certs 1388516 This cover sheet is now a permanent part of the recorded document. PURCHASE AND DEVELOPMENT AGREEMENT By and Between NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY and COMPASS POINTE LIMITED PARTNERSHIP Dated as of l 2014 This document was drafted by: BRADLEY & DEIKF, P. A. 4018 West 65" Strut, Suite 100 Edina, MN 55435 Telephone: (952) 926-5337 L��'O-fo mercial Partners Title, LLC 200 South Sixth Street Suite 1300 Minneapolis, MN 55402 3iftoa, '3'25j of PREAMBLE Section 1.1 _ Definitions TABLE OF CONTENTS ARTICLE I Definitions ARTICLE II Representations Section 2.1. Representations by the Authority Section 2.2. Representations by the Developer ARTICLE M Authority Assistance: Issu_a_rce of Note 6 6 Section 3.1. Basis for Assistance 8 Section 3.2. Issuance of Note 8 Section 3.3. Conditions Precedent to Issuance of Note 8 Section 3.4. Payment of Administrative Costs 9 Section 3.5. Authority Review of Developer's Costs 9 Section 3.6. Title 9 Section 3.7. Closing; Purchase Price 10 Section 3.8. Conditions Precedent to Conveyance of Authority Property 10 Section 3.9. Advance of Land; Tax Increment Interfimd Loan 10 Section 3.11. Status of Developer Property 11 (i) ARTICLE IV Construction of Im ron yements Section 4.1. Construction of Improvements 12 Section 4.2. Construction Plans 12 Section 4.3. Commencement and Completion of Construction 12 Section 4.4. Certificate of Completion 13 Section 4.5. Management of Improvements 13 Section 4.6. Playground 14 Section 5.1. Insurance Section 5.2. Condemnation ARTICLE V h u a= and Condemnation ARTICLE VI Taxes- Tax Increment 15 16 Section 6.1. Real Property Taxes 18 Section 6.2. Tax Increment 19 Section 6.3. Developer's Representations Concerning Note 19 Section 6.4. Income and Rent Restrictions 24 Section 6.5. Assessment Agreement 21 Section 7.1. Mortgage Financing 22 ARTICLE VIII Prohibitions Against Assignment and Transfer: Indemnification Section g.l . Prohibition Against Transfer of Property and Assignment of Agreement 23 Section 8.2. Release and Indemnification 23 Section 8.3. Environmental Conditions 24 ARTICLE IX Events of Default Section 9.1. Events of Default Defined 25 Section 9.2. Authority's Remedies on Default 25 Section 9.3. No Remedy Exclusive 26 Section 9.4. No Additional Waiver Implied by One Waiver 26 Section 9.5. Costs of Enforcement 26 Section 6.6. The Developer's Option to Terminate 26 Section 6.7. Action to Terminate 26 Section 6.8. Effect of Termination 26 ARTICLE X Additional Provisions Section 10.1. Representatives Not Individually Liable 28 Section 10.2. Restrictions on Use 28 Section 10.3. Titles of Articles and Sections 28 Section 10.4. Notices and Demands 28 Section 10.5. Disclaimer of Relationships 29 Section 10.6. Modifications 29 Section 10.7. Counterparts 29 Section 10.8. Judicial Interpretation 29 Section 10.9. Business Subsidy Act 29 Section 10.10. Termination 29 SCHEDULE A Description of Property SCHEDULE B Note SCHEDULE C Developer Pro forma SCHEDULED Assessment Agreement SCHEDULE E Deed SCHEDULE F Interfund Loan Resolution PURCHASE AND DEVELOPMENT AGREEMENT THIS AGREEMENT, made on or as of the /Qt day of 2014, by and between the New Hope Economic Development Authority, a pub ' bod litic and corporate under the laws of the State of Minnesota (hereinafter referred to as the " inty"), and having its principal office at City Hall, 4401 Xylon Avenue North, New Hope, Minnesota 55428, and Compass Pointe Limited Partnership, a Minnesota limited partnership (hereinafter referred to as the "Developer"), having its principal office at 7500 West 7e Street, Edina, Minnesota 55439. WITNESSETH: WHEREAS, The Authority is a municipal economic development authority organized and existing pursuant to the Constitution and laws of the State of Minnesota and is governed by its Board of Commissioners (the "Board"); and WHEREAS, the Authority and the City of New Hope, Minnesota (the "City") have established within the City Redevelopment Project No. 1 pursuant to Minnesota Staff Sections 469.001 - 469.047, providing for the development and redevelopment of certain areas located within the City (which development district is hereinafter referred to as the "Project'); and WHEREAS, the Authority and the City have further established the Compass Pointe Tax Increment Financing District within the Project pursuant to Minnesota Statutes. Sections 469.174-469.179 (which tax increment financing district is hereinafter referred to as the "Tax Increment District"); and WHEREAS, the Tax Increment District is a housing tax increment financing district intended to provide affordable rental housing for low and moderate income persons and families; and WHEREAS, pursuant to Minnesota Statutes. Section 469.176, subdivision 4, tax increment derived from the Tax Increment District may be used in accordance with the tax increment financing plan created in connection with the establishment of the Tax increment District to pay the public redevelopment costs of the Project; and WHEREAS, the Developer has presented to the Authority a proposal pursuant to which the Developer will acquire certain real property within the Project (which property is hereinafter referred to as the "Property" and is more particularly described in Schedule A annexed hereto and made a part hereof) and construct thereon a 68 -unit residential rental facility; and WHEREAS, a portion of the Property is owned by the City (the "Authority Property") and a portion of the Property is owned by the Developer (the "Developer Property"); and WHEREAS, the City and the Developer have entered into as option agreement (the "Option Agreement") pursuant to which the City has agreed to convey the Authority Property to the Developer; and WHEREAS, the Developer has as a part of its proposal requested that the Authority provide certain financial assistance to aid in its development, without which such development would not be possible; and WHEREAS, Authority believes that the provision of the affordable housing as proposed by the Developer is in the best interest of the City and its residents and in accord with the public purposes and provisions of applicable federal, state and local Iaws under which the Project is being undertaken and assisted; NOW THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: 2 ARTICLE I Definitions Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Act" means Minnesota Statutes. Sections 469.001-469.047, as amended. "Agreement" means this Agreement, as the same may be from time to time modified, amended, or supplemented. "Assessment Agreement" means the agreement in the form attached to this Agreement as Schedule D. "Authority" means the New Hope Economic Development Authority, a public body politic and corporate, its successors and assigns. "Authority Property" means the property described as such on the attached Schedule A. "Available Tax Increment" means, with respect to a Scheduled Payment Date, as defined in the Note, ninety percent (90%) of the Tax Increment received by the Authority in the six (6) month period preceding such Scheduled Payment Date. `Board" means the Authority's Board of Commissioners. "City" means the City of New Hope, Minnesota "Construction Plans" means the site plan, utility plan, grading and drainage plan, landscape plan, elevations drawings and related documents on the constriction work to be performed by the Developer on the Property which have been or will be submitted for approval by the Board, together with the resolution of the Board approving such plans and the plans, specifications, drawings and related documents on the construction work to be performed by the Developer on the Property which are to be submitted to the building inspector of the City. "County" means Hennepin County, Minnesota "Deed" means the deed in the form of Schedule E attached hereto. "Developer" means Compass Pointe Limited Partnership, a Minnesota limited partnership, its successors and assigns and any future owner of any right, title or interest in the Properly. "Developer Property" means the property described as such on the attached Schedule A. "Event of Default" means an action by the Developer listed in Article IX of this Agreement. "Improvements" means the improvements to be constructed by the Developer on the Property, consisting of the construction of a 6$ unit rental housing development together with parking and other incidental and related improvements in accordance with the approved Construction Plans. "Minimum Market Value" means the market value for tax purposes of the Property and Improvements established by the Assessment Agreement. "Net Proceeds" means any proceeds paid by an insurer to the Developer or the Authority under a policy or policies of insurance required to be provided and maintained by the Developer pursuant to Article V of this Agreement and remaining aft deducting all expenses (including fees and disbursements of counsel) incurred in the collection of such proceeds. "Note" means the Taxable Limited Revenue Tax Increment Note to be issued by the Authority pursuant to Section 3.2 of this Agreement, which Note shall be substantially in the form of the Note attached to this Agreement as Schedule B. "Option Agreement" means that certain Option Agreement by and between the City and the Developer dated as of June 4, 2012, as amended as of the date hereof. "Permitted Encumbrances" means the provisions of the Deed and this Agreement: reservations of minerals or mineral rights to the State of Minnesota; public utility, roadway and other easements which will not adversely affect the development and use of the Authority Property pursuant to the Developer's Construction Plans; building laws, regulations and ordinances consistent with the Improvements; restrictions, covenants and easements of record that do not materially adversely affect the development and use of the Improvements and are reasonably acceptable to the Developer; and exceptions to title to the Authority Property which are not objected to by Developer upon examination of the title evidence delivered to the Developer pursuant to the terms of the Option Agreement. "Project" means the Authority's Redevelopment Project No. 1. "Project Area" means the real property located within the boundaries of the Project. "Project Plan" means the redevelopment plan adopted in connection with creation of the Project. "Property" means the real property described as such on the attached Schedule A, consisting of the Authority Property and the Developer Property. "Reimbursable Costs" means the costs to be reimbursed by the Authority to the Developer as described in Article III of this Agreement, which costs consist of the cost of constructing the Improvements. "State" means the State of Minnesota. "Tax Increment" means that portion of the real property taxes paid with respect to the Property and Improvements that is remitted to the Authority as tax increment pursuant to the Tax Increment Act, minus deductions required by law. "Tax Increment Act" means the Tax Increment Financing Act, Minnesota Statutes. Sections 469.174469.1794, as amended and as it may be further amended from time to time. "Tax Increment District" means the Compass Pointe Tax Increment Financing District created by the Authority within the Project Area. "Tax Increment Plan' means the tax increment financing plan adopted by the Authority in connection with its creation of the Tax Increment District, which plan together with the information and findings contained therein is hereby incorporated herein and made a part hereof by reference. "Termination Date" means the latest of the following dates: (i) the date that the Note is paid in full or terminated; (ii) the date that this Agreement is terminated; or (iii) the date that the Interfund Loan described in Section 3.9(b) has been paid in full. "Unavoidable Delays" means delays which are the direct result of acts of God, unforeseen adverse weather conditions, strikes, other labor troubles, fire or other casualty to the Improvements, litigation commenced by third parties which, by injunction or other similar judicial action, directly results in delays, or acts of any federal, state or local governmental unit, and which directly results in delays. ARTICLE II Representations Section 2.1. Representations by the Authority. The Authority makes the following representations as the basis for the undertaking on its part herein contained: (a) The Authority is a municipal economic development authority organized and existing under the laws of the State. Under the laws of the State, the Authority has the power to enter into this Agreement and to perform its obligations hereunder. (b) The Authority will cooperate with the Developer with respect to any litigation commenced with respect to the Project Plan, Project, or Improvements and in the Developer's acquisition of any permits or other approvals required in connection with the construction of the Improvements. (c) The Authority has received no notice or communication from any local., state or federal official that the activities of the Developer or the Authority in the Project Area may be or will be in violation of any environmental law or regulation. The Authority is aware of no facts the existence of which would cause it or any portion of the Authority Property to be in violation of any local, state or federal environmental law, regulation or review procedure. (d) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions or provisions of any restriction or any evidences of indebtedness, agreement or instrument of whatever nature to which the Authority is now a party or by which it is bound, or constitutes a default under any of the foregoing (e) To the best of the Authority's knowledge, there is no litigation, pending or threatened, regarding the Authority Property or challenging the validity of this Agreement. (fl The Authority will not issue any further obligations that are payable from or secured by the Available Tax Increment prior to the date that the Note has been paid in full, or terminated in accordance with its terms, without the prior written consent of the Developer. Section 2.2. Re resentations by the Developff. The Developer represents that: (a) The Developer is a limited partnership duly organized and authorized to transact business in the State, is not in violation of any provisions of its articles of partnership agreement or the laws of the State, has power to enter into this Agreement and has duly authorized the execution, delivery and performance of this Agreement by proper action of its board of general partners. (b) The Developer will construct the Improvements in accordance with the terms of this Agreement and all local, state and federal laws and regulations (including, but not limited to, environmental, zoning, building code and public health laws and regulations), except for variances necessary to construct the improvements contemplated in the Construction Plans approved by the Authority. (c) The Developer has received no notice or communication from any local, state or federal official that the activities of the Developer or the Authority in the Project Area may be or will be in violation of any environmental law or regulation. The Developer is aware of no facts the existence of which would cause it to be in violation of any local, state or federal environmental law, regulation or review procedure. In the event that it is necessary to take any action to obtain any necessary permits or approvals with respect to the Property under any local, state or federal environmental law or regulation, the Developer will be responsible for taking such action. (d) The Developer will obtain, in a timely manner, all required permits, licenses and approvals, and will meet, in a timely manner, all requirements of all applicable local, state and federal laws and regulations which must be obtained or met before the Improvements may be lawfully constructed. (e) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions or provisions of any restriction or any evidences of indebtedness, agreement or instrument of whatever nature to which the Developer is now a party or by which it is bound, or constitutes a default under any of the foregoing. (f) The Developer will cooperate with the Authority with respect to any litigation commenced with respect to the Project Plata, Project, or Improvements. (g) The Developer could not and would not proceed with the construction of the Improvements absent the financial assistance being provided by the Authority pursuant to this Agreement. ARTICLE Ilii Authop:jy Assistance; Issuance of Note Section 3.1. Basis for Assistance. The Authority believes that there is currently a shortage of affordable rental housing for low and moderate income persons within the City. Therefore, the Authority has determined that it is in the vital interests of the City and its residents that additional affordable housing be provided and that such housing will not be provided without the financial participation of the Authority as proposed by the Developer. In consideration of the Developer's agreement to undertake the development of the Improvements, its agreement to construct as a part of the Improvements certain amenities that the Authority deems necessary and desirable, and its covenants concerning tenant incomes, the Authority is willing to cause the City to convey the Authority Property to the Developer and to defray a portion of the Developer's costs of construction of the Improvements through the issuance and the payment of the Note. Section 3.2. Issuance of Note. The Authority agrees to defray a portion of the Developer's cost of constructing the Improvements through the issuance of the Note. The costs to be reimbursed by the Authority through the issuance of the Note are referred to herein as the "Reimbursable Costs". The Reimbursable Costs consist of a portion of the cost of constructing the Improvements. The issuance of the Note shall occur when the conditions set forth in Section 3.3 have been satisfied. The principal amount of the Note will be equal to the Developer's actual Reimbursable Costs incurred and paid by the Developer, but in no event to exceed $684,254. If the Developer's documented Reimbursable Costs for such items are less than $684,250 then the .amount of the Note shall be such lesser amount. The Note shall be in the form of the Note attached to this Agreement as Schedule B, with all blanks properly completed. interest at the rate of five and one half percent (5.5'/o) shall accrue on the principal amount of the Note from the date of its issuance up to February 1, 2016, and shall be added to the principal amount of the Note on the first day of each February and August after its issuance up to and including February 1, 2016. From and after February 1, 2016, until the Note is terminated or paid in fiull,supple non -compounding interest at the rate of five and one half percent (5.5%) shall accrue with respect to the principal amount of the Note. Section 3.3. Conditions Precedent to Issuance of Note. Notwithstanding anything to the contrary contained herein, the Authority's obligation to issue the Note shall be subject to satisfaction, or waiver in writing by the Authority, of all of the following conditions precedent: (a) the Developer shall not be in default under the terms of this Agreement; (b) the Developer shall have closed on financing sufficient to pay all costs to be incurred in connection with the acquisition and constriction of the Improvements; (c) the Developer shall have paid the Reimbursable Costs as described in Section 3.2 of this Agreement and shall have provided to the Authority such documentation of such costs as the Authority shall reasonably request; and (d) the Developer shall have completed construction of the Improvements and the Authority shall have completed the financial analysis provided for in Section 3.5 of this Agreement. Section 3.4. Payment of Administrative Costs. Except for any costs required to be paid by the City pursuant to the Option Agreement, the Developer will reimburse the Authority for all out-of-pocket costs incurred by the Au4iorhy in connection with review and analysis of the development proposed under this Agreement, development of the Tax Increment Plan for the Tax hwrement District; and negotiation of this Agreement and any related agreements and documents (collectively, the "Administrative Costs"). The Administrative Costs include fees paid to attorneys, the Authority's financial advisor, and any planning and engineering consultants retained by the Authority or City in connection with the construction of the Improvements. As security for the Administrative Costs, the Developer deposited with the Authority the amount of $10,000, and the Authority shall pay the Administrative Costs from such funds. If the total Administrative Costs exceed $10,000, the Developer remains responsible for such excess costs, and must pay such costs to the Authority within 10 days after receipt of a written invoice from the Authority describing the amount and nature of the costs to be reimbursed. After the Note has been issued and the certificate of completion referenced in Section 4.4 has been executed and delivered, and all the Administrative Costs related to such actions have been paid, the Authority will refund to the Developer any portion of the balance from the $10,000 deposit (if any) that is not needed to cover the Administrative Costs through such reimbursement dato. Notwithstanding anything to the contrary herein, the Developer remains obligated to pay the Administrative Costs after issuance of such certificate of completion, including the costs of any amendments to this Agreement or to the Note. Section 3.5. Authority Review of Developer's Costs. The Authority's determination to issue the Note to the Developer is based on the Developer's representations regarding its costs of constructing the Improvements. Based on those representations the Authority has determined that reimbursement of the Developer through the issuance of the Note for the Reimbursable Costs is necessary to assist in making the construction and ownership of the Improvements financially feasible. Attached to this Agreement as Schedule C is a financial pro forma provided to the Authority by the Developer setting forth the Developer's anticipated costs associated with the acquisition of the Property and construction of the Improvements. Within thirty (30) days after the Developer's completion of construction of the Improvements and payment of all costs associated with such construction, the Developer shall fimush to the Authority an updated pro forma showing the Developer's actual costs incurred in connection with the construction of the Improvements, together with such supporting documentation as the Authority may require. If such updated pro forma shows that the Developer's total costs of acquiring the Property and constructing the Improvements is less than the amount shown on the pro forma attached hereto as Schedule C, the principal amount of the Note to be issued pursuant to Section 3.2 shall be reduced by $.50 for each $1.00 that the Developer's actual costs are less than the amount estimated as shown on Schedule C. Section 3.6. Title. Submission of evidence of title to the Authority Property and Developer's review of title shall occur in accordance with the terms of the Option Agreement.. Section 3.7. Closin—a: Purchase Price. (a) Closing on the conveyance of the Authority Property to the Developer shall occur on such date that the conditions precedent contained in Section 3.8 have been satisfied or waived. (b) At the closing on the conveyance of the Authority Property the Authority shall cause the City to deliver to the Developer: (i) a Deed duly executed and acknowledged conveying to the Developer marketable title to the Authority Property subject only to Permitted Encumbrances; and (ii) such other documents as are required to be delivered pursuant to the terms of the Option Agreement. (c) Closing costs associated with the conveyance of the Authority Property will be allocated as provided in the Option Agreement. (d) The purchase price to be paid by the Developer to acquire the Authority Property shall be $304,000 and shall be payable at closing. Section 3.8. Conditions Pywedent to Qggvevance of the Autho . Pro The Authority's obligation to cause the City to sell and the Developer's obligation to purchase the Authority Property shall be subject to satisfaction of the following conditions precedent: (a) The Developer having secured financing or provided to the Authority evidence reasonably satisfactory to the Authority of its ability to secure financing sufficient for the acquisition of the Property and the construction of the Improvements. (b) The Developer having reviewed and approved, or waived any objections to, title to the Authority Property pursuant to Section 3.6 of this Agreement. (c) The Developer having secured the Authority's approval of the Construction Plans and all other governmental approvals necessary to permit the construction and operation of the Improvements. (d) The Developer shall have acquired the Developer Property. (e) The Developer and the City shall be in compliance with the terms of the Option Agreement" If all of the conditions precedent to the conveyance of the Authority Property have not been satisfied by July 1, 2014, the Authority shall have the right to terminate this Agreement by giving written notice of termination to the Developer, upon which this Agreement shall terminate and the Authority and Developer shall execute an instrument in recordable form evidencing such termination. Section 3.9. Advance of Land: Tax Increment Interfund Loan. (a) The City has acquired the Authority Property and the City and the Authority have incurred certain costs to prepare such property for redevelopment, including payment of relocation costs, environmental remediation, demolition of buildings and site clearance. After Developer's payment of the 10 purchase price for the Authority Property there will remain unreimbursed costs incurred by the City and the Authority in the approximate amount of $149,300 (the "City Costs"). Subject to all the terms and conditions of this Agreement, upon the conveyance of the Authority Property to the Developer, the City and the Authority will forego receipt of the City Costs and the City Costs will remain outstanding. The City and the Authority shall reserve the right to collect such City Costs through the Interfimd Loan, as described in Section 3.9(b) below. (b) The Authority will treat the amount of the City Costs as an interfund loan (the "Interfimd LoaW) within the meaning of Section 469.178, Subdivision 7 of the Tax Increment Act. The terms of the Interfimd Loan are described in the resolution attached as Schedule F (the "Loan Resolution" }. Until the Note has been paid in full, or terminated in accordance with its terms, the InterRind Loan will be payable only from Tax Increment received by the Authority that is in excess of Available Tax Increment Section 3.10. Status of Developer Property. The Developer Property consists of the real property described as such on Schedule A attached hereto. As of the date of this Agreement, the Developer has entered into a purchase agreement to acquire the Developer Property for $240,000. I ARTICLE IV Construction of bu rovements Section 4.1. Construction of improvements. The Developer agrees that it will construct the improvements on the Property in material accordance with the approved Construction Plans and at all times prior to the Termination Date will operate and maintain, preserve and keep the improvements or cause the Improvements to be maintained, preserved and kept with the appurtenances and every part and parcel thereof, in good repair and condition. "Material accordance" with the Construction Plans, for purposes of this Agreement, shall mean without a "material change" from the Constriction Plans, as defined in Section 4.2(b). Section 4.2. Construction Plans. (a) The Developer has submitted and the City and the Authority have approved a site plan for the construction of the Improvements (the "Site Plan"). All Construction Plans for the Improvements shall be consistent with the approved Site Plan. The Construction Plains shall provide for the construction of the Improvements and shall be in conformity with this Agreement, the Site Plan approved by the Authority, and all applicable state and local laws and regulations. The Authority shall approve the Construction Plans in writing if, in the reasonable discretion of the Authority: (i) the Construction Plans conform to the terms and conditions of this Agreement; (ii) the Construction Plans are consistent with the Site Plans previously submitted to the Authority; (iii) the Construction Plans conform to all applicable federal, State and local law, ordinances, rules and regulations; (iv) the Construction Plans are adequate to provide for the construction of the Improvements; (v) the Construction Plans do not provide for expenditures in excess of the fiends which will be available to the Developer for the construction of the Improvements; and (vi) no Event of Default has occurred. No approval by the Authority under this Section 4.2 shall relieve the Developer of the obligation to comply with the terms of this Agreement or applicable federal, state and local laws, ordinances, rules and regulations, or to construct the Improvements. No approval by the Authority shall constitute a waiver of an Event of Default. Such Construction Plans shall, in any event, be deemed approved unless rejected in writing by the Authority, in whole or in part. Such rejection shall set forth in detail the reasons therefor, and shall be made within thirty (30) days after the date of their receipt by the Authority. The provisions of this Section relating to approval, rejection and resubmission of corrected Construction Plans shall continue to apply until the Construction Plans have been approved by the Authority or until this Agreement is terminated. The Authority's approval shall not be unreasonably withheld. Notwithstanding any other provisions of this Agreement, the issuance by the City of a building permit fox the Project shall constitute the approval of the Construction Plans by the City and the Authority as provided herein. (b) If the Developer desires to make any material change in any Construction Plans after their approval by the Authority, the Developer shall submit the proposed change to the Authority for its approval. For purposes of this Agreement, a "material change" means a change that changes the size, nature or exterior appearance of the Improvements or that reduces the value of the Improvements. If the Construction Plans, as modified by the proposed change, conform to the requirements of this Section 4.2 of this Agreement with respect to such previously approved Construction Pians, the Authority shall approve the proposed change and 12 notify the Developer in writing of its approval. Any requested change in the Construction Plans shall, in any event, be deemed approved by the Authority unless rejected, in whole or in part, by written notice by the Authority to the Developer, setting forth in detail the reasons therefor. Such rejection shall be made within ten (10) days after receipt of the notice of such change. Section 4.3. Commencement and Completion of Construction. {a} Subject to Unavoidable Delays, the Developer shall commence construction of the Improvements by September 1, 2014, or on such other date as the parties shall mutually agree. Subject to Unavoidable Delays, the Developer shall complete the construction of the Improvements by December 31, 2015. All work with respect to the Improvements to be constructed or provided by the Developer on the Property shall be in conformity with the Construction Plans as submitted by the Developer and approved by the Authority. (b) Until construction, of the Improvements has been completed, the Developer shall make construction progress reports, at such times as may reasonably be requested by the Authority, but not more than once a month, as to the actual progress of the Developer with respect to such construction. Section 4.4. Certificate_ of CQaroletion. (a) Promptly after completion of the Improvements in accordance with those provisions of this Agreement relating solely to the obligations of the Developer to construct the Improvements, and upon request by the Developer, the Authority will furnish the Developer with a Certificate of Completion for the improvements in a forms acceptable for recording in the County Recorder's Office or the Office of the Registrar of Titles. The Certificate of Completion shall be funnished to the Developer within ten (10) business day atter request by the Developer, and shall conclusively satisfy and terminate the agreements and covenants in this Agreement and in the Deed of the Developer, and its successors and assigns, to construct the Improvements. Such certification and such determination shall not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any Holder of a Mortgage, or any insurer of a Mortgage, securing money loaned for construction of the Minimum Improvements, or any part thereof. (b) If the Authority shall refuse or fail to provide a Certificate of Completion in accordance with the provisions of this Section 4.4 of this Agreement, the Authority shall, within ten (10) business day after written request by the Developer for the Certificate of Completion, provide the Developer with a written statement, indicating in adequate detail in what respects the Developer has failed to complete the Improvements in accordance with the provisions of this Agreement and what measures or acts will be necessary, in the opinion of the Authority, for the Developer to take or perform in order to obtain the Certificate of Completion (c) The construction of the Improvements shall be deemed to be completed when the City has issued a final certificate of occupancy for the Improvements (or when the Developer would be entitled to a certificate of occupancy if it requested one), and when all conditions imposed in connection with the City's approval of the Developer's development, including the establishment of any completion escrow, if necessary, have been satisfied. 13 Section 4.5. Magement of Improvements. The Developer shalt at all times either self-manage (upon submission of evidence of experience in operating multifamily residential developments) or engage Steven Scott Management or another properly management company with substantial experience in operating multifamily residential developments, subject to approval by the Authority, which approval will not be unreasonably withheld. The Developer will submit evidence of such management by February 1, 2016. Section 4.6. Playground. The Developer shall construct the playground portion of the Improvements (the "Playground") in conformity with the planned unit development approved by the City for the Property and Improvements and the approved Site Plan for the use and enjoyment of residents and invitees of the Improvements. The Playground shall incorporate amenities described in Developer's site plan approved by the City. The parties agree and . understand that the Developer shall be responsible for the cost of the maintenance and operation of the Playground. 14 ARTICLE V Insurance and Condemnation Section 5.1. Insurance. (a) The Developer will provide and maintain at all times during the process of constructing the Improvements and, from time to time at the request of the Authority, furnish the Authority with proof of payment of premiums on: (i) Builder's risk insurance, written on the so-called "Builder's Risk -- Completed Value Basis," in an amount equal to one hundred percent (100%) of the insurable value of the Improvements at the date of completion, and with coverage available in nonteporting form on the so called "all risk" form of policy; (ii) Comprehensive general liability insurance (including operations, contingent liability, operations of subcontractors, completed operations, Broadening Endorsement including contractual 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 ocaurence (to accomplish the above -required limits, an umbrella excess liability policy may be used); and (iii) Worker's compensation insurance, with statutory coverage and employer's liability protection. The policies of insurance required pursuant to clauses (i) and (ii) above shall be in form and content satisfactory to the Authority and shall be placed with financially sound and reputable insurers licensed to transact business in the State, the liability insurer to be rated A or better in Best's Insurance Guide. The policy of insurance delivered pursuant to clause (i) above shall contain an agreement of the insurer to give not less than thirty (3 0) days' advance written notice to the Authority in the event of cancellation of such policy or change affecting the coverage thereunder. . (b) Upon completion of construction of the Improvements and prior to the Tmnination Date, the Developer 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 Improvements 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, all risk 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 the Improvements, but any such policy may have a deductible amount of not more than $10,000. 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 - 15 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 Improvements (excluding foundation and excavation costs and costs of underground flues, pipes, drains and other uninsurable items) and equipment, and shall be determined from time to time at the request of the Authority, but not more frequently than once every three years, by an insurance consultant or insurer, selected and paid for by the Developer and approved by the Authority. (ii) Comprehensive general public liability insurance, including personal injury liability (with employee exclusion deleted), and automobile insurance, including owned, non -owned and hired automobiles, 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. (iii) Such other insurance, including worker's compensation insurance respecting all employees of the Developer, if any, in such amount as is.customarily carried by like organizations engaged in like activities of comparable size and liability exposure; provided that the Developer may be self-insured with respect to all or any part of its liability for worker's compensation. (c) All insurance required in Article V of this Agreement shall be taken out and maintained in responsible insurance companies selected by the Developer which are authorized under the laws of the State to assume the risks covered thereby. . (d) The Developer agrees to notify the Authority immediately in the case of damage exceeding $100,000 in amount to, or destruction of, the Improvements or any portion thereof resulting from fire or other casualty. In the event of any such damage, the Developer will forthwith repair, reconstruct and restore the Improvements to substantially the same or an improved condition or value as existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restoration, but subject to the rights of Developer's lenders, the Developer will apply the proceeds of any insurance relating to such damage received by the Developer to the payment or reimbursement of the costs thereof The Developer shall complete the repair, reconstruction and restoration of the Improvements, whether or not the Net Proceeds of insurance received by the Developer for such purposes are sufficient to pay for the same: Any proceeds remaining alter completion of such repairs, construction and restoration shall be retained by the Developer. If the Developer fails to fulfill its obligations to repair, reconstruct and restore the Improvements within a reasonable time after the occurrence of the damage, the Authority shall be entitled, as its only remedy on account thereof, to terminate the Note. Section 5.2. Condemnation. In the event that title to and possession of the Improvements or any material part thereof shall be taken in condemnation or by the exercise of the power of eminent domain by any governmental body or other person prior to the Termination Date, the Developer shall, with reasonable promptness after such taking, notify the Authority as to the nature and extent of such taking. Upon receipt of any condemnation award, but subject to the 16 rights of Developer's tenders, the Developer shall elect to either: (a) use the entire condemnation award to reconstruct the Improvernents (or, in the event only a part of Improvements have been taken, then to reconstruct such part) within the Project Area; or (b) retain the condemnation award whereupon in the event that a substantial portion of the Property and Improvements have been taken, the Authoritys obligations under the Note shall terminate as of the date of the taking. 17 ARTICLE VI Taxes; Tax Increment; Assessment Agreement Section 6.1. Real PrT pg1y Taxes. The Developer shall pay or cause to be paid when due and prior to the imposition of penalty all real property taxes and installments of special assessments payable with respect to the Property atter the Developer acquires the Property. In addition, the Developer agrees that prior to the Termination Date: (1) it will not seek administrative or judicial review of the applicability of any tax statute determined by any Tax Official to be applicable to the Improvements or the Property or raise the inapplicability of any such tax statute as a defense in any proceedings, including delinquent tax proceedings; (2) it will not seek administrative or judicial review of the constitutionality of any tax statute determined by any tax official to be applicable to the Improvements or the Property or raise the unconstitutionality of any such tax statute as a defense in any proceedings, including delinquent tax proceedings; and (3) it will not cause a reduction in the Minimum Market Value of the Improvements through: (a) willful destruction of the Improvements or any part thereof; (b) willful refusal to reconstruct damaged or destroyed property pursuant to Section 5.1(d) of this Agreement; (c) a request to the County assessor to reduce the assessed value of the Property below the Minimum Market Value of all or any portion of the Property or Improvements; (d) a petition to the board of equalization of the County to reduce the assessed value of the Property below the Minimum Market Value; (e) a petition to the board of equalization of the State or the commissioner of revenue of the State to reduce the assessed value of the Property below the Minimum Market Value; (f) an action in a district court of the State or the tax court of the State seeking a reduction in the assessed value of the Property below the Minimum Market Value; (g) an application to the commissioner of revenue of the State or to any local taxing jurisdiction requesting an abatement of real property taxes regarding the Property or Improvements; (h) any other proceedings, whether administrative, legal or equitable, with any administrative body within the County or the State or with any court of the State or the federal government regarding a reduction in the assessed value of the Property below the Minimum Market Value; or (i) a transfer of the Property or Improvements, or any part thereof, to an entity exempt from the payment of real property taxes under State law. is Notwithstanding anything contained in this Section 6.1 or elsewhere in this Agreement to the contrary, the Developer may contest real property taxes assessed in excess of the Minimum Market Value of the Improvements. The Developer shall notify the City and Authority of any administrative or judicial review affecting the Improvements or the Property. In such event, the Authority will continue to make payments under the Note to the Developer based upon the value stated in the Assessment Agreement, with any additional Tax Increment available for payment being withheld from Developer until such time that the administrative or judicial review affecting the Improvements or the Property is finally determined. The Developer shall not, prior to the Termination Date, apply to any taxing jurisdiction for a deferral or abatement of property tax on the Property or Improvements. The parties hereto acknowledge that Developer intends to apply to have the Property certified as low-income rental housing property as described in Minnesota Stattrttes, Section 273.13, Subdivision 25(e). Nothing set forth in this Agreement shall restrict Developer from applying to have the Property certified as low-income rental housing property as described in Minnesota Statutes, Section 273.13, Subdivision 25(e). Section 6.2. Tax Increment Subject to the limitations contained in the Note, the Authority hereby pledges to the payment of the Note the Available Tax Increment. Tax Increment received by the Authority in excess of Available Tax Increment shall be the Authority's property and, the Authority shall be free to use such excess Tax Increment for any purpose for which such Tax Increment may be used under the Tax Increment Act. Section 6.3. Developer's,epectations Concern Note. The Developer makes the following representations to the Authority with respect to the issuance of the Note: (a) The Developer has not relied on any representations of the Authority, or any of its officers, agents, or employees, and has not relied on any opinion of any attorney of the Authority, as to the federal or State income tax consequences relating to the ownership of the Note by the Developer. (b) The Developer is sufficiently knowledgeable and experienced in financial and business matters, including the purchase and ownership of obligations of a nature similar to the Note, to be able to evaluate the risks and merits of the purchase and ownership of the Note. The Developer has been made aware of the security for the Note and the proposed uses of the proceeds of the Note, and has received the cooperation of the Authority in undertaking any due diligence that the Developer has deemed necessary or appropriate. (c) The Developer understands that the portion of the Tax Increment pledged to the payment of the Note pursuant to this Agreement is the sole source of money that is pledged and will be available for the payments due under the Note; that the Authority is not under any obligation to repurchase the Note from the Developer under any circumstances; that the Note is not a general obligation of the Authority; and that, if the Tax Increment pledged to the payment of the Note pursuant to this Agreement is not sufficient to make the payments due tinder the Note in full, no right will exist to have taxes levied by the Authority or the City for the payment of the unpaid amounts due under the Note. 19 (d) The Developer understands that the Tax Increment necessary to pay the Note has been estimated assuming that the Improvements will have certain market values on certain dates. All estimates of Tax Increment that have been prepared by or on behalf of the Authority have been done for the Authority's use only and neither the Authority nor its consultants shall have liability to the Developer if the actual Tax Increment is less than the amounts estimated. In the event, among other things, the Developer fails to complete the Improvements in a tamely manner or the market value of the Improvements does not reach certain levels, the Tax Increment pledged to the payment of the Note may be inadequate to pay the total principal of and interest on the Note. (e) The Developer understands that the Note is not registered or otherwise qualified for sale or transfer under the securities lavas and regulations of the State or under federal securities laws or regulations, the Note is not listed on any stock or other securities exchange, and the Note will carry no rating from any rating service. Except as provided herein, the Note may not be transferred to any third party without the prior written approval of the Authority. The Authority hereby approves the transfer of the Note by the Developer to the Minnesota Housing Finance Agency C MHFA'D as part of the permanent financing for the Project. Any transferee of a Note shall be required to execute an instrument malting the representations to the Authority contained in this Section; provided, that such requirement shall not apply to a transfer or assignment of the Note to the NWA. Section 6.4. income Restrictions. (a) The Authority and the Developer understand and agree that the Tax Increment District is a "housing district" under Section 469.174, Subd. 11 of the Tax Increment Act. Accordingly, in compliance with Section 469.1761, Subd. 3 of the Tax Increment Act, the Developer agrees that the Improvements must satisfy, or be treated as satitsffing, the income requirements for a qualified residential rental project as defined in Section 142(d) of the Internal Revenue Code. The parties finther agree that no more than 20% of the square footage of the Improvements (which is the only building receiving assistance from Tax Increments) may consist of commercial, retail, or other nonresidential uses. The Developer must meet the above requirements as follows: (i) At least 40% of the residential units in the Improvements must be occupied or available for occupancy by persons whose incomes do not exceed 60% of the County area median income; and (ii) The limits described in clause (A) must be satisfied through the Termination Date. Income for occupants of units described in clause (A) shall be adjusted for family size in accordance with Section 142(d) of the Internal Revenue Code and related regulations. (b) On or before each January 1, commencing on January 1, 2016, the Developer or an agent of the Developer must deliver or cause to be delivered to the Authority a Compliance Certificate executed by the Developer covering the preceding six months together with written evidence satisfactory to the Authority of compliance with the covenants in this Section. This evidence must include a statement of the household income of each of qualifying renter, a 20 written determination that each qualifying renter's household income falls within the qualifying limits of this Section (and Section 142(d) of the Internal Revenue Code), and certification that the income documentation is correct and accurate (and that the determination of qualification was made in compliance with Section 142(d) of the Internal Revenue Code). The Authority may review, upon request, all documentation supporting the Developer submissions and statements. In determining compliance with this Section., the Developer must use the County median incomes for the year in which the payment is due on the Note, as promulgated by the Minnesota Housing Finance Agency based on the area median incomes established by the United States Department of Housing and Urban Development (c) In the event that there occurs a failure on the part of the Developer to comply with the restrictions contained in the Tax Increment Act or this Section 6.4 that results in liability on the part of the Authority or City for repayment of Tax Increment or penalties, the Developer shall be liable to the Authority and on demand shall pay to the Authority the amount of any liability. Without limiting any other remedy available to the Authority, the Authority shall be entitled to specifically enforce the Developer's covenants under this Section. (d) The income restrictions contained in this Section 6.4 shall apply to the Improvements until the Termination Date, notwithstanding the earlier termination of this Agreement or the Note. Section 6.5. Assessment Aareement. (a) Upon commencement of construction of the Improvements, the Developer shall, with the Authority, execute an Assessment Agreement pursuant to Minnesota Statutes, Section 469.177, subd. 8, specifying an assessor's Minimum Market Value for the Improvements. The amount of the minimum Market Value of the Improvements shall be $5,916,000 as of January 2, 2016 and each January 2 thereafter, notwithstanding the status of construction by such dates. (b) The Assessment Agreement shall be substantially in the form attached as Schedule D. Nothing in the Assessment Agreements shall limit the discretion of the assessor to assign a market value to the property in excess of such Minimum Market Value, The Assessment Amt shall remain in force for the period specified in the Assessment Agreement.. 21 ARTYCLE VII MoEigage Financin Section 7.1. Mortgage Financing. On or before June 1, 2014, the Developer shall provide to the Authority evidence of a commitment for mortgage financing sufficient for construction of the Improvements. If the Authority finds that the mortgage financing is sufficiently committed, adequate in amount to provide for the construction of the Improvements, and subject only to such conditions as the Authority approves, then the Authority shall notify the Developer in writing of its approval. Such approval shall not be unreasonably withheld and either approval or rejection shall be given within fourteen (14) days from the date when the Authority is provided the evidence of mortgage financing. The issuance of a building permit for the Improvements by the City shall be deemed to evidence the Authority's approval under this Section. If the Authority rejects the evidence of mortgage financing as inadequate, it shall do so in writing specifying the basis for the rejection. In any event, the Developer shall submit adequate evidence of mortgage financing within thirty (30) days after such rejection. Notwithstanding the foregoing, the Authority acknowledges receipt from the Developer of the commitment for mortgage financing as described above and acknowledges that such commitment has been approved by the Authority. 22 ARTICLE VIII Prohibitions Against As ' ment and Transfer Indemnification Section 8.1. Prohibition Against Transfer of EMRM and Asci eat of A ement. The Developer represents and agrees that the Developer has not made or created and, prior to the Termination Date, will. not make or create, or suffer to be made or created, any total or partial Me, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to this Agreement or the Property or any part thereof or any interest herein or therein, or any contract or agreement to do any of the same, other than to residential tenants in the ordinary course of business, without the prior written approval of the Authority, which approval shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, the Developer may transfer the Property and assign its interest in this Agreement to an entity affiliated with the Developer or the Developer's owners provided that such new entity executes an instrument in a form acceptable to the Authority by which it assumes and agrees to perform the Developer's obligations under this Agreement. No such assignment or transfer shall relieve the Developer of any liability under this Agreement unless the Authority in writing specifically releases the Developer. A transfer of partnership interests in the Developer shall not be considered a transfer of the Properly hereunder. Section 8.2. Release and Indemnifica#ion Covenants. (a) The Developer releases from and covenants aad agrees that the Authority, the City and the governing body members, officers, agents, servants and employees thereof shall not be liable for and agrees to indemnify and hold harmless the Authority, the City, and the governing body members, officers, agents, servants and employees thereof against any loss or damage to property or any injury to or death of any person occurring at or about or resulting from any defect in the Improvements, provided that the foregoing indemnification obligation shall not apply to damages resulting from any actions or inactions of any of the foregoing parties that are not contemplated by this Agreement. (b) Except for any willful misrepresentation, any willful or wanton misconduct or gross negligence of the following named parties, the Developer agrees to protect and defend the Authority, the City, and the governing body members, officers, agents, servants and employees thereof, now or forever, and further agrees to hold the aforesaid harmless finm any claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising from this Agreement, or the transactions contemplated hereby or the acquisition, construction, installation, ownership, and operation of the Improvements. (c) The Authority, the City, and the governing body members, officers, agents, servants and employees thereof shall not be liable for any damage or injury to the persons or property of the company or its officers, agents, servants or employees or any other person who may be about the Property or Improvements due to any act of negligence of any person. (d) All covenants, stipulations, promises, agreements and obligations of the Authority contained herein shall be deemed to be the covenants, stipulations, promises, agreements and 23 obligations of the Authority and not of any governing body member, officer, agent, servant or employee of the Authority in the individual capacity thereof. (e) Nothing in this Section or Section 8.3 will be construed to limit or affect any limitations on liability of the City or Authority under State or federal law, including without limitation, Minnesota Statutes Sections 466.04 and 604.02. Section 8.3. Environmental Conditions. (a) The Developer acknowledges that the Authority makes no representations or warranties as to the condition of the soils of the Property or the fitness of the Property for construction of the Minimum Improvements or any other purpose for which the Developer may make use of such property, and that the assistance provided to the Developer under this Agreement neither implies any responsibility by the Authority for any contamination of the Property nor imposes any obligation on the Authority to participate in any cleanup of the Property. The City has made certain representations and has agreed to certain obligations in the Option Agreement. (b) Without limiting its obligations under Section 8.2 of this Agreement, the Developer further agrees that, except for any misrepresentation or any misconduct or affirmative act by the Authority or the City and except for any breach by the Authority of its obligations under this Agreement and except for the City's obligations with respect to the environmental condition of the Property as provided in the Option Agreement, the Developer will indemnify, defend, and hold harmless the Authority, the City, and their governing body members, officers, and employees, from any claims or actions arising out of the presence, if any, of hazardous wastes or pollutants existing on or in the Property, unless and to the extent that such hazardous wastes or pollutants are present as a result of the actions or omissions of the indemnities; provided, however, that such indemnification obligations do not apply to costs for which the City is responsible under the terms of the Option Agreement. Nothing in this section will be construed to limit or affect any limitations on liability of the City or Authority under State or federal law, including without limitation, Minnesota Statutes Sections 466.04 and 604.02. 24 ARTICLE IX Events of Default Section 9.1. Events of Default Defined. The term "Event of Default" shall mean, whenever it is used in this Agreement (unless the context otherwise provides): (a) any failure by Developer to observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed hereunder; or (b) if, before issuance of the certificate of completion for the Improvements, the Developer shall (i) file any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act or under any similar federal or State law, which action is not dismissed within sixty (60) days after filing; or or (ii) make an assignment for benefit of its creditors; or (iii) admit in writing its inability to pay its debts generally as they become due; (iv) be adjudicated a bankrupt or insolvent. Section 9.2. Authori Ys s Remedies on Default. Whenever any Event of Default by Developer referred to in Section 9.1 of this Agreement occurs, the Authority may immediately suspend its performance ander this Agreement and/or the Note until it receives assurances from the Developer, deemed adequate by the Authority, that the Developer will cure its default and continue its performance under this Agreement and may take any one or more of the following actions after providing thirty (30) days written notice to the Developer of the Event of Default, but only if the Event of Default has not been cured within said thirty (30) days, or such longer period of time as the Authority may reasonably determine if the Event of Default is of a nature that it cannot be cured in thirty (30) days: (a) Terminate this Agreement and/or the Note. (b) Take whatever action, including legal, equitable or administrative action, which may appear necessary or desirable to the Authority to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant of the Developer under this Agreement. Developer's investor limited partner ("Investor Limited Partner") shall have the right, but not the obligation, to cure any Event of Default by Developer under this Agreement or any default under any other document to, be executed in connection herewith, and Authority shall accept performance by Investor Limited Partner of any obligation of Developer thereunder as though 25 tendered by Developer itself, provided such performance by Investor Limited Partner has occurred during the applicable cure period, if any, provided to Developer thereunder with respect to such default or Event Of Default Section 9.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to the Authority or Developer 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 aceniing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient In order to entitle the Authority or the Developer to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in this Article DC Section 9.4. No Additional Waiver Implied by One. Waiver. In the event any agreement contained in this Agreement should be breached by either party and thereafter waived by the other parry, 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 9.5. Costs of Enforcement 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 of performance or observance of any obligation or agreement on the part of the Developer under this Agreement, the Developer agrees that it shall be liable for the reasonable fees of such attorneys and such other expenses so reasonably incurred by the Authority. Section 9.6 The Developer's Option toa Miggkate. This Agreement may be terminated by Developer, if (i) the Developer is in compliance with all material terns of this Agreement and no Event of Default has occurred; and (ii) the Authority fails to comply with any material term of this Agreement, and, after written notice by the Developer of such failure, the Authority has failed to cure such noncompliance within ninety (90) days of receipt of such notice, or, if such noncompliance cannot reasonably be cured by the Authority within ninety (90) days, of receipt of such notice, the Authority has not provided assurances, reasonably satisfactory to the Developer, that such noncompliance will be cured as soon as reasonably possible. Section 9.7 Action to Terminate. Termination of this Agreement pursuant to Section 9.6 must be accomplished by written notification by the Developer to the Authority within thirty (30) days after the date when such option to terminate may first be exercised. A failure by the Developer to terminate this Agreement within such period constitutes a waiver by the Developer of its rights to terminate this Agreement due to such occurrence or event. Section 9.8 Effect of Termination. If this Agreement is terminated pursuant to Sections 9.6 and 9.7, this Agreement shall be from such date forward null and void and of no further effect; provided, however, the tmm3ination of this Agreement shall not affect the rights of either party to institute any action, claim or demand for damages suffered as a result of breach or default of the terms of this Agreement by the other party, or to recover amounts which had 26 accrued and become due and payable as of the date of such termination. Upon termination of this Agreement pursuant to Sections 9.6 and 9.7, the Developer shall be free to proceed with the Project at its own expense and without regard to the provisions of this Agreement; provided, however, that the Authority shall not be required to make any further payments on the Note. 27 ARTICLE X Additional Provisions Section 10.1.ltenresentatives Not Individually Liable. No member, official, or employee of the Authority shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach or for any amount which may become due to Developer or successor or on any obligations under the terms of the Agreement. Section 10.2. Restrictions on Use. The Developer agrees for itself, and its successors and assigns, and every successor in interest to the Property, or any part thereof, that the Developer, and such successors and assigns, shall until the Termination Date devote the Property to, and only to and in accordance with, the uses specified in this Agreement. Section 10.3. Titles of Articles and Sections. Any titles of the several parts, Articles, and Sections of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 10.4. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under the Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally; and (a) in the case of the Developer, is addressed to or delivered personally to the Developer at 7500 West 78a' Street, Edina, Minnesota 55439, with copies to: Winthrop & Weinstine, P.A. Capella Tower, Suite 3500 225 South Sixth Street Minneapolis, MN 55402 Attn: Jeffrey Koerselman And so long as any affiliates of Wells Fargo Bank, N.A. owns a partnership interest in Developer, to: Wells Fargo Affordable Housing Community Development Corporation MAC D1053-170 301 South College Street, 17th Floor Charlotte, NC 28202-6000 Attention: Director of Asset Management; and (b) in the case of the Authority, is addressed to or delivered personally to the Authority at City Hall, 4401 Xylon Avenue North, New Hope, Minnesota 55428. Or at such other address with respect to either such party as that party may, from time to time, designate in writing and forward to the other as provided in this Section. 28 Section 10.5. Disclaimer of Relationships. Nothing contained in this Agreement nor any act by the Authority or the Developer shall be deemed or construed by any person to create any relationship of third -party beneficiary, principal and agent, limited or general partner, or joint venture among the Authority, the Developer, and/or any third party. Section 10.6. Modifications. This Agreement may be modified solely through written amendments hereto executed by the Developer and the Authority. Section 10.7. Counter arts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 10.8. Judicial Interpret. Should any provision of this Agreement require judicial interpretation, the court interpreting or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against one party by reason of the. rule of construction that a document is to be construed more strictly against the party who itself or through its agent or attorney prepared the same, it being agreed that the agents and attorneys of both parties have participated in the preparation hereof Section 10.9. Business Subsidy Act. Because the Authority's assistance to the Developer's development is being made available for the purpose of encouraging the development of housing, the assistance does not constitute a business subsidy within the meaning of Minnesota Stn—, sections 1161993 to 116J'.995. Section 10.10 Termination. This Agreement shall be null and void on the Termination Date, provided, that Sections 8.2 and 8.3 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. 29 IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf and the Developer his caused this Agreement to be duly executed in its name and behalf on or as of the date first above written. NEW HOPE ECONOMIC DEVELOP1ENT AUTHORITY I t COMPASS POINTE LIMITED PARTNERSHIP By Compass Pointe, LLC, its General Partner By Ronald Clark, its Chief Manager STATE OF MINNESOTA ) SS. COUNTY OF IF The01til g fps nt was ackp1 wlpd fore N this da of , 2014 by b(� and W "1 y pV �G�gt , the President and Executive Director of the New Hope Economic Development Authority, a public body politic and corporate, on behalf of the authority. Notary V91STEVEN A. SONORALLSTATE OF NIINNESOTA) ry Pum�Minrmsot& IMP WWWWW", S fm wa E�nr u Jon 31 2015 COUNTY OF ) The foregoing instrument was acknowledged before me thus day of , 2014, by Ronald Clark, the Chief Manager of Compass Pointe, LLC, a Minnesota limited liability company, the general partner of of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public 30 IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf and the Developer has caused this Agreement to be duly executed in its name and behalf on or as of the date first above written. NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY A COMPASS POINTE LEVIITED PARTNERSHIP By Co ass Pointe, LLC, its General Partner By Ronald Clark, its Chief Manager STATE OF MINNESOTA ) ) SS. COUNTY OF _ ) The foregoing instrument was acknowledged before me this day of 2014, by and _ , the President and Executive Director of the New Hope Economic Development Authority, a public body politic and corporate, on behalf of the authority. STATE OF MINNESOTA ) SS. COUNTY OF Notary Public ja�SARAHMA�RY DDNI; Notary M1nnwK a Mr ��a,ae, st, xutT The foregoing instrument was acknowledged before me this --27 - day of ajj A --, 2014, by Ronald Clark, the Chief Manager of Compass Pointe, LLC, a Minnesota limited liability company, the general partner of of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public 30 SCHEDULE A Description of Property Authority Property: Outlot 1, Mork -Campion Heights, Hennepin County, Minnesota (Ton -ens Property Torrens Certificate No. 1330260) The Fast 75 Feet of Oudot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota The West 75 Feet of the East 150 feet of Outlot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota The West 75 Feet of the East 225 feet of Outlot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota Developer Property: The West 75 feet of the East 300 feet of Outlot 2, Mork -Campion Heights, Hennepin County Minnesota, according to the recorded plat thereof as measured at a right angle from the East line thereof The Developer Property and the Authority Property will be platted as Lot 1, Block 1, Compass Pointe, Hennepin County, Minnesota. SCHEDULE B UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY TAXABLE LIMITED REVENUE TAX INCREMENT NOTE (COMPASS POINTE LIMITED PARTNERSHIP) 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 Compass Pointe Limited Partnership, a Minnesota limited partnership, or its permitted assigns (the "Owner"), solely firm the source, to the extent and in the manner hereinafter provided, the principal amount of this Note, being Six Hundred Eighty Four Thousand Two Hundred Fifty Five Dollars ($684,255.00) (the "Principal Amount"), commencing on August 1, 2016, and continuing on each February 1 and August 1 thereafter up to and including February 1, 2042 (the "Scheduled Payment Dates"). interest at the rate of five and one half percent (5.5%) per annum shall accrue from the date of this Note on the Principal Amount and shall be added to the Principal Amount on each February 1 and August 1 up to and including February 1, 2016. From and after February 1, 2016, simple non -compounding interest at the rate of five and one half percent (5.5%) shall accrue on the outstanding Principal Amount until this Note has been paid in full or terminated in accordance with its terms. This Note is the Note defined in that certain Purchase and Development Agreement dated as of , 2014, between the Authority and the Owner (the "Contract"). 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 Owner and mailed to the Owner at its postal address within the United States which shall be designated from time to time by the Owner. The Note is a special and limited obligation and not a general obligation of the Authority, which has been issued by the Authority pursuant to and in firll conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes. Section 469.178, subdivision 4, to aid in financing a "project", as therein defined, of the Authority consisting generally of defraying certain capital and administrative costs incurred and to be incurred by the Authority within and for the benefit of its Redevelopment Project No. 1(the "Project"). THIS NOTE IS A SPECIAL AND LIMITED AND NOT A GENERAL OBLIGATION OF THE AUTHORITY PAYABLE SOLELY OUT OF AVAILABLE TAX INCREMENT, AS DEFINED BELOW, AND NEITHER THE STATE, THE CITY OF NEW HOPE, NOR ANY POLITICAL SUBDIVISION OF THE STATE, SHALL BE LIABLE ON THIS NOTE, NOR SHALL THIS NOTE BE PAYABLE OUT OF ANY FUNDS OR PROPERTIES OTHER THAN AVAILABLE TAX INCREMENT. The scheduled payment of this Note due on any Scheduled Payment Date is payable solely from and only to the extent that the Authority shall have received in the six (6) month period preceding such Scheduled Payment Date "Available Tax Increment". For purposes of this Note, Available Tax Increment with respect to any Scheduled Payment Date shall mean ninety percent (90%) of the Tax Increment, as defined in the Contract, that has been received by the Authority in the six (6) month period preceding a Scheduled Payment Date. Available Tax Increment constitutes a portion of the real property taxes paid with respect to that certain real property described on the attached Exhibit A (hereinafter referred to as the "Property"). The Authority shall pay on each Scheduled Payment Date to the Owner the lesser of. (i) the Available Tax Increment; or (ii) the amount remaining to be paid under this Note. On the earlier of: (i) the date that this Note has been paid in full; or (ii) February 1, 2042, which is the last Scheduled Payment Date, after making the payment due on such date, the Authority's payment obligations under this Note shall terminate and this Note shall no longer be an obligation of the Authority. All payments made by the Authority shall be applied first to accrued interest and then to the Principal Amount of this Note. The Authority may, at its option, prepay this Note in whole or in part at any time at a price of the outstanding Principal Amount plus accrued and unpaid interest. The Authority's obligations herein are subject to the terms and conditions of the Contract. Upon the occurrence of an Event of Default as provided in Section 9.1 of the Contract, which Contract is incorporated herein and made a part hereof by reference, the Authority's payment obligations hereunder shall be suspended and, upon expiration of all applicable cure periods provided for in Section 9.2 of the Contract, this Note may be terminated by the Authority. Upon such termination, the Authority's obligations to make finther payments hereunder shall be discharged. Such termination may be accomplished by the Authority's giving of written notice to the then registered owner of this Note, as shown on the books of the Authority. 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 Available Tax Increment, and then only to the extent and in the manner herein specified. The 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. This Note shall not be transferable or assignable, in whole or in part, by the Owner without the prior written consent of the Authority, which consent shall not be unreasonably withheld. This Note is issued pursuant to Resolution of the Authority and is entitled to the benefits thereot which resolution is incorporated herein by reference. 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; and that this Note, together with all other indebtedness of the Authority outstanding on the date hereof and on the date of its actual issuance and delivery, does not cause the indebtedness of the Authority to exceed any constitutional or statutory limitation thereon. IN WITNESS WHEREOF, the New Hope Economic Development Authority, by its Board of Commissioners, has caused this Note to be executed by the manual sigwures of the and the of the Authority and has caused this Note to be dated 20 EX KBIT A TO NOTE Description of Property Lot 1, Block 1, Compass Pointe, according to the recorded plat thereof, Hennepin County, Minnesota. Hennepin County, Minnesota Abstract Property Torrens Certificate No. SCHEDULE C Developer Pro forma C MKTIM Lana OamdAWaSe►AhaYnml Anommep Reboatwn La Buy Oat ONSTMIOTION OOaTS sombo "hopm-f"W" Puma MCN AdWeI0 M=AC Pa81Da61cullwl BUWma PPn C' XFT COBTS PROMWONAL SERMES AwhledmA Erpaeng B PmlafuW.W Fee► ah a Parc D40w00en soft Elariwunwial �^'a7 FELE Lao/ -Dash mwa FOMMM COSTS ConobL% im141wan kavnm Fm TAB knummmm Lombne" Bona Oedmal T0wh0 MwIP4e ReyOWanen 7aa Dole S6rAm Ra6rr. ka■w4 Mw ONVIOUalmw FMMdF* Fs Eamaue Mut COI TeaDiarindwa MAULNEN7 LOAN A00BUED EXPENSES REALSETATE TAXES COMMO[ENCY-4x PROJECT MANAGEMENT Demo rFaa CAM ACCOMITS RMmdaatEnt Fina L%=go-w4 Slag ap Teml Sea Ceub 161.610 p—INR 1i EHLERS 1 A►►►au+a► No $9.000 City/ Df New Hope WOOD Ron Clark DeveMpment o Go Unit Tax Credit Apartment 9 4 m EYELOFER FIWINCWG-Id Me11M 1628% 1647% „1.076.000 EVEIAPER FDUWCINO-TIF Lam 620% 6.36% 604260 LXCREDITEOOITY 7616% 70.17% 10.106,904 EYELOPER EOUTY 060% 02M 1 ANOYRr FSMRCW 06.70% 12.1e1AN Lana OamdAWaSe►AhaYnml Anommep Reboatwn La Buy Oat ONSTMIOTION OOaTS sombo "hopm-f"W" Puma MCN AdWeI0 M=AC Pa81Da61cullwl BUWma PPn C' XFT COBTS PROMWONAL SERMES AwhledmA Erpaeng B PmlafuW.W Fee► ah a Parc D40w00en soft Elariwunwial �^'a7 FELE Lao/ -Dash mwa FOMMM COSTS ConobL% im141wan kavnm Fm TAB knummmm Lombne" Bona Oedmal T0wh0 MwIP4e ReyOWanen 7aa Dole S6rAm Ra6rr. ka■w4 Mw ONVIOUalmw FMMdF* Fs Eamaue Mut COI TeaDiarindwa MAULNEN7 LOAN A00BUED EXPENSES REALSETATE TAXES COMMO[ENCY-4x PROJECT MANAGEMENT Demo rFaa CAM ACCOMITS RMmdaatEnt Fina L%=go-w4 Slag ap Teml Sea Ceub 161.610 p—INR 1i W IRM $9.000 421% WOOD *AM o 9 4 0 $137.364 7220% 0,370,106 000% 0 000% D ><0 DOOR 0 000% 0 000It 0 000% 0 OW% 0 000% a eon 0 a6% 700.776 0.40% 0 a DD% 0 400% 0 a DD% 0 000% 0 000% D 400% a 000% 0 000% a a 6.00% 610A70 01X!% Ismo 4 0 a 000% 0 0 0 6 6 0 Doe% 0 0 0 0 O 0 D 0 0.71% 1266.000 D 0 166% 3p4.01! 0 AA33.103 A e 1266ADD 7aeAM 3.640AM Page i of 1 Pnpwad by Mhrma IRR Am"ft 6.36.14-M-1 is DA SCHEDULE D Assessment Agreement ASSESSMENT AGREEMENT and ASSESSOR'S CERTIFICATION By and among NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY, COMPASS POINTE LIMITED PARTNERSITYP, and COUNTY ASSESSOR OF THE COUNTY OF HENNEPIN This document was drafted by: BRADLEY & DEIKE, P.A. 4018 West 65" Street, Suite 100 Edina, Minnesota 55435 THIS AGREEMENT, dated as of this day of , 2014, by and between the New Hope Economic Development Authority, a body politic and corporate (the "Authority") and Compass Pointe Limited Partnership, a Minnesota limited partnership (the "Developer"). WITNESSETH: that: WHEREAS, on or before the date hereof the Authority and the Developer entered into that certain Purchase and Development Agreement (the "Development Agreement") regarding certain real property located in the City of New Hope, hereinafter referred to as the Property and legally described in Exhibit A hereto; and WHEREAS, it is contemplated that pursuant to said Development Agreement the Developer will construct an affordable rental housing development on the Property; and WHEREAS, the Authority and Developer desire to establish a minimum market value for said land and the improvements to be constructed thereon, pursuant to Minnesota Statutes Section 469.177, Subdivision S; and WHEREAS, the Authority and the County Assessor for the County of Hennepin have reviewed the preliminary plans and specifications for the improvements which it is contemplated will be erected. NOW, THEREFORE, the parties to this Agreement, in consideration of the promises, covenants and agreements made by each to the other, do hereby agree as follows: 1. Commencing on January 1, 2016, and continuing on each assessment date thereafter until the termination date stated in paragraph 2 below, the minimum market value which shall be assessed for the land described in Exhibit A and the above described improvements shall be not less than Five Million Nine Hundred and Sixteen Thousand Dollars ($5,916,000), notwithstanding incomplete construction of the above described improvements. 2. This Agreement shall terminate in its entirety on the earlier of December 31, 2040; or when the Note, as defined in the Development Agreement, has been paid. 3. This Agreement shall be promptly recorded at the expense of the Peveloper. 4. Neither the preambles nor provisions of this Agreement are intended to, nor shall they be construed as, modifying the terms of the Development Agreement between the Authority and the Developer. 5. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties. NEW HOPE ECONOARC DEVELOPMENT AUTHORITY By: Its President Its Executive Director COMPASS POINTE LBUMD PARTNERSHIP By Compass Pointe, LLC, its General Partner By Ronald Clark, its Chief Manager STATE OF MINNESOTA ) ) SS. COUNTY OF } The foregoing instrument was acknowledged before me this day of 2014, by and , the President and Executive Director of the New Hope Economic Development Authority, a public body politic and corporate, on behalf of the authority. Notary Public STATE OF MESNESOTA ) ) SS. COUNTY OF } The foregoing instrument was acknowledged before me this day of _ _ , 2014, by Ronald Clark, the Chief Manager of Compass Pointe, LLC, a Minnesota limited liability company, the general parhner of of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public CERTMCATION BY COUNTY ASSESSOR The undersigned, having reviewed the plans and specifications for the improvements to be constructed and the market value assigned to the Iand upon which the improvements are to be constructed, and being of the opinion that the minimum market value contained in the foregoing Agreement appears reasonable, hereby certifies as follows: The undersigned assessor, being legally responsible for the assessment of the above described property, certifies that the market values assigned to such land and improvements are reasonable. County Assessor for the County of Hennepin STATE OF ACU+ NESOTA) )ss. COUNTY OF 1 The foregoing instrument was acknowledged before me this day of , 2014, by the County Assessor for the County of Hennepin. Notary Public �' 1 1` 1- W41 Legal Description of Land Lot 1, Block 1, Compass Pointe, according to the recorded plat thereof;; Hennepin County, hfim rota. Hennepin County, Minnesota Abstract Property Torrens Certificate No. SCHEDULE E QUIT CLAIM DEED THIS INDENTURE, between the City of New Hope, Minnesota, a municipal corporation under the laws of the State of Minnesota (the "Grantor"), and Compass Pointe Limited Partnership, a Minnesota limited partnership (the "Grantee"). WITNESSETH, that Grantor, in consideration of the sum of Three Hundred and Four Thousand Dollars ($304,000.00) and other good and valuable consideration the receipt whereof is hereby aclmowledged, does hereby grant, bargain, quitclaim and convey 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, to -wit (such tract or parcel of Iand is hereinafter referred to as the "Property"): See Exhibit A Attached Hereto To have and to hold the same, together with all the hereditaments and appurtenances thereunto belonging in any wise appertaining, to the said Grantee, its successors and assigns, forever, Provided: SECTION 1. It is understood and agreed that this Deed is subject to the covenants, conditions, restrictions and provisions of an agreement entered into between the New Hope Economic Development Authority (the "Authority") and Grantee on the — day of _ _ , 2014, identified as "Purchase and Development Agreement" (hereafter referred to as the "Agreement") which Agreement is incorporated herein and made a part hereof by reference. This provision, however, shall in no way prevent the Grantee from mortgaging this Property in order to obtain funds for the purchase of Property hereby conveyed and for erecting improvements thereon in conformity with the Agreement, any applicable redevelopment plan and applicable provisions of the Zoning Ordinance of the City of New Hope, Minnesota. It is specifically agreed that the Grantee shall promptly begin and diligently prosecute to completion the redevelopment of the Property through the construction of the improvements thereon, as provided in the Agreement. Promptly after completion of the improvements in accordance with the provisions of the Agreement, the Grantor will cause the Authority to furnish the Grantee with an appropriate instrument so certifying (the "Certificate of Completion'). The Certificate of Completion 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 of the Agreement and of this Deed with respect to the obligation of the Grantee, and its successors and assigns, to construct the improvements and the dates for the beginning and completion thereof. The Certificate of Completion and such determination shall not constitute evidence of compliance with or satisfaction of any obligation of the Grantee to any holder of a mortgage, or any insurer of a mortgage, securing money loaned to finance the purchase of the Property hereby conveyed or the improvements, or any part thereof. The Certificate of Completion and any other certifications provided for herein shall be in such form as will enable them to be recorded with the County Recorder, or Registrar of Titles, Hennepin County, Minnesota. If the Authority shall refuse or fail to provide any such certification in accordance with the provisions of the Agreement and this Deed, the Grantor shall, within thirty (30) days after written request by the Grantee, provide the Grantee with a written statement indicating in adequate detail in what respects the Grantee has failed to complete the improvements in accordance with the provisions of the Agreement or is otherwise in default, and what measures or acts it will be necessary, in the opinion of the Grantor, for the Grantee to take or perforin in order to obtain such certification. ECTI 2 In the event the Grantee herein shall, prior to the completion of construction of the improvements under the Agreement as evidenced by the recording of the Certificate of Completion for such unit, hereinabove referred to: (a) Fail to begin construction of the improvements provided for in this Deed and the Agreement in conformity with the Agreement and such failure is not due to unavoidable delays (as defined in the Agreement) and such failure is not cured within one hundred and twenty 020) days after written notice to do so; or (b) Subject to extensions due to Unavoidable Delays, as defined in the Agreement, default in or violate its obligations with respect to the construction of the improvements provided for in this Deed and the Agreement, or shall abandon or substantially suspend constriction work, and such default, violation or failure is not due to unavoidable delays (as defined in the Agreement), and any such default or violation, abandonment or suspension shall not be cured, ended or remedied within one hundred twenty (120) days after written demand by the Grantor so to do; or (c) Fail to pay real estate taxes or assessments on the Property or any part thereof when due, or shall place thereon any encumbrance or lien unauthorized by the Agreement with the Grantor, or shall suffer any levy or attachment to be made, or any materialmen's or mechanic's liens, or any other unauthorized encumbrances or liens to attach, and such taxes or assessments shall not have been paid or the encumbrance or lien removed or discharged, or provisions satisfactory to the Grantor made for such payments, removal or discharge, within one hundred twenty (120) days after written demand by the Grantor so to do provided, that if the Grantee shall first notify the Grantor 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 Grantor 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 Grantee provides the Grantor with evidence acceptable to the Grantor that the Grantee's title insurance company will insure over the lien or provides a bank letter of credit in the amount of the lien, in a form satisfactory to the Grantor pursuant to which the bank will pay to the Grantor the amount of any lien in the event that the lien is finally determined to be valid and during the course of such contest the Grantee shall keep the Grantor informed respecting the status of such defense; or (d) Cause in violation of the Agreement or of this Deed, any transfer of the Property or any part thereof that is not approved by the Grantor in accordance with the terms of the Agreement, and such violation shall not be cured within sixty (60) days after written demand by the Grantor to the Grantee; or (e) Fail to comply with any of its covenants under the Agreement and fail to cure any such noncompliance within one hundred twenty (120) days after written demand to do so; or (fl Default under the terms of a mortgage loan authorized by Article VII of the Agreement and the holder of the mortgage exercises any remedy provided by the mortgage documents or exercises any remedy provided by law or equity in the event of a default in any of the terms or conditions of the mortgage and such default is not cured by the later of the applicable notice and cure period of such mortgage or one hundred twenty (120) days after written demand by the Grantor; then the Grantor shall have the right to re-enter and retake title to and possession of the Property, subject to the liens and encumbrances then of record, and to terminate and revest in the Grantor the estate conveyed by this Deed to the Grantee, its assigns or successors in interest, subject to the terms and conditions of the Agreement, but only if the events stated in Section 2(a) -(f) have not been cured within the time periods provided above, or if the events cannot be cured within such time periods, the Redeveloper does not provide assurances to the Authority, reasonably satisfactory to the Authority, that the events will be cured and will be cured as soon as reasonably possible. The remedies contained in this Section 2 shall not be available to Grantor upon • the completion of construction of the Project in accordance with the terms of the Agreement. The investor limited partner of the Grantee (the "Investor Limited Partner") shall have the right, but not the obligation, to cure any of the events stated in Section 2(a) — (f) and the Grantee shall accept performance by the Investor Limited Partner of any obligation of the Grantee hereunder as though tendered by Grantee itself, provided such performance by the Investor Limited Partner has occurred during the applicable cure period, if any, provided to Grantee hereunder with respect to such event or breach or default. SECTION 3. The Grantee agrees for itself and its successors and assigns to or of the Property or any part thereof, hereinbefore described, that the Grantee and such successors and assigns shall at all times prior to the Termination Date, as defined in the Agreement: (a) Devote the Property to, and only to and in accordance with the uses specified in any applicable redevelopment plan adopted by the Authority as amended and extended, provided that no amendment shall prohibit a pre-existing permitted use; (b) Comply with all of the terms and conditions of the Agreement. It is intended and agreed that the above and foregoing agreements and covenants shall be covenants running with the land, and that they shall, in any event, and without regard to technical classification or designation, legal or otherwise, and except only as otherwise specifically provided in this Deed and the Agreement, be binding, to the fullest extent permitted by law and equity for the benefit and in favor of, and enforceable by, the Grantor and the Authority, their respective successors and assigns, and any successor in interest to the Property, or any part thereof against the Grantee, its successors and assigns, and every successor in interest to the Property, or any part thereof or any interest therein, and any party in possession or occupancy of the Property or any part thereof. In amplification, and not in restriction of, the provisions of the preceding section, it is intended and agreed that the Grantor and its successors and assigns shall be deemed beneficiaries of the agreements and covenants provided herein. Such agreements and covenants shall run in favor of the Grantor without regard to whether the Grantor has at any time been, remains, or is an owner of any land or interest therein to, or in favor of, which such agreements and covenants relate. The Grantor shall have the right, in the event of any breach of any such agreement or covenant to exercise all the rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breach of agreement or covenant, to which it or any other beneficiaries of such agreement or covenant may be entitled. The covenants and agreements of this Deed and the Agreement shall be enforceable only by Grantor, the Authority, and any public body which is a successor of Grantor or the Authority. SECTION 4. This Deed is also given subject to: (a) Provision of the ordinances, building and zoning laws of the City of New Hope, state and federal laws and regulations in so far as they affect this real estate. (b) Taxes payable subsequent to the date of this conveyance. SECTION 5. The Grantor certifies that the Grantor does not know of any wells on the subject property. IN WITNESS WHEREOF, the Grantor has caused this Deed to be duly executed in its behalf by its President and Executive Director this day of , 2014. CITY OF NEW HOPE 0 Its: Mayor By: Its: Manager STATE OF MINNESOTA) )ss. COUNTY OF HENNEPIN) The foregoing instrument was acknowledge before me this day of 2014, by and, the Mayor and Manager of the City of New Hope, a statutory city organized and existing under the laws of the state of Minnesota, on behalf of the City. Notary Public This instrument was drafted by: BRADLEY & DEIKE, P.A. 4018 West 65' Street, Suite 100 Edina, Minnesota 55435. Exhibit A to Quit Claim Deed Description of Property Outlot 1, Mork -Campion Heights, Hennepin County, Minnesota (Torrens Property Torrens Certificate No. 1391801) The East 75 Feet of Outlot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota, (Abstract Property) The West 75 Feet of the East 150 feet of Oudot 2, Mork -Campion Heights as measured at a right angle from the East line &=of, Hennepin County, Minnesota (Abstract Property) The West 75 Feet of the East 225 feet of Outlot 2, Mork -Campion Heights as measured at a right angle from the East line thereof, Hennepin County, Minnesota (Abstract Property) 91480545 SCHEDULE F In#eriund Loan Resolution NEW HOPE ECONONaC DEVELOPN[ENT AUTHORITY CITY OF NEW HOPE HLNNEMN COUNTY STATE OF MINNESOTA RESOLUTION NO. -2om-o7 RESOLUTION AUTHORIZING AN ENTERFUND LOAN FOR ADVANCE OF CERTAIN COSTS IN CONNECTION WITH THE COMPASS POINTE HOUSING TAX INCREMENT FINANCING DISTRICT. BE 1T RESOLVED by the Board of Commissioners (the "Board") of the Now Hope Economic Development Authority (the "EDA") of the City of New Hope, Minnesota as follows: WHEREAS, the City Council for the City of New Hope, Minnesota (dw "City"), intends to establish the Compass Pointe Housing Tax Jitemment Financing District (the "TIF District") within Redevelopment Project No. I (the "Project"), and will adopt a Tax Increment Financing Pian (the "TIF Plan") for the purpose of financing certain improvements within the Project. WHEREAS, the EDA has determined to pay for certain costs identified in the TIF Plan consisting of land/building acquisition, site itnprove1 reparation, public utilities, street and sidewalks, interest and administrative coats (collectively, the " flied Costs"), which costs may be furanced ion a temporary basis from EDA funds available for such purposes. WHEREAS, under Minnesota Statutes, Section 469.178, Subd. 7, the EDA is authorized to advance or loan money from the EDA's general fund or any other fund from which such advances may be legally authorized, in order to finance the Qualified Costs. WHEREAS, the EDA owns carton property (the "EDA Parcels'j and has incurred certain costs .to prepare such property for redevelopment; including demolition, relocation and site clearance. The EDA has determined that the estimated market value of the EDA Parcels is at least $453,281. WHEREAS, the EDA proposes to eater into a Purchase and Development Agreement (the "Development Agreement") with Compass Pointe Limited Partnership (the "Developed, under which the EDA will (among otherthfiW) convey the EDA Pamis to the Developer for 5304,000. WHEREAS, the EDA also proposes to enter into a Purchase and Development Agrownent with the Developer (the "TIF Agreement"), specifying certain financial assistance to Developer in connection with the Development Property. WHEREAS, by conveying the EDA Parcels under the Purchase and Development Agreement, at closing the EDA will forgo receipt of the till market value of the EDA Parcels. Such forbearance repro an advance of EDA fiords in the amount of $149,300. WHEREAS, the EDA intends to designate such land advance as an interfimd loan in accordance with the terms of this resolution and the TIF Act (which terms are referred to collectively as the "Interfund Loan"). i NOW TMWORE BE Tf RESOLVED by the Board as follows: 1. The Authority well reimburse Win the principal amount of $149,300 together with interest at the rate of 49/9 per annum (the "interfund Loan"). iftrest accrues on the principal amount from the data of closing on conveyance of the EDA Parcels to the Developer under the Development Agreement (hermfier, the "Closing Date). The maximum rate of interest permitted to be charged is limited to the greater of the rates specified under Minnesota Stag, Section 2700,40 or Section 549.09 as of the date the loan or advance is authorised, unless the vpitten agreement states that the maximum interest rata will fluctuate as the interest rates speoifnod under Miaaesata Statutes, Section 270C.40 or Section 549.09 ase from tine to time adjusted. The interest rate shall be 4% and will not flmcivate. 2. Principal and interest ("Payments") on the Imtesfund Loan shall be paid semi-annually on ewh August 1 and February 1 (each a; "Payment Dstc% commencing on the first Payment Date on which the MORA has Available Tax Incremegt (defined below), or on any other dates determined by the Executive Director of the FDA, through the date of last receipt of tax increment h om the TIF District. 3. Payments on this Interfund Loan are payable solely from "Available Tax Increment," which shall mean, on each Payment Date, tax increment available after outer obligations have been paid, or as deermined by the City Manager, generated in the preceding six (6) months with respect to the property within the TEF District and remitted to the City by Hemaepin County, all in accordance with Minnesota Statutes, Sections 469.174 to 469.1799, all inclusive, as amended. Payments on this hd rfund Loan may be subordinated to any outstanding or fun m bonds, notes or contracts secured in whole or in part with Available Tax increir=4 and are on parity with any oth a outstanding or future intorfund loans secured in whole or in part with Available Tax Inaw nwiL 4. The principal sum and all accrued interest payable under this Inteafkmd Loan are pre myeble in whole or in part at any time by the EDA without premium or penalty. No partial primmient shatI sabot the amonunt or timing of any other regular payment otherwise required to be made under this Interfund Loan, S. This Iaterfand Loan is evidence of an internal borrowing by the SDA in accordance with Minnesota Statutes, Section 469.178, Subd. 7, and is a limited obligation payable solely from Available Tax Inoranent pledged to the payment hereof under this rmlubon. This Imterfimd Loan and the interest hereaan shall not be deemed to constitute a general obligation of the State of Minnosata or any political subdivision t mw& including, without limitation, the EDA. Neither the State of Minnesota, mor any political subdivision thereof shall be obligated to pay the principal of or interest of this Interfind Loan or other oasts incideatt hereto amept out of Available Tax Incremwi4 and neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment of the principal of or interest on this hmwfund Loan or other axft incident hereto. The EDA shall have no obligation to pay any principal amount of the laterfumd Loan or accrued fina st tha=% which may rcmtain unpaid alter the final Payment Date. 6. The EDA may amend the tams of this laterftinad Loan at any time by resolution of the Board, including a determination to forgive the outstanding principal amount and accrued interest to the extent permissible under law. Approved by the Board on March. 24 , 2014. - yr Daniel 3 .President Pr�Tem Doc No T0SIS1198 Certified, filed and/or recorded on Jul 1, 2014 2:00 PM Office of the Registrar of Titles Hennepin County, Minnesota Martin McCormick, Registrar of Titles Mark Chapin, County Auditor and Treasurer Deputy 84 Pkg ID 1125705C Doc Name: Assessment Agreement Document Recording Fee $46.00 Document Total $46.00 Existing Certs New Certs 1388616 This cover sheet is now a permanent part of the recorded document. Assessment Agreement ASSESSMENT AGREEMENT and ASSESSOR'S CERTIFICATION By and among NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY, COMPASS POINTE LINIITED PARTNERSHIP, and COUNTY ASSESSOR OF THE COUNTY OF HENNEPIN This document was drafted by: BRADLEY & DEIKE, P.A. 4018 West 65'h Street, Suite 100 Edina, Minnesota 55435 `k.'Z� 0,4 —10 Commercial Partners Tale, LLC 200 South Sixth Street Suite 1300 Minneapolis, MN 65402 -311 y z- 46- 3 (-t) Ti 'e`c-- THIS AGREEMENT, dated as of this _4g? day of 2014, by and between the New Hope Economic Development Authority, a body politico"dcorate (the "Authority") and Compass Pointe Limited Partnership, a N innesota limited par(the "Developer"). WITNESSETH: that: WHEREAS, on or before the date hereof the Authority and the Developer entered into that certain Purchase and Development Agreement (the 'Vevelopment Agreement") regarding certain real property located in the City of New Hope, hereinafter referred to as the Property and legally described in Exhibit A hereto; and WHEREAS, it is contemplated that pursuant to said Development Agreement the Developer will construct an affordable rental housing development on the Property; and WHEREAS, the Authority and Developer desire to establish a minimum market value for said land and the improvements to be constructed thereon, pursuant to Minnesota Statutes, Section 469.177, Subdivision $; and WHEREAS, the Authority and the County Assessor for the County of Hennepin have reviewed the preliminary plans and specifications for the improvements which it is contemplated will be erected. NOW, THEREFORE, the parties to this Agreement, in consideration of the promises, covenants and agreements made by each to the other, do hereby agree as follows: 1. Commencing on January 1, 2016, and continuing on each assessment date thereafter until the tenon date stated in paragraph 2 below, the minimum market value which shall be assessed for the land described in Exhibit A and the above described improvements shall be not less than Five Million Nine Hundred and Sixteen Thousand Dollars ($5,916,000), notwithstanding incomplete construction of the above described improvements. 2. This Agreement shall terminate in its entirety on the earlier of December 31, 2040; or when the Note, as defined in the Development Agreement, has been paid. 3. This Agreement shall be promptly recorded at the expense of the Developer. 4. Neither the preambles nor provisions of this Agreement are intended to, nor shall they be construed as, modifying the terms of the Development Agreement between the Authority and the Developer_ 5. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties. STATE OF MINNESOTA ) ) SS. COUNTY OF V%) NEW HOPE ECONONIIC DEVELOPMENT AUTHORITY By. -':� . " I ent By--- Its y-Its Executive Director COMPASS POINTE LII&TED PARTNERSHIP By Compass Pointe, LLC, its General Partner By Ronald Clark, its Chief Manager 4 r The re was ac wed fore a this of � day of �t�-r ,} 2014, by and 1 the President and Executive Director of the New Hope Economic Development Authority, a public body politic and corporate, on behalf of the authority. STATE OF MINNESOTA ) ) SS. COUNTY OF Notary Public STEVEN A. SONDRALL , *•� tr'otary Puhitc-Minnesota on EC,06% 6% dz^ 3120015 .MWv�MnN+t The foregoing instrument was acknowledged before me this day of , 2014, by Ronald Clark, the Chief Manager of Compass Pointe, LLC, a Minnesota limited liability company, the general partner of of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public --� S. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties. NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY By: Its President By: Its Executive Director COMPASS POINTE LIMITED PARTNERSHIP B=ass LC, its General Parhier By Ronald Clark, its Chief Manager STATE OF MINNESOTA ) ) SS. COUNTY OF — The foregoing instrument was acknowledged before me this day of 2014, by and _ 'the President and Executive Director of the New Hope Economic Development Authority, a public body politic and corporate, on behalf of the authority. STATE OF MINNESOTA ) ) SS. COUNTY OF Notary Public SARAH MARY DULONG f�Otary PubNo-Minnesota W Comm Anion E#Md JN 31. BD17 The foregoing instrument was acknowledged before me this T7 day of 201.4, by Ronald Clark, the Chief Manager of Compass Pointe, LLC, a Minnesota limited liability company, the general partner of of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership_ _ Ngfary Public CERTIFICATION BY COUNTY ASSESSOR The undersigned, having reviewed the plans and specifications for the improvements to be constructed and the market value assigned to the land upon which the improvements are to be constructed, and being of the opinion that the minimum market value contained in the foregoing Agreement appears reasonable, hereby certifies as follows: The undersigned assessor, being legally responsible for the assessment of the above desc;ibpd property, certifies that the market values assigned to such land and improvements are rele. my Assessor fo'r of Hennepin STATE OF MINNESOTA) )ss. COUNTY OF �} The foregoing instrument was acknowledged before me this J0 day of 2014, by the County Assessor for the County of Hennepin. ELJ#JODEE ta EOib Legal Description of Land Lot 1, Block 1, Compass Pointe, according to the recorded plat thereof, Hennepin County, Minnesota. Hennepin County, Minnesota Abstract Property Torrens Certificate No. 9209808vl Pup y,q vv9Doe No A10092639 I��I�I�I�UR116�III111� Certified, filed and/or recorded on Jul 1, 2014 2:00 PM Office of the County Recorder Hennepin County, Minnesota Martin McMormick, County Recorder Mark Chapin, County Auditor and Treasurer Deputy 84 Pkg ID 11257190 Doc Name: Agreement Document Recording Fee $46.00 Document Tota! $46.00 This cover sheet is now a permanent part of the recorded document. CITY OF NEW HOPE PLANNED UNIT DEVELOPMENT SITE IMPROVEMENT AGREEMENT (PUD Development District 12-04) THIS AGREEMENT is entered into by Compass Pointe Limited Partnership, a Minnesota limited partnership (hereafter "Developer"), and a City of New Hope, a Mimiesota municipal corporation (hereafter "City"), this day of 2014. WHEREAS, Developer is the fee owner C Vrea property located in the City of New Hope, Hennepin County, Minnesota legally described as follows (hereafter "Property-): Lot 1, BIock 1 Compass Pointe, according to the duly recorded plat thereof, Hennepin County, Minnesota Street Address P.I.D. Numbers WHEREAS, the Property has been rezoned as PUD District 12-04 pursuant to Ordinance No. 2012-06 adopted by the City Council at its regular meeting on May 29, 2012, and WHEREAS, Developer has submitted development plans and specifications identified as New Hope Planning Case 14-03 for the construction of a 68 unit, affordable apartment complex to be known as "Compass Pointe" (hereafter the "Project") located at the Property in the City of New Hope, WHEREAS, Developer's development plans for development and final stage Planned Unit Development approval and for preliminary and final plat approval for construction of the Project on the Property were adopted by the City Council at its regular meeting on February 24, 2014 pursuant to VCA,t"—Iz� Commercial Partners Title, LLC 200 South Sixth Street Stine 1300 Minneapolis, MN 55402 SIM yz -s" 0-6 r (T ) �W- Resolution Nos. 2014-36 and 2014-37 respectively, and, WHEREAS, this PUD Site Development Agreement was approved subject to the following conditions: 1. Developer shall, at its cost, provide title evidence for the Property to the City Attorney and enter into this written and recordable PUD Site Development Agreement (hereafter "Agreement") incorporating the conditions of approval set out in Resolution Nos. 2014-36 and 2014-37. Developer agrees it will construct and maintain the Project and Property in accordance with the plans and specifications it has submitted for approval in Planning case No. 14-03. Developer acknowledges and agrees this Agreement shall run with the land and shall be binding on Developer and all successors in title to the Property and Project. 2. Developer shall provide a financial guarantee as provided in Paragraphs 5 and 11 of this Agreement in order to insure construction of the secured work and proposed improvements described in paragraph 3. Said financial guarantee shall be in the amount of $70,500.00 and shall also guarantee the payment of all administrative staff costs and planning, engineering and legal costs incurred by the City in connection with Developer's request for approval of this Agreement for construction of the Project at the Property. Developer specifically agrees to pay these costs as a condition of the herein approval. 3. The parties have entered into this Agreement which Developer agrees shall only be effective upon its recording subsequent to the recording of the Plat of Compass Pointe with the Hennepin County Recorder's Office and the Office of the Registrar of Titles for Hennepin County Minnesota. 4. Developer agrees approval of this Agreement is also subject to Hennepin County's approval of the Plat of Compass Pointe and that any alterations to the plat required by Hennepin County shall be incorporated into Developer's site plan and this agreement by this reference subject to compliance with the City's zoning code and regulations. 5. The required public improvements for the Project shall include but not be limited to the following as set forth in the plans and specifications submitted by Developer in Planning Case 14-03: a.) Burial of all overhead utilities for the Project; b.) New curb cut installation and removal of existing unused curb cuts; c.) Installation of new sidewalks along West Broadway d.) Replacement of existing sidewalks along 62m4 Avenue; e.) Installation of all utility connections required for the project Q Developer shall provide an irrevocable letter of credit in an amount of $70,500.00 per the City Engineer's April 10, 2014 letter attached hereto as K Exhibit A to financially guarantee construction and installation of the public improvements for the Project. b. Developer shall pay a park dedication fee of $8,400.00. This fee shall be paid to the City of New Hope prior to the Final Plat being released for filing at the Hennepin County Recorder's Office and at the Registrar of Titles for Hennepin County. 7. All adjusted building setbacks shall be approved by the City Council. 8. Developer hereby agrees, in the sole discretion of the City, to construct 22 additional parking stalls (the "Additional Parking") in the green space of the Property shown on the Development Stage Plan as described in the January 28, 2014 Memorandum froze. the City Planner Northwest Associated Consultants, Inc. attached hereto as Exhibit B. The City may require the Developer or its successor in interest to build the Additional Parking if, in the City's reasonable discretion, it determines the following conditions exist at the Property: i) parking occurs outside the designated parking stalls, in driveways, fire lanes, or in green space due to insufficient on-site parking or ii) off-site street parking occurs attributed to Compass Pointe tenants or guests. If the Developer is required by the City to construct the Additional Parking, Developer shall also provide "No Parking and "Subject to Ticketing" signage in the driveway and fire lane if violations occur. 9. The Applicant shall provide a snow removal plan to be included in the Agreement. The snow removal plan should include provisions that allow the City to require snow removal for the following items: a) The Developer/property owner of the Project shall be responsible for snow removal on the public sidewalks along West Broadway and 62nd Avenue. This requirement is in consideration for reduced setbacks that limits snow storage in these areas. The snow removal must be in conjunction with parking lot plowing. Sidewalks must be cleared to allow safe pedestrian passage year round. Snow shall be hauled off the site by Developer/property owner of the Project if sidewalk snow storage becomes a problem for the Project, survival of the landscaping is jeopardized or traffic visibility is negatively affected by the snow storage at the 62 Avenue and West Broadway intersection or either of the site access points. b) Snow must be removed from all internal sidewalks to allow safe pedestrian passage year round. c) Parking lot snow shall be stored in designated snow storage areas. Snow must be hauled off-site if the following conditions occur: i) Snow storage shall not be allowed in the constructed parking stalls, ii) Snow storage shall not reduce the available required parking, iii) Snow storage shall not result in damage of in-place landscaping, iv) Snow storage shall not 3 interfere with traffic visibility at the site access points, v) Snow storage shall not extend more than two feet above the eight foot tall boundaryline fence. 10. Bicycle parking shall be provided meeting the following conditions: a) Developer shall provide design detail of bike racks for an evaluation of parking capacity. b) Developer shall remove bike rack from green space/snow storage area and provide hard surface for bike parking. c) Developer shall provide additional bike parking on west end of the building. 11. A pedestrian sidewalk shall be provided through the activity area to the western fence opening. 12. Developer shall execute and deliver to the City that certain Agreement to Maintain Underground Stormwater Storage System attached to this Agreement as Exhibit C. 13. Drainage and utility plans provided by Developer shall be subject to the approval of the City Engineer. 14. Developer shall provide a landscaping plata reasonably acceptable to the City and subject to the following conditions: a) any landscaping that dies or shows stress unacceptable to the City shall be replaced by Developer or the property owner as provided by the plan. b) any planting or site improvements located in the public right of way or easements may be removed by the City in conjunction with City projects. Replacement of the landscaping and/or improvements shall be the Developer's or properly owner's responsibility at their cost. 15. Developer shall provide a detail of the eight foot boundary line fence which shall be Subject to City approval. 16. If not previously approved, all building signs shall be subject to approval by the City Council. 17. Light intensity regulations at the right of way lines and along- 62"d Avenue were approved by the City Council at its February 24, 2014 meeting. The resolution of the City Council dated February 24, 2014 approving various items related to the Project shall be amended to reflect such approval. 18. Developer shall comply with all ministerial matters set forth in the New Hope City Code and required by the City, including but not limited to, those of the City Engineer and Public Works, Community Development, City Manager and Clerk and the City Attorney, i.e. title examination, execution of the Agreement, Sling of letters of credit and payment of all City fees for Planning Case 14-03. 19. The site plans and building plans submitted by Developer as part of Planning Case 14-03 shall be subject to the review and approval of the New Hope Fire Marshall. 20. Construction of and maintenance of the Project and Property shall comply with the plans submitted by Developer as part of Planning Case 14-03, this Agreement, subsequent approvals and local, state and federal laws, rules and regulations. 21. The Final Plat for Compass Pointe must be filed and recorded within a reasonable time. If the Final Plat is not timely filed or recorded, upon thirty (30) days written notice from the City to the Developer, this Agreement and all approvals herein shall be void with no further action required by the City Council NOW, THEREFORE, ff IS HEREBY AGREED as follows: 1. INCORPORATION OF RECITALS. The recitals above are incorporated herein by reference, specifically including the conditions for this PUD Site improvement Agreement. 2. THE WORK. The Work shall consist of the site improvements described in the Plans, including the Secured Work as described below, and including any amendments to the Plans which are approved by the City Council. The Work shall be performed by the Developer to the City's reasonable satisfaction and in compliance with all applicable codes, ordinances, standards, and policies of the City. 3. THE SECURED WORK. The Secured Work includes all on-site exterior amenities shown on the Site Plan as described by the City Engineer's April 10, 2014 Memorandum that is listed below: IMpmement - Estimated cost a. Demolition $3,000.00 b. Utilities $15,000.00 c. Private Driveway $22,000.00 d. LaaclscapingResboration $7.000.00 Subtotal $47,000.00 + 50% con ' en S23,500.00 Letter of Credit/Bond amount required $70,500.00 The Developer shall maintain all Secured Work for as long as the Property is zoned PUD District 12-04. 4. COMPLETION. The Developer agrees that the Work shall be completed in its entirety on or 5 before the 31" day of December, 2015 (the Completion Date), except as this period of time is extended by resolution of the City Council, or by the City taldng no action to require completion hereunder on a timely basis. It is understood and agreed that failure of the City to promptly take action to draw upon the bond or other searrity to enforce this Agreement atter the expiration of the time in which the Work is to be completed hereunder will not waive, estop or release any rights of the City and the City can take action at any time thereafter to require completion of the Work, and payment for same. Fore, the term of this Agreement shall be deemed to be automatically extended until such time as the City Council declares the Developer in default hereunder, and the statote of limitations shall not be deemed to commence running until the City Council has been notified in writing by the Developer that the Developer has either complied with this Agreement, or that it refuses to for any reason. These provisions shall be applicable to any person who shall give a financial guarantee to the City as required below. 5. COST OF WQRK. The Developer shall pay for all costs of persons doing work or furnishing skill, tools, machinery or materials, or insurance premiums or equipment or supplies and all just claims for the same, and the City shall be under no obligation to pay the Developer or any subcontractor any sum whatsoever on account thereof; whether or not the City shall have approved the subcontract or subcontractor, and the Developer and its surety shall hold the City harmless against any such claims, and provide the City with all necessary lien waivers. 6. DEFAULT. In the event of default by the Developer as to any of the Secured Work to be performed hereunder, the City may, at its option, perform the Secured Work and the Developer shall promptly reimburse the City for any expense incurred therein by the City, provided the Developer is first given written notice by United States Mail ofthe Secured Work in default and :required to be done by the Developer, not less than thirty (30) days being given thereby to the Developer to remove the default status, said notice being addressed to the Developer at the address set forth below Notice given in this manner being sufficient as described, by agreement of the parties hereto. Notice to the Developer shall also constitute, without further action, notice to any contractor or subcontractor, whether they are approved and accepted by the City or not. In the event of emergency, as determined by the City Engineer, the thirty (30) day notice requirement to the Developer shall be and hereby is waived in its entirety by the Developer, and the Developer shall reimburse the City for any expense so incurred by the City in the same manner as if mailed notice as described above had been. given_ It is understood by the parties, however, that the responsibility of the Developer is limited by strikes and force maj eure. R 7. REVOCATION OF RENTAL PERMITS. The City Council approved this PUD Site Improvement Agreement for the construction of a 68 emit apartment complex on the Property subject to certain conditions including completion of the Work and compliance with the provisions of New Hope Ordinance No. I2-06. As an additional remedy separate and independent from any other remedy available to it, upon a breach of this Agreement by Developer that materially and adversely affects the use of the Property, the City may revoke the rental permits for the Property required by New Hope Code §3-31 et al. Developer acknowledges and agrees that the City may also revoke the rental permits for the Property for failure of the Developer to satisfy any of the other conditions of this PUD Site Improvement Agreement when such failure materially and adversely affects the use of the Property. Upon any breach or default by the Developer as described in this Section 7, the City shall provide thirty (30) days' notice and right to cure any such breach or default prior to the revocation of any rental permit to the Developer and its investor limited partner (the "Limited Pa taW')- The Lwiited Partner shall have the right, but not the obligation, to cure any such breach or default by the Developer and the City shall accept performance by the Limited Partner of any obligation of the Developer as though tendered by Developer itself provided such performance by the Limited Partner has occurred during the thirty (30) day cure period provided in this Section 7. S. ADUMI TRATION COSTS. Developer agrees to reimburse the City for the actual costs to the City associated with Planning Case 14-03 and this Agreement, including but not limited to, planning consultant, engineering and attorney's fees. Developer agrees that the financial guarantee shall not be released until all such costs have been paid to the City. 9. MOLD HARML_E-8S. Except with respect to the gross negligence or willful misconduct of the City, its agents, employees, or representatives, the Developer agrees to indemnify and hold harmless the City and its agents, employees, and representatives against any and all claims, demands, losses, damages and expenses (including attorney fees) arising out of or resulting from the Developer's negligent or intentional acts, or any violation of any safety law, wgulataion or code in the performance of this Agreement, without regard to any inspection or review made or not made by the City, its agents, employees, or representatives, or failure by the City, its agents, employees, or representatives to take any other prudent precaution. In the event any City employee, agent or representative shall come under the direct or indirect control of the Developer, or the City upon the failure of the Developer to comply with any conditions of this Agreement, performs said conditions pursuant to the financial guarantee, the Developer shall indemnify and hold harmless the City, its employees, agents and representatives for its own negligent or intentional acts in the performance of the Developer's required work under this Agreement 10. COST OF ENFORsrE ENT. The Developer agrees to reimburse the City for all costs incurred by the City in the enforcement of this Agreement, or any portion thereot including court costs and reasonable engineering and attorney's fees. 11. FINANCIAL GUARANTEE. The Developer shall furnish the City with a financial guarantee acceptable to the City in one of the following forms: a) cash escrow; b) an irrevocable letter of 7 credit; c) an automatically renewing certificate of deposit in Developer's name but irrevocably assigned to the Cita, d) other financial instruments which provide equivalent assurance to the City_ Said financial guarantee shall be furnished to the City as security to assure completion of the items of Secures Work as set forth above, and payment of the costs of mon as set forth above. The financial guarantee shall be in an amount of $70,500.00. The financial guarantee provided shall continue in full force and effect until the City Council approves and accepts all of the Secured. Work undertaken and releases the surety and/or the Developer from any further liability, and until all administrative costs are paid in full. The City Council may reduce the amount of the financial guarantee upon partial completion of the Secured Work and payment of all outstanding administrative costs: 12. CITY ACKNOWLEDGMENT. The Project was mistakenly referred to as a "market rate" apartment development in City Council Resolution 2014-36. The City aclmowledges that the Project is an affordable apartment development financed using Low Income Housing Tax Credits and any references to "market rate" in City Council Resolution 2014-36 or other similar documents or resolutions shall be corrected to "affordable." 13. NOTICE. The address of Property Owner and Tenant; for purposes of this Agreement is as follows, and any notice mailed by the City to these addresses shall be deemed sufficient notice to Property Owner and Tenant under this Agreement, until notice of a change of address is given to the City in writing: If to the Developer: Compass Pointe Limited Partnership 7500 West 7e Street Edina, MN 55439 Attention: Ronald E. Clark With a copy to: Winthrop & Weins me, P.A. 225 South Sixth Street Suite 3500 Minneapolis, MN 55402 Attention: Jeffrey J. Koerselman If to the Limited Partner: Wells Fargo Affordable Housing Community Development Corporation MAC D1053-170 301 South College Street, l7d'Floor Charlotte, NC 28202-6000 14. SEVERABILITY. If any portion, section, subsection, paragraph, sentence, clause or phrase of this Agreement is for any reason held to be invalid, such decision shall not affect the validity of the remaining portion of this Agreement. 15. SUCCESSION. This Agreement shall be binding upon the parties, their heirs, successors or assigns, as the case may be. IN WITNESS WHEREOF, we have hereunto set our bands and seals. CITY OF NEW HOPE By: Its Mayor 1 By: Its City Manager COMPASS POINTE LE MTED PARTNERSHIP By: Compass Pointe LLC Its General Partner By: Ronald E. Clark Its Chief Manager STATE OF MINNESOTA ) )Ss. COUNTY OF HENNEPIN ) r( jTheforegoing ent was acknowledged before me this �r day of yj- , 201 Kathi Hernken and Kirk McDonald, the Mayor and Manager, respectively, of the City of New Hope, a Minnesota municipal corporation, on behalf of said municipal corporation. Notary Public E of the remaining portion of this Agreement. 15. SUCCESSION. This Agreement shall be binding upon the parties, their heirs, successors or assigns, as the case may be. IN WITNESS WHEREOF, we have hereunto set our hands and seals. CITY OF NEW HOPE By. Its Mayor 0 Its City Manager COMPASS POINTE LD4n ED PARTNERSHIP By: Compass Pointe LLC Its General Partner By: ao�c'/ Ronald E. Clark Its Chief Manager STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of 201. by Kathi Hemken and Kirk McDonald, the Mayor and Manager, respectively, of the City of New Hope, a Minnesota municipal corporation, on behalf of said municipal corporation. Notary Public D STATE OF MINNESOTA ) SARAH MARY DULONG ss. "� �s NGtWy Pub�nnesota "xOwNdsown �,ay g1, 2017 COUNTY OF C,�h- ) The foregoing instrument was acknowledged before me this 97 day of Jd ,h1 _, 201 , by Ronald E. Clark, the Chief Manager of Compass Pointe LLC, a Minnesota limited liability company, the general partner of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of said limited liability company and limited partnership. _•l . t 1 161 M, rIT2 k1n 16 DRAFTED BY.• JENSEN SONDRALL & PERSELLIN, P.A. 8525 Edinbrook Crossing, #201 Brooklyn Park, MN 55443 (763)424-8811 P SAo�yL4AS11 Cow Meda City dWV WB p289.2140) C'wu- Pante Wextbm&wX=q= PoOrte pd ffik 1n,prmtcmt.4w= d9 d= 9193107x3 10 IIIIIIII�III�RIR�IIAIDoe No TOSI 81199 Certified, filed and/or recorded on Jul 1, 2014 2:00 PM Office of the Registrar of Titles Hennepin County, Minnesota Martin McCormick, Registrar of Tides Mark Chapin, County Auditor and Treasurer Deputy 84 Pkg ID 1125705C Doc Name: Agreement Document Recording Fee $46.00 Document Total $46.00 Existing Certs New Certs 1388516 This cover sheet is now a permanent part of the recorded document. E44 M MXe)_a 0 alaTCW10 PLANNED UNIT DEVELOPMENT SITE IlUMOVEMENT AGREEMENT (PUD Development District 12r04) THIS AGREEMENT is entered into by Compass Pointe Limited Partnership, a Minnesota limited partnership (hereafter "Developer"), and,*e City of New Hope, a Minnesota municipal corporation (hereafter "City"), this qday of 2014. WHEREAS, Developer is the fee ownerf property located in the City of New Hope, Hennepin County, Minnesota legally descn`bed as follows (hereafter "Property"): Lot 1, Block 1 Compass Pointe, according to the duly recorded plat thereof, Hennepin County, Minnesota Street Address P.I.D. Numbers WI3EREAS, the Property has been rezoned as PUD District 12-04 pursuant to Ordinance No. 2012-06 adopted by the City Council at its regular meeting on May 29, 2012, and WBEREAS, Developer has submitted development plans and specifications identified as New Hope Planning Case 14-03 for the construction of a 68 unit, affordable apartment complex to be known as "Compass Pointe" (hereafter the "Project") located at the Property in the City of New Hope, WHEREAS, Developer's development plans for development and final stage Planned Unit Development approval and for preliminary and final plat approval for construction of the Project on the Property were adopted by the City Council at its regular meeting on February 24, 2014 pursuant to ►% L Title, LLC Cornmerciai Partners treet 200 South Sixth Suite 1340 Minneapolis, MN 55402 3 7?W2- st S (A ) -Sve- Resolution Nos. 2014-36 and 2014-37 respectively, and, VVMREAS, this PUD Site Development Agreement was approved subject to the following conditions: Developer shall, at its cost, provide title evidence for the Property to the City Attorney and enter into this written and recordable PUD Site Development Agreement (hereafter "Agreement") incorporating the conditions of approval set out in Resolution Nos. 2014-36 and 2014-37. Developer agrees it will construct and maintain the Project and Properly in accordance with the plans and specifications it has submitted for approval in Planning case No. 14-03. Developer acknowledges and agrees this Agreement shall run with the land and shall be binding on Developer and all successors in title to the Property and Project. 2. Developer shall provide a financial guarantee as provided in Paragraphs 5 and 11 of this Agreement in order to insure construction of the secured work and proposed improvements described in paragraph 3. Said financial guarantee shall be in the amount of $70,500.00 and shall also guarantee the payment of all administrative staff costs and planning, engineering and legal costs incurred by the City in connection with Developer's request for approval of this Agreement for construction of the Project at the Property. Developer specifically agrees to pay these costs as a condition of the herein approval. 3. The parties have entered into this Agreement which Developer agrees shall only be effective upon its recording subsequent to the recording of the Plat of Compass Pointe with the Hennepin County Recorder's Office and the Office of the Registrar of Titles for Hennepin County Minnesota. 4. Developer agrees approval of this Agreement is also subject to Hennepin County's approval of the Plat of Compass Pointe and that any alterations to the plat required by Hennepin County shall be incorporated into Developer's site plan and this agreement by this reference subject to compliance with the City's zoning code and regulations. 5. The required public improvements for the Project shall include but not be limited to the following as set forth in the plans and specifications submitted by Developer in Planning Case 14-03: a.) Burial of all overhead utilities for the Project; b.) New curb cut installation and removal of existing unused curb cuts; c.) Installation of new sidewalks along West Broadway d.) Replacement of existing sidewalks along 62nd Avenue; e.) Installation of all utility connections required for the project Q Developer shall provide an irrevocable letter of credit in an amount of $70,500.00 per the City Engineer's April 10, 2014 letter attached hereto as 2 Exhibit A to financially guarantee construction and installation of the public improvements for the Project. 6. Developer shall pay a park dedication fee of $8,400.00. This fee shall bepaid to the City of New Hope prior to the Final Plat being released for filing at the Hennepin County Recorder's Office and at the Registrar of Titles for Hennepin County. 7. All adjusted building setbacks shall be approved by the City Council. 8. Developer hereby agrees, in the sole discretion of the City, to construct 22 additional parking stalls (the "Additional Parking") in the green space of the Property shown on the Development Stage Plan as described in the January 28, 2014 Memorandum from the City Planner Northwest Associated Consultants, Inc. attached hereto as Exhibit B. The City may require the Developer or its successor in interest to build the Additional Parking if, in the City's reasonable discretion, it determines the following conditions exist at the Property: i) parking occurs outside the designated parking stalls, in driveways, fire lanes, or in green space due to insufficient on-site parking or ii) off-site street parking occurs attributed to Compass Pointe tenants or guests. If the Developer is required by the City to construct the Additional Parking, Developer shall also provide "No Parking and "Subject to Ticketing" signage in the driveway and fire lane if violations occur. 9. The Applicant shall provide a snow removal plan to be included in the Agreement. The snow removal plan should include provisions that allow the City to require snow removal for the following items: a) The Developer/property owner of the Project shall be responsible for snow removal on the public sidewalks along West Broadway and 62nd Avenue. This requirement is in consideration for reduced setbacks that limits snow storage in these areas. The snow removal must be in conjunction with parking lot plowing. Sidewalks must be cleared to allow safe pedestrian passage year round. Snow shall be hauled off the site by Developer/property owner of the Project if sidewalk snow storage becomes a problem for the Project, survival of the landscaping is jeopardized or traffic visibility is negatively affected by the snow storage at the 62 Avenue and West Broadway intersection or either of the site access points. b) Snow must be removed from all internal sidewalks to allow safe pedestrian passage year round. c) Parking lot snow shall be stored in designated snow storage areas. Snow must be hauled offsite if the following conditions oc=: i) Snow storage shall not be allowed in the constructed parking stalls, ii) Snow storage shall not reduce the available required parking, iii) Snow storage shall not result in damage of in-place landscaping, iv) Snow storage shall not 3 interfere with traffic visibility at the site access points, v) Snow storage shall not extend more than two feet above the eight foot tall boundary line fence. 10. Bicycle parking shall be provided meeting the following conditions: a) Developer shall provide design detail of bike racks for an evaluation of parking capacity. b) Developer shall remove bike rack from green space/snow storage area and provide hard surface for bike parking. c) Developer shall provide additional bike parking on west end of the building. 11. A pedestrian sidewalk shall be provided through the activity area to the western fence opening. 12. Developer shall execute and deliver to the City that certain Agreement to Maintain Underground Stormwater Storage System attached to this Agreement as Exhibit C. 13. Drainage and utility plans provided by Developer shall be subject to the approval of the City Engineer. 14. Developer shall provide a landscaping plan reasonably acceptable to the City and subject to the following conditions: a) any landscaping that dies or shows stress unacceptable to the City shall be replaced by Developer or the property owner as provided by the plan. b) any planting or site improvements located in the public right of way or easements may be removed by the City in conjunction with City projects. Replacement of the landscaping andlor improvements shall be the Developer's or property owner's responsibility at their cost. 15. Developer shall provide a detail of the eight foot boundary line fence which shall be subject to City approval. 16. If not previously approved, all building signs shall be subject to approval by the City Council. 17. Light intensity regulations at the right of way lines and along 62nd Avenue were approved by the City Council at its February 24, 2014 meeting. The resolution of the City Council dated February 24, 2014 approving various items related to the Project shall be amended to reflect such approval. 4 IS. Developer small comply with all ministerial matters set forth in the New Hope City Code and required by the City, including but not limited to, those of the City Engineer and Public Works, Community unity Development, City Manager and Clerk and the City Attorney, i.e. title examination, execution of the Agreement, filing of letters of credit and payment of all City fees for Planning Case 14-03. 19. The site plans and building plans submitted by Developer as part of Planning Case 14-03 shall be subject to the review and approval of the New Hope Fire Marshall. 20. Construction of and maintenance of the Project and Property shall comply with the plans submitted by Developer as part of Planning Case 14-03, this Agreement, subsequent approvals and local, state and federal laws, rules and regulations. 21. The Final Plat for Compass Pointe mast be filed and recorded within a reasonable time. If the Final Plat is not timely filed or recorded, upon thirty (30) days written notice from the City to the Developer, this Agreement and all approvals herein shall be void with no further action required by the City Council NOW, THEREFORE, IT IS HEREBY AGREED as follows. L INCORPORATION OF RECITALS. The recitals above are incorporated herein by reference, specifically including the conditions for this PUD Site Improvement Agreement. 2. THE WORK. The Work shall consist of the site improvements described in the Plans, including the Secured Work as described below, and including any amendments to the Plans which are approved by the City Council. The Work: shall be performed by the Developer to the City s reasonable satisfaction and in compliance with all applicable codes, ordinances, standards, and policies of the City. 3. THE SECURED WORK. The Secured Work includes all on-site exterior amenities shown on the Site Plan as described by the City Engineer's April 10, 2014 Memorandum that is listed below: Improvement - Estimated ela a. Demolition $3,000.00 b. Utilities $15,000.00 c. Private Driveway $22,000.00 d La &cmiug Restoration $7.000.QQ Subtotal $47,000.00 + 50% continM $23.500.00 Letter of CTeditBond amount required $70,500.00 The Developer shall maintain all Secured Work for as long as the Property is zoned PUD District 12-04. 4. COMPLETION. The Developer agrees that the Work sha11 be completed in its entirety on or 5 before the 31 " day of December, 2015 (the Completion Date), except as this period of time is extended by resolution of the City Council, or by the City taking no action to require completion hereunder on a timely basis. It is understood and ag =d that failure of the City to promptly take action to draw upon the bond or other security to enforce this Agreement after the expiration of the time in which the Work is to be completed hereunder will not waive, estop or release any rights of the City and the City can take action at any time thereafter to require completion of the Work, and payment for same. Furthermore, the term of this Agreement shall be deemed to be automatically extended until such time as the City Council declares the Developer in default hereunder, and the statute of limitations shall not be deemed to commence running until the City Council has been notified in waiting by the Developer that the Developer has either complied with this Agreement, or that it refuses to for any reason. These provisions shall be applicable to any person who shall give a financial guarantee to the City as required below. S. COST OF WORK. The Developer shall pay for all costs of persons doing work or famishing skill, tools, machinery or materials, or insurance premiums or equipment or supplies and all just claims for the same, and the City shall be under no obligation to pay the Developer or any subcontractor any sum whatsoever on account thereof, whether or not the City shall have approved the subcontract or subcontractor, and the Developer and its surety shall hold the City harmless against any such claims, and provide the City with all necessary lien waivers. 6. DEFAULT. In the event of default by the Developer as to any of the Secured Work to be performed hereunder, the City may, at its option, perform the Secured Work and the Developer shall promptly reimburse the City for any expense incurred therein by the City, provided the Developer is first given written notice by United States Mail of the Secured Work in default and required to be done by the Developer, not less than thirty (30) clays being given thereby to the Developer to remove the default status, said notice being addressed to the Developer at the address set forth below. Notice given in this manner being sufficient as described, by agreement of the parties hereto. Notice to the Developer shall also constitute, without fiuther action, notice to any contractor or subcontractor, whether they are approved and accepted by the City or not. In the event of emergency, as determined by the City Engineer, the thirty (30) day notice requirement to the Developer shall be and hereby is waived in its entirety by the Developer, and the Developer shall reimburse the City for any expense so incurred by the City in the same manner as if mailed notice as described above had been given It is understood by the parties, however, that the responsibility of the Developer is limited by strikes and force majeure. M 7. REVOCATION OF RENTAL PERMITS. The City Council approved this PUD Site Improvement Agreement for the construction of a 68 unit apartment complex on the Property subject to certain conditions including completion of the Work and compliance with the provisions of New Hope Ordinance No. 12-06. As an additional remedy separate and independent from any other remedy available to it, upon a breach of this Agreement by Developer that materially and adversely affects the use of the Property, the City may revoke The rental permits for the Property required by New Hope Code §3.31 et. al. Developer acknowledges and agrees that the City may also revoke the rental permits for the Property for failure of the Developer to satisfy any of the other conditions of this PUD Site Improvement Agreement when such failure materially and adversely affects the use of the Properly. Upon any breach or default by the Developer as described in this Section 7, the City shall provide thirty (30) days' notice and right to cure any such breach or default prior to the revocation of any rental permit to the Developer and its investor limited partner (the "Limited Partner"). The Limited. Partner shall have the right, but not the obligation, to cure any such breach or default by the Developer and the City shall accept performance by the Limited Partner of any obligation of the Developer as though tendered by Developer itself, provided such performance by the Limited Partner has occurred during the thirty (30) day cure period provided in this Section 7. S. ADMMSTRATION COSTS. Developer agrees to reimburse the City for the actual costs to the City associated with Planning Case 1403 and this Agreement, including but not limited to, planning consultant, engineering and attomey's fees. Developer agrees that the fmancial guarantee shall not be released until all such costs have been paid to the City. 9. HOLD HARMLESS. Except with respect to the gross negligence or willful misconduct of the City, its agents, employees, or representatives, the Developer agrees to indemnify and hold harmless the City and its agents, employees, and representatives against any and all claims, demands, losses, damages and expenses (including attorney fees) arising out of or resulting from the Developer's negligent or intentional acts, or any violation of any safety law, regulation or code in the performance of this Agreement, without regard to any inspection or review made or not made by the City, its agents, employees, or representatives, or failure by the City, its agents, employees, or representatives to take any other prudent precaution. in the event any City employee, agent or representative shall come under the direct or indirect control of the Developer, or the City upon the failure of the Developer to comply with any conditions of this Agreement, performs said conditions pursuant to the financial guarantec,the Developer shall indemnify and hold harmless the City, its employees, agents and representatives for its own negligent or intentional acts in the performance of the Developees required work under this Agreement. 10. COST OF ENFORCEMENT. The Developer agrees to reimburse the City for all costs incurred by the City in the enforcement of this Agreement, or any portion thereof, including court costs and reasonable engineering and attomey's fees. 11. FINANCIAL GUARANTEE. The Developer shall Amush the City with a financial guarantee acceptable to the City in one of the following forms: a) cash escrow; b) an irrevocable letter of 7 credit; c) an automatically renewing certificate of deposit in Developer's name but irrevocably assigned to the City; d) other financial instruments which provide equivalent assurance to the City. Said financial guarantee shall be furnished to the City as security to assure completion of the items of Secured Work as set forth above, and payment of the costs of administration as set forth above. The financial guarantee shall be in an amount of $70,500.00. The financial guarantee provided shall continue in full force and effect until the City Council approves and accepts all of the Secured Work undertaken and releases the surety and/or the Developer from any further liability, and until all administrative costs are paid in frill. The City Council may reduce the amount of the financial guarantee upon partial completion of the Secured Work and payment of all outstanding administrative costs. 12. CITY ACKNOWLEDGMENT. The Project was mistakenly referred to as a '`market rate" apartment development in City Council Resolution 2014-36. The City aclmowledges that the Project is an affordable apartment development financed using Low Income Housing Tax Credits and any references to "market rate" in City Council Resolution 201436 or other similar documents or resolutions shall be corrected to "affordable." 13. NOTICE. The address of Property Owner and Tenant, for purposes of this Agreement is as follows, and any notice mailed by the City to these addresses shall be deemed sufficient notice to Property Owner and Tenant under this Agreement, until notice of a change of address is given to the City in writing: If to the Developer: Compass Pointe Limited Partnership 7500 West 7e Street Edina, MN 55439 Attention: Ronald E. Clark With a copy to: V,rmthrop & Weinstine, P.A. 225 South Sixth Street Suite 3500 Minneapolis, MN 55402 Attention: Jeffrey J. Koerselman If to the Limited Partner: Wells Fargo Affordable Housing Community Development Corporation MAC D1053-170 301 South College Street, 116 Floor Charlotte, NC 28202-6000 14. SEVERABILITY. If any portion, section, subsection, paragraph, sentence, clause or phrase of this Agreement is for any reason held to be invalid, such decision shall not affect the validity 8 ofthe remaining portion of this Agreement 15. SUCCESSION. This Agreement shall be binding upon the parties, their heirs, successors or assigns, as the case may be. IN W rNESS WHEREOF, we have hereunto set our hands and seals. CITY OF NEW HOPE By: 44. 4JI41, Its Mayor ZABy: ' Its tify Manager COMPASS POINTE LDUM PARTNERSHIP By: Compass Pointe LLC Its General Partner By: Ronald E. Clark Its Chief Manager STATE OF MINNESOTA } ) ss. COUNTY OF HEAINEPIN ) foregoingenL was acknowledged before me this .� day of 201 by thi Hemkea and Kirk McDonald, the Mayor and Manager, respectively, of the City of New Hope, a Minnesota municipal corporation, on behalf of said municipal corporation. Notary Public �,.aww..n..AC.�M�.,,ba,0.rJS.W1A1'I.1l�J.`•+.iJ4r r� of the remaining portion of this Agreement. 15. SUCCESSION. This Agreement shall be binding upon the parties, their heirs, successors or assigns, as the case may be. IN WITNESS WHEREOF, we have hereunto set our hands and seals. CITY OF NEW HOPE By: Its Mayor By: Its City Manager COMPASS POINTE LIMITED PARTNERSHIP By: Compass Pointe LLC Its General Partner By: /..,4/ Eaw Ronald E. Clark Its Chief Manager STATE OF MNNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of ,201 by Kathi Hemken and Kirk McDonald, the Mayor and Manager, respectively, of the City of New Hope, a Minnesota municipal corporation, on behalf of said municipal corporation. Notary Public 9 STATE OF MINNESOTA ) )Ss. COUNTY OF .k�id r. n ) SARAH MARY bULONG Notary P4d;Ao Nnnasda W 13 esJtan 81, 2017 The foregoing instrument was acknowledged before me this 27 day of 'M , 201 , by Ronald E. Clark, the Chief Manager of Compass Pointe LLC, a Minnesota limited liability company, the general partner of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of said limited liability company and limited partnership. 1U77; Iai1_► JENSEN SONDRALL & PERSELLIN, P.A. 8525 Edinbrook Crossing, #201 Brooklyn Park, MN 55443 (763) 424881.1 PmftmrAs"tamoriAWCftyafNawH*Wn4WCmap WF&taWe:iffi0edaayl0ta PWPWft FW 3"kPwMW A,VW1d4d= 91931070 10 6>141 OlAt4� 19 AGREEMENT TO MAINTAIN UNDERGROUND STORM WATER STORAGE SYSTEM THIS AGREEMENT is made and entered into as of the Adt day of 2014, by and between Compass Pointe Limited Partnership, a Minnesota Limited Partners (' veloper") and the City of New Hope, a Minnesota municipal corporation ("City"). WITNESSETH: WHEREAS, the Developer owns certain real property located in the City of New Hope, County of Hennepin, State of Minnesota, legally described as follows (hereafter Property): Lot 1, Block 1, Compass Pointe, according to the duly recorded plat thereof, Hennepin County, Minnesota, WHEREAS, permanent provisions for handling of storm water runoff on the Property as provided in that certain Stormwater Management Operations and Maintenance Plan for Compass Pointe attached hereto as Exhibit A (the "Maintenance Plan") are acceptable to the Shingle Creek Watershed, including provisions for operation and maintenance of all stormwater runoff facilities and detention ponds, as required, and such provisions are set forth in this Agreement; and NOW, THEREFORE, in consideration of mutual covenants of the parties set forth herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. Maintenance of the Underground Storm Water Storage. System. The Developer and its successor or assigns as fee owner of the Property shall be responsible for maintaining and observing all Drainage Laws governing the operation and maintenance of the underground stormwater storage system located at the Property (hereafter, the "System"). The Developer shall provide the City with a schedule acceptable to the City for Developer's inspection of the System and its outlet control structures. The Developer shall make all such scheduled inspections, keep records of all inspections and maintenance activities, and submit such records annually to the City. The cost of all inspections and maintenance of the System shall be the obligation of the Developer and its successors or assigns as the fee owner of the Property. Further, the Developer and its successors or assigns, shall meet all of the requirements of the City's MS4 permit relating to the System and comply with all structural storm water best management practices (BMP's) as determined by the City. �. LLC i�NLa Commercial Partners Title C&- 2 00 South Stith Suite 1300 379 V 2— 6 �( `� of Minneapolis, MN 55402 2. City's Maintenance Rights. The Developer acknowledges and agrees the City may maintain the storm water structures constructed on the Property, as provided in this paragraph, if the City reasonably believes that the Developer or its successors or assigns have failed to maintain the storm water structures in accordance with applicable Drainage Laws and BMP's, and such failure shall continue for thirty (30) days after the City shall give the Developer written notice of such failure. The City's notice shall specifically state which maintenance tasks are to be performed. If Developer shall not complete the maintenance tasks within thirty (30) days after such notice is given by the City, the City shall have the right to enter upon the Property at any reasonable time to perform such maintenance tasks. In such case, the City shall send an invoice of its reasonable maintenance costs to the Developer or its successors or assigns, who shall pay said costs within thirty (30) days of receipt of said invoice. Notwithstanding the foregoing, in the event of an emergency, as determined by the City Engineer, the thirty (30) day notice requirement to the Developer for failure to perform maintenance tasks shall be and hereby is waived in its entirety by the Developer, and the Developer shall reimburse the City for any expense so incurred by the City in the same manner as if written notice as described above has been given. The Developer agrees the City may levy and collect its maintenance costs as a special assessment against the Property's real estate taxes in the event the City fails to receive payment of the maintenance costs in accordance with this paragraph. Developer further agrees the maintenance costs incurred by the City per this paragraph result from the City's elimination of a public health or safety hazard from private property per Minn. Stat. §429.101. 3. Hold Harmless. Except with respect to the gross negligence or willful misconduct of the City, its agents, employees or representatives, the Developer agrees to indemnify and hold harmless the City and its agents and employees against any and all claims, demands, losses, damages, and expenses (including reasonable attorneys' fees) arising out of or resulting from the Developer's or the Developer's agents or employee's negligent or intentional acts, or any violation of any safety law, regulation or code in the performance of this Agreement, without regard to any inspection or review made or not made by the City, its agents or employees or failure by the City, its agents or employees to take any other prudent precautions. in the event the City, upon the failure of the Developer to comply with any conditions of this Agreement, performs said conditions pursuant to its authority in this Agreement, the Developer shall indemnify and hold harmless the City, its employees, agents and representatives for its own negligent acts in the performance of the Developers required work under this Agreement, but this indemnification shall not extend to intentional or grossly negligent acts. 4. Costs of Enforcement. The Developer agrees to reimburse the City for all costs incurred by the City in the enforcement of this Agreement, or any portion thereof, including court costs and reasonable attorneys' fees. 5. Notice. All notices required under this Agreement shall either be personally delivered or be sent by certified or registered mail and addressed as follows: 2 5. Notice. All notices required under this Agreement shall either be personally delivered or be sent by certified or registered mail and addressed as follows: To the Developer: Compass Pointe Limited Partnership 7500 West 78"' Street Edina, MN 55439 Attention: Ronald E. Clark To the City: Kirk McDonald, City Manager City of New Hope 4401 Xylon Avenue North New Hope, MN 55428 All notices given hereunder shall be deemed given when personally delivered or two (2) business days after being placed in the mail properly addressed as provided herein. 6. Successors. All duties and obligations of Developer under this Agreement shall also be duties and obligations of Developer's successors and assigns. 7. Effective Date. This Agreement shall be binding and effective as of the date hereof. DEVELOPER, COMPASS POINTE LIMITED PARTNERSHIP, a Minnesota limited partnership By: Compass Pointe LLC Its: peneral Partner By: 11a'-0 OL -W Ronald E. Clark Its Chief Manager STATE OF MINNESOTA ) ) ss. SARAH MARY D1 LONG COUNTY OF fi'tY1e�u-y ) Notary Public -Minnesota �... My Codon aphaJMn 31.2017 The foregoing instntment was acknow edged before me this bti ay of dune, 2414, by Ronald E. Clark, the Chief Manager of Compass Pointe LLC, a Minnesota limited liability company, the general partner of Compass Pointe Limited Partnership, a Minnesota limited partnership, on behalf of such limited liability company and Iimited partnership. �AWL2491L - N, tary Public 3 STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) CITY OF NEW HOPE, By: Kathi Hemken Its Mayor —� -4 k'MLS4 By: Kirk McDonald Its City Manager r� ' l The foregoing instrument was acknowledged before me this 4�3 day of ' 201 K , by Kathi Hemken and Kirk McDonald, the Mayor and City Manager of the City of New Hope, a Minnesota municipal corporation, on behalf said al corporation. Notary Public DRAFTED BY.- JENSEN SONDRALL & PERSELLIN, P.A. 8525 Edinbrook Crossing, #201 Brooklyn Park, MN 55443 (763)424-8811 4 EXHIBIT A MAINTENANCE PLAN (Attached) Stonnwater Management Operations and Maintenance Plan For Compass Pointe New Mope, Minnesota TABLE OF CONTENTS 1. PROJECT DESCRIPTION AND OVERVIEW 2. TRITON UNDERGROUND STORM SYSTEM O&M MANUAL 3. OVERALL SITE UTILITY PLAN 4. TRITON UNDERGROUND STORM SYSTEM. SITE SPECIFIC SHOP DRAWINGS 5. MAINTENANCE LOG Project Description and Overview Compass Pointe is a 68 unit residential apartment building on a 1.7 acre site in New Hope, Minnesota. Due to size constraints on the site, storm water management is obtained by an underground storm water storage system that was developed by Triton Storm water Solutions. A detailed maintenance manual from Triton is part of this maintenance plan. In addition to the underground system there are 18 storm sewer structures on the site. These structures should be inspected for any obstruction by debris or sediment buildup at the same time the underground system is inspected. The storm sewer manhole just West of the underground system prior to discharge into the system is a sump manhole. This should be cleaned of any sediment buildup at time of inspection. Triton recommends as a minimum annual inspections and at 6 months during the first year of operation. T-�ITON swer A Triton" Main He ader Row" O&M ManUal Tdtone Main Header Row' O&M Manual An important component of any Stormwater Pollution Pre- vention Pian is inspection and maintenance. The Triton Main Header Row" is a patent pending technique to inexpensively The Maim Header Row is comprised of many Triton chambers that sit on interconnecting sediment floors that are connec- tioned to a nearby manhole for easy access. At the end of the Main Header Row there is room for an optional Sump Basin Assembly (shown as item 3 in Rgure 2) to help collect and con- tain any sediment that is flushed out of the Main Header Row during a ruin event or maintenance cleaning. The Sump Basin Assembly can be accessed from above via a manhole or up to a 33' (538.2mm) diameter stand pipe. The Main Header Row feeds the distribution rows (shown as item 4 in Figura 2) via a feed or distribution pipe. The feed pipe is at an elevated invert height so the water in the Main Header Row must rise to the invert height before flowing Into the distribution rows to cap- ture the sediment in the Main Header Row. The Main header Row protects the distribution chamber row storage areas from any sediment accumulation. This preserves the infiltration rate enhance enhance Total Suspended Salida CESS) removal and provide easy access for inspection and maintenance. of the area where the distribution rows are installed, allowing the system to perform at the rate for which it was designed. The sediment floors are designed to prevent scouring of the underlying stone and to stop sediment infiltration into the ground under the Main Header Row. The sediment floors lock together and mate with the chambers so they will remain intact during very high flow events and during high pressure cleaning. The Main Header Rawls typically designed to capture the 'first flush" and offers the versatility to be sized on a volume or flow rate basis. An upstream manhole not only provides access to the Main Header Row but typically includes a high flow outlet that contrds excessive storm water flow in or volumes by discharging overflow into surrounding stone or through a mad - fold to the other Main Header Row chambers. The Main Header Row may also be part of a treatment train, By treating storm water prior to entry into the Main Header Row system, service life can Fre extended and pollutants, such as hydrocarbons, can be captured. Pre-treatment best manage- ment practices can be as simple as deep sump catch basins and oil -meter separators or as innovative as storm water treat- ment devices. The design of the treatment train and selection of pre-treatment devices by the design engineer are often driv- en by regulatory requirements. Whether pre-treatment is em- ployed or not, the Main Header Row is recommended by Triton as an effective means of minimizing maintenance requirements and costs. 2 Call Triton at 810.222 7652 for technical and product information or visit www tntonsws Com The frequency of inspection and maintenance varies by loca- tion. A routine inspection schedule needs to be established for each individual location based on alte-specific variables. The type of land use -- industrial, commercial, residential ---antici- pated pollutant bad, percent Imperviousness, climate and so on all play a critical role in determining the actual frequency of inspection and maintenance practices. At a minimum. Triton recommends annual inspections. The Main Header Row should be inspected every 6 months for the first year of operation. In subsequent years, the inspection should be a4usted based an previous observation of sediment deposits. The Main Header Raw incorporates a combination of standard manhole(s) and strategically located inspection ports. The hi- spection ports allow for easy access to the system from the surface, eliminating the need to perform a confined spade en- try for inspection purposes_ The Main Header Row was designed to reduce the cost of periodic maintenance. By capturing sediment in just one row, costs are dramatically reduced by eliminating the need to dean each row along the storage bed. If inspection Indicates the need for maintenance, access is provided via a manhoWz) located on the end of the Main Header Row. If entry into the manhole is required, please foilow local and OSHA rules for confined space entries. The inside dimensions of the Tftn Main Header Row chambers measure 34" (863.6mm) tall by 48" (1219.2mm) wide. If, upon visual Inspection, it is found that sediment has accu- mulated, a stadia rod should be inserted to determine sedi- ment depth. When the average depth of sediment exceeds 1.1 " (279Amm) in the bottom of the Sump Basin and/or if there is 3" t76.2mm) throughout the length of the Main Header Row, the Sump Basin and Main Header Row should be cleaned. Basin and the Main Header How. They can be cleaned using a JetVac process or can be cleaned using a water tank truck or fire truck equipped with a nose to flush the sediment to the Sump BaakL To use a water tanker or fire truck, simply insert the hose into the upstream catch basin stricture and flush the sediment to the end of the Main Header Row where the Sump Basin is located. If the Sump Basin is located close to the inlet, vacuum out the sediment first and then back flush the Main Header Row into the Sump Basin. NOTES The JetVac or high pressure hose process should only be performed on the Whin Header Row where the Tritan Sediment Floor System has been installed. and only if there is 3" (76.2mm) of sedi- ment throughout the length of the Main Header Row Maintenance is accomplished by removing the sediment that has built up in the Sump Basin using a standard vacuum trick as shown to the right. The Triton Main Header Row system was designed for easy access to the Sump Basis via a man- holeAnspection port or up to a 33" (838.2mm) diameter pipe. There is no special process required to clean out the Sump Call Triton at Bio.222.7652 For tectwilcai and product information orviat www t8tonswe.com 3 Triton® Main Header Row' O&M Manual Step 1. Inspect Sump Basin and Wain Header Raw for sediment A. Inspection ports Cif present) 1. Remove lid from floor box frame ii. Remove cap from inspection riser III. Using a flashlight and stadia rod, measure depth of sediment in the Sump Basin and record results In the maintenance log Iv. If sediment is at or above- I V (279.4mm) depth, proceed to S" 2. If not, proceed to step 3. B. All Main Header Rows ii- Remove cover from manhole at upstream end of Main Header Flow ii, Using a flashlight, inspect the Main Header Row through outlet pipe and through each distribution pipia that is connected in between the Mein Header Row and the distribution row of chambers iii. If sediment is at- or above -11' (279.4mm) mark in the sump bin, proceed to Step 2 1. Be sure to have proper footing when entering into Main header Row 2. Fallow OSHA regulations for confined space entry if entering Main Header Row If not, proceed to Step 3 Step 2. Clean out the Sump Basin with a vacuum truck A. Remove any secondary filtration media that may be installed in the Sump Basin B. Vacuum Sump Basin as required Step 3. Replace all caps, lids, and covens Record observations and actions Step 4, inspect and clean catch basins and man- holes upstream of the Tritan system 1j.81 Revised 09/17/09. Supersedes all previous D&M manueis. 703 -2s13 -M L� �• _ '�'.'1 'moi il—I'�If'• .Til=li=il=fl' F` —ilk Revised 09/17/09. Supersedes all previous D&M manueis. 703 -2s13 -M .am° ONI) 79 Z 9A IF W � _ 2 AVEMM .11 114 11 13 i •M1 t.! I Itom goNo Ir�rtirl�� �,.� } I L r r i so ■" � tr�r sails vm'� r InWom Milo opr k3O r f 0 !men � i ,10r�r - 10 = � -low- Now low r i [F` r •• ,r�•:rw�., t�1al� `t �t�• 1/a,p,tL,R•f lys,� r i i lTad.�Pafw�l �t�• 1/a,p,tL,R•f 'APA/08/2614/TUI 13:12 rn C pn m a Q�l r 00 E aco11 -n c� w a v 0 PAX No,6514626990 0 C6 to 00 6 P. 004/006 !I� IAPR/09/2014/TUE 13:12 ROYAL CONOOE FAX h.6514626390 P. 005/006 APR/00/2014/TUE 13:12 ROYAL G1MCRE'fE FAX Ho, 5514626990 P.006/006