08.a Scandia Heritage Alliance Lease Agreement and DEED Resolutions Staff Report
Date of Meeting: November 18, 2025
For: Honorable Mayor and Council
From: Kyle Morell, City Administrator
Subject: Discussion on Public Forum of Regular Meeting
Sue Rodsjo and John Hermain of the Scanda Heritage Alliance (Alliance) will be at the meeting to
answer any questions the Council may have about the Lease Agreement or the two required DEED
Resolutions. The Lease Agreement is for the Alliance's use of the City property for the construction
and operation of the Water Tower Barn. DEED requires the resolutions as part of the grant the
City received in 2023. Once the resolutions are approved, the Council will be presented with the
DEED Grant Agreement for approval at their December meeting.
Also attached is a letter from John Herman to the City, asking the City to waive the Project
Performance Bond requirement for the Water Tower Barn and to join the SHA in asking DEED to
do the same. This letter will be presented to the Council for discussion.
The Alliance has two additional requests of the City Council that were not mentioned at the Work
Session. First, they would like the City to partner with them in requesting that DEED waive the
bonding requirement for their general contractor. John Herman has drafted a letter that explains the
Alliance’s request, which is included. Second, the Alliance would like the City to submit a DNR
Parks and Recreation Grant to cover half the cost of the splash pad. This is the same grant the City
applied for when it upgraded the City Hall Playground.
Attachments:
SHA Lease Agreement with the City of Scandia
Resolution No. 11-18-25-08 Authorizing Acceptance of State Grant and
Resolution No. 11-18-25-09 Authorizing the Mayor, City Administrator or the City Clerk to
Enter into Agreements and Undertake Activities to Complete the Scandia Water Tower
Barn Arts and Heritage Center Project
Letter from John Herman to DEED requesting a waiver of the bonding requirement for
their general contractor
L E A S E / U S E A G R E E M E N T
by and between
City of Scandia, as Lessor
and
Scandia Heritage Alliance, as Lessee and User
_____________, 2026
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TABLE OF CONTENTS
1. PURPOSE. . ................................................................................................................. 1
2. DEMISE AND DESCRIPTION OF PREMISES.. ....................................................... 2
3. GRANT AGREEMENT ............................................................................................... 2
4. TERM AND OPTIONS TO RENEW. ........................................................................ 3
5. STATUTORY TERMINATION AND TIME FOR LEGISLATIVE
RECONSIDERATION. ................................................................................................ 3
6. RENT.. .......................................................................................................................... 4
7. PAYMENT OF TAXES AND ASSESSMENTS. ........................................................ 4
8. PAYMENT OF UTILITIES. ........................................................................................ 6
9. REPORTING AND PROGRAM OVERSIGHT. ......................................................... 6
10. LESSEE REPRESENTATIONS, WARRANTIES AND COVENANTS. ................ 6
11. LESSOR REPRESENTATIONS, WARRANTIES AND COVENANTS. .................. 8
12. WARRANTIES OF TITLE AND QUIET POSSESSION. .......................................... 9
13. USE OF PREMISES. .................................................................................................... 9
14. ABANDONMENT OF PREMISES. ............................................................................ 9
15. LESSOR’S RIGHT OF ENTRY.. ................................................................................. 9
16. ENCUMBRANCE OF LESSEE’S LEASEHOLD INTEREST. ................................ 10
17. EARLY TERMINATION OF THIS LEASE. ............................................................ 10
19. NOTICES. ................................................................................................................... 13
20. CONSTRUCTION OF IMPROVEMENTS.. ............................................................. 14
21. CONSTRUCTION OF ADDITIONAL BUILDINGS AND IMPROVEMENTS. .. 14
23. REPAIRS AND DESTRUCTION OF IMPROVEMENTS. ...................................... 15
24. MECHANICS’ LIENS. ............................................................................................... 16
25. INDEMNIFICATION OF LESSOR. .......................................................................... 16
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26. INSURANCE. ............................................................................................................. 18
27. PROHIBITION OF INVOLUNTARY ASSIGNMENT. ........................................... 20
28. EVENTS OF LESSEE DEFAULT. ............................................................................ 20
29. NOTICE OF DEFAULT. ............................................................................................ 22
30. INTENTIONALLY OMITTED. ................................................................................. 23
31. ADDITIONAL REMEDIES. ...................................................................................... 23
32. SPECIAL TERMINATION PROCEDURE. .............................................................. 23
33. LESSOR’S RIGHT TO PERFORM.. ......................................................................... 24
34. LESSOR DEFAULTS AND TENANT’S LIMITED REMEDIES. ........................... 24
35. NO REMEDY EXCLUSIVE.. .................................................................................... 25
36. EFFECT OF EMINENT DOMAIN. ........................................................................... 25
37. SURRENDER OF LEASE: EFFECT ON SUBLEASES.. ......................................... 26
38. INTENTIONALLY OMITTED. ................................................................................. 26
39. AMENDMENT, MODIFICATION, AND WAIVER. ............................................... 26
40. APPROVAL BY STATE OF MINNESOTA. ............................................................ 26
41. EFFECT OF LESSEE’S HOLDING OVER. ............................................................. 26
42. PARTIES BOUND.. ................................................................................................... 26
43. TIME OF ESSENCE. .................................................................................................. 26
44. CAPTIONS. ................................................................................................................ 27
45. NO PARTNERSHIP, JOINT VENTURE, OR FIDUCIARY RELATIONSHIP
CREATED HEREBY. ................................................................................................ 27
46. CUMULATIVE RIGHTS. .......................................................................................... 27
47. SEVERABLE PROVISIONS. .................................................................................... 27
48. ENTIRE AGREEMENT.. ........................................................................................... 27
49. REFERENCE TO GENDER. ..................................................................................... 27
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50. MINNESOTA LAW, JURISDICTION AND VENUE.. ............................................ 27
51. FURTHER ASSURANCES. ....................................................................................... 27
52. SHORT-FORM RECORDABLE LEASE. ................................................................. 28
53. FEDERAL INCOME TAX DEDUCTIONS.. ............................................................ 28
54. BROKERAGE FEES.. ................................................................................................ 28
55. INTENTIONALLY OMITTED. ................................................................................. 28
56. LISTING OF JOBS. .................................................................................................... 28
57. RECORD KEEPING AND REPORTING. ................................................................ 29
58. NON-DISCRIMINATION. ........................................................................................ 29
59. INTENTIONALLY OMITTED .................................................................................. 29
60. PREVAILING WAGE. ............................................................................................... 29
61. INTENTIONALLY OMITTED. ................................................................................. 29
62. REVIEW OF PLANS AND COST ESTIMATES...................................................... 29
63. HAZARDOUS WASTE POLLUTION AND CONTAMINANTS. .......................... 30
64. WAIVER OF SUBROGATION. ................................................................................ 31
65. WAIVER OF CERTAIN DAMAGES. ....................................................................... 31
66. COMPLIANCE WITH LAWS. .................................................................................. 32
67. INTENTIONALLY OMITTED. ................................................................................. 32
68. GRANT AGREEMENT PREVAILS.. ....................................................................... 32
69. RECITALS. ................................................................................................................. 32
70. EXHIBITS INCORPORATED. .................................................................................. 32
EXHIBIT A – LEGAL DESCRIPTION
EXHIBIT B – IMPROVEMENTS
EXHIBIT C – GRANT AGREEMENT
EXHIBIT D – PERCENTAGES AND SOURCES OF PROJECT FUNDS
EXHIBIT E – ALLOCATION PERCENTAGES
EXHIBIT F – PERMITTED ENCUMBRANCES
LEASE AND USE AGREEMENT
Water Tower Barn Scandia Arts and Heritage Center
THIS LEASE AND USE AGREEMENT (this “Agreement” or “Lease”) is entered into
this __ day of ______, 2025, by and between the CITY OF SCANDIA, MINNESOTA, a
Minnesota statutory city, (“Lessor”) and SCANDIA HERITAGE ALLIANCE, a Minnesota
nonprofit corporation (“Lessee” or “SHA”).
RECITALS
A. Under the authority contained under Minnesota law, such as those set forth in
Minn. Stat. §§471.15 and 471.16 (Recreational Facilities by Municipality and Operation of
Program, respectively). 471.191 (cultural facilities, museums, concert halls), and 471.193
(historical preservation) (the “Statutory Authority”) and the specific language contained in
2023 Minn. Laws, Ch. 73, Art. 2, Sec. 9, Subd. 7 (the “Grant Legislation”), the State of
Minnesota (the “State”) has allocated $2,200,000 of general fund monies for a grant (the
“Grant”) to the City to partially fund predesign, design, construct, furnish, and equip the
Water Tower Barn Scandia Arts and Heritage Center consisting of the restoration of the
historic Scandia Water Tower Barn, an amphitheater, other recreational facilities, and
associated site improvements (the “Project”). The Project will allow operation of a program
consisting of some or all of the following: museum, arts and heritage center, educational and
recreational programs and facilities, an outdoor amphitheater, theater and event space in the
restored Water Tower Barn, and other uses compatible therewith (the “Governmental
Program”);
B. The City is the fee owner of the real property on which the Project will be
constructed and has agreed to lease the Project site in the City community commons, legally
described in Exhibit A (the “Premises”) to SHA as the Lessee to provide the Governmental
Program. This Lease is for an initial term of seventeen and one-half (17.5) years with
subsequent renewals as provided herein. The initial term is less than half of the useful life of
the facility; and
C. SHA has demonstrated its capability to undertake the Project construction and
to operate the Governmental Program as contemplated by the Grant Legislation, and the City
desires to lease the Premises to SHA to construct the Project and use the Premises to provide
the Governmental Program, as more fully provided herein.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, Lessor and Lessee hereby agree as follows:
1. PURPOSE. Lessor believes that it serves the public interest of the City to
construct the Project to provide facilities for the Governmental Program in the City, consistent
with the Statutory Authority of the City and the Grant Legislation. The City believes the
Project will serve the St. Croix Valley region and provide multiple economic, cultural, historic,
and recreational benefits to the citizens of the City and Region. The City has acted by
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Resolution Nos. ________, Dated______________ to accept the Grant and to enter into this
Agreement with SHA, to construct the Project and provide the programming to achieve the
City’s goals of furthering economic development in the City and enriching the cultural,
recreational, and civic life of the City. This Agreement is being entered into in accordance
with the provisions of the Grant Legislation and the Grant Agreement between the State [acting
through its Department of Economic Development (“DEED”)] and the City. SHA has raised
sufficient funds from other public and private sources to fully fund the Project and to operate
the Governmental Program and desires to provide this programming and enter into this Lease
with the City.
2. DEMISE AND DESCRIPTION OF PREMISES. In consideration of the mutual
promises and covenants contained herein, Lessor hereby leases to Lessee, and Lessee hereby
leases from Lessor the Premises, as described in Exhibit A attached hereto, together with all
improvements (as further defined in Section 21 of this Lease and generally described on the
attached Exhibit B, the “Project” or the “Improvements”) to be constructed thereon. The
Premises are leased to Lessee on an AS-IS basis and Lessee acknowledges that Lessor has
made no representations or warranties as to the condition, quality, buildability, or suitability
for development of the Premises.
Lessee’s rights and interest in the Premises are subject to the Grant Agreement,
provided in Section 3 hereof.
3. GRANT AGREEMENT. Lessor and Lessee acknowledge that the costs of
design and construction of the Improvements on the Premises will be funded in part through
the proceeds of a State general fund grant in the amount of $2,200,000 from the State acting
by and through DEED. The Grant is being made to Lessor pursuant to the terms of a Grant
Agreement - Construction Grant for the Scandia Water Tower Barn (the “Grant Agreement”),
a copy of which is attached hereto as Exhibit C. Capitalized terms set forth in the Grant
Agreement shall have the meanings assigned therein, unless otherwise provided.
Lessor agrees to comply with all terms and conditions of the Grant Agreement (unless
Lessor’s failure to comply is the result of Lessee’s failure to comply with the terms and
conditions of this Lease). Lessee acknowledges the terms of the Grant Agreement and will
cooperate fully with Lessor in complying with such terms. Lessor and Lessee further agree
that in the event that either party fails to comply with any provision in the Grant Agreement
then, if the non-complying party fails to cure such failure within sixty (60) days of receipt of
a written demand or the State’s notice of default, then the other party shall have the right to
take such action to effect the cure or trigger other remedies available under this Lease.
This Lease requires Lessee to comply with the Grant Agreement and to fulfill certain
obligations therein, which are set out more fully herein. Lessor shall not agree to any
amendment, modification or waiver of any condition, provision or term of the Grant
Agreement, that would adversely impact the rights of Lessee hereunder, unless first approved
in writing by Lessee. Lessor agrees that it will provide Lessee with copies of all notices that
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are provided to Lessor as the “Public Entity” under the Grant Agreement in accordance with
Section 20 hereof.
4. TERM AND OPTIONS TO RENEW. The initial term of this Lease shall be for
seventeen and one-half (17.5) years, commencing on the date of this Agreement, and ending
____________________, unless sooner terminated as hereinafter provided. Notwithstanding
the foregoing sentence, upon completion of construction of the Project, Lessor and Lessee
agree this Lease will be automatically amended to increase the ending date of the initial term
to that date which is seventeen and one-half (17.5) years from the Completion Date, as defined
in Section 21 of this Lease. This term is less than 50% of the useful life of the Project. As
used herein, “Term” refers to the initial term and to any renewal thereof as herein provided.
Subject to the conditions set forth below, Lessee shall renew this Lease for three
successive periods, the first of which shall be for seventeen and one-half (17.5) years and the
second of which shall be for eight and three-quarters (8.75) years. Upon the expiration of the
second renewal Term, the City and SHA agree they will negotiate a further extension of this
Lease for a further Term of fifty-five and one-quarter (55.25) years (to make a total Term of
99-years), as previously approved by the City, on terms and conditions substantially the same
as provided in this Lease, except that the State provisions related to the Grant Agreement shall
no longer apply and shall be removed. Lessor and Lessee agree to communicate in the six
months prior to each renewal Term regarding these extensions.
Before each renewal, the Lessor shall be reasonably satisfied that Lessee has sufficient
capacity, including but not limited to financial and staffing capacity and qualifications, to
perform its obligations hereunder. Each renewal shall be automatic, unless the City in its
reasonable discretion, as Lessor shall have determined by action of its City Council that the
Lessee is no longer able to carry out the Governmental Program (or such comparable program
as the City approves). Absent a determination that the Lessee is not suited and able to perform
the functions contained in this Lease, the Lessor shall act in good faith to renew this Lease.
Provided, in no event shall Lessee be entitled to renew the term hereof, if (a) the Lease
has been terminated, or (b) a Default has occurred and is continuing as of the date of the
expiration of the initial or renewal term.
5. STATUTORY TERMINATION AND TIME FOR LEGISLATIVE
RECONSIDERATION.
a. Notwithstanding any other provisions of this Lease to the contrary, if
the Governmental Program is terminated or changed in response to changes in state
law in such a manner as to cause this Lease and the operation of the Project to be
inconsistent with the changed Governmental Program, then this Lease may, at the
option of Lessor, be terminated by 485 days written notice to Lessee, provided
however that Lessor agrees that it will not terminate or change the Governmental
Program unless required to do so by applicable State law. Any termination must be
approved by the City Council of the City and provided further that any termination
pursuant to this Section 5 will be deemed automatically rescinded and of no force or
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effect if, within said 485 day period, either (i) the State law requiring the
Governmental Program to be terminated or changed is repealed or modified in such a
manner as to permit the Governmental Program to continue in a form that does not
cause this Lease and operation by SHA on the Premises to be inconsistent therewith,
or (ii) Lessee conforms its operation of the Premises to the changed Governmental
Program.
b. Notwithstanding any other provisions of this Lease to the contrary, if the
State law that provides the statutory authority under which Lessor is operating the
Governmental Program is repealed or modified in a manner that would prevent Lessor
from operating the Governmental Program (“Repealing or Modifying Law”), then
Lessor and Lessee shall cease the operation of the Project by SHA 485 days after
written notice described in Section 5.a. above (“Termination Date”), if such written
notice is given by Lessor and not rescinded. Either Lessor’s or Lessee’s failure to cease
operation by SHA of the Project on the Termination Date shall be a Default under this
Lease without the requirement of notice of such failure and without any cure period;
provided, however, if the Repealing or Modifying Law is repealed or modified in such
a manner as to reinstate Lessor’s statutory authority to operate the Governmental
Program, then Lessor and Lessee shall no longer be required to cease operation of the
Governmental Program.
c. The parties agree to use their best efforts and cooperate in a good faith
attempt to obtain State legislation that permits the Governmental Program and this
Lease to continue.
6. RENT. No “base” rent is required to be paid by Lessee for the initial or renewal
Terms provided herein, however, it is the intention of the parties that this Lease is a complete
“net” lease and that all costs and expenses, of any nature or kind whatsoever, attributable to
the Premises or Lessee’s use thereof during the Term or any renewals hereof, including but
not limited to the costs of operation of the Governmental Program, shall be the sole
responsibility of Lessee, and Lessor shall not have any liability therefor, all such amounts to
be “Additional Rent” as provided in Section 7.
7. PAYMENT OF TAXES AND ASSESSMENTS.
a. Taxes as Additional Rental. As “Additional Rent” hereunder, Lessee
shall pay and discharge as they become due, promptly and before delinquency, all real
estate taxes, assessments, levies, governmental charges, whether general or special,
including all governmental charges of any kind which shall be levied, assessed,
charged, or imposed, , or which may become a lien or charge on or against the Premises,
the Leasehold interest, or the Improvements, or any part thereof, excepting only those
taxes being validly contested as provided in subsection d.
b. Assessments Affecting Improvements. Specifically, but without in any
way limiting the generality of the requirements of subsection a., Lessee shall pay all
special assessments and levies or charges made by any municipal or political
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subdivision for local improvements before they shall become delinquent, or in
installments each year as assessed by any such municipal or political subdivision. If,
by making any such election to pay in installments, any such installments shall be
payable after the termination of this Lease such unpaid installments shall be prorated
as of the date of termination and amounts payable after such date shall be paid by
Lessor.
c. Proration. All of the taxes and any other charges under this Section shall
be prorated at the commencement and expiration of the term hereof.
d. Contesting Taxes. If Lessee shall in good faith desire to contest the
validity or amount of any tax, assessment, levy, or other governmental charge herein
agreed to be paid by Lessee, and to the extent permitted by law Lessee shall be
permitted to do so and to defer payment of such tax or charge, until final determination
of the contest. Lessee shall give Lessor written notice thereof prior to the
commencement of any such contest. Provided, however, that Lessee shall be absolutely
obligated to pay such tax or charge when required by law and absolutely no later than
30 days before such unpaid tax or charge will result in a forfeiture of the Premises or
any part thereof and Lessee shall diligently pursue such contest to settlement, resolution
and completion.
e. Disposition of Rebates. All rebates on account of any such taxes, rates,
levies, charges, or assessments required to be paid and paid by Lessee under the
provisions hereof shall belong to Lessee, and Lessor will on the request of Lessee
execute any documents that may be necessary in order to secure such rebates payable
to Lessor.
f. Lessor’s Right to Pay Taxes and Fees on Behalf of Lessee. In the event
Lessee shall fail to comply with the preceding terms of this Section, Lessor may, but
shall not be obligated to, pay any such taxes or assessments, including Lessor’s
expenses (including City’s internal staff time), including attorney’s fees, and charge
all of them against Lessee, plus interest on the entire amount at a rate of 8% per annum
from the date paid, as Additional Rent immediately due and payable, subject, however,
to subsections d. and (e) above.
g. Receipts. Lessee shall at the request of Lessor obtain and deliver to
Lessor proof of payment for all taxes, assessments, levy, governmental charges, and
other items required to be paid by Lessee.
h. Acknowledgement. Lessee acknowledges that Lessor has made no
representations or warranties of any kind with respect to the amount of any real estate
taxes, special assessments, or other charges which may be levied against the Premises.
Lessor agrees to cooperate with Lessee in the taking of any reasonable action
determined by Lessee to be necessary to obtain or maintain tax exempt status for
Lessee’s use of the Premises, provided, however, that Lessee shall be responsible for
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any actual out of pocket costs and expenses incurred by Lessor in connection with such
cooperation.
i. Reimbursement. Lessee shall pay or reimburse for any of Lessor’s
consultant or professional fees and expenses, including attorney’s fees and costs
incurred for drafting, executing, and implementing any and all leases and agreements
including but not limited to Grant Agreement, Government Program, or Premises and
Improvements. Lessee shall promptly reimburse Lessor for any payments or expenses
Lessor made or incurred that under this Agreement that were or are Lessee’s
responsibility.
8. PAYMENT OF UTILITIES. As Additional Rent, Lessee shall fully and
promptly pay when due for all water, sewer, gas, heat, light, power, telecommunications, and
all other utilities of every kind furnished to the Premises throughout the Term hereof and any
renewals, and Lessor shall have no responsibility of any kind for any thereof.
9. REPORTING AND PROGRAM OVERSIGHT.
a. Lessee shall submit to the City, upon written request, which shall not be
more often than annually, such documentation, information and reports as are needed
by the City to assure the Lessee is providing the Governmental Program and to allow
Lessor to file the annual reports to the State required by the Grant Agreement. Such
information may include:
i) A report of major activities at the Project for the current fiscal
year of Lessee, and a description of how the major activities meet the elements
of the Governmental Program; and
ii) Lessee’s operating budget for the current fiscal year, including
revenues and expenses that demonstrates revenues equal to or exceeding
forecast program expenses.
The Lessee shall meet with the City Designee and respond to any questions or requests
for further information in connection with the foregoing.
10. LESSEE REPRESENTATIONS, WARRANTIES AND COVENANTS.
Lessee covenants with and warrants and represents to Lessor as follows:
a. It has legal authority to enter into, execute, and deliver this Lease, and
that it has taken all corporate and other actions necessary and incident to its execution
and delivery of such documents.
b. It will comply with all of the terms, conditions, covenants, requirements,
and/or warranties in this Lease, at all times during the term hereof.
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c. It will comply with the terms, conditions, covenants, requirements and/or
warranties in the Grant Agreement.
d. It will construct the Improvements and operate the Project in compliance
with this Lease and the Grant Agreement.
e. It has made no material false statement, or material misstatement of fact,
in connection with its receipt of this Lease, and all of the information previously
submitted to Lessor or the State, relating to this Lease or the Grant or the disbursement
of any of the proceeds of the Grant, is and will be true, complete and correct by Lessee
in all material respects.
f. The execution and delivery of this Lease by Lessee will not constitute a
violation of any provisions of its Articles of Incorporation or Bylaws, or of the laws of
the State, and there are no actions, suits, or proceedings pending, or to the actual
knowledge of the undersigned officers of Lessee, threatened, before or by any judicial
body or governmental authority against or affecting it relating to the Premises, and it is
not in default with respect to any order, writ, injunction, decree, or demand of any court
or any governmental authority which would impair its ability to enter into this Lease,
or to perform any of the acts required of it in this Lease.
g. Neither the execution or delivery of this Lease, nor compliance with any
of the terms, conditions, requirements, or provisions contained herein, is prevented by,
is a breach of, or will result in a breach of any term, condition, or provision of any
agreement or document to which it is now a party, or by which it, or any of its
properties, is bound.
h. Subject to Unavoidable Delays (as defined in the Section 21), by no later
than the Completion Date, the Improvements will be substantially completed in such a
manner as will allow the Governmental Program to be operated in the manner specified
in Section 1 of this Lease.
i. As of the date hereof, the Premises and the contemplated use thereof will
not violate in any material respect any applicable zoning or use statute, ordinance,
building code, rule or regulation, or any covenant or agreement of record, relating to
the Premises.
j. The construction of the Improvements will be performed in material
compliance with all applicable laws, statutes, rules, ordinances, and regulations,
including but not limited to building code, disability, access, zoning, air quality,
pollution control, and prevailing wage requirements as issued by any federal, state, or
local political subdivisions having jurisdiction over the Premises.
k. All applicable licenses, permits, and other conditions required for the
construction of the Improvements have been or shall be obtained.
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l. It has not taken and will not take any actions inconsistent with this Lease.
m. It has reviewed the City’s title to the Premises and determined that the
City’s ownership and title is adequate and sufficient and waives any title objections,
conditions, or claims it may have as of the date of this Agreement, subject to City’s
obligation to advise of any known title issues as of the closing.
11. LESSOR REPRESENTATIONS, WARRANTIES AND COVENANTS.
Lessor covenants with and warrants and represents to Lessee as follows:
a. It has legal authority to enter into, execute, and deliver this Lease, and
that it has taken all official and other actions necessary and incident to its execution and
delivery of such documents.
b. It will comply with all of the terms, conditions, covenants, requirements,
and/or warranties in this Lease applicable to Lessor at all times during the term hereof.
c. It will comply with all of the terms, conditions, covenants, requirements
and/or warranties in the Grant Agreement and any applicable DEED or other State
requirements, subject to Lessee’s compliance with all terms and conditions of this
Lease.
d. The execution and delivery of this Lease by Lessor will not constitute a
violation of any provisions of the laws of the State, and there are no actions, suits, or
proceedings pending, or to the actual knowledge of the undersigned officers of Lessor,
threatened, before or by any judicial body or governmental authority against or
affecting it relating to the Premises, and it is not in default with respect to any order,
writ, injunction, decree, or demand of any court or any governmental authority which
would impair its ability to enter into this Lease, or to perform any of the acts required
of it in this Lease.
e. Neither the execution or delivery of this Lease, nor compliance with any
of the terms, conditions, requirements, or provisions contained herein, is prevented by,
is a breach of, or will result in a breach of any term, condition, or provision of any
agreement or document to which it is now a party, or by which it is bound.
f. It has made no material false statement, or material misstatement of fact,
in connection with its execution of this Lease, and all of the information previously
submitted to Lessee or the State, or to be submitted to Lessee or the State in the future,
relating to this Lease or the Grant or the disbursement of any of the proceeds of the
Grant, is and will be true, complete and correct by Lessor in all material respects.
g. It has not taken and will not take any actions inconsistent with this
Lease.
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12. WARRANTIES OF TITLE AND QUIET POSSESSION. City has full right to
make this Lease subject to the provisions hereof, and, assuming SHA fully performs as
required by this Lease, SHA shall have quiet and peaceable possession of the Premises during
the term hereof and any renewals as against the acts of all parties claiming title to or a right to
the possession of the Premises, with the exception, however, of the following:
a. Easements, covenants, conditions, restrictions, and limitations, if any, set
forth on Exhibit D;
b. Reservation of any minerals or mineral rights reserved to the State of
Minnesota;
c. Building and zoning laws, ordinances, and State and federal regulations;
and
d. Any liens or other encumbrances created by Lessee.
13. USE OF PREMISES. Subject to the other terms and provisions contained
herein, Lessee shall be permitted to use the Premises for the construction of the Project and for
construction of additional buildings and improvements pursuant to Section 22 herein,
maintenance and repair of the Premises, and operation of the Project to achieve the
Governmental Program. The Project has been approved by Lessor through Resolution No.
____and other City Resolutions prior to entry into this Lease.
No use shall be made or shall be permitted to be made of the Premises nor shall any
acts be done which will cause a cancellation of any insurance policy covering any building
located on the Premises, or any part thereof. Lessee shall, at its sole cost, comply with all
requirements pertaining to the Premises of any insurance covering the improvements on the
Premises.
Furthermore, during the term of this Lease, Lessee shall comply with all applicable
laws affecting the Premises, including: (a) the breach of such laws might result in any penalty
on Lessor or the forfeiture of Lessor’s title to the Premises; or (b) the breach of which would
have an adverse effect on public health or safety. Lessee shall not commit or allow to be
committed any waste of or nuisance on the Premises. Throughout the term of this Lease, the
operation of the Governmental Program on the Premises shall be subject to Unavoidable
Delays, as defined in Section 21 herein.
14. ABANDONMENT OF PREMISES. If Lessee shall abandon, vacate, or
surrender the Premises or shall be dispossessed by process of law, or otherwise, any personal
property belonging to Lessee and left on the Premises shall be deemed to be abandoned, at the
option of Lessor.
15. LESSOR’S RIGHT OF ENTRY. Lessee shall permit Lessor and the agents and
employees of Lessor to enter into and on the Premises at all reasonable times during business
hours and with at least five days’ written notice for the purpose of inspecting them or for the
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purpose of posting notices of non-responsibility for alterations, additions, or repairs, without
any charge to Lessor and without any liability to Lessor for any loss of occupancy or quiet
enjoyment of the Premises.
16. ENCUMBRANCE OF LESSEE’S LEASEHOLD INTEREST. Lessee may
encumber by mortgage or other proper instrument its leasehold interest in the Premises
including all buildings and Improvements thereon, as security for any indebtedness of Lessee
incurred to finance or refinance Improvements on the Premises provided such mortgage
contains an acknowledgement that the mortgagee’s rights are subject to the rights of Lessor
under this Lease and the rights of the State under the Grant Agreement. Any such lien shall
give Lessee access to insurance and condemnation proceeds so as to allow Lessee the right to
rebuild or restore any portions of the Premises destroyed or condemned in the event that Lessor
permits such rebuilding or restoration under the terms of this Lease. No such encumbrance,
or any foreclosure, conveyance, or exercise of right by any secured lender shall relieve Lessee
from its liabilities hereunder, nor prevent Lessor from exercising its rights herein to terminate
the Lease.
If Lessee shall so encumber its leasehold interest and if Lessee or the holder of the
indebtedness secured by such encumbrance shall give notice to Lessor of the existence thereof
and the address of such holder, then Lessor will mail or deliver to such holder at that address
a duplicate copy of all notices in writing which Lessor may, from time to time, give to or serve
on Lessee under and pursuant to the terms and provisions hereof. Such copies shall be mailed
or delivered to such holder at or as near as possible to the same time such notices are given to
or served on Lessee.
Such holder may, at its option, at any time before the rights of Lessee shall be
terminated as provided herein, pay any of the amounts due hereunder or pay any taxes and
assessments or do any other act or thing required of Lessee by the terms hereof or do any act
or thing that may be necessary and proper to be done in the observance of the covenants and
conditions hereof or to prevent the termination hereof. All payments so made, and all things
so done and performed by such holder, if done prior to the rights of Lessee having been
terminated, shall be as effective to prevent a termination of the rights of Lessee hereunder as
they would have been if done and performed by Lessee.
Upon such holder succeeding to the interest of Lessee hereunder, such holder shall be
bound by all terms and conditions of this Lease and Grant Agreement and shall be deemed to
have assumed all of Lessee’s obligations hereunder from and after such time as it succeeds to
the interest of Lessee.
17. EARLY TERMINATION OF THIS LEASE.
a. Sale. Notwithstanding Sections 23 and 36, in the event that (a) this Lease
is terminated prior to the end of the term or is not renewed pursuant to Section 4 of this
Lease, (b) the Premises are subject to the Grant Agreement and the Declaration, and
(c) the City determines by action of the City Council that the Premises are no longer
usable or needed to carry out the Governmental Program, then, the City may sell the
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City’s interest in the Premises, on the conditions that such sale is for fair market value
and if required by law, also upon terms authorized by law and approved by the
Commissioner of MMB in its reasonable discretion. For purposes of this Lease, “fair
market value” shall mean (i) the price that would be paid by a willing and qualified
buyer to a willing and qualified seller as determined by an appraisal which assumes that
any and all mortgage liens or encumbrances on the Premises, which negatively affect
the value of the Premises, will be released, or (ii) the price bid by a purchaser under a
public bid procedure after reasonable public notice with the proviso that any and all
mortgage liens or encumbrances on the Premises, which negatively affect the value of
the Premises, will be released at the time of acquisition by such purchaser. The City
shall not sell its interest in the Premises until it has first offered to sell its interest in the
Premises to Lessee, as hereinafter provided, and Lessee has elected in writing to not
purchase the City’s interest in the Premises.
The City hereby grants to Lessee a right of first option to purchase the City’s
interest in the Premises. Upon exercise of such purchase option, if the Grant Agreement
remains in effect, then (i) the City shall promptly pay such sums to the Commissioner
of MMB in full satisfaction of the Grant Agreement, and (ii) the Premises shall be
released from the Grant Agreement and the Declaration and shall no longer be
considered State Grant financed property.
In the event of a sale of the City’s interest in the Premises (a “Sale”) to a third
party, after deducting the City’s reasonable and customary costs incurred in such Sale,
the net proceeds of such Sale must be applied as follows: (v) first, to pay to the
Commissioner of MMB the amount of Grant proceeds actually disbursed and used to
better the Premises in accordance with the Grant Agreement, less any payments that
have been made pursuant to Section 2.08.B of the Grant Agreement; (w) second, to pay
in full any approved and outstanding public or private debt incurred to acquire or better
the City’s interest in the Premises; (x) third, to pay to Lessor the value of the City’s
interest in the Premises; (y) fourth, to pay to Lessee, and any other interested public or
private entities holding Priority Private Debt, other than such entity that has already
received the full amount of its contribution, the amount of money contributed initially
and subsequently by each to the acquisition or betterment of the Premises; and (z) fifth,
any excess over those amounts must be divided in proportion to the shares contributed
initially as set forth in Exhibit D and subsequently for acquisition and betterment of
the Premises, other than any public and private lenders already paid in full. Exhibit D
and subsection (y) in the preceding sentence shall be adjusted to include the amount of
contributions made by Lessee subsequently and to pay for capital improvements to the
Premises or the Improvements. Upon receipt of such sums, the Premises shall be
released from the Grant Agreement and the Declaration and shall no longer be
considered State Grant financed property. Nothing in this or any other agreement shall
be construed as requiring the City to sell its interest in the Premises.
To the extent, but only to the extent, disposition of the sale proceeds is not
controlled by the Grant Agreement , the proceeds of any sale will be shared by Lessee
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and the City in accordance with the percentages set forth on Exhibit E; provided that
all public and private indebtedness incurred to acquire or better the Premises shall first
be paid in full.
b. Payment of Investment. Notwithstanding Sections 23 and 36, in the
event that (a) this Lease is terminated prior to the end of the term or is not renewed
pursuant to Section 4 of this Lease, (b) the Premises are subject to the Grant Agreement
and the Declaration, and (c) the City has determined to continue to carry out the
Governmental Program in the Premises, then, at the time of the termination or renewal,
the City shall reimburse Lessee for its investment in the Premises (which investment is
the amount of money or like-kind contributions contributed initially and subsequently
to the acquisition and betterment of the Premises by Lessee). The sums to be paid by
the City to SHA for reimbursement of its investment shall be due and payable on the
termination or expiration date of this Lease, except those sums which cannot be
determined as of such date shall be due and payable upon determination and shall earn
interest from and after the date until paid in full at the rate of two percent (2%) over the
prime rate announced from time to time by U.S. Bank National Association. All
additional sums to be paid by the City to SHA shall be due and payable at the time of
the City’s election to purchase the interest of Lessee in the Premises and shall be
approved by the Commissioner of MMB. The parties agree that the projected amount
of investment by or on behalf of Lessee, as of the date of entry into this Lease, is agreed
to be as provided on Exhibit E.
c. Payment Based on Appraisal. Fair market value for the purposes of
Sections 17 and 18 of this Lease shall be established by the average of the following
three amounts: 1) appraisal prepared by an MAI or comparable certified appraiser
selected by the City, in its commercially reasonable discretion; 2) appraisal prepared
by an MAI or comparable certified appraiser selected by SHA, in its commercially
reasonable discretion; 3) the property tax value of the leased portion of the property as
of that date The cost of appraisals under this subsection will be paid by the entity
ordering the appraisal.
d. Sale Costs. In the event of a Sale described in subsection 17.a., Lessor
shall pay for the reasonable and customary costs incurred by the City in such Sale that
are not allowed by the State to be deducted first from the gross proceeds from such Sale
(by way of example to the extent not allowed by the State, the City’s costs for interim
property management, relocation, appraisal, marketing, staff administration, legal fees,
survey, and title work).
e. Intentionally omitted.
f. Survival. This Section 17 shall survive the termination of this Lease.
18. SUBLETTING AND ASSIGNMENTS. Except as provided herein, Lessee
shall not assign any of its rights hereunder, or sublet all or any portion of the Premises, without
Lessor’s prior written consent which consent may not be unreasonably delayed or withheld.
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Provided, an assignment to an operating non-profit 501(c)(3) entity, created by SHA whose
performance is guaranteed by SHA shall be a permitted assignment.
Further notwithstanding the foregoing, Lessee shall be permitted to mortgage its
interest hereunder to any mortgagee, provided such mortgage is in connection with Lessee’s
financing or refinancing of the development or improvement of the Premises as contemplated
herein subject to the requirements of Section 16 hereof. On the foreclosure of any such
mortgage, the mortgagee may thereafter assign or transfer its interest in the leasehold to any
other assignee or transferee, subject to the provisions of the Grant Agreement, provided that
any assignee thereof shall agree to be bound by the terms and conditions of this Lease.
Thereafter, there shall be no other assignments or transfers of the leasehold interest without
the prior written consent of Lessor, which consent may be given or withheld in Lessor’s sole
discretion, and Lessor’s consent to one assignment or transfer shall not be deemed to be a
consent to any subsequent assignment or transfer. Any other transfer or assignment without
Lessor’s consent shall be void and shall at the option of Lessor constitute a Default hereunder.
19. NOTICES. All communications, demands, notices, or objections permitted or
required to be given or served under this Lease shall be in writing and shall be deemed to have
been duly given or served when delivered in person to the other party or its authorized agent
or two (2) days after being deposited in the United States mail, postage prepaid, for mailing
by certified or registered mail, return receipt requested, and addressed to the other party to this
Lease, to the address set forth next to such party’s signature at the end of this Lease, or if to a
person not a party to this Lease, at the following addresses:
To Lessee:
With a Copy to the
Project:
To Lessor:
Scandia Heritage Alliance
P.O. Box 159
Scandia, MN 55073
Attention: Executive Director
Water Tower Barn Scandia Arts and Heritage Center
20835 Olinda Trail North
Scandia, MN 55073
City of Scandia
City Hall
14727 209th Street North
Scandia, MN 55073
Attention: City Administrator
Any party may change its address by giving notice in writing, stating its new address,
to any other party as provided in the foregoing manner. Commencing on the tenth (10th) day
after the giving of such notice, such newly designated address shall be such party’s address for
the purposes of all communications, demands, notices, or objections permitted or required to
be given or served under this Lease.
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20. CONSTRUCTION OF IMPROVEMENTS. Lessee shall construct the
Improvements, described on Exhibit B (the “Improvements”), attached hereto and
incorporated herein, at its own expense and subject to and in accordance with all terms and
conditions of this Lease, the Grant Agreement, the Construction Disbursing Agreement
between Lessor, Lessee, the title insurer, and other parties dated as of the date hereof (the
“Disbursing Agreement”) and in material compliance with all applicable federal, state and
local laws, rules and regulations, and in material compliance with the terms and conditions of
all applicable licenses and permits. Lessor agrees it shall authorize the disbursal of the State
Grant Proceeds to Lessee to be used to construct the Improvements as provided herein and in
accordance with the Grant Agreement and the Disbursing Agreement. The Improvements shall
be substantially completed not later than the Construction Completion Date, subject to delays
in the performance obligations for construction of the Improvements due to the unforeseeable
causes beyond the control of Lessee and without the fault or negligence of Lessee, including
but not limited to adverse or severe weather conditions, acts of God, acts of the public enemy,
strikes, lock-outs, or other similar labor troubles, fire, floods, epidemics, quarantines,
unavailability of power, unavailability of materials, delays due to damage or destruction of the
Premises or the equipment used to construct the same, discovery of hazardous materials or
other concealed site conditions including environmental issues, or delays of contractors due to
such discovery, and litigation commenced by third parties which by injunction or other similar
judicial action directly results in delays and other casualty to the Premises, or affect the validity
of this Lease (“Unavoidable Delays”). Lessor and Lessee acknowledge that during such
construction, the Governmental Program will not commence or may be interrupted as is
reasonably necessary for orderly and safe construction to occur, provided that the
Governmental Program shall commence or resume within a reasonable time after the
Completion Date, subject to Unavoidable Delays. Upon the termination or expiration of this
Lease, all of the Improvements, including any fixtures related to the operation of any
Improvements located on the Premises, shall immediately become the property of the Lessor.
Upon request of the Lessor after termination of this Lease, Lessee will execute and deliver to
the Lessor bills of sale transferring to the Lessor title to any personal property that has become
a fixture and property of the Lessor under the preceding sentence. Lessee is hereby authorized
by Lessor to provide for the construction and equipping of the Improvements in accordance
with the Grant Agreement and the Grant Legislation.
21. CONSTRUCTION OF ADDITIONAL BUILDINGS AND
IMPROVEMENTS. Lessee shall, with the prior written approval of Lessor which approval
shall not be unreasonably delayed or withheld, have the right to make such alterations,
improvements, and changes (other than the initial Improvements, which have been previously
approved by Lessor) to any building or Improvement which may from time to time be on the
Premises, as Lessee may deem necessary, subject to the limitations in Section 13.
Notwithstanding the preceding sentence, Lessor agrees that changes to the Improvements or
the Project do not require the consent of Lessor if (i) Lessee in its reasonable judgment
determines such changes do not reduce the value of the Project as a whole or reduce the ability
of Lessee to operate the Governmental Program, (ii) each such change costs less than
$100,000, and (iii) before commencing the change, Lessee provides Lessor notice and receives
all necessary permits for the change. Lessor and Lessee acknowledge that during such
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additional construction, the Governmental Program may be interrupted as is reasonably
necessary for orderly and safe construction to occur, provided that the Governmental Program
shall resume within sixty (60) days after completion of construction. Any new building
constructed by Lessee on the Premises, and any changes to the existing Improvements or
subsequently to new buildings, shall be constructed in material compliance with all applicable
federal, state and local laws, rules and regulations; and in compliance with the terms and
conditions of all applicable licenses and permits; and, together with any fixtures related to the
operation of any buildings located on the Premises, shall, upon termination or expiration of
this Lease, become the property of Lessor. Upon request of Lessor after the termination or
expiration of this Lease, Lessee will execute and deliver to Lessor bills of sale transferring to
the Lessor title to personal property which has become a fixture and consequently property of
the Lessor under the preceding sentence.
23. REPAIRS AND DESTRUCTION OF IMPROVEMENTS.
a. Maintenance of Improvements. Lessee shall, throughout the term of this
Lease, at its own cost and without any expense to Lessor, keep and maintain the
Premises and the Improvements, of every kind which may be a part thereof, and all
appurtenances thereto, including public and private sidewalks located thereon and
adjacent thereto, in good, sanitary, lawful, and neat order, condition, and repair and,
except as specifically provided herein, shall restore and rehabilitate any Improvements
which may be destroyed or damaged by fire, casualty, or any other cause whatsoever.
Lessor shall not be obligated to make any repairs, replacements, or renewals of any
kind, nature, or description whatsoever to the Premises or any buildings or
improvements thereon.
b. Damage to and Destruction of Buildings or Improvements. The damage
or destruction or partial destruction of any building or other Improvement which is a
part of the Premises shall not release Lessee from any obligation hereunder, except as
hereinafter expressly provided.
In case of damage to or destruction of such building or Improvement which is
not substantial, Lessee shall at its own expense promptly repair and restore the same to
a condition as good or better than that which existed prior to such damage or
destruction, and Lessee shall have the right to any insurance proceeds the premium for
which has been paid by Lessee to be used by Lessee to pay the cost of such repair and
restoration.
In the case of damage to or destruction of such building or Improvement which
is substantial, Lessee shall at its own expense promptly repair and restore the same to
a condition as good or better than that which existed prior to such change or destruction,
unless Lessee, in its judgment, determines that it is inappropriate to rebuild the building
or Improvements on the Premises, in which case this Lease and Lessee’s interest in the
Premises shall be terminated and shall have the same effect as if a Sale shall have
occurred (subject to Lessor’s determination that the Premises are no longer usable or
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needed by Lessor to carry out the Governmental Program), and the insurance proceeds
shall be paid in accordance with the provisions of Section 17 above; provided, however,
if Lessee pays to Lessor the sums required by Section 2.08.C. of the Grant Agreement
or such lesser amount permitted under Minnesota law, in full satisfaction of the Grant
Agreement, then the insurance proceeds shall be paid to Lessee. Lessee shall give
written notice to Lessor of its determination whether or not to rebuild within one
hundred and eighty (180) days of the damage or destruction of the buildings or
Improvements. If Lessee does not elect to rebuild, this Lease shall terminate as of the
date specified in Lessee’s notice to Lessor, and all rent and other obligations of Lessee
shall terminate on that date. No settlement with the insurance company shall be agreed
to by Lessee without the prior written consent of Lessor and the State.
Except as otherwise provided in this Section, and without limiting such
obligations of Lessee, if Lessee elects to rebuild, and any mortgagee consents to
rebuilding, if necessary, it is agreed that the proceeds of any insurance covering such
damage or destruction shall be paid to Lessor and Lessee, to be held in escrow for such
repair or replacement with an escrow agent acceptable to Lessor, Lessee, and any
mortgagee, to be disbursed in accordance with standard commercial construction
lending conditions customarily required by institutional lenders. The Lessee shall not
be obligated to operate the Governmental Program on the Premises from the date of
damage or destruction of the buildings or Improvements until repair or reconstruction
of the buildings or improvements on the Premises is complete.
24. MECHANICS’ LIENS. Lessee hereby covenants and agrees that Lessee will
not permit or allow any mechanics or materialmen’s liens to be placed on Lessor’s interest in
the Premises during the term hereof. Notwithstanding the previous sentence, however, in the
event any such lien shall be so filed against Lessor’s interest, Lessee shall take all steps
necessary to remove it within 120 days of its being filed; and provided further, however, that
Lessee may contest any such lien provided Lessee first provides a surety bond, title insurance,
or letter of credit or cash with the applicable court sufficient to release the Premises from such
lien, or otherwise protect Lessor from foreclosure thereof.
25. INDEMNIFICATION OF LESSOR.
a. To the fullest extent permitted by law, Lessee shall, and hereby does,
indemnify, save, hold harmless, and defend Lessor, its officials, employees,
representatives, and agents but only when acting in their capacities as such
(collectively, the “Indemnified Party” or “Indemnified Parties”), from and against
all claims, costs (including reasonable attorney’s fees to the extent provided in clause
e. below), liabilities, losses, or damages suffered or incurred by any of the Indemnified
Parties arising from or as a result of any loss, injury, death, or damage to persons or
property arising out of the use, possession, construction of Improvements, operation,
or maintenance of the Premises or any part thereof, or as a result of Lessee’s failure to
comply with the Grant Agreement, except when such loss, injury, death, or damage
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shall be caused by or in any way result from or arise out of any act, omission, or
negligence of the Indemnified Parties as provided in subsection c. hereof.
b. Lessee hereby waives and releases all claims against the Indemnified
Parties for damages to any building and Improvements which are now on or hereafter
placed or built on the Premises and to the property of Lessee in, on, or about the
Premises. Lessee also agrees that it will not assert against the Indemnified Parties in
any legal proceeding any claim, cross-claim or third party claim for which Lessee is
obligated under the provisions of clause a. of this Section 25 to provide indemnification
to the Indemnified Parties.
c. (1) No person or entity other than the Indemnified Parties shall have any
benefit whatsoever from the agreements contained in this Section, other than any
incidental indirect benefit accruing to taxpayers or residents of the City by reason of
the benefit to Lessor and the Indemnified Parties and shall not in any case be deemed
to be a third party beneficiary of the agreements of Lessee contained in clauses a. and
b. above. (2) Notwithstanding the provisions of clauses a. and b. above, the provisions
of clause a. and b. shall not apply to claims, costs, liabilities, losses, or damages which
are caused by the willful or intentional misconduct or gross negligence of the
Indemnified Parties, and in such case the Indemnified Parties shall owe the same
indemnity and other obligations to the Lessee as provided in clauses a. and b.
d. Nothing in this Section 25 shall be construed to, and shall not, expand
Lessor’s maximum liability over the limits set forth in Minnesota Statutes, Chapter 466,
as amended from time to time, or any other or successor law which has the effect of
limiting Lessor’s liability.
e. Promptly after receipt by an Indemnified Party of notice of the
commencement of any action for which Lessee has indemnified the Indemnified Parties
hereunder, the Indemnified Party will notify Lessee in writing of the commencement
thereof, and, subject to the provisions hereinafter stated, Lessee shall assume, at its
expense, the defense of such action (including the employment of counsel, who shall
be reasonably satisfactory to the Indemnified Parties) insofar as such action shall relate
to any alleged liability for which Lessee has indemnified the Indemnified Parties
hereunder. The Indemnified Parties shall have the right to employ separate counsel in
any such action and to participate in the defense thereof, but the fees and expenses of
such counsel shall not be at the expense of Lessee unless (i) the employment of such
counsel has been specifically authorized by Lessee, or (ii) the named parties to any such
action (including any impleaded parties) include more than one of the Indemnified
Parties and a conflict of interest among Lessee and Indemnified Parties exists, and as a
result Lessee and the Indemnified Parties cannot adequately be represented by the same
counsel. In the case of such a conflict of interest, Lessee shall not have the right to
assume the defense of such action on behalf of such Indemnified Parties and the
Indemnified Party shall have the right to select separate counsel, at the expense of
Lessee but subject to the limitation set forth in the following sentence, to assume such
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legal defense and to otherwise participate in the defense of such action on behalf of the
Indemnified Parties. Subject to the rules of professional responsibility and conflicts of
interest, in connection with any one such action or separate but substantially arising out
of the same general allegations or circumstances, Lessee shall not be liable for the fees
and expenses of more than one separate firm of attorneys for all such Indemnified
Parties, which firm shall be reasonably acceptable to Lessee and shall be designated in
writing by the Indemnified Parties. Lessee shall not be liable for any settlement of any
such action effected without its written consent. If such action is settled with the written
consent of Lessee, or if there be a final judgment for the plaintiff in any such action,
with or without the consent of Lessee, Lessee agrees to indemnify and hold harmless
the Indemnified Parties from and against any loss or liability by reason of such
settlement or judgment, but only to the extent provided in subsection a. of this
Section 25. This indemnity includes reimbursement for expenses reasonably incurred
by any of the Indemnified Parties in investigating the claim and in defending it if Lessee
declines to assume the defense.
26. INSURANCE.
a. Insurance Coverage of Premises. Lessee shall at all times during the
terms of this Lease and at Lessee’s sole expense keep all improvements which are now
or hereafter a part of the Premises insured against “all risks”, for those risks that are
available at commercially reasonable rates, for the full insurable value of such
improvements, and during the construction of the Improvements “builders risk” and
standard fire and extended coverage, with a deductible not to exceed $25,000.00, and
with loss payable to Lessor, Lessee, the State, and any mortgagee as their respective
interests may appear. Any loss adjustment shall be made in accordance with the
requirements for the use and distribution of insurance proceeds in the event of damage
as otherwise provided herein, but shall require the prior written consent of Lessor, the
State, Lessee, and any mortgagee. Lessee shall be responsible for any insurance
deductible.
b. Commercial General Liability Insurance. Lessee shall maintain in effect
throughout the term of this Lease, at its own expense, commercial general liability
insurance covering the Premises and its appurtenances and the sidewalks fronting on
the Premises in the amount of at least Two Million Dollars ($2,000,000) combined
single limit, and insurance on all boilers and other pressure vessels, fired or unfired, or
the tort liability minimums set forth under Minnesota law, whichever is greater. Such
insurance shall: (i) be primary with respect to Lessor’s insurance or self-insurance; (ii)
not exclude explosion, collapse and underground property damage; (iii) be written on
an “Occurrence” Form policy basis; (iv) shall name Lessor, the State, and any
mortgagee as additional insureds thereunder; and (v) not contain an “aggregate” policy
limit (combined general liability and excess liability) of less than Ten Million Dollars
per annual policy period unless specifically approved in writing by Lessor.
Additionally, Lessor, the State, and any mortgagee shall be named as additional
insureds on any contractor’s general liability insurance maintained by the general
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contractor or construction manager responsible for constructing the improvements to
the Premises.
c. Workers’ Compensation Insurance. Lessee shall maintain Workers’
Compensation Insurance with not less than statutory minimum limits, and Employers’
Liability Insurance with minimum limits of at least One Hundred Thousand Dollars
($100,000) per accident and with an all states endorsement.
d. Insurance Certificates. Lessee shall supply to Lessor, concurrently with
signing this Lease and thereafter as reasonably requested by Lessor, current insurance
certificates for policies required in this Section. Lessee shall promptly furnish to Lessor
all endorsements and other written notices which modify or change any insurance
coverage with respect to the Premises or Lessee’s operation at the Premises, and all
paid premium receipts by Lessee regarding such required insurance.
e. Additional Required Insurance. The limits cited under each insurance
requirement above established minimums; and it is the sole responsibility of Lessee to
purchase and maintain additional insurance that Lessee may determine to be necessary
in relation to this Lease or its operation of the Premises.
f. Non-waiver of Statutory Limits. Nothing in this contract shall constitute
a waiver by Lessor of any statutory limits or exceptions on liability.
g. Placement of Insurance. Lessee shall place the insurance with
responsible insurance companies authorized and licensed to do business in the State of
Minnesota having an A.M. Best Company rating of at least A:VIII, and shall deliver
certificates in the form required above evidencing such coverage to Lessor on the date
of Lessee’s execution of this agreement and from time to time thereafter as reasonably
required by Lessor. The policies required in this Section shall be endorsed to indicate
that the insurer cannot cancel or change the insurance without first giving Lessor and
the State thirty (30) days’ written notice.
h. Lessor’s Right to Pay Premiums on Behalf of Lessee. Lessee shall pay
all of the premiums therefor and deliver such policies, or certificates thereof, to Lessor.
In the event of the failure of Lessee, either to effect such insurance in the names called
for or to pay the premiums therefor or to deliver such policies or certificates thereof to
Lessor, Lessor shall be entitled, but shall have no obligation, to effect such insurance
and pay the premiums therefor. Such premiums, together with interest thereon at the
rate of ten percent per annum accruing from the date of payment by Lessor, shall be
repayable to Lessor within thirty (30) days after written notice of the payment of such
insurance, and failure to repay the premiums shall carry with it the same consequences
as failure to pay any installment of Rent. All rebates on account of any such premiums
paid by Lessor shall belong to Lessor, provided Lessee has not reimbursed Lessor for
such premiums and Lessee shall have no obligation to reimburse Lessor to the extent
of such rebates received and retained by Lessor.
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Each insurer mentioned in this Section shall agree, by endorsement on the policy
or policies issued by it, or by independent instrument furnished to Lessor, and in form
acceptable to Lessor, that it will give to Lessor and the State thirty (30) days’ written
notice before the policy or policies in question shall be altered or cancelled.
i. Increase in Coverage. The insurance and the size of any applicable
deductible required to be maintained pursuant to this Lease shall be subject to review
as to its adequacy by Lessee and Lessor once every five (5) years beginning in the year
2030.
j. Blanket Insurance Policies. Notwithstanding anything to the contrary
contained in this Section, Lessee’s obligations to carry the insurance provided for
herein may be brought within the coverage of a so-called blanket policy or policies of
insurance carried and maintained by Lessee; provided, however, that the coverage
afforded Lessor will not be reduced or diminished or otherwise be different from that
which would exist under a separate policy meeting all other requirements of this Lease
by reason of the use of such blanket policy of insurance.
27. PROHIBITION OF INVOLUNTARY ASSIGNMENT.
Neither this Lease nor the leasehold estate of Lessee nor any interest of Lessee
hereunder in the Premises or in any buildings or improvements thereon shall be subject to
involuntary assignment, transfer, or sale, by operation of law or otherwise, and any such
attempt at involuntary assignment, transfer, or sale shall be void and of no effect. For purposes
of this subsection, the merger or consolidation of Lessee with any other entity or entities shall
be deemed to be a transfer and prohibited by this subsection unless either: (i) such merger is
with another entity and Lessee is the survivor and remains exempt from income tax under
§ 501(c)(3) of the Internal Revenue Code of 1986 as amended (the “Code”); or (ii) such
merger is with another entity which is exempt from income tax under § 501(c)(3) of the Code,
Lessee is not the surviving entity, said surviving entity expressly assumes all obligations of
Lessee hereunder, said surviving entity remains exempt from income tax under § 501(c)(3) of
the Code, and said surviving entity has comparable or higher “net worth” (or its equivalent
under accounting principles applicable to Section 501(1)(3) organizations) as Lessee has on
the date hereof.
The occurrence of any involuntary assignment prohibited by the provisions of this
Section 27 shall be deemed to constitute a under Section 28 hereof, and upon the expiration of
the applicable cure period contained in Section 29 hereof, Lessor shall be entitled to exercise
all remedies set forth in this Lease, subject, however, to the provisions of Section 32 hereof.
28. EVENTS OF LESSEE DEFAULT. Any of the following events shall constitute
a “Default” by Lessee under this Lease:
a. Subject to Unavoidable Delays, if construction of the Improvements has
not been commenced or completed by the dates required by Section 21 and have not
been completed substantially in accordance with the plans and specifications as
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amended from time-to-time in accordance with the provisions contained in Section 21
and the Grant Agreement;
b. Subject to any payments being contested in good faith, if Lessee fails to
fully and completely pay all sums lawfully owing for the completion of the
Improvements in accordance with the plans and specifications, or under this
Agreement, respecting the Premises or the Improvements or their respective operations,
repair, maintenance, or replacement;
c. If, without the written consent of Lessor, any part of the Premises ceases
to be used to achieve the Governmental Program;
d. If a Default under Section 27 hereof occurs;
e. If, without the written consent of Lessor and the Commissioner of MMB,
and except for any permitted encumbrances identified Exhibit F attached hereto, and
except as allowed under Sections 16, 17, 18 or 19 hereof, Lessee sells, transfers, leases,
encumbers, or otherwise conveys, in any way or manner, whether voluntary or
involuntary, or by action of law, all or any part of its interest in the Premises, or amends
or modifies any agreement relating to such sale which had previously been so consented
to and approved by Lessor and the Commissioner of MMB;
f. If, without the written waiver of Lessor, Lessee fails to annually certify
that the Premises is being used to achieve the Governmental Program as required in
Section 1 of this Lease;
g. If, without the written waiver of Lessor, Lessee fails to provide the
annual information to Lessor for Lessor’s reporting to the State;
h. If Lessee fails to continuously maintain the insurance required by
Section 26 of this Lease;
i. If Lessee, upon request, refuses to allow Lessor, the representative of
DEED, or any auditor for the State or for the Minnesota Legislature, to inspect audit,
copy, or abstract any and all of Lessee’s financial records (books, records, papers) or
other documents relevant to this Lease or the Grant to Lessor, or the Premises;
j. If Lessee, upon request, refuses to allow Lessor or any authorized
representative of the State, to inspect the Premises;
k. If Lessee fails to cooperate fully with Lessor in complying with any of
the provisions of the Grant Agreement or any applicable MMB or DEED requirements,
or Lessee fails to comply with the Grant Agreement or MMB or DEED orders;
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l. If any material representation or warranty made by Lessee hereunder
proves to have been untrue or incorrect in any significant respect, as of the time such
representation or warranty was made;
m. If, without the written consent or waiver of Lessor, Lessee fails to fully
comply with any other provision, term, condition, covenant, or warranty contained in
this Lease, or fails to fully comply with any provisions of the Declaration;
n. If, under any material document, instrument or agreement relating to the
acquisition, construction, financing, or refinancing, of the improvements to the
Premises, there occurs an event which constitutes a Default by Lessee thereunder,
applicable grace and cure periods have passed without cure, and the other party thereto
gives notice to Lessee of the Default if notice is required before the exercise of
remedies; or
o. If Lessee breaches this Agreement and, if applicable, the breach remains
uncured after Notice of Default per section 29.
29. NOTICE OF DEFAULT.
a. Upon the occurrence of a Default, such Default shall not be deemed to
have occurred under this Lease unless Lessor has given Lessee written notice of the
Default and Lessee has failed to cure such Default within the time period specified in
subsection b. or c., as applicable, below.
b. For those Defaults described in Section 27 and subsections 28 (i) and (j)
the notice and cure period shall be ten (10) days; for those Defaults described in
subsection 28 h. the notice and cure period shall be thirty (30) days (provided said
insurance does not expire); and for all other Defaults the notice and cure period shall
be sixty (60) days prior to the Completion Date and ninety (90) days after the
Completion Date.
c. Notwithstanding the preceding paragraph of this Section 29, (i) in the
event that a Default occurs prior to the Completion Date and cannot be cured within the
applicable cure period provided in subsection b. above, and in the event that Lessee has
commenced the action necessary to cure the Default during the applicable cure period
provided in the subsection b. above, then Lessee shall have such time as shall be
reasonably necessary to cure such Default on the condition that Lessee is reasonably,
continuously and diligently pursuing efforts to cure such Default; (ii) in the event that
a Default occurs after the issuance of the Completion Date and cannot be cured within
the applicable cure period provided in subsection b. above, and in the event that Lessee
has commenced the action necessary to cure the Default during the applicable cure
period provided in subsection b. above, then Lessee shall have such time as shall be
reasonably necessary to cure such Default so long as Lessee is reasonably, continuously
and diligently pursuing efforts to cure such Default; and (iii) provided, further, in no
event shall any cure period, including any extension of a cure period, be greater than
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the cure period available under the Grant Agreement if the Default by Lessee hereunder
also causes a Default by Lessor under the Grant Agreement.
Additionally, no extensions of the cure period set forth in subsection b. above shall be
granted or allowed for a Default under Section 27 hereof.
30. Intentionally omitted.
31. ADDITIONAL REMEDIES.
a. In addition to other remedies available to either party as a matter of law
for a Default, if the Grant has not been fully disbursed, and after giving the notice
required by Section 29, Lessee does not immediately commence and continuously
pursue the cure of same, Lessor may refrain from making any payments to the Lessee
from the Grant Agreement.
b. In addition, during the continuance of a Default under this Lease, and
after giving Lessee any notice required by Section 29 hereof and the running of any
applicable time period without Lessee having cured, Lessor may, if the State issues a
demand, commences an action, actually receives payment from Lessor, or exercises
any other remedies against Lessor, then Lessor may also similarly demand,
commence an action, or exercise any other remedies against, and be immediately
entitled to receive from Lessee, or do to Lessee that which the State does to Lessor on
the condition that such demand, action, payment, or other action by the State against
Lessor is caused by a Default by Lessee under this Lease.
c. In addition, Lessor’s damages, expenses (including internal), and
attorneys fees and costs.
32. SPECIAL TERMINATION PROCEDURE. After the Completion Date for the
Improvements, if Lessee is in Default under subsection 28.c, Lessor agrees that it will not
exercise the remedy of termination of the Lease provided in Section 30 hereof on the condition
that Lessee does each of the following:
a. Within ninety (90) days of the occurrence of a Default, Lessee shall have
retained, at its sole expense, an independent consultant qualified to analyze Lessee’s
operation at the Premises and reasonably acceptable to Lessor, (hereinafter the
“Consultant”);
b. Within sixty (60) days of the retention of the Consultant, Lessee shall
have delivered to Lessor a written report of the Consultant analyzing its operations at
the Leased Premises (the “Consultant’s Report”); and
c. Within fifteen (15) days of the delivery of the Consultant’s Report,
Lessee shall have met with Lessor to discuss the findings and recommendations of the
Consultant; provided, however, that in the event that Lessee has not retained the
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Consultant, delivered the Consultant’s Report, or met with Lessor, within the required
time period, then Lessor shall have the right to proceed to exercise the remedy of
termination of this Lease without regard to the succeeding provisions of this Section 32.
Lessor and Lessee acknowledge and agree that Lessee shall not be required to pay more
than $25,000 (adjusted for inflation) for the fees and expenses of each Consultant’s
Report. Lessor agrees that if after any time during the process set forth in
subsections a., b. or c. above, the Default has been cured, Lessee shall not be required
to proceed with the remaining portion of the process set forth in such subsections.
In the event that Lessee has retained the Consultant, delivered the Consultant’s
Report, and met with Lessor as required hereinabove, Lessor further agrees that it will
not exercise the remedy of termination of this Lease unless and until (i) the governing
body of Lessor has considered a resolution at which meeting representatives of Lessee
shall have the right to be heard; (ii) Lessor’s governing body shall adopt a resolution
authorizing the termination of this Lease, and (iii) Lessee shall have failed to cure the
Default within thirty (30) days of the adoption of such resolution.
Lessee acknowledges and agrees that: a) Lessor is not required to accept or
adopt all or any portion of the Consultant’s Report; and b) in the event that Lessor
determines, in its sole discretion, to accept any of the recommendations of the
Consultant’s Report, the acceptance of which requires an amendment to this Lease, or
a waiver of the Default, Lessor shall have the right, as a condition to agreeing to any
such amendment or waiver, to impose any conditions Lessor deems appropriate, in its
reasonable discretion.
33. LESSOR’S RIGHT TO PERFORM. In addition to any other provision
contained herein, in the event that a Default by Lessee shall have occurred and be continuing,
Lessor may, at Lessor’s option but without any obligation, take any action to perform the
obligations of Lessee which gave rise to the Default or with respect to which Lessee is
otherwise in Default under this Lease, and Lessor shall not be liable, or be held liable or in any
way responsible for any loss, inconvenience, annoyance, or damage resulting to Lessee on
account thereof, other than for Lessor’s willful or intentional misconduct. Lessee shall repay
to Lessor on demand the entire expense of Lessor’s performance together with interest at the
rate of ten percent per annum accruing from the date of any disbursement.
Lessor shall be permitted to enter the Premises while exercising any right given to it by
the terms of this Section. Any act or thing done by Lessor pursuant to the provisions of this
Section shall not be or be construed to be a waiver of any such Default by Lessee, or as a
waiver of any covenant, term, or condition herein contained or the performance thereof, or of
any other right or remedy of Lessor, hereunder or otherwise.
34. LESSOR DEFAULTS AND TENANT’S LIMITED REMEDIES. In the event
that (i) Lessor (a) fails to observe, perform or comply with any provision, term, condition,
covenant, agreement or warranty required to be observed, performed or complied with by
Lessor under this Lease, or (b) fails to observe, perform or comply with any obligation,
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provision, term, covenant, condition or agreement to be observed, performed or complied with
by Lessor under the Grant Agreement, unless Lessor’s failure is the result of a Default by
Lessee under this Lease, and (ii) Lessor fails to cure such Default within ten (10) days of
written notice of default from Lessee, or fails to commence and diligently pursue reasonable
steps to commence and effect a cure if a cure cannot be completed within such ten-day period,
then a Lessor Default shall exist under this Lease. Upon the occurrence and during the
continuance of a Lessor Default, Lessee may exercise either or both of the following remedies:
a. subject to Sections 65 and 67 hereof, commence an action at law to
recover the damages incurred by Lessee and caused by Lessor’s Default, which
damages shall be limited to the cost of curing Lessor’s Default;
b. commence an action in equity to compel the performance by Lessor of
those actions or inactions which serve as the basis of a Lessor Default.
35. NO REMEDY EXCLUSIVE. Subject to Section 65 below, no remedy herein
conferred upon or reserved to Lessor 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 Lease or now or hereafter existing at law or in equity or
by statute. No delay or omission to exercise any right or power accruing upon any Default
shall impair any such right or power or shall be construed to be a waiver thereof, but any such
right and power may be exercised from time to time and as often as may be deemed expedient.
36. EFFECT OF EMINENT DOMAIN.
a. Effect of Total Condemnation. In the event that the entire Premises shall
be appropriated or taken under the power of eminent domain by any public or
quasi-public authority, this Lease shall be terminated and all proceeds shall be payable
in the same manner as if the Premises were sold pursuant to Section 17 above; provided,
however, if Lessee pays to Lessor the sums required by Section 2.08.C. of the Grant
Agreement or such lesser amount permitted under Minnesota law, then the proceeds
shall be paid to Lessee.
b. Effect of Partial Condemnation. In the event that a portion of the
Premises shall be so appropriated or taken to an extent that Lessee can no longer operate
the Governmental Program, then Lessee shall have the right to give Lessor written
notice of the right to treat the partial condemnation as a sale pursuant to Section 17
above within one hundred twenty (120) days after such portion of the Premises has
been so appropriated or taken. In that event, this Lease shall be terminated and the
proceeds of the condemnation shall be applied as if the condemned portion of the
Premises were sold in accordance with Section 17 above; provided, however, if Lessee
pays to Lessor the sums required by Section 2.08.C. of the Grant Agreement or such
lesser amount permitted under Minnesota law, then the proceeds shall be paid to Lessee.
In the event of partial taking in which Lessee elects to continue this Lease in the
Premises, this Lease shall continue in full force as to the part not taken, and the
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condemnation award for the Premises shall be applied first to restore the remaining
portion of the Premises to a configuration and condition so that the Premises can be
used for the purposes set forth in Section 1 hereof (with the condemnation proceeds to
be held by a mutually agreeable escrow agent in escrow for such restoration to be
disbursed in accordance with standard commercial construction conditions customarily
required by institutional lenders), and, to the extent of any remaining proceeds, as if the
condemned portion of the Premises were sold in accordance with Section 17 above;
None of the foregoing provisions shall preclude Lessee from making a separate
claim against the condemning authority for the value of any trade fixtures, furniture,
and equipment taken, loss of value of the leasehold interest, loss of value of the
business, or other claims compensable in condemnation of a Lessee’s interest, by said
condemning authority and its relocation expenses, provided such claim does not
diminish or impair the award with respect to the Premises.
37. SURRENDER OF LEASE: EFFECT ON SUBLEASES. The voluntary or
other surrender of this Lease by Lessee, or a mutual cancellation thereof, shall not work a
merger and shall operate as an assignment to it of any or all such subleases, subtenancies, or
license agreements. Lessee shall surrender the Premises in good condition, broom clean, and
provide any and all keys and codes for access and use of the Premises and fully cooperate in
the assignment and transfer of the Premises to Lessor.
38. Intentionally omitted.
39. AMENDMENT, MODIFICATION, AND WAIVER. No amendment,
modification, or waiver of any condition, provision, or term of this Lease shall be valid or of
any effect unless made in writing, signed by the party or parties to be bound or its duly
authorized representative, and approved in writing by the State, and specifying with
particularity the extent and nature of such amendment, modification, or waiver. Any waiver
by any party of any Default of another party shall not affect or impair any right arising from
any subsequent Default.
40. APPROVAL BY STATE OF MINNESOTA. This Lease shall not be valid or
of any effect until signed by both parties and consent in writing has been given by the State.
41. EFFECT OF LESSEE’S HOLDING OVER. Any holding over after the
expiration of the term of this Lease, with consent of Lessor, shall be construed to be a tenancy
from month to month, at the same Rent as required to be paid by Lessee for the period
immediately prior to the expiration of the terms hereof, and shall otherwise be on the terms
and conditions herein specified, so far as they are applicable.
42. PARTIES BOUND. This Lease shall be binding upon and inure to the benefit
of the parties hereto and their respective assigns, executors, heirs, and successors.
43. TIME OF ESSENCE. Time is of the essence in this Lease, and of each and
every covenant, term, condition, and provision hereof.
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44. CAPTIONS. All captions, headings, or titles in the subsections or Sections of
this Lease are inserted for convenience of reference only and shall not constitute a part of this
Lease as a limitation of the scope of the particular subsections or Sections to which they apply.
45. NO PARTNERSHIP, JOINT VENTURE, OR FIDUCIARY RELATIONSHIP
CREATED HEREBY. Nothing contained in this Lease shall be interpreted as creating a
partnership, joint venture, or relationship of principal and agent between Lessor and Lessee, it
being understood that the sole relationship created hereby is one of landlord and tenant. All
laws and statutes of the State relative to landlord and tenant relationships shall be applicable
to the parties hereto.
46. CUMULATIVE RIGHTS. Except as otherwise expressly stated herein, no right
or remedy herein conferred on or reserved to Lessee or Lessor is intended to be exclusive of
any other right or remedy hereof provided by law, but each shall be cumulative in, and in
addition to, every other right or remedy given herein or not or hereafter existing at law, in
equity, or by statute.
47. SEVERABLE PROVISIONS. Each provision, section, sentence, clause,
phrase, and word of this Lease is intended to be severable. If any provision, sentence, clause,
phrase, and word hereof is illegal or invalid for any reason whatsoever, such illegality or
invalidity shall not affect the legality or validity of the remainder of the Lease.
48. ENTIRE AGREEMENT. This Lease contains the entire understanding of the
parties hereto with respect to the transactions contemplated hereby and supersede all prior
agreements and understandings between the parties with respect to such subject matter. No
representations, warranties, undertakings, or promises, whether oral, implied, written, or
otherwise, have been made by either party hereto to the other unless expressly stated in this
Lease or unless mutually agreed to in writing between the parties hereto after the date hereof,
and neither party has relied on any verbal representations, agreements, or understandings not
expressly set forth herein.
49. REFERENCE TO GENDER. Where appropriate, the feminine gender may be
read as the masculine gender or the neuter gender; the masculine gender may be read as the
feminine gender or the neuter gender; and the neuter gender may be read as the masculine or
the feminine gender.
50. MINNESOTA LAW, JURISDICTION AND VENUE. This Agreement shall
be construed and enforced in accordance with the laws of the State of Minnesota. Any claim,
dispute or litigation arising out of this Agreement shall be venued exclusively in Washington
County District Court, Tenth Judicial District, State of Minnesota and shall not be removed
therefrom to any other federal or state court.
51. FURTHER ASSURANCES. In addition to any other information which may
reasonably requested, either party shall without charge at any time and from time to time
hereafter, within ten (10) days after written request by the other party, certify by written
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instrument duly executed and acknowledged to any person, firm, or corporation specified in
such request:
a. Whether this Lease has been supplemented or amended, and if so, the
substance and manner of such supplement or amendment;
b. The validity and force and effect of this Lease, in accordance with its
tenor as then constituted;
c. The existence of any Default known thereunder;
d. The existence of any offsets, counterclaims, or defenses thereto known
by such other party; and
e. The commencement and expiration dates of the term of this Lease.
Any such certificate may be relied on by the party who requested it and any other
person, firm, or corporation to whom it may be exhibited or delivered, and the contents of such
certificate shall be binding on the party executing it.
52. SHORT-FORM RECORDABLE LEASE. The parties will at any time, at the
request of either one, promptly execute duplicate originals of an instrument, in recordable
form, which will constitute a short form of this Lease, setting forth a description of the
Premises, the Term of this Lease, and options to renew, and any other portions hereof,
excepting the rent provisions, as either party may request.
53. FEDERAL INCOME TAX DEDUCTIONS. Only Lessee shall have the right
to take deductions on its tax returns with respect to the Improvements, and any changes,
alterations, repairs, additions, and installations thereto, and the depreciation or amortization
thereof; provided, however, that Lessor makes no representations or warranties as to the
amount of any taxes or deductions or the treatment of any particular tax item.
54. BROKERAGE FEES. Each party hereto warrants that it has not incurred any
real estate brokerage fees, finders’ fees, loan brokerage fees, or any other fees to any third
party in connection with this Lease, and in the event that any third party institutes legal action
in an effort to recover such fees, the parties shall jointly defend such action. If a judgment is
obtained against the parties jointly, the party responsible for breach of this warranty shall
reimburse the other for the latter’s attorneys’ fees, court costs, expenses, and share of the
judgment.
55. Intentionally Omitted.
56. LISTING OF JOBS. Lessee shall, during the term of the Grant Agreement, list
any vacant or new positions it may have with state workforce centers, as required by Minn.
Stat. § 116L.66 as such may subsequently be amended, modified or replaced.
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57. RECORD KEEPING AND REPORTING. Lessee shall maintain books,
records, documents, and other evidence pertaining to the costs or expenses associated with the
construction of the Improvements, the operation of the Governmental Program, and
compliance with the requirements contained in this Lease and the Grant Agreement, and shall,
upon ten (10) days prior written request, allow Lessor, State, and either the Legislative Auditor
or State Auditor for the State of Minnesota, upon request, to inspect, audit, copy, or abstract,
any and all of its books, records, papers, or other documents relevant to this Lease or the Grant
Agreement. Lessee shall use generally accepted accounting principles in the maintenance of
such books and records, and shall retain all of such books, records, documents and other
evidence (i) relating to the construction of the Improvements, for a period of six (6) years from
the date that the Improvements have been initially constructed and put into operation, and (ii)
relating to the operation of the Governmental Program, for a period of six (6) years from the
date such books, records, documents and other evidence are created.
Lessor agrees to protect such information as non-public or trade secret information to
the extent such protection is available under Minnesota Statutes, Chapter 13. Nothing herein
shall be construed to require Lessor to incur any costs or expenses in complying with this
provision unless Lessee agrees in advance to pay or reimburse Lessor for any costs and
expenses incurred by Lessor in complying with this agreement.
58. NON-DISCRIMINATION. Lessee agrees not to engage in unlawful
discriminatory practices with respect to the Premises or the operation or management of the
Governmental Program, and it shall, with respect thereto, fully comply with all applicable
provisions in Minn. Stat. Chapters 363A and 181, as such may be amended, modified or
replaced.
59. Intentionally omitted, provided elsewhere. See Section 26. Lessee agrees to
fully comply with all applicable provisions relating to worker’s compensation contained in
Minn. Stat. §§ 176.181 Subd. 2, and 176.182, as such may be amended, modified or replaced,
with respect to the Premises.
60. PREVAILING WAGE. Lessee agrees to comply with the applicable provisions
of Minn. Stat., Chapter 177, including, but not limited to §§ 177.41 - 177.435 as amended from
time to time.
61. Intentionally omitted.
62. REVIEW OF PLANS AND COST ESTIMATES.
a. Lessee and Lessor have complied with the applicable provisions and
requirements contained in Minn. Stat. § 16B.335, as such may be amended, modified
or replaced, for the Improvements, and the predesign package has been submitted and
approved.
b. The Lessee and Lessor have prepared a program plan and cost
estimates for all elements necessary to complete the Improvements and present them
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to Lessor and the Chairs of the Minnesota State Senate Finance committee and House
Ways and Means Committee for their recommendation, and must notify the Chair and
Ranking Minority Member of the Senate Capital Investment Committee and the Chair
and Ranking Minority Member of the House Capital Investment Committee. Such
program plan and cost estimates must note significant changes in the construction of
the Improvements, including its costs, which have arisen since the appropriation for
the Improvements was enacted.
c. Any material change from such predesign package referred to in
subsection a. hereinabove or the program plan and cost estimates referred to in
subsection b. hereinabove, must be submitted to the State for recommendation.
d. The Improvements must be (i) completed in substantial accordance
with the pre-design package referred to in subsection a. hereinabove and the program
plan and cost estimates referred to in subsection b. hereinabove, (ii) completed in
accordance with the time schedule contained in the pre-design package referred to in
subsection a. hereinabove and the program plan referred to in subsection b.
hereinabove, and (iii) completed within the budgets contained in the predesign
package referred to in subsection a. hereinabove and the cost estimates referred to in
subsection b. hereinabove except as amended by Lessee from time to time, which
amendments are approved by the State.
63. HAZARDOUS WASTE POLLUTION AND CONTAMINANTS.
a. For purposes of this Section 63, the following defined terms shall have
the following meanings:
(1) Hazardous Substance means asbestos, urea formaldehyde,
polychlorinated biphenyls (“PCBs”), nuclear fuel or material, chemical waste,
radioactive material, explosives, known carcinogens, petroleum products and
by-products and other dangerous, toxic or hazardous pollutants, contaminants,
chemicals, materials or substances listed or identified in, or regulated by, any
Environmental Law;
(2) Environmental Laws means the Comprehensive Environmental
Response, Compensation and Liability Act, 42 U.S.C. §9601 et seq., the
Resource Conservation and Recovery Act, 42 U.S.C. §6901 et seq., the
Hazardous Materials Transportation Act, §1802 et seq., the Federal Water
Pollution Control Act, 33 U.S.C. §1251 et seq., the Clean Air Act, 33 U.S.C.
§1321 et seq., the Clean Air Act, 42 U.S.C. §7401 et seq., the Minnesota
Environmental Response and Liability Act, Minn. Stat. Ch. 115B, the
Minnesota Petroleum Tank Release Cleanup Act, Minn. Stat. Ch. 115C, and any
other federal, state, county, municipal, local or other statute, law relating to
Hazardous Substances;
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b. Lessee agrees to comply with all Environmental Laws applicable to the
Premises. Lessee shall bear all costs and expenses arising from compliance with all
Environmental Laws. If Lessee fails to comply with any Environmental Laws, Lessor
shall have the right, but not the obligation, to undertake such compliance and charge
Lessee the costs of compliance plus interest at the rate of ten percent per annum
accruing from the date of disbursement and also with reasonable attorney fees.
c. Lessee agrees to defend, indemnify and hold harmless Lessor, its
officers, employees and agents (hereinafter collectively referred to as the
“Indemnitees”) from and against and shall reimburse each such Indemnitee for any
and all loss, claim, liability, damage, judgment, penalty, injunctive relief, injury to
person, property or natural resources, cost, expense, action or cause of action arising in
connection with or as the result of the existence, use, handling, storage, transportation,
manufacture, release or disposal of any Hazardous Substance in, on or under the
Premises, whether foreseeable or unforeseeable, regardless of the source, the time of
occurrence or the time of discovery (hereinafter collectively referred to as “Loss”) .
The foregoing indemnification against Loss includes, without limitation,
indemnification against all costs in law or in equity of removal, response, investigation,
or remediation of any kind, and disposal of such Hazardous Substances, all costs of
determining whether the Premises are in compliance with, and of causing the Premises
to be in compliance with, all applicable Environmental Laws, all costs associated with
claims for damages to persons, property, or natural resources, and the Indemnitees’
reasonable consultants’ fees, court costs and expenses incurred in connection with any
thereof.
d. The obligations of Lessee to indemnify the Indemnitees shall survive
expiration or termination of this Lease. The rights of the Indemnitees hereunder shall
be in addition to any other rights or remedies which the Indemnitees may have against
Lessee under this Lease or any other document, or at law or in equity.
64. WAIVER OF SUBROGATION. Lessee, on behalf of itself and its insurer,
hereby waives all claims and rights of recovery against Lessor which it would, but for this
Section, have to Lessor for losses occurring to the Premises and to the improvements,
betterments, trade fixtures, equipment, personal property and other property located therein or
thereupon:
a. to the extent actually covered by insurance required to be carried by the
party waiving; or
b. to the extent actually covered by any other insurance being carried by
the party waiving at the time of such occurrence.
65. WAIVER OF CERTAIN DAMAGES. IN CONSIDERATION OF
ENTERING INTO THIS LEASE, LESSOR AND LESSEE HEREBY WAIVE AND
FOREVER GIVE UP ANY RIGHT TO CLAIM OR RECOVER CONSEQUENTIAL
DAMAGES, INCIDENTAL DAMAGES, OR DAMAGES FOR LOST INCOME OR
SHA - Lease-Use Agreement: 03/14/2019
32
PROFITS AS A RESULT OF ANY BREACH OF THIS LEASE OR ANY
DOCUMENTS OR AGREEMENTS REFERRED TO. THE AGREEMENTS AND
WAIVERS SET FORTH HEREIN SHALL SURVIVE THE EXPIRATION OR
TERMINATION OF THIS LEASE.
66. COMPLIANCE WITH LAWS. Lessee agrees that it will comply with all
present and future laws, ordinances, and regulations, as amended and in effect from time to
time, applicable to its use, occupancy, alteration or improvement of the Premises.
67. Intentionally omitted.
68. GRANT AGREEMENT PREVAILS. Whenever there shall exist a conflict
between the provisions of this Lease and the Grant Agreement, the Grant Agreement shall
prevail. Lessor shall not amend or otherwise modify the Grant Agreement without the prior
written consent of Lessee.
69. RECITALS. The Recitals set forth above are incorporated into this Lease as of
fully set forth herein.
70. EXHIBITS INCORPORATED. The following exhibits attached hereto are
incorporated into this Lease as if fully set forth herein:
Exhibit A – Legal Description
Exhibit B – Improvements
Exhibit C – Grant Agreement
Exhibit D – Percentages and Sources of Project Funds
Exhibit E – Allocation Percentages
Exhibit F – Permitted Encumbrances
[Signature pages follow]
[Signature page to Lease/Use Agreement]
IN WITNESS WHEREOF, the parties hereto have executed this Lease the day and year
first above written.
Lessee’s address:
City of Scandia
City Hall
14727 209th Street North
City of Scandia MN 55073
LESSEE:
CITY OF SCANDIA, MINNESOTA, a Minnesota
statutory city
By
Steve Kronmiller
Its Mayor
And by
Kyle Morell
Its: City Administrator
STATE OF MINNESOTA )
) ss.
COUNTY OF WASHINGTON )
The foregoing instrument was acknowledged before me this ____ day of _________,
2025, by Steve Kronmiller, Mayor, and Kyle Morell, City Administrator, of the City of
Scandia, a Minnesota statutory city, on behalf of the City.
________________________________________
Notary Public
[Signature page to Lease/Use Agreement]
Lessee’s address:
Scandia Heritage Alliance
PO Box 159
Scandia, MN 55073
SCANDIA HERITAGE ALLIANCE,
a Minnesota nonprofit corporation
By:_________________________________
Name: Susan Rodsjo
Its Executive Director
STATE OF MINNESOTA )
) ss.
COUNTY OF WASHINGTON )
The foregoing instrument was acknowledged before me this ____ day of _______,
2025, by Susan Rodsjo, the Executive Director of Scandia Heritage Alliance, a Minnesota
nonprofit corporation, on behalf of the corporation.
________________________________________
Notary Public
EXHIBIT A
Legal Description of Premises
That certain real property located in Washington County, Minnesota, described as follows:
USE AREA PARCEL DESCRIPTION
Part of Lot 31, Auditor's Plat No. 6, in the Northeast Quarter of the Northwest Quarter of Section
23, Township 32 North, Range 20 West, Washington County, Minnesota, as per the plat thereof
on file and of record in the office of the County Recorder of said County, described as follows:
Commencing at the southeast corner of said Lot 31; thence South 89 degrees 31 minutes 15
seconds West, bearings are oriented to the Washington County Coordinate System, NAD 83,
1986 adjustment, along the south line of said Lot 31 a distance of 416.61 feet to the point of
beginning of the parcel to be described; thence North 10 degrees 41 minutes 40 seconds West a
distance of 138.66 feet; thence North 55 degrees 00 minutes 00 seconds West a distance of
206.00 feet; thence North 14 degrees 45 minutes 46 seconds West a distance of 290.21 feet;
thence North 58 degrees 43 minutes 14 seconds West a distance of 75.76 feet, more or less, to
the intersection with the boundary line of real property described in Warranty Deed, Document
Number 319741; thence southwesterly along said boundary line, being a non-tangential curve
concave to the northwest, an arc distance of 328.60 feet, said curve has a radius of 457.58 feet
and a central angle of 41 degrees 08 minutes 46 seconds, the chord of said curve bears South 51
degrees 51 minutes 07 seconds West; thence South 72 degrees 25 minutes 30 seconds West,
tangent to the last described curve and along said boundary line, a distance of 171.21 feet, more
or less, to the intersection with a line 150.00 feet East of, measured at right angles to and parallel
with, the west line of said Lot 31; thence South 00 degrees 49 minutes 14 seconds West, along
said parallel line a distance of 330.37 feet, more or less, to the intersection with the south line of
said Lot 31; thence North 89 degrees 31 minutes 15 seconds East, along said south line a
distance of 754.05 feet to the point of beginning.
This parcel contains 6.288 acres, more or less, and is subject to the right of way of Olinda Trail
North and all other easements, restrictions and covenants of record.
EXHIBIT B
Improvements
Reconstruction of the historic Scandia Water Tower Barn as an Arts and Heritage Center,
including, but not limited to:
The reconstructed Water Tower Barn for events, museum, historical and art shows and
displays, events, and meetings;
construction of an amphitheater and stage for music and theater performances and other
similar events,
construction of a water feature play area for children,
other accessory structures and hardscape such as wetland decks, coffee and food vending
structures, portable or permanent toilets, storage buildings, ticket booths and other minor
structures typical of such facilities,
site landscaping, trails, plazas, driveways, parking areas, interpretive areas and signage,
and
other improvements necessary or incidental to the program.
This description is not intended to be exhaustive and the plans and specifications approved by
the City should be referenced for a more complete description. Certain elements, other than
the Water Tower Barn and the amphitheater, may be delayed to a later time based on
construction costs.
EXHIBIT C
Grant Agreement
EXHIBIT D
Water Tower Barn Scandia Arts and Heritage Center
Sources of Project Funds
[Drafting Note: figures to be confirmed prior to closing]
SOURCES OF PROJECT FUNDS AMOUNT PERCENTAGE
Scandia Heritage Alliance 3,800,000 %
State of Minnesota $2,200,0001 %
City $ 0 0 %
Total $ 100%
1 $2,200,000 grant under the Grant Agreement.
EXHIBIT E2
Contributions of City and SHA
SOURCES OF PROJECT FUNDS AMOUNT PERCENTAGE
ALLOCATION
Scandia Heritage Alliance $3,800,000 100%
City $ 0 0 %
100%
Drafting Note: to be confirmed by SHA prior to
closing
2 Based on closing pro forma. Includes SHA in kind contributions and City agreed land value. Exact amounts to be
determined upon final completion and final draws under the Disbursing Agreement, at which time this Exhibit shall be revised
and percentages adjusted accordingly.
EXHIBIT F
Permitted Encumbrances
1. TBD from Title Commitment
CITY OF SCANDIA
RESOLUTION NO. 11 -18-25-08
AUTHORIZING THE ACCEPTANCE OF A GRANT FROM THE STATE OF
MINNESOTA TO COMPLETE THE SCANDIA WATER TOWER BARN ARTS AND
HERITAGE CENTER PROJECT
NOW, THEREFORE, BE IT RESOLVED that the City of Scandia act as the legal
sponsor for the project contained in Minnesota Laws, 2023, Ch. 72, Art. 2, §9, Subd. 7 entitled
Scandia Water Tower Barn Arts and Heritage Center.
FURTHER, BE IT RESOLVED that the City of Scandia has the legal authority to receive
financial assistance, and the institutional, managerial, and financial capability to ensure adequate
project administration.
FURTHER, BE IT RESOLVED that the Law appropriating Money to the Project is General
Fund dollars and there is no match requirement, however funds sufficient to build the project to
completion have been raised as of the current date. Additional funding will allow project
enhancements.
FURTHER, BE IT RESOLVED that the City of Scandia has not violated any Federal, State or
local laws pertaining to fraud, bribery, graft, kickbacks, collusion, conflict of interest or other
unlawful or corrupt practice.
FURTHER, BE IT RESOLVED that upon approval of its development proposal by the state,
City of Scandia may enter into an agreement with the State of Minnesota for the above-
referenced project, and that City of Scandia certifies that it will comply with all applicable laws
and regulation as stated in all contract agreements.
FURTHER, BE IT RESOLVED that the non-DEED sources of funds identified in the sources and
uses outlined in the application total the amount of $3,700,000 as of the date of this Resolution, and
are committed and adequate to fully fund the project identified in the application The City of Scandia
has provided the site valued at $200,000 and will construct a sidewalk on Olinda for access. All other
funds have been raised by the proposed user, the Scandia Heritage Alliance. The final State Grant
Agreement executed at Closing will reflect the final funding to build the Project to completion.
FURTHER, BE IT RESOLVED that any sources of the Applicant’s funds to fully fund the project
shall be from the City of Scandia’s Capital Budget (for the sidewalk) account which has an
adequate amount of funds to cover the commitment.
Resolution No.: 11-18-25-08
Page 2 of 2
FURTHER, BE IT RESOLVED that the Mayor and/or the City Administrator or City
Clerk, or the City Administrator or City Clerk designees to the extent otherwise authorized by
law, are hereby authorized to execute such agreements as are necessary to implement the projects
on behalf of the City of Scandia. Pursuant to M.S. § 412.201, Statutory Cities must authorize
both the Mayor and Clerk to execute all contracts.
Adopted by the Scandia City Council this 18th day of November, 2025.
___________________________________
Steve Kronmiller, Mayor
ATTEST:
____________________________________
Kyle Morell, City Administrator
CITY OF SCANDIA
RESOLUTION NO. 11 -18-25-09
AUTHORIZING THE MAYOR, THE CITY ADMINISTRATOR OR THE CITY CLERK
TO ENTER INTO AGREEMENTS AND UNDERTAKE ACTIVITIES TO COMPLETE
THE SCANDIA WATER TOWER BARN ARTS AND HERITAGE CENTER PROJECT
WHEREAS, the State of Minnesota has allocated $2,200,000 in the 2023 Laws of
Minnesota, Chapter 72, Article 2, Section 9, Subd. 7, to the City of Scandia as a grant (the
“Grant”) to assist the City in the predesign, design, construct, furnish, and equip of the Scandia
Water Tower Barn Arts and Heritage Center (the “Project”); and
WHEREAS, the City owns the property on which the Project will be constructed, and
has agreed to lease said property to the Scandia Heritage Association for execution of the
Project; and
WHEREAS, the City will need to review and sign documents as shown in Exhibit A,
including but not limited to: General Fund Grant Agreement, Grant Declaration, Lease/Use
Agreement, Short Form Lease/Use Agreement, Certification of Adopted Resolutions, Disbursing
Agreement, Settlement Statement for Initial Closing, First Draw, and City Zoning Letter; and
WHEREAS, the following major documents have been drafted to near if not final form:
General Fund Grant Agreement (Exhibit B) and Lease/Use Agreement (Exhibit C).
NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF
THE CITY OF SCANDIA, WASHINGTON COUNTY, MINNESOTA: That the Mayor and
the City Administrator and/or the City Clerk are hereby authorized to enter into the General Fund
and Grant Agreement and the Lease/Use Agreement substantially in the form as attached hereto;
FURTHER, BE IT RESOLVED,
That the City Administrator or the City Administrator’s designee are hereby authorized
to:
i. Enter into and execute all other contracts, agreements, and documents, subject to
the review and approval of the Scandia City Attorney, and
ii. Undertake all activities reasonably necessary to complete the Scandia Water
Tower Barn Arts and Heritage Center Project.
Resolution No. 11-18-25-09
Page 2 of 2
FURTHER, BE IT RESOLVED, that the City Council authorizes the waiver of
performance bonds, subject to the review and approval of construction contract(s) and
escrow/disbursement agreement(s), and further subject to the satisfaction of the City
Administrator and the City Attorney that such documents provide sufficient security in lieu of
performance bonds.
Adopted by the Scandia City Council this 18th day of November, 2025.
___________________________________
Steve Kronmiller, Mayor
ATTEST:
____________________________________
Kyle Morell, City Administrator
Resolution No. 11-18-25-09
Page 2 of 2
EXHIBIT A
Documents
Kyle, Eric, and Steve,
Earlier in the summer, Scandia Heritage Alliance (“SHA”) wrote to request the City waive the
Payment and Performance Bond (the “PPB”) for the Water Tower Barn Project and join us in
requesting that the Minnesota Department of Employment and Economic Development (DEED) do
the same. In keeping with Eric’s suggestion we approach to have “all our ducks in a row” this fall,
we would like to include this discussion at the November Council meeting. In addition, since our
prior letter, an additional important factor is now fully in place to make a waiver more appropriate:
SHA’s plan to direct purchase building materials, discussed below. If the Council discussion in
October is supportive on the PPB, we can then jointly seek the approval of DEED this fall,
preparatory to our final document drafting for the closing.
PPBs are very expensive--in this project, all the contractors we are negotiating with are bondable,
but the cost is estimated at $25,000-$30,000, a significant sum in our construction budget. We
would much prefer to have this amount for project enhancement. Many factors have led our project
team (Owner’s Representative, Architect, Real Estate Advisor) to recommend that SHA seek this
waiver so this significant sum is available for Project costs. As we indicated before, PPBs are
frequently waived in projects like the Water Tower Barn, because the bonds are expensive and
collecting on the bonds is generally acknowledged to very difficult and heavily litigated, and, most
importantly, we will have payment and performance safeguards in place,
The Project will have in place many factors making bonding here not appropriate and necessary:
1) Very importantly, and in our bid documents, before, SHA has provided it will purchase the
building materials and other sales taxed services directly. Thus the title to roughly one-third of
the project costs will NOT be with the contractor. These items will be separated in the draws and
NOT paid for until delivered to the site. This makes the risk ratio much lower reducing the
benefit of the bond.
2) The bond cost is unusually high for the Project value, making it an unwise investment, and
particularly so given two special factors in this case.
a) The bond is based on the total Project cost, however, as noted above, materials will be
purchased directly by SHA to qualify under the SHA sales tax exemption. These are
therefore paid for directly by SHA only on delivery and upon invoicing. Title assures
payment directly to the vendor;
b) One of the largest costs of this Project is for site work. This will be at the Project inception
and by a subcontractor of significant size (the most likely contender is Peterson
Companies of Chisago City, who we have been working with). The risk that site work will not
be performed properly is minimal, because of the size of the subcontractors selected for
bidding, timing of the work, the ease of monitoring performance, and the multiple agencies
involved in this phase of work (City engineer and building inspector, SHA’s civil engineers,
the Watershed District, the Washington County Conservation District, the architect, and the
Owner).
3) Most importantly, the project will have progress payments, only after work is done, with
multiple checks and balances to ensure the contractors are never ahead of the payments. The
result is that adequate funds will be available to complete the project even if the selected
contractor fails to reach completion—which is what the PPB would provide. These funds are
always in the control of the owner. The construction contract will provide:
a) Retainage on all work at 5%, until substantial completion;
b) A draw process where the architect approves each draw from the contractor and each of
the City, State, and SHA approve each draw, providing a clear process to assure no
payment is made for uncompleted work. This assures that any issues are raised early, not
after funds are disbursed; and
c) The draw process assures that all payments trail the work. Because the payment
process includes multiple steps -- contractor draw preparation; architectural inspection; City,
State, and SHA approval; State disbursement; and Title processing, and the process
normally takes a minimum of 30 days. Performance trailing the work allows notice of any
issues with performance and their correction. And the Title disbursement draw process
provides direct payment to subcontractors, assuring they do not have claims for unpaid
amounts and that sufficient funds to complete are always available.
4) Finally, SHA guarantees the Project completion to the City, making the City far less at risk than
in a case where it is the direct contracting party. SHA believes a PPB waiver makes sense here.
SHA can and will, throughout construction, take steps to assure work is being done promptly,
and on schedule. With architect and engineer observation and the nature of the project, SHA
has in place a team with the experience and skills to assure effective supervision and
monitoring.
Based on the above, SHA requests the City agree to approve the PPB waiver here and join SHA in
requesting the same waiver from DEED. This will facilitate our bidding and document drafting.
Thank you for your early response as it impacts our budgeting and it requires the subsequent
discussion with DEED.
Scandia Heritage Alliance
Susan Rodsjo, Its President
and
Herman Real Estate Advisors LLC
John Herman, Project Real Estate Advisor