HomeMy WebLinkAboutIV.A - Real Estate Option - Rungoli-PanacheREAL EST ATE OPTION AGREEMENT
THIS AGREEMENT,is made on or as of the ~~day of RQ(.~he-.....,2018,by
and between the Hastings Economic Development and Redevelopment Authority in and for the
City of Hastings,a public body corporate and politic under the laws of the State of Minnesota,
(hereinafter referred to as "HEDRA"),having its principal office at 101 4th Street East,Hastings,
Minnesota 55033-1955,and Rungoli LLC,a Minnesota limited liability company (hereinafter
referred to as the "Developer"),having its principal office at 1865 Fairmont Avenue,St.Paul,
Minnesota 55105.
RECITALS
WHEREAS,HEDRA is an economic development and redevelopment authority and is the
owner of certain real property located within the City of Hastings legally described as Outlot A
and Outlot B,Riverfront Addition,Dakota County,Minnesota except that portion thereof platted
as Riverfront Second Addition,Dakota County,Minnesota,represented by Dakota County PIN
19-63950-00-021 and 19-63950-00-0 10 (which real property is referred to herein as the
"Property");and
WHEREAS,HEDRA has identified as one of its objectives the encouraging of economic
development and job growth within the City of Hastings by inducing and assisting new
businesses and organizations to locate in the City for the purposes of creating,fostering,and
preserving affordable new jobs and a diverse visitor destination with a strong focus on the
Mississippi riverfront near the eastern end of downtown Hastings;and
WHEREAS,the Developer is a Minnesota,majority women owned,CERT certified small
business,committed to building an environmentally and economically sustainable local
community;and
WHEREAS,the Developer is desirous of submitting certain proposals for predevelopment
and development funding for a mixed-use project within the City of Hastings which may include
purchase of all or a portion of the Propelty and construction of improvements thereon,all of
which would in tum lead to creation of new commercial opportunities and jobs within the City of
Hastings;and
WHEREAS,the Developer must satisfy certain other conditions before it would be in a
position to purchase the Property and HEDRA is willing to grant to the Developer an option to
purchase the Property,for a limited time period and upon certain conditions,to allow the
Developer to proceed with its preliminary development plans and applications while having the
assurance from HEDRA that the Property will be available for purchase by the Developer,
should the Developer elect to proceed with its development plans and purchase of the Property
after satisfying any and all conditions HEDRA may impose on the development plans and
purchase of the Property;and
WHEREAS,HEDRA is willing to grant an option to the Developer to purchase the
Property,but only if the parties are able to agree on the price by which the Propelty would be
sold to the Developer,and if Developer complies with the construction,employment and other
covenants established by HEDRA;and
WHEREAS,HEDRA may consider providing business subsidy benefits to the Developer
if Developer exercises its option to purchase granted hereunder but cannot grant or commit to
granting such business subsidies unless and until Developer exercises its option to purchase the
Property;and
WHEREAS,Developer and HEDRA have agreed to the terms of that certain Letter of
Intent (undated)on file with HEDRA ("Letter of Intent")and this Agreement is made in
furtherance of the terms thereof.
NOW,THEREFORE,in consideration of mutual covenants and obligations of the parties
hereto,each of them does hereby covenant and agree with the other as follows:
1.GRANT OF OPTION.For good and valuable consideration,including the option
payment of one thousand and noll 00 dollars ($1,000.00)paid by Developer to HEDRA upon
execution of this Agreement and as provided for in the Letter of Intent,the receipt of which is
hereby acknowledged by HEDRA,HEDRA hereby grants to the Developer a right and option upon
the terms and conditions hereinafter set forth,to purchase the Propelty.
2.OPTION TERM.The term of the option to purchase the Property shall commence
from the date of this Agreement and shall terminate on June 1,2019.
3.OPTION PRICE.If the Developer elects to exercise the option within the time
specified in Paragraph 2,the purchase price for the Property shall be determined upon agreement
between HEDRA and Developer based on application of HEDRA's policies for promoting
development and redevelopment and taking into consideration funding Developer is able to obtain
and apply toward the purchase price and which price shall be memorialized in a Development
Agreement ("Development Agreement")establishing any obligations of the Developer,in addition
to payment of the purchase price,to satisfy celtain employment,wage and construction
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requirements within specified times complying with HEDRA's objectives for encouraging
economic development and job growth within the City of Hastings.The specific tem1S of the
Development Agreement shall be established by HEDRA and the City of Hastings.The Developer
acknowledges and agrees that if the Developer elects to exercise the option hereunder,the
conveyance and sale of the Property to the Developer may be subject to the requirements of Minn.
Stat.§§1161.993 -1161.995 (the "Business Subsidy Act").Developer agrees and acknowledges
that neither HEDRA nor the City of Hastings can commit to advancing any business subsidies
unless and until Developer exercises its option to purchase the Property and upon that occurrence
the final decision whether to grant,or not grant,business subsidies to the Developer will be within
the sole and absolute discretion of the then governing bodies of HEDRA and the City of Hastings,
and will be subject to all laws and regulations governing business subsidies in effect at that time.
4.PERMITTED ENCUMBRANCES.In the event the Developer exercises the option
contained herein,the conveyance by HEDRA of the Property shall be subject to the following
permitted encumbrances:the obligations and restrictions contained in the Development
Agreement and any agreement required under the Business Subsidy Act;reservations of minerals
or mineral rights to the State of Minnesota;public utility,roadway and other easements which
will not adversely affect the development and use of the Property pursuant to the Developer's
construction plans;environmental covenants which may be imposed as a result of environmental
remediation on the Property;easements for overhead powerlines currently in place on the
Property;building laws,regulations and ordinances consistent with the proposed improvements;
real estate taxes that the Developer agrees to payor assume pursuant to the Development
Agreement;restrictions,covenants and easements of record that do not materially adversely
affect the development and use of the proposed improvements;and exceptions to title to the
Property which are not objected to by the Developer upon examination of the title evidence to be
delivered to the Developer pursuant to the Development Agreement.
5.DATE OF CLOSING.The date of closing shall be a date mutually agreed upon by
the Developer and HEDRA which date shall not be earlier than 30 days nor more than 1 year after
the date of the exercise of the option.
6.TAXES AND ASSESSMENTS.HEDRA shall pay at closing all real estate taxes
and installments of special assessments due in all years prior to the year of closing.Real estate
taxes and special assessments due in the year of closing shall be prorated between the parties.The
Developer shall pay all real estate taxes and installments of special assessments due and payable in
the year following the year of closing and subsequent years.
7.TITLE AND REMEDIES.HEDRA shall within a reasonable time after notification by
the Developer of the exercise of the option provide for the Developer's inspection an Abstract of
Title certified to date,or at HEDRA'S option,a commitment for an owner's policy of title
insurance,including proper searches covering bankruptcies,state and federal judgments and liens.
The Developer shall be allowed 10 days after receipt iliereof for examination of said title and the
making of any objections thereto,said objections to be made in writing or deemed to be waived.If
any objections are so made the Developer shall be allowed to rescind the transaction in which event
HEDRA shall refund to the Developer any payments made pursuant to the terms of this Agreement,
or if HEDRA elects to remedy said title objections,HEDRA shall be allowed 60 days to make such
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title marketable.Pending correction of the title the date of closing shall be postponed but upon
correction of the title and within 30 days after written notice to the Developer the closing shall
occur.If said title is not marketable and is not so made within 60 days from the date of the written
objections thereto as above provided,this Agreement shall be null and void at the option of the
Developer and HEDRA shall refund to the Developer any of the payments made pursuant to the
terms of this Agreement and neither party shall be liable for damages to the other party.
8.EXERCISE OF OPTION AND CLOSING.In the event the Developer desires to
exercise the option herein granted,the Developer shall notify HEDRA in writing of the Developer's
intent to do so and such notice shall be deemed to have been duly given if delivered in person or
deposited in the United States Mail,postage prepaid,for mailing by celtified or registered mail,
retum receipt requested,to HEDRA at the address set forth in the initial paragraph of this
Agreement.Upon receipt of such notice,the parties shall negotiate in good faith to agree on the
purchase price for the Property.If the parties do not agree in writing on the purchase price of the
Property within 60 days after receipt of such notice,or if the Developer does not exercise the option
herein granted prior to expiration of the option telm,the obligations of the parties hereunder shall
automatically terminate,the parties shall execute and exchange a document confirming the
termination of the option rights hereunder upon request by either party,the option payment made by
the Developer to HEDRA upon execution of this Agreement and as provided for in the Letter of
Intent shall be refunded to Developer,and neither party shall have any futther obligation to the other
under this Agreement.
9.NO PARTNERSHIP OR JOINT VENTURE CREATED HEREBY.Nothing
contained in this Agreement shall be interpreted as creating a pattnership or joint venture between
the Developer and HEDRA relative to the Property.
10.ASSIGNMENT.The Developer may not assign its intcrest in this Agreement
without the prior written consent of HEDRA,which consent may be granted or withheld in the sole
and absolute discretion of HEDRA.An Lmconsented assignment by the Developer shall be void,
and at the option ofHEDRA,shall be grounds for the termination of this Agreement.
11.AMENDMENT,MODIFICATION,OR WAIVER.No amendment,modification,
or waiver of any condition,provision,or term shall be valid or of any effect unless made in writing,
signed by the party or parties to be bound or a duly authorized representative,and specifying with
particularity the extent and nature of such amendment,modification,or waiver.Any waiver by any
party of any default of another patty shall not affect or impair any right arising from any subsequent
default.Except as expressly and specifically stated otherwise,nothing herein shall limit the
remedies and rights of the parties hereto under and pursuant to this Agreement.
12.SEVERABLE PROVISIONS.Each provision,section,sentence,clause,phrase,
and word of this Agreement is intended to be severable.If any provision,section,sentence,clause,
phrase,and word hereof is illegal or invalid for any reason whatsoever,such illegality or invalidity
shall not affect the validity of the remainder of this Agreement.
13.CAPTIONS,HEADINGS,OR TITLES.All captions,headings,or titles in the
paragraphs or sections of this Agreement are inserted for convenience of reference only and shall
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not constitute a part of this Agreement as a limitation of the scope of the particular paragraphs or
sections to which the apply.
14.MINNESOTA LAW.This Agreement shall be construed and enforced in
accordance with the laws of the State of Minnesota and any dispute shall be venued in the Dakota
County District Court.
,If-
1'l IN WITNESS WHEREOF,the parties have executed this Agreement effective the ·7 day
of dX.&,2018.
Dated:12/0r/,2018rI
RUNGOLILLC
A Minnesota limited l'
By:An eeta Iaiswal-Dale
Its:CKD
ACKNOWLEDGMENT
STATE OF MINNESOTA )
)ss.
)COUNTYOF _
The foregoing instrument was acknowledged before me this __day of .
2018,by Ameeta Iaiswal-Dale,the of Rungoli LLC,a Minnesota limited
liability company.
Notary Public
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Hastings Economic Development and
Redevelopment Authority in and for
the City of Hastings,a public body corporate and
politic under the laws of the State of Minnesota
Dated:,2018-------
By:----------------Pamela Denning,Its President
(SEAL)
ACKNOWLEDGMENT
STATE OF MINNESOTA)
)ss.
COUNTY OF DAKOr A )
The foregoing instrument was acknowledged before me this __day of _
2018,by Pamela Denning,the President of the Hastings Economic Development and
Redevelopment Authority in and for the City of Hastings,a public body corporate and politic
under the laws of the State of Minnesota.
Notary Public
THIS INSTRUMENT DRAFTED BY:
FLUEGEL LAW FIRM P.A.
999 Westview Drive,Suite #1
Hastings,MN 55033
651-438-9777
(DAN/ksk)
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