Public Hearing Draft - TIF Dev Agreement8350533v3
DEVELOPMENT AGREEMENT
BY AND BETWEEN
THE CITY OF OTSEGO, MINNESOTA
AND
RIVERVIEW LANDING, INC.
This document drafted by: BRIGGS AND MORGAN
Professional Association
2200 IDS Center
80 South 8th Street
Minneapolis, Minnesota 55402
8350533v3
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS ................................................................................................. 2
Section 1.1 Definitions............................................................................................ 2
ARTICLE II REPRESENTATIONS AND WARRANTIES................................................ 4
Section 2.1 Representations and Warranties of the City ......................................... 4
Section 2.2 Representations and Warranties of the Developer ............................... 4
ARTICLE III UNDERTAKINGS BY DEVELOPER AND CITY ....................................... 6
Section 3.1 Site Improvements and Legal and Administrative Expenses .............. 6
Section 3.2 Limitations on Undertaking of the City ............................................... 6
Section 3.3 Reimbursement: TIF Note ................................................................... 6
Section 3.4 Compliance with Low and Moderate Income Requirements .............. 7
ARTICLE IV EVENTS OF DEFAULT ................................................................................. 8
Section 4.1 Events of Default Defined ................................................................... 8
Section 4.2 Remedies on Default ............................................................................ 8
Section 4.3 No Remedy Exclusive.......................................................................... 9
Section 4.4 No Implied Waiver .............................................................................. 9
Section 4.5 Agreement to Pay Attorney's Fees and Expenses ................................ 9
Section 4.6 Indemnification of City ........................................................................ 9
ARTICLE V DEVELOPER'S OPTION TO TERMINATE AGREEMENT ..................... 11
Section 5.1 The Developer's Option to Terminate ................................................ 11
Section 5.2 Action to Terminate ........................................................................... 11
Section 5.3 Effect of Termination ......................................................................... 11
ARTICLE VI ADDITIONAL PROVISIONS ...................................................................... 12
Section 6.1 Restrictions on Use ............................................................................ 12
Section 6.2 Conflicts of Interest............................................................................ 12
Section 6.3 Titles of Articles and Sections ........................................................... 12
Section 6.4 Notices and Demands ........................................................................ 12
Section 6.5 Counterparts ....................................................................................... 13
Section 6.6 Law Governing .................................................................................. 13
Section 6.7 Expiration ........................................................................................... 13
Section 6.8 Provisions Surviving Rescission or Expiration.................................. 13
Section 6.9 Assignability of Agreement ............................................................... 13
Section 6.10 Transfer of Project ............................................................................. 13
EXHIBIT A DESCRIPTION OF DEVELOPMENT PROPERTY .......................................... A-1
EXHIBIT B FORM OF TIF NOTE ........................................................................................... B-1
EXHIBIT C SITE IMPROVEMENTS ...................................................................................... C-1
EXHIBIT D COMPLIANCE CERTIFICATE .......................................................................... D-1
8350533v3
DEVELOPMENT AGREEMENT
THIS AGREEMENT, made as of the 17th day of July, 2017, by and between the City of
Otsego, Minnesota (the "City"), a municipal corporation existing under the laws of the State of
Minnesota and Riverview Landing, Inc., a Minnesota nonprofit corporation (the "Developer"),
WITNESSETH:
WHEREAS, pursuant to Minnesota Statutes, Section 469.124 to 469.133, the City has
heretofore established Development District No. 1 (the "Development District") and has adopted
a development program therefor (the "Development Program"); and
WHEREAS, pursuant to the provisions of Minnesota Statutes, Section 469.174 through
469.1794, as amended (hereinafter, the "Tax Increment Act"), the City has heretofore
established, within the Development District, Tax Increment Financing District No. 3 -
Riverview Landing (the "Tax Increment District") and has adopted a tax increment financing
plan therefor (the "Tax Increment Plan") which provides for the use of tax increment financing in
connection with certain development within the Development District; and
WHEREAS, in order to achieve the objectives of the Development Program and
particularly to make the land in the Development District available for development by private
enterprise in conformance with the Development Program, the City has determined to assist the
Developer with the financing of certain costs of a Project (as hereinafter defined) to be
constructed within the Tax Increment District as more particularly set forth in this Agreement;
and
WHEREAS, the City believes that the development and construction of the Project, and
fulfillment of this Agreement are vital and are in the best interests of the City, the health, safety,
morals and welfare of residents of the City, and in accordance with the public purpose and
provisions of the applicable state and local laws and requirements under which the Project has
been undertaken and is being assisted. And
WHEREAS, the requirements of the Business Subsidy Law, Minnesota Statutes, Section
116J.993 through 116J.995, do not apply to this Agreement pursuant to an exemption for
housing.
NOW, THEREFORE, in consideration of the premises and the mutual obligations of the
parties hereto, each of them does hereby covenant and agree with the other as follows:
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ARTICLE I
DEFINITIONS
Section 1.1 Definitions. All capitalized terms used and not otherwise defined herein
shall have the following meanings unless a different meaning clearly appears from the context:
Agreement means this Agreement, as the same may be from time to time modified,
amended or supplemented;
Business Day means any day except a Saturday, Sunday or a legal hol iday or a day on
which banking institutions in the City are authorized by law or executive order to close;
City means the City of Otsego, Minnesota;
Compliance Certificate means the Compliance Certificate in substantially the form
attached hereto as Exhibit D;
County means Wright County, Minnesota;
Developer means Riverview Landing, Inc., its successors and assigns;
Development District means Development District No. 1, including the real property
described in the Development Program;
Development Program means the development program approved in connection with the
Development District;
Development Property means the real property described in Exhibit A attached to this
Agreement;
Event of Default means any of the events described in Section 4.1 hereof;
Land Use Agreement means the Development Agreement for Guardian Angels
Riverview Landing dated as of July 17, 2017 by and between the City and the Developer.
Legal and Administrative Expenses means the fees and expenses incurred by the City in
connection with the establishment of the Tax Increment District and the preparation of this
Agreement;
Note Payment Date means August 1, 2020, and each February 1 of each year thereafter to
and including February 1, 2046; provided, that if any such Note Payment Date sh ould not be a
Business Day, the Note Payment Date shall be the next succeeding Business Day;
Prime Rate means the rate of interest from time to time publicly announced by U.S. Bank
National Association in St. Paul, Minnesota, as its "reference rate" or any successor rate, which
rate shall change as and when that prime rate or successor rate changes;
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Project means the construction of a 142-unit senior housing facility by the Developer on
the Development Property;
Site Improvements means the site improvements undertaken or to be undertaken on the
Development Property, more particularly described on Exhibit C attached hereto;
State means the State of Minnesota;
Tax Increments means 90% of the tax increments derived from the Development
Property which have been received and retained by the City in accordance with the provisions of
Minnesota Statutes, Section 469.177;
Tax Increment Act means Minnesota Statutes, Sections 469.174 through 469.1794, as
amended;
Tax Increment District means Tax Increment Financing District No. 3 - Riverview
Landing located within the Development District, a description of which is set forth in the Tax
Increment Financing Plan, which was qualified as a housing district under the Tax Increment
Act;
Tax Increment Financing Plan means the tax increment financing plan approved for the
Tax Increment District by the City Council on July 17, 2017, and any future amendments
thereto;
TIF Note means the Tax Increment Revenue Note (Guardian Angels Project) to be
executed by the City and delivered to the Developer pursuant to Article III hereof, a form of
which is attached hereto as Exhibit B.
Unavoidable Delays means delays, outside the control of the party claiming its
occurrence, which are the direct result of strikes, other labor troubles, unusually severe or
prolonged bad weather, acts of God, fire or other casualty to the Project, litigation commenced
by third parties which, by injunction or other similar judicial action or by the exercise of
reasonable discretion, directly results in delays, or acts of any federal, state or local
governmental unit (other than the City) which directly result in delays.
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ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations and Warranties of the City. The City makes the following
representations and warranties:
(1) The City is a municipal corporation and has the power to enter into this
Agreement and carry out its obligations hereunder.
(2) The Tax Increment District is a "housing district" within the meaning of
Minnesota Statutes, Section 469.174, Subdivision 11, and was created, adopted and approved in
accordance with the terms of the Tax Increment Act.
(3) The development contemplated by this Agreement is in conformance with the
development objectives set forth in the Development Program.
(4) To finance certain costs within the Tax Increment District, the City proposes,
subject to the further provisions of this Agreement, to apply Tax Increments to reimburse the
Developer for a portion of the costs of the construction of Site Improvements incurred in
connection with the Project as further provided in this Agreement.
(5) The City makes no representation or warranty, either expressed or implied, as to
the Development Property or its condition or the soil conditions thereon, or that the Development
Property shall be suitable for the Developer's purposes or needs.
Section 2.2 Representations and Warranties of the Developer. The Developer makes
the following representations and warranties:
(1) The Developer is a nonprofit corporation and has the power and authority to enter
into this Agreement and to perform its obligations hereunder, and doing so will not violate its
articles of organization, bylaws, or the laws of the State and by proper action has authorized the
execution and delivery of this Agreement.
(2) The Developer shall cause the Project to be constructed in accordance with the
terms of this Agreement, the Development Program, the Land Use Agreement, and all local, state
and federal laws and regulations (including, but not limited to, environmental, zoning, energy
conservation, building code and public health laws and regulations).
(3) The construction of the Project would not be undertaken by the Developer, and in
the opinion of the Developer would not have been or be economically feasible within the
reasonably foreseeable future, without the assistance and benefit to the Developer provided for in
this Agreement.
(4) The Developer will use its best efforts to obtain, or cause to be obtained, in a
timely manner, all required permits, licenses and approvals, and will meet, in a time ly manner,
all requirements of all applicable local, state, and federal laws and regulations which must be
obtained or met before the balance of the Project may be lawfully constructed.
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(5) Neither the execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby, nor the fulfillment of or compliance with the terms and
conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of,
the terms, conditions or provision of any contractual restriction, evidence of indebtedness,
agreement or instrument of whatever nature to which the Developer is now a party or by which it
is bound, or constitutes a default under any of the foregoing.
(6) The Developer will cooperate fully with the City with respect to any litigation
commenced with respect to the Project.
(7) The Developer will cooperate fully with the City in resolution of any traffic,
parking, trash removal or public safety problems which may arise in connection with the
construction and operation of the Project.
(8) The construction of the Project shall commence no later than October 12, 2017
and barring Unavoidable Delays, the Project will be substantially completed by December 31,
2018.
(9) The Developer acknowledges that Tax Increment projections contained in the Tax
Increment Financing Plan are estimates only and the Developer acknowledges that it shall place
no reliance on the amount of projected Tax Increments and the sufficiency of such Tax
Increments to reimburse the Developer for a portion of the costs of the Site Improvements as
provided in Article III.
(10) The Developer will not seek a reduction in the market value as determined by the
County Assessor of the Project or other facilities, if any, that it constructs on the Development
Property, pursuant to the provisions of this Agreement, for so long as the TIF Note remains
outstanding.
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ARTICLE III
UNDERTAKINGS BY DEVELOPER AND CITY
Section 3.1 Site Improvements and Legal and Administrative Expenses.
(1) The parties agree that the Site Improvements to be constructed by the Developer
are essential to the successful completion of the Project. The costs of the construction of the Site
Improvements shall be paid by the Developer. The City shall reimburse the Developer for the
lesser of $2,389,400 of the costs of the Site Improvements a ctually incurred and paid by the
Developer (the "Reimbursement Amount") as further provided in Section 3.3 hereof.
(2) The Developer shall pay all Legal and Administrative Expenses within 15 days of
the City's submission of the Legal and Administrative Expenses to the Developer.
Section 3.2 Limitations on Undertaking of the City. Notwithstanding the provisions
of Section 3.1, the City shall have no obligation to the Developer under this Agreement to
reimburse the Developer for the Reimbursement Amount, if the City, at the time or times such
payment is to be made is entitled under Section 4.2 to exercise any of the remedies set forth
therein as a result of an Event of Default which has not been cured.
Section 3.3 Reimbursement: TIF Note. The City shall reimburse the costs identified
in Section 3.1 through the issuance of the City's TIF Note in substantially the form attached to
this Agreement as Exhibit B, subject to the following conditions:
(1) The TIF Note shall be dated, issued and delivered when the Developer shall have
demonstrated in writing to the reasonable satisfaction of the City that the construction of the Site
Improvements has been completed and that the Developer has incurred and paid all costs of the
construction of Site Improvements, as described in and limited by Section 3.1 and shall have
submitted paid invoices for the costs of construction of the Site Improvements in an amount not
less than the Reimbursement Amount.
(2) The principal amount of the TIF Note shall be payable solely from the Tax
Increments.
(3) On each Note Payment Date and subject to the provisions of the TIF Note, the
City shall pay, against the principal outstanding on the TIF Note, the Tax Increments received by
the City during the preceding twelve months. All such payments shall be applied to reduce the
principal of the TIF Note.
(4) The TIF Note shall be a special and limited obligation of the City and not a
general obligation of the City, and only Tax Increments shall be used to pay the principal of the
TIF Note.
(5) The City's obligation to make payments on the TIF Note on any Note Payment
Date or any date thereafter shall be conditioned upon the requirement that there shall not at that
time be an Event of Default that has occurred and is continuing under this Agreement.
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(6) The TIF Note shall be governed by and payable pursuant to the additional terms
thereof, as set forth in Exhibit B. In the event of any conflict between the terms of the TIF Note
and the terms of this Section 3.3, the terms of the TIF Note shall govern. The issuance of the
TIF Note pursuant and subject to the terms of this Agreement, and the taking by the City of such
additional actions as bond counsel for the TIF Note may require in connection therewith, are
hereby authorized and approved by the City.
Section 3.4 Compliance with Low and Moderate Income Requirements.
(1) The City and the Developer understand and agree that the Tax Increment District
will constitute a "housing district" under Section 469.174, Subd. 11 of the Tax Increment Act.
Accordingly, in compliance with Section 469.1761, Subd. 3 of the Tax Increment Act, the
Developer agrees that the Project must satisfy, or be treated as satisfying, the income
requirements for a qualified residential rental project as defined in Section 142(d) of the Internal
Revenue Code. The parties further agree that no more than 20% of the square footage of the
Project may consist of commercial, retail, or other nonresidential uses. The Developer must
meet the above requirements as follows:
(A) At least 20% of the residential units in the Project must be occupied or
available for occupancy by persons whose incomes do not exceed 50% of the County
median income; and
(B) The limits described in clause (A) must be satisfied through the
Termination Date. Income for occupants of units described in clause (A) shall be
adjusted for family size in accordance with Section 142(d) of the Internal Revenue Code
and related regulations.
(2) On or before each January 1 and July 1, commencing on July 1, 2020, the
Developer or an agent of the Developer must deliver or cause to be delivered to the City a
Compliance Certificate executed by the Developer covering the preceding six months together
with written evidence satisfactory to the City of compliance with the covenants in this Section.
This evidence must include a statement of the household income of each qualifying renter, a
written determination that each qualifying renter's household income falls within the qualifying
limits of this Section (and Section 142(d) of the Internal Revenue Code), and certification that
the income documentation is correct and accurate (and that the determination of qualification
was made in compliance with Section 142(d) of the Internal Revenue Code). The City may
review, upon request, all documentation supporting the Developer submissions and statements.
In determining compliance with this Section, the Developer must use the County median
incomes for the year in which the payment is due on the TIF Note, as promulgated by the
Minnesota Housing Finance Agency based on the area median incomes established by the United
States Department of Housing and Urban Development.
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ARTICLE IV
EVENTS OF DEFAULT
Section 4.1 Events of Default Defined. The following shall be "Events of Default"
under this Agreement and the term "Event of Default" shall mean whenever it is used in this
Agreement any one or more of the following events:
(1) Failure by the Developer to timely pay any ad valorem real property taxes
assessed, special assessments or other City charges with respect to the Development Property
when due and payable.
(2) Failure by the Developer to cause the construction of the Project to be completed
pursuant to the terms, conditions and limitations of this Agreement.
(3) Failure of the Developer to observe or perform any other covenant, condition,
obligation or agreement on its part to be observed or performed under this Agreement and the
Land Use Agreement.
(4) The holder of any mortgage on the Development Property or any improvements
thereon, or any portion thereof, commences foreclosure proceedings as a result of any default
under the applicable mortgage documents.
(5) If the Developer shall:
(A) file any petition in bankruptcy or for any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under the United
States Bankruptcy Act of 1978, as amended or under any similar federal or state law; or
(B) make an assignment for the benefit of its creditors; or
(C) admit in writing its inability to pay its debts generally as they become due;
or
(D) be adjudicated as bankrupt or insolvent; or if a petition or answer
proposing the adjudication of the Developer as bankrupt or its reorganization under any
present or future federal bankruptcy act or any similar federal or state law shall be filed in
any court and such petition or answer shall not be discharged or denied within sixty (60)
days after the filing thereof; or a receiver, trustee or liquidator of the Developer, or of the
Project, or part thereof, shall be appointed in any proceeding brought against the
Developer, and shall not be discharged within sixty (60) days after such appointment, or
if the Developer, shall consent to or acquiesce in such appointment.
Section 4.2 Remedies on Default. Whenever any Event of Default referred to in
Section 4.1 occurs and is continuing, the City, as specified below, may take any one or more of
the following actions after the giving of thirty (30) days' written notice to the Developer, but only
if the Event of Default has not been cured within said thirty (30) days:
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(1) The City may suspend its performance under this Agreement and the TIF Note
until it receives assurances from the Developer, deemed adequate by the City, that the Developer
will cure its default and continue its performance under this Agreement.
(2) The City may cancel and rescind the Agreement and the TIF Note.
(3) The City may take any action, including legal or administ rative action, in law or
equity, which may appear necessary or desirable to enforce performance and observance of any
obligation, agreement, or covenant of the Developer under this Agreement.
Section 4.3 No Remedy Exclusive. No remedy herein conferred upon or reserved to
the City is intended to be exclusive of any other available remedy or remedies, but each and
every such remedy shall be cumulative and shall be in addition to every other remedy given
under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or
omission to exercise any right or power accruing upon any default shall impair any such right or
power or shall be construed to be a waiver thereof, but any such right and power may be
exercised from time to time and as often as may be deemed expedient.
Section 4.4 No Implied Waiver. In the event any agreement contained in this
Agreement should be breached by any party and thereafter waived by any other party, such
waiver shall be limited to the particular breach so waived and shall not be deemed to waive any
other concurrent, previous or subsequent breach hereunder.
Section 4.5 Agreement to Pay Attorney's Fees and Expenses. Whenever any Event of
Default occurs and the City shall employ attorneys or incur other expenses for the collection of
payments due or to become due or for the enforcement or performance or observance of any
obligation or agreement on the part of the Developer herein contained, the Developer agrees that
it shall, on demand therefor, pay to the City the reasonable fees of such attorneys and such other
expenses so incurred by the City.
Section 4.6 Indemnification of City.
(1) The Developer releases from and covenants and agrees that the City, its governing
body members, officers, agents, including the independent contractors, consultants and legal
counsel, servants and employees thereof (hereinafter, for purposes of this Section, collectively
the "Indemnified Parties") shall not be liable for and agrees to indemnify and hold harmless the
Indemnified Parties against any loss or damage to property or any injury to or death of any
person occurring at or about or resulting from any defect in the Project, provided that the
foregoing indemnification shall not be effective for any actions of the Indemnified Parties that
are not contemplated by this Agreement.
(2) Except for any willful misrepresentation or any willful or wanton misconduct of
the Indemnified Parties, the Developer agrees to protect and defend the Indemnified Parties, now
and forever, and further agrees to hold the aforesaid harmless from any claim, demand, suit,
action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly
arising from the actions or inactions of the Developer (or other persons acting on its behalf or
under its direction or control) under this Agreement, or the transactions contemplated hereby or
the acquisition, construction, installation, ownership, and operation of the Project; provided, that
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this indemnification shall not apply to the warranties made or obligations undertaken by the City
in this Agreement or to any actions undertaken by the City which are not contemplated by this
Agreement but shall, in any event and without regard to any fault on the part of the City, apply to
any pecuniary loss or penalty (including interest thereon from the date the loss is incurred or
penalty is paid by the City at a rate equal to the Prime Rate) as a result of the Developer
operating the Project so that the Tax Increment District does not qualify or ceases to qualify as a
"housing district" under Section 469.174, Subdivision 11, of the Act or to violate limitations as
to the use of Tax Increments as set forth in Section 469.176, Subdivision 4d.
(3) All covenants, stipulations, promises, agreements and obligations of the City
contained herein shall be deemed to be the covenants, stipulations, promises, agreements and
obligations of the City and not of any governing body member, officer, agent, servant or
employee of the City.
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ARTICLE V
DEVELOPER'S OPTION TO TERMINATE AGREEMENT
Section 5.1 The Developer's Option to Terminate. This Agreement may be terminated
by Developer, if (i) the Developer is in compliance with all material terms of this Agreement and
no Event of Default has occurred; and (ii) the City fails to comply with any material term of this
Agreement, and, after written notice by the Developer of such failure, the City has failed to cure
such noncompliance within ninety (90) days of receipt of such notice, or, if such noncompliance
cannot reasonably be cured by the City within ninety (90) days, of receipt of such notice, the
City has not provided assurances, reasonably satisfactory to the Developer, that such
noncompliance will be cured as soon as reasonably possible.
Section 5.2 Action to Terminate. Termination of this Agreement pursuant to Section
5.1 must be accomplished by written notification by the Developer to the City within sixty (60)
days after the date when such option to terminate may first be exercised. A failure by the
Developer to terminate this Agreement within such period constitutes a waiver by the Developer
of its rights to terminate this Agreement due to such occurrence or event.
Section 5.3 Effect of Termination. If this Agreement is terminated pursuant to this
Article V, this Agreement shall be from such date forward null and void and of no further effect;
provided, however, the termination of this Agreement shall not affect the rights of either party to
institute any action, claim or demand for damages suffered as a result of breach or default of the
terms of this Agreement by the other party, or to recover amounts which had accrued and
become due and payable as of the date of such termination. Upon termination of this Agreement
pursuant to this Article V, the Developer shall be free to proceed with the Project at its own
expense and without regard to the provisions of this Agreement; provided, however, that the City
shall have no further obligations to the Developer with respect to reimbursement of the expenses
set forth in Section 3.2, or to make any further payments on the TIF Note.
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ARTICLE VI
ADDITIONAL PROVISIONS
Section 6.1 Restrictions on Use. The Developer agrees for itself, its successors and
assigns and every successor in interest to the Development Property, or any part thereof, that
during the term of this Agreement the Developer and such successors and assigns shall operate,
or cause to be operated, the Project as a senior housing facility and shall devote the Development
Property to, and in accordance with, the uses specified in this Agreement.
Section 6.2 Conflicts of Interest. No member of the governing body or other official
of the City shall have any financial interest, direct or indirect, in this Agreement, the
Development Property or the Project, or any contract, agreement or other transaction
contemplated to occur or be undertaken thereunder or with respect thereto, nor shall any such
member of the governing body or other official participate in any decision relating to the
Agreement which affects his or her personal interests or the interests of any corporation,
partnership or association in which he or she is directly or indirectly interested. No member,
official or employee of the City shall be personally liable to the City in the event of any default
or breach by the Developer or successor or on any obligations under the terms of this Agreement.
Section 6.3 Titles of Articles and Sections. Any titles of the several parts, articles and
sections of the Agreement are inserted for convenience of reference only and shall be
disregarded in construing or interpreting any of its provisions.
Section 6.4 Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand or other communication under this Agreement by any party to any
other shall be sufficiently given or delivered if it is dispatched by registered or certified mail,
postage prepaid, return receipt requested, or delivered personally, and
(1) in the case of the Developer is addressed to or delivered personally to:
Riverview Landing, Inc.
508 Freeport Avenue NW, Suite A
Elk River, MN 55330
Attention: Chief Executive Officer
(2) in the case of the City is addressed to or delivered personally to the City at:
City of Otsego, Minnesota
Attention: City Administrator/Finance Director
13400 90th Street NE
Otsego, MN 55330
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with a copy to:
Briggs and Morgan, P.A.
Attention: Mary Ippel
2200 IDS Center
80 South 8th Street
Minneapolis, MN 55402
or at such other address with respect to any such party as that party may, from time to time,
designate in writing and forward to the other, as provided in this Section.
Section 6.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall constitute one and the same instrument.
Section 6.6 Law Governing. This Agreement will be governed and construed in
accordance with the laws of the State.
Section 6.7 Expiration. This Agreement shall expire on the earlier of (i) February 1,
2046, (ii) the date the TIF Note is paid in full or (iii) the date this Agreement is terminated or
rescinded in accordance with its terms.
Section 6.8 Provisions Surviving Rescission or Expiration. Sections 4.5 and 4.6 shall
survive any rescission, termination or expiration of this Agreement with respect to or arising out
of any event, occurrence or circumstance existing prior to the date thereof.
Section 6.9 Assignability of Agreement. This Agreement may be assigned only with
the consent of the City. The TIF Note may only be assigned pursuant to the terms of the TIF
Note.
Section 6.10 Transfer of Project. If the Developer sells or transfers the Project, this
Agreement shall terminate unless the prior written consent of the City is obtained and the
transferee shall have demonstrated the continued need for assistance.
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IN WITNESS WHEREOF, the City has caused this Agreement to be duly executed in its
name and on its behalf and its seal to be hereunto duly affixed, and the Developer has caused this
Agreement to be duly executed on its behalf, on or as of the date first above written.
CITY OF OTSEGO, MINNESOTA
By____________________________
Its Mayor
By____________________________
Its City Administrator/Finance Director
This is a signature page to the Development Agreement by and between the City of Otsego and
Riverview Landing, Inc.
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RIVERVIEW LANDING, INC.
By____________________________
Its
This is a signature page to the Development Agreement by and between the City of Otsego and
Riverview Landing, Inc.
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A-1
EXHIBIT A
DESCRIPTION OF DEVELOPMENT PROPERTY
Lot 1, Block 1
Guardian Angels Riverview Landing
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B-1
EXHIBIT B
FORM OF TIF NOTE
No. R-1 $2,389,400
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF WRIGHT
CITY OF OTSEGO
TAX INCREMENT REVENUE NOTE
(GUARDIAN ANGELS PROJECT)
The City of Otsego, Minnesota (the "City"), hereby acknowledges itself to be indebted
and, for value received, hereby promises to pay the amounts hereinafter described (the "Payment
Amounts") to Riverview Landing, Inc., or its registered assigns (the "Registered Owner"), but
only in the manner, at the times, from the sources of revenue, and to the extent hereinafter
provided.
The principal amount of this Note shall equal from time to time the principal amount
stated above, as reduced to the extent that such principal installments shall have been paid in
whole or in part pursuant to the terms hereof; provided that the sum of the principal amount
listed above shall in no event exceed $2,389,400 as provided in that certain Development
Agreement, dated as of July 1, 2017, as the same may be amended from time to time (the
"Development Agreement"), by and between the City and the Developer. This Note bears no
interest.
The amounts due under this Note shall be payable on August 1, 2020, and on each
February 1 thereafter to and including February 1, 2046, or, if the first should not be a Business
Day (as defined in the Development Agreement) the next succeeding Business Day (the
"Payment Dates"). On each Payment Date the City shall pay by check or draft mailed to the
person that was the Registered Owner of this Note at the close of the last business day of the City
preceding such Payment Date an amount equal to the Tax Increments (hereinafter defined)
received by the City during the twelve month period preceding such Payment Date. All
payments made by the Authority under this Note shall first be applied to accrued interest and
then to principal. This Note is prepayable by the Authority, in whole or in part, on any date.
The Payment Amounts due hereon shall be payable solely from 90% of the tax
increments (the "Tax Increments") from the Development Property (as defined in the
Development Agreement) within the City's Tax Increment Financing District No. 3 - Riverview
Landing (the "Tax Increment District") within its Development District No. 1 which are paid to
the City and which the City is entitled to retain pursuant to the provisions of Minnesota Statutes,
Sections 469.174 through 469.1794, as the same may be amended or supplemented from time to
time (the "Tax Increment Act"). This Note shall terminate and be of no further force and effect
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following the termination of the Tax Increment District, on any date upon which the City shall
have terminated the Development Agreement under Section 4.2(2) thereof or the Developer shall
have terminated the Development Agreement under Article V thereof, or on the date that all
principal and interest payable hereunder shall have been paid in full, whichever occurs earliest.
The City makes no representation or covenant, expressed or implied, that the Tax
Increments will be sufficient to pay, in whole or in part, the amounts which are or may become
due and payable hereunder.
The City's payment obligations hereunder shall be further conditioned on the fact that no
Event of Default under the Development Agreement shall have occurred and be continuing at the
time payment is otherwise due hereunder, but such unpaid amounts shall become payable if said
Event of Default shall thereafter have been cured; and, further, if pursuant to the occurrence of
an Event of Default under the Development Agreement the City elects to cancel and rescind the
Development Agreement, the City shall have no further debt or obligation under this Note
whatsoever. Reference is hereby made to all of the provisions of the Development Agreement,
including without limitation Section 3.3 thereof, for a fuller statement of the rights and
obligations of the City to pay the principal of this Note, and said provisions are hereby
incorporated into this Note as though set out in full herein.
This Note is a special, limited revenue obligation and not a general obligation of the City
and is payable by the City only from the sources and subject to the qualifications stated or
referenced herein. This Note is not a general obligation of the City of Otsego, Minnesota, and
neither the full faith and credit nor the taxing powers of the City are pledged to the payment of
the principal of this Note and no property or other asset of the City, save and except the above-
referenced Tax Increments, is or shall be a source of payment of the City's obligations hereunder.
This Note is issued by the City in aid of financing a project pursuant to and in full
conformity with the Constitution and laws of the State of Minnesota, including the Tax
Increment Act.
This Note may be assigned only with the consent of the City. In order to assign the Note,
the assignee shall surrender the same to the City either in exchange for a new fully registered
note or for transfer of this Note on the registration records for the Note maintained by the City.
Each permitted assignee shall take this Note subject to the foregoing conditions and subject to all
provisions stated or referenced herein.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things
required by the Constitution and laws of the State of Minnesota to be done, to have happened,
and to be performed precedent to and in the issuance of this Note have been done, have
happened, and have been performed in regular and due form, time, and manner as required by
law; and that this Note, together with all other indebtedness of the City outstanding on the date
hereof and on the date of its actual issuance and delivery, does not cause the indebtedness of the
City to exceed any constitutional, statutory or charter limitation thereon.
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IN WITNESS WHEREOF, City of Otsego, Minnesota, by its City Council, has caused
this Note to be executed by the manual signatures of its Mayor and City Administrator/Finance
Director and has caused this Note to be issued on and dated _______________, 20__.
________________________ ________________________
City Administrator/Finance Director Mayor
DO NOT EXECUTE UNTIL PAID INVOICES FOR SITE IMPROVEMENTS ARE
GIVEN TO THE CITY - REFER TO SECTION 3.3(1).
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CERTIFICATION OF REGISTRATION
It is hereby certified that the foregoing Note, as originally issued on _______________,
20__, was on said date registered in the name of ___________________________, and that, at
the request of the Registered Owner of this Note, the undersigned has this day registered the
Note in the name of such Registered Owner, as indicated in the registration blank below, on the
books kept by the undersigned for such purposes.
NAME AND ADDRESS OF
REGISTERED OWNERS
DATE OF
REGISTRATION
SIGNATURE OF
CITY ADMINISTRATOR/
FINANCE DIRECTOR
_________________________
_________________________
_____________, 20__
_________________________
_________________________
_________________________
_________________________
_____________, 20__
_________________________
_________________________
_________________________
_________________________
_____________, 20__
_________________________
_________________________
_________________________
_________________________
_____________, 20__
_________________________
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EXHIBIT C
SITE IMPROVEMENTS
Landscaping, including irrigation
Foundations and Footings
Grading/earthwork
Engineering
Survey
Environmental Testing
Soil Borings
Site Preparation
Onsite Utilities
Storm Water/Ponding
Outdoor Lighting
Onsite Road, Curb, Gutter, Driveway, Sidewalk and Streetscape Improvements
Parking
SAC/WAC
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EXHIBIT D
COMPLIANCE CERTIFICATE
The undersigned ___________________________, does hereby certify that as of the date
of this Certificate not less than 20% of the residential units in the
___________________________ Project located at ______________________________ in
Otsego, Minnesota (the "Project") are occupied by individuals whose income is 50% or less of
the Wright County median income.
Dated this ____ day of _________________, 20___.
RIVERVIEW LANDING, INC.
By _________________________________
Its
[Attach income verification required by Section 3.4]