121195 EDA Official File Copy
CITY OF NEW HOPE
EDA AGENDA
EDA Regular Meeting #19 December 11, 1995
Agenda #20
Pres/dent Edward J. Er/ck$on
Comm/ss/oner W. Peter Enck
Comm/ss/oner Pat La V/ne Norb¥
Comm/$s/oner Gerald Otten
Commis$/oner Terr/ Wehling
1. Call to Order
2. Roll Call
3. Approval of Minutes of November 27, 1995
4. Update on Autohaus Site Improvements, 7709 42nd Avenue North
(Improvement Project No. 467)
5. Resolution Approving Right of First Refusal for Acquisition of Homeward
Bound Property at 4741 Zealand Avenue North (Improvement Project No.
533)
6. Discussion Regarding Lease Between Phoenix Manufacturing Corporation
and the EDA for City-Owned Building at 7528 42nd Avenue (Improvement
Project No. 474)
7. Adjournment
CITY 'OF NEW HOPE
4401 XYLON AVENUE NORTH
HENNEPIN COUNTY, MINNESOTA 55428
Approved EDA Minutes November 27, 1995
Meeting #17
CALL TO ORDER President Erickson called the meeting of the Economic Development Authority to
order at 9:26 p.m.
ROLL CALL Present: Erickson, Enck, Wehling
Absent: Norby, Otten
Staff Present: Sondrall, Hanson, Donahue, Leone, McDonald, Bellefuil
APPROVE MINUTES Motion was made by Commissioner Wehling, seconded by Commissioner Enck, to
approve the EDA minutes of November 13, 1995. All present voted in favor.
Motion carried.
AUTOIIAUS UPDATE President Erickson introduced for discussion Item 4, Update on Autohaus Site
Item 4 Improvements, 7709 42nd Avenue North (Improvement Project No. 467).
Mr. Donahue stated Autohaus did not deliver the revised plans in sufficient time for
staff to analyze them. It was the consensus of the EDA to postpone discussion until
a future meeting.
ADJOURNMENT Motion was made by Commissioner Enck, seconded by Commissioner Wehling, to
adjourn the meeting. All present voted in favor. The New Hope EDA adjourned
at 9:27 p.m.
Respectfully submitted,
Valerie Leone
City Clerk
New Hope EDA November 27, 1995
Page 1
EDA
Orlgtnatlng Department Approved for Agenda Agenda Sectlon
City Manager EDA
12-11-95
Kirk McDonald '--"% Item No.
By: Management Assistant By:~/~/fi
UPDATE ON AUTOHAUS SITE IM/pROVEMENTS, 7709 42ND AVENUE NORTH
(IMPROVEMENT PROJECT NO. 467)
Thomas Boettcher from Autohaus will be present at the December 1 lth EDA meeting to present an
update on the Autohaus site improvements. The EDA has previously requested an update on the
progress of the improvements, particularly since Universal Color, Inc. has vacated the front portion of
the Autohaus building. Boettcher will be presenting a revised site plan to the EDA and a large copy
of the revised plan is enclosed in your Council packet if you want to review it prior to the meeting.
On April 4, 1991, Autohaus, Inc. and the City of New Hope executed a Development Contract
regarding specific improvements to be made to the Autohaus property, such as the installation of
concrete curb, landscaping improvements, storm drainage improvements, paving and lighting
improvements and the demolition of the Animal Hospital building. The contract called for the
improvements to be made to the property by April 14, 1992. Autohaus subsequently requested several
time extensions to complete the improvements. The most current agreement states that all improvements
will be completed by October 31, 1994. While some of the work has recently been completed (such
as striping of the lot), several items have not yet been completed (landscaping on east and west sides
of property, trash enclosure, etc.). Also, in July, 1994, Autohaus submitted a request to the EDA to
allow the retaining wall they constructed five feet from the property line to remain in place. The EDA
declined to consider the request until an update on all outstanding issues on the plan was presented.
In 1991, the EDA also made a low interest loan to Autohaus in the amount of $187,500 to assist with
the acquisition of the former Animal Hospital site and for development improvements to the site. The
loan was paid back in full this past summer, several years in advance of when it was dUe.
MOTION BY ,~/¢D r' ~' SECOND BY
Review: Administration: Finance:
RFA-O01
Request for Action 2 12-11-95
Staff hope to meet with Autohaus prior to the EDA meeting to discuss the following staff comments on
the plan and the EDA will also want to discuss these issues with Boettcher. Comments include:
1. The original plan showed that the space occupied by Universal Color Lab was to be used in the
future for display area and the revised plan shows that the front portion of the space will be used
for showroom and rear portion of the space will be used for a Service Department. A new
overhead door into the Service Department will be installed on the west side of the building.
2. The original landScaping plan included:
29 Austrian Pines to be planted on the west property line between Autohaus and Country
Kitchen
16 Isanti Dogwood to be planted on the south side of the building
156 Andorra Junipers to be planted along 42nd Avenue
33 Pfitzer Junipers to be planted along east property line between Autohaus and YMCA
property
18 Teclmy Arborvitae to be planted on rear/west property line between Autohaus and
Country Kitchen
While some landscaping has been completed at the front of the site, the majority of the plantings
included on the original plan have not been completed. The revised plan does not include a
landscape schedule with plant name or quantity. The revised plan shows coniferous trees (6)
along the west property line, deciduous trees (4) along the east property line and shrub plantings
along 42nd Avenue. The landscaping portion of the revised plan needs to be more specific, and
staff is concerned that the landscaping has been reduced from the original plan.
3. The original plan showed a 10-foot setback between the sidewalk and the front display area for
plantings. A retaining wall was installed 5 feet from the sidewalk and this is shown on the
revised plan. Autohaus desires to keep the retaining wall in place.
4. The original plan showed an outdoor trash enclosure to be installed on south side of the building,
as does the revised plan; but the enclosure has not been completed.
5. Autohaus has made application for a sign variance for new canopy wall signs which will be
considered in January. They will also be making improvements to the existing center ground
sign and have indicated that the second ground sign on the northeast side of the property will be
removed.
6. The revised plan shows
A. one 48" elevated auto display at the northeast corner of the property,
B. one 48" (to be changed to a 24") elevated auto turntable display in front of the property,
and
C. one 24" elevated auto display at the northwest corner of the property.
The elevated auto displays were not included on the original plan.
Request for Action 3 12-11-95
The parking lot was recently striped and Autohaus has indicated that the lot will be sealcoated and re-
striped in 1996. They. also have plans to repaint the building.
The major issues that need to be discussed/resolved are the landscaping, retaining .wall/setback and the
auto display turntables. After these items have been resolved, staff recommends that the agreed upon
changes be incorporated into the site plan and that a revised Addendum be prepared/executed to define
the timetable for completion.
ADDENDUM TO CITY OF NEW HOPE
DEVELOPMENT CONTRACT
1. Parties. T,.h.e parties to this Addendum are the City of New
Hope (hereafter City), Autohaus of. Mtnneapo11 s, Inc.
(hereafter Autohaus) and Thomas W. Bosttcher, individually
(hereafter Boettcher).
2. Pronerty. The real property (hereafter Property) to which the
this Addendum applies is owned in fee by Boettcher and is
.. !ocated tn Henneptn County, Minnesota, legally described as:
(See attached Exhibit A)
3. Purooae. This Addendum shall modify the that certain
Development Contract dated April 4, 1991 (hereafter Contract)
entered into by the parties. Autoheus and Boettcher
acknowledge and agree that they are in breach of the
performance conditions of the. Contract and in consideration
'for the City's agreement not to immediately pursue its
remedies under the terms o.f the COntract Boettcher and
Autohaua have agreed to enter into this Addendum.
4. UnPerformed Conditions. Specifically, Autohaus and Boettcher
acknowledge and agree that they have failed to Perform all the
requirements of paragraphs 2.A) through I) and 3 of the
Contract. With respect to. the work required 'by. thos®
provisions the 'parttes hereto agree'- that Autohaus~ and.
$oettcher wtll perform the work ae folYOws: '
a.) l'~e Installation of concrete curb from the moat southerly
' ' ' wall of the but ldtng northward to County Road No. g shall
be completed by October 31, 1993. The rem&tnder of the
COMPLETED. curbing aa shown on the site plan shall be installed by
· October 31, 1994, except that curbing around the
perimeter of the unpaved body shop and repair, storage
&re& eh&Il-be Installed if and when said body ~hop and'
r~tr storage area ia paved aa met forth below. All
cq~t~ng aha11 be of a surmountable type aa approved by
tll~TOtty. Autohaue and Boettcher shall submit a diagram
of e&1d' curbing for approve1 to the Ctty prtor to
i natal 1at ton.
b.) ' All planttnge chown' on the site plan north of the
butld'tng's moat southerly wall shall be Installed by
NOT October 31, 1993. All other plantings shown on the site
COMPLETED plan shall be'installed by October 31, lgg4.
c.) The six-foot opaque security fence around the perimeter
of the body shop and 8Ollision repair storage area shall
COMPLETED be installed by October 31, 1994. The existing fencing
.shall remain in place until the new security fence' is
instal 1 ed.
d.) The installation of lighting shown on the site pla..n shall
be completed by October 31, 1993. However, the parties
COMPLETED agree t'hat the existing lighting for the collision repair
area as of the date of this Addendum is adequate and no
further lighting is required notwithstanding the lighting
required by the site plan.
e.) All planted areas completed in 1993 will be sprinkled by
PARTIALLY October 31, 1993. All planted areas completed in 1994
COMPLETE will be sprinkled by October 31, 1994.
f,) The installation of the outdoor trash enclosures will be
NOT DONE completed by October 31, 1994,
CDOMPLETEg') The front display area will be completed by October 31,
PAVING
1993. However, the parties agree that the front display
STRIPING NEEDS TO BE area can be paved with concrete and bituminous.
DONE--NO HANDICAPPED
SPACES h.) The ielande in the transport lane area will be installed
NOT DONE by October 31, 1994. ,.
t.) Erosion control measures of grading and seeding in a form
and manner approved by the City Engineer shal 1 ' be
c~pleted by October 31, 1993. The erosion control
meesuree shell apply to all unpaved areal.
j.) The City agreem to waive indefinitely ther'equtrement
the Contract that Autohau~ and ~ettcher pave'the body ·
sho~ and repair ~torage area. He. ever, .tf'-Autohaua and
Boett.~her elect to p~ve the body shop ~nd 'repair storage
Boettcher w411 be r~uired to tn~tA11, prior to
~avtng, the publtG atom water drainage Improvements
rmqutred by ~(ra~rm~h 3 of the Contrm~t. And, prior to
Installing a~td ,to~ water drainage tmprov~ent,,
~_~aoe ~d-the City must agree on the feasibility
~-paint of the cost of ~ald stem water drainage
ITEMS THAT NEED TO BE COMP.LETED: LANDSCAPING
.AS. ,C OSU E
~ -- STRIPING
TRANSPORT LANES
2
5. Nonmerqer. The parties agree that the terms of the Contract
and this Addendum shall survive the satisfaction, re]ease or
termination of the April 4, 1991 Mortgage, Security Agreement
and Fixture Financing Statement given by Boettcher, and
Autohaus and Boettcher shall be required to perform a]] work
set forth above even if said Mortgage, Security A9reeme.nt and
Fixture Financing Statement is satisfied, released, or
terminated.
e. ~ecurity. The subdivision bond or other security required of
Autohaus and Boettcher to ensure their performance under the
Contract shall be reduced to $1,000.00.
7. Effect of Addendum. The parties agree that this Addendum
'shall not change the other provisions of the Contract, which
shall remain in full force and effect. This Addendum shall be
"construed as supplemental to and not inconst'stent .with the
Contract· The parties further agree that .a.breach of this
Addindum sh&11 also constitute a breach of .the. April 4, 1991
Mortgage, Security Agreement and Fixture Financing. Statement
given by aoettcher.to secure the April 4,-1991 Mortgage Note
executed by Boettcher. Autohaus further agrees that the
assignment of the Certificate. of Deposit given as financial
security to insuri performance of. the-Contract shall subject'
to reduction aI set forth ,-above, &1so extend to' secure
performance under thtI Addendum.
Dated: ~ By
D&ted: ~
ltvidually
3
.~401 Xvlcn Avenue NOrtt~ TeleOhone: 6~2-531.5100 Oty Hail ¢ax. =~'2. ~..:'
New Ho~e. Minc, esofa 55428.4898 TDO Line: 612-531.5109 Police Fax: :5~2..~j,
Put~hc Wor~s Fax:
July 27, 1994
Mr. Thomas Boettcher
Autohaus of Minneapolis, Inc.
7709 42nd Avenue North
New Hope, MN 55427
Subject: REQUEST TO ALLOW FRONT RETAINING WALL TO REMAIN IN PLACE
FIVE FEET FROM PROPERTY lINE
Dear Mr. Boettcher: ,.
At the luly 25th' New Hope Economic Development Authority meeting, the City Manager
presented your letter to the EDA requesting to allow the exisfin~ retainin8 wall to remain in
place five feet from the pmpert7 line, due to the fact that Universal Colour Lab, Inc. wQl be
extending their lease and the plan for the front display area will be delayed. Th~ EDA declined
to grant the request until an update ~ all outstanding is,roes on the plan is presented.
The ED A indicated that th~ do no~ warn to amend the existin~ Development Agreement for "
only the retalnin~ wall hsue if other cha~es also m~d to'be made. As you are aware, all
landscaping ami site im?roveme~ (iacludi~ those in the rear of tbe buildi~) are to be
completed by thi., fall. Tae EDA wants an update on all oumandi~ issues before it will
consider your request to allow the ~ wall to remain in place, and the City cannot proceed
'with any curb i .m!~'ov~ on your property in conjUacfioll with the 42ad Avenue
L~da~l~gi~~ Improvement Project until the retalnin~ wall issue is resolved.
I have enclose~ · copy of the most recently revised agreement between the City itnd Autohaus.
Please review ~ ~ and respond in writin~ re/ardi~ the outstaading improvements to
be complet~L Also, ple~e l~ Dan or myself know if you will be able to auend an upcoming'
Couacil/EDA meefi~ ~o amwer the EDA's 'questions so tim we can move forward on this
matter.
Family Styl~l City ~ For Family Livin~
Mr. Thomas Boettcher
Suly 27, 1994
Page 2
Sincerely,' "
Daniel $. Dormhue
City Manager
Kirk McDonald
Management Assistant/ ~' · .... .
Community Development Coordinator .: .....
Enclosure: Development Agreement
cc-.'. Dan Donahue, City Manager -
Steve 5ondrall, City Attor~y
Mark Hanson, City Eng~r
Doug Sandstad, B~ilding Official --
Improvement Project #467
COUNTY ROAD "o NO. 9
16' ~ 61'
I
12'1 e,..6, i ~6, I ~2' I 16, I 8,.6. I
19'
euroeo~v _ / ~
-~---~ J~utohaus 30. ~,~;o~ hauS
I ............................ * ~*;:: **:::*=**:: *"******* ~*j I
I
,/,..,.,.
EDA
t REQUEST FOR ACTION
Originating Department Approved for Agenda Agenda Section
City Manager EDA
{11-95 Kirk McDonald ! Item No.
By: Management Assistant By: . 5
RESOLUTION APPROVING RIGHT OF FIRST REFUSAL FOR ACQUISITION OF HOMEWARD
BOUND PROPERTY AT 4741 ZEALAND AVENUE NORTH (IMPROVEMENT PROJECT NO. 533)
The enclosed resolution, which authorizes the Mayor and City Manager to execute a Right of First
Refusal Agreement for the acquisition of the Homeward Bound property at 4741 Zealand Avenue North,
has been prepared by the City Attorney for consideration by the EDA. The EDA has indicated an
interest in the use of the property in the event that it is sold by Homeward Bound and the EDA has been
working with representatives from North Ridge/CareBreak for the possible location of an adult day care
facility at the site.
The enclosed Right of First Refusal permits Homeward Bound to freely market the property, but
provides the EDA with the opportunity to match any purchase offer for its acquisition. In other words,
the EDA would have to buy the property pursuant to the same terms and conditions being offered by
a third party. If the EDA would not meet the offer, then Homeward Bound would be free to sell the
property to the third party without any claim of right by the EDA. The terms of the attached agreement
are that the EDA would pay $500 in consideration for its right to match any third party offer.
Staff recommends approval of the resolution.
-!
Review: Administration: Finance:
RFA-O01
DEO-06-@5 ~ED 13:46 ?,02/09
Com~ICX & SONO~.LL, P,A.
Edinburgh E~ O~ce P~
8525 Edi~b~k Crossing
~uitc
Drooklyi~ P~k, ~CSO~
December 6, 1995
Mr, Daniel d. Oonahue
City Manager
City of New Hope
4401Xylon Avenue North
New NoDe, MN 55428
RE: New Hope EDA/RighT Of FirSt Refusal for Homeward
Bound Property
Our File No: 99,11101
Dear Dan:
Please find enclosed a Resolution AUThOrizing Execution of the
Right of First Re¢usa] for the Homeward Bound property by the Mayor
and City Manager for consideration at the December 11~ 1995 Counctl
meet ing.
[ took the liberty of making a $600' offer to Homeward Bound for the
execution of th~s document. It is my op~nton $500 ~s ~easonable
oonsiderat~on for the EDA'S right To match any third ~arty offers
for the Homeward Bound DroperTy. If we exercise our right to
acquire the property pursuant to this document, the $500 payment
will be applied to the purchase price of the property.
Please contact me if you have any ~uestions about the contents of
this document.
Very truly yours,
Steven A. Sondrall
EnclOsure ~
co: Va~erie Leone (w/eno)
,
DE0-06-86 WED 1S:4¥ P, 03/09
December 8,
~. Donna Noverman
Executive
4741 Zealand Avenue North
New Hope, MN 5542S
RE; New Hope EDA/Rigr~t O~ FirSt Refusal to Acquire Property
Please find enclosed a proposed Right of First ~efusa3 you have
discussed with both the N~w Nope'M~yor a~d City ~&nager. This
~ocument ~s submitted ~n connection with your org~nlz~tion's
~n New Hope,
As you are aware, the New Nope ~¢onomtc Developmen~ Authority is
very interested in ~he use of your property in t~e event your
organization decides ~o sell it. AS you are aware, we are ~orklng
With the peo01e ~t North Ridge for the possible tocatio~
~dult da~ care ?~cility in the City, ~nd your proper'ty ~ouiQ be
very suitable ~or such ~
The enclosed Righ~ of First Refusal permits you to freely market
your pFoperty but ~mply provide~ t~e New HOpe EDA w~th the
opportunity to match any purchase offer for ~ts acquisition. In
other words, we woutd have to buy the property pursuant to the same
terms and conditions being offered by s third party, if the New
Hops EOA ~OeS not meet the offer, then ~ou are ~rae to ~e~
the third party wlth~ut ~ny claiffi o~ right by th~ New Hop~
The New Hope EPA woutd p~y ~500 in con$iQer~t~o~ for ~ts
match ~n¥ third p~rty offer pursuant ~o this ~ight of
DEC-Q6-95 ~ED 13:4'~ P, 04/09. .
Ms. Donn~ Hover~an
December 6, 1995
P~ga 2
p rope rt y,
P~aa~e do not he~t~t~ to co¢~t~ct me wi~h ~ny Questions yoa m~ght
have About the enclosed docu¢lent.
Very truly yours, [
BY ST~EN A. SONDR~L
.~'
co: D~n{el d. Oon~hue, C~ty M~n~ge~~
EPA RESOLUTION NO.
,.
RESOLUTION APPROVING RIGHT OF
FIRST REFUSAL FOR ACQUISITION
OF HOMEWARD BOUND PROPERTY AT
4741 ZEALAND AVENUE NORTH
WHEREAS, the Economic .Development Authority in and for the
Oity o~ New Hope hereby determines it is in the best interest of
the city of New Hope to cbntrol the use of the property at 4741
Zealand Avenue North, and
WHEREA~, the Economic Bevelooment Authority in and for the
City of New Hope is specifically working with Senior Outreach
Services, Ino., e non-profit corporation to establish an adult day
care facility within the City, and
WHEREAS, it is hereby determined that the property at 4741
Zealand Avenue NOrth m&y be s suitable property for an adult day
care facility usa.
NOW, THEREFORE~ BE IT RESOLVED by the Economic Development
Authority in and for the City of New Hope as follows:
1. The Preslaent and EXeCUtive Director of the Economic
Development Authority (n and for the City of New Hope are
hereby authorized to sign the attached Right of First
Refusal providing the Economic Development Authority in
and for the City of New Hope an option to match, any offer
submitted to Homeward Bound~ Inc. for the acquisition o~
the property at 4741 Zealana Avenue NOrth.
Adopted by the Economic Development AUthOrity in and for the
Ctty o( New Hope this 11th day of Becember, lgg~.
Edw. d, Erlckson~ President
Attest:
Daniel d · Donahue, Execut i~,ve Dtrector
DE0-06-95 13:48 P, 06/09 ,
RIGHT OF FTRST REFUSAL
WHEREAS, Homeward Bound, [nc., a Minnesota non-profit
corporation (the Owner) is the fee owner of certain real estate
located in Hennepin County, Minnesota, leg&lly described as=
The South 332.43 feet of the West I/2 of the Northwest Quarter
the Southeast Quarter of Section 7, Township 118, Range 21,
except the East 360 feet of the South I80 feet thereof,
according to the Government Survey thereof;
(the Property), and
WHEREAS, the Economic Development Authority in and for the
City of New Hope (the EDA) wishes to obtain a right of first
refusal for Durchase of the Property.
NOW, THEREFORE, in consideration of the mutual covenants set
forth herein, the Owner mhd the EDA ~gree as follows:
1. N_O. tiqe of ProposeU Sale. The Owner shall give the EDA
written notice by certified mail or person&l service of any signed
purchase mgreement for all or ~ part of the Owner's interest in the
Property, including the terms and conditions of said proposed
The Owner shall include a contingency clause referring to this
right of first refusal in any purchase agreement involving the
P rope r t y,
2. Exercise of..Omt.~on. The ED^ shall hsYe 30 days from date
of re~elpt of s~id notice within whic~ to exercise the option to
purchase the ~nterest of the Owner in t/he Property upon the same
terms and conditions a~ contained in sai~ Purchase Agreement. The
EDA shall exercise the option by delivering to t~e Owner, or by
re~ording with t~e Registrar of Titles, notice that the EDA wil~
purchase the Owner's interest in the Property. A closlng of the
sa~e/purchase shall then take pl~e within a reasonable time after
the exercise of this Option, I '
3. Non~E~erci..~e of Optio~, [f the EDA fails tO exercise
said right to ~pur~hase the property by COmDlyi~g with the terms
above, the EDA'S right of first refusal shall become null and vo~,
and the EDA shall provide to the Owner reasonable documentation
recordable form, such as, but not limited to, a Waiver of Right of
First Refusal, whtch evidences the waiver of the EDA's rights under
t~is ~greement.
4. Payment for Option. In consideration for this ri9ht of
first refusal, the EDA will pay the Owner the sum of $500.00 within
20 days of final execution of this agreement. In the event the EDA
exercises its Right of First Refusal, the Owner agrees the $500,00
payment mede hereunder will be applied to the EDA's purchase of the
property and will be considered an earnest money paid by the EDA to
the Owner for the acquisition of said property.
5. Termination ...Dat~. If not otherwise terminated or
modified, this agreement shall terminate and become null and void
on a eats five years from the date of execution of this agreement,
6. Notice. Any NotiCe required by this Agreements if
mailed, shall be mailed to the following address;
FOR THE OWNERS:
Attn: Donna Hoverman
Homeward Bounds Inc.
4741 Zealand Avenue North
New Hope, MN 56428
Attn: Donna Hoverman
FOR THE EDA:
Attn: Daniel d. D0nahue
New Hope EDA
4401Xylon Avenue North
New Hope~ MN 55428
Attn: &raven A. Sondr~11
Cor~i~k & Sonars11, P.A.
8525 Edinbrook Cro~sing, ate. 20~
Brooklyn Parks MN 55443
7. ~u.ccession. Thte agreement shell be btndlng upon
and inure to the benefit of the ~eirs~ administrators, executors
an~ successors of the respective parties.
Dated this _ day of , 199
HOMEWARD BOUND, INC~, a ~innesota
non-profit corDorat~on
Its
?,08/0@
ECONOMIC DEVELOPMENT AUTHORITY IN AND
FOR THE-CITY OF NEW HOPE, a Minnesota
munici0al corporation
By
Its President
By
Its Executive Director
STATE OF MINNESOTA )
) S~,
COUNTY OF HENNEP[N )
The foregoing was acknow]edged before me this day of
, 199~, by
., the
and , reape~t~vely, of Homeward Bou~
Inc., a M~nneaota non-profit corporation, on .behalf of sa~d
corporation,
Notary Publlo
STATE OF MINNESOTA ) ~
COUNTY OF HENNEP[N )
The foregoing was acknowledged before me this day ot
,'199 , by Edw, d. ErtGEson and Oan~el J.
Donahue, the chairman an~ exeou~ive director, respectively, of the
Economic Development Authority in and for the C~ty of New Hope, a
Minnesota mun~c~p&l corporation, on behalf of said corpora:io~,
Notary Publlc
3
DEC-06-95 N~D 13:49 P, 09/09
DRAFTED BY:
CORRICK & SONDRALL, P.A.
8525 Ed~nbrook Crose~n9, #~03
~rook]yn Park, MN 55443
(012) 425-5671
4
EDA
) REQUEST FOR ACTION
Originating Depmtment Approved for Agenda Agenda Section
City Manager EDA
1-95
Kirk McDonald Item No.
By: Management Assistant By: 6
DISCUSSION REGARDING LEASE BETWEI~N PHOENIX MANUFACTURING CORPORATION
AND THE EDA FOR CITY-OWNED BUILDING AT 7528 42ND AVENUE (IMPROVEMENT
PROJECT NO. 474)
The existing lease between the EDA and Phoenix Manufacturing Corporation for the City-owned
building at 7528 42nd Avenue expires on 12/31/95 and staff requests to discuss with the EDA if you
are interested in extending the lease into 1996. The City has no immediate plans for demolition of the
building/redevelopment of the property and Phoenix Manufacturing has made timely lease payments
during the past year. As you will recall, the EDA entered into the lease with Phoenix for the same
terms as the EDA had with Foremost, Inc. The current lease rental rate (from 4/24/95 through
12/31/95) is $20,020, which is the amount of the 1995 real estate taxes. Under the existing lease,
Phoenix Manufacturing is required to pay all building operating expenses (insurance, maintenance,
utilities) and to correct any substandard building conditions. A copy of the current lease is attached for
your information.
If the EDA is agreeable to extending the lease, staff would request direction from the EDA on the terms
and conditions of the extension. Staff recommends that the EDA consider increasing the rental rate to
market rate conditions, per the enclosed information. Staff recommends that the EDA authorize the City
Manager to negotiate with Phoenix Manufacturing on a lease extension if you are favorable to letting
them remain in the bUilding.
MOTION BY SECOND BY
Review: Administration: Finance:
RFA-O01
DATE: March 22, 1995 ..
TO: Dan Donahue, City Manager
Steve Sondrall, City Attorney
FROM: Kirk McDonald, Management Assistant/Community Development Coordinator
SUBJECT: Industrial Building Rental Rates
In an effort to determine what market rental rates currently are for industrial buildings in the
New Hope area, I contacted Thorpe Bros., Inc. (our agent for the vacant property at
42nd/Nevada Avenues). We specifically discussed the Foremost, Inc. building at 7528 42nd
Avenue North. Per the attached excerpt from the appraisal, the building contains an area of
20,795 square feet and contains 1,600 square feet of office space, or 8% office area. Thorpe
indicated that a Iow rental rate for warehouse space would be $2.50 per square foot on a triple
net lease (they pay all utilities and taxes). They said a more reasonable rate would probably be
$3.00 - $3.25 per square foot. Thorpe indicated that the office space should rent for $5.00 -
$6.00 per square foot.
Using these market estimates on the Foremost building, the monthly and annual payments that
might be derived from a lease are calculated as follows:
Office Space -- 1,600 sq. ft. x 5.00 psf = $ 8,000.00
Warehouse Space = 19,195 sq. ft. x 3.25 psf = 62.383.75
TOTAL PER YEAR = $70,383.75
+ 12 months
TOTAL PER MONTH $ 5,865.31
6
The lar~ is improved with a one story, concrete block and steel frarr~
~ial buildin~ with =site Daved parking and landscapirg.
80' X 87.5' = 7,000
17.5' X 66'" 1,155
40' X 76' =' 3,040
120' X 80' =' 9.600
Toe~l 20,795 Sq,,~e feet
(1,600 sf office slmace, or 8% office)
The buildin~ was ~ to have been originally ]m.ti].t in 1962, with a 1965
addition ar~ the last r~ addition cc~u~xucte~ in 1978.
in some floor cracks and in one series of wall cracks r~-,' the midpoint on
~ block sxtarior wall m~ intarior stssl ~xm-t and be~m framing
~. It~ ~ ~av~~~~ti~.
~o~ ~1~
~gri= ~ ~ ~~ ~~ bl~ ~ ~l ~ ~ ~e offi~
~ ~ f~~=~ a bri~v~ ~~. ~ior~ls a~
~ av~e ~~.
~ ~f ~ a ~ ~ jo~ ~ wi~ ~ ~, rigid ~ation
~ ~lay of ~lt-~ ~t ~ ~v~ ~t is ~~ ~ ~ve ~
~a~ 5 ~ 6y~ ~. ~f 1~~ ~~ ~~ ~f is
~he floors are heavy poured and reinforced concrete. A number of cracks'
were observed b~c ~he floor is generally level and fully usable. Floors
offices are covered wi~h vinyl tS.le.
In,.riot Walls
In~erior walls are primarily ~ concre~ blocks wi~/1 average =o fair
plywood panelin~ in ~he offices. In~erior v~lls are in average
Ceilings are open ~o ~ha ~ fzama in =he shop space and dropped ~o
aoous~c ~ile~ wi~h recessed fluorescen~ ligh~ng in ~he offices. There is
T~e buildin~ has me~=~ f~--- wirdows wi~h swing~ opening seCcions at
office, single pan~ glazed. There is a glass and me~al front e~xy door, me~al
service doors and wood ~ overhead doors for loading at ~ bed
height. Doors and winda~ are in average condition.
A 1,200 amp electric main serves ~ha buAlding. T~ere ara eigh= 2O0 amp
circuits and four 100 amp circuits. Perimeter plug-ins ar~ found in ~he shop
space and ~he office appears ~0 have av~ c~m ~t~ ~ibu~ion. Hookups ~o
Plumbina
The office is ~c~1¥ served by t~o, tram fix~t~e washroc~s wi~h ceramic
~ile floor and ~ and ~he shop has a separate five fix~Are washroa~
includin~ a 360° Bradley hand washer. There is a 30 gallon natmral gas fired
water hea~_r and cc~0~r piping was observed. Plumbing is average.
gas fired ~lower unif.~ in the shop spaoe. A Carrier na~x=-al gas fired fuzna~
and central air conclitionir~ uni~ servee the offices. Su~~ office air
conditioning is provided by one wall ~? ~ti°net. 9~e office also has a
smokm eater (~' lmrifier).
A three ton sir~le z-ail, rail ~ist passes in an east west direction
from the ~ l__,3~ng clock across the width of the huildir~:. No other
manuf~ir~ and the modest amcalr~ of office ttsage ~h~t t~ually a~es
that type of use. The rear sh~ space is divided into three or four general
use areas scare of which arm partitioned. There are two se~s of smaller sho~
offices.
and is in slightly above average overall cca~ttic~.
On-Site
Toe b,~nq ~ about rmlf of the site. Scddinq occupies about 10% of
the site lyinq -*-~c and scut~ of the b,~nq with the balance of the site
occupied by bill,nc,,- paved parkinq lot, drive isle, and lcadirg ar-~-. The
bittmtinca~ pav~ is aging, somewhat breakir~ u~ and oonsidered to be in only
fair overall ~ticn.
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I [ Plat Map,
88/15/95 12:38 'LINDQUIST & UENNUM + 8???2959 N0.785 P004 '
LEASE
day of f , 1995,
by, and between the Economic Development Auth and for the
City of New Hope (hereinafter "Lessor"), and Phoenix Manufacturing
Corporation, a Minnesota corporation (hereinafter "Lessee"). The
Lessor and the Lessee, used collectively herein, may be hereinafter
called the "Parties"
IT 15 HEREBY AGREED, in consideration of the mutual covenants
and pcomises herein:
t. Leased Premises.
The Lessor, in consideration of the herein rent~', covenants,
agreements, and sti~ulations to be pa~d, kept, and performed
by the Lessee does hereby lease and rent to the Lessee, and
The Lessee hereby ~grees to lease, and to take, u~on the
terms, ~nd the conditions, hereinafter set forth, certain rea]
property, consisting of a Building, hereinafter called the
"Building",.and Land, hereinafter ca~]ed the "Land", known as
7528 42nd Avenue North in the City of New Hope, in the County
of Hennepin, in the State of Minnesota, and legally described
as follows:
Lot 5, Auditor's Subdivision No. 324, the adjacent
vacated alley, subject to street and utility easements,
Hennepln County, Minnesota.
hereinafter called the "Leased Premises"
2. Base Rent,
The Lessee agrees to pay the Lessor, beginning on the
commencement date of the Term, as hereinafter defined ~n
Paragraph ~, entitled "Term", of this Lease, a Base Rent,
hereinafter called "Base Rent", of Twenty Thousand and Twenty
Dollars ($20,020.00).
Said Base Rent sha]~ be paid as follows: (i) Seven Thousand
Five Hundred Dollars ($7,500.00) has been paid p?ior to the
d~te th~s Lease is executed; (ii) Two Thousand Five Hundred
087t5xg5 12:30 LINDQUIST & UENNUM + 87772059 N0.705 P00~
Ten Dollars ($2,510.00) Will be paid upon execution hereof,
and (iii) the remaining amount will be paid in four equal
monthly payments of Two Thousand Five Hundred Dollars
($2,500.00) each (the "Monthly Payments") on the first d~y of
September, October, November and December, 1995.
3. Additional Rent.
Wherever ~t ~s provided ~n th~s Lease that the Lessee ~s
required to make payment to the Lessor, such payment shall be
deemed to be Additional Rent. All remedies applicable to the
nonpayment of rent shall be applicable to nonpayment of
additional rent.
Notwithstanding the foregoing, such Add~tional Rent shall not
be deemed to be Base Rent.
4. Term.
The Term of this Lease shall commence April 2~, 1995~ and
terminate at midnight, December 31, 199~.
It is understood and agreed Lessee shall have no option to
renew this lease.
5. Current Condition.
The Lessee acknowledges that the Lessee Has had ample
opportunity to 4nspect the condition of the Leased Premises.
The Lessee ~mkes the same in ~s present condition, "as is".
Lessee agrees that Lessor shall not be obligated ~o make any
reDaCts to ~he building at mny time during the lease term.
6, [~ture Upkeeo.
The Lessor shall have no responsibility for any maintenance,
repairs, or replacements to the Leased Premises, except only
as specified in Paragraph 12, entitled "Damage or Destruction
of Premises", and in Paragraph 21, entitled "Condemnation".
7. Maintenance and Repairs by Lessee.
Other than as provided ~n Paragraph 12, entitled "Damage or
Destruction of Premises", and in Paragraph 21, entitle~
"Condemnation" the Lessee agrees, at ~ts own expense, to keep
and maintain t~e Leased.Prem~ses,
Th~s shall include,.without l~mit~ng the generality of the
foregoing: foundations, structural components, walls, roofs,
HVAC systems, plumbing systems, electrical systems, floors,
08/15/95 12:30 'LINDQUIST & UENNUM a 8?772959 NO.?05 P006
j ~
exterior and interior doors, windows, and glass, all other
components of the building, driveways, walkways, and parking
areas. It is understodd Lessee is under no obligation to ~ake
any repairs but Lessee agrees it is not entitled to any rent
abatement for rep&irs made pursuant to this paragraph.
8. Utilities.
The Lessee sh~]l pay, and shall hold the Lessor free and
harmless from, all bills or assessments for lights, heat,
water,, gas, sewer rentals or charges, and any other expenses
arising out of, or incidental to, the occupancy of said Leased
Premises by Phoenix Manufacturing Corporation through the term
of this lease.
9. Taxes and Assessments.
The Lessor acknowledges and agrees it shall pay ail real
estate taxes and sDecial assessments due against the ~eased
premises for the term of the lease.
10. Lessee's Improvements.
(a) Lessee's Options.
The Lessee, during the fuji Term of this Lease, sha~l have the
right, at any time, and from time to time, at its own, and
sole, exDense ~nd liability to p~ace, or to insta~], within
the Building such leasehold improvements as the Lessee
desire.
(b) Ownership Upon Termination.
All such leasehold improvements made by the Lessee shall be,
and shal~ remain, the pro~erty of the Lessee. Such leasehold
improvements may be removed by the Lessee, at the Lessee's own
8xpense.
(c) Required Approvals.
The Lessee shall first obtain the prior written consent of the
Lessor for improvements involving structural changes or
external appearance changes, including signs, or if the
estimated cost of improvements shall exceed Ten Thousand
Dollars ($10,000,00).
3
~8/15/95 12:31 · LINDQUIST g UENNUM 9 8?772959 N0.785 P887
,
?
(d) Standards.
No such installation or construction shall violate any lawful
rule or regulation, plat, or zoning regulation, or other law,
ordinance, or regulation appl'icable thereto. All shall be done
and performed in a good and workmanlike manner,
(e) Costs.
Al1 costs of any such improvements shall be paid by the
Lessee. The Lessee shall allow no liens for labor or materials
to attach to the Leased Premises by'virtue thereof.
Insurance.
The Lessee agrees to pay all of the premiums required during
the Term hereof, to provide, and to keep in force, the
following insurance coverage. -.
(a) Nature of Coverage.
Commercial general liability insurance, providing coverage on
an "occurrence" rather than a "claims made" basis, which
policy shall include coverage for bodily injury, property
damage, persona1 injury, contractual liability and independent
contractors, with combined policy limits of not less than Two'
Million Dollars ($2,000,000), for injury or death in any one
accident or occurrence, including property damage, insuring
the Lessor and the Lessee.
(b) Cance~atlon and Modification.
All such policies shall provide against cancellation or
material modification, except after thirty (30) days written
notice to the Lessee, and the Lessor.
(c) Commencement and Payment.
All policies provided hereunder shall be obtained by the
Lessee prior to the commencement of the Term hereof. Payments
of premiums shall be made by the Lessee.
(d) Increased Risk.
The Lessee shall not carry any stock of goods, nor do anything
in, or about, the Leased Premises which will impair, or
invalidate, the obligation of any policy of insurance on, ar
in reference to, the Leased Premises.
88/15/95 12:31 -LINDQUIST & UENNUM a 8?972959 NO.?~]5 P~08
12. Damage or Destruction of PremiseR.
If the Leased Premises are totally or partially destroyed, by
storm, fire, lightning, earthquake, or other casualty, this
Lease shall be terminated and Lessee shall have no further
rights hereunder. Lessor shall have no obligation to restore
the premises. There shall be no rent abatement for any
prepaid rent paid by Lessee.
13. Abatement.
The Lessee's obligations to pay rent, including Base Rent and
Additional Rent, and to perform all of the other covenants and
agreements which the Lessee is bound to perform under the
terms of this Lease shat1 not terminate, abate, or be
diminished during the period that the Leased Premises, or any
part thereof, are untenantable, regardless of ~he cause of
such untenentability, it being the intent of the Parties that
this is a rant insured against by Lessee.
If untenantability continues beyond 30 days, Base Rent and
Additional Rent shall abate proportionately to the area of the
Leased Premises that are untenantab]e.
14. ~ompliance with. Laws.
The Lessee, in the use and the occupancy of the Leased
Premises, and in the conduct of the Lessee's business and
activities, shall, at its own cost and expense, secure and
maintain all necessary licenses and permits.reQuired for the
conduct of its business and activities.
The Lessee shall, at all times, comply with all laws and
ordinances, all lawful rules and regulations issued by any
legally constituted authority, and with the applicable orders,
regulations, and requirements of any board of fire
underwriters, making any modifications to the Leased Premises
required thereby.
15. Use.
Because the Lessor and the Lessee have negotiated a specific
rate of Base Rent,'in reliance upon a particular use of the
Leased ~remises, the Leased Premises may only be used for
sheet metal fabrication or purposes incidental thereto and for
no other Purpose.
5
08715/95 12:31 LINDQUIST & UENNUM + 8???2959 NQ.?~5 Pv]09
18. Waste.
The Lessee agrees not to do, nor to suffer, any waste to, or
upon, the Leased Premises.
17. Liens,
(a) Liens.
The Lessee agrees not to cause, suffer, nor permit any liens
to attach to, or to exist against, the Leased Premises, by
reason of any act or omission of the Lessee, or persons
claiming through the Lessee, by reason of the Lessee's failure
to perform any act required of the Lessee hereunder.
(b) Illegal Actions,
The Lessee shall not permit the Leased Premises t~ be used for
any illegal purpose.
(c) Lessee's Release from.Ob!.jgation.
However, the Lessee shall not be required to pay, or to
discharge, any lien against the Leased Premises, so long as
(1) The Lessee has given the Lessor notice of the
Lessee's intent to contest such lien, and
(2) The Lessee is in good faith in contesting the
validity or amount thereof, and
(3) The Lessee has given to the Lessor such security as
the Lessor has reasonably requested to assure
payment of such lien and to prevent the sa]e,
foreclosure, or forfeiture of the Leased Premises
by reason of nonpayment.
(d) Satisfaction and Release.
On final determination of the lien, or claim of lien, the
Lessee will immediate3y pay any judgment rendered and
costs and charges. The Lessee shall cause the ~en to be
released or satisfied.
(e) Easements and Prescriptive Rights.
The Lessee will not use, or permit the use of, the Leased
Premises in any manner which wou~d result, or would, with the
passage of time, result, ~n the creation of any easement or
Prescriptive right.
88715/~5 12:31 .LIND~UiST & ~ENNUM ~ 89772959 N0.705 P810
18. Lessor's Performance of Lessee's Duties,
(a) tessee's Performance Oefau]t.
If the Lessee should default in the performance of "any
covenant on the Lessee's part to be performed by virtue of Any
provision of this Lease, the Lessor may, after ten (10)days'
notice (or, in the case of emergencies, reasonable attempt at
prior notice), perform the same for the account of the
Lessee.
(b) Lessor's Authority.
The Lessee hereby authorizes the Lessor to come upon the
Leased Premises for such purposes and, while on the Leased
Premises, to do all things reasonably necessary to accomplish
the correction of such default.
(¢) Lessor's Expenditures.
If the Lessor, at any time, is compelled to pay, or elects to
pay, any sum of money, by reason of the failure of the Lessee,
after ten (10) days' notice, to 6amply with any provision of
this Lease, or if the Lessor is compelled to incur any
expense, including reasonable attorney's fees, in instituting,
prosecuting, or defending any action or proceeding instituted
by reason of any default of the Lessee hereunder, the sum or
sums so paid by the Lessor with all interest costs and
damages, shall be deemed to be Additional Rent hereunder.
(d) Lessee's Reimbursement.
The total of these, together with interest thereon, at the
rate of eight percent (8%) per annum, shall be due from the
Lessee to the Lessor on the first day of the month following
the incurring of such respective expense, except as otherwise
herein provided.
19. Condemnation.
(a) Termination of Lease.
In the event all of the Leased Premises, or such portion
thereof as will make the Leased Premises unusable for the
purposes of the Lessee, be condemned by any legally
constituted authority, for any public use or purpose, then in
either of said events, the Term hereby granted shall cease, at
the option of either the Lessor or the Lessee, upon thirty
(30) days' written notice, from the time when possession
7
08/15/95 12:~1 ~LINDQUIST & UENNUM a 87772959 NO.?~5 P~ll
thereof is taken by said public authorities. Rent shall be
due and payable only for the period of the Term prior to said
condemnation.
(b) Re~pvery.
Such termination, however, shall be without prejudice to the
rights of either the Lessor or the Lessee, or both, to recover
compensation and damage caused by the condemnation from the
condemnor, except'
(1) Leasehold Value,
The Lessee shall have no rights for the value of its
leasehold.
(2) Other Parties. ..
Neither the Lessee nor the Lessor shall have any rights
in any separate award made to the other Party by the
condemnor.
(c) Partial Condemnation,
In the event less than all of the Leased Premises are taken or
condemned for a public or quasi-public use, and the portion of
the Leased Premises not taken may be reasonably suitable for
the purposes of the Lessee by repair or restoration, this
Lease will not terminate.
(d) Lessor's Repair and Restoration.
The Lessor shall, in such event, promptly commence, and
diligently complete, the repair and restoration of the Leased
Premises,.so that, upon completion, the Leased Premises will
constitute a complete architectural unit, with an appearance,
character, and commercial value as nearly as possible equal to
the value of the Leased Premises immediately prior to the
taking. However, the Lessor shall have no obligation to make
such repair and restoration if the estimated cost of such
exceeds the condemnation proceeds received by the Lessor.
(el Rent Abatement.
There shall be an abatement of annual 8ese Rent and Additional
Rent after such taking, which shall be equal to the percentage
of total area of Leased Premises after the taking, as relates
to the total area of the Leased Premises immediately prior to
said taking thereunder, to the termination of this lease.
~8/15/95 12:31 LINDQUIST & UENNUM a 87772959 N0.705 P012
20. Lessor Indemnified,
The Lessee agrees to indemnify, and save harmless, the Lessor
against, and from any and all, claims including all costs 'and
reasonable and ncessary attorney's fees, Lessor incurs
defending claims brought by, and on behalf of, any persons,
firms, or corporations, arising from the conduct or management
of, from any work or thing whatsoever done by, or on behalf
of, the Lessee in or about, or from the Lessee's activities
upon, or occupancy of, the Leased Premises during the Term of
this Lease. This shall include claims or damages arising from
any breach or default on the part of the Lessee in the
performance of any covenant or agreement of this Lease, or
from any act or negligence of the Lessee, or any of its
agents, contractors, servants, employees, licensees, or
invitees, or arising from any accident, injury, or damage
whatsoever caused to any person, firm, or corporation,
occurring during the Term of this Lease.
This indemnification and hold harmless clause shall not apply
to any claims for damages caused by the Lessor's own
negligence or by any agent, employee or any other person
actinQ either directly or indirectly on the Lessor's behalf.
21. Insmection of Premises.
The Lessee agrees to permit the Lessor and the Lessor's
agents, to come upon, and to inspect, the Leased Premises, at
all reasonable times,
The Lessee further agrees to permit the Lessor and the
Lessor's agents, to come u~on the Leased Premises if necessary
to perform any act which the Lessee has failed to perform, as
provided elsewhere in this Lease.
22. Default.
{a) Definition.
If one or more of the following events, hereinbefore, and
hereinafter, called "Default", shall happen, and be continuing
for ten days after written notice has been given to Lessee, a
condition of Default, herein referred to as "Default", shall
exist, namely:
(1) Untimely Payment.
Default shall be made.in the punctual payment of any rent
herein agreed to be paid, and such Default shall continue
g
88}15×95 1~:31 'LINDQUIST & ~JENNUM ~ 8???2959 N0.785 P013
?
~or ~ period of ten (10) days after written notice is
given by the Lessor to the Lessee of such Default;
(2) Assignment.. "
The Lessee makes an assignment for the benefit of
creditors;
(3) Bankruptcy or Credit Relief.
The Lessee files a petition in bankruptcy, prays for
relief under the Federal Bankruptcy Law, or makes an
assignment for the benefit of creditors;
(4) Attachment or Execution.
An attachment or execution is levied upon ..~he Lessee's
property in, or interest under, this Lease, which is not
satisfied or released, nor the enforcement thereof stayed
or superseded by an appropriate proceeding within thirty
(30) days thereafter;
(5) Involuntary Bankruptcy or Reorganization.
An involuntary petition in bankruptcy, or for
reorganization or arrangement under the Federal
Bankruptcy Law is filed against the Lessee, and such
involuntary petition is not withdrawn, dismissed, stayed,
or discharged within sixty (BO) days from the filing
hereof;
(5) Receiver or Trustee.
A Receiver or a Trustee is appointed for the property of
the Lessee, or of the Lessee's business or assets, and
the order or decree appointing such Receiver or Trustee
shall have remained in force undischarged or unstayed for
thirty (30) days after the entry of such order or decree;
(7) Abandoned Premises or Failure to. Op~.
The Lessee shall abandon the Leased Premises;
(8) Continued Failure.
The Lessee shall fail to perform or observe any other
covenant, agreement, or condition to be performed or kept
by the Lessee under the terms and provisions of this
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88/15/95 12:31 LINDQUIST & UENNUM + 8???2959 N0.785 PSl~
Lease, and such failure shall continue for ten (10) days
after written notice thereof has been given to the Lessee
by the Lessor unless the Lessee shall have commenced
corrective action within such ten (10) days, and
thereafter diligently completes the same;
(9) Death of Lessee,
The death of the Lessee may, at the sole option of the
Lessor, be the basis for termination of this Lease
(b) Optional Actions.
In the event such condition of Default shall exist, then, and
in any such event, the Lessor shall have the right, at the
option of the Lessor, then, or at any time thereafter, while
such Default or Defaults shall continue, to eleot either of
the following actions:
(1) Cure Default,
To cure such Default or Defaults at the Lessor's own
expense, without prejudice to any other remedies which
the Lessor might otherwise have, any payment made, or
expenses incurred by the Lessor in curing such default,
with interest thereon at eight percent (8~) Der &nnum to
be, and to become, Additional Rent, to be paid by the
Lessee, with the next installation of rent falling due
thereafter, or
(2) Re-entrance.
To re-enter the Leased Premises, without notice,
dispossess the Lessee, and anyone claiming under the
Lessee, by summary proceedings or otherwise, remove their
affects, take complete possession of the Leased Premises,
and elect to take either of the following actions:
(A) Terminate Lease.
To declare this Lease forfeited and the Term ended,
or
(B) Continue Lease with Reservations.
To elect to continue this Lease in full force and
effect, but with the right, at any time thereafter,
to declare this Lease forfeited and the Term ended.
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08/15/95 12:32 ' LINDQUIST & VENNUM ~ 8???2959 N0.785 P015
?
In such re-entry, the Lessor may remove all persons from
the Leased Premises. The Lessee hereby covenants, in such
event, for the Lessee, and all others occupying the
Leased Premises under the Lessee, to peacefully yiel~ uD
and surrender the Leased Premises to the Lessor.
(c) Recovery Upon Forfeit.
Should the Lessor declare this Lease forfeited, and the Term
ended, the Lessor shall be entitled to recover from the Lessee
the following amounts'
(1) Rent.
The rent and all other sums due and owing by the Lessee
to the date of such termination;
(2) Costs.
The costs of curing all of the Lessee's Defaults existing
at, or prior to, the date of termination; and
(3) Value.
The worth as of the termination of the Lease, in an
amount equal to the then value of the excess, if any, of
the aggregate of rent reserved in this Lease for the
balance of the Term, over the then agreed upon value of
the Leased Premises for the balance of the Term.
(d) Recovery Upon Conditional Continuation.
Should the Lessor, fol]owing Default as aforesaid, elect to
continue this Lease in full force, the Lessor shall use its
best efforts to'rent the Leased Premises on the best terms
avail, able for the remainder of the Term hereof, or for such
longer or shorter period as the Lessor shall deem advisable.
The Lessee shall remain liable for payment of all rentals and
other charges and costs imposed on the Lessee herein, in the
amounts, at the time, and upon the conditions as herein
provided. However, the Lessor shall credit against such
liability of the Lessee all amounts received by the Lessor
from such reletting, after first reimbursing the Lessor for
al] costs incurred in curing the Lessee's Defaults,
re-entering, preparing, and refinishing the premises for
reletting, and in re~ettin9 the Leased Premises.
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T8/15/95 12:S2 .LINDQUIST & UENNUM ~ 87772959 N0.705 P016
(e) Written Notice Required.
No re-entry by the Lessor, nor any action brought by the
Lessor to remove the Lessee from the Leased Premises, shall
operate to terminate this Lease, unless the Lessor shall give
written notice of termination to the Lessee, in which event
the Lessee's liability shall be as above provided. No right or
remedy granted to the Lessor herein is intended to be
exclusive of any other right or remedy hereunder, or now or
hereafter, existing in law or in equity or by statute.
(f) Lessee's Waiver.
In the event of termination of this Lease, the Lessee waives
Any and all rights to redeem the Leased Premises, either 9ivan
by any statute now in effect, or hereinafter enacted.
(g) Holding Over
Any holding over by the Lessee after the termination of this
Lease shall create a tenancy from month to month, on the same
terms and conditions, and at the same rent as herein provided
applicable during the Term hereof. The same rent is defined
as $20,020.00 divided by 12 months or $1,868.33 per month.
23. Interest.
All payments required to be paid by the Lessee under the
provisions of this Lease shall bear interest at a rate of
either of the following rates in the following circumstances:
(a) Corporate.
Twelve percent (12~) per annum, if the Lessee is a
corporat ion: or
(D) Noncorporate.
The highest rate allowed by Minnesota Statutes Section
334.011, if the Lessee is other than a corporation.
Interest shall begin to accrue five (5) days after the due
date of each payment, and shall continue until the date
actually paid by the Lessee
Late Fee.
The Lessee hereby agrees that, in addition to interest and
other amounts due the Lessor hereunder, the Lessee will pay to
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8S/~5/95 i2:32 .L!ND~UIST & UENNUM + 877?2959 N0.705 P017
?
the Lessor a late fee, herein referred to as a "late fee"
equal to five percent (~) of any payment which has not been
paid within five (5) days after its due date, without notice
or demand.
25. Condition of Premises Upon Termination.
Uoon termination of this Lease, for any reason, the Lessee
covenants and agrees to remove all of the Lessee's personal
property, including, fixtures and equipment installed by the
Lessee upon the Leased Premises. The Lessee shall have no
obligation to repair any damage caused by the removal hereof
if done at or near the expiration of the full term of this
Lease, If this Lease termination prior to the expiration of
the full term of this Lease, Lessee agrees that it shall leave
the Leased Premises in as good and clean condition as at the
commencement of this Lease, excepting normal and reasonable
wear and tear and usage.
26. Successors and Assi~oA,
The obligations and responsibilities shall be binding upon,
and the rights and benefits shall inure to, the successors and
assigns of the Parties hereto. However, the liabilities of
any successor to the interest of the Lessor hereunder shall be
limited to the performance of those obligations which arise'
and accrue during the period of ownership of the Leased
premises by any such successor.
27. Notice.
(a) Delivery.
Any notices or inquiries regarding this Lease shall be
delivered:
To the Lessor:
Oaniel J. Oonahue
Executive Director
EPA in and for the City of New Hope
&401 Xylon Avenue
New Hope, MN 55428
To the Lessee:
Thomas Giebe], President
Phoenix Manufacturing Corporation
7528 42nd Avenue. North
New Hope~ MN 55428
14
08/1~/95 12:3~ LINDQUIST & UENNUM a 8?992959 N0.705 P018
or to such other addresses as the Parties may designate, in
writing.
(b) ~elivery.
Notice may be given by registered or certified mail, return
receipt requested. In those circumstances, the date of service
shall be the date on which notice is deposited in a United
States Post Office, properly stamped and ~ddressed. In all
other methods of mailing, notice shall be deemed to be served
when received.
28. Oral Aareements.
It is expressly agreed between the Lessor and the Lessee that
there is no verbal understanding or agreement which in any way
changes the terms, covenants, and conditions herein set forth.
It is also expressly agreed between the Lessor and the Lessee
that no modification of this Lease, and no waiver of any of
its terms and conditions, shall be effective unless made in
writing and duly executed by the authorized officers of the
necessary Party or Parties,
29. Waiver.
The failure of the Lessor or of the Lessee to insist, in one
or more instances, upon the strict performance of the Lessee
or of the Lessor of any of the provisions of this Lease shall
not be construed as a waiver of any future breach of such
provisions.
Receipt by the Lessor of rent, with the knowledge of the
breach of any provisions hereof, shall not be deemed a waiver
of such breach.
30. Warranties of Lessee.
The Lessee warrants to, and for the benefit of, any mortgagee
of the Leased Premises that, as of the date of execution of
this Lease, it neither has, nor claims, any defense to this
Lease, nor any offset against the rentals payable or other
obligations required of the Lessee hereunder.
The Lessee further warrants that it has not paid any rental in
advance for a period of more than one (1) month, and covenants
that it will not, without such mortgagee's written consent, at
any time during the Term hereof, prepay any rental for a
period longer than one (t) month.
15
~8~5/95 12:32 'LIND~UIST & UENNUM a 8???2959 NO.?~5 POI~
~ ,
31. CardinR.
The Lessor may card the Leased Premises "For Rent" or "For
Sale" ninety (90) days before the termination of this Lease.
The Lessor may enter the Leased Premises at reasonable hours
to exhibit same to prospective purchasers, tenants, and
mortgagees, to make repairs required of the Lessor under the
terms hereof, or to make repairs to the Lessor's adjoining
property.
32, Landlord and Tenant.
This contract shall create the relationship of landlord and
tenant between the Lessor and the Lessee. No estate shall Pass
out of the Lessor.
33, Time of Essence.
Time is of the essence of this Agreement,
34. Lessor's Consent.
[n all matters referred to in this Lease, where the Lessor's
consent or approval is required, the Lessor agrees that the
Lessor w~ll not unreasonably withhold ~ts consent or approval.
35. Leaa] Expense.
The Lessee covenants and agrees to pay~ and to indemnify the
Lessor against, all reasonable legal costs and charges,
including attorney's fee, lawfully and reasonably incurred
obtaining possession of the Leased Premises after Oefau]t by
the Lessee, or upon expiration or earlier ~ermination of
TeFm of th~s Lease, or ~n enforcing any covenant or agreement
of the Lessee here~n contained.
The Lessor covenants and agrees to pay a~] reasonable
costs and charges, including attorney's fees, 3awfu]ly and
reasonably ~ncurred in enforcing any covenant or agreement of
the Lessor herein contained,
36. T~tle of Lessor.
The Lessor expressly covenants and agrees that, as of the
commencement date of the Term of this Lease, the Lessor
be the owner of the fee sSm~le title to the Lease Premises.
The Lessor further covenants that the Lessee, on paying the
rent~ and upon observing and performing all other terms and
16
~8/15Y95 12:3~ ~LIND~UIST & UENNUM ~ 87772959 NO.?~5
'
conditions contained in this Lease, shall have quiet and
peaceful possession thereof,
37. Waiver of Certain Claims.
The Lessor and the Lessee hereby waive any claims which may
arise in the Lessor's or the Lessee's favor against the other
Party hereto during the Term of this Lease, or any renewal or
extension thereof, for any loss or damage to any of the
Lessor's or' the Lessee's property located within, upon, or
constituting a part of the Leased Premises hereunder, which
loss or damage is covered by a valid and collectible fire and
extended coverage insurance policy or policies, to the extent
that such loss or damage is recoverable under said insurance
or policies.
The Lessor and the Lessee further agree to notify the Lessor's
and the Lessee's own insurance company or compaQies, which
have issued, or will issue, to the Lessor and to'the Lessee,
fire and extended insurance policies for the Leased Premises,
or anything located therein, and to have said policies
properly endorsed, if necessary, to prevent the invalidation
of said insurance coverage by reason of this mutual waiver.
The Lessee shall keep in force, at all times, adequate
coverage of its fixtures, personal property, and other
"contents"' located upon the Leased Premises.
38. Governing Law.
This Lease shall be performed, construed,.and enforced in
accordance with the laws of the State of Minnesota.
39. Captions.
The captions used in this Lease are for convenience only, and
shall not have any bearing or meaning with respect to the
content or context of this Instrument.
40. Ho.IdahO_Over.
If the Lessee remains in possession of the Leased Premises
after expiration of the Term hereof, with the Lessor's
acquiescence, and- without any express agreement of the
Parties, the Lessee shall be a tenant at will at the then
rent.
There shall be no renewal by operation, or by law, of this
Lease.
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08/1~/95 12:32 LINDQUIST & VENNUM -~ ooo~q=,~
~, ~ ,=-wi NO.?05 P021
Cumulative Rights.
All rights, powers, and privileges conferred hereunder upon
the Parties shall be cumulative but not restricted to t'hose
given by law.
Memorandum 0f Lease
The Lessor hereby agrees, at the Lessor's sole cost, to
prepare and record a Memorandum of Lease at the location where
the deed of title to the Leased Premises is of record. The
recording of the Memorandum of Lease shall be done on, or
before, the date this Lease commences.
Number and Gender,
Wherever appropriate to the sense of this Lease, the singular
number shall include the Plural, and vice versa.,.
Wherever appropriate to the sense of this Lease, the masculine
pronoun shall include the feminine and the neuter, the
feminine sha~t include the masculine and the neuter, and the
neuter shall include the masculine and the feminine.
Severability.
If any part, or portion, of this Lease shall be adjudicated by
a court of competent jurisdiction to be unlawful, this Lease
shall remain in effect, and in force, as if that part, or
portion, were no longer a part of this Lease.
Hazardous Substances, Lessee shall not (either with or
without negligence) cause or permit the escape or release of
any biologically .or chemically active or other hazardous
substances or materials on the Leased Premises.. Lessee shall
not allow the storage or use of such substances or materials
in any manner not sanctioned by ]aw or by the highest
standards prevailing in the industry'for the storage and use
of such substances or materials, nor allow to be brought into
the Leased Premises any such materials or substances except to
use in the ordinary course of Lessee's business. Without
]imitation, hazardous substances and materia]s shall included
those described in the Comprehensive Environmental Response
Compensation and Liability Act of 1980, as amended, 42 U.S.C.
Section 9§01 et. seq., and applicable state or local laws and
the regulations adopted under these acts. If any governmental
agency shall ever require testing to ascertain whether or not
there has been any re~ease or hazardous materi~ls related
solely to Lessee's occupancy of and activities on the Le~seQ
18
12:32 .~LINDQUIST & UENNUM ~ 87772959 N0.705 P022
Premises, then the reasonable costs thereof shall be
reimbursed by Lessee to Lessor upon demand as additional
charges if such requirement applies to the Leased Premises.
In all events, Lessee shall indemnify Lessor in the manner
provided in paragraph 20 from any release of hazardous
materials on the Leased Premises caused or permitted by Lessee
and occurring while Lessee is in possession, or elsewhere if
caused by Lessee or persons acting under Lessee. The within
covenants shall survive the expiration or earlier termination
of the Lease term. This provision shall not apply to any
release of hazardous substances specifically related to the
ground and soil water contamination .already documented at the
adjacent property formerly known as Electronic Industries.
45. Lessee's Reclamation Right. Lessee end Lessor agree that upon
the satisfaction of the terms of this lease and at the time
the facility at 7528 North 42nd Avenue is vacated by the
Lessee, the Lessee will be granted reclamation Eights to all
fixtures, leasehold improvements and internal structures in
the facility, Since the EDA intends to raze the facility upon
the expiration of this lease, the EPA also 9rants unto the
Lessee the right to reclaim structural materials subject to
the following conditions: 1) The Lessee must submit and EPA
must accept a written proposal specifying how the site will be
modified. The ptan will include a schedule for completion and
the name(s) of contractors responsible for performing the
work, and 2) how the site will be rendered upon completion of
the reclamation process. Lessee agrees its reclamation right
will not increase Lessor's cost to raze the building and
Lessee further agrees to pay Lessor any additional costs to
raze the building occasioned by Lessee's exercise of this
reclamation right as mutually determined between the parties.
47. Lessor's Represent.ations Megardin9 Hazardous Substances.
Lessor represents to Lessee that Lessor is not aware of any
hazardous substances on the Leased Premises.
Lessor represents and warrants:
(a) That there are no past or present investigations,
administrative proceedings, notices of violation or other
civil or criminal action threatened or pending alleging
non-compliance with or violation of any statutes,
regulations or ordinances relating to any environmental
permits, release or discharge of any hazardous substances
or pollut&nts or contaminants on or related to the Leased
Premises.
19
88~15×95 12:33 . 'LINDQUIST & UENNUM + 87772959 N0.785 P023
(b) That Lessor has not violated any statute, regulation or
ordinance relating to any environmental permit or the
release of any hazardous substance, pollutant . or
contaminant on or related to the Leased Premises. "
(¢)' That the Leased Premises are not listed in the National
Priorities List maintained by the United States
Environmental Protection Agency, or any other comparable
list maintained by any other federal, state or local
agency.
IN WITNESS WHEREOF, the Parties hereto have caused this
Instrument to be duly executed as of the day and year first above
written.
LESSEE: ~HOEN!X MANUFACTURING LESSOR: ECONOMIC.. DEVELOPMENT
CORPORATION AUTHORITY ~N AND FOR CITY OF
by by ~ ·
~ /L/~~~ -I /~dw~r~/~-J. Erickson,
' Its Pr'"esident
· _, ~/Daniel ~- Oon~hue, ~----
Its Executive Director
2O