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HomeMy WebLinkAbout06/12/1984PROCEEDINGS OF THE DOWNTOWN AD HOC COMMITTEE SVIAKOPEE, 14114NBSIDTA May 3.0, 1984 .h the Chrm. Laurent called the meeting to order at 7:30 A.M. wit Jim following voting members present: Steve Clay, Joe Topic, voting Stillman, Mike Sortum, Terry Link and Jerry Wampach. Non - Absent: members present: Lee Stoltzman and Paul Wermerskirchen. !sent: Bill Wermerskirchen Jr., Dan Steil & Don Martin. Also prE �n, Jeanne Andre, Community Development Director, John Andersc gator City Administrator, Barry Stock, Adm. Aide/Transit Coordir. and Ken Anderson, Consultant from Westwood Engineering. .nd Stillman/Link moved to approve the minutes of April 25th a May 2, 1984 as presented. Motion carried. Krier, Jeanne Andre reviewed the Financial Plan submitted by Dick own pro- which detailed the cost and revenue estimates of the Downt tax incre- ject. She suggested that the Mini -by-pass and the K -Mart .t under- ment should be dealt with as separate cost sections and tha in more detail ground utilities and assessments should be discussed by the committee. tee being to Discussion followed with the consensus of the commit the following direct staff to prepare a revised budget, reflecting t A (S % t 4 Sr Nn l a CtS' r� A � i� �^..n c •• 1_l r�Tq�n � ^.,�oL�;� } ?.Y. %-,U i, (included in towards the general benefits of public improvements project as this budget) and 40% available to be invested in the .or the Mini- negotiated with developers, 2) Separate the,. cost f i downtown by-pass improvements, and 3) determine how much eact targe. business would be assessed using a 25% assessment cY allocate $2.9 Also discussed was a request to the City Council to in as follows: million of the K -Mart tax increment money to downtou trds under- $1.9 million towards the Mini -by-pass, $500,000 town capital loan ground utilities and another $500,000 for a venture fund. :ation Plan as Ken Anderson of Westwood then reviewed the Transport the committee it related to the Downtown area. Recommending that to the down- concentrate on 4th Ave. as the main traffic corridor town area. will be Ken Anderson also reviewed three bridge proposals h( I one lane submitting to MnDOT for review. They are: 1) to adc existing to the existing bridge south bound, 2) to widen the I and two bridge by adding two lanes providing two north bounc :ream to south bound lanes or 3) build another structure upst _ng bridge accommodate two lanes south bound and use the exist] for north bound traffic. Discussion followed regarding the street plan. One item discussed was the closing of Atwood St. between St. Francis Hospital and St. Marks School, which would be beneficial to the hospital, church and school and could create a larger playground for the school. Mike Sortum left at 9:37 A.M. Link/Stillman made a motion to support the Shakopee City Street System as presented by Westwood Planning and Engineering Co. Motion carried. Ken Anderson left at 9:42 A.M. Jeanne Andre informed the committee of the plans for the new Family Chow Mein restaurant, which could be a commercial rehabil- itation loan opportunity. It was recommended that they be notified of the downtown design elements and sign restrictions proposed for the downtown area. Jeanne Andre also informed the committee to contact her if they had any suggestions for the informational letter going out to the downtown businessman before the public hearing. Phone numbers of members was suggested to be included in the letter. Link/Stillman moved to adjourn at 9:49 A.M. Motion carried. Toni Warhol Recording Secretary 6�, .REGULAR SESSION Mayor Reinke presiding 11 Roll Call at 7:00 p.m. TENTATIVE AGENDA SHAKOPEE, MINNESOTA 2] Recess for Board of Equalization 31 Continuation of Board of Equalization: JUNE 12, 1984 a] Review appeals of petitioner's assessed market value b] Continue/Close Board of Equalization (memos to be provided Monday or on table) 41 Reconvene 51 Liaison Reports from Councilmembers 61 RECOGNITION BY CITY COUNCIL OF INTERESTED CITIZENS 7] Approval of Consent Business - (All items listed with an asterick are considered to be routine by the City Council and will be enacted by one motion. There will be no separate discussion 54' i�a�� r7 Lee , �./2�2b` �,�,*�i+�'mb s0 %ef�uests, in which event the item will be removed from the consent agenda and considered in its normal sequence on the agenda.) 8] Communications: None 9] Public Hearings: None 10] Boards and Commissions: None as Up -date on On -Site Bona Issue ana Amendment to Agreement with Minnesota Racetrack Inc. b.] Directional Signs for the Racetrack Construction cl Renewal of 84185 Mon -Intoxicating KBlt Liquor Licenses tabled 6/5 - memo on table d] Renewal of 84/85 On Sale Wine License - tabled 6/5 - memo on table e] Renewal of 84/85 Off Sale Intoxicating Liquor Licenses - tabled 6/5 - memo on table ij RL if it -; u V i;' _0? —C T ^ ,: n r�3?h��� Ar Id -ceases - tabled 6/5 - memo on table g] Telephone Purchase b_ Trunk Highway 101 Frontage Road - County Road 89 to the West Line of Cretex Industrial Park 1st Addition JRes. -No. M V) is Procedures for Handling Damage Claims/Sewer Back-ups (bring i:te,& -13g tram. t l i ageada c j] Evaluation of City Streets - Consultant arriving at 9:00 Psm- (bring item 13h from 6/5 agenda) k] Probation Termination (bring item 13j from 6/5 agenda) 1] Staffing the Cable Communications Advisory Commission (bring item 13r from 6/5 agenda) m.] Secretarial Staffing for City Hall (bring item 13s from 615 agenda) -1_41 -,Rasa Iirttans __and Ordinances - None 151 Other Business a] City Employee Picnic - June 28th b] 161 Adjourn to June 19, 1984 at 7:00 p.m. Sohn K. Xnderson City Administrator 1W. PROCEEDINGS OF THE HOUSING AND REDEVELOPMENT AUTHORITY ADJ. REG. SESSION SHAKOPEE, MINNESOTA FEBRUARY 21, 1984 Chrm. Colligan called the meeting to order with Comm. Wampach, Lebens and Vierling present. Comm. Leroux was absent. Also present were Mayor Reinke, John K. Anderson, City Admr.; Judith S. Cox, City Clerk; Judi Simac, City Planner; H. R. Spurrier, City Engineer and Julius A. Coller, II, City Attorney. Wampach/Yierling moved to approve the minutes of February 7, 1984 as kept. Motion carried with Comm. Lebens abstaining because of her absence at that _ __Me_Pt_P0- VierlinF_1L<ebens`_mwec #,Q_ land. Motion carried unanimously. Jim Casserly, of O'Connor and Hannon, said this public hearing is a statutory requirement when the HRA is involved in the sale of public land, to receive pub- lic input regarding the proposed sale. He explained that the way the City is trying to structure its public commitment to the racetrack facility is to do a land write-down. He said this would be accomplished by the City purchasing a parcel of land for a certain sum of money, selling it back to the same or dif- ferent party for a lesser sum of money, and the difference is the amount the City is investing in the project. Therefore, the acquisition and sale back of the land is the way the City is going to proceed to have some public investment in the racetrack. He suggested taking public testimony at this hearing and continu- ing it to February 28th, when all the racetrack documents will be considered. Chrm. Colligan asked if there was anyone in the audience who wished to comment on this item, and there was no response. Lebens/Vierling moved to close the public hearing. Motion carried unanimously. Vierling/Lebens moved to direct staff to carry ovOr this public hearing until February 28, 1984. Motion carried unanimously. Mr. Casserly passed out a draft Contract for Private Development and Assessment Agreement with Minnesota Racetrack Limited Partnership. He said this Contract and the figures involved were just completed a little while ago, and the repre- sentative for the Racetrack has not seen them yet. He explained the figures were in +hp_ last gone through in December, mainly because of the drop of 12 since they were these figures represent the City's investment of $7 million in mills. He said th the developer's repayment of $3 million dollars. the project, wi en went through the Contract page by page, highligjLtin areas of cict and make the findings, but not approving the district by get - Led until the second meeting in November, 1984. He explained it L to get the district certified as late as possible in the calendar the 10 years runs from the date of certification, and this gives upporz u.iAiy' to capture' 'ine increme ht for 'ine" fa 1u years. " xe aaaea be meeting with the County to be sure they agree with these actions. Mr. Casserly th -.CO1fL increment distl ting it certif: is so importan- year, because that he will Shakopee HRA February 21, 1984 Page 2 nted out Article III, further explaining qualifying improve - those that could legitimately be put on with tax increment the developer will acquire the property and put on a minimum .ion dollars worth of qualifying improvements, and prepare a ualifying improvements. Then the City acquires the property, llion.dollars public investment in the on-site improvements L3i1i1C721 '(Sii11d2". 0111 -JFC OU'13a- y, `Oy `tZl �Ve'"JLlTurS ?`U3R1:iL'7fC- i{uem ttl.E �a�ptxac is i_n Q�e�a �QrL. lvi�-- }Pni�k,e� VUA, Q''CaLt itCt, 1d, - Lmiting to pay taxes through the term of the promissory note and agreement through 1.994. ;aid that Article VI is fundamental to this agreement, and he feels t budge on it. He said this converts a lien against the property s) into a personal judgment where these people are exposing them - for the payment of taxes. off-site improvements, which the rest of the agree - Further review took place. developer's representative, Mr. Malkerson, had any id he would like to study the numbers and get back r comments. .journ. Motion carried unanimously. Meeting adjourned Jeanne Andre "HRA Director Diane S. Beueh Recording Secre tary Mr. Casserly poi ments, which are funds. He said of $6 to $7 mill certificate of q making the $7 mi iii' �i'fi2 `y caT a veloper is con the assessment Mr. Casserly 2 the City canna (property taxe selves to personal judgment Article VII identifies the went assumes will be made. Chrm. Colligan asked if th4 comments. Mr. Malkerson sa in a day or two with furthe Lebens/Vierling moved to ad at 8;14 p.m. TO: Shakopee Housing and Redevelopment Authority (HRA) FROM: Jeanne Andre, Executive Director RE: Action on Racetrack Development DATE: June 11, 1984 Introduction: In planning to bring the proposed amendment to the develop- ment contract for the racetrack to the City Council for approval, John Anderson, City Administrator, was unaware that the HRA would also need to consider and adopt this amendment. Since HRA approval is necessary, a special meeting of that body has been called. Background: Jim Casserly explains in his June 7, 1984, memo why an amend- ment to the development proposal has been proposed. Since his memo was written, O'Conner Hannan has also received additional requests from the mortgage holder on other items which must be addressed in the amendment, as well as new documents which must be authorized (including a subordination and an intercreditor agreement). To complete the financial arrangements on Thursday, June 14th, as planned, the HRA and City Council must act on these matters at a meeting June 12th. Wood Kidner of O'Conner and Hannan is preparing further amendments, resolutions and an explanation of the new issues. His explanation will be included with this memo if received on time, or else will be on the table prior to the start of the meeting. Since an HRA meeting was not included on the Council agenda, it'is recomrnefiada` tr�azl'erieT' n^oIUm&S:_S ac�..ron��?nQ_Tae?n _ t nri after the Board of Review meeting before reconvening as the City Council. Action Requested: HRA - Adopt Resolution No. 84-5 u ,-,_� a,..') -7r Litt' Louncii I-JUUP . ne���,��z��z �.... ---- � 7 7-T C TI Ub b11AA�UrJlc� Jh; 129 East F=t AvenuC Shakopee. Minnesota 533n DEMO TO l qAL Sh noo Rogrri of Review FROM: Scott County Assessor's Office SZ,g1ECT: Valley Industrial Development Property ,)ATT..: June 12 198h, On June'7, 1984 I met with Mr. .Gary Eastland and Mr. Bruce Malkerson who were representing Valley Industrial Development. We discussed the values for the 1984 assessment of thirty—one parcels and came to an agreement on all of the parcels involved. Adjustments were made for the properties located outside of the MUSA Line and the allowed use of those properties. Enclosed is a listing of the values which were agreed upon for the 1984 assess— h parcel. ment and along with the parcel numbers and the acreage contained on eac P_ 1. 27 904 013 0 2• 27 905 001 0 3. 27 907 011 0 4. 27 907 015 0 5. 27 908 001 0 6. 27 908 002 1 7- 27 9Q8 -''{1 C 8. 27 909 004 0 9. 27 909 008 0 10. 27 909 009 0 11. 27 909 011 0 12. 27 909 012 0 13. 27 909 OU 1 14. 27 909 013 0 15. 27 909 014 0 16. 27 910 001 0 17. 27 910 003 0 18. 27 910 003 1 19. 27 910 008 0 20. 27 911 003 0 21. 27 914 016 0 22. 27 915 006 0 23. 27 042 001 0 24• 27 055 004 0 25• 27 055 010 0 26. 27 055 011 0 27. 27 077 002 0 28. 27 081 001 0 29. 27 081 010 0 30. 27 089 002 0 31. 27 089 003 0 TOTAL VALLEY INDUSTRIAL DEVELOPMENT Agreed upon values for the 1984 Assessment AREA CLASSIFICATION 40.00 Acres 118.86 Acres .50 Acres 39.00 Acres 56.85 Acres .76 Acres 71.45 Acres 38.00 Acres 40.00 Acres 40.00 Acres 39.00 Acres 82.87 Acres 2.68 Acres 119.08 Acres 40.00 Acres 25.62 Acres 125.03 Acres 71.80 Acres 215.00 Acres 118.00 Acres 2.10 Acres 1.35 Acres 39.75 Acres 32.36 Acres 2.87 Acres .09 Acres 5.95 Acres 5.99 Acres 2.61 Acres 7.65 Acres 4.57 Acres 1389.79 Acres Agr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. kgr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. Agr. 4-B Ind. Ind. 4-B 4-B 4-B 4-B 4-B 6/8/84 1984 FINAL VALUE $106,000 $317,300 $ 800 $ 96,400 $ 76,300 $ 900 $ 98,200 $ 29,200 $ 56,000 $ 56,000 $ 75,200 $131,340 's L J duu- $230,600 $ 56,000 $ 15,400 $287,600 $ 43,100 $129,000 $ 70,800 $ 1,300 $ 800 $ 56,900 $605,200 $ 46,000 $ 1,500 $ 95,200 $ 95,800 $ 41,800 $143,100 $ 85,500 ,050, o These values were discussed and agreed upon on June 7, 1984. Bruce Malkerson and Gary Eastland attended for Valley Industrial Development and Robert Schmitt for Scott County. CITY OF SHAKOPEE 129 Fast Fust Avenue, Shakopee, Minnesota 55379 Tp; 1984 Shakopee Board of Review FROM: Scott County Assessor's Office SI7SJEC7: George Flander's Property DA'I'S: June 12, 1984 PID #27 001 600 0 MEMO Mr. Flanders owns property located at 330 East 6th Avenue. The legal description for this property is Lot 7 Block 79 City of Shakopee. The lot area is 60' x 112' and the value on the lot is $12,700. The house was built in the 1940's and is a one story home with 1094 square feet. The house. has an 80% finished basement, 1 3/4 baths, 10 x 14 deck and a 10' x 14' patio. The garage is 141 x 22' built in 1948. The home was at one time a barracks located at the presbnt site -of Murphy's Landing in Shakopee. The original 1984 value for'the land and buildings was $53,500. Alter rechecking this parcel on June 61 1984 I have adjusted the valuef age and general condition to $509300. Mr. Flanders has agreed to this value for the 1984 assessment. ei trtr:� f CITY 129 East Fust Avenue; Shakopee. Minnesota 55379 MEMO I 98 c., i e "Rnard of Rev ow FgpNL. Scott Co nty Assessor's Office SUBjFL-T. Weinandt Acres lst Addition. DA'I'S ]ne 1 l 98L I met with Mr. and Mrs. Weinandt on June 8th to discuss the values on the lots in thier plat and the value of their farm house and outbuildings. After rechecking the buildings and lots Jr question} adjustments were made on the values of the following parcels: #z7 098 013 0 Adjusted Value Lot 1 Block 2 $4500 #27 098'014 0 Lot 2 Block 2 $4800 x#27 098 015 0 Lot 3 Block 2 $5 0 2 0 8 016,0 #7 9 Outlot A --7 I�r9 ?��700 I Mr. Weinandt has agreed to I� these values an e will be used for the 1984 - assessment if approved by this board. ``tai irjr�, CITY 129 East First Avenue; Shakopee. Minnesota 55379 MEMO TO: 198L. Sh_'-n ;_r a ,,a „� RPv;Pw FROM: Scott C)unty Assessor's Office SUBjEC-r.Harold Schneider Property DATE: June 12 1984 PID #27' 916 013 0 & #27 916 013 1 #27 921 001 0 I met with Mr. Schneider on June 8th to discuss the values on his land and buildings which are located in sections sixteen and twenty—one within the City of Shakopee. We discussed the ages and sizes of the buildings and the condition of both the buildings and land. Mr..Schneider has a water problem on the land which is the result of the drainage of adjacent farmer's fields. This drainage has created a water accumulation on Harold's land which has flooded about ten acres and made this portion of the farm unusable-at the present time. Agreements were reached on'the building valuation and the adjustments which were made for the water problems on the acreage were also approved by Mr. Schneider. The final" valuation for the 1984 assessment on these parcels is. ##27 916 013 1 & #27 916 013 0 Land $53600 Buildings $91800 Total $ 145,400 #27 921 001 0 Land $5$200 Buildings $70100 Total $ 1289300 CITY OF 129 Eaat First Avenue; Shakopee. Minnesota 55379 SUBjFCT. Sundance Medical Cly DATE: June 12l l9$L piD #27 004 139 0 The Sundance Medical Clinic was reassessed for the 1984 Assessment in order to achieve equalization in values used on other medical buildings thoughout Scott County. The original assessment placed the 1984.value at $255,700. After discussing this value with Gloria Vierling, from Sundance Clinic and Harold Smith, a tax the 194 consultant hired by the clinicv a fair value was arroneforttherl9$4 as8sessment assessment year. The value which has been agreed u is $2329800. — - is due to correct ages for the buildings The reduction -on the original value being used and consequently the depreciation rates for the buildings were changed to correspond to those ages. -' Mr. Smith notified me that it was his intention to advise Sundance Clinic to accept this revised value of $232,800. 129 East Fust Avenuee� Shakopee. Minnesota 53379 MEMO .TO: 1984 Sh FROM:+ Scott County Assessor's Office SUBJECr. Plats of Horizon Heights lst, 2nd, & 3rd DATE: June 12, 1984 Plat'Nos. 062 — Horizon Heights lst Plat No. 064 — Horizon Heights 2nd' Plat No. 069 — Horizon Heights 3rd After meeting with Walt Muhlenhardt today and discussing the vacant lots which he still owns in the above plats, I would recommend to the Board of Review to make the following adjustments: Horizon Heights lst Addition Lots 7, 91 12, and 13 Block 3 Reduce 1984 EMV to $9000 Lots 49 5, 6, 71 8, and 9 Blk. 2. Reduce 1984 ENV to $9000 _ Horizon Heightp 2nd Addition No Change Horizon Heights 3rd Addition Lot 3 Block 4 Reduce 1984 alV to $9000 These reduction are due to the lack of trees, shape of the lots, (narrow and long). The original EMV for 1984 was $9700 on each of the above lots. arce#27 97 001 0. Marie Muhlenhardt et. al. This parcel contains 151.61 acres and is the original farm of the Muhlenhardt family. After rechecking the land portion of this parcel and finding that there are approximately 2 acres of pasture land which cannot be used because County Road #16 intgrsects the land at this point. I recommend to the council acting as the Board of Review, that these 2 acres be classified as total llsvallue for thee1984ue on these 2 acres assessment bereduced from $187200 to to $200. The $186,200. Toll Free Minnesota (800) 862-6002 Toll Free Other States (800) 328-6122 Miller & Schroeder Municipals, Inc. Northwestern Financial Center, 7900 Xerxes Avenue South, Minneapolis, Minnesota 55431 • (612) 831-1500 MrMn12 ANTITTM TO: Mayor and Council Members - City of Shakopee FROM: James R. Casserly, Richard R. GravesVnt � RE: Update on Onsite Bond Issue and Develoeementwith Minnesota Racetrack, Inc. DATE: June 7, 1984 The Racetrack developers, their attorneys, the City Administrator, the City's bond counsel, and Miller & Schroeder met Wednesday, to resolve the issues that were discussed at the last council meeting. The goal of all the parties was to provide adequate security to the City but yet not handicap the lenders and investors in their financing of the project. The sources of funds for the project are as follows: A. $21,000,000 from the shareholders of Minnesota Racetrack Inc. (M.R.I.) presently $15,000,000 is an equity contribution and $6,000,000 is a loan secured by a subordinated mortgage. B. $4.5 million in land value C. $10.5 million are net proceeds from the sale of limited partnership interests. D. $25,000,000 from a non-recourse first mortgage with Twin City Federal E. $6,000,000 from the City of Shakopee. The total project cost is $67,000,000 with $36,000,000 representing real equity in the project (as opposed to loans and ignoring the City's $6,000,000). In analyzing the City's risk, one must consider the worst possible alternatives: Headquarters: Minneapolis, Minnesota Branch Offices: Downtown Minneapolis • Solana Beach, California • Northbrook, Illinois • St Paul, Minnesota+ Naples, Florida • Carson City, Nevada June 7, 1984 Page Two A. The project is not constructed. The project is now under construction and performance bonds are being secured from all of the subcontractors. $21,000,000 is already on deposit; $25,000,000 will be irrevocably commited to the project by June 15; the land transfer is being effectuated and the syndication is proceeding. This risk appears extremely small. B. The project defaults in its tax payments when the full valuation is being assessed (January 2, 1986 valuation for taxes payable in May and October of 1987). It is this scenario that provides the greatest potential problems. In the event taxes are not paid, the first mortgage is immediately in default (the timely payment of taxes being one of the essential terms of the mortgage). If the.taxes become delinquent, the mortgage holder has the option of paying the taxes and will usually initiate a foreclosure proceeding. However, the mortgage holder cannot get a recordable and thus marketable title to the property unless it pays all deliquent taxes. Delinquent taxes are a lien on the property which will have a priority even over the first mortgage for the simple reason that if taxes are not eventually paid, the property will forfeit to the State of Minnesota. This means that the investors would forfeit $36,000,000 in equity and the mortgage holder would forfeit its $25,000,000 for a total forfeiture of $61,000,000 all for the non-payment of taxes. This scenario is not inconceivable (I just described it), but it does defy the imagination. In order to make the last scenario more unimaginable, the following proposal has been drafted for the development agreement: 1. North American Life & Casualty Company, Santa Anita Company, and local investors will guarantee 25% of the total debt service on the bonds on a pro -rata (several) basis (this amounts to $3.5 to $4.0 million). 2. In the event of any non-payment of real estate taxes, the entire amount in 1. above is due and will not be credited to future tax payments but will be available for the payment of the bonds. 3. A letter of credit will be payable to the City for one year's debt service or, at the option of the City, 80% of one year's estimated taxes based on the estimated market value in the assessment agreement and the 1985 mill rate if available. A call upon the letter of credit would be an offset in the amount collectable in 2. above. 4. The Assessment Agreement will be executed by both Twin City Federal and M.R.I. 5. The Promissory Note will be executed by M.R.I. Again, describing our worst case scenario, we have in place two and a half years of capitalized interest plus a guarantee of approximately another two and a half years of debt service (40% funded by a letter of credit). On an 11 year bond issue, five years or more of debt service would be either funded or guaranteed. June 7, 1984 Page Three This worst case scenario assumes that the City will be issuing a general obligation tax increment bond. If the City funds the project with a revenue bond, then the risk is on the bond holders not the City. The revenue bond approach is being actively persued by the City and the developers. We recommend a revenue bond to completely eliminate any risk, but if such financing is not possible or available, we recommend that the City issue a general obligation bond as outlined above. O'CONNOR & HANNAN MEMORANDUM DATE: June 8, 1984 TO: Mayor and City Councilmembers - City of Shakopee FROM: O'Connor & Hannan, Wood Kidner SUBJECT: Proposed Amendment to Contract for Private Development between the City, the HRA and Minnesota Racetrack, Inc. As you know, the Contract for Private Development between the City, the HRA and MRI was originally executed as of February 28, 1984. I have enclosed with this memorandum for your review a proposed amended version of the Contract for Private Development to be considered for adoption by the City and the HRA next Tuesday night. The Agreement is blacklined to show modification from the February 28 Agreement. The changes to the Development Agreement fall generally into two categories. First, the amended Development Agreement contains modi- fications to the provisions of the original Agreement relating to the security to be provided to the City by the Developers with respect to the City's tax increment bond issue to finance on-site improvements for the racetrack. These modifications are discussed in detail in Jim Casserly's June 7, 1984 memorandum to the Council. Basically, the entities comprising the Developer agree to provide a letter of credit to the City equal to approximately one year's debt service on the tax increment bond issues and pro -rata guaranties by the principals aggregating 25 percent of the debt service on the bond issue (less the amount of the letter of credit), agree to have TCF execute the Assessment Agreement as first mortgagee and agree to seek to structure the tax increment issue for the on-site improve- ments as a revenue bond rather than a general obligation bond of the City. These modifications may be found in Sections 6.1, 6.2 and 7.1 of the Development Agreement. The second category of changes are modifications requested by Twin City Federal as first mortgagee. It was anticipated at the time the original Development Agreement was executed that certain modifications would be required to accommodate the interests of the primary construction lender for the Project once such construc- tion lender was identified. O'Connor & Hannan, as the City's coun- sel with respect to the Development Agreement, believes that the amendments requested by TCF and contained in the attached Agree- ment are reasonable and do not materially effect the interest of the City or the City's security with respect to the tax increment bonds. A few minor issues with respect to additional modifications requested by TCF remain to be negotiated between the City, TCF and the Developers. I am attempting to have these issues resolved as quickly as possible. I believe, however, that the enclosed Agree- ment represents substantially the amended Development Agreement which will be before the Council Tuesday night. 2 BND/shakopeel8 A Draft - 6/8/84 AMENDED CONTRACT FOR PRIVATE DEVELOPMENT By and Among THE CITY OF SHAKOPEE, MINNESOTA, THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF SHAKOPEE, MINNESOTA And MINNESOTA RACETRACK, INC. This document drafted by: O'CONNOR & HANNAN 3800 IDS Center Minneapolis, Minnesota 55402 TABLE OF CONTENTS (This Table of Contents is not part of the Contract for Private Development and is only for convenience of reference.) Page PARTIES......................................................1 PREAMBLE...................................................1 ARTICLE I - DEFINITIONS Section 1.1. Definitions ........................... ARTICLE II - REPRESENTATIONS, WARRANTIES AND COVENANTS Section 2.1. Representations, Warranties and Covenants by the Authority ............ 2-1 Section 2.2. Representations, Warranties and Covenants by the City ... ..... .......2-1 Section 2.3. Representations, Warranties and Covenants by the Company..............2-3 ARTICLE III - LAND TRANSACTIONS; UNDERTAKINGS OF THE AUTHORITY Section 3.1. Purchase of Development Property by the Company; Subsequent Conveyance and Reconveyance ........... 3-1 Section 3.2. Qualifying Improvements...............3-1 Section 3.3. Purchase of the Development Property by the Authority; Purchase Price ........................3-1 Section 3.4. Reconveyance of the Development Property; Development Property Deed; Costs ...........................3-4 ARTICLE IV - CONSTRUCTION OF MINIMUM IMPROVEMENTS Section 4.1. Construction of Minimum Improvements........ ................4-1 Section 4.2. Construction Plans ... :................ 4-1 Section 4.3. Commencement and Completion of Construction ..........................4-2 Section 4.4. Certificate of Completion ... .......... 4-3 ARTICLE V - INSURANCE AND CONDEMNATION Section 5.1. Insurance.............................5- Section 5.2. Condemnation......... ...............5-44 Section 5.3. Modification for Benefit of Mortgagees ............................5-5 (i) ARTICLE VI - ASSESSMENT AGREEMENT THE CITY AND AUTHORITY; TAX Section 6.1. Execution of Assessment Agreement ..... 6-1 Section 6.2. Real Property Taxes...................6-1 Issuance or Section 6.3. /iAACertain Guaranties; Letter of 7.2. Provision or Offsite improvements ..... Credit .... .... ........... ..........6-2 Section Section 6.4. Payment and Performance Bond .......... 6-3 ARTICLE VII - UNDERTAKINGS OF THE CITY AND AUTHORITY; TAX Section 8.1. INCREMENT BONDS Events of Default Defined ............ 10-1 Section 7.1. Issuance or Tax Increment Bonds ....... 7-1 Section 7.2. Provision or Offsite improvements ..... 7-1 Section 7.3. Limitations on Financial to Conveyance to the Company ......... Section 8.4. Undertakings of the City..............7-3 Section 7.4. Use of Tax Increments.................7-4 8.5. ARTICLE VIII - MORTGAGE FINANCING OF DEFAULT Section 8.1. Limitation Upon Encumbrance of Events of Default Defined ............ 10-1 Section Property..............................8-1 9-1 Section 8.2. Approval of Mortgage..................8-1 Revesting Title in the Authority Section 8.3. Notice of Default; Copy to Upon Happening of Event Subsequent Mortgagee...... ......................8-2 to Conveyance to the Company ......... Section 8.4. Mortgagee's Option to Cure Resale of Reacquired Property; Defaults..............................8-2 Disposition of Proceeds..............10-4 Section 8.5. Authority's Option to Cure Default No Remedy Exclusive........ .........10-6 Section on Mortgage ................ ..........8-2 No Additional Waiver Implied by Section 8.6. Subordination and Modification for One Waiver ...........................10-6 the Benefit of Mortgagees.............8-3 ARTICLE IX - PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER; ARTICLE X - INDEMNIFICATION OF DEFAULT Section 9.1. Status of Company; Transfer Events of Default Defined ............ 10-1 Section of Substantially All Assets ........... 9-1 Section 9.2. Prohibition Against Transfer of Revesting Title in the Authority Property and Assignment of Upon Happening of Event Subsequent Agreement.............................9-1 to Conveyance to the Company ......... Section 9.3. Release and Indemnification Resale of Reacquired Property; Covenants.............................9-3 Disposition of Proceeds..............10-4 Section 9.4. Approvals.............................9-4 No Remedy Exclusive........ .........10-6 ARTICLE X - EVENTS OF DEFAULT Section 10.1. Events of Default Defined ............ 10-1 Section 10.2. Remedies on Default .......... .......10-1 Section 10.3. Revesting Title in the Authority Upon Happening of Event Subsequent to Conveyance to the Company ......... 10-2 Section 10.4. Resale of Reacquired Property; Disposition of Proceeds..............10-4 Section 10.5. No Remedy Exclusive........ .........10-6 Section 10.6. No Additional Waiver Implied by One Waiver ...........................10-6 Section 10.7. Agreement to Pay Attorney's Fees andExpenses .........................10-6 Section 10.8. Non -Recourse Obligations.............10-6 ARTICLE XI - ADDITIONAL PROVISIONS Permitted Encumbrances .......................0-1 Section 11.1. Restrictions on Use..................11-1 Qualifying Improvements ......................D-1 Section 11.2. Conflicts of Interest ....... .........11-1 Certificate as to Completion and Costs Section 11.3. Provisions Not Merged With Deed ...... 11-1 Section .11.4. Titles of Articles and Sections...... 11-1 Section 11.5. Notices and Demands..................11-1 Section 11.6. Counterparts .........................11-2 Section 11.7. Modification .........................11-2 Section 11.8. Law Governing ........................11-2 Section 11.9. Legal Opinions ....................... 11-2 ARTICLE XII - TERMINATION OF AGREEMENT Permitted Encumbrances .......................0-1 Section 12.1. The Company's Options to Qualifying Improvements ......................D-1 EXHIBIT Terminate............................12-1 Certificate as to Completion and Costs Section 12.2. The City's and Authority's Options of Qualifying Improvements ...................E-1 EXHIBIT to Terminate .........................12-1 Form of Promissory Note......................F-1 Section 12.3. Action to Terminate..................12-1 Section 12.4. Effect of Termination................12-1 TESTIMONIUM.............................................12-2 SIGNATURES..............................................12-3 EXHIBIT A - Development Property .........................A-1 EXHIBIT B - Certificate of Completion and Release of Forfeiture...................................B-1 EXHIBIT C - Permitted Encumbrances .......................0-1 EXHIBIT D - Qualifying Improvements ......................D-1 EXHIBIT E - Certificate as to Completion and Costs of Qualifying Improvements ...................E-1 EXHIBIT F - Form of Promissory Note......................F-1 CONTRACT FOR PRIVATE DEVELOPMENT THIS AGREEMENT, made on or as of the 4_ day of/ =aj 1984, by and among the City of Shakopee, Minnesota (the "City"), a municipal corporation and political subdivision organized and existing, under the Constitution and laws of the State of Minnesota, the Housing and Redevelopment Authority in and for the City of Shakopee, Minnesota (the "Authority"), a public body corporate and politic, and Min- nesota Racetrack, Inc., a corporation organized and existing under the laws of the State of Minnesota (the "Company"), and amending the Contract for Private Development, dated _February 28, 1984, by and among the City, the Authority and_ the Company; WITNESSETH: WHEREAS, the City has the powers of a municipal corpora- tion under the laws and Constitution of the State of Minne- sota; and WHEREAS, the Authority has all the powers of a housing and redevelopment authority under the Municipal Housing and Redevelopment Act, Minnesota Statutes, Sections 462.411 to 462.716, inclusive, as amended (the "Housing and Redevelop- ment Act"); and WHEREAS, in furtherance of the objectives of the Housing and Redevelopment Act, the Authority is engaged in carrying out the redevelopment project known as Minnesota River Val- ley Housing and Redevelopment Project No. 1 (hereinafter referred to as the "Redevelopment Project") in an area (hereinafter referred to as the "Project Area") located in the City; and WHEREAS, as of the date of this Agreement there has been prepared and approved by the Authority and the City Council of the City, pursuant to the Housing and Redevelopment Act, the Modified Redevelopment Plan for Minnesota River Valley Housing and Redevelopment Project No. 1 (which plan, as amended, and as it may be further amended, is hereinafter referred to as the "Redevelopment Plan"), and WHEREAS, as of the date of this Agreement there has been prepared and approved by the Authority and given preliminary approval by the City, pursuant to Minnesota Statutes, Sec- tion 273.74, a proposed Tax Increment Financing Plan for Tax Increment Financing District No. 4 of the Redevelopment Project (which plan, as finally adopted and as it may be amended, and as it may be further amended, is hereinafter referred to as the "Tax Increment Financing Plan"), provid- ing for the use of tax increment financing in connection with the Redevelopment Project; and WHEREAS, the acquisition and the subsequent sale or lease of the potential development property to private de- velopers for commercial development is an objective of the Redevelopment Plan; and WHEREAS -,-in order to achieve the objectives of the Rede- velopment Plan and particularly to make the land in the Project Area available for development by private enterprise in conformance with the Redevelopment Plan, the Authority has determined to provide substantial aid and assistance in connection with the Redevelopment Plan through the financing of certain of the public costs of development within the Project Area; and WHEREAS, the City and the Authority believe that the construction of an approximately 390 acre horse -racing facility within the Project Area by the Company pursuant to this Agreement, and fulfillment generally of this Agreement, are in the best interests of the City and the Authority and in accord with the public purpose and provisions of the applicable state and local laws and requirements under which the Redevelopment Plan has been undertaken and is being as- sisted; and WHEREAS, the City, the Authority and the Company have previously executed a Contract for Private Development for the Project, dated as of February 28, 1984, and have found it necessary and desireable to make the Project feasible to hereby amend such Contract for Private Development, and have each received good and valuable consideration for this amendment; NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: - 2 - ARTICLE I Definitions Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Agreement" means this Contract for Private Development by and among the City, the Authority and the Company, as the same may be from time to time modified, amended or supple- mented. "Articles and Sections" mentioned by number only are the respective Articles and Sections of this Agreement so num- bered. "Assessor's Minimum Market Value" means the agreed mini- mum market value for calculation of real property taxes certified by the Assessor for the City for the Improved Parcel pursuant to the Assessment Agreement. "Assessment Agreement" means the assessment agreement to be executed by and between the Authority and the Company, and to be certified by the Assessor for the City, pursuant to the provisions and requirements of Minnesota Statutes, Section 273.76, Subdivision 8, establishing the Assessor's Minimum Market Value. "Authority" means the Housing and Redevelopment Author- ity in and for the City of Shakopee, Minnesota. "Authority Closing Date" means the date upon which the Authority and the Company close on the purchase of the De- velopment Property by the Authority and the reconveyance thereof to the Company pursuant to Article III. "Authority Mortgage" means the Mortgage upon the Im- proved Parcel given by the Company to the Authority pursuant -to Section 3.4(d), and securing payment of the Promissory Note. "Building Inspector" means the building inspector of the City. "Certificate of Completion" means the certification, in the form of the Certificate attached as Exhibit B hereto, provided to the Company pursuant to Section 4.4, upon com- pletion of the Minimum Improvements. "Certificate of Qualifying Improvements" means the cer- tification, substantially in the form of the Certificate attached as Exhibit E hereto, provided by the Company to the 1 - 1 Authority upon satisfactory completion of the Qualifying Improvements as provided in Section 3.2. "City" means the City of Shakopee, Minnesota. "Closing Date" shall have the meaning assigned to it in Section 3.1. "Company" means Minnesota Racetrack, Inc., a corporation organized and existing under the laws of Minnesota, or its successors or assigns under this Agreement, or a limited partnership of which Minnesota Racetrack, Inc., is a general partner and which it designates to act in its stead for all purposes hereunder, provided that such limited partnership assumes all obligations under this Agreement (with appropri- ate modifications to Section 9.1 to reflect partnership status). "Condemnation Award" means the amount remaining from an award to the Company for the acquisition, of title to and possession of the Improved Parcel, or any material part thereof, after deducting all expenses (including fees and disbursements of counsel) incurred in the collection of such award. "Construction Plans" means the plans, specifications, drawings and related documents on all construction work to be performed by the Company on the Development Property, including all on-site improvements to be performed, in- stalled or constructed upon the Development Property pur- suant to this Agreement, and including adequate specifica- tions detailing all Qualifying Improvements to be performed on the Development Property. Such plans shall, at a mini- mum, include, for each building or other structure to be constructed on the Development Property, at least the fol- lowing: (i) site plan; (ii) foundation plan; (iii) basement plans; (iv) floor plan for each floor; (v) cross sections of each (length and width); (vi) elevations (all sides); and (vii) landscape plan; and shall include as well adequate plans, drawings and specifications relating to all drive- ways, walks, parking, and other improvements to be con- structed upon the Development Property by the Company. The Site Plan submitted by the Company to the Building Inspector for the City, if approved by the Building Inspector and acceptable to the Authority, may serve as the Construction Plans. "Council" means the City Council of the City. "County" means the County of Scott, Minnesota. 1 - 2 "Development Property" means the real property described in Exhibit A of this Agreement. "Development Property Deed" means a quitclaim deed used to convey the Development Property from the Authority to the Company. "Environmental Assessment Worksheet"ars the Environ- mental Assessment Worksheet, if any, prepared pursuant to Minnesota Statutes, Section 116D.04, for the proposed im- provements to the Development Property. "Event of Default" means an action by the Company listed in Section 10.1. "First Mortgage" means any - Mortgage granted to secure any loan made pursuant to either ailmortgage commitment ob- tained by the Company from a commercial lender or other _ financial institution to fund the major portion of the con- struction costs and initial operating capital requirements of the Minimum Improvements or industrial revenue develop- ment bonds or notes issued by the City or the Authority to fund the major portion of the construction costs of the Minimum Improvements, or all such Mortgages as appropriate. "Franchise" means the Class A racing franchise to be awarded by the Racing Commission for operation of a horse- racing facility in the seven -county metropolitan area. "Guaranty" or "Guaranties" means any Guaranty or Guaranties provided to the City pursuant to Section 6.3(b). "Holder" means the owner of a Mortgage. "Housing and Redevelopment. Act" means the statutes lo- cated at Minnesota Statutes, Sections 462.411 through 462.716, inclusive, as amended. "Improved Parcel" means the Development Property and the completed Minimum Improvements. "Letter of Credit" means any Letter of Credit provided Lto the City pursuant to Section 6.3(a). "'minimum Improvements" means the approximately 390 acre horse -racing facility and all other improvements, including driveways, walks, landscaping, housing, stables and parking and fixtures and equipment, and all Qualifying Improvements, to be constructed by the Company upon the Development Prop- erty pursuant to this Agreement, as such improvements are described in the Construction Plans. 1 - 3 "Minnesota Environmental Policy Act" means the statutes located at Minnesota Statutes, Sections 116D.01 et seq., as amended. "Minnesota Environmental Rights Act" means the statutes located at Minnesota Statutes, Sections 1168.01 et seq., as amended. i "Mortgage" means any mortgage or security agreement in which the Company has granted a security interest in the Development Property, or any portion or parcel thereof, or any improvements constructed thereon, and which is a per- mitted encumbrance pursuant to the provisions of Article VIII. "National Environmental Policy Act" means the federal law located at 42 U.S.C., Sections 4331 et seq., as amended. "Net Proceeds" means any proceeds paid by an insurer to the Company, the Holder of any Mortgage, or the Authority under a policy or policies of insurance required to be pro- vided and maintained by the Company pursuant to Article V and remaining after deducting all expenses (including fees and disbursements of counsel) incurred in the collection of such proceeds. "Offsite Improvements" means the improvements to be undertaken by the Authority or the City pursuant to Section 7.2. "Party" means either the Company, the Authority or the City. "Parties" means the Company, the Authority and the City. "Permitted Encumbrances" means the encumbrances de- scribed in Exhibit C to this Agreement. "Project" means the Minimum Improvements and the Devel- opment Property. "Project Area" means the real property located within the boundaries of the Redevelopment Project. "Promissory Note" means the promissory note to be exe- cuted by the Company in favor of the Authority pursuant to Section 3.4(c). "Purchase Price" means the price to be paid by the Authority to the Company pursuant to Section 3.3(d) upon purchase of the Development Property. 1 - 4 "Qualifying Improvements" means those improvements mentcons listed on Exhibit D hereto which the Company plans struct, install and perform on the Development Property; all Qualifying Improvements shall be improvements which would be eligible to be financed with tax increment bond proceeds pursuant to the provisions of Minnesota Statutes, Chapters 273 and 462,_ and include, but are not necessarily limited to, site clearing and preparation, soil correction, berming, construction of sidewalks, curbs, curb cuts, streetscape amenities, ponding and drainage improvements and facilities, installation of trunk line utilities and any other improve- ments of a predominantly public nature. "Racing Commission" means the Minnesota Racing Commis- sion. "Redevelopment Plan" means the Authority's Modified Housing and Redevelopment Plan for Minnesota River Valley Housing and Redevelopment Project No. 1, as amended and as it shall be amended. "Redevelopment Project" means Minnesota River Valley Housing and Redevelopment Project No. 1 in the City created by the Authority. "Repurchase Price" means the sum to be paid by the Com- pany to the Authority upon repurchase of the Development Property by the Company pursuant to the terms of Section 3.4. "State" means the State of Minnesota. "Tax Increment Bonds" means thea tax increment bonds which the City intends to issue to finance certain public costs associated with the Redevelopment Plan, including the public redevelopment costs of the Project. The term "Tax Increment Bonds" shall also include any obligations issued to refund the Tax Increment Bonds. "Tax Increment District" means Tax increment Financing District No. 4, to be formed in the Project Area by the Authority with the approval of the City. "Tax Increment Financing Act" means the statutes located at Minnesota Statutes, Sections 273.71 through 273.78, in- clusive, as amended. "Tax Increment Financing Plan" means the Authority's Tax Increment Financing Plan for the Tax Increment District. "Tax official" means any City or County Assessor, County Auditor, or City, County or State Board of Equalization; the 1 - 5 Commissioner of Revenue of the State; or any State or Fed- eral District Court, the Tax Court of the State or the State Supreme Court. "Termination Date" means the date of expiration of the Assessment Agreement as provided in Section 6.1. "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 Minimum Improvements, litigation commenced by third parties which, by injunction or other similar judicial ac- tion 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 or the Authority) which directly result in delays. 1 - 6 ARTICLE II Representations, Warranties and Covenants nd nts Section 2r it ReThes Authority represents, awar rants aand by the Autho y covenants that: (a) The Authority has all the powers of a housing and redevelopment authority under the laws of the State. Under the provisions of the Housing and Redevel- opment Act, the Authority has the power to enter into this Agreement and carry out its obligations hereunder. (b) The Redevelopment. Project is a "redevelopment project" within the meaning of the Housing and Redevel- opment Act and was created, adopted and approved in accordance with the terms of the Housing and Redevelop- ment Act. (c) The Authority has examined this Agreement, and has determined that its terms and provisions are in accordance with the objectives embodied in the Redevel- opment Plan, and are in the best interests of the Authority and the City. (d) The Tax Increment District will be a "tax increment financing district" within the meaning of the Tax Increment Financing Act, and will be created, adopted and approved in accordance with the provisions of the Tax Increment Financing Act. (e) Subject to fulfillment of the terms and con- ditions of this Agreement by the Company, the Authority shall purchase the Development Property and reconvey the Development Property to the Company as provided in Arti- cle III for uses in accordance with the Redevelopment Plan and this Agreement. (f) The Authority makes- no representation or war- ranty, either express or implied, as to the Development Property or its condition or soil conditions thereon, or that the Development Property shall be suitable for the Company's purposes or needs. Section 2.2. Re resentations, Warranties and Covenants by the City. The City represents, warrants and covenants that: (a) The City is a municipal corporation and poli- tical subdivision organized under the provisions of the Constitution and the laws of the State. 2 - 1 (b) The City has the power to enter into this Agreement and carry out its obligations hereunder pursu- ant to the powers granted to it by the Constitution and laws of the State. (c) The Redevelopment Project is a "housing and redevelopment project" within the meaning of the Housing and Redevelopment Act and was created, adopted and ap- proved in accordance with the terms of the Housing and Redevelopment Act. (d) The Tax Increment District will be a "tax increment financing district" within the meaning of the Tax Increment Financing Act, and will be created, adopted and approved in accordance with the provisions of the Tax Increment Financing Act. (e) The City has examined this Agreement, and has determined that its terms and provisions are in accor- dance with the objectives embodied in the Redevelopment Plan, and are in the best interests of the City and the Authority. _ (f) The City shall use its best efforts to issue general obligation tax increment bonds of the City (the "Tax Increment Bonds") to finance the acquisition of the Development Property and construction and installation of the Offsite Improvements by the City and the Author- ity pursuant to the terms of this Agreement. (g) The Minimum Improvements constitute a permit- ted use under the zoning ordinance of the City. (h) The City has approved the Environmental Assessment Worksheet prepared by Barton-Aschman Associ- ates, Inc. and submitted it to the Minnesota Environ- mental Quality Board, and has submitted the Environ- mental Impact Statement to the Minnesota Environmental Quality Board on or about February 17, 1984, and the City has no knowledge of any reason why such actions will not be fully adequate to comply with the National Environmental Policy Act and the Minnesota Environmental Policy Act. The City has received no notice or communi- cation from any local, state or federal official that the activities of the Company or the City with respect to the Development Property may or will be in violation of any environmental law or regulation (other than those notices or communications, if any, of which the Company has been notified). The City is aware of no state or federal claim filed or planned to be filed by any party relating to any violation of any local, state or federal 2 - 2 environmental law, regulation or review procedure, nor is the City aware of any violation of any local, state or federal law, regulation or review procedure which would give any person a valid claim under the Minnesota Environmental Rights Act or other state or federal en- vironmental statute. (i) The City makes no representation or warranty, either express or implied, as to the Development Prop- erty or its condition or the soil conditions thereon, or that the Development Property shall be suitable for the Company's purposes or needs. (j) The City by resolution has made the findings required by Section 273.74, Subdivision 3, of the Tax Increment Financing Act for' the Tax Increment District, and has set forth in writing the reasons and supporting facts for each determination. Section 2.3. Representations, Warranties and Covenants by the Company. The Company represents, warrants and cove- nants that: (a) The Company is a cor oration duly organized under the laws of the State, is not in violation of any provisions of itsAArticles of Incorporation or Bylaws or the laws of the State and has power to enter into this Agreement and to perform its obligations hereunder. (b) In the event the Development Property is con- veyed to the Company by the Authority, then the Company will construct, operate and maintain the Minimum Im- provements upon the Development Property in accordance with the terms of this Agreement, the Redevelopment Plan and all local, state and federal laws and regulations (including, but not limited to, environmental, zoning, building code and public health laws and regulations). (c) The Development Property and the Minimum Im- provements will b acquired and constructed by the Com- pany at a cost of at least $41,000,000_. (d) The Company is aware of the actions taken by the Authority and the City with respect to local, state and federal environmental laws and regulations, includ- ing the National Environmental Policy Act of 1969 and the Minnesota Environmental Policy Act, and the Company has no knowledge of any reason why such actions will not be fully adequate to comply with such laws. The Company has received no notice or communication from any local, state or federal official that the activities of the Company, the Authority or the City with respect to the 2 - 3 Project may be or will be in violation of any environ- mental law or regulation (other than those notices or communications, if any, of which the Authority and the City have been notified). With respect to the Project, the Company is aware of no violation of any local, state or federal environmental law, regulation or review pro- cedure, nor of any facts which would give any person a valid claim under the Minnesota Environmental Rights Act. (e) The Company will use its best efforts to con- struct the Minimum Improvements in accordance with all local, state or federal energy -conservation laws or regulations. (f) The Company will use its best efforts to ob- tain, in a timely manner, all required permits, licenses and approvals, and to meet, in a timely manner, all re- quirements of all applicable local, state and federal laws and regulations which must be obtained or met be- fore the Minimum Improvements may be lawfully con- structed. (g) The execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, and the fulfillment of or compliance with the terms and conditions. of this Agreement and the Assess- ment Agreement are not prevented or limited by, or in conflict with, or will result in a breach of, the terms, conditions or provisions of the articles of incorpora- tion and bylaws of the Company or any evidences of in- debtedness, agreements or instruments of whatever nature to which the Company is now a party or by which it is bound, or will constitute a default under any of the foregoing. (h) The Company will cooperate with the Authority and the City with respect to any litigation commenced with respect to the Project. (i) The financing commitments which the Company has obtained to finance construction of the Minimum Improvements, together with financing provided by the Authority and the City pursuant to this Agreement, will be sufficient to enable the Company to successfully complete the Minimum Improvements in conformance with the Construction Plans. (j) The Company will cooperate fully with the City and the Authority in the resolution of any traffic, parking, trash removal or public safety problems which may arise in connection with the construction and opera- tion of the Project. 2 - 4 (k) The Company would not undertake the Project without the financing provided by the Authority and the City pursuant to this Agreement. (1) The Company expects that, barring Unavoidable Delays, the Project will be substantially completed by, and will open in, the month of June, 1985. 2 - 5 ARTICLE III Land Transactions; Undertakings of the Authority Section 3.1. Purchase of Development Property by the Company; Subsequent Conveyance and Reconveyance. The par- ties intend that the Company shall initially acquire the Development Property in its entirety. The Company repre- sents thatIt or parties affiliated with it presently own or have purchase agreements with respect to the Development Property in its entirety. Subject to Unavoidable Delays, the Company sh11 close the purchase of the Development Property within ninet 90)_ days of grant of the Franchise to the Company (the date of closing on such purchase is hereinafter referred to as the "Closing Date"). The Parties then intend that the Authority shall, upon the completion of the requisite Qualifying Improvements by the Company, pur- chase the Development Property from the Company for an amount equal to the Purchase Price, and reconvey title and possession of the Development Property to the Company for an amount equal to the Repurchase Price, all pursuant to the terms and provisions of Sections 3.3 and 3.4. Section 3.2. Qualifying Improvements. Subject to Un- avoidable Delays, the Company shall commence construction of Qualifying Improvements: (i) within thirty (30) days of the Closing Date; or (ii) on such other date as the Parties shall mutually agree. Subject to Unavoidable Delays, the Company shall proceed diligently with the construction, installation and performance of such Qualifying Improve- ments. Upon substantial completion of the requisite Quali- fying Improvements, the Company shall submit to the Author- ity a certification as to such completion and as to the actual costs incurred by the Company for such Qualifying Improvements substantially in the form of the Certificate of Qualifying Improvements. The Qualifying Improvements shall be completed in substantial conformance with the Construc- tion Plans. The requisite Qualifying Improvements are those listed on Exhibit D attached to this Agreement or otherwise permitted which are first completed, whether or not other Qualifying Improvements have been commenced, at an aggregate cost of $6,000,000 or such lesser amount as has been ex- pended prior to the time that construction of the Minimum Improvements, in the judgment of the Company, necessitates conveyance and reconveyance of the Development Property. Section 3.3. Purchase of the Development Property by the Authority; Purchase Price. (a) Purchase of Development Property. Subject to the provisions of paragraphs (b) and (c) of this Section 3.3, within forty-five (45) days of receipt of the Cer- 3 - 1 tificate of Qualifying Improvements from the Company, the Authority will purchase the Development Property from the Company for the sum of the Purchase Price, said Purchase Price to be calculated as provided in Section 3.3(d). The Company shall deliver title of the Develop- m,ent Property to the Authority by quitclaim deed. (b) Title Insurance. The Company shall take all steps necessary to obtain a commitment for the issuance of a mortgagee's title insurance policy with respect to the Development Property. The commitment shall be ob- tained from a title insurance company licensed to do business in the State. The commitment shall name the Authority as an insured and shall be issued in the amount of $3,000,000. The commitment shall be subject solely to Permitted Encumbrances. The Company shall obtain such commitment and deliver a copy of such com- mitment to the Authority at least five (5) days prior to the Authority Closing Date. Failure of the Authority to object in writing to the title conveyed prior to the Authority Closing Date shall constitute acceptance of such title in all respects by the Authority, and any objections of the Authority to such title shall be deemed waived. (c) Conditions Precedent. The Authority's -obliga- tion to purchase the Development Property from the Com- pany shall be subject to satisfaction of the following conditions precedent: (i) The Company shall be in material com- pliance with all the terms and provisions of this Agreement; (ii) The Company shall have submitted Con- struction Plans, which shall have been approved by the Authority, pursuant to Section 4.2; (iii) The Authority shall be satisfied that the Company has firm commitments for construction and permanent financing for the Project in an amount sufficient, together with equity commitments, to complete the Project in conformance with the Con- struction Plans, or the Authority shall receive such other evidence of financial ability as in the reasonable judgment of the Authority is required; (iv) Execution by and between the Authority and the Company of an Assessment Agreement pursuant to Section 6.1; 3 - 2 (v) Completion of the requisite Qualifying Improvements in substantial conformance with the Construction Plans and execution by the Company of the Certificate of Qualifying Improvements; (vi) Receipt by the Authority of the mort- gagee's title insurance policy required by Section 3.3(b); (vii) Delivery to the Authority of the letter of credit and cuaranties reQu'red by Section 6.3; (viii) Delivery of a payment and performance bond as required by Section 6.4; and (ix) The Franchise shall have been awarded to the Company by the Racing Commission and shall be in good standing. The Company agrees that, if, upon the Authority Closing Date, all conditions precedent provided above in Subsec- tions 3.3(b)(i) through 3.3(b)(ix) are not satisfied, the Authority shall have no obligation under this Agree- ment to purchase the Development Property. (d) Purchase Price. The Authority shall purchase the Development Property from the Company for immedi- ately available funds in the amount of the Purchase Price in consideration of the covenants of the Company to develop the Development Property in accordance with the provisions of this Agreement and the Redevelopment Plan, and as an inducement to the Company to construct the Minimum Improvements. The purchase and reconveyance of the Development Property is intended to reduce the cost of acquisition and improvement of the Development Property to the Company. The Purchase Price shall be payable in full by the Authority at closing. The Pur- chase Price shall be calculated as follows: (i) The "Base Purchase Price" shall be $4,708,000, the Company's cost for the Development Property. (ii) There shall be added to the Base Purchase Price the total of the costs of the requisite Qual- ifying Improvements as certified in the Certificate of Qualifying Improvements, up to a maximum addi- tion of $6,000,000; the sum shall be the Purchase Price. In no event shall the Purchase -Price to be paid by the Authority exceed $10,708,000. There- fore, if the certified cost of the Qualifying Im- provements shall be less than $6,000,000, the Pur - 3 - 3 chase Price shall be the Base Purchase Price plus such cost; if the certified cost of the Qualifying Improvements shall be equal to or greater than $6,000,000, the Purchase Price shall be the sum of $10,708,000. Section 3.4. Reconveyance of the Development Property; Development Property Deed; Costs. (a) Reconveyance; Development Property Deed. Subsequent to purchase of the Development Property by the Authority, the Authority shall immediately reconvey marketable title and possession of the Development Prop- erty to the Company under a quitclaim deed (the "Devel- opment Property Deed") for the sum of the Repurchase Price; provided, however, that the Authority shall have no obligation to deliver title to the Development Prop erty to the CompanV which is superior in anV res ecz the title received by the Authority from the CQmnanv. Unless the Company and the Authority shall otherwise agree, the reconveyance shall occur on the Authority Closing Date. After the conveyance of the Development Property, the Company's use of the Development Property shall be subject to all of the conditions, convenants, restrictions and limitations imposed by this Agreement and the Development Property Deed. After the recon- veyance of title to the Development Property, the Com- pany's use of the Development Property shall also be subject to the Permitted Encumbrances and building and zoning laws and ordinances and all other local, state and federal laws and regulations. (b) Costs. Unless otherwise mutually agreed by the Authority and the Company, the execution and deliv- ery of all deeds shall be made at the principal office of the Authority. The Development Property Deed shall be in recordable form and shall be promptly recorded, with this Agreement attached thereto as an Exhibit, unless previously recorded. The Company shall pay all costs for recording the Development Property Deed, if any; the Development Property Deed will be processed by the Parties to be exempt from recording fees and deed tax to the extent possible. The Company shall also pay at closing all costs incurred by the Authority for prep- aration of the Development Property Deed. (c) Repurchase Price; Promissory Note. The Repur- chase Price shall be the sum of $7,708,000. The Author- ity shall accept as payment- of the Repurchase Price at closing (i) the amount of $4,708,000 in immediately available funds and (ii) the amount of $3,000,000 in the form of the promissory note (the "Promissory Note") of 3 - 4 the Company. The Promissory Note shall provide that the Company shall pay the principal amount of the Promissory Note, plus accrued interest on the outstanding principal balance thereof at a rate of ten percent (10%) per annum, over a period of 120 months, with interest com- mencing on the earlier of (i) the first anniversary of the date which is the first day of the first calendar month next immediately succeeding the first day the Project -is open to members of the general public as a horseracing facility; or (ii) May 1, 1987, with the first monthly payment of principal and interest to occur on the first day of the first month thereafter. The Company shall make equal monthly payments on the Promis- sory Note on the first day of each month during the repayment term of the Promissory Note. The Promissory Note shall provide that the Company may prepay the Note without penalty upon any payment date. (d) Authority Mortgage. Upon the Authority Closing Date, the Company and the holder of fee title to the Development Property, if other than the Company, shall execute a mortgage (the "Authority Mortgage") on the Project in favor of the Authority. The Authority Mortgage shall cover and secure payment when due of all principal and interest owing from the Company to the Authority under the Promissory Note, together with any renewals or extensions thereof. The Authority Mortgage shall grant a lien and security interest unto the Authority of all right, title and interest of the Com- pany in the Project together with the hereditaments and appurtenances thereto, including the Development Prop- erty, the Minimum Improvements, and all other buildings, structures, improvements and appurtenances then standing or anytime thereafter constructed or placed upon the Development Property, and shall be otherwise in form and substance reasonably satisfactory to the Authority. The Authority Mortgage shall provide that the Authority shall subordinate the Authority Mortgage to the lien and security interest of any First Mortgage (including a First Mortgage with respect to construction financing and/or a First Mortgage with respect to permanent financing) obtained by the Company meeting the require- ments of Article VIII hereof. The lien and the security interest of the Authority Mortgage shall be subject only to Permitted Encumbrances and the lien of the First Mortgage. 3 - 5 ARTICLE IV Construction of Minimum Improvements Section 4.1. Construction of Minimum Improvements. The Company agrees that 17t will construct the Minimum Improve- ments on the Development Property in conformance with the approved Construction Plans. The Company agrees that the' scope and -scale of the Minimum Improvements to be con- structed shall not be significantly less than the scope and scale of the Minimum Improvements as detailed and outlined in the Construction Plans. Section 4.2. Construction Plans. (a) The Company shall provide the Authority with Construction Plans, which shall be subject to approval by the Authority as provided in this Section 4.2. The Construction Plans shall provide for the construction of the Minimum Improvements, including specifications for all Qualifying Improvements to be constructed or per- formed by the Company on the Development Property, and shall be in conformity with the Development Program, this Agreement, the Environmental Assessment Worksheet, if any, prepared with respect to the Project, and all applicable state and local laws and regulations. The Authority shall approve the Construction Plans, in writ- ing if: (a) the Construction Plans conform to the terms and conditions of this Agreement; (b) the Construction Plans conform to the terms and conditions of the Rede- velopment Plan; (c) the Construction Plans conform to all applicable federal, State and local laws, ordi- nances, rules and regulations; (d) the Construction Plans are adequate for purposes of this Agreement to provide for the construction of the Minimum Improve- ments; and (e) no Event of Default has occurred; pro- vided, however, that any such approval of the Construc- tion Plans pursuant to this Section 4.2 shall constitute approval for the purposes of this Agreement only and shall not be deemed to constitute approval or waiver by the City with respect to any building, zoning or other ordinances or regulation of the City, and shall not be deemed to be sufficient plans to serve as the basis for the issuance of a building permit if the Construction Plans are not as detailed .or complete as the plans otherwise required for the issuance of a building per- mit. The Site Plan submitted for the Development Prop- erty by the Company to the Building Inspector shall be adequate to serve as the Construction Plans, if such Site Plan fulfills the requirements of this Section 4.2 and is approved by the Building Inspector. Such Con- struction Plans must be rejected in writing by the 4 - 1 Authority within fifteen (15) days of submission or shall be deemed to have been approved by the Author- ity. If the Authority rejects the Construction Plans in whole or in part, the Company shall submit new or cor- rected Construction Plans within thirty (30) days after receipt by the Company of written notification of the rejection, accompanied by a written statement of the Authority specifying the respects in which the Construc- tion Plans submitted by the Company fail to conform to the requirements of this Section 4.2. The provisions of this Section 4.2 relating to approval, rejection and resubmission of corrected Construction Plans shall con- tinue to apply until the Construction Plans have been approved by the Authority; provided, however, that in any event the Company shall submit Construction Plans which are approved prior to'reconveyance of the Develop- ment Property to the Company by the Authority or com- mencement of construction of the Minimum Improvements. Approval of the Construction Plans by the Authority shall not relieve the Company of any obligation to com- ply with the terms and provisions of this Agreement, or the provisions of applicable federal, state and local laws, ordinances and regulations, nor shall approval of the Construction Plans by the Authority be deemed to constitute a waiver of any Event of Default. (b) If the Company desires to make any material change in the Construction Plans after their approval by the Authority, the Company shall submit the proposed change to the Authority for its approval. If the Con- struction Plans, as modified by the proposed change, conform to the approval criteria listed in Section 4.2(a) with respect to the original Construction Plans and do not constitute a material modification to the scope, size or use of the Project or to the site plan therefor, the Authority shall approve the proposed change. Such change in the Construction Plans shall be deemed approved by the Authority unless rejected in writing. within ten (10) days by the Authority with a statement of the Authority's reasons for such rejection. Section 4.3. Commencement and Completion of Construc- tion. Subject to Unavoidable Delays, the Company shall commene construction of the Minimum Improvements: (i) withinxone hundred eighty (180) -days of award to the Company of the Franchise; or (ii) on such other date as the Parties shall mutually agree in writing. Subject to Unavoidable Delays, the Company shall have substantially completed the construction of the Minimum Improvements by June 1, 1986. Time lost as a result of Unavoidable Delays shall be added to extend this date beyond June 1, 1986, a number of days equal to the number of days lost as a result of Unavoidable 4 - 2 Delays. All work with respect to the Minimum Improvements to be constructed or provided by the Company on the Develop- ment Property shall be in conformity with the Construction Plans as submitted by the Company and approved by the Authority. The Company agrees for itself, and every successor in interest to the Development Property, or any part thereof, and the Development Property Deed shall contain covenants on the part of the Company and such successors and assigns, that the Company, and such successors and assigns, shall promptly begin and diligently prosecute to completion con- struction of the Minimum Improvements thereon, and that such construction shall in any event be commenced and completed within the period specified in this Section 4.3. It is intended and agreed, and the Development Property Deed shall so expressly provide, that such agreements and covenants shall be covenants running with the land and that they shall, in any event, and without regard to technical classi- fication or designation, legal or otherwise, and except only as otherwise specifically provided in this Agreement, be, to the fullest extent permitted at law and in equity, binding for the benefit of the Authority and enforceable by the Authority against the Company and its successors and assigns. Subsequent to reconveyance of the Development Property, or any part thereof, to the Company, and until construction of the Minimum Improvements has been completed, the Company shall make reports to the Authority, in such detail and at such times as may reasonably be requested by the Authority, as to the actual progress of the Company with respect to construction of the Minimum Improvements. The Company also agrees that it shall allow designated represen- tatives of the Authority to enter upon the Development Prop- erty during the construction of the Minimum Improvements to inspect such construction. Section 4.4. Certificate of Completion. (a) Promptly after completion of the Minimum Im- provements in accordance with the provisions of this Agreement, the Authority will furnish the Company with a Certificate of Completion, in substantially the form set forth in Exhibit B attached hereto. Such Certificate of Completion shall be (and it shall be so provided in the Development Property Deed and in the Certificate of Completion itself) a conclusive determination of satis- faction and termination of the agreements and covenants in this Agreement and in the Development Property Deed with respect to the obligations of the Company, and its successors and assigns, to construct the Minimum Im- provements. 4 - 3 (b) The Certificate of Completion shall be re- corded in the proper office for the recordation of deeds and other instruments pertaining to the Development Property. If the Authority shall refuse or fail to provide a Certificate of Completion in accordance with the provisions of this Section 4.4, the Authority shall, within ten (10) days after written request by the Com- pany, provide the Company with a written statement indi- cating -in adequate detail in what respects the Company has failed to complete the Minimum Improvements in accordance with the provisions of this Agreement, or is otherwise in default under the terms of this Agreement, and what measures or acts it will be necessary, in the opinion of the Authority, for the Company to take or perform in order to obtain such Certificate of Comple- tion. 4 - 4 ARTICLE V Insurance and Condemnation Section 5.1. Insurance. (a) The Company will provide and maintain or cause to be maintained at all times during the process of con- structing the Minimum Improvements and, from time to time at the request of the Authority, furnish the Authority with proof of payment of premiums on: (i) Builder's risk insurance, written on the so-called "Builder's Risk -- Completed Value Basis," in an amount equal to one hundred percent (100%) of the insurable value of the Minimum Im- provements at the date of completion, and with coverage available in nonreporting form on the so- called "all risk" form of policy; the interest of the Authority shall be protected in accordance with a clause in form and content satisfactory to the Authority; (ii) Comprehensive general liability insurance (including operations, contingent liability, opera- tions of subcontractors, completed operations and contractual liability insurance) together with an Owner's Contractor's Policy with limits against bodily injury and property damage of not less than $1,000,000 for each occurrence (to accomplish the above -required limits, an umbrella excess liability policy may be used); and (iii) Worker's compensation insurance, with statutory coverage. (b) Upon completion of construction of the Minimum Improvements and prior to the Termination Date, the Company shall maintain, or cause to be maintained, at its cost and expense, and from time to time at the re- quest of the Authority shall furnish proof of the pay- ment of premiums on, insurance as follows: (i) Insurance against loss and/or damage to the Minimum Improvements under a policy or policies covering such risks as are ordinarily insured against by similar businesses, including (without limiting the generality of the foregoing) fire, extended coverage, vandalism and malicious mis- chief, explosion, water damage, demolition cost, debris removal, and collapse in an amount not less than the full insurable replacement value of the 5 - 1 Minimum Improvements, but any such policy may have a deductible amount of not more than $50,000. No policy of insurance shall be so written that the proceeds thereof will produce less than the minimum coverage required by the preceding sentence, by reason of co-insurance provisions or otherwise, without the prior consent thereto in writing by the Authority. The term "full insurable replacement value" shall mean the actual replacement cost of the Minimum Improvements (excluding foundation and excavation costs and costs of underground flues, pipes, drains and other uninsurable items) and equipment, and shall be determined from time to time at the request of the Authority, but not more frequently than once every three years, by an in- surance consultant or insurer selected and paid for by the Company and approved by the Authority. All policies evidencing insurance required by this subparagraph (i) with respect to the Minimum Im- provements shall be carried in the names of the Company, the Authority and the Holder of the First Mortgage, as their respective interests may appear. (ii) Comprehensive general public liability insurance, including personal injury liability for injuries to persons and/or property, including any injuries resulting from the operation of automo- biles or other motorized vehicles on or about the Development Property, in the minimum amount for each occurrence and for each year of $1,000,000, and shall be endorsed to show the Authority as an additional insured. (iii) Such other insurance, including worker's compensation insurance respecting all employees of the Company, in such amount as is customarily car- ried by like organizations engaged in like activ- ities of comparable size and liability exposure; provided that the Company may be self-insured with respect to all or any part of its liability for worker's compensation. (c) All insurance required in this Article V shall be taken out and maintained in responsible insurance companies selected by the Company which are authorized under the laws of the State to assume the risks covered thereby. The Company will deposit annually with the Authority copies of policies evidencing all such insur- ance, or a certificate or certificates or binders of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Article V, each policy shall contain a provision that 5 - 2 the insurer shall not cancel or modify it without giving written notice to the Company and the Authority at least thirty (30) days before the cancellation or modification becomes effective. Not less than fifteen (15) days prior to the expiration of any policy, the Company shall furnish the Authority evidence -satisfactory to the Authority that the policy has been renewed or replaced by another policy conforming to the provisions of this Article V, or that there is no necessity therefor under the terms hereof. In lieu of separate policies, the Company may maintain a single policy, or blanket or umbrella policies, or a combination thereof, which pro- vide the total coverage required herein, in which event the Company shall deposit with the Authority a certifi- cate or certificates of the respective insurers as to the amount of coverage in force upon the Minimum Im- provements. (d) The Company agrees to notify the Authority immediately in the case of damage exceeding $100,000 in amount to, or destruction of, the Minimum Improvements or any portion thereof resulting from fire or other casualty. In the event that any such damage does not exceed $500,000, Net Proceeds of any such insurance shall be paid directly to the Company, and the Company will forthwith repair, reconstruct and restore the Min- imum Improvements to substantially the same or an im- proved condition or value as they existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restora- tion, the Company will apply the Net Proceeds of any insurance relating to such damage received by the Com- pany to the payment or reimbursement of the costs thereof. Net Proceeds of any insurance relating to damage or destruction to the Minimum Improvements or any portion thereof as a result of fire or other casualty in an amount estimated to equal or exceed $500,000 shall be payable to a trustee jointly agreed upon by the Company, the Authority and the Holder of the First Mortgage and shall be subject to such disbursement provisions as shall be jointly agreed by the Authority, the Company and the Holder of the First Mortgage. In the event the Minimum Improvements or any portion thereof is destroyed by fire or other casualty and the damage or destruction is estimated to equal or exceed $100,000, then the Com- pany shall within/done hundred eicihty (180) days after such damage or destruction, commence to repair, recon- struct and restore. the damaged Minimum Improvements to substantially the same or improved condition or utility value as they existed prior to the event causing such 5 - 3 damage or destruction and, to the extent necessary to accomplish such repair, reconstruction and restoration, the Company will apply the Net Proceeds of any insurance relating to such damage or destruction received by the Company from the Authority to the payment or reimburse- ment of the costs thereof. (e) The Company shall complete the repair, recon- struction and restoration of the Minimum Improvements, whether or not the Net Proceeds of insurance received by the Company for such purposes are sufficient to pay for the same. Any Net Proceeds remaining after completion of such repairs, construction and restoration shall be disbursed by the Authority to the Company. (f) Any other provision of this Section 5.1 not- withstanding, if temporary or permanent construction financing for the Minimum Improvements is funded with the proceeds of a public sale of Industrial Revenue Bonds issued by the City or the Authority, the Authority hereby agrees that, until such time as the Bonds and all interest and premium, if any, thereon shall be paid in full, the applicable provisions of the Loan Agreement (or any similar document) executed with respect to such Bonds shall control the payment, application and dis- bursement of any Net Proceeds of insurance with.respect to the Project. With respect to any other construction financing for the Minimum Improvements, application of proceeds of insurance shall be subject to the provisions of such intercreditor agreement or similar agreement as shall be approved by the Authority. This Subsection 5.1(f) notwithstanding, this Section 5.1 otherwise shall remain in full force and effect with respect to the Developers' obligations to maintain insurance, notify the Authority of any casualty thereto, and reconstruct the Minimum Improvements upon casualty, unless provision is made to the satisfaction of the Authority for the payment or discharge of the Tax Increment Bonds and reimbursement of all other public redevelopment costs incurred by the City and the Authority in connection with the Project. Section 5.2. Condemnation. (a) In the event that title to and possession of the Minimum Improvements or any material part thereof shall be taken in condemnation or by the exercise of the power of eminent domain by any governmental body or other person (except the Authority or the City) so long as either the Assessment Agreement shall remain in effect or there shall be any unpaid principal balance on the Promissory Note, the Company shall, with reasonable 5 - 4 promptness after such taking, notify the Authority as to the nature and extent of such taking. Upon receipt of any Condemnation Award the Company shall elect to either: (a) use the entire Condemnation Award to recon- struct the Minimum Improvements (or, in the event only a part of Minimum Improvements have -been taken, then to reconstruct such part) upon the Development Property or elsewhere within the Project Area; or (b) pay to the Authority out of the Condemnation Award, to the extent any such Condemnation Award is sufficient for such pur- pose: (i) if prior to the Termination Date, the present value of the sum of the real property taxes which would have been assessed upon the Improved Parcel between the date of such condemnation and the Termination Date, such calculation to be based upon (A) the Assessor's Minimum Market Value specified in the Assessment Agreement pur- suant to Section 6.1, and (B) the then -effective mill rate upon the date of such condemnation, such sum to be discounted to present value based upon (A) the number of years between the date of such condemnation and the Termination Date, and (B) the interest rate on the Prom- issory Note; and (ii) the outstanding Principal Balance of the Promissory Note, if any. (b) Any other provisions of the foregoing para- graph notwithstanding, if temporary or permanent con- struction financing for the Project is funded with the proceeds of a public sale of Industrial Revenue Bonds as discussed in Section 5.1(f), until such time as the principal, premium, if any, and interest on such Bonds shall have been paid in full, the proceeds of any Con- demnation Award received with respect to the Minimum Improvements shall be first paid, applied and disbursed as provided in the Loan Agreement (or any similar docu- ment) executed with respect to such Bonds, with any excess received by the Company to be applied as provided in the foregoing paragraph. With respect to any other construction financing for the Minimum Improvements, application of Net Proceeds of any condemnation award shall be subject to the provisions of such intercreditor agreement or similar agreement as shall be approved by the Authority. Section 5.3. Modification for Benefit of Mortgagees. In order to facilitate the obtaining of financing for the construction of the Minimum Improvements, the Authority agrees that it shall agree to any reasonable modification of this Articie V with respect to the disposition of the Net Proceeds of any insurance or any Condemnation Award to accommodate the interests of the Holder of the First Mort- gage; provided, however, that the Authority determines, in its reasonable judgment, that any such modification(s) will 5 - 5 adequately protect the legitimate interests and security of the Authority with respect to the Project and the Redevelop- ment Project. 5 - 6 ARTICLE VI Assessment Agreement Section 6.1. Execution of Assessment _Agreement. The Company shall agree to, and with the Authority shall exe- cute, prior to purchase of the Development Property by the Authority or reconveyance thereof to the Company, an Assess- ment Agreement pursuant to the provisions of Minnesota Stat- utes 273.76, Subdivision 8, specifying the Assessor's Mini- mum Market Value for the Improved Parcel for calculation of real property taxes, executed by the Company and the First MortV.gagee. If the Company has purchased the Development Property on a contract for deed, and the Assessment Agree- ment is executed prior to the. time fee title has vested in the Company, the Company shall cause the contract for deed vendor to join in the execution of the Assessment Agree- ment. Specifically, the Company shall agree to a market value for the Improved Parcel which will result in an assessed value as of January 2, 1986, of not less than Forty-one Million Dollars ($41,000,000)(such market value, the Assessor's Minimum Market Value). Nothing in the As- sessment Agreement shall limit the discretion of the asses- sor to assign a market value to the property in excess of such Assessor's Minimum Market Value nor prohibit the Com- pany from seeking through the exercise of legal or.admini- strative remedies a reduction in such market value for prop- erty tax purposes, provided however, that the Company shall not seek a reduction of such market value below the Assessor's Minimum Market Value in any year so long as the Assessment Agreement shall remain in effect. The Assessment Agreement shall remain in effect until December 31, 1994 (the "Termination Date"). The Assessment Agreement shall be certified by the Assessor for the City as provided in Minne- sota Statutes, Section 273.76'Subdivision 8, upon a finding by the Assessor that the Assessor's Minimum Market Value represents a reasonable estimate based upon the plans and specifications for the improvements to be constructed on the Development Property and the market value previously assigned to the Development Property. Pursuant to Minnesota Statutes, Section 273.76, Subdivision 8, the Assessment Agreement shall be filed for record in the office of the county recorder or registrar of titles of Scott County, and such filing shall constitute notice to any subsequent encum- brancer or purchaser of the Development Property, whether voluntary or involuntary, and such Assessment Agreement shall be binding and enforceable in its entirety against any such subsequent purchaser or encumbrancer, including the Holder of the First Mortgage. 6 - 1 Section 6.2. Real Property Taxes. (a) The Company shall pay all real property taxes payable with respect to the Development Property and pursuant to the provisions of the Assessment Agreement and any other statutory or -contractual duty which shall accrue subsequent to the date of its acquisition of title to the Development Property and until the Com- pany's -obligations have been assumed by any other person with the written consent of the Authority and pursuant to the provisions of this Agreement. (b) The Company agrees that prior to the Termina- tion Date: (i) It will not seek administrative review or judicial review of the applicability of any tax statute relating to the taxation of real property contained on the Development Property determined by any Tax Official to be applicable to the project or the Company or raise the inapplicability of any such tax statute as a defense in any proceedings, including delinquent tax proceedings; provided, however, "tax statute" does not include any local ordinance or resolution levying a tax; (ii) It will not seek administrative review or judicial review of the constitutionality of any tax statute relating to the taxation of real property contained on the Development Property determined by any Tax Official to be applicable to the project or the Company or raise the unconstitutionality of any such tax statute as a defense in any proceedings, including delinquent tax proceedings; provided, however, "tax statute" does not include any local ordinance or resolution levying a tax; (iii) It will not seek any tax deferral or abatement, either presently or prospectively autho- rized under Minnesota Statutes, Section 273.86, or any other State or federal law, of the taxation of real property contained in the Development Property between the date of execution of this Agreement and the Termination Date. Section 6.3.A Certain Cuaranties: Letter of Credit. (a) Letter of Credit. Prior to issuance of the Tax Increment Bonds or acquisition of the Development Property, the Company shall provide to the City an irre- vocable Letter of Credit securing payment of principal and interest on the Tax Increment Bonds. The Letter of 6 - 2 Credit shall be in an amount equal to either of the following amounts, at the option of the City: (i) the highest total of principal and interest which shall be payable with respect to the Tax Increment Bonds in any single calendar year, or (ii) eighty percent (80%) of the estimated annual ad valorem real estate taxes pay- able with respect to the Project, such calculation to be based "on the Assessor's Minimum Market Value and the 1985 mill rate for the City if available, or, if the 1985 mill rate is not available, the 1984 mill rate; provided, however, that in the event that the amount calculated pursuant to clause (i) is more than one hun- dred twenty percent (120%) of the amount calculated pursuant to clause (ii), the City shall require a Letter of Credit in the amount of clause (ii). The Company shall maintain the Letter of Credit at least through December 31, 1994; provided, however, that the Company may provide annual or other Letters of Credit having a lesser term in satisfaction of this Section 6.3(a) if each such Letter of Credit provides by its terms that it may be drawn upon in full if a replacement Letter of Credit meeting the requirements of this Section 6.3(a) has not been provided at least thirty (30) days prior to the expiration date of such Letter of Credit. The Letter of Credit shall be a single draw Letter of Credit, and shall provide that if the Company shall not timely pay any installment of ad valorem real estate taxes assessed with respect to the Development Property or any improvements thereon, and such default is not cured within thirty (30) days of receipt of written notice of such default by the Company and the bank issu- ing such Letter of Credit, the City shall be authorized to draw upon the Letter of Credit to the extent of its full face amount. The City agrees that it shall draw on the Letter of Credit prior to submitting any draw under any Guaranty provided pursuant to Section 6.3(b). The Letter of Credit shall be issued by a bank or financial institution reasonably acceptable to the City. The City must receive simultaneously with the Letter of Credit an opinion of counsel to the issuing bank or financial in- stitution addressed to the City to the effect that: (i) counsel is not aware of any facts or circumstances that would lead counsel to believe that the Letter of Credit is not a legally binding and valid obligation of the issuing bank or financial institution except to the ex- tent the enforcement of such obligation may be limited by laws relating to bankruptcy or reorganization of the issuing bank or financial institution or by other similar laws of general application affecting the rights of creditors or the issuing bank or financial institu- tion or by equitable remedies of the City or the Holders 6 - 3 of the Bonds against the issuing bank or financial in- stitution, (ii) the bank or financial institution issuing the Letter of Credit is organized and existing under the laws of the United States of America or applicable State law and (iii) the Letter of Credit qualifies as an obligation which the issuing bank or financial institution is permitted to issue under the laws of the United States of America or applicable State law. If the Tax Increment Bonds shall be refunded by the City, and if prior to such refunding the Letter of Credit has not been drawn upon, the Company shall be required to provide to the City a Letter of Credit with respect to the refunding bonds conforming in all re- spects with the provisions of this Section 6.3(a). (b) Guaranties. Additionally, prior to purchase of the Development Property by the Authority, the Com- pany shall be required to provide to the City personal and corporate guaranties (the "Guaranties"), as the case may be, securing payment of principal and interest on the Tax Increment Bonds from the following individuals and corporations: (cumulatively, the "Guarantors"). The Guaranties may be several and not joint but shall cumulatively be in an aggregate amount equal to the sum of (i) twenty-five percent (25%) of the principal amount of the Tax Increment Bonds and (ii) twenty-five percent (25%) of the interest payable on the Tax Increment Bonds to and including the stated maturity date thereof. The Guaranties shall provide that in the event that the Company shall not timely pay any install- ment of ad valorem real property taxes assessed with respect to the Development Property or any improvements thereon, and such default is not cured within thirty (30) days of provision of written notice to the Company and the Guarantors thereof, then each Guarantor shall pay to the City the full amount guaranteed pursuant to such Guaranty within five (5) days of receipt of a demand therefor from the City; provided, however, that if the City has submitted a draw and received payment under the Letter of Credit provided pursuant to Section 6.3(a), then each Guarantor shall be entitled to a credit against the amount guaranteed by such Guarantor equal to the product of (i) the ratio which the amount guaranteed by such Guarantor bears to the cumulative amount guaranteed under all the Guaranties, times (ii) the amount guaranteed by such Guarantor; and provided further, that if the City shall in no event seek to draw an aggregate amount under the Guaranties in excess of the sum of the remaining principal and interest payable 6 - 4 on the Tax Increment Bonds to the stated maturity thereof, less any amounts collected under the Letter of Credit and available therefor. (c) The City shall apply all funds collected under the Letter of Credit or the Guaranties for payment of principal and interest. on the Tax Increment Bonds as they shall become due. Section 6.4. Payment and Performance Bond. The Company shall furnish, or cause to be furnished, a payment and per- formance bond, in form and substance satisfactory to the Authority, to assure completion of the Project by the con- tractor. 6 - 5 ARTICLE VII Undertakings of the City and Authority; Tax Increment Bonds Section 7.1. Issuance of Tax Increment Bonds. The City and Authority agree that upon award of the Franchise to the Company, the City and the Authority shall take all steps necessary to issue and the City shall issue its Tax Incre- ment Bonds -in an amount sufficient to finance the City's and Authority's obligations to the Company hereunder, including purchase of the Development Property pursuant to the terms of Article III and construction and installation of the Offsite Improvements as provided in Section 7.2. Such steps shall include, but shall not be limited to, final approval of the Tax Increment District and submission to the Auditor of the County for certification of the original assessed value of the Tax Increment District. The City shall issue the Tax Increment Bonds at such time as shall be necessary and desirable to facilitate the Project and effect the pur- chase of the Development Property by the Authority, as mutu- ally agreed by the City, the Authority and the Company. The City's obligation to issue the Tax Increment Bonds shall be subject to the limitations provided in Section 7.3 hereof, but shall otherwise be unconditional. The Company agrees to act diligently and in good faith with the representatives of Miller & Schroeder Municipals, Inc. to structure an issue of Tax Increment Bonds payable solely from specified revenues including the tax increment generated by the Project and not secured by the full faith and credit of the City. However, if such a revenue bond issue shall not prove feasible, the City agrees that it shall issue the Tax Increment Bonds as general obligation bonds of the City. Section 7.2. Provision of Offsite Improvements. As consideration for the execution of this Agreement and con- struction of the Minimum Improvements by the Company, the City and the Authority agree to undertake and finance the following public development costs of improvements located within the Redevelopment Project but off the Development Property (the Offsite Improvements"), provided that the City and Authority shall have no obigation to spend in excess of $2,900,000 to construct the Offsite Improvements, and fur- ther provided that the Company has caused all related par- ties to it, including any shareholders in the Company or general partners in any affiliated partnerships, to (i) dedicate such land as is owned by such related parties as is necessary for the construction of the Offsite Improvements to the City without cost and (ii) execute, to the extent such related persons are the owners of benefitting proper- ties, special assessment agreements providing for (A) reim- 7 - 1 bursement of 73% of the construction cost of the Offsite Improvements listed in clause (d) below (estimated to be approximately $420,000), and (B) reimbursement of 38% of the construction cost of the Offsite Improvements Jisted in clause Aub. below (estimated to be approximately 85,550 , such special assessment agreements to be subject to the terms provided below: (d) Construct previously planned four Total Estimated Improvement Type Construction Cost (a) Signalization and intersection upgrading at Valley Park Drive (e) Construct previously planned four and TH 101 $ 220,000 (b) Signalization and intersection upgrading at TH 101 and CR 83 180,000 (c) Signalization and intersection design roadway from TH 101 to north upgrading at north -south collector 185,000 (g) street and TH 101 215,000 (d) Construct previously planned four lane, 9 -ton, urban design (excluding storm sewer) Valley Industrial Park east -west roadway between Valley Park Drive and CR 83 575,000 (e) Construct previously planned four lane, 9 -ton, urban design north - south collector street from TH 101 south to 4th Avenue 225,000 (f) Widen CR 83 to a four lane, urban design roadway from TH 101 to north entrance to racetrack 185,000 (g) Widen and overlay Valley Park Drive to a four lane, 9 -ton, urban/rural roadway from TH 101 to proposed east - west roadway intersection (including 1,000 -foot urban extension) 345,000 (h) Widen and overlay Fourth Avenue to a two lane, 9 -ton, rural design roadway from CR 83 to the proposed north - south collector street including right -turn and gravel shoulders 274,000 (i) Intersection improvements and signal revisions at TH 101 and CR 18 90.000 Total Construction Cost: $2,309,000 7 - 2 (j) Engineering, Legal and Contingency Costs 390,000 (k) Additional right-of-way cost for property not owned by the Company or any related parties thereto 150,000 GRAND TOTAL: $2,849,000 All costs of the Offsite Improvements in excess of $2,900,000 shall be the obligation of the Company unless otherwise agreed. Any special assessment agreements exe- cuted pursuant to this Section 7.2 shall be subject to the following terms: (i) payment of any assessment levied upon unimproved property shall be deferred, subject to the appli- cable provisions of law, until the construction of improve- ments on the properties assessed, and (ii) no interest shall accrue with respect to any deferred payments during the deferral period, and shall thereafter accrue and be payable in the manner provided in the resolution authorizing such assessments. The City and the Authority shall construct the Offsite Improvements as necessary to coincide with construc- tion of the Minimum Improvements by the Company; in this regard, the Company shall keep the City and Authority notified as to construction progress on the Minimum Improve- ments. The obligation of. the City and the Authority to construct and install the Offsite Improvements shall addi- tionally be subject to the provisions of Section 7.3. Section 7.3. Limitations on Financial Undertakings of the City. The provisions of Sections 7.1 and 7.2 notwith- standing, neither the City nor the Authority shall have any obligation to the Company under this Agreement to issue the Tax Increment Bonds or to commence or continue construction of the Offsite Improvements except upon the continuing exis- tence of the following condi,tions: (i) The Company has been awarded the Franchise and the Franchise remains in good standing and no material and meritorious litigation has been commenced and is continuing with respect to the Franchise or the Company which, if resolved unfavorably to the Company, would result either in revocation of the Franchise or in the inability of the Company to proceed with the Project; (ii) The City and the Authority are not entitled under Section 10.02 to exercise any of the remedies set forth therein as a result of an Event of Default; and (iii) There has not been, nor does there occur, a substantial change for the worse in the financial re - 7 - 3 sources and ability of the Company, or a substantial decrease in the financing commitments secured by the Company for construction of the Minimum Improvements, which change(s) makes it substantially more likely, in the reasonable judgment of the City and the Authority, that the -Company will be unable to fulfill its covenants and obligations under this Agreement. Section. -7.4. Use of Tax Increments. The Authority shall be free to use any tax increments received from the Tax Increment District for any purpose, consistent with any covenants made with respect to the Tax Increment Bonds, for which such increments may lawfully be used pursuant to the provisions of Minnesota Statutes, Chapter 462 and Section 273.75, subd. 4, and the Authority shall have no obligations to the Company with respect to the use of such increment. 7 - 4 ARTICLE VIII Mortgage Financing Section 8.1. Limitation Upon Encumbrance of Property. Prior to -the completion of the Minimum Improvements, as certified by the Authority, neither the Company nor any successor in interest to the Development Property or any part thereof shall engage in any financing or any other transaction creating any mortgage or other encumbrance or lien upon the Development Property, other than Permitted Encumbrances, whether by express agreement or operation of law, or suffer any encumbrance or lien to be made on or attach to the Development Property, other than Permitted Encumbrances, except the Authority Mortgage, except: (a) for the purposes of obtaining funds only to the extent necessary for making the Minimum Improvements (including, but not limited to, labor and materials, equipment, professional fees, real estate taxes, con- struction interest, organizational and other indirect costs of development, costs of constructing the Minimum Improvements, an allowance for contingencies, land ac- quisition cost of the Development Property, costs of issuance of any bond issue to fund construction or ac- quisition of the Project, amounts required to fund any bond reserves relating to construction or acquisition of the Project, and amounts required to fund any required escrow accounts); and (b) only upon the prior written approval of the Authority in accordance with Sections 8.1 and 8.2. The Authority shall not approve any Mortgage which does not contain terms that conform to the terms of Section 8.5, except as provided in Section 8.6 of this Agreement. Section 8.2. Approval of Mortgage. The Authority shall approve a Mortgage if: (a) the Authority first receives a copy of all mortgage documents; (b) the mortgage loan, together with other funds available to the Company, will, in the reasonable judg- ment of the Authority, be sufficient to construct the Minimum Improvements; (c) the Authority and the City are not entitled under.Section 10.02'to exercise any of the remedies set forth therein as a result of an Event of Default; and 8 1 (d) the Authority determines that the terms of the Mortgage conform to the terms of Section 8.5. However, the approval of a mortgage by the Authority shall not be unreasonably withheld. Any Mortgage which is sub- ordinated -to the rights of the Authority Mortgage may be granted in all or any part of the Development Property with- out the approval of the Authority. Section 8.3. Notice of Default; Copy to Mortgagee. Whenever the Authority shall deliver any notice or demand to the Company with respect to any breach or default by the Company in its obligations or covenants under the Agreement, the Authority shall at the same time forward a copy of such notice or demand to each Holder of any Mortgage authorized by the Agreement at the last address of such Holder shown in the records of the Authority. Section 8.4. Mortgagee's Option to Cure Defaults. After any breach or default referred to in Section 8.3, each such Holder shall (insofar as the rights of the Authority are concerned) have the right, at its option, to cure or remedy such breach or default (or such breach or default to the extent that it relates to the part of the Development Property covered by its mortgage) and to add the cost thereof to the Mortgage debt and the lien of its Mortgage; provided, however, that if the breach or default is with respect to construction of the Minimum Improvements, nothing contained in this Section or any other Section of this Agreement shall be deemed to require such Holder, either before or after foreclosure or action in lieu thereof, to undertake or continue the construction or completion of the Minimum Improvements (beyond the extent necessary to con- serve or protect Minimum Improvements or construction al- ready made), provided that any such Holder shall not devote the Development Property to a use inconsistent with the Development Plan or this Agreement without the agreement of the Authority. Section 8.5. Authority's Option to Cure Default on Mortgage. Any Mortgage (other than the Authority Mortgage) executed by the Company with respect to the Development Property or any improvements thereon shall provide that, in the event that the Company is in default under any Mortgage authorized pursuant to this Article VIII, the Holder shall notify the Authority in writing of: (-a) the fact of the default; (b) the elements of the default; and (c) the actions required to cure the default. 8 - 2 If the default is an "Event of Default" under such Mortgage, which shall entitle such Holder to foreclose upon the Devel- opment Property, the Minimum Improvements or any portion thereof, and any applicable grace periods have expired, the Authority shall have, and each Mortgage executed by the Company with respect to the Development Property or any improvements thereon shall provide that the Authority shall have such an opportunity to cure the "Event of Default" within such reasonable time period as the Holder shall deem appropriate. Section 8.6. Subordination and Modification for the Benefit of Mortgagees. (a) In addition to -the subordination of the Authority Mortgage as provided in Section 3.4(d), in order to facilitate the obtaining of financing for the construction of the Minimum Improvements by the Company, the Authority agrees to subordinate its rights under the Development Property Deed and this Agreement to the Holder of the First Mortgage for the purposes described in Section 8.1(a) of this Agreement, but only provided that the First Mortgage provides that if the Holder of the First Mortgage shall foreclose on the Development Property, the improvements thereon, or any portion thereof, or accept a deed to the Development Property in lieu of foreclosure, it shall consent to the Assessor's Minimum Market Value set forth in the Assessment Agree- ment. (b) In order to facilitate the obtaining of fin- ancing for the construction of the Minimum Improvements, the Authority agrees that it shall agree to any reason- able modification of this Article VIII or waiver of its rights hereunder to accommodate the interests of the Holder of the First Mortgage, provided, however, that the Authority determines, in its reasonable judgment, that any such modification(s) will adequately protect the legitimate interests and security of the Authority with respect to the Project and the Redevelopment Plan. The Authority also agrees to consider such modi- fication(s) of this Article VIII with respect to other Holders, and to agree to such modifications if the Authority deems such modification(s) necessary and rea- sonable. 8 - 3 ARTICLE IX Prohibitions Against Assignment and Transfer; Indemnification Section 9.1. Status- of Company; Transfer of Substan- tially All Assets. As security for the obligations of the Company under this Agreement and the Promissory Note, the Company represents and agrees that prior to the Termination Date, the Company will maintain its existence as a Minnesota corporation and shall not consolidate with or merge into another corporation and shall not dissolve or otherwise dis- pose of all or substantially all of its assets; provided that the Company may consolidate with or merge into another corporation or sell or otherwise transfer to a partnership or corporation organized under the laws of one of the United States, or an individual, all or substantially all of its assets as an entirety and thereafter dissolve and be dis- charged from liability hereunder if (i) the transferee part- nership, corporation or individual assumes in writing all of the obligations of the Company under this Agreement and the Assessment Agreement; and (ii) the Authority receives new guarantees of the successor Company's obligations to pay ad valorem real property taxes with respect to the Project and to pay principal and interest on the Promissory Note con- sistent with the requirements of Section 6.3 or receives such evidence as the Authority shall reasonably require, including an opinion of counsel, that the existing guaran- tees provided pursuant to Section 6.3 will remain in effect and will be enforceable against the Guarantors upon a de- fault by the successor Company with respect to payment of the Promissory Note or ad valorem real property taxes with respect to the Project. Section 9.2. Prohibition Against Transfer of Property and Assignment of Agreement. For the foregoing reasons the Company represents and agrees that prior to the Termination Date: (a) Except only by way of security for, and only for, the purpose of obtaining financing necessary to enable the Company or any successor in interest to the Development Property, or any part thereof, to perform its obligations with respect to making the Minimum Im- provements under this Agreement, and any other purpose authorized by this Agreement, the Company has not made or created and will not make or create or suffer to be made or created any total or partial sale, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to the Agreement or the Development Property (other than Per- mitted Encumbrances) or any part thereof or any interest 9 - 1 therein, or any contract or agreement to do any of the same, without the prior written approval of the Authority_; provided, however, that the Company shall be free to convev the portion of the Development Property legally described as follows without the approval of the Authority and upon- such terms as the Company shall de- sire. and further provided that minor deviations in t_h-e- legal description ' of the parcel actually transferred from the following description shall not affect this_ (b) The Authority shall be entitled to require, except as otherwise provided in the Agreement, as condi- tions to any such approval that: (i) Any proposed transferee shall have the qualifications and financial responsibility, in the reasonable judgment of the Authority, necessary and adequate to fulfill the obligations undertaken in this Agreement by the Company. (ii) Any proposed transferee, by instrument in writing satisfactory to the Authority and in form recordable among the land records, shall, for it- self and its successors and assigns, and expressly for the benefit of the Authority, have expressly assumed all of the obligations of the Company under this Agreement and agreed to be subject to all the conditions and restrictions to which the Company is subject (unless the Company agrees to continue to fulfill those obligations, in which case the pre- ceding provisions of this Section 9.2(b)(ii) shall not apply); provided, however, that the fact that any transferee of, or any other successor in inter- est whatsoever to, the Development Property, or any part thereof, shall not, for whatever reason, have assumed such obligations or so agreed, shall not (unless and only to the extent otherwise specifi- cally 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 the construction of the Minimum Improvements; it being the intent of the Parties as expressed in this Agreement that (to the fullest extent permitted at law and in equity and excepting only in the manner and to the extent specifically provided otherwise in this Agreement) no transfer of, or change with respect to, owner- ship in the Development Property or any part thereof, or any interest therein, however consum- mated or occurring, and whether voluntary or invol- untary, shall operate, legally or practically, to deprive -or limit the Authority of or with respect to any rights or remedies or controls provided in or resulting from this Agreement with respect to the_ Development Property and the construction of the Minimum Improvements that the Authority would have had, had there been no such transfer or change. In the absence of specific written agree- ment by the Authority to the contrary, no such transfer or approval by the Authority thereof shall be deemed to relieve the Company, or any other party bound in any way by this Agreement or other- wise with respect to the construction of the Mini- mum Improvements, from any of its obligations with respect thereto. (iii) There shall be submitted to the Authority for review and prior written approval all instru- ments and other legal documents involved in effec- ting the transfer of any interest in this Agreement or the Development Property governed by this Arti- cle IX. Section 9.3. Release and Indemnification Covenants. (a) The Company releases the Authority and the City and the governing body members, officers, agents, servants and employees thereof (hereinafter, for pur- poses of this Section 9.3, the "indemnified parties") from, covenants and agrees that 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 de- fect in the Project_;i3rovided that nothing herein shall require the Company to indemnifv the indemnified parties as to the consequences of any negligent or wrongful act _of any of thg ind mnifipd narties, their o fi ars -agents, servants or employees (b) Except for any willful misrepresentation or any willful or wanton misconduct or any unlawful act of the indemnified parties, the ,Company agrees to protect and defend the indemnified parties, now or forever, and further agrees to hold the indemnified parties harmless, from any claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising (i) from any violation of any agree - 9 - 3 ment or condition of this Agreement (except with respect to any suit, action, demand or other proceeding brought by the Company against the City or the Authority to enforce its rights under this Agreement) or (ii) the acquisition, construction, installation, ownership, and operation of the Project. (c) 'The indemnified parties shall not be liable for any . damage or injury to the persons or property of the Company or its officers, agents, servants or em- ployees or any other person who may be about the Project due to any act of negligence of any person, other than any act of negligence on the part of any such indemni- fied party or its officers, agents, servants or employ- ees. (d) All covenants, stipulations, promises, agree- ments and obligations of the Authority and the City _ contained herein shall be deemed to be the covenants, y stipulations, promises, agreements and obligations of the Authority and the City, respectively, and not of any governing body member, officer, agent, servant or em- ployee of the Authority or the City in the individual capacity thereof. Section 9.4. Approvals. Any approval of a transfer of interest in the Company, this Agreement, or the Development Property required to be given by the Authority under this Article IX may be denied only in the event that the Author- ity reasonably determines that the ability of the Company to perform its obligations under this Agreement, or the overall _ financial security provided to the Authority under the terms of this Agreement, or the likelihood of the Minimum Improve- ments being successfully constructed and operated pursuant to the terms of this Agreement, will be materially impaired by the action for which approval is sought. 9 - 4 ARTICLE X Events of Default Section 10.1. Events of Default Defined. The following shall be "Events of- Default" under this Agreement and the term "Event of Default" shall mean whenever it is used in this Agreement any one or more of the following events: (a) Failure by the Company to timely pay pursuant to Article VI all ad valorem real property taxes assessed with respect to the Development Property, or to provide or maintain the Letter of Credit or the Guaran- ties required by Sections 6.3 or 6.4. (b) Failure by the Company to provide the Promis- sory Note as required by Section 3.4, or to pay when due any payment of principal or interest on the Promissory Note; (c) Failure by the Company to commence and com- plete construction of the Minimum Improvements pursuant to the terms, conditions and limitations of Article IV. (d) Failure by the Company to reconstruct the Minimum Improvements when required pursuant to Sections 5.1 and 5.2. (e) Transfer of any interest in the Company or the Project in violation of the provisions of Article IX. (f) Failure by the Company to substantially ob- serve or perform any material covenant, condition, obli- gation or agreement on its part to be observed or per- formed under this Agreement. (g) 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. Section 10.2. Remedies on Default. Subject to the provisions of Section 10.8, whenever any Event of Default referred to in Section 10.1 occurs and is continuing, the Authority or the City, as specified below, may take any one or more of the following actions after provision of thirty (30) days' written notice to the Company and the Holder of the First Mortgage of the Event of Default by the Authority, but only if the Event of Default has not been cured within said thirty (30) days, or if the Event of Default cannot be cured within thirty (30) days and the Company does not pro- vide assurances to the Authority and the City reasonably 10 - 1 satisfactory to the Authority and the City that the Event of Default will be cured as soon as reasonably possible: (a) The Authority and the City may suspend their performance under this Agreement until they receive assurances from the Company, deemed adequate by the Authority and the City, that the Company will cure its default and continue its performance under this Agree- ment. (b) If prior to purchase of the Development Prop- erty by the Authority, the Authority and the City may cancel and rescind the Agreement. (c) The Authority may withhold the Certificate of Completion. (d) If the Event of Default is a failure to make payments required by Article III, the Authority may declare the outstanding principal balance of the Promis- sory Note, together with all accrued and unpaid inter- est, immediately due and payable. (e) The Authority may draw upon any guarantee pro- vided to the Authority pursuant to any of the terms of this Agreement according to its terms. (f) The Authority and/or the City may take any action, including legal or administrative action, which may appear necessary or desirable to collect any pay- ments due under this Agreement, or to enforce perfor- mance and observance of any obligation, agreement, or covenant of the Company under this Agreement. Section 10.3. Revesting Title in the Authority Upon Happening of Event Subsequent to Conveyance to the Com- pany. In the event that subsequent to reconveyance of the Development Property or any part thereof to the Company by the Authority and prior to receipt by the Company of the Certificate of Completion, and subjedt to the terms of any First Mortgage: (a) the Company shall fail to begin construction of the Minimum Improvements in conformity with this Agreement, such failure is not due to Unavoidable Delays and such failure to begin construction shall not be cured within sixty (60) days after written notice to do so; or (b) the Company shall, after commencement of the construction of the Minimum Improvements, default in or violate its obligations with respect to the construction .10 - 2 of the Minimum Improvements, or shall abandon or sub- stantially suspend construction work, such act or ac- tions are not due to Unavoidable Delays and any such default, violation, abandonment, or suspension shall not be cured within ninety (90) days after written demand by the Authority to do so; or J4LcL there is, in violation of this Agreement, any transfer of the Development Property or any part thereof, and such violation shall not be cured within ninety (90) days after written demand by the Authority to the Company; or (d the Holder of any Mortgage commences fore- closure proceedings as a result of any default under the applicable Mortgage documents; however, any such action by a Holder shall not constitute cause for the Authority to reenter upon the Development Property under this Section 10.3 if such Holder, or such Holder jointly with the Company: (i) assumes all obligations and covenants of the Company under this Agreement; and (ii) executes with the Authority an indemnification agreement with sufficient collateral to indemnify the Authority fully for any loss the Authority might suffer through failure to exercise their remedies under this Agreement; then the Authority shall have the right to re-enter and take possession of the Development Property and to terminate (and revest in the Authority pursuant to the provisions' of this Section 10.3 subject only to any superior rights in any Holder acquiesced in by the Authority pursuant to Section 8.6) the estate conveyed by the Development Property Deed to the Company, it being the intent of this provision, together with other provisions of this Agreement, that the conveyance of the Development Property to the Company shall be made upon the condition that, and that the Development Property Deed shall contain a condition subsequent to the, effect that, in the event of any default under this Section 10.3 on the part of the Company and failure on the part of the Com- pany to cure such default within the period and in the man- ner stated in such subdivision, the Authority may declare a termination in favor of the Authority of the title and of all the Company's rights and interests in and to the Devel- opment Property conveyed to the Company, and that such title and all rights and interests of the Company, and any assigns or successors in interest to and in the Development Prop- erty, shall revert to the Authority (subject to the provi- sions of Sectio10.4)-, bu-t only if the events stated in Section 10.3(a)4 have not been cured within the time period provided above, or, if the events cannot be cured within such time periods, the Company does not provide assurances to the Authority, satisfactory to the Authority, 10 - 3 that the events will be cured as soon as reasonably pos- sible. Section 10.4. Resale of Reacquired Property; Disposi- tion of Proceeds. Upon the revesting in the Authority of title to the Development Property or any part thereof as provided in Section 10.3, the Authority shall, pursuant to its: responsibilities under law, use its best efforts, sub- ject to any__rights or interests in such property or resale granted to any Holder pursuant to Section 8.6 and previously acquiesced to by the Authority, to resell the Development Property or part thereof as soon and in such manner as the Authority shall find feasible and consistent with the objec- tives of such law and of the Redevelopment Plan to a quali- fied and responsible party or parties (as determined by the Authority in its sole discretion) who will assume the obli- gation of making or completing the Minimum Improvements or such other improvements in their stead as shall be satis- factory to the Authority and in accordance with the uses specified for such Development Property or part thereof in the Redevelopment Plan. Subject to any rights or interests in such property or proceeds granted to any Holder pursuant to Section 8.6 and previously acquiesced to by the Author- ity, upon such resale of the Development Property the pro- ceeds thereof shall be applied: (a) First, to pay all unpaid real estate taxes which have or shall become due and payable with respect to the Development Property and improvements thereon in the calendar year in which the Development Property is resold, and to pay any and all delinquent real estate taxes, including any interest and penalties accrued thereon, unpaid upon the date of resale of the Develop- ment Property; (b) Second, to pay the principal and interest on any Mortgage(s) created on the Development Property, or any portion thereof, or any improvements thereon, pursu- ant to Article VIII. If more than one Mortgage on the Development Property, or any portion thereof, or any improvements thereon, is created pursuant to Article VIII, and insufficient proceeds of the .resale exist to pay the principal of, and interest on, each such Mort- gage in full, then such proceeds of the resale as are available shall be used to pay the principal of and interest on each such Mortgage in their order of prior- ity, or by mutual agreement of all contending parties including the Company, o -r by operation of law; (c) Third, to reimburse the Authority, on its own behalf or on behalf of the City, for all allocable costs and expenses incurred by the Authority or the City, 10 - 4 including but not limited to salaries of personnel, in connection with the recapture, management and resale of the Development Property or part thereof (but less any income derived by the Authority from the property or part thereof in connection with such management); any payments made or necessary to be made to discharge any encumbrances or liens (except for Mortgages) existing on the Development Property or part thereof at the time of revesting of title thereto in the Authority or to dis- charge or prevent from attaching or being made any sub- sequent encumbrances or liens due to obligations, de- faults or acts of the Company, its successors or trans- ferees (except with respect to Mortgages); any expendi- tures made or obligations incurred with respect to the making or completion of the Minimum Improvements or any part thereof on the Development Property or part thereof; and any amounts otherwise owing to the City or to the Authority (including water and sewer charges) by the Company and its successors or transferees; the Authority shall reimburse any moneys retained by the Authority on behalf of the City under this Section 10.4(c) to the City within 30 days of the date of final distribution of the proceeds of sale of the Development Property pursuant to this Section 10.4; and (d) Fourth, to reimburse the Company up, to the amount equal to (i) the sum of the Repurchase Price paid to the Authority for the Development Property (or allo- cable to the part thereof) and the cash actually in- vested by the Company in making any of the Minimum Im- provements on the Development Property or part thereof, less (ii) any gains or income withdrawn or made by it from this Agreement or the Development Property. Any balance remaining after such reimbursements shall be retained by the Authority as its property. Section 10.5. No Remedy Exclusive. No remedy herein conferred upon or reserved to the Authority 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 stat- ute. 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 10.6. No Additional Waiver Implied by One Wai- ver. In the event any agreement contained in this Agreement should be breached by any Party and thereafter waived by any 10 - 5 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 10.7. Agreement to Pay Attorney's Fees and Expenses. Whenever any Event of Default occurs and the Authority shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement or performance or observance of any obligation or agreement on the part of the Company herein contained, the Company agrees that it shall, on demand therefor, pay to the Authority the reasonable fees of such attorneys and such other expenses so incurred by the Authority. Section 10.8. Non -Recourse Obligations. It is recog- nized that the Promissory Note and the Authority Mortgage and other obligations hereunder are non-recourse obligations of the Company, that as a result thereof this Agreement is not intended to create any personal liability for the "debt" authorized to be created, and that accordingly the remedies available to the City and the Authority upon an Event of Default insofar as they relate to the payment of any obliga- tions hereunder are limited to the rights and remedies against the Development Property and such other security to secure the obligations as are given the City and the Author- ity under the guarantees required by Section 6.3. - . ARTICLE XI Additional Provisions Section 11.1. Restrictions on Use. The Company agrees for itself, its successors and assigns and every successor in interest to the Development Property, or any part thereof, that the Company and such successors and assigns shall devote the Development Property to, and only to, and in accordance with, the uses specified in the City Code, or in the Redevelopment Plan, or in this Agreement. Section 11.2. Conflicts of Interest. No member of the governing body or other official of the Authority or the City shall have any financial interest, direct or indirect, in this Agreement, the Improved Parcel, 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 partici- pate in any decision relating to the Agreement which affects his or her personal interests or the interests of any corpo- ration, partnership or association in which he or she is, directly or indirectly, interested. No member, official or employee of the Authority or the City shall be personally liable to the Company in the event of any default or breach by the Authority or for any amount which may become due to the Company or successor or on any obligations under the terms of this Agreement. Section 11.3. Provisions Not Merged With Deed. None of the provisions of this Agreement shall be merged by reason of any deed transferring any interest in the Development Property and any such deed shall not be deemed to affect or impair the provisions and covenants of this Agreement. Section 11.4. 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 11.5. 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, (a) in the case of the Company is addressed to or delivered personally to Minnesota Racetrack, Inc. at 5248 Valley Industrial Boulevard South, Shakopee, Minne- sota 55379, Attention: President; (b) in the case of the Authority, is addressed to or delivered personally to the Authority at 129 E. 1st Avenue, Shakopee, Minnesota 55379, Attention: Executive Director of the Housing and Redevelopment Authority; (c) in the case of the City, is addressed to or delivered personally to the City at 129 E. 1st Avenue, Shakopee, Minnesota 55379, Attention: Mayor. (d) in the case of the Holder of the First Mort- gage, is addressed or delivered personally to an address to be supplied; 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 11.6. Counterparts. This Agreement is executed in any number of counterparts, each of which shall consti- tute one and the same instrument. Section 11.7. Modification. If the Company is re- quested by the Holder of a" Mortgage or by a prospective Holder of a prospective Mortgage to amend or supplement this Agreement in any manner whatsoever, the Authority will, in good faith, consider the request with a view to granting the same unless the Authority, in its reasonable judgment, con- cludes that such modification is not in the public interest, or will significantly and undesirably weaken the financial security provided to the interests of the Authority by the terms and provisions of this Agreement. Section 11.8. Law Governing. This Agreement will be governed and construed in accordance with the laws of the State. Section 11.9. Legal Opinions. Upon execution of this Agreement, each party shall supply the other parties with an opinion of its legal `counsel to the effect that this Agree- ment is legally issued or executed by, and valid and binding upon, such party, and enforceable in accordance with its terms. 11 - 2 ARTICLE XII Termination of Agreement Section 12.1. The Company's Options to Terminate. This Agreement may be terminated by the Company if (i) the Com- pany is in compliance with all material terms of this Agree- ment and no Event of Default has occurred; and (ii) the Authority fails to comply with any material term of this Agreement, and, after written notice by the Company of such failure, the Authority has failed to cure such non-compli- ance within ninety (90) days of receipt of such notice, or, if such non-compliance cannot reasonably be cured by the Authority within ninety (90) days, the Authority has not, within ninety (90) days of receipt of such notice, provided assurances, reasonably satisfactory to the Company, that such non-compliance will be cured as soon as reasonably possible. Section 12.2. The City's and Authority's Options to Terminate. The City and the Authority may, at their option and by mutual consent with each other, terminate this Agree- ment if (i) the Franchise is awarded to an applicant other than the Company, or (ii) the Franchise is not awarded prior to January 1, 1985, or, in the event of Unavoidable Delays, January 1, 1987. Section 12.3. Action to Terminate. Termination of this Agreement pursuant to Section 12.1 or 12.2 must be accom- plished by written notification by the terminating Party or Parties, as the case may be, to all other Parties within thirty (30) days after the date when such option to termi- nate may first be exercised. A failure to terminate this Agreement within such period constitutes a waiver of the rights to terminate this Agreement due to such occurrence or event. Section 12.4. Effect of Termination. If this Agreement is terminated pursuant to this Article XII, 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 Agree- ment by the other party, or to recover amounts (including payments of principal and interest on the Promissory Note, fees, charges or reimbursements) which had accrued and be- come due and" payable as of the date of such termination. Upon termination of this Agreement pursuant to this Article XII, the Authority shall release all guarantees delivered to the Authority pursuant to the terms of this Agreement, and the Company shall be free to proceed with the Project at its 12 - 1 own expense and without regard to the provisions of this - Agreement; provided, however, that the Authority shall have no further obligations to the Company with respect to the = acquisition or sale of the Development Property. IN WITNESS WHEREOF, the Authority has caused this Agree- ment to be duly executed in its name and on its behalf and its seal to be hereunto duly affixed, and 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 Company has caused this Agreement to be duly executed in its name and on its behalf, on or as of the date first above written. 12 - 2 [This is a signature page to the Amended Contract for Pri- vate Development, dated June , 1984, by and among the City of Shakopee, Minnesota, the Housing and Redevelopment Authority in and for the City of Shakopee, Minnesota, and Minnesota Racetrack, Inc.] HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF SHAKOPEE, MINNESOTA (SEAL) By_ Chairman yChairman And Secretary 12 - 3 [This is a signature pe to the Amended Contract for Pri- vate Development, dated June 1984, by and among the City of Shakopee, Minnesota, the Housing and Redevelopment Authority in and for the City of Shakopee, Minnesota, and Minnesota Racetrack, Inc.] MINNESOTA RACETRACK, INC. By Its President 12 - 4 (This is a signature page to the Amended Contract for Pri- vate Development, dated/June , 1984, by and among the City of Shakopee, Minnesota, tne Housing and Redevelopment Authority in and for the City of Shakopee, Minnesota, and Minnesota Racetrack, Inc.] (SEAL) CITY OF SHAKOPEE, MINNESOTA By Mayor By City Clerk 12 - 5 STATE OF MINNESOTA) )ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of 1 1984, by and , the Chairman and Secretary, respectively, of the Housing and Redevelopment Authority in and for the City of Shakopee.,_.Minnesota, a political subdivision of the State of Minnesota, on behalf of the Authority. Notary Public 12 - 6 STATE OF MINNESOTA) )ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of 1984, by , the Presi- dent of Minnesota Racetrack, Inc., a corporation organized under the laws of Minnesota, on behalf of the partnership. Notary Public 12 - 7 STATE OF MINNESOTA) COUNTY OF )ss.) The foregoing instrument was acknowledged before me this day of 01 1984, by and , the Mayor and City Clerk, respectively, of the City of Shakopee, Minnesota, a municipal corporation and political subdivision organized and existing under the Constitution and laws of the State of Minnesota, on behalf of the City. Notary Public 12 - 8 EXHIBIT A (Development Property) The Northeast Quarter of the Southeast Quarter of Section 5, Township 115, Range 22, Scott County, Minnesota excepting therefrom: The West 150.00 feet of the north 333.00 feet of the Northeast Quarter of the Southeast Quarter of Section 5, Township 115, Range 22. The South Half of the Southeast Quarter of Section 5, Town- ship 115, Range 22, Scott County, Minnesota. The Southwest Quarter of the Southwest Quarter of Section 4, Township 115, Range 22, Scott County, Minnesota. _. That part of the East Half of the Northeast Quarter of Sec- { tion 8, Township 115, Range 22, Scott County, Minnesota, lying northerly of the centerline of County Road No. 16. The Northwest Quarter of Section 9, Township 115, Range 22, Scott County, Minnesota excepting therefrom: The south 400 feet of the west 100 feet of the South Half of the'Northwest Quarter. n A - 1 EXHIBIT B CERTIFICATE OF COMPLETION AND RELEASE OF FORFEITURE WHEREAS, the Housing and Redevelopment Authority in and for the City of Shakopee, Minnesota (the "Grantor"), a pub- lic body corporate and politic, by a Deed recorded in the Office of the County Recorder or the Registrar of Titles in and for the.County of Scott and State of Minnesota, as Deed Document Number , has conveyed to Minnesota Race- track, Inc., a Minnesota corporation (the "Grantee"), the following described land (the "Development Property") in the County of Scott and State of Minnesota, to wit: The Northeast Quarter of the Southeast Quarter of Section 5, Township 115, Range 22, Scott County, Minnesota excepting therefrom: The West 150.00 feet of the north 333.00 feet of the Northeast Quarter of the Southeast Quarter of Section 5, Township 115, Range 22. The South Half of the Southeast Quarter of Section 5, Township 115, Range 22, Scott County, Minnesota. The Southwest Quarter of the Southwest Quarter of Section 4, Township 115, Range 22, Scott County, Minnesota. That part of the East Half of the Northeast Quarter of Section 8, Township 115, Range 22, Scott County, Minnesota, lying northerly of the centerline of County Road No. 16. The Northwest Quarter of Section 9, Township 115, Range 22, Scott County, Minnesota excepting there- from: The south 400 feet of the west 100 feet of the South Half of the Northwest Quar- ter. and WHEREAS, said Deed incorporated and contained certain covenants and restrictions, the breach of which by the Gtantee, its successors and assigns, would result in a for- feiture and right of re-entry by the Grantor, its successors and assigns, said covenants and restrictions being set forth in said Deed and in a Contract For Private Development, executed by and among the Grantor, the Grantee and the City B - 1 of Shakopee, Minnesota, and dated June , 1984 (the "De- velopment Agreement"); and WHEREAS, the Grantee has to the present date performed said covenants and conditions insofar as it is able in a manner deemed sufficient by the Grantor to permit the execu- tion and recording of this certification; NOW, THEREFORE, this is to certify that all building construction and other physical improvements specified to be done and made by the Grantee have been completed and the above covenants and conditions in said Deed and Development Agreement have been performed by the Grantee therein and that the provisions for forfeiture of title and right to re- entry for breach of condition subsequent by the Grantor, contained therein, are hereby released absolutely and for- ever insofar as they apply to the land described herein, and the County Recorder or the Registrar of Titles in and for the County of Scott and State of Minnesota is hereby autho- rized to accept for recording and to record the filing of this instrument, to be a conclusive determination of the satisfactory termination of the covenants and conditions of the contract referred to herein which would result in a forfeiture by the Grantee, its successors and assigns, and right of re-entry in the Grantor, its successors and assigns, as set forth in said Deed, and that said Deed shall otherwise remain in full force and effect. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF SHAKOPEE, MINNESOTA By Its Chairman By Its Secretary B - 2 EXHIBIT C PERMITTED ENCUMBRANCES 1. Any law, ordinance or governmental regulation (including but not limited to building and zoning ordinances) re- stricting or regulating or prohibiting the occupancy, use or -enjoyment of the Development Property, or regu- lating the character, dimensions or location of any improvement now or hereafter erected on the Development Property, or prohibiting a separation in ownership or a reduction in the dimensions or area of the Development Property, or the effect of any violation of any such law, ordinance or governmental regulation. 2. Rights of eminent domain or governmental rights of po- lice Dower. 3. Defects, liens, encumbrances, adverse claims or other matters: (a) resulting in no loss or damage to the Com- pany; and (b) attaching or created pursuant to Article VI subsequent to the conveyance of the Development Prop- erty to the Company by the Authority. 4. Such encumbrances listed on the title policy obtained by the Company upon the Closing Date pursuant to Section 3.1, provided that no such encumbrance shall, in the opinion of counsel to the Authority, result in the title to the Development Property held by the Company not constituting "marketable title." 5. A Contract for Deed for the purchase of the Development Property executed by the Company as vendee, provided that all parties to such Contract for Deed execute the Authority Mortgage and the Assessment Agreement. 6. Such other encumbrances listed on the title 'commitment obtained by the Company prior to the Authority Closing Date pursuant to Section 3.3 as to which the Authority shall agree. 7. Any First Mortgage approved or permitted under Section 8.2. C - 1 EXHIBIT D QUALIFYING IMPROVEMENTS The following are the Qualifying Improvements which the Company expects to construct and perform on the Development Property: Qualifying Improvements Earthwork and grading Roads and parking Curb and gutter Watermains Sanitary sewers Storm sewers Sidewalk Open space amenities Upon substantial completion of the requisite Qualifying Improvements as provided in Section 3.2 of the Development Agreement, the Company expects to submit to the Authority a certification with respect thereto substantially in the form of Exhibit E attached to and made a part of the Development Agreement, certifying as the actual costs incurred with respect to the requisite Qualifying Improvements for pur- poses of calculation of the Purchase Price pursuant to Sec- tion 3.3 of the Development Agreement. EXHIBIT E CERTIFICATE AS TO COMPLETION AND COSTS OF QUALIFYING IMPROVEMENTS . The undersigned, , is the president of Minnesota Racetrack, Inc., a corporation organized and existing under the laws of the State of Minnesota (the "Com- pany"). The Company, the City of Shakopee, Minnesota (the "City") and the Housing and Redevelopment Authority in and for the City of Shakopee, Minnesota (the "Authority") have Aexecuted a certain Contract for Private Development, dated June _1984 (the "Development Agreement") with respect to the acqusition of certain real property located in the City (the "Development Property") and the construction of a horse -racing facility and certain related improvements (the "Minimum Improvements") thereon by the Company. Pursuant to the provisions of the Development Agreement, and particu- larly Section 3.2 and Exhibit D thereof, the Company agreed to construct and perform certain improvements (the "Qualify- ing Improvements") of a primarily public nature on the De- velopment Property. The undersigned, acting for and on behalf of the Company, hereby certifies as of the date hereof as follows: 1. As of the date hereof, the Company has substan- tially completed the following Qualifying Improvements listed in Exhibit D to the Development Agreement, and the construction and performance of all such Qualifying Improve- ments is in substantial conformance with the Construction Plans (as defined in the Development Agreement) submitted to and approved by the Authority: 2. The following are the true and correct costs, to the best knowledge of the undersigned, incurred by the Com- pany with respect to construction and performance of the Qualifying Improvements: Qualifying Improvements Cost of Improvement Name of Payee E - 1 Attached hereto are copies of the bills submitted by con- tractors or subcontractors, or other evidence satisfactory to the Authority, evidencing the costs listed above. The Company understands and agrees that the costs shown on this Certificate will be used by the Authority in cal- culating the Purchase Price (as defined in the Development Agreement) to be paid by the Authority for the Development Property pursuant to Section 3.3 of the Development Agree- ment. IN WITNESS WHEREOF, the undersigned has hereunto set his hand this day of ► 198_• By Its President E - 2 EXHIBIT F FORM OF PROMISSORY NOTE [Date] FOR VALUE RECEIVED, the undersigned, ("Borrower "+j promises to pay to the Housing and Redevelop- ment Authority in and for the City of Shakopee, Minnesota (the "Authority"), a body corporate and politic and a polit- ical subdivision of the State of Minnesota, or its order, the principal sum of Three Million Dollars ($3,000,000), with interest at the rate of ten per centum (10.00%) per annum on the outstanding principal balance until paid. Said principal and interest shall be payable in 120 equal monthly installments including principal and interest payable on the 1st day of each month commencing on the first day of the month after interest commences, with interest commencing to accrue on the earlier of the (i) the first anniversary of the first day of the first calendar month next following the first day the Minimum Improvements (as hereinafter defined) is open to members of the general public as a horse -racing facility, or (ii) May 1, 1987. Borrower may, at its option, prepay this Note in its entirety on any payment date upon payment of the then outstanding principal balance and accrued interest. All payments of principal and interest shall be payable at the principal office of the Authority in Shakopee, Minne- sota, or such other place as the Authority may designate in writing. This Note is issued puruant to a certain Contract for Private Development, dated jJune , 1984 (the "Development Agreement"), by and among the company, the City of Shakopee, Minnesota, and the Authority, the terms and provisions of which are incorporated herein by reference. Pursuant to the provisions of the Development Agreement, the Authority has acquired and reconveyed the Development Property to the Borrower in consideration of the covenants of the Borrower to construct a horse -racing facility and certain related improvements (the "Minimum Improvements") upon the Devel- opment Property and certain other valuable consideration. Pursuant to Article IV of the Development Agreement, upon completion of the Minimum Improvements by the Borrower in substantial conformance with certain construction plans submitted to and approved by the Authority, the Authority will issue to the Borrower the Certificate of Completion referred to therein. Payment of the principal and interest when due on this Note is secured by a mortgage on the Devel- opment Property and the improvements thereon. F - 1 If default be made in the payment of any installment due _ under this Note or by the occurrence of any one or more of the Events of Default specified in Article X of the Develop- ment Agreement and if such Event of Default is not remedied as therein provided, the Authority then, or at any time thereafter, may give notice to the Borrower declaring all unpaid principal and unpaid interest accrued to the date of payment, together with all other unpaid amounts outstanding under the Development Agreement to be due and payable, and thereupon without further notice or demand all such amounts shall become and be immediately due and payable. Failure to exercise this option shall not constitute a waiver of the right to exercise the same at any time in the event of any continuing or subsequent default. In the event of default in the payment of this Note and if the same is collected by an attorney at law, the Borrower agrees to pay all costs of collection including a reasonable attorney's fee. _ { The Borrower hereby waives presentment for payment, demand, protest, notice of protest and notice of dishonor. This Note and all instruments securing the same are to be construed according to the laws of the State of Minne- sota. Signed this day of , MINNESOTA RACETRACK, INC. By Its President F - 2 O'CONNOR & HANNAN MEMORANDUM DATE: June 11, 1984 TO: Mayor and City Councilmembers, City of Shakopee FROM: O'Connor & Hannan, Wood Kidner SUBJECT: Approval of Amended Development Agreement and Related Documents Mayor and Councilmembers: Enclosed for your review are the resolutions proposed to be adopted by the City and the HRA tomorrow night with respect to amend- ing the Contract for Private Development for Minnesota Racetrack, Inc. ("MRI"). In addition to approving the Amended Development Agreement, the resolutions also provide for approval and execution by the City and the HRA of certain other documents, specifically a Subordination Agreement and Inter -creditor Agreement relating to the Amended Develop- ment Agreement, and make certain findings with respect to satisfaction of certain conditions under the Development Agreement by MRI.—The Subordination Agreement and Inter -creditor Agreement have been re- quested by Twin City Federal Savings and Loan, the proposed construc- tion lender for the racetrack. These two agreement have the effect of subordinating the rights of the City and the HRA under the Develop- ment Agreement and the HRA's Mortgage to the rights of TCF under its Mortgage securing the construction financing. The necessity of this subordination was anticipated and provided for in the Development Agreement, and will not materially affect the City's security for its Bonds or its $3,000,000 Promissory Note as such security has been described in previous memorandums from Jim Casserly and myself. I apologize for the abruptness with which these additional documents are submitted for review; however, I received them myself on Friday afternoon. TCF has indicated that it will not close the construc- tion loan unless these documents are approved by the City and the HRA. In turn, the Racing Commission has set a deadline of Friday, June 15 for MRI to finalize its construction financing. Therefore immediate attention by the City is required. I have reviewed TCF's Mortgage and Construction Loan Agreement and the Subordination Agree- _ ment and Inter -creditor Agreement, and with certain revisions which TCF's counsel, Mackall, Crounse & Moore, have agreed to, find them consistent with the provisions and intent of the Development Agree- f ment. Copies of the Subordination Agreement and the Inter -creditor Agreement enclosed herewith are drafts, but I have been assured that final copies incorporating the suggested revisions will be ready tomorrow. Mayor and City Councilmembers City of Shakopee June 11, 1984 Briefly, the findings to be made tomorrow by the City and the HRA, and their effect, are as follows: 1. Approval of Amended Development Agreement. The draft of the Amended Development Agreement circulated last Friday reflects all material changes to the terms of the Agreement between MRI, the City and the HRA. I will prepare an execution draft of the Amended Development Agreement which will (i) allow the HRA to issue the Tax Increment Bonds should such Bonds be issued as revenue bonds, (ii) list the specific guarantors in Section 6.3, (iii) include a final legal description of the portion of the Development Property which may be conveyed without HRA approval under Section 9.2, and (iv) in- clude certain other minor revisions for purposes of clarification. John Anderson has indicated to me that some questions have been raised with respect to the new provisions in Section 9.2 allowing sale of a certain portion of the Development Property by MRI without prior approval of the HRA. The real estate involved was included by MRI in the initial application to the Racing Commission because there was insufficient time to secure necessary City approvals for subdivision prior to the deadline for submitting the application; however, it was my understanding that it was never intended to con- stitute a part of the racetrack site. I have reviewed the site plan for the proposed facility and a survey, and no part of the proposed facility itself is to be located on the land subject to be released without HRA approval. Therefore, I do not believe this provision effects the City's security or control with respect to the Project. It is my understanding that it is the intention of MRI to reconvey this parcel to the original owners, subject to an agreement that MRI can retain the property if necessary to provide adequate drainage from the racetrack facility. 2. Approval of Subordination Agreement. The Development Agree- ment provides that the City and the HRA will subordinate the Develop- ment Agreement and the HRA's Mortgage to construction financing for the Project, provided that (i) such Mortgage provides for notice to the HRA and an opportunity to cure upon occurrence of a default under the Mortgage, and (ii) the lender agree to the market value established by the Assessment Agreement. TCF's counsel has agreed to provide a revised draft of the Mortgage including an acceptable cross -cure provision prior to the Council meeting tomorrow night. Additionally, TCF has agreed to execute the Assessment Agreement, and such execution as a condition precedent to the obligations of the City and the HRA to issue the Bonds or purchase the Development Property. 2 Mayor and City Councilmembers City of Shakopee June 11, 1984 3. Approval of Inter -creditor Agreement. The Inter -creditor Agreement governs the application of any insurance proceeds or condemnation award received with respect to the racetrack facility. It would supercede the provisions of Article 5 of the Development Agreement. The Inter -creditor Agreement provides that such moneys will be used first to reconstruct the Project, unless, in the opinion of TCF, such reconstruction is not feasible. If reconstruction is not feasible, such proceeds will be paid first to TCF to pay all amounts owing with respect to the construction loan, with any re- mainder being paid next to the City and HRA for application in the following order: (i) payment of the Promissory Note; (ii) reimburse- ment of all other public and redevelopment costs incurred by the City or the HRA in connection with the Project; and (iii) payment and discharge of the tax increment bonds, to the extent such payment is allowable under the documents authorizing the issuance of such bonds. Such proceeds are to be applied to payment of the Promissory Note before payment of the Bonds because (i) the City's security with respect to the Bonds under the Assessment Agreement and guarantees required by Section 6.3 of the Development Agreement is superior to the City's security for repayment of the Promissory Note, and (ii) under existing federal tax law, the City probably will not be able to use insurance proceeds toward payment of the tax increment bonds in an amount in excess of 25% of the debt service on the tax incre- ment bonds without making such bonds industrial development bonds, with the possible effect of making such bonds taxable retroactively. It is my opinion that even though, in the unlikely event that the racetrack would not be reconstructed following casualty, insurance proceeds are payable first to discharge the debt to TCF, that the City is adequately protected as both TCF's loan documents and the Development Agreement require MRI to carry insurance in the amount of the total value of the Project, which is in excess of the sum of the TCF Mortgage, the HRA's Promissory Note and the proposed tax increment bonds. 4. Certain Findings. The HRA resolution also contains find- ings by the HRA approving the construction plans for the Project and approving the TCF Mortgage. The Development Agreement requires HRA approval of the construction plans essentially upon a finding that such plans are consistent with the scope of the Project as proposed by MRI. This approval does not have the effect of waiving any City requirements with respect to zoning, building code or other matters. Additionally, the Development Agreement requires that any mortgage superior to the HRA's Mortgage be entered into by MRI only upon approval by the Authority. TCF has requested that the Authority make these findings prior to closing on the construction loan. I will be at the City Council meeting tomorrow night to answer any questions you may have with respect to these or other matters. 3 CITY OF SHAKOPEE COUNTY OF SCOTT STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION APPROVING AN AMENDMENT TO THE CONTRACT FOR PRIVATE DEVELOPMENT WITH MINNE- SOTA RACETRACK, INC., AND TAKING CERTAIN OTHER ACTIONS WITH RESPECT THERETO BE IT RESOLVED by the City Council (the "Council") of the City of Shakopee (the "City"), as follows: Section 1. Recitals. 1.01. The Housing and Redevelopment Authority in and for the City of Shakopee, Minnesota (the "Authority") Authority, the City and Minnesota Racetrack, Inc. ("MRI") have entered into a Contract for Private Development, dated as of February 28, 1984 (the "Original Development Agreement"), with respect to the acquisition and construction within the City by MRI of a thoroughbred horse- racing facility (the "Project"). The Original Development Agreement was negotiated and executed in anticipation of award of Class A and Class B racing franchises to MRI by the Minnesota Racing Commission. It was understood by all par- ties to the Original Development Agreement that should MRI be awarded the Class A and Class B franchises, that it would probably be necessary to amend the provisions of the Original Development Agreement to accommodate the interests of the construction lender for the Project. Additionally, the Original Development Agreement provided that, upon satisfaction of certain conditions, the City would subordinate its rights under the Original Development Agree- ment to the lien of any mortgage securing the primary con- struction and/or permanent financing for the Project and also provided for execution by the City and the Authority of an Inter -Creditor Agreement between the City and the Holder of the First Mortgage (as defined in the Original Develop- ment Agreement) with respect to the application of any in- surance proceeds or condemnation award payable with respect to the Project. 1.02. Twin City Federal Savings and Loan Association ("TCF") proposes to provide construction financing for the Project in the amount of $25,000,000 and proposes to have executed to secure such financing certain mortgage docu- ments, including a Mortgage and Security Agreement in sub- stantially attached hereto as Exhibit A (the "Mortgage") and a Construction Loan Agreement substantially in the form attached hereto as Exhibit B (the "Construction Loan Agree- ment"). TCF has requested that as a condition of such financing the City (i) make certain revisions to the Original Development Agreement, (ii) execute a Subordination Agreement, substantially in the form attached hereto as Exhibit C (the "Subordination Agreement") subordinating the rights of the City and the Authority under the Development Agreement, the Authority Mortgage and the Development Property Deed to the TCF Mortgage, and (iii) execute an Inter -creditor Agreement substantially in the form attached hereto as Exhibit D (the "Inter -Creditor Agreement"). 1.03. MRI has requested certain revisions to the Original Development Agreement to facilitate financing of the Project. 1.04. The Council has received and reviewed the proposed amendment to the Original Development Agreement, in the form attached hereto as Exhibit E (the "Amended Develop- ment Agreement") and are of the opinion that execution of the Amended Development Agreement will facilitate financing and construction of the Project and is in the best interests of the City and the Authority. Section 2. Subordination tain Findings. Approval of Amended Development Agreement, reement and Inter -Creditor Agreement, Cer- 2.01. The City hereby approves the execution of the Amended Development Agreement, the Subordination Agreement and the Inter -Creditor Agreement in substantially the forms attached hereto, and directs the Mayor and the City of the Authority to execute the Amended Development Agreement, the Subordination Agreement and the Inter -Creditor Agreement and such other documents as shall be deemed necessary to effect the intent of the Amended Development Agreement, the Subordination Agreement and the Inter -Creditor Agreement; together with such necessary and appropriate variations, omissions and insertions as permitted or required or as the Mayor, in his discretion, shall determine, and the execution thereof by the Mayor shall be conclusive evidence of such determination. ADOPTED BY THE CITY COUNCIL OF THE CITY OF SHAKOPEE ON JUNE 12, 1984. ATTEST: City Clerk Mayor - 2 - _g BND/shakopee20 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF SHAKOPEE CITY OF SHAKOPEE COUNTY OF SCOTT STATE OF MINNESOTA RESOLUTION NO. 84-5 A RESOLUTION APPROVING AN AMENDMENT TO THE CONTRACT FOR PRIVATE DEVELOPMENT WITH MINNE- SOTA RACETRACK, INC., AND TAKING CERTAIN OTHER ACTIONS WITH RESPECT THERETO BE IT RESOLVED by the Commissioners (the "Commis- sioners") of the Housing and Redevelopment Authority (the "Authority") in and for the City of Shakopee (the "City"), as follows: Section 1. Recitals. 1.01. The Authority, the City and Minnesota Racetrack, Inc. ("MRI") have entered into a Contract for Private De- velopment, dated as of February 28, 1984 (the "Original Development Agreement"), with respect to the acquisition and construction within the City by MRI of a thoroughbred horse- racing facility (the "Project"). The Original Development Agreement was negotiated and executed in anticipation of award of Class A and Class B racing franchises to MRI by the Minnesota Racing Commission. It was understood by all par- ties to the Original Development Agreement that should MRI be awarded the Class A and Class B franchises, that it would probably be necessary to amend the provisions of the Original Development Agreement to accommodate the interests of the construction lender for the Project. Additionally, the Original Development Agreement provided that, upon satisfaction of certain conditions, the Authority would subordinate its rights under the Original Development Agree- ment and under the Authority Mortgage and the Development Property Deed (as defined in the Original Development Agree- ment) to the lien of any mortgage securing the primary con- struction and/or permanent financing for the Project and also provided for execution by the City and the Authority of an Inter -creditor Agreement between the City and the Holder of the First Mortgage (as defined in the Original Develop- ment Agreement) with respect to the application of any in- surance proceeds or condemnation award payable with respect to the Project. 1.02. Twin City Federal Savings and Loan Association ("TCF") proposes to provide construction financing for the Project in the amount of $25,000,000 and proposes to have executed to secure such financing certain mortgage docu- ments, including a Mortgage and Security Agreement in sub- stantially attached hereto as Exhibit A (the "Mortgage") and a Construction Loan Agreement substantially in the form attached hereto as Exhibit B (the "Construction Loan Agree- ment"). TCF has requested that as a condition of such financing the City and the Authority (i) make certain revi- sions to the Original Development Agreement, (ii) execute a Subordination Agreement, substantially in the form attached hereto as Exhibit C (the "Subordination Agreement") sub- ordinating the rights of the City and the Authority under the Development Agreement, the Authority Mortgage and the Development Property Deed to the TCF Mortgage, (iii) execute an Inter -creditor Agreement substantially in the form attached hereto as Exhibit D (the "Inter -Creditor Agree- ment"), and (iv) make certain findings with respect to the Project and the Mortgage required by the terms of the Devel- opment Agreement. 1.03. MRI has requested certain revisions to the Original Development Agreement to facilitate financing of the Project. 1.04. The Commissioners have received and reviewed the proposed amendment to the Original Development Agreement, in the form attached hereto as Exhibit E (the "Amended Develop- ment Agreement") and are of the opinion that execution of the Amended Development Agreement will facilitate financing and construction of the Project and is in the best interests of the City and the Authority. Section 2. Approval of Amended Development Agreement, Subordination Agreement and Inter -Creditor Agreement; Cer- tain Findings. 2.01. The Authority hereby approves the execution of the Amended Development Agreement, the Subordination Agree- ment and the Inter -Creditor Agreement in substantially the forms attached hereto, and directs the Chairman and the Executive Director of the Authority to execute the Amended Development Agreement, the Subordination Agreement and the Inter -Creditor Agreement and such other documents as shall be deemed necessary to effect the intent of the Amended Development Agreement, the Subordination Agreement and the _ Inter -Creditor Agreement; together with such necessary and appropriate variations, omissions and insertions as per- mitted or required or as the Chairman, in his discretion, shall determine, and the execution thereof by the Chairman shall be conclusive evidence of such determination. - 2 - 2.02. Based upon Resolution 2229 of the City, approved February 28, 1984, and entitled "A Resolution Approving the Shakopee Racetrack Design Development Drawings, Dated Decem- ber 1, 1983", the Authority approves the Construction Plans (as defined in the Development Agreement) for the Project for the purposes of Section 4.2 of the Development Agree- ment. 2.03. The Authority hereby approves the Mortgage and the Construction Loan Agreement as required by Section 8.1 of the Development Agreement and acknowledges that, upon execution of the Mortgage, TCF will be a holder within the meaning of Article 8 of the Development Agreement. ADOPTED BY THE COMMISSIONERS OF THE AUTHORITY ON JUNE 12, 1984. ATTEST: Executive Director Chairman - 3 - _4 JUN C 8 1934 INTERCREDITOR AGREEMENT WHEREAS, the City of Shakopee, Minnesota (the "City"), a municipal corporation and political subdivision organized and existing under the constitution and laws of the State of Minne- sota, the Housing and Redevelopment Authority in and for the City of Shakopee, Minnesota (the "HRA"), a public body corporate and politic, and Minnesota Racetrack, Inc. ("MRI"), a Minnesota corporation, have heretofore entered into a contract for private development dated as of February 28, 1984 (which contract as amended by amendment dated 1984, is hereinafter referred to as the "HRA Agreement"); WHEREAS, Twin City Federal Savings and Loan Association ("TCF"), a United States of America corporation, has committed to loan up to $25,000,000 (the "Loan") to Minnesota Racetrack Limited Partnership ("MRL"), a Minnesota limited partnership of which MRI is the general partner, to finance the construction of a racetrack, grandstand and related improvements (the "Project") on the land described on Exhibit A attached hereto (the "Real Estate"); WHEREAS, the Loan will be secured by a Mortgage and Security Agreement in substantially the form of Exhibit A hereto (the "Mortgage"); WHEREAS, Section 5.1 of the HRA Agreement provides for the application of proceeds of insurance and Subsection 5.1(f) _ thereof provides that such application shall be subject to the provisions of such intercreditor agreement or similar agreement as shall be approved by the HRA; and WHEREAS, Section 5.2 provides for the application of proceeds of any condemnation award and Subsection 5.2(b) of the HRA Agreement provides that the application of net proceeds of any condemnation award shall be subject to the provisions of such intercreditor agreement or similar agreement as shall be approved by the HRA; and WHEREAS, TCF has, as a condition to making the Loan, required that the HRA and the City enter into this Intercreditor Agreement with respect to the application of insurance proceeds and condemnation awards; NOW, THEREFORE, in consideration of $1.00 in hand paid by TCF to each of MRI, the City, and the HRA, and in considera- tion of the foregoing, and for other good and valuable considera- tion, receipt of which consideration is hereby acknowledged, MRI, the City, the HRA, and TCF hereby agree as follows: 1. All terms used herein which are defined in the HRA Agreement have the meanings specified in the HRA Agreement. 2. MRI agrees to notify the City, the HRA, and TCF immedi- ately in the case of damage exceeding $ in amount to, or destruction of, the Project or any portion thereof resulting from fire or other casualty. In the event that such damage does not exceed $ , Net Proceeds of any such insurance shall be paid directly to MRI and MRI will forthwith repair, reconstruct, and restore the Project to substantially the same or -2- an improved condition or value as it existed prior to the event causing such damage and, to the extent necessary, to accomplish such repair, reconstruction and restoration, MRI will apply Net Proceeds of any insurance relating to such damage received by MRI to the payment or reimbursement of the costs thereof. 3. Net Proceeds of any insurance relating to damage or destruction to the Project or any portion thereof as a result of fire or other casualty in an amount estimated to equal or exceed $ shall be payable to TCF and shall be applied as provided in this Section 3 and in Section 4 hereof. In the event that either (a) all or substantially all of the Project is destroyed by such fire or other casualty, or (b) less than all or substantially all the Project is so destroyed and TCF does not consent (and is not required by the Mortgage to consent) to the repair, restoration, and rebuilding of the Project, the Net Proceeds of any insurance relating to such damage or destruction shall be paid to TCF and shall, at its option be held and dis- bursed by it either for payment of the costs of repair, restoration, and rebuilding of the Project in accordance with the Mortgage, or for payment of the following in the order indicated: a. To all fees, costs and expenses and other amounts owing to TCF pursuant to the construction loan agreement relating to the Loan and the Mortgage, other than principal and interest of the Loan; _, b. Interest due on the Loan; C. Principal of the Loan; -3- c} Bonds' -,K e. The payment and discharge of the Tax Increment Pyr A.l�ci �7 C�� �et'R'++a �1c>.�,�:n . q jl, ..,2:2) . Reimbursement of all other public and redevelop- ment costs incurred by the City and the HRA in connection with All Ja the Project; and�- Y3.�� a f. The payment of the Promissory Note. 4. In the event that (a) less than all or substantially all of the Project is damaged or destroyed as a result of fire or other casualty, (b) the Net Proceeds of any insurance relating thereto are estimated to equal or exceed $ , and (c) TCF consents (or is required by the Mortgage to consent) to the repair, restoration, and rebuilding of the Project, then such Net Proceeds shall be paid to TCF which shall hold and disburse such funds. for such repair, restoration, and rebuilding in accordance with the terms of the Mortgage. 5. In the event that title to the Project or such a substantial portion thereof that the remainder is not suitable for use as a racetrack facility is taken in condemnation or by the exercise of the power of eminent domain by any governmental body or other person, the condemnation award shall be payable to TCF and shall be applied to the payment of the items listed in subparagraphs a through f of paragraph 3 of this Agreement. In the event that less than all of the Project is condemned and the remainder is suitable for use as a racetrack facility, the _W condemnation award shall be payable to TCF to be held and -4- disbursed by it for the payment of the costs of repair, restora- tion, and rebuilding of the Project on the Real Estate. Any portion of the condemnation award that is not required for such purpose shall be applied to the items specified in subpara- graphs a through f of Section 3 of this Agreement in the order there stated. 6. Any funds held by TCF pursuant to any of the foregoing paragraphs for repair, restoration, and rebuilding of the Project shall be disbursed by TCF in accordance with TCF's then current construction loan procedures. TCF shall be entitled to reim- bursement for all its costs and expenses incurred in connection with any such damage or destruction, the receipt or collection of insurance proceeds and the disbursement thereof. IN WITNESS WHEREOF, the parties hereto have executed this Intercreditor Agreement as of this day of , 1984. MINNESOTA RACETRACK, INC. By Its CITY OF SHAKOPEE By Its -5- HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF SHAKOPEE By Its TWIN CITY FEDERAL SAVINGS AND LOAN ASSOCIATION By Its _s —6— ion 4 SUBORDINATION AGREEMENT THIS AGREEMENT, made and executed this day of June, 1984, by THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF SHAKOPEE, MINNESOTA, a public body corporate and politic ("HRA"), in favor of TWIN CITY FEDERAL SAVINGS AND LOAN ASSOCIATION, a corporation organized under the laws of the United States of America ("TCF"), WITNESSETH THAT: WHEREAS, The City of Shakopee, Minnesota, a municipal corporation and policitcal subdivision organized and existing under the constitution and laws of the State of Minnesota; Minnesota Racetrack, Inc., a Minnesota corporation; and HRA have heretofore entered into a contract for private development dated as of February 28, 1984, as amended by amendment dated (the "HRA Agreement"); and WHEREAS, the HRA Agreement affects the rights of the parties thereto in and to the premises hereinafter described; and WHEREAS, Minnesota Racetrack, Inc., a Minnesota corporation; Minnesota Racetrack Limited Partnership, a Minnesota limited partnership; and Valley Industrial Development Company II, a Minnesota partnership (collectively referred to as "Mortgagor"), have executed and delivered to TCF a certain mortgage (the "Mortgage") in the amount of Twenty-five Million Dollars ($25,000,000) dated the day of June, 1984, and recorded in the office of the County Recorder, Scott County, Minnesota, on the day of , 1984, as Document No. , conveying and mortgaging the property situated in the County of Scott and State of Minnesota described in Exhibit A attached hereto; and WHEREAS, it is the mutual desire and intention of HRA and TCF and the purpose of this Agreement to make the Mortgage given by Mortgagor to TCF in all respects prior and superior to the HRA Agreement; and WHEREAS, Mortgagor has requested HRA to execute this Subordination Agreement; NOW, THEREFORE, in consideration of One Dollar ($1.00) and other good and valuable consideration and in order to induce TCF to advance funds on the Mortgage, HRA does hereby covenant and agree with TCF that the Mortgage shall in all respects be prior and superior to the HRA Agreement, notwithstanding the fact that the HRA Agreement was executed prior to the execution and recordation of the Mortgage, and that all right, title and interest acquired by TCF either by foreclosure proceedings, by deed in lieu of foreclosure, or otherwise shall be prior and superior to any and all right, title and interest heretofore or hereafter acquired by HRA under the HRA Agreement, the Develop- ment Property Deed or the Authority Mortgage. This Agreement will inure to the benefit of and bind the parties hereto, their heirs, personal representatives, successors and assigns. Terms used herein which are defined in the HRA Agree- ment have the meanings specified therein. In TESTIMONY WHEREOF, HRA has executed this instrument as of the day and year first above written. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF SHAKOPEE, MINNESOTA By Its Chairman And By Its Executive Director STATE OF MINNESOTA ) ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 1984, by and , the Chairman and Executive Director of the Housing and Redevelopment Authority in and for the City of Shakopee, a political subdivision of the State of Minnesota, on behalf of the Housing and Redevelopment Authority in and for the City of Shakopee. This instrument was drafted by: MACKALL, CROUNSE & MOORE 1600 TCF Tower Minneapolis, Minnesota 55402 -2- Notary Public MEMO TO: John K. Anderson, FROM: Judi Simac, City RE: Directional Signs DATE: June 7, 1984 Introduction: City Administrator Planner for the Racetrack Construction A representative of Kraus -Anderson Construction has inquired about obtaining a temporary sign permit to erect four 32 sq. ft. directional signs in the vicinity of the racetrack construction site. The signs would be located as such: one on CR 83, one at the gate on CR 83, one on 4th Avenue, one at the gate on 4th Av- enue. Background: The sign ordinance does not require permits for signs that meet the provisions of Section 4..30, Subd. 3, S: "One directional sign for each seperately owned tract of land is permitted in all districts. Directional signs shall bear no advertising and shall not exceed four square feet in area. Temporary directional signs shall be removed within seven (7) days after termination of the function for which said signs are employed." It is my interpretation of this section that Kraus -Anderson would have to apply for a variance from this provision of the code to erect the proposed signs or comply by placing one dir- ectional sign no larger than 4 sq. ft. on the subject property. The next meeting of the Board of Adjustment and Appeals is July 12, 1984. It has been brought to my attention that this matter may be addressed under Section 4.30, Subd. 3, N regarding portable signs. The code states, "A portable sign used for the purpose of directing the public may be permitted upon issuance of a Temporary Sign Permit under the following conditions: I. Said sign is coincidental to, or used in conjunction with, a public function. 2. The period of use of said sign shall not exceed ten (10) days. 3. Prior approval of a majority of the Council shall be required for the use of any such sign. Should this provision prove applicable, Kraus -Anderson would have to apply for a temporary sign permit every ten days. Alternatives: 1. Approve staff interpretation of the directional sign provisions which would require Kraus -Anderson to apply for a variance to construct the proposed signs. 2. Recommend that the proposed signage is determined to be portable and shall be permitted a temporary sign permit to be applied for and issued every ten days. 3. Recommend that the proposed sign is determined to be portable and shall be issued a temporary sign permit for a specific period of time with a specific application fee. 4. Recommend that the proposed signage is determined to be directional, which will require a variance from the sign ordinance, however a temporary sign permit shall be issued for the interim time period prior to the July 12, 1984 Board of Adjustment and Appeals Meeting. Recommendations: Staff recommends alternative #1. Action Requested: Motion to approve staff interpretation of the sign ordinance regarding directional signs. Al MEMO TO: John K. Anderson, City Administrator FROM: Judith S. Cox, City Clerk RE: Renewal of Non -Intoxicating Malt Liquor Licenses DATE: June 12, 1984 INTRODUCTION The following applicants have applied for a 1984-85 On and/or Off Sale Non -Intoxicating Malt Liquor License. All applications are in order except for one. Please approve and table the one application that is not in order. AQTION REQUESTED Approve the applications(s) and grant a . . . license to: Approve/ Table Applicant On Sale Off Sale Approve Jim & Lucy's Inc. X X 210 West 1st Avenue Approve Jackson E. Chilquist X X 220 West 2nd Avenue Approve Friendly Folks Club, Inc. X 123 East 1st Avenue Approve Marlene Berg X 222 East 1st Avenue Approve Richard E. Cleveland X 828 East 1st Avenue Approve Pnd, Inc. X 409 East 1st Avenue Approve Art Berens & Sons, Inc. X 123 West 2nd Avenue Approve Juba's, Inc. X 1100 Minnesota Valley Mall Not Minnesota Valley Restoration X Renewing 2187 East Highway 101 Approve Superamerica Stations Inc. X 1155 East 1st Avenue Approve Cedar Fair Limited Partnership X One Valleyfair Drive Approve Holiday Stationstores X 444 East 1st Avenue Approve Pizza Huts of the Northwest X 257 Marschall Road Table Valley Racquetball & Handball X 600 County Road 83 Approve Brooks Superette, Inc. X 615 Marschall Road Approve Northern Racing Corp. X 6528 T.H. 101 Approve Q Petroleum X 235 West 1st Avenue JSC/jms MEMO TO: John K. Anderson, City Administrator FROM: Judith S. Cox, City Clerk RE: Renewal of On Sale Wine License DATE: June 12, 1984 INTRODUCTION The following applicant has applied for a 1984-85 On Sale Wine License. The application is in order. Please approve. ACTION REQUESTED Approve the application and grant an 1984-85 On Sale Wine License. Approve/ Table Applicant Approve Cedar Fair Limited Partnership One Valleyfair Drive JSC/jms MEMO TO: John K. Anderson, City Administrator FROM: Judith S. Cox, City Clerk RE: Renewal of Off Sale Intoxicating Liquor Licenses DATE: June 12, 1984 INTRODUCTION The following applicants have applied for a 1984-85 Off Sale Intoxicating Liquor License. All of the applications are in order. Please approve. ACTION REQUESTED Approve the applications and grant a 1984-85 Off Sale Intoxicating Liquor License to: Approve/ Table Applicant Approve Pullman Club, Inc. 124 West 1st Avenue Approve XX Corporation & Wittles. Inc. 1561 East 1st Avenue Approve Clair's Bar, Inc. 124 South Holmes Approve Family Dining, Inc. 6268 East Highway 101 Approve Riverside Liquors, Inc. 507 East 1st Avenue Approve Dennis P. Bruesehoff & Thomas J. Cox 1104 Minnesota Valley Mall Approve Friendly Folks Club, Inc. 122 East 1st Avenue Approve The Weiss Company, Inc. 8522 East Highway 101 JSC/jms //f MEMO TO: John K. Anderson, City Administrator FROM: Judith S. Cox, City Clerk RE: Renewal of On Sale Intoxicating Club Liquor Licenses DATE: June 12, 1984 INTRODUCTION The following applicants have applied for a 1984-85 On Sale Intoxicating Club Liquor License. Two of the applications are in order. Please approve and table the one that is not in order. ACTION REQUESTED Approve the applications and grant an On Sale Intoxicating Club Liquor License to: Approve/ Table Applicant Table The American Legion Post No. 2. East First Avenue Approve Veterans of Foreign Wars, 132 East 1st Avenue Approve Shakopee Council 1685 Home Assn. Inc. 1760 East 4th Avenue JSC/jms NI MEMO TO: John K. Anderson, City Administrator FROM: LeRoy Houser, Building Official RE: Telephone Purchase DATE: June 4, 1984 Introduction: As per your instructions, I have investigated the cost of purchase versus rental of our telephone equipment. Background: In contacting AT&T the following was revealed: Unit Purchase Price Rental Price Pay Back City Hall $1,079.96 $107.20/month 10.07 months Comm. Serv. 965.54 34.61/month 27.89 months Fire Station 125.85 8.55/month 14.72 months Police Station 2,635.58 119.60/month 22.03 months Public Works 167.80 10.00/month 16.78 months Library 737.36 26.05/month 28.30 months Radio Shack provided a written proposal to replace our system with basically what we have now. The only difference would be the units would be smaller. Their replacement bid is $19,462.95. Figures for hourly maintenance costs are not firmed up yet. It is estimated to be $35.00 to $40.00 per hour. To my knowledge, we have used a minimum of repair other than our base unit in the 11 years I have been here. Recommendation: My recommendation is to purchase our present system. Action Requested: Authorize the appropriate City Officials to execute equipment pur- chase agreements with AT&T for the purchase of the City's present telephone system at a cost not to exceed $5,712.09. LH:cah Attachment ANT Equipment Agreement A' 12--8 Information Systems / f Yansaction Type Contract No. .eck appropriate transactions and follow color coding. GB 276798 a Equipment Purchase C 1 AT&T -IS Financing Ci Term Plan Cd Maintenance Agreement Contract Terms stomer acknowledges receipt of the attachments indicated below. Customer agrees with the terms and conditions contained in the 3chments and further agrees that attachments are part of this agreement. EXCEPT FOR THE WARRANTIES SPECIFICALLY MADE IN ANY OF THE SIGNATED ATTACHMENTS, AT&T INFORMATION SYSTEMS, INC. AND ITS AFFILIATED SUBCONTRACTORS AND SUPPLIERS MAKE NO WARRAN- FS, EXPRESS OR IMPLIED, AND SPECIFICALLY DISCLAIM ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Addition, AT&T Information Systems, Inc. shall in no event be liable for any indirect, incidental or consequential damages (including lost ottts), or for damages in excess of $50,000, sustained or incurred in connection with work performed or products and services provided ,der this agreement. No employee of AT&T -IS has authority to modify the terms and conditions in Attachments B, C, D and E, and any �rported modification shall be null and void. This equipment agreement and the receipted attachments constitute the entire agreement ,tween the parties and supersedes all prior agreements, proposals or understandings whether written or oral. Issue Date Cust. initials Issue Date Cust. Initials A. Equipment Agreement Supplement: �_ D. Warranty/Maintenance Terms and Conditions: B. Equipment Purchase Terms and Conditions: f� �'� k C.i E. Financing Terms and Conditions: —� C. Term Plan Terms and Conditions: L_; F. Other: —� lstomer signature below also provides AT&T Information Systems, Inc. permission to obtain credit information from sources referenced Ider credit information including any previous communications company and any external credit information source. (Customer) Y (Authorized Signature) AT&T INFORMATION SYSTEMS INC. Received by: Accepted by: (Authorized Signature) (Typed Name) (Title) dA.HrirPc�{ Product PEC _ Supplement No. his Contract Not For Use With MerlinTM Communications System Total Purchase Total Install ustomer Legal Name AT&T -IS Use Only -IS Branch Code cif' '�l�rf'fE , r i __47-/ ddress Room No. Floo TNo.Address Room No. Floor No. i. _ ,ty, State / Zip Code City, State Zip Code •om Attached Equipment Supplement ontact Telephone,/ Contact T r Telephone =neral Order Information Total A Total B stomer acknowledges receipt of the attachments indicated below. Customer agrees with the terms and conditions contained in the 3chments and further agrees that attachments are part of this agreement. EXCEPT FOR THE WARRANTIES SPECIFICALLY MADE IN ANY OF THE SIGNATED ATTACHMENTS, AT&T INFORMATION SYSTEMS, INC. AND ITS AFFILIATED SUBCONTRACTORS AND SUPPLIERS MAKE NO WARRAN- FS, EXPRESS OR IMPLIED, AND SPECIFICALLY DISCLAIM ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Addition, AT&T Information Systems, Inc. shall in no event be liable for any indirect, incidental or consequential damages (including lost ottts), or for damages in excess of $50,000, sustained or incurred in connection with work performed or products and services provided ,der this agreement. No employee of AT&T -IS has authority to modify the terms and conditions in Attachments B, C, D and E, and any �rported modification shall be null and void. This equipment agreement and the receipted attachments constitute the entire agreement ,tween the parties and supersedes all prior agreements, proposals or understandings whether written or oral. Issue Date Cust. initials Issue Date Cust. Initials A. Equipment Agreement Supplement: �_ D. Warranty/Maintenance Terms and Conditions: B. Equipment Purchase Terms and Conditions: f� �'� k C.i E. Financing Terms and Conditions: —� C. Term Plan Terms and Conditions: L_; F. Other: —� lstomer signature below also provides AT&T Information Systems, Inc. permission to obtain credit information from sources referenced Ider credit information including any previous communications company and any external credit information source. (Customer) Y (Authorized Signature) AT&T INFORMATION SYSTEMS INC. Received by: Accepted by: (Authorized Signature) (Typed Name) (Title) dA.HrirPc�{ Product PEC Qty. AT&T -IS Use Only Total Monthly Total Purchase Total Install Total Maint. AT&T -IS Use Only i. _ •om Attached Equipment Supplement Install.i®el. Date tal r 4 prices and rates are exclusive of aesfuse taxes. Total A Total B Total C Total D ,)mplete This Section for Financed Purchase Shipping (Total Transportation Costs) Total Equipment Price (Total Column B) ($ Credits/Down Payments (CDP) $ 't. Total Installation Price (Total Column C) $ Complete This Section for Wiring J AT&T-ISCustomer Installed Other +. Total Cash Price (Line 1 + Line 2) I $ 4. Total Down Payments/Credits (CDP Block) I = Complete This Section For Equipment Installation AT&T -IS Customer Cash Price Balance (Line 3 - Line 4) ! f = Complete This Section for Maintenance a. Monthly Payments 7.$ fMo. Effective Date 5 /'` / r�! Y' ,� Term Plan ! Warranty Coverage ?� 8 AM -5 PM Mon -Fri E-1 24 Hrs. 7 Days 3. Time Price Balance (Line 6 x Line 7) $ Effective Date / / Optional Maintenance Service J 8 AM -5 PM Mon -Fri ❑ 24 Hrs. 7 Days Customer Rate Complete This Section for Term Pian ❑ Monthly (3 Month Minimum) 0 12 Month Ci 24 Month C 48 Month i- 72 Month L7 Other: Time Price Differential (Line 8 - Line 5) I $ Time Sale Price (Line 4 + Line 8) $ stomer acknowledges receipt of the attachments indicated below. Customer agrees with the terms and conditions contained in the 3chments and further agrees that attachments are part of this agreement. EXCEPT FOR THE WARRANTIES SPECIFICALLY MADE IN ANY OF THE SIGNATED ATTACHMENTS, AT&T INFORMATION SYSTEMS, INC. AND ITS AFFILIATED SUBCONTRACTORS AND SUPPLIERS MAKE NO WARRAN- FS, EXPRESS OR IMPLIED, AND SPECIFICALLY DISCLAIM ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Addition, AT&T Information Systems, Inc. shall in no event be liable for any indirect, incidental or consequential damages (including lost ottts), or for damages in excess of $50,000, sustained or incurred in connection with work performed or products and services provided ,der this agreement. No employee of AT&T -IS has authority to modify the terms and conditions in Attachments B, C, D and E, and any �rported modification shall be null and void. This equipment agreement and the receipted attachments constitute the entire agreement ,tween the parties and supersedes all prior agreements, proposals or understandings whether written or oral. Issue Date Cust. initials Issue Date Cust. Initials A. Equipment Agreement Supplement: �_ D. Warranty/Maintenance Terms and Conditions: B. Equipment Purchase Terms and Conditions: f� �'� k C.i E. Financing Terms and Conditions: —� C. Term Plan Terms and Conditions: L_; F. Other: —� lstomer signature below also provides AT&T Information Systems, Inc. permission to obtain credit information from sources referenced Ider credit information including any previous communications company and any external credit information source. (Customer) Y (Authorized Signature) AT&T INFORMATION SYSTEMS INC. Received by: Accepted by: (Authorized Signature) (Typed Name) (Title) dA.HrirPc�{ Ilk M E M O R A N D U M TO: John K. Anderson, City Administrator FROM: Ray Ruuska, Engineering Coordinator RE: Trunk Highway 101 Frontage Road County road 89 to the West line of Cretex Industrial Park 1st Addition DATE: June 8, 1984 Introduction: Attached are the documents, signed by Cretex, Inc., for acquisi- tion of necessary right-of-way and easements for the construction of the above mentioned project. Background: Realignment of this project made necessary the above acquisitions. Cretex, Inc. has agreed to provide these parcels on the condition that the City take steps necessary to vacate Cretex Avenue. Action Requested: 1. Authorize execution of the agreements. 2. Adopt Resolution No. 2274, A Resolution Initiating the Vacation of Cretex Avenue in Cretex Industrial Park 1st Addition, Scott County, Minnesota, and in Howe 1st Addition, Scott County, Minnesota. RR:cah Attachment RESOLUTION NO. 2274 A RESOLUTION INITIATING THE VACATION OF CRETEX AVENUE IN CRETEX INDUSTRIAL PARK 1ST ADDITION, SCOTT COUNTY, MINNESOTA, AND IN HOWE 1ST ADDITION, SCOTT COUNTY, MINNESOTA WHEREAS, it has been made to appear to the Shakopee City Council that Cretex Avenue in Cretex Industrial Park 1st Addition and in Howe 1st Addition serves no public use or interest; and WHEREAS, a public hearing must be had before such action can be taken and two weeks published and posted notice thereof must be given. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SHAKOPEE, MINNESOTA, that a hearing be held in the Council Chambers on the 3rd day of July, 1984, at 7:45 p.m., or thereafter, on the matter of vacating Cretex Avenue in Cretex Industrial Park 1st Addition, Scott County, Minnesota, and in Howe 1st Addition, Scott County, Minnesota. BE IT FURTHER RESOLVED, that two weeks' published notice be given by publication in the Shakopee Valley News and posted notice be given by two weeks posting a copy oCsuch notice on the bulleting board in the main floor of the Scott County Court- house, on the bulletin board in the Shakopee City Hall and on the bulletin board at the Shakopee Public Utilities. City 1984. Adopted in session of the City Council of the of Shakopee, Minnesota, held this day of Mayor o t e City o S a opee ATTEST: Approved as to form this day of , IT$4 City Attorney ) Al- RESOLUTION W it 4" AGREEMENT Cretex Companies, Inc., a corporation organized under the laws of the State of Minnesota, does enter into this agreement with the City of Shakopee, a body corporate and politic, as follows: 1. Cretex Companies, Inc., shall grant to the City of Shakopee a permanent easement over parts of Lots 1, 2, and 3 of Block 1, and parts of Lot 1, Block 3, Cretex Industrial Park lst Add'n., as set forth in the attached Quit Claim Deed. 2. In consideration of said easement, the City of Shakopee agrees to take steps leading to the vacation of Cretex Avenue as located within the plat of Cretex Industrial Park lst Add'n., retaining for the public a utility easement 40 feet in width for maintenance of existing utilities and installation of future utilities. 3. If the City fails to complete the vacation as set forth in paragraph 2 above, the parties hereto agree that additional consideration shall be owed Cretex Companies, Inc., and the amount of said consideration for the above -referenced easement shall be negotiated by and between the parties. Should the parties be unable to agree upon such consideration, the said consideration shall be determined by arbitration, with each party selecting one arbitrator, those two arbitrators selecting a third arbitrator, and the three arbitrators determining by majority vote the consideration for said easement, which shall be binding upon both parties. Should the initial two arbitrators be unable to agree on the selection of a third arbitrator, either party may apply to the Senior Judge of the First Jud cial District for the appointment of such third arbitrator. Executed this �_ day of June, 1984. CRETEX JMPANIES, INC. By,x is C N OF SHAKOPEE By: Its Mayor By: Its City Clerk a.n Claim D" Form No. 31--N1. Comorstten to arperatlom 11 '!� ne 84... ZN5 Inbenture, ✓Bade this.......... � . -' ........................ day of........Ju ...... 1e,................................ , 19.. , between.CRETEX COMPANIES.t....INC. .......................... I ....................................... .............. ..................... ............ ............................................. ..... a corporation under the laws o the State o Minnesota party of the first part, and rp f f ............. . CITY OF SHAKOPEE, a bod.Y corporate and politic, ............................. .................... I ....................... ... a corporation under the laws o the State o Minnesota .. P f f ............... , party of the second" part, Witneg;5etb, That the said party of the first part, in consideration of the sun of One Dollar ($1.00) and other good and valuable consideration- ------- ---DOLLARS, to it in hand paid by the said party of the second part, the receipt whereof is hereby acknowledged, does hereby Grant, Bargain, Quitclaim, and Convey unto the, said party of the second part, its successors and assigns, Forever, all the tract.......... or parcel......... of land lying and being in the County of ........................ ....Sc..o...t...t ............................................ ..........and State of .tlinnesota, described as follows, to -wit: ...... A permanent easement, 70.00 feet in width, over, under and across part of Lot 1, Block 1, CRETEX INDUSTRIAL PARK 1ST ADD'N as platted and of record in the office of the County Recorder, Scott County, Minnesota. The centerline of said strip is described as follows; Commencing at the Northwest corner of said Lot 1; thence S 0°27'42" E, bearing assumed, along the west line of said Lot 1, a distance of 171.00 feet to the point of beginning of the centerline to be described; thence N 89°32'18" E, a distance of 20.00 feet; thence northeasterly along a tangential curve, concave to the northwest, having a radius of 150.00 feet and a central angle of 57°32'18" an arc distance of 150.64 feet; thence N 32°00'00" E, tangent to last described curve, a distance of 37.08 feet; thence northeasterly along a tangential curve, concave to the south- east, having a radius of 275.00 feet and a central angle of 20°02'21" an arc distance of 96.18 feet to the north line of said Lot 1, and there terminating. The side lines of said strip of land are to be lengthened or shortened to termi- nate on the north line of said Lot 1. A permanent easement for drainage and utility purposes over, under and across the west 15.00 feet of the east 25.00 feet of Lot 1, Block 1, CRETEX INDUSTRIAL PARK 1ST ADD'N. as platted and of record in the office of the County Recorder, Scott County, Minnesota. A permanent easement for drainage and utility purposes, over, under and across the west 15.00 feet of the east 25.00 feet of Lot 2, Block 1, CRETEX INDUSTRIAL PARK 1ST ADD'N. as platted and of record in the office of the County Recorder, Scott County, Minnesota. A permanent easement for drainage and utility purposes over, under and across the west 15.00 feet of the east 25.00 feet of Lot 3, Block 1, CRETEX INDUSTRIAL PARK 1ST ADD'N. as platted and of record in the office of the County Recorder, Scott County, Minnesota. A permanent easement for drainage and utility purposes over, under and across the west 15.00 feet of the east 25.00 feet of Lot 1, Block 3, CRETEX INDUSTRIAL PARK IST ADD'N. as platted and of record in the office of the County Recorder, Scott County, Minnesota. tl:.o g3alie anD t0 A)01D MC A)aIiiC, Together with all the hereditaments and appurtenances there- unto belong ing or in anyudse appertaining, to the said party of the second part, its successors and assigns, Forever. In Teotitnonp Wfiercof, The said first party has caused these presents to be executed in its corporate, name by its.....:'r. :...:....... President and its......:.:4::""::.................................and its corporate seal to be hereunto affixed the day and year first above written. CRETEX COMPANIES, INC. ............................................................,..................... ........................,... ...:.............:..:....................................... c Its..... .....: SHAKOPEE, MINNESOTA Page 1 JUNE 11, 1984 Paul Wermerskirchen, James O'Neill Gary Eastlund Al Furrie John M. Manahan Bud Berens, Shakopee Chairman Development Corp. Liaison Jane DuBois Bob Blenkush, Chamber of Cam erce Liaison John K. Anderson, City Administrator John Anderson made an oral presentation to the Commission summarizing' the main aspects of the"City Street Traffic Evaluation" done for the city by it's consultant. After considerable amount of discretion by all members and further verification by Mr. Anderson, Mr. Manahan made a motion, seconded by Mr. Furrie and unanimously passed by all members approving the following resolution. "RESOLVE, that the Industrial commission hereby approves all re- ccmmendations, without change, made by Westwood Planning and Engineering Company in the City Street Traffic Evaluation Form for the City of Shakopee and presented to it by letter dated April 22, 1984. There was also a lengthly discussion concerning the need for design criteria in light of the additional development expected in conjunction with the new race track. Motioned by Mr. Furrie, seconded by Mr. O'Neill , that it is the consensus of the Industrial Catmercial Commission that a considerable amount of time, efforts and thought have been put into the formulation of the zoning ordinances and other regulations affecting building within the City of Shakopee. It is the further consensus of the Industrial Can-ercial Commission that no significant changes should be made in these ordinances, including especially changes involving design criteria, should be made without extensive dialogue among all members of the community who may be affected, including but not limited to developers, merchants, realtors, builders, city staff, etc. Motion was passed unanimously. �r ;Re � tful3 `sulanitt d, ohm M. Manahan 'Acting Secretary 13's Al MEMO TO: Mayor and Council FROM: John K. Anderson, City Admin. RE: Secretarial Staffing For City Hall. DATE: May 31, 1984 INTRODUCTION Last Fall we rearranged Secretarial assignments and relo- cated one Secretary. We entered into this new arrangement on a trial period basis and have been evaluating it over the past six months. The trial period evaluation has been complicated because one Secretary has left, one Secretary took an extended pregnancy leave, and the third Secretary took a previously planned extended vacation. We have been working with the three Secretaries who would be the permanent Secretaries now for more than a month and some of the problems we experience because of the reassignment of staffing duties have not gone away. The problems have not gone away even though City Hall employees have worked hard to make the new assignments and locational changes work. Employees have done this because they generally prefer the new arrangement. PROBLEM During the trial period Department Heads met periodically to address problems and gliches in the new arrangement. Nearly all of the problems have been resolved with the exception of the work overload on the Secretary shared by the Building Official and the City Engineer. On May 30th, the Department Heads in City Hall met again to react to the concerns expressed in the Building Official and City Engineer's letter of May 25, 1984 (attached). Everyone was in agreement that the overall change has been successful, that the Secretarial duties as now assigned were working with the one exception of the work overload on the shared Building and Engineering Secretary. The overload is most dramatically illustrated when one reviews the Secretary's time- sheets and finds that the Engineering Department is receiving from one-fourth to one-third of her time. Clearly this is inade- quate. ALTERNATIVES City Hall Department Heads have discussed numerous Secretarial configurations that could be considered as alternatives. These included sharing Secretarial duties differently so that one Secretary would not be working for Building and Engineering. The alternatives discussed also covered numerous combinations of full and part-time Secretarial staffing and locational placement within the City Hall Building. Constraints dealt with included the need to have someone handling telephones with a back-up, someone handling walk-in traffic with a back-up, flexibility so Secretaries can leave their desk for copying, filing and use of word processing equipment. These problems were all compounded by the physical constraints of the current City Hall Building. Y141- Secretarial w Secretarial Staffing For City Hall. Page 2 May 31, 1984 One of the key considerations in determining staffing was the status of current staffing. In 1983, the City had three full-time Secretarial positions budgeted. In 1984, the City budgeted 2-3/4 Secretaries to accommodate Jeannette Shaner's pregnancy leave and help financially with the budget. With the economic upswing in housing and the Racetrack the City has been operating with 3-3/5 Secretaries since Jeannette Shaner returned from pregnancy leave. This increase is not permanently fixed because we are only obligated to 2-3/4 Secretarial time in terms of permanent employees. The additional employees are from Holly's Temporary Service and shared use of the Chamber Secretary for 8 hours per week. All of the City Hall Department Heads agreed that the three permanent Secretaries (one scheduled at 3/4 time) are excellent and we do not want to lose any of them. Therefore, only two alternatives were given serious consideration by Department Heads involved. 1] Hire one full-time Secretary by replacing the temporary Secretaries which would bring our Secretarial commitments to 3-3/4 Secretaries. This alternative was rejected by Department Heads because it lacked the physical flexi- bility needed to cover all of the unusual constraints listed above. 21 Hire another permanent part-time Secretary. If this person were brought in at 3/5th time, the toal permanent commitment to Secretarial Staffing would be equivalent to 3-1/5th Secretary. This alternative provided us with the flexibility of placing one Secretary in Engi- neering and one in Building. The Engineering Secretary would be permanent part-time and the Secretary in Building would be out front carrying on all of the duties listed in the second to the last paragraph of Page 2 of the attached memo dated May 25th. Of those duties listed finance receipting, central files, alpha -files and walk-in traffic provide services to all Department Heads in City Hall. RECOMMENDATION As we stated when we increased our staffing to 3-3/5ths time when Jeannette Shaner returned, the City will receive roughly $250,000.00 in Building Permit income in 1984. This clearly pro- vides us with the revenue to increase staffing during 1984 which may well be a peak year because of the Racetrack. Staff recommends alternative #2 with the addition that the present full-time Tem- porary Service Secretary be maintained through the month of August. This is essential because it will allow the permanent part-time 1 .3 r� Secretarial Staffing For City Hall. Page 3 May 31, 1984 Secretary hired for Engineering to spend all of her time learning the Engineering tasks without numerous other distracting respon- sibilities. In August we can evaluate staffing needs and dis- continue the temporary help or continue it for one or two addi- tional months if the Racetrack demands warrant it. In either case, we will have the revenues to cover this staffing level. The attached job description lists the functions of the Secretary that would serve the Engineering Department. ACTION REQUESTED Authorize the appropriate City Officials to advertise for one permanent part-time Secretary within the pay range established for Secretaries in the 1984 Secretarial Pay Plan. The Secretary being hired will be assigned to the Engineering Department and will work 3/5ths time or 24 hours per week. JKA/bn Att. M E M O R A N D U M TO: John K. Anderson, City Administrator FROM: LeRoy Houser, Building Official H.R. Spurrier, City Engineer RE: Secretarial Help DATE: May 25, 1984 Introduction: It isn't working. Background: A few months ago in the spirit of cooperation, we agreed to em- bark upon an experiment in sharing secretarial help in the interest of cost cutting. Before entering into this experiment, you assured us you would review the situation periodically to see if it was a viable solution to the money problem shortfall we were experiencing. Twice I have told you it is not working. Bo, the last time, apparently did not agree with me and decided to try to go the extra mile for the City's sake and tough it out a little longer, hoping it may eventually work out. Now, Bo is also convinced it cannot work and it does not work. Listed below are the reasons why it won't and doesn't work. 1. My radio doesn't get answered half the time because Cora is working upstairs. 2. Both of our messages are in error quite often when Cora doesn't get them. 3. The workload is too great for Cora to handle both of us, especially during our construction season. 4. Priority items for both of us are a problem. I need things done at the same time Bo needs things done. 5. Walk-in traffic is a problem. They are not being serviced in the timely manner they should be when Cora is not at the desk. 6. Inspection messages are being left on my desk when Cora is upstairs and I am out on inspections. I should be contacted regarding them on the radio. 7. Engineering files are not current because Cora is spread too thin. 8. Insufficient time for Cora to learn Engineering procedures resulting in delays to legal notices. 9. Engineering Dept. workload being subordinate to Building Dept. priorities and vice versa as we each see it. 10. Building Inspector and City Engineer have to undertake secretarial tasks because secretary was unavailable to perform tasks due to being tied up with Inspector or Engineer. 137--, My busy season is about a week away. I need Cora at the desk to schedule inspections, issue permits, channel walk-ins to the right departments and to generally coordinate the operation of the Building Dept. Bo is entering into his busy season and faces these same problems. We are about to receive more permit money than any other year on record. It is not an appropriate time to weaken either one of our departments. We both want to make it clear, the reason it is not working is not because Cora is not competent, willing or trying, it is because the demand is too great and no matter how we rearrange, cross train or backup, it won't work. We gave it our best shot, let's solve it, forget it and move on to other problems to solve. Both Bo and I are in agreement Cora should return to regular duties, i.e., building, finance receipting, permits, central file, alpha file, CRV's, walk-in traffic, monthly reports, etc. Walk-in traffic requires more than talking to people and shipping them down the hall. She has to answer many questions, run off maps, find legals and sometimes calm angry people when none of the dept. heads are here to listen to complaints. v POSITION DESCRIPTION POSITION: Engineering Secretary DEPARTMENT: Engineering V'r RESPONSIBLE TO: City Engineer Primary Objective of Work: This position is responsible for performing the Secretarial and Clerical tasks required by the City Engineer r. Examples of Work: Manages the routine elements of Minnesota Statutes Chapter 429 Special Improvement Districts by preparing schedules, notices, documents, mailings and then monitors the progress of the individuals districts. Maintains the ledger of Engineering Department accounts receivable and other accounts. Monitors all purchases, verifying that proper purchasing procedure is used. Maintains all Engineering Department letter files, project files and special files. Types text, numeric tables, legal descriptions and other documents from copy, general instruction or machine dictation. Knowledge, Skills and Abilities: Have an ability to maintain accurate alphameric, numeric and statistical records. Have an ability to prepare standard documents and correspondence from general instructions. Have clerical skills necessary to take machine dictation and type 55 words per minute. Have the skills required to operate ordinary adding machine. Desired Experience and Trainincl: High School graduate with two years of Clerical and Secretarial experience. Vocational or business school training is desirable. RESOLUTIOH_! U� A RESOLUTION AUTHORIZING SCOTT COUNTY, MINNESOTA TO COLLECT 90% OF THE TOTAL ORIGINAL ASSESSMENTS FOR LOCAL IMPROVEMEN-S WHEREAS, For several years last Passed the Chicago, Milwaukee, St. Paul and Pacific Railroad Company did not pay special, assessments for local improvements assessed by the City against real estate owned by the said railroad company in the City of Shakopee; and WHEREAS, Said railroad voinparly is ,lon, in reorganization under an,�! n-.1"s,11ant- to the federal laws and is under the Juris'liction of the federal court sJttln,a in Cook County, Illinois; and WHEREAS, Under the supervision o[ the federal gcvernment, certairt obligations of the railroad are to be paid in an amount aurhorized by the, government agancy; and WHEREAS, The said government agency rias authorized the payment of 901", of the total original assessment of the C-ity of '.1akopee against said railroad fcr local, improvements. THEREFORE, BE IT RESOLVED BY THIE SHAIKOPEE CITY COUNCIL AS FOLL0141q: 1. That the Council, being fully advised in the premises, determines that it would be tothe beat interests of the City of Shakopee to accept 'M settlement figures and accordingly, does accept said figures; 2. That a certified copy of this resolution forwarded to Scott Ccunty will 'serve as authorization for the county to settle the special assessments for 90% ofthe original principal assessments. Passed in adjourned regular session of the Shakopee City Council held thir, day of C, 1984. Mayor of the Cityhako�pe ATTEST: i A- U I t ClerkApprov as form this 12th day of June, 1984 s as 'orm Attorney y S -ha opee City Attorney 9k 6 a Form 407 • Poucher, MPI . O Commissioner of Revenue Abatement Form S (Rev. 3174) APPLICATION FOR SETTLEMENT AND ABATEMENT OF DELINQUENT TAXES, PENALTIES, INTEREST, AND COSTS UPON REAL ESTATE Scott G 8 Complete in triplicate if tax reduction request exceeds $500; otherwise complete in duplicate. please print or type. School District No. C.M. St. P. & P Railroad Comp, Application :street Address City or Township Zip Code 516 W. Jackson Blvd., Chicago, IL 60606 DESCRIPTION OF PROPERTY Railroad property located in Scott County. 3WNER_'S DATA 1. Estimated 11arket Values Land Structures Total $ 2. Taxes on said real estate are delinquent and unpaid for all of the following years: 1978 through 1983 3. Accumulated taxes, penalties, interest, and costs which are now a lien against said real estate amounted to $ ?. Said property (is not) applicant's homestead. (Explain fully) Railroad property 5. The reasons said taxes have not been paid are as follows. (Explain fully) The Company is under Federal reorganization. 3. Applicant is willing and now offers to pay in full settlement of said accumulated taxes, penalties, interest and costs the sum of $ 11,165.02 %. Such settlement is reasonable because: (Explain fully why applicant cannot or will not pay more) The Company is currently under reorganization proceedings. ,kPPLICANT'S REQUEST -- Applicant requests that said taxes, penalties, interest, and costs in excess of said sum offered by applicant be abated and cancelled upon the payment by him of said sum, and that such payment be accepted in full payment thereof. Applicant's Signature Date NOTE: Minnesota Statutes 1971, Section 509.41 "Whoever in making any statement, oral or written which is required or authorized by law to be made as a basis of imposing, reducing, or abating any tax or assessment, intentionally makes any statement as to any material matter which he knows is false may be sentenced, unless otherwise provided by law, to imprisonment for not more than one year or to payment of a fine of not more than $1,000, or both." ASSESSOR'S VERIFICATION OF FACTS OR OWNER'S DATA Recommendation of Assessor C] Approved ® Denied (]Other (explain) Assessor's Signature Date Penn 1273 • Pouchm, MPb. o camr"Jetlener of Plewnu• Abaeernent Pornt 7 (Rev. J/7a1 iAPPLICATION FOR ABATEMENT — GENERAL FORM Scott `o Cornplew in triplicate if tax reduction s=eedt $S00; odterwise complete in dupiicats. PU=e print or type. For Taxes Auessed in Year1 9� and Payabie in Year19E AaWIGWWs Nanw JU"" OW"M No. Oate of AgWies C.M. St. P. & P Railroad Comn- 3nee Address city er Fov~ip ZIP Cods 516 W. JapIson Blvd.., Chicago, iZ .60606 APPLICANT'S STATEMENT OF FACTS: The C.M. St. P. & P Railroad is currently under reorganization. According to the Federal Court Order the railroad will pay 100% of the tax, but no penalty. APPLICANT'S REQUEST The penalty on -1984 takes beaabated. Social' Security Number 40 Rt Sivat`ife cow NOTE: i4Ainnsects Stansted 1971. Section 009./1 "riAoerer in rmWnq svy statement, oral or written, wAich is floured or authorised by law to be made bens of Imoosinq, r dud" or among any teat or seeeunent, intentiOnWIV makes anV ttetement ae to anV Intel ai metM which he knom is false MW nnmm*C, un"M ohwYOU xovided bV law, to imWisonnwnt for not more tnein one year or to ororient of a fine of not mos men $1.000. or bom. REPORT OF INVESTIGATION (by Cautay Assaawr or City Assonor in grain cities) I Aereby report that I have invalid @t@d th@ stsanlants mad@ in tM foregoing aooiication and find the tach to be as foilows: ra PARCEL # TAX 78-82 YEAR 27-001119-1 1,268.10 1,125.58 78-83 27-001121-1 2,400.36 2,139.10 78-83 123-1 5,142.14 4,584.30 78-83 126-1 939.54 907.28 78-83 128-0 7o4.o8 491.30 81-83 134-0 117.06 81.68 81-83 901009-0 1,663.42 1,367.62 79-83 12,234.70 10,696.86 4,554.32 16, 789.02 P; PAY 78-82 @ 90% 9,627.18 83 & 100% 1,537.84 84 ® 100% 4,554.32 15,719.34 ABATE 78-82 @ 10% 1,069.68 CPI 5,049.03 6,118.71 oz C mo o m D m Z m m� r -a r a, mm 0z C-) -4 nr A m N H �m Om m C m y m� m _0 V �3 DD �X Dm Wh r= mm ..40 OX _W 4 9--1 2 D-�i0 OOD mC0) zmn ?�C 'mm MDr WWW QCm fa m m DESIGN SYSTEMS, INC. • ST. CLOUD, MN. 56301 H � CS m O D -4r 0 m 00)z -4 -1 {m �D zx Zm M y op �D Ul �m Z ca v 0o 0 b 0 (D I�