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Home My WebLink About2007-08-15 AGENDA. �. COTTAGE GROVE CITY COUNCIL AUGUST 15, 2007 Agenda Updated: August 2, 2007 SPECIAL MEETING - 6:30 P.M. CALL TO ORDER — Mayor RO�L CALL — City C�erk UNFINISHED AND NEW BUSINESS Consider ratifying the Economic Development Authority recommendation regarding entering into a purchase agreement with WAG Farms, entering into a development agreement with WER DIS, LLC, and authorizing an allocation of the ED Trust Fund toward project expenditures. Staff Recommendation: Ratify the Economic Development Authority actions from their August 14, 2007 meeting. 2. BUDGET WORKSHOP Response to previously raised Council comments/requests Community Deveiopment (Tab) 1. Planning/Inspections 2. Historic Preservation Golf Course Enterprise Fund (Tab) Recreation (Tab) 1. Recreation Program 2. Parks Maintenance 3. Forestry 4. Municipal Pool 5. Landscapelnterns Recycling Speciai Revenue Fund (Tab) Ice Arena Special Revenue Fund (Tab) Pubiic Works (Tab) 1. Engineering 2. Street Maintenance 3. Street Seal coating 4. Signs and Striping 5. Snow and Ice Controi 6. Public Works Administration Water Operating Enterprise Fund (Tab) Sewer Operating Enterprise Fund (Tab) Street Lights Enterprise Fund (Tab) Storm Water Utility (Tab) Fleet Maintenance Internal Service Fund (Tab) Equipment Replacement Speciai Revenue Fund (Tab) Property Taxes/Debt (Tab) Performance Measurements (Tab) ADJOURNMENT r� Background On Apri1 10 the EDA was presenYed with the 2007-2012 Strategic Plan developed at the March 31, 2007 retreat of the Board. 'The City Council ratified receipt of this plan on April 18, 2007. Within this plan the EDA had adopted as a priority continued expansion of the industrial park to include a corporate cain�us opportunity. WiY11 that in mind the EDA also initiated tax increment district 1-14 on April 10, 2007 which was approved by the City Council on April 18, 2007 after a public hearing on that same date (hearing called on February 21, 2007 a copy of ihe hearing notice is enclosed). The TIF District creation contemplated t11at site work would be conducted to facilitate creation oY a development parcel on a portion of the districC with the remainder reserved for storm water and park uses. It was also contemplated that the deveiopment site would provide for a single or potenfially two development parcels to include a corporate headquarters site for a large single user due to the site ameniries that the City contempiated creating. A copy of a proposed development site that was created in February, 2007 in preparation for thcse decisions is enclosed herein. At this time we are proposing a development which is strongly aiigned with development goals stated by the City Council and its EDA. We have enclosed a deveiopment ab eement with Werner Electric Supply Mii�nesota (Werner). It is the intent of this agreement that WErner would relocate their corporaTe ofiices to an approximate 20 acre sife within TIF 1-14. tl draft site pian is enclosed. Werner Electric Supply Minnesota Werner (fka Narthland Eiectric) is an elec�sic and automation equipment wholesaler. Originally founded in 1927 Northland Electric becaine Werner in May 2001 when it was purchased by a combination of Werner Electric Supply of Wisconsnl and Van Meter Tndustrial of Iowa. Currently it has branch locations in Minneapolis, St. Cloud, Owafonna, Rochester, Maukato, and Eau Claire Wisconsin. I`he eorporate of&ces are in a leased 80,000 square foot facility in Minneapolis. In Minnesota this inclustry is at a$1.5 billion IeveL Werner revenues in 2006 were at $105 million with a growth rate of 25% in 2005 and 27% in 2006. Organization wide sales voiume is at $500 million which makes it the 18`" largest distributor in the nation. Werner has approximately 170 employees. Of these, 50 are warehouse and driver positions with an auerage annual income of $31,826. Additional are 120 professional �positions with average annual income of $71,451. A tolal of 90 positions are at the Minnea�olis location. � The Cottage Grove facility wili be the corporate headquarters for Werner. The facility will include 36,188 square feet of office and 86,400 square feet of warehousing in the first phase. Plans include an additional 12,080 square foot office area and additional warehousing up to another 75,150 square feet. The first phase, therefare, would include 122,588 square feet of office and distribution. The strueture will have a 32 foot elear height and 14 truck doors and one drive in door to service an estiinated 15 trucks/day located on the eastern side of the building. Employee and customer parking will Ue on the western building face. The office area will face north to take advantage of the adjacent Harnlet Park. The siCe wi11 receive access off the 95` Street fron2age through a private drive. Development Pro Forma As is the case n1 a11 of our industrial proj ects to date the City acquires land fsom WAG Farms, provides improvements to the land including utilities storm water facIlities and ofCen roadway improvements and site grading, and resells the iand at our cost of development. The transaction contcmplated herein includes the City acquisition of a parcei larger than the ulfimate development parceL This is proposed iu that the development provides the opportunity to leverage the project to address several community needs. Those needs are: providing ownership of land for regional and localized storm watex facilities; complete land acquisition for the planned for expansion of the Hamlet Park ballfields; provide for creation of a buffer between residential and industrial uses; provide for additional lot depths on a future residential cul-de-sac at a future extension of Hamlet Avenue; provide an industrial development opportunity. Currently, there is estimated to be 49.98 industrial acres north of 95 Street noY currently in City ownership. We would intend to acquire al1 of that acreage while decding back 1.45 acres immediately adjacent to the future residential cul-de-sac south of the dead ended Hamlet Avenue. Our net purchase thezefore would be approximateiy 48.53 acres. The purchase price is $3 million. All of this property not within the development site would be converted to park and storm water facilities. Additional storm ponding beyond that competed to date is contemplated immediately north of the development parcel in a location currentiy graded as a diteh seetion. �1s noted above we are proposing to purchase 48.53 acres for $3,000,000 and reselling approximately 20 aeres for $2,273,832. The City out af pocket expense for land acquisition therefore is $726,ll 8. We would propose that the ED Trust fund, storm water area and park dedieation funds be tapped to close this gap and to contlibutc toward �ading expense. Hamiet Park, as a result of Yhis project will gain about 28.5 additional acres, some of which will be used for storm water, making the park approxunately 158 acres in size (compared to Highlands at 65, Kingston at 55 and Woodridge at 50). Additionally, the development siCe is projected to generate a present value of $500,000 in tax increments. These increments would be allocated to site preparation, and storm drainage improvements. The allocation from the ED Trust is requested at $500,000 Yo provide fiuiding for storm ponding associated with the development site. The Park Trust Fund would contribute $543,520 toward land purchase (9.5 acres for ballfields less 1.45 deeded back to WAG = 8.05 acres @$1.55/SF =$543,520). The balance of necessaiy � funding wouid come from MNDOT (which has a projected 17% share) and storm water sources. It is suggested that not only is this development and its pieces good for the community but the project is providing substantial benefit to the adjacent residential neighborhood as well. Initially, this WAG Farms property was 79 acres in totaL We began review of this land parcel in 2002 wiYh a number of Council workshops and neighborhood meetings being heid fioin 2002 thzrough 2005 with the TIF process receiving a public hearing in April oF this year. Of the 79 acres, in excess of 60 were zoned and guided as industrial with the balance as residentiaL The residential por[ion includes 1and just to fhe south of Hamlet Avenue as well as a strip of 1and at the southwest portion of the site, primarily wesY of the sanitary sewer trunk. We are proposing to convert the southwestern land along with a western perimefer buffer strip and property uorth of the development parcel to park and open space. Further, the industrial parcel is sl�rinking in size from �l1at initial 60 acres down to approximately 20 acres ultimately (including the 1836 acres we had previously purchased and converted to park and ponding uses). The development pxocess would be as follows: 1. EDA entcrs development agreement with Werner and purchase agreement with WAG Farms (August 14) � 2. Council ralifies development andpurchase a�eements (August 15) 3. Planning Commission considers Site Plan (August 27) 4. Council Considers Site Plan (September 5) 5. EDA holds Business Subsidies Public Hearing (SepYember I i) 6. Closing date on Reai Estate (October 1) 7. EDA transfers Park site to City (2008) 8. Development completion (between May and Deeember 2008) Summary of Land Acquisition Funding of 48.53 acres: l. Werner Purehase agreement $2,273,$32 2. Park Trust Fund: 543,520 3. Storm Area Fund: 182,648 'T"otal $3,000,000 Summasy of Project Generated Funds available for Storm/grading projeet l. Tax Inerement: $ 500,000 2. ED Trust Fund: 500,000 3. Storm Area Fund: 200,000 4. MNDOT: 250,000 Total 1,450,000 (based on ariginal engineers estimate) Recommendation We are pleased to present this opportunity to Che EDA and the City CounciL We believe the end use is as is desired by Council, the end user is a quality, gxowing company, and the project addresses a number of community needs. Staff recommends positive consideration of the developmenf/purchase scenarios as presented. Represelltatives of Werner Electric Supply Minnesota include: Kevin Powell, President Craig Amundson, VP of Opexations Bryan Van Hoof, VP Brokerage Services, CB Richard Ellis Jack Glotkin, Partner, RJRyan Commercial Design and Construction EDA Action: By motion au2horize a purchase agreement with WAU Farms and development agreement with Werner Eleetric Supply Minnesota (and assigns) and request allocation of $500,000 from the ED Trust Fund toward project expenses. Council Action: By motion approve the recoinmendations and aetions o�Pthe EDA. Wemer 072407 � o� 6 < ��fi COOLZI M.Li,LU.005 ��i ,ii !� v,l l€ I � �=idl��ln sl i i 1 i i a � N � i — _ __ e7osauury�+ 'anwp aPe7lo� JIb1J313 213Ni13M �o� 8u�p�mg pasodoad $ iL_ _ _ _ _ . _ I � I .�"I z OS� 'lo �I ��6$ ° asa . _ �du i�°° ` — � � � I II' X �/I �� I _ �/ i q�6" � I s // � ` £ m � ) or j /� I /� j �� I I � � I p ., I i a.� . . e�__ � `%i �- I I � � s� � I I� ' i — --+� �i , oa _ ; ��._ xl � i r —� .� i � I � i " oi � i� � �LI s� �� I �� i i 'l'r�'� t, ['T � �'%/ //�� _:-7 I i i i „' f�'-k,,,-I i }� Fe�"4.,J'"l'7'� i ` I I1T .,�—� i I„� I�j i I � �Tln , . ; l /,. j � i� / ro e`Sw�— csc �e ". � � -s � i I I i I / � � BI� � �I1�� I1 I�r II�_�'{ ii�� '�IITUi� '� � �� ' /% � � ° y i�� o I ��/ /� �� ° 4�' � I i �n �i i ii � ��Li �' --� I u i'. �--`•- li �J--r--�,— � � �I�'/ /i 'v,�a i . i i � I i ' ''' �:.� ''''' �// /i !� �J � - „ , , i i � � — � _ :.+._ _ . � _ _ _� �= i . �; = . t / i iti � � L _ —_ . — — — _ _ / —/- ias , . / �. � ' "'_'_"_—'-- —_'_— � _/ . � .. � ��_.'_' . T _ � j j °�e� ✓'� / �� ,� �Q'� u < , � °)%� i .. , � �e� - e _ � " � � �� I � Q �. /i i� �C�� °�� ' �� I � .- / �� ,�, � � i' i � �� s� - �. i a `� �g �a ! I i,' i � � F� �" / �' � :% ��. �nsmo h " � a �e �i� � / ry a �" �p � I � � � i � � I i� I �� I i' { i' V C in � r 4 � � � SOUTH WASHINGTON COUNTY BULLETIN Nv t'ICE OF PUBLIC HF.ARINC CI'FY OF COTTAG� GROVF. COUNTY OT WASHINGTON STATE OF M[NNESOTA . NOTICS IS HERERY GIVHN th&t [he Ci[y Council of the Ciry of Cotiage Grove, Weshiugvo� County, Scate of Minnesota, will hoid a pu6lic hearing on April 18, 2007, at appmximetely 730 PM. at [he Cottage ocove City Co�ncil Chambers in City A�II, 75I6 SOth SC S., Co[tage Grove, Minriesota, reladng to the proposed adoptiw of a ModificaUOn to :he Developmen[ Progxam for Developmeot DisMct No. I(the'Developmcnt Progiazn Modification") and [he proposed zstablistunent of T.ix Increment Financing DistricC No. I�- 14 (en economic dovelopmeot nx inecemeot financiog disnic[) therein and the proposed adoption of a'Pax Inerement Financing Plan ([he "TIF Plan") [herefor (the Deveiopmen¢ Program Modifica6on� and the TIF Plan ace refesed to wllectively huein as the "Program Modification and 1TF Plan"), pursuan[ to Minnesota StmNtes, Sec[ions 469 090 to d69. t082, and Sections 469.174 ro 469.1799, all inclusive, as unended. Copies of rhe Program � Modifica[ion aud TIR Plan are ou file and availabte fior public inspecdon at Ne office of [he City Administramc at CiCy HaIL � The property ro be included in Tnx Incremene Pinaneing District Na L-14 is loea[ed withi� Development Dis[ric[ No. I nnd the Ciry of CoCmge Gcove. A mep of Developmen[ Dis[rlct No. 1 and Tax Inc�ement Pineociog DisKict Na I-14 therein is see forth below. Subject to certain Gmitacions, [� in¢emen[ from'Pax Inecement Pinancing Distrie[ No. 1-14 may be spen[ on niigible uses witltin the boundaries of Development District No. I. � CI lY f}F CO! t�� GSdUV� � wa�irvacrou ra>i 6ENE49PIrl$Nf QI$7i�JCT NtE, i �AXtNCREgENiFIhfANCY3(� W$7[y{�TNp 1-1d- � /�iiFl .. . . .x�. ��..� Uc. f+ iu0afl4 All interesteU pecso�s may xppear u( tha hearing and presen[ thev viewa ocalty or pno the meeting ui wriV�g. � BY ORDER OF THE CITY COUNCIL OF THL CPPY OF COTLAGE GROVE, MINNESOTA � /s/ Ryan Schroedu Ciry Administtaror f, :. 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'/ �ht y� h�� $ �/j� i .�� 4 � C��111 u ] � E; � ` r < , y �,� _ � �� d �` _= � k ,.�;',,,,, , ^ �%�J, � � � �,� ..,�.— ' . �� " � � ,,,.: � � �J � F � I' �.,+� �� ' � � �� , �u ,I i .�e:... � v�,-� `� ��";— " ``��`�' '� '�\\r �....::. a `�."��' �"'„ 1 ' :.*"i.=x, � � r.��,..ill�.e... g'.�..' \ \"� l,\ ��4^ \ i� � �� 9 � ��. a Y , ��`� m�.� d�C � ..�. 'F�y � � 1 � Y I � .. � � /v � `� ,. � �ti�' �� ,� �� ,:> �� , � ��. � ; 5 ;6�, ��t�. I �� i.� �� rs ia A {�` 4 ��y� DRAFT 8-09-07 CONTRACT FOR PRIVATE DEVELOPMENT By and Between COTTAGE GROVE ECONOMIC DEVELOPMENT AUTHORITY and WERNER ELECTRIC, MINNESOTA This documeut drafted by: KENNEDY & GRAVEN,CHARTERED 470 Pillsbury Center Minneapolis, MN 55402 (612) �337-9300 I t'�� :__ Section 11. Definitions ....................................... Section 1.2. Eachibits ........................................... Section 1.3. Rules of Interpretation .................... TABLE OF COI�TTENTS ............................................ ARTICLE I Definitions PAGE ........ 1 .......... 1 .......... 3 .......... 4 � ARTICLE II Representations and Warranties �Section 2.1. Section 2.2. Representations by the Authority .......................... Representations and Warranties by the Developer .......... 4 .......... 4 Section 31. Section 3.2. Section 3.3. Section 3.4. Section 3.5. Section 3.6. Section 3.7. ARTICLE III Conveyance of DevelopmenfProperty; Public Imui Couveyance of the Development Property Condition of Title ............................:.......... Financing .................................................... Testing ........................................................ Conditions Precedent to Conveyance........ Closing; Delivery and Recording .............. Grading; Plat .............................................. ARTICLE IV Construction of Minimum I�nprovements ........... 5 ..........: 6 ........... 6 ........... 7 ........... 7 ........... 7 ........... 8 Section 4.1. Conshuction of Minimum Improvements ................................................................... 8 Section4.2. Construction Plans ....................................................................................................... 8 Seetion 4.3. Commencement and Completion of Constructaon ...................................................... 9 Section 4.4. Certificate of Completion and Release of Forfeiture ................................................... 9 Section 4S Reconshuction of Improvements ............................................................................... 10 ARTICLE V Business Subsidy Act Requiremente Section 5.1. No Business Subsidy .................................................................................................. 10 ARTICLE VI Insurance Section 6.1. Required Insurance .... Section 6.2 Evidence of Insurance � ARTICLE VII Collection of Taxes; Assessment Aereement; Reimbursement ofbicrement ......... 10 ......... 11 Section Taxes .......................................................................................................................... 12 Section 7.2. Assessment A�,n .............................................................................................. 13 Section 7.3 Right to Collect Delinquent TaYes ............................................................................. 13 Section 7.4 Use of Tas Increments ............................................................................................... 14 Section 7.5. Reimbursement of Tax Inerement ............................................................................. 14 ARTICLE VIII Restrictions on Sale• Subordination Section 8.1 Resh�etions on Sale of Minimum Improvements ...................................................... 14 Section8.2 Subordination ............................................................................................................. 16 ARTICLE IX Events of Default Section 9. I. Events of Default Defined ......................................................................................... 16 Section 9.2. Remedies on Default .................................................................................................. 17 Section 9.3. Revesting Interest in the Authority Upon Happening of Bvent of Default Subsequent to Conveyance to Developer .................................................................. 17 Section No Remedy Exelusive ................................................................................................ 18 Section 9.5. No Addirional Waiver I�nplied by One Waiver ........................................................ 19 � ARTICLE X Additional Provisions Section 10.1. Secrio� 10.2. Section 10.3. Section 10.4. Section 16.5. Secrion 10.6. Section 10.7. ConflicC of Interests; Representatives Not Individually Liable ................... Equal Employrnent Opportunity .................................................................. Restrictions Use ...................................................................................... Provisions Not Merged With Deed .............................................................. Norices and Demands .................................................................................. Counterparts ................................................................................................. Disclaimer of Relationships ......................................................................... ............ 19 ............ 19 ............ 14 ............ 19 ............ 19 ............ 20 ............ 20 n TESTIMONNM............:................................................................................................................... 21 SIGNATURES .................................................................................................................................... 21 EXHIBIT A METES AND BOUNDS LEGAL DESCRIPTION OF DEVELOPMENT PROPERTY EXHIBIT B FORM OF QUZT CLAIM DEED EXHIBIT C LIST OF PRELIMINARY PLAN DOCUMENTS EXHIBIT D FORM OF CERTIFICATE OF COMPLETION AAID RELEASE OF FORFEITURE EXHIBIT � FORM OF ASSESS�vIENT AGREEMENT EXHIBIT F DRAFT OF PRELIMINARY PLAT OF iii CONTRACT FOR PRIVATE DEVELOPMENT THIS AGREEMENT, made this 16th day c�f August, 2007, by and between the Cottage Grove Economic Development Authority, a public body corporate and politic unde�• the laws of Miimesota, having its principal office at 7516 80�' Street South, Cottage Grove, Minnesota 55016- 3195 (the "Authority') and Werner Elechic, Minnesota, a Minnesota corporation, havin� its principal office at Minnesota 55 (the "Develope�"). WIT`?VESSETH: WHEREAS, the Authority created Development DistricY No. 1(the "Development District") and adopted a program (the "Program") for it, all in conformance with Minnesota SCatutes, Sections 469.124 through /+69.134, the Authority Developinent Districts Act (the "AeY'); and WHEREAS, ehe Authority has established ta�c increment financing district No. 1-14 ("TIF District No. 1-14") and has adopted a tax inorement finaneing (the "TIF P1an") related thereto; and WHEREAS, in order to achieve the objectives of the Program and the TIF Plan, the Authority is prepared to write down the cost of the Development Property, as hereinafter defined, construct certain public iinprovements and perform certain site unprovements benefiting the Development Property and otherwise assist the Developer in order to bring about development of the Development Property in accordance with the Program, the TIF Plan and this Ag�eement; and WHEREAS, the Authority believes that the development c��d witl�in TIF District No. 1- 14 pursuant to this Agree�nent and the fulfillment generally of this Agreement are in the vital and best interests of Cottage Crrove and the health, safety, morals, and welfaze of its residents, and in accord with the public purposes and provisions of the appiicable state and local laws and requirements under which the Development District has been undertaken. Iv�OW, THEREFORE, in consideration of the covenants and the mutual obiigaTions contained herein, die Authoiity and the Developer hereby covenant and a��ee with the other as follows: ARTICLE I Defmitions Section 1.1. Definitions. In this Ag� the following tenns shall have the meanings given unless a different meaning clearly appears from the context: "AcY' means the Authority DevelapmenY Districts Act, Minnesota Statutes, sections 469.124 through 469.134, as amended. 1 "AgreemenY' means this Agreement, as the same may be from time to time modified, aniended, or supplemented. "Assessment Agreeinent" means the agreement, in the fonn contained in E�ibit E attached hereto, among the Developer, the Authority and the Assessor and entered into pursuant to Article VII of this Agreement, which establishes a Minimum Market Va1ue for the Development Property and the Minimum Improvements. "Assessor" means the assessor far Washington County, Minnesota. "Authority" means the Cottage Grove Economic Development Authority. "Business Subsidy AcP' means Minnesota Statufes, sections 116J.993 through 116J.995 (the "Business Subsidy AcY'). � "Certificate of Completion and Release of Forfeiture" ineans the certificate, in the form contained in E�ibit D attached hereto, which will be provided to the Developer pursuant to Article IV ofthis Agreement. "City" mea�is the city of Cottage Grove, a municipal corporation under the laws of Minnesota. "ConsCrucCion Plans" means the final plans for construction of the Zvlinimwn Improveinents to be submitted by the Developer and approved by the Authority. "Count�' means Washington County, Minnesota. "Developer" means Werner Electric, Minnesota, a Minnesota corporation. "Development Propert}�' means the real property upon which the Minimum Improvernents wi11 be constructed, whieh property is legally described by metes and bounds in B�ibit A attached hereto. "Development Property Deed" means the quit claim deed in the form attached hereto as Exhibit B, by which the Authority will convey fhe Development Pro�erty to the Developer. "EDA AcY' or "Economie Development AuthoriCy AcY' means Minnesota Statutes, secYions 469.090 fluough 469.1081, as amended. "�vent of DefaulY' meaus an action by the Developer or the Authority Iisted in Article IX of this Agt'eement "Minimtun Inlprovements" means a warehouse and distribufion facility containing approximately 122,000 square feet eonstructed in accordance wiYh the Const�uction Plans submitted 2 to and approved by the Authority. After compleCion of the Minimum Unprovements, the Cerm shall mean the Development ProperCy as improved by the Minimum Improvements. "Minimum Market Value" means a market value for real estate taY purpases of at least $6,600,000 wiYh respect to the Development Property and Minnnum Improvements as of January 2, 2009 for taa�es payabte beginning in 2010 through the Temlination Date. -- "Preliminary Plans" means, collectively, the plans, drawings and specifications for the construction of the Minimum I�nprovements which are listed on B�ibit C attached hereto. "Sale" means any sale, conveyance, lease, exchange, forfeiture or otl�er transfer of the Developer's interest in the Minimuin Improveinents or the Development Property, whether voluntaty or involuntary. "State" Zneans the state of Minnesota. "Tax I�icrement Financing AcY' or "TIF Act" means Minnesota SCatu2es, sections 469.174 through 469.179, as arnended. "TaY Increment Finaiieing DistricP' or "TIF District" means U1e Authority's TIF District No. I-14. "Tax Increment Financing Plan" or "TIF Plan" means the tas inerement plan for TIF Bistrict No. 1-14. "Tax Official" means the Assessor, County auditor, Caunty or State board of equalization, the coiumissioner of revenue of the State, or any State or federal districY comt, the tax court of the Sfate, or the State supreme court. "Termination Date" means the date the TIF District terminates, which is expected to be nine yeazs after receipt of fhe first increment or 11 years after the date of ap�roval of the TIF PIan, whiehever occurs first� "Unavoidable Delays" means delays which are the direct result of unantieipated adverse weather conditions; sirikes or other labor troubles; fire ar other casualty to the Minimum Improvements; litigation commenced by third parties which, by injuncfion or otber sunilar judicial aerion, directly results in delays; or, except those of the Authority reasonably contemplated by this Agreement, any acts or omissions of any federal, State ar]ocal governmental unit which directly result in delays in construction of the Minimum Improvements. Secrion 1.2. Exlubits. The following exivbits are attached to and by referenee made a part of this Agreement: Eachibit A. Metes and bounds legal descripfion of flle Development Property Exhibit B. Form of Quif Claim Deed Exhibit C. List of Preliminary P1an Documents 3 E�ibit D. Form of Certificate of Complerion and Release of Forfeiture Exhibit E. Form of Assessment Ag}•eement E�ibit F. Draft of Preliminary Plat of Section 13. Rules of Interpretation. (a) This Agreement shall be interpreted in accordance with and governed by the laws of Minnesota. (b) The words "herein" and "hereof' anfl words of similar import, without reference to any particular secrion or subdivision, refer to this Agreement as a whole rather than any particular section or subdivision hereo£ (c) References herein to any particular section or subdivision hereof are to the seetion or subdivision of this Agreement as originally executed. (d) Any titles of the several parts, articles and secfions of tlus Agreement are inserted for convenience and reference onIy and si�all be disregarded in construing or interpreting any of its provisions. ARTICLE II Representations and WarranYies Secfion 21. Ret�resentations by the Authoritv. The Authority makes the following representations as the basis for the undertakings on its part herein contained: (a) The Aulhority is a publie body eorporate and politie under the laws of Minnesota. The Authority bas the power Co enter into this Agreement and cany out its obligafions hereu�der. (b) The persons executing this Agreement and related agreements and documents on behalf of the Authority have the authority to do so and to bind the Authority by their actions. (c) Development DisCrict No. 1 is a development district within fhe meaning of the Act and was created, adopted and approved in accordance witli the terms of the Act. (d) TIF Distriet No. 1-14 is an economic development taFC increment financing district within the meaning of the TIF Act. (e) The Autlioi7ty has received no notice or communication fi any local, State or federal official that the activities of'the Developer or the Authority in the Development District may be or will be in vi�lafion of any envu law or regulation. The Authority is aware of no facts the e�stence of which would cause it to be in violation of any local, State or federal environmental law, regulation or review proeedure. Section 2.2. REOresentations and Warranries by tlie Developer. The Developer makes the following representations as the basis for the undertakings on its part herein contained: 4 (a) The Developer is a Minnesota corporation, duly organized and iv good standing under the laws of Mtimesota and is not in violation of any provisions of iTs arCicles of incorporation or by-laws. The Developer has the power to enter into this Agreement and carry out its obiigations hereunder. The persons executing this Agreement and related agreements and documents on behalf of the Developer have the authority to do so and to bind the Developer by their acrions. (b) In the event the Development Property is conveyed to the Developer, the Developer will construct, operate and maintain the Minimum Improvements on the Development Property in substantial accordance with the terms of this Agreement, the Program, the TIF Plan, the Construcrion Plans and all 1oca1, SCate and federal laws and regulations, including, but not liinited to, environmental, zoning, building code and public health laws and regulations. (c) The Developer will apply for and use its best efforts to obtain, in a tiiuely manner, a11 required permits, licenses and approvals, and will meet, in a timely maamer, the requirements of a11 applicabie local, Stafe and federal laws and regulations which must be obfained or met before the Minirnum Improvements may be lawfully constructed or used for their intended purpose. (d) Neither the execution and delivery of this Agreement, the eonsumrnation of the transactions contemplated hereby, nar the fulfillment of or complianee with the teims and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach o� The terms, conditions or provisions ar any restriction or any evidence of indebtedness, agreement or instrument of whatever nature to which the Developer is now a pariy or by which it is bound, or constitufes a default under any of the foregoing. (e) The Developer would not be willing to construct the Minimum Improvements but for the commirinent by the Anthority to grant the financial assistance outlined in this Agreement and fhe use of ta�c increiuent for such assistance is essential to the Developer's ability to carry out its obligations under this Agreement. ARTICLE III Conveyance of Development Property; Public Improvements Section 31. Conveyance of the� Development Properiv. In order to facitifaYa �lie financial feasibility of the development of the Development Property and in consideration of the Developer's fulfillment of its covenants anfl obligations under this A�•eement to eonsfruct the Minimwn Im�rovements, and subject Yo the conditions precedent to closing outlined in Section 3.5 of this Agreement, the Authority agrees to sell the Development Property to the Developer for $2,273,832. The Development Property is legally described by metes and bonnds in Eaclubit A attached hereto. The Authority agrees to convey title and possession of the Developinent 'Pmperty to the Developex by quit claim deed in the form attached hereto as Exhibit B. The Authority sha11 arrange for the payment of all levied or pending special assessments priox to ciosing. The Developer azid the Authority agree to pro rate as of the date of closing any real piroperty taxes for the Development Property payable in the year of closin�. The Developer agrees to l�ay a11 real estate taaces payable 5 with regard to the Development Property in the years after closing. The conveyance of the Developrnent Property and the Develo�er's use of the Development Property shall be subject Co all of the conditions, covenants, resfrictions and limitaCions imposed by this Agreement, the Assessment Agreement and the Development Property Deed. The conveyance of title to tlle Development Property and the Developer's use of the Development Property sha11 also be subject to the building az1d zoning laws and ordinances and all other City, State and federal laws and regulation. Section 3.2. Condition of Tifle. Within 30 days of the date of tllis Agreement, the AuthoiiCy agrees to submit fo the Developer a commiYment for tiele insurance regardin� the Development Properiy. The Developer shall have 20 days after deliveiy of the commitment to examine same and to make any objections concerning the condition of title regarding the Development Property. Objections to the condiYion of title shall be made in writing and addressed to the Autbority. Failure on the part of the Developer to make objections within twenYy (20) days shall constitute a waiver of same and of the Developer's right to objeet to the condition of title. If fhe Develo�er provides v✓iitten objections to ritle, the Authority shall have forty-five (45) days thereafter fo cure the defects eitad by the Develo�er or to inform the Developer in writing that the Authority eannot or will not cure said defects. If there are no defects in title to whieh the Developer objecfs in writing or the Developer fails to object in a timely manner or if the Authority cures the defects within Che presciibed period, the pa� wi11 proceed to closing. If there are defects in title to wluch fhe Developer has objected in a tirnely manner and which the Authority cannot or will not cure, the Developer may terminate this Agree�nent aY its option within ten (10) days of notice from the AuYhoiiCy of its inability or unwiilingness to cure. The Authority shall have no obligation to cure any defects in the title of the Development Property. If the Developer chooses to terniinate this Agreement ptusuant to this Secfion 3.2, the Developer agrees to execute a quit claim deed regarding the Development Property 'sn favor of the Authority. Thereafter the parties shall have no further obligation towards one anotlier wifli regard to this Agreement or the Development Property. The Developer may also choose to proceed to cic�sing on the Development Property and Cake title subjecf to the defect. Notwithstanding any other provision herein to the conh•aiy, if the Developer proceeds to closing within less than the time periods set forth herein for receipt of a commihnent for title insurance and objection to title defects, sueh ac�ion shall be deemed to be a waiver by the Developer of its right to examine and object to the condifion of ritle of the Develo�ment Property. Section. 3.3. Financing. Before conveyance of the Development Property by the Authority, the Deveioper agrees to submiY to the Authority evidence of a commitment for financin� which is adequate, in the Authority's sole opiniou, for the eonshuction of the Minimum Improvements. If the Authority finds that the financing complies with the terms of this Section 33 and is sufficiently committed and adequate in amount to provide for the consYrucrion of the Minimum Improvements, flze Authority shall notify the Developer in writing of its approval. Sucb approval shall not be unreasonably withheld. If the Authority rejects the evidence of financing as inadequate, it shall do so in writing specifying the basis for the rejection and the Developer shall have 30 days thereafter to submit a commiTment for additional ar alCemate financing acceptable to the Authority. If the Developer fails to submit a commihneuY for finaneing acceptabie to the Authoriey within said period of time or any additional �eriod to whic]i the Authority may agree, the Authority may norify the Developer of its failure to comply with the requirement of this Section 33 and may terminate Yhis Ageement at its sole discretion. 6 Secfion 3.�4. Tesfin�. After execution of fllis Agreement and within 30 days thereafter, the Developer may notify the Authority of its desire to undertake tests and inspections of' tl�e Development Property regarding the presence of pollution, contamination ar hazardous substances on ihe Development Property and the suitability of the soils for the Developer's intended pur�oses. In the event that the Developer, following such fests and inspections, determines in its sole judgment that the condition of the Development Pro�erty is unsuitable for consri of the Minimmn Improvements, the Developer may terminate this Agreement and return the Developmenf Property to its condition prior to undertaking such tests and inspections. Regardless of whether die Developer avails itself of the right to conducf tests and inspections on the Development Property pursuan2 to Yhis Secrion 3.�}, a8er closing the Aud�ority shall haue no obligarion or liabiliCy Co the Developer for any unsuitability with respect to fhe soil conditions or the presence of any pollution, contaminarion or hazardous substances on the Development Property. Notwithstanding any other provision herein to the contrary, if the Developer proeeeds Yo closing within less than the period of time allowed in this Secfion 3.4 for testing, such action sha11 be deemed to be a waiver by the Developer of its right to test on tlie Development Property. Section 3.5. CondiYions Precedent Yo Convevance. Notwithstanding anything herein to the contrary, the Authority shall not be obiigated to convey the Development Property tc� the Developer until the following condi6ons precedent have been satisfied: (1) The Developer has submitted a commihnent or other evidence of financing which is adequate, in the Authoiity's sole discretion, to fully finance construction of the Minimum Improvements; (2} The Developer has submitted and the Authority has approved the Construcrion Plans, (3) The Developer has esecuted the Assessment Agreement in the form atfached hereto as E�ibit E; and (4) There has been no Event of Default on the part of the Developer which has not been cured. Section 3.6. Closin�: Deliveiv and Recordin�. Subject to the substantial sarisfacrion of all of the terms and eonditions contained in Chis Agreement which must be satisfied prior to the Authority's conveyance of the Development Property to the Developer, the Authority shall execute and deliver the Development Property Deed to the Developer at closing. Closiug shall occur on October 1,2007, or as soon thereafter as reasonably practicable. If closing has not occurred by December 31, 2007, either �arty may terminate this Agreement by notice to fhe other in accordance with Section 9.4 of this Agreement. The Developer shall have possession of the Development Properry upon closing. Closing shall be at the offices of Kennedy & Graven, Chartered, 470 U.S. Bank 'Plaza, 200 South Sixth Street, Minneapolis MN 55402 or such other location to which the parties may agree. Prior to ciosing, ihe Authority shall subnut to the Developer a copy of the Development Property Deed and other closing documeuts for review. The Development Property Deed shall be in recordable fonn and shall be reeorded auiong the County land records. The 7 Developer st�ail be responsible For the cost of recording the Development Property Deed, this A� and flie Assessment Agreement. The Developer shall pay at closing all fees associated with obtaining the commirinent for title insurance for the Development Propeity and far the policy of title insurance. The Developer and the Authority shall each pay at closing one-half of the closer's fee. Section 3.7. Grading_ Plat. (a) The City intends to grade the Development Property prior to its sale to the Developer. The grading will be rough site grading and will produce the elevation on the Development Property generally required for construction of Che Minimuan Improvements but is not inYended to be final grading. The Developer sha11 be permitted the opportunity to enter the Development Property and to test or inspect the grading a$er completion and before closing on the sale of the Development Properiy. Neither the City nor the Authority make any representations or warranties to the Developer or any other party regarding the site grading nor shall the City or the Authority be liable for any damage to the Minumun Improvemenfs which allegedly results from the sife grading. The Developer's decision to elose on the Development Property constitutes its agreement to indemnify and hold the City and Authority harmless against any elaim by the Developer or any other party for daxnages or injury arising out of or related to any site grading conducted by or on behalf of the City or the Authority. (b) The Authority agrees to plat the Development P1at prior to or after closing at no eost to the Developer. The final plat will be generally consistenY with the draft preliminazy plat attached hereto as E�ibit F. If platting oecurs after conveyance of fhe Development Property, the Developer agrees to cooperate with the City and the Authority in piatting the Development Property. ARTICLE IV Construcfion of Minimum Imnrovements Section 4.1. Consrivction of Minimum Im�rovements. The Develo�er agrees that it will construct the Minimum I�nprovements on the Development Property in accordance with the Construction Plans and af all times prior to the Tennination Date wili inaintain, preserve and keep The Minimum ImprovemenYs or cause the Miniinum Impi to be maintained, preserved and kept in �ood repair and condition. The Developer recognizes that it is because the Developer has agreed to construet the Minimmn Improvements t1�at the Authoi�ty is willing to offer the assistance outlined in this Agreement. The Developer acknowledges that, in addition to the requirements of this Agreeuient, conshuction of the Minimum Isnprovements wil2 uecessitate compliance with other reviews atld ap�rovals by the Authority and possibly other governmental agencies and agrees to subinit alI applicaflons for and �ursue Yo their conciusion ai1 other approvais needed prior Yo eonstructing the Minimum Improvements. Seetion 4.2. Conshucrion Plans. (a) Within 30 days after execufion of diis Agreement, the Developer sl�all subinit dated Construetion Plans to the AuthoriYy. The Construction Plans shall provide for flie construction of the Minimum finprovements and shall be in substantial confonnity with the Preliminary Plans and this Agreeinent. The Authority will a�prove the Construction Plans if they (1) conforrn to the Preliniinaiy Plans listed in E�ibit C attached herefo; (2) conform to all applicable federal, State and local laws, oxdinances, rules and regulations; (3) are adequate to 5 provide for the construction of the ivlinimum Unprovements; (4) confoim to the State building code; and (5) if tliere has occuired no uncured Event of Defauit on flie part of the Developer. No approval by the Authority sha11 relieve the Developer of the obligation to comply with the tenns of this Agreeinent, the terms of any applicable federal, State and IocaI laws, ordinances, rules and regulations in Uie construction of the Minimum Improvements. No approval by the AuUiority shalI constitute a waiver of an Event of Default. (b) If the Developer desires to make any change in the Construction Plans after their approval by the Aufhority, includin� any change to the design or mate�ials of the Minimum Improvements or any other change which would also require review or reapproval under any applicable code, ordinance or regulation, the Developer sha11 submit the proposed change to the Authority for its approval. If the proposed change conforms to the requirements of this section 4.2 with respect to the original Constiucfion Plans or is otherv✓ise acceptable to the Authority, the Authority shall approve the proposed change. Such change in the Construction Plans shall be deemed approved by the Audiority unless rejected, in whole or in part, by written notice by the Authority fo the Developer, setting forth in defaii the reasons therefor. Such rejection shall be made within 10 days after receipt of the written notice of such change from the Developer. Section 43. Commencement and Completion of Construction. Subject to Unavoidable Delays, the Developer shall commenoe constnzction of the Minimum Improvements no later than May 30, 2008. Subject to Unavoidable Delays, the Developer shall have substantially completed the construction of the Minimum Improvements no later than December 31, 2008. All work with respect to the Minimum Improvements to be consTructed or provided by the Developer on the Development Pm�erty shall be in confoimity with the Construction P1ans. The Developer shall make such reports to the Authoiity regarding construction of the Minimum Improveinents as the Authority deems necessary oc helpful in order to monitor progress on construction of the Minimum Improvements. Section 4.4. Certificate of Completion and Release of Forfeiture. (a) After substantial completion of the Minnnum Improve�nents in accordance with the Construction P1ans and all terms of this Agreement, the Authority will furnish the Developer with a Certificate of Completion and Release of Forfeiture in flie fonn of Bxhibit D hereYo. Sueh certification by the Authority shall be a conclusive detennivation of satisfacrion and terminafion of the agreements and covenanYs in this Agreement and in the Development Property Deed with respect to the obligations of the Developer to conshuct the Minumm� Improvements and flie dates for f1�e beginning and completion thereof. The Certificate of Completion and Release of Porfeiture shall only be issued after issuance of a certificate of occupancy by the City. (b) Thc Certificate of Completion and Release of Forfeiture provided far in this secfion 4.4 shall be in such fonn as will enable it ta be recordecl in the �roper County office for the recordation o£ deeds and other instruments �ertaining to the Development Property. If Yhe Authority sha11 refuse or fail to provide such certification in accordance wifli the provisions of this section 4.4, the Aufliority shall, within 30 days after written request by Yhe Developer, provide the Developer with a written statement, indicating in adequate detail in what respects the Developer has failed to complete flie Minimum I�nprovements in accordance with the provisions of the Agreement, or is otherwise in default of a nlateiial te1�n of this Aa�eement, aud what measures ar acts will be 9 necessary, in the opinion of the Authority, for the Developer to take or perfonn in order to obtain such cerCification. Section 4.5. Reconstruction of finprovements. If the Minimum finprovements are damaged or destroyed before or after completion thereof and issuance of a Certificate of Completion and Release of Forfeiture, but before the Termination Date, the Developer agrees, for itself and its successors and assigns, to reconstruct the Minimum Improvements to a value at least equal to the Minimum Market Value witliin one year of the date of die damage or destruction. No delay or failure by the Developer or any successor or assign to reconshuct die Minimum I�nprovements as required by this Section 4.5 shall alter or limit the Developer's obligations under the Assessment Aa eement, which shall remain in full force and effect until the Terminarion Date. The Minimwn Improvements sha11 be reconstructed in accordance with the approved Conshuction Plans, or such modifications thereto as may be requested by the Developer and approved by the Authority in accordance with Section 4.2 of this Agreement. The Developer's obligaYion to reconstruat the Minimum Improvements pursuant to this Secfion 4.5 shall end on the Termination Date. ARTICLE V Business SubsidV Aet Requirements Section 51. No Business Subsidv. The Authority and the Developer agcee that the price the Developer will pay the Authority for the Development Property is equal to or exceeds its fair market value, including the pw•chase price and the value of improvements or other benefits conferred by the Authority or the City. Accordingly, there is no business subsidy within tlse meaning o£the Business Subsidy Act in flie transaction beYween the Authorify and the Developer. ARTICLE VI Insurance Section 6.1. Required Tnsurance. (a) The Developer agrees to provide and maintain at all times during the process of constructing the Minimum Im�rovements 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 uisurance, written on Yhe so-called `Builder's Risk -- Completed Va1ue Basis," in an amount equal to 100 percent of tl�e insurable value of the Minunum I�nprovements at the date of complerion, and wifh coverage available in non- reporting form on the so called "al1 risk" fonn of policy; (ii) Com�rehensive general liability insurance (including operations, contingent liability, operations of subconfi eompleted operations and contractual liability insurance) together with an Owner's Contractor's Policy with limits against bodily injury vid 10 property damage of not less than $1,000,000 for each occurrence (to accomplish the above - required limits, an umbrella excess liability �olicy may be used); and (iii) Workers' compensation insurance, with statutory coverage. The policies of insurance xequired pursuant to clauses (i) and (ii) above shall be in forcn and content reasonaUly satisfactory to the Authorify and shall be placed wifh financially sound and reputable insurers licensed to fransact business in Minnesota The policy of insurance delivered pursuant to clause (i) above sha11 contain an agreement of the insurer to give noY less than 30 days' advance written notice to the AuthoriYy in the event of cancellation of such policy or change afFecYing tha coverage thereunder. (b) Upon complerion of constt of the Minimum Improvements, and prior to the Termination Date, the Developer shall maintain, or cause to be maintained, at its cost and expense, and froin time to time at the request of the Authority shall furnish proof of the pa}nnent of premiums on, insurance as follows: (i) Insurance against loss and/or damage fo the Minimum Improvements under a policy or policies covering such risks as are ardinarily insured against by similar businesses; including (without limitin� the generality of the foregoing) fire, extended coverage, vandalis�n and malicious mischief, heating system explosion, water damage, demolition cost, debris removal, collapse and flood, in an amount not less than the fu11 insurable replacement value of the Minimum Improvements or the Minimum Market Value, whichever is greater. No policy of insurance sha11 be so written that the �roceeds thereof wi11 produce less than the minirnum coverage required by the preceding seutence, by reason of coinsurance provisions or otherwise, without the prior consent tl�ereto in writing by fhe Authority. The term "full insurable replacement value" shall mean the actual replacement eost of the Minimum Improvements and shall be determined from Yime to time at the request of the Authority, but not more frequenfly flian once every three years, by an insurance consultant or insurer, selected and paid for by the Developer and approved by the Authority; and (ii) Such other insurance, including worker's compensation insurance respecting all employees of the Develo�er, in such amount as is customarily carried by like organizations engaged in like activities of comparable size and liability exposure; provided that the Develo�er may be self-insured wit12 respect to all or any part of its liability for worker's compensation. Section 6.2. Evidence of Insm•ance. All ilisurance required in tlus Article VI shall be tal�en out and maintained in responsible insurance cornpanies selected by the Developer which are authorized under the laws of Minnesota to assume the i�sks covered thereby. The Developer agsees to deposit annually with the Authority copies of policies evidencing all sueb insurance, or a ceriificate or certificates or binders of the respective insurers staeing that such insurancc is in force and effect. Unless otherwise provided in this Artiele VI, each policy sha11 contain a provision that the insm�er sha11 not cancel nor materially modify it witbout giving written notice to the Developer and the Authority at least 30 days before the cancellation or modification becomes effective. Not ll less jhan IS days prior fo the expiration of any policy, the Developer shall furnish the Authority evidence satisfactory to the Authority that 2he �olicy has been renewed or replaced by another poliey conforming to the provisions of this Article VI, or that there is no necessity therefor under the terms of this Ag� in Iieu of separate policies, the Deveioper may maintain a single policy, blanket or iunbrella policies, or a combination thereof, liaving the coverage required herein, in which event the Developer shall deposit with the Authority a certificate or certificates of the respective insurers as to the amount of coverage in force upon the Minimum Improvements. ARTICLE VII Collecrion of Taxes; Assessment A�reement; Reimbursement of Inerement Section '71. Taxes. The Developer agrees that prior to the Teiznination Date: (1) it will not seek administrative or judicial review of the appiicability of any tax statute determined by any Tax Official to be applicable to the Minimum Im�rovements or the Development Property or raise the inapplicability of any such tax statute as a defense in any proceedings, including delinquent Tax proceedings; (2) it wi11 not seek administrative or judicial review of the constituYionality of any tax statute determined by any Tax Official to be applicable to the Miilimum Improvements or the Development Property or raise the unconstitutionality of any such tar statute as a defense in any proceedings, including delinquent taY proceedings; (3) it will not cause a reduction in the Minimum Market Value paid in respect of the Minimum Improvements through: (a} willful destruetion of the Minimum Improvements ar any part thereof; (b) willfui refusal to reconstruct damaged or destroyed property pursuant to section 4.5 of this Agreement (e) a request to tlie County assessor to reduce the Minimum Market Value of all or any portion of the Minimum Improvements, (d) a petition to the board of equalization of the County to reduce the Minimwn Market Value of all or any portion of the Development Property; (e) a petition to the boasd of equalization of the State or the commissioner of revenue of the Sta�e fo reduce the Minimum Market Value of all or any portion of the Developnlent Property; (fj azi action in a district courC of the State ar the tax court of the State seekin� a reduction in the Minimum Market V alue of the Development Property; (g) an appIication to the commissioner of reve�iue of the State or to any local taxing jurisdiction requesting an abatement of real property taxes; 12 (h) any othcr proceedings, whether administrative, legal or equitable, with any adr�inistrative body within tha County ar the SCate ar with any court of the State or the federal government; or (i} a transfer of the Development Property or Minimum Improvements, or any pv thereof, to an entity exempt from the payment of real properry taa�es under S4ate law. The Developer shall not, prior to the Tennination Date, apply for a deferral of property tax on the Development Property or the Minunum Improvements. Section 7.2. Assessinent A� (a) Prior to conveyance of the Developinent Property, the Develo�er and die AuthoriYy agree to execute an Assessment Agreement pursuanY to Minnesota Statutes, Section 469177, subd. 8, specifying the Minimunl Market Value for the Development Property together with the Minimum Improvements. The amount of the Minimum Market Value shall be no less than $6,600,000 as of January 2, 2009 for taaces payable beginning in 2010 through the Tennination Date, notwithstanding any failure to complete construction of the Minimum Improvements by the date specified in Section 4.3 of this Agreement. (b) The Assessment Agreement shall be substantially in the foim attached hereto as E�ibit E. Nothing in the Assessment Agreement shall limit the discretion of the Assessor fo assign a market value to the Developmenf Property and Minimum Iiuprovements in excess of sueh Assessor's Minimum Market Value nor prohibit the Developer from seeking through the exercise of legal or administrative remedies a reduclion in such market value for properiy taY purposes; provided, however, that the Developer shall not seek a reduction of such market value below the Assessor's Minimum Market Value set forth in the Assessment Agreement in any year so long as such Assessment Agreement shall remain in effect. The Assessment Agreement shall remain in effect until the Ternlination Date; provided that if at any time before flie Tennination Date the Assessment Agreement is found to be terminated or unenforceable by any TaY Offieial or court of competent jurisdiction, the Minimum Maz Value described in this Section 7.2 sha11 remain an obligation of Yhe Developer or its successors and assigns (whEther or not such value is binding on the Assessor}, it being fhe intent of the parties that the obligation of the Developer to maintain, and not seek reduction of, the Minimum Market Va1ue specified in this Section 7.2 is an obligation under this Ageement as weli as under the Assessment Agreement, and is enforceable by the AuthoriYy against the Developer, its successors and assigns in accordance with the terms of this Agreement. Section 7.3. RiQht to Collect Delinquent Taaces. The Developer acknowledges that the Authority is providing substantial aid a�id assista�lce to the Developer t1u sale of the Development Propc�rty for less than market value and Che provision of eertain �ublic and site improvements without cost to the Developer. The Developer understands that the real estate taxes on the Developinent Property and the Minimum I�nprovements must be promptly and fimely paid. To that end, the Developer agrees for itself, its successors and assigns, in addition to tl�e obligation pursutuit to seatute to pay real estate taxes, that the Developer is also obligated at all times prior to the Termination Date by reason of this Agreement fo pay before delinquency all reai es2ate taxes assessed against the Development Properiy and fhe Minimum Iinprovements. The Developer acknowledges that at all times prior to the Termination Date this obligation ereates a conn 13 right on behalf of the Authority to sue fhe Developer or its successors and assigns to collect delinquent real estafe taYes and any penalty or interest thereon and to pay over the saane as a taac payment to the County auditor. In any such suit, Uie Authority sha11 also be enfitled to recover its reasonable out-of-pocket costs, expenses and attorney fees. Section 7.4. Use of Tax Inerements. The Authority shall be free Yo use any tax increment received from the Minimum Improvements for any purpose for which such increments may lawfully be used under the TIF Plan and pursuant to the provisions of State law, and the Authority shali have no obligations Yo the Developer wifh respect to the use of such increment. Section 7.5. Reimbursement of TaY Increment. Minnesota Statute, section 469.176, subd. 4c limits the use of tax inerement in an economic development district to projecYs occupied by permitted uses. Minnesota Statutes, section 469.1771 requires the Authority to reimburse inerement distributed Co it and used Yo assist a project which does not qualify for taY increment assistance. If the Anfhority is required fo reimburse taY inarerraent to the Counfy or any oflier governmental entity pursuant to Minnesota Statutes, section 469.1771, or any other provision of the TIF Act, the Developer agrees to reimburse a similar amount to the Authority within 30 days' written notice to the Developer. The Authority may add interest on the unpaid balance at 8 percent per year beginning on the 31 s ` day after notice to the Developer. Failure by the Developer to reimburse the Authozity pursuanC to this seetion 7.5 shall constitute a lien on tlie Development Properiy. ARTICLE VIti Restrictions on Sale• Subordination Section 8.1. Restricfions on Sale or Assi�nment. The Developer represents and agrees that its purchase of the Development Property and its other undertakin�s pursuant to this Agreement, are, and will be used, for the purpose of development of ihe Development Piroperty and not for speculation in land holding. The Developer represents and agrees that: (a) Pi7or to issuance of the Certificate of Completion for fhe Minimum Improvements, except security for, and only for, the purpose of obtaining financing necessary to enable the Developer to perfonn its obligations with respect to the Minimum finprovements under this Agreeinent, and any other purpose authorized by this Agreenient, the Developer has not made or ereated and will not make or areate or suffer to be made ar created any total or parCial Sale in any mode or fornl of or witb respect to the Minimum Im�rovemenY or the Development Property or any part thereof or any interest therein, or any contract or agreement to do the same, without the prior written approval of the Authority unIess the Developer-remains liable and bound by this Agreernent in whieh event the Autlaority's approval is not required. Any such Sale shall be subject to the provisions of this Agre�snent. (b) In the event the Developer, u�on Sale of the Development Property or any portion fhereof, seeks to be released fi•om its obligations under this Agreement as to the �ortione of the Minimum Iinprovements or Development Property that is subject to the Sale, the Authoz�iy shall 14 be entitled to require, except as othercvise provided in the Agreement, as conditions to any such Sale that: � (i) Any proposed transferee shall have the qualifications and fmanciai responsibility, in ihe reasonable judgsnent of the Authority, necessary and adequate to fizifill ihe obligafions undertaken in this Agreement by the Developer as to the porEion of flie Minimum finprovements or Development Property subject to the Sale. (ii) Any proposed fransferee, by instrument in writing satisFaetory to the Authority and in form recordable among die County land records, shall, for itself and its successors and assigns, and expressly for the benefit of the Authority, have expressly assumed a11 of the obligations of the Developer under this Agreement as to the portion of the Minimum Improvements or Development Property subject to the Sale and agreed to be subject to a11 ffie conditions and restrictions to wbich the Developer is subject as to such portion; provided, however, that the fact that any transferee to, or any other successor in interest whatsoever of, the Minimum Improvements or Development Property, or any part thereof, shall not, for whatever reason, have assumed such obligafions or so agreed, and shall not (unless and only Co the extent otheiwise specifically provided in this Agreement or agreed to in writing by the Authority) deprive the Authority of any rights or remedies or controls with respect to the Development Property or any part tllereof or the construction of the Minimum Improvements; it being the intent of the parties as expressed in this AgreemenC diat (to the fullest exfenf peimitted at law and in equity and excepting only in the manner and to the extent specifically provided otherwise in this Agreement) no Sale of, or cliange with respect to, ownership in the Minimum Improvements or Development Property or any part thereof, or a�y interest therein, however consummated or occurring, and wliether voluntary or involuntaiy, shali operate, legally or practically, to deprive or limit the Authority of or with respect to any rights or remedies or controis provided in or resulting from this Agreement ��ith respect to the Minimum Improvements or Development Property that the Authority would have had, had there been no such Sale. In the absence of s�ecific written ageement by the Authority to the contraiy, no Sale or approval by the Authority thereof shall be deenled to relieve the Developer, or any other party bound in any way by this Agreelnenf ar otherwise with respect to the construction of ihe Minimum Iinprovements, from any of its obligations with respect thereto. (iii) Any and all insti�menYs and other legal documents involved in effecting the Sale of any interest in this Agreenlent or The Minimum I�nprovements or Development Property governed by this Article VIII, shall Ue in a form reasonably satisfactory to the Authority. (c) Any notice of rejecCion shall contain detailed reasons for the rejection. The Authority's approval of any Sale shall not be unreasonably withheld. In the event the foregoing conditions are sarisfied, the Developer shall be released from its obligation under this AgreemenC as to the porCion of the Minimum Improveme�sts or Development Property fhat is subject to the Sale. 15 (d) After issuance of the Certificate of Completion for the Minimum Improvements, the Developer may transfer or assign any portion of the Development Property or the Developer's interest in this Ageement for which a Certificate of Comp]etion has been issued, without the prior written consent of the Andiority, provided that the transferee or assignee is bound by all the Developer's obligations hereunder. The Developer shall submit to the Anthority written evidence of any such transfer or assignment, including the transferee or assignee's express assumption of the Developer's obligations under this Agreement. If the Developer fails to provide such evidence of transfer and assumption the Developer shall remain bound by a11 it obligations under this Agreement. Section 8.2 Subardination. The Authority agrees that, upon request by the Developer, the Authority will subordinate its interests under this Agreement to the mortgage lien for an acquisifion, construction and permanent loan made with respect to tl�e Development Property and the Minimum Improvements. Such subordination shall be evidenced by an agreement in form and substance satisfactory to the Authority. Notwithstanding anything herein to the contrary, the Authority will not subordinate its rights under the Assessment Agreement. ARTICLE IX Events of Default Section 9.1. Events of Default Defined. Each and every one of the following shall be an Event of Default under this Agreeinent: (a) Failure by the Authority or the Developer to proceed to elosing on the Development Property after compliance wifh or the occurrence of ail conditions precedent to closing; (b) Fai1m•e by the Developer to commence and complete construction of the Minimum Improvements pursuant to the teinis, conditions and limitations of Article IV of this Agreement, including the timing thereof, unless such failure is eaused by an Unavoidable Delay; (c) Failure by the Developer Yo pay real estate taxes or special assessments on the Development Property and Minimum Impirovements as they become due; (d) Ap�eal or ehallenge by the Developer or any party on its behalf of tke Minimum ivlarket Va1ue prior to t11e Tennination Date; � (e) Use by f1�e Developer or ofhers of the Miniui� Improvements for pui�oses odier than those contemplated and pennitted by this Agreement, including failure to comply wi4h Sections 7.5 and 103 of this Ageeiuent. (� Transfer or SaIe of the Development Property or the �Iinimum Improvements or any part th�reof by fhe Develope� in violation of Sections 71 or 81 of this Agreement and without flie prior written permission by the Authority; 16 (g) If the Developer shall file a petition in banlmiptcy, or shall make an assignmen4 for the benefit of its creditors or shall consent to the appoinhuent of a receiver; or (h) Failure by either party to observe or perform any mateiial covenant, condition, obligation or agreement on its part to be observed or perfonned under this Agreement or the Assessment Agreement; Section 9.2. Remedies on Default. Whenever any EvenY of DefaulY refelred to in seetion 91 of'this AgA•eement occurs, the non-defaulting �arty may take any one or more of the following actions after providing 30 days written notice to the defaulting party of the Event of Default, but oniy if the Event of Default has not been cured within said thirty days or, if the Event of Default is by its nature ineurable within 30 days, Uie defaulting party does not provide assurances to the non- defaulting party reasonably satisfactory to the non-defaulting party that the Event of Default wi11 be cured and wili be cured as soon as reasonably possible: (a) Suspend its performance under this Agreement, including refusing to elose on the Development Psaperty, until it receives assurances from the defaulting party, deemed adequate by the non-defaulting party, that the defaulting pariy wi11 cure its default and continue its performance under this Agreement; (b) Terminate or rescind this Ag•eement; (e) If the default occurs prior to completion of the Minimum Im�rovements, the Authority may withhold the Certificate of Completion and Release of Forfeiture; (d) If the default occurs prior to issuance of t11e Certificate of Completion and Release of Forfeiture, revest title in the name of the Authority pursuant to Section 9.3 of this Agreement; (e) Enforce the Assessment Agreement; and (fl Take whatever action, including legal or administraTive action, which may appear necessary or desirable Yo the non-defaulting pazty to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant of the defaulring party under this Agreement or the Assessment Ag�•eement. Section 93. Revestin� Interest in the Authoritv Upon Happenine of Event of Default Subsequent to Convev�ce to Developer. In the event that subsequent to conveyance of the DevElopmBnt Property to the Developer and prior to the issuance of a Certificate of Complerion and Release of Forfeiture far the Minimuin Improvements: (a) tlie Developer, subject to Unavoidable Delays, faIls to begin construction of the Miuimum Improvements in confonnity with this Agzement and such failure to begin construction is not cured wifhin 30 days after written norice from the Authoi7ty to the Developer to do so; or 17 (b) subject to Unavoidable Delays, the Developer, afler commencement of the construction of Clle Minimum Improvemen�s, fails to carry out its obligations with respect to the completion of construction of the Minimum Irnprovements (including the nature and the date for the completion thereo fl, or abandons or substantially suspends conshuction work, and any such £ailure, abandonment, or suspension shall not be cured, ended, or remedied within 30 days after un demand from the Authority to the Developer to do so; or (c) the Developer shall fail to pay real estate taxes or assessments on the Development Property when due, or shall place thereon any encumbrance or lien unauthorized by this Agreement, or sha11 suffer any levy or attachment to be made, or any materialmen`s or meclianics' l.ien, or any other unauthorized encumbrance or lien to attach, and such tases ar assessments shall not have been paid, or the encumbrance or lien removed or discharged or provision satisfactory to the Authority rnade far such payment, removal, or discharge, within 30 days after written demand by the Authority to do so or sueh longer period, not to exceed 60 days, as may reasonably be necessary to remove said lien or encumbrance; provided, that if the Developer shall first notify the Authority of its intention to do so, it may in �ood faith contest any mechanics` or other lien to remain undischarged and unsatisfied during the period of such contest and any appeal, but only if the Developer provides the Authority with a bank letter of credit or other security in the arnount of the lien, in a form satisfactory to the Autliority, pursuant fo which the bank wi11 pay to the Authority the amount of any lien in the event the lien is finally determined to be valid or, as an alternative to such forms of security, has made a deposif wifh the district court in fhe manner provided in Minnesota Statutes, section 514.10. Duiing the course of such contest, the Developer shall keep the Authoiity informed respecting the status of sueh defense; or (d) there is, in violation of Seetions 7.1 or 8.1 of this Agreement, any transfer of the Development Property to an entity exempt from payment of real estate taxes or any Sale of the Development Property ar the Minimum Improvements or a�iy part fliereof, and such violation sl�all not be cured within 30 days after written demand by die Authority to the Developer, then the Authority shall have the right to re-enter and take possession of the Development Property and to terminate and reves2 in tlie Authority the interest of the Developer in the DevelopmenY Properiy; provided, however, that any exercise by flse Authority of its rights or remedies hereunder sha11 always be subject to and limited by, and shall not defeat, render invalid or limit in any way the lien of any mortgage or otl�er eneumbrance specificaily and previously authorized by the Authority in wriring under this Agreement or any rights or interests provided in this Agreement for ihe protection of the holders of an approved encumbrance. SecCion 9.4. No Remedv Exclusive. No remedy herein conferred upon or reserved to Yhe parties is intended to be exclusive of any other available remedy or 1 but each and every such reinedy shall be emizulative 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 righY or power aceruing upon any dEfault shall iinpair any such right or power or sball be construed to be a waiver thereof, but any such right aild power may be exercised from ti�1e to time and as often as may be deemed expedient. In order to enritle the Aufliority or the Developer to exercise any reniedy reserved to it, it shall not be necessary to give notice, other than sueh notice as may be required in luticle IX of this A� 18 Section 9.5. No Additional �TJaiver Implied bv One Waiver. In the event any covenant or 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 pa� breach so waived and sha11 not be deemed to waive any other concurrent, previous or subsequent breach hereunder. ARTICLE X Additional Provisions Section 101. Conflict of Interests; Representatives Not Individually Liable. No officer, official, or employee of the Authoriry shall have any persanal financial interest, direet or indirect, in this Agreement, nor shall any such officer, official, or em�loyee participate in any decision relating to the Agre�nent which affects his or her personal financial inCerests, directly or indirectly. No offieer, official, or employee of the Authority shali be personally liable to the Developer, or any successor in interest, in the event of any default or breach or for any amount whieh may become due or on any obligation under the terms of this Agreement. Section 10.2. Equal Emplovment Opportunitv. The Developer, for itself and its successors and assigns, agrees that during tlie construction of the Minimum Improvements provided for in this Agreement, it will comply with a11 applicabic equal employment and nondiserimination laws and regulations. Section 10.3. Resh on Use. The Developer, for itself and its successors and assigns, ab ees to devote the Property and Minimum Improvements only to such land use or uses as may be permissible under the City's land use regulations. The Develo�er, for i2self, its successors and assigns, aciniowledges the liLnitations on use of the Property and the Muiimum Improvements imposed by Section 469.105 of the EDA Act and ag to comply with such restrictions. The Developer, for itself and its successors and assigns, acknowledges the limitations on the use of the Property and the Minimum Improveinents imposed by Section 469.176, subd. 4c of the TIF Act and agrees to comply with such resriicrions through Che Terminafion Date. Section 10:4: Provisions Not Merged With Deed. None of Yhe provisions of this Agreement is intended to or shall be merged by reason of delivery of the Development Property Deed and the Development Property Deed shall noT be deemed to affect or inzpair the provisions and covenants of this Agreement. Section 10.5. NoYices and Demands. ExcepC as otherwise expressly provided in this Agreement, any notice, demand, or oCher commuisication under the AgreemenY or any related documeilt by either party to the other shall be sufficiently given or delivered if it is dispatched by re�istered or certified United States mail, postage prepaid, retum reeei�t requested, or delivered personally to: 19 (a) ro> in the case of the Authoiity: in the case of the Developer: 7516 80�' Street South Cotta�e Grove MN 55016 Attn: EDA Executive Director Werner Electric, Minnesota Attn: or at such other address with respect to either such party as that paz may, from time to tune, designate in wriring and forward to Yhe other as provided in this section 10.5. Seetion 10.6. Countemarts. This Agreement may be executed in any number of countetparts, each of which shail eonstitute one and the same instrument. Section 10.7. Disclaimer of Relarionships. The Developer aclmowledges that noflling contained in fliis Agreement nor any act by the Authority or the Developer shall be deemed or construed by the Developer or by any third person to create any relationship of third-party beneficiary, principal and agent, limited or general partner, or joint venture between the Authority and the Developer. �*��*��:��*��*��: 20 I'� WITNESS WHEREOF, the Authority and the Developer have caused this Agreement to be duly executed in their names and behalves on or as o£t1�e date first above written. COTTAGE GROVE ECONOMIC DEVELOPMENT AUTHORITY By Its President By Its Executive DirecYor STATE OF MIA�IVESOTA ) � ) SS � COUIv�TY OF ) The foregoing instrument as acknowledged before me this day of , 2007, by and , president and execuCive director, respectively, of the Cottage Grove Economic DevelopmenY AuthoriYy, a public body corporate and politic under the Iaws of Miimesota, on behalf of the Economic DeveIopment Authority: Notary Public 21 WERNER EL�CTRIC, MINNESOTA I: Its STATE OF MII��IVESOTA ) ) ss COUl�rTY OF ) The foregoing instrument was executed this day of , 2007, by , the of Werner Electric, Minnesota, a Minnesota cor�oration, on behalf of the corporarion. Notary Public 22 EXHIBIT A IVIETES AND BOiJNDS LEGAL DESCRYPTION The Development Properry is located in Washingfon County, Minnesota, and is legally desciibed as follows: [need complete 1ega1 prior to execurion) A-1 EXHIBIT B FORM OF QUIT CLAIM DEED [to be completed] C EXHIBIT C F�IST OF PI2ELIMINARY PLAN DOCUMENTS "I'he Minimum finproveinents shall be constructed in accordance wifli the following preliminary plan documents: [to be completed] C-1 EXHIBIT D FORM OF CER7TFICATE OR COMPLETION AND RELEASE OF FORFEITURE WHEREAS, the Cottage Grove Economic Development Authority (the "Grantor"), by a deed recorded in the office of the County Recorder in Washington County, Minnesota, as Document No. , has conveyed to Wenler Elect��c, Minnesota, a Minnesota cor�oration (the "Grantee"), the following deseribed land in County of Washington and State of Minnesota, to-wit: (4o be comple�ed prior to execution) and WHER�AS, said deed was executed pursuant to that certain Contract for Private Development by and between the Grantor and the Grantee dated fhe day of , 2007 and recorded in the office of the County Recarder in Washington County, Minnesota, as Document No. , which Contract for Private Development contained certain covenants and restrictions regarding completion of the Minimum Improvements; and WHEREAS, said Grantee has performed said covenants and conditions in a manner deemed sufficient by the Grantor to perniit the execution and recording of this certification. NOW, THEREFORE, this is to certify that all construction of the Minimum Improvements specified to be done and made by the Grantee has been completed and the covenants and conditions in the Contract for Private Developinent have been perfonned by the Grantee flierein and that the provisions far forfeiture of title and ri�t to re-entry for breach of condition subsequent by Grantor is hereby released absolutely and forever, and the " County Recorder in Washington County, MinnesoCa, is hereby aufhoiized to accept for recording and to record Che filing of this instiwnent, to be a conclusive determination of the satisfactory terc�ination of the covenants and condirions relating to completion of the Minimum Improvements: Dated: , COTTAGE GROVE ECONOMIC � � DEVELOPMENT AUTHORITY By Its President By Its Exeeutive Direetor D-1 STATE OF MINNESOTA ) ) ss. COtiNTY OF ) The foregoing insnument as acirnowledged before me this day of , 2008, by and , the presideut and executive director, respecCively, of fhe Cottage Grove Economic Development Authority, a public body coiporate and politiq on behalf of the Economic Development Aufhority. Notary Public D-2 EXHIBIT E FORM OP' ASSESSMENT AGREEMENT and ASSESSOR'S CERTIFICATION By and among TFIE COTTAGE GROVE ECONOMIC DEVELOPMENT AUTHORITY and VVERNER ELECTRIC, MINNESOTA and ASSESSOR FOR «ASFiINGTON COtil�'TY, MINNESOTA This Doctunent was drafted by: KENNEDY & GRAVEN, Chartered 470 Pillsbury Center Minneapolis, Minnesota 55402 (612) 337-9300 E-1 THIS ASSESSMENT AGREEMENT, dated as of this day of , 2007, by and between the Cottage GZ �conomic Development Authozity, a public body cotiporate and �olitic (the "Authorit}�') and Werner ElecYric, Mimiesota, a Minnesota corporation (fl1e "Developer"). WITNESSETH: WHEREAS, on or before the date hereof, the Authority and the Developer have entered into a Contract for Private Development (the "Development Agreement") pursuani to which the Authority will convey to the Developer certain real property in Washington County, Minnesota, which property is legally described on E�ibit A hereto, (the "Property"); and WHEREAS, pursuant to the Development Agreement, the Developer wiil eonshuct �a inanufacturin� � facility containiug a}�pro�nately 122,000 square feet (the "Minimum Improvements"} on the Properiy; and WHEREAS, the Authority and Developer desire to establish a minimum market value for the Property and the Minimum Improvements to be conshucted thereon, pursuant to Minnesota Statutes, section 469.177, Subd. 8; and WHEREAS, the Authority and the Assessor for Washington County, Minnesota have reviewed the plans and specifications for the Minimum Improvements which the Developer has agreed to construct or cause to be conshucted on the Property pursuant to the Development Agreement. NOW, THEREFORE, the parties to this Assessment Agreement, in consideration of the promises, eovenants and agreeinents made herein and in the DeveloprnenY Agreement by each to the other, do hereby ag�ee as follows: � L The Minimum Market Value for the Property with the Minimum Iinproveinents sha11 be $6,600,000. The parties agree that this Minimum Market Value shall be placed against the Properiy as of January 2, 2009, for taxes payable beginning in 2010, notwithstanding any failure to com�lete construction of such Minumm� Improvements by that date. 2. The Minimum Market Value herein established sha11 be of no further force and efFeet and this Assessment Agreement shall Cerminate on the TerminaYion Date. The Terniination Date wi11 occur when the Authority's TIF District No. 1-14 is decertified, which is expected Yo be nine years after receipt by the Authority of the first taY increment or 11 years after approval of the TIF Plan, whichever occm�s first. 3. This Assessment Ab e�ment shall be pronlptly i by the Developer with a copy of Minnesota Statutes, secYion 469.177, Subd. 8, set forth in Exlubit B hereCo. The Developer sha11 pay all costs of recording this Assessmeilt Agreement. 4. Neither the preambles nor the provisions of this Asscssment Ageement are intendecl to, nor shall they be eonsirued as, modifying dze terms of flie Development Agreement. Unless the E-2 context indicates clearly to flie conh•ary, the tenns used in this Assessment Agreement sha11 have the same meaning as the terms used in the Development Agreement. 5. This Assessment Agreeillent shall inure Yo the benefit of and be binding upon the successors and assigns of the parties. 6. Each of the parties warrants and represents that it has authoiity to enter into this Assessment Agreement and to take all aotions required of it and has taken all actions necessary to authorize the execution and delive�y of fliis Assessment Agreement. 7. In the event that any provision of this Assessment Agreement is held invalid or unenfarceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any oflier provision hereof. 8. The parties hereto agree that they wili, from time to time, execute, aclrnowledge and deliver, or cause to be executed, acknowledged and delivered, such supplements, amendments and modifications hereto, and such further instruments as may reasonably be required for correcring any inadequate, or inconect, or amended description of the Property, or for carrying out the expressed intenYion of this Assessment Agreement. 9. Except as provided in Section 8 he��eof, this Assessment Agreement may not be amended nor any of its terms modified except by a wiiting authorized and executed by all parties hereto. 10. This Assessment Agreement may be simultaneously exeeuted in several counterparts, each of which shall be an oiiginal and all of which shall consfitute one and the same instrument. 11. This Assessment Agreement shall be governed by and construed in accordance with the laws of Minnesota. ��*��*��:��:��:�*��:** E-3 COTTAGE GROVE ECONOMIC DEVELOPMENT AUTHORITY By Its President B Its Executive Director STATE OF MINNESOTA ) ) SS COUNTY OF ) The fore�oing instrument as acknowledged before me this day of , 2007, by and , president and executive director, respectively, of the Cottage Grove Economic Development Authority, a public body corporate and politic under the laws of Minnesota, on belialf of the Economic Development Authority. Notary Public E-4 WERNER ELECTRIC, MINNESOTA : STATE OP MINivTESOTA ) } ss COUNTY OF ) Its The foregoing instrument was executed this day of , 2007, by , the of Werner Elechic, Minnesota, a Minnesota cotporation, on behalf of the corporation. Notary PuUlic E-5 CERTIFICATION BY ASSESSOR The iusdersigned, having reviewed the plans and specifications far the improvements to be constt and the market value assigned to the land upon which the improveinents are to be consh and being of the opinion that the nlininlum market value contained in the foregoing Assessment Agreement appears reasonable, hereby certifies as follows: The undersigned Assessor, being legally responsible for the assessment of the described property as Washington County Assessor, hereby certifies that the market value assigned to such land and improvements beginning on Januaiy 1, 2009, for taxes payable beginning in 2010 sha11 be not less fllan �6,600,000 until tenninarion of fhis Agreement. � Assessor for Washington County, Minnesota STATE OF M�TNESOTA ) ) ss COU1_VTY OF ) The foregoing instrument was acknowledged before me fliis day of _ 2007 by , the Assessor for Washington County, Minnesota. Notaay Public E-6 EXHIBIT A TO ASSESSMENT AGREEMENT The Property is Iegally described as follows: [to be completed] E-7 EXHIBIT B TO ASSESSMENT AGREEMENT Section 469.177, subd. 8. Assessment Agreements. An authority may enter into a writfen assessment agreement with any person establishing a minimum market value of land, existing improvements, or improvements to be constructed in a dishict, if the property is owned or wi11 be owned by the person. The minimum market value established by an assessment agreement may be fixed, or inerease or decrease in later years from the initial minimum market value. If an agreement is fully executed before July 1 of an assessment year, the market value as provided under the agreement mu'st be used by the county or local assessor as the taxable market value of the property for fliat assessment. Agreements executed on or after July 1 of an assessment year beeome effecrive for assessment purposes in the following assessment year. An assessment agreement terminates on the earliest of the date on which conditions in the assessment agreemen2 far termination az�e safisfied, the termination date specified in the agreement, or the date when ta� increment is no longer paid to the autholity under section 469176, subdivision 1. The assessment agreemeiit shall be presented to the county assessor, or city assessor baving fhe powers of the county assessor, of the jurisdiction in which the tax increment financing district and the property that is the subject of the agreement is located. The assessor shall review the plans and specifications for the improvements to be constructed, review the market value previously assigned to the land upon which the improvements are to be constructed and, so lon� as the minimum market value eontained in the assessment agseement appears, in the judgment of the assessor, to be a reasonable estimate, sha11 execute the following certification upon the ageement: The undersigned assessor, being legally responsible for Yhe assessment of the above described property, certifies that the market values assigned to the land a�id improvements are reasonable. The assessment agreement shall be filed for record and recordcd in the office of the eounty recorder or the registrar of titles of each county where the real estate or any parC thereof is situated. After the agreement becomes effective far assessment purposes, the assessor shall value the property under section 273.11, except that the market value assigned sha11 not be less than the minimum market value established by the assessment agreement. The assessor may assign a market value to the property in exeess of the minimum markeC value established by the assessment agreement. The owner of the property nlay seek, through the exercise of adminishative and legal remedies, a reduction in market value for property Yaac purposes, but no city assessor, county assessor, county auditor, Uoard of review, board of equalization, commissioner of revenue, or court of this state shall grant a redue'tion of the market value below the minimum market value established by the assessment agreement dm the term of the agreement filed of record re�ardless of actual market values wkich may result frorri incomplete construction of improvements, destruction; or diminution by any cause, insured or uninsured, except in the case of acquisition or reacquisition of the property by a public entity. Recording an assessment agreement consYitutes notice of the agreement to anyone who aequires a�ly interest in the land or improvements thaf is subjeet Yo the assessment agreement, and the agreement is binding upon them. �-8 r�.v�:��e3r�a DRAFT OF PRELIMINARY PLAT OF [TO BE ATTACHED] P-1