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HomeMy WebLinkAbout02-26-07 Item 7A, Preliminary Development Agreement ~ ~HILLS Request for Council Action Prepared By: Dept.: Karen Barton v.i3 Agenda Item: Motion to approve the Preliminary Development Agreement and Amendment to the _~,:,ncli.r,:g cu1<:t Q_~~ra~~Y_!'_9_~_e:~_rl)~~t 1:J~_~~~n,tll~_<:;i!y _and eRR, LLC - - Budgeted Amount: . - . . N/A Actual Amount: N/A Funding Source: __ N/A 7A Community Development Council Mtg. Date: Final Action Needed By: 02/22/07 :counCifActiC)n--R~-ue~t" _' Motion to approve the Preliminary ()evelopment.Agreement anclfirstAmerldment toiheFundingand Guaranty agreement between the City and eRR, LLC for the purchase and redevelopment of the TeAAP property. Staff Recommendation: Motion-to approve-the Preliminary Development Agreement and the fjrst Amendment to the Funding and Guaranty agreement between the City and CRR, LLC for the purchase and redevelopment of the TCAAP property. Planning: N/A N/A '~.UPp,8rji~g_Qcl,~~iil~ri~':,:,{~~g~_~) X Memo/Letter: 02108/07 Resolution No.: Ordinance No.: Engineering Recommendation: Attorney Recommendation: X Other: first Amendment to Funding and Guaranty Agreement; Original Funding and Guaranty Agreement ~'financf~(rrnplicaY(?~_:___ ____ """ _ . Recovery and reimbursement of city expenditures relating to the purchase and redevelopment of the TCAAP property. Administrator/Staff Comments: ~ ~ EN HILLS MEMORANDUM DATE: February 22, 2007 Agenda Item 7 A TO: Mayor and City Council Michelle Wolfe, City Administrator Karen Barton, Community Development Director ~ FROM: SUBJECT: Preliminary Development Agreement Review Attached is the revised final draft to the Preliminary Development Agreement (PDA) between the City and CRR, LLC for the purchase and redevelopment of the TCAAP property, and a proposed Amendment to the Funding and Guaranty agreement between the City and CRR, LLC. Mr. BubuJ of Kennedy and Graven will be present to review the documents with Council at the meeting Monday night. Ciryof Arden Hills Cit}' Council ~1'yfeeling Februmy 12, 2007 ,IMetro-inel.uslardenhil'sl.Planning\Commul7iry Del'elopmenf\CoLll1cil Agenda !remslPreliminary Del"elopmeJlf Agreemem Rel"int" memo 10 counciIO]-22-07-doc Page I ofl .> February 16,2007 PRELIMINARY DEVELOPMENT AGREEMENT THIS AGREEMENT is made and entered into as of this day of , 2007 by and between the CITY OF ARDEN HILLS, a Minnesota municipal corporation (the "City"), and CRR, LLC, a Delaware limited liability company (the "Developer"). RECITALS WHEREAS, the City and Developer entered into that certain Interim Agreement dated as of August 26, 2002, and amended by Amendment No. I thereto dated October 25, 2004 (together, the "Interim AgreemenC), regarding the acquisition and redevelopment of a portion of the Twin Cities Army Ammunition Plant (the "TCAAP Site") in the City; and WHEREAS, the Interim Agreement expired in accordance with its terms on May 9, 2005; and WHEREAS, the parties have determined to amend and restate the Interim Agreement by entering into this Agreement; and WHEREAS, this Agreement concerns the portion of the TCAAP Site described in Exhibit A hereto (the "Development Property"), which property is expected to be acquired by the City from the United States of America acting by and through the General Services Administration (the "GSA") pursuant to the terms of an Offer to Purchase between the City and GSA dated August I, 2006 as amended by a letter amendments thereto dated August 11,2006, November 15, 2006, and February 12, 2007, and additional amendments entered into from time to time (together, the "OTP"); and WHEREAS, the Development Property is now occupied by the former Twin Cities Army Ammunition Plant, which has been abandoned and is being disposed of by GSA on behalf of the United States of America; and WHEREAS, the City has engaged in a comprehensive planning process to guide the redevelopment of the Development Property, which process is intended to remove impediments to development, maximize the property's potential for revitalization of the City and surrounding region, increase tax base for the City and all taxing jurisdictions, and increase commercial and housing opportunities at this critical site in the City; and WHEREAS, the parties acknowledge that there are significant environmental issues affecting the Development Property, and that redevelopment of the property will require zoning changes, significant remediation activities and substantial infrastructure improvements; and WHEREAS, the parties further expect that the City, upon acquisition of the Development Property from GSA, will simultaneously convey the Development Property to Developer pursuant to the terms of a master development agreement ("MDA") to be negotiated as further described herein; and WHEREAS, in light of such expected real estate transaction, the City has also entered into that certain Funding and Guaranty Agreement with Developer, Ryan Companies, Inc. ("Ryan") and Rehbein Companies, Inc. ("Rehbein") dated as of August 10, 2006, as amended by a First Amendment thereto dated , 2007, and as it may be further amended from time to time (the "Guaranty"); and WHEREAS, Ryan and Rehbein are the principals of Developer, and those three entities entered into the Guaranty in order to evidence their obligation to pay all earnest money and the Purchase Pricc (as defined in the Guaranty) required to be paid by the City to GSA under the OTP; and WHEREAS, under the terms of the Guaranty, the City and Developer agreed to negotiate the tenus of an MDA concerning the Development Property and the parties' respective responsibilities in developing such property and setting forth those matters that need to be completed prior to closing on the acquisition of the Development Property under the OTP (referred to hereafter as the "Closing"); and WHEREAS, the parties have determined to describe their respective responsibilities prior to Closing; and WHEREAS, the City Council has adopted an overall concept plan for the Development Property, designated as the TCAAP Framework Vision approved by the City Council on January 13,2005 and attached hereto as Exhibit B, and as it may be refined and amended from time to time (the "Framework Vision"); and WHEREAS, the City's Economic Development Commission and City Council have adopted a TCAAP Public Financing Policy (the "Public Financing Policy"), setting forth the general principles that will guide the City's financial participation in the Development; and WHEREAS, the Developer proposes to redevelop the Development Property as a mixed- use project consisting of residential uses with compatible and mutually supporting office, retail, services, hotel, community and civic use, office/warehouse and other uses (referred to generally as the "Development"); and WHEREAS, the City Council has acknowledged the Developer's desire to enter into this Preliminary Development Agreement to allow the Developer to further refine its proposal and to negotiate with the City concerning the redevelopment described in this Agreement; and WHEREAS, the City and the Developer acknowledge that the purchase and redevelopment of the Development Property is mutually beneficial to City and Developer, and therefore the parties desire to proceed with the Development if the conditions described herein are satisfied. 2 NOW, THEREFORE, in consideration of the covenants and obligations of the parties hereto, the City and the Developer hereby agree as follows: Section I. Preliminary Nature of Agreement. The City and the Developer agree that this Agreement is intended to be preliminary in nature. Before the City and the Developer can make a decision on whether to proceed with the implementation of the Developer's development proposal for the Development Property, it will be necessary to assemble and consider information relative to the design, financial feasibility and other aspects of redevelopment of the Development Property. The purpose of this Agreement is to allow the Developer an opportunity to assemble such necessary information, and to negotiate with the City concerning the execution of an MDA which, if executed, will set forth the rights and responsibilities of the City and the Developer with respect to the Development Property. Section 2. Present Intent of Parties. It is the intention of the parties that this Agreement documents their present understanding and commitments, and that the parties will proceed to use their best efforts to negotiate a mutually satisfactory MDA, which MDA will (i) include conveyance of the Development Property to the Developer pursuant to all tenus of the OTP and MDA, and (ii) will require fulfillment of the following conditions to the mutual satisfaction of the parties: (a) the Developer demonstrates the market feasibility ofthe Development; (b) the Developer demonstrates the ability to undertake the Development in a manner consistent with the general land uses described in the Framework Vision; (c) the Developer demonstrates that projected sources of financing for the Development will be available to the Developer, and that if Developer requests financial assistance from the City, such assistance is necessary to make Developer's redevelopment proposal financially feasible and is consistent with the Public Financing Policy and taking into account the unique needs of the Development; and (d) if the City agrees to provide any financial assistance, the Developer and the City are able to reach agreement on the Developer's provision of security adequate to reasonably justify the City's investment. (e) remediation of the Development Property as set forth in the Remedial Action Plan approved by the MPCA in accordance with the Response Action Agreement; and (f) the Developer and the City are able to reach agreement on the type and amount of envirornnental and general liability insurance that the Developer will provide on the Development Property to protect the interests ofthe City. The MDA (together with any other agreements entered into between the parties hereto or contemporaneously therewith) when executed will supersede all obligations of the parties hereunder. 3 Section 3. Developer Undertakings. (a) In addition to all its other obligations under this Agreement, the Developer shall submit to the City the following items at the following times: (I) Within 90 days after receipt of each written request by the City from to time, the Developer shall submit, in forms reasonably required by the City in order to undertake the Alternative Urban Areawide Review ("AUAR") process: (i) preliminary (and periodically updated) site plans for the Development Property, and (ii) preliminary (and periodically updated) development schedules for the Development, including preliminary phasing and staging plan (2) Within 30 days after the City and GSA (with Developer's consent) have entered into a written agreement regarding the amount of remediation credit and the credit mechanism under the OTP, Developer shall submit a preliminary project proforma with estimated costs of the Development and possible sources and uses of all funds to finance such costs; and (3) Within 30 days after the draft of the AUAR is submitted forreview and comment in accordance with Minnesota Rules, Chapter 4410, Developer shall submit a preliminary report on the market feasibility ofIand uses designated in the AUAR. (b) Developer on behalf of the City shall identify the nature, extent and cost of remediation. Developer shall determine the terms and conditions of the Memorandum of Agreement (as defined in Section 28 of the OTP). Also, Developer shall cooperate and participate with the City in negotiations with GSA regarding any necessary amendments and clarifications to the OTP; obtaining access to the Development Property; obtaining from GSA and U.S. Army all environmental reports and information regarding the Development Property; determining the mechanism for applying remediation costs as a credit against the purchase price and the amount of such credit; obtaining changes to the FOST and FOSET (as defined in Section 5 of the OTP); obtaining acceptable terms for the Covenant Deferral Request process for early transfer under Section 24 of the OTP and the timing thereof; all other matters under the OTP; the terms and conditions relating to the conveyance and remediation of the Wildlife Area and the Athletic Field Area; and the matters set forth in this Section 3 and in Section 5(a) through 5(f) and Section 7 below. As used in this Agreement, the "Wildlife Area" and the ""Athletic Field Area" shall mean the portions of the Development Property designated on Exhibit B. (c) Developer shall provide, upon the reasonable request of the City staff from time to time, reports as to the Developer's progress in assembling the information necessary to comply with the tenns ofthis Agreement. (d) Guaranty. Developer agrees to fund the earnest money as provided in Section 3.0B of the 4 (e) Developer agrees to assume the obligations of the City as provided in Section 3.0C ofthe Guaranty. The costs of all undertakings by the Developer under this Section 3 shall be borne solely by the Developer unless and to the extent any such costs are Developer Reimbursable Costs as defined in Section 5 (t). All of the information and materials described in this Section 3 shall be the property of the Developer, unless and to the extent the cost of any information and materials is paid by the City as Developer Reimbursable Costs under Section 5(t)(2) hereof Section 4. City Undertakings. In addition to all its other obligations under this Agreement, during the term of this Agreement the City shall do the following: (a) Make City staff and consultants reasonably available (taking into account their other City duties and services) for consultation with respect to the matters set forth in Sections 3, 4, 5 and 7. (b) Cooperate and participate with the Developer in: negotiations with GSA regarding any necessary amendments to the OTP; obtaining access to the Development Property; obtaining from GSA and U.S. Army all environmental reports and information regarding the Development Property; identifYing the nature, extent and cost of remediation; determining the mechanism for applying remediation costs as a credit against the purchase price and the amount of such credit; determining the terms and conditions of the Memorandum of Agreement; obtaining changes to the FOST and FOSET; obtaining acceptable terms for the Covenant Deferral Request process for early transfer and the timing thereof; all other matters under the OTP; the terms and conditions relating to the conveyance and remediation of the Wildlife Area; and the Athletic Field Area and the matters set forth in this Section 4, Section 5 and Section 7. (c) Grant to the Developer, at its cost, all rights of access to the Development Property to conduct all investigations and tests relating to the environmental, geotechnical and other physical conditions of the Development Property, all to the extent such rights are available to the City under the OTP, subject to these conditions: (i) Developer shall maintain on file with the City a list of entities that will enter the Development Property and the name of Developer's contact person regarding access by any entity. (ii) Developer and City shall jointly negotiate with GSA regarding all procedures and rules regarding access to the Development Property. (iii) Developer shall indemnifY and hold harmless the City for any claims arising from Developer's entry on the Development Property, and shall at all times maintain with the City a certificate 5 of insurance evidencing that Developer has insurance regarding such risks. City shall tender to Developer any claims subject to indemnification under this clause immediately after its knowledge of any such claims, and shall permit Developer to defend and/or resolve any such claims. (iv) Developer shall keep the Development Property free of all liens and shall repair any damage that is caused to the Development Property caused in any way by Developer's entry on such property. Developer shall have the right to contest any liens, provided that Developer provides the City and GSA with collateral (such as a bond or title insurance insuring over such lien) reasonably acceptable to the City and GSA. (d) Evaluate the financial and market feasibility of the undertakings of the Developer as specified in Section 3 of this Agreement. (e) Consider options for public financial assistance as part of the Development, if the Developer is able to demonstrate a need for public financial assistance as determined by the City in its sole discretion. (f) Evaluate the availability of public financing tools related to the Development, and commence any actions necessary to implement any such tools approved by the City Council. (g) Coordinate with Developer in developing an infrastructure plan consistent with the Development plan. (h) Consider and evaluate any requests by Developer to seek special legislation that may be necessary to carry out the Development. (i) Make available to the Developer at the City's offices all environmental reports, studies and information in the possession of the City from time to time. G) Forward to Developer all communications it receives from or sends to GSA or the Minnesota Pollution Control Agency ("MPCA") and all communications it receives from or sends to the EP A or the Governor's office relating to the submission of the CDR request to the EP A and/or Governor and the approval of the CDR by the EP A and/or Governor; provided that the City has no obligation to forward any document that is "not public data" as defined in Minnesota Statutes, Section 13.02, subdivision 8a, unless (a) the transfer to Developer is permitted under Minnesota Statutes, Chapter 13 and (b) the transfer would not change the status of the document to public data on individuals or public data not on individuals within the meaning of Minnesota Statutes, Chapter 13. 6 (k) Tender its earnest money and Purchase Price (as defined In the Guaranty) as provided in Sections 3.0B and 3.0C of the Guaranty. (I) Perform all of its obligations as the Purchaser under the OTP, subject to (i) the performance by Developer of its obligations as provided in Sections 3.0B and 3.0C of the Guaranty and (ii) Section ]0 of this Agreement. The cost of all undertakings by the City under this Section shall be payable by the Developer to the extent any such costs are City Reimbursable Costs as defined in Section 5 and subject to reimbursement as provided therein. 5. City Reimbursable Costs. (a) Defined. Developer will reimburse the City for all "City Reimbursab]e Costs" in accordance with this Section. The term City Reimbursable Costs means the following costs, but only to the extent that such costs are included in the Budget (as defined below): (I) Out-of pocket-costs incurred by the City from and after May 9, 2005 for (i) the City's financial advisor in connection with the Development, (ii) the City's legal counsel in connection with negotiation and drafting of this Agreement, the MDA, the OTP, the Memorandum of Agreement (as defined in the OTP) and any related agreements or documents; (iii) the City's planning consultant in connection with redevelopment of the Development Property; and (iv) any other third-party costs in connection with acquisition of the Development Property from GSA and conveyance to the Developer, or in connection with the City's financial participation, if any, in the Development (including without limitation appraisers, surveyors and environmental consultants); and (2) The cost of City staff retained in whole or in part specifically to carry out City responsibilities with respect to the Development (including usual and customary costs and disbursements incurred by such staff), provided that (i) the cost of such staff (for purposes of determining City Reimbursable Costs) must be based upon hourly rates that the City and the Developer have agreed upon in writing as part of the Budget; and (ii) if such staff has multiple duties, only the portion of staff time related to the Development shall be treated as a City Reimbursable Cost. Notwithstanding anything to the contrary, the Developer may request that the City cease incurring all or any portion of the City Reimbursable Costs as designated by the Developer, by delivering written notice to the City including a detailed explanation for the objection to the designated costs. The City shall, within 10 business days after receipt of Developer's notice, give Developer written notice that it either (I) accepts Developer's objection, in which case the Developer will not be responsible for the designated City Reimbursable Costs effective as of two (2) business days after the date of the City's notice of acceptance, or (2) denies Developer's objection, in which case the Developer remains responsible for the designated City Reimbursable Costs, except as hereinafter provided and subject to Developer's rights under Section 23 hereof. Developer remains obligated to pay any disputed City Reimbursable Costs pending any proceeding under Section 23. 7 (b) Prior Costs. Upon execution of this Agreement, the Developer has deposited with the City $ (receipt of which the City acknowledges) representing reimbursement of all City Reimbursable Costs incurred from May 9,2005 through the date of this Agreement, and not previously reimbursed by Developer, all of which are set forth on the attached Exhibit C. (c) Budget and Consul/ant Process. The current budget of City Reimbursable Costs, including the type and scope of work and the current list of consultants is attached as Exhibit D, which may be amended from time to time by mutual agreement (the "Budget"). The City may, without amending the Budget, replace or retain any additional consultants or staff consistent with the type and scope of work described in the Budget, subject to the total amount of City Reimbursable Costs specified in Exhibit D. If the City proposes to (i) engage any different consultants or staff than those shown in the attached Budget, or (ii) allocate savings in a line-item in the Budget to pay additional expenses over the amount for another line-item, the City will (before engaging the consultant or incuning the additional line-item expense) provide Developer with at least 10 business days notice, including (in the case of clause (i) above) a written description of the consultant or staff, the scope of work and the estimated cost; and (in the case of clause (ii) above) an explanation of the reasons for the line-item change; and in either case offering Developer an opportunity to comment within the 10-day period. The City agrees that all contracts with consultants will be terminable immediately upon notice without penalty and will provide for payment for services rendered only prior to such termination. If the City or Developer proposes to revise the Budget (including changes in type or scope of work or the total amount of City Reimbursable Costs), then the City or the Developer, as the case may be, shall submit a revised budget to the other party and an explanation of the changes to the Budget, and allow thirty (30) days for the other party to approve the changes to the Budget. If the other party approves the proposed changes to the Budget, the changes shall be incorporated into the Budget, the revised Budget shall be signed by the City and the Developer, and the revised budget shall become the Budget. If the City's or the Developer's proposed changes to the Budget are not approved by the other party within such thirty (30) days, then either the City or Developer may terminate this Agreement under Section 12(a) hereof, subject to the tenns of Section 23 hereof. (d) Payment Process. The City will provide the Developer with a copy of all invoices received by the City immediately upon receipt of such invoices for City Reimbursable Costs, including copies of invoices provided by third parties and in the case of eligible staff costs a city- prepared invoice showing time, hourly rates (consistent with the Budget), any costs and disbursements, any description reasonably needed to explain how the staff costs relate to the Development and such other reasonable information regarding the City Reimbursable Costs as Developer requests. Developer shall pay City Reimbursable Costs to the City within thirty (30) days after receipt of each invoice; provided, however, Developer shall not be required to pay the City Reimbursable Costs to the City more often than monthly. If the Developer fails to pay the City Reimbursable Costs to the City as provided herein, then Developer shall reimburse the City for its out-of-pocket costs incurred in collecting the City Reimbursable Costs, including reasonable attorneys fees. (e) Security. As security for Developer's obligations under this Section, Developer shall, within thirty (30) days after the date of this Agreement, deposit $50,000 in escrow with an 8 escrow agent of Developer's choice, pursuant to an escrow agreement among Developer, City and the escrow agent in a form reasonably acceptable to the City. The escrow agreement shall provide for the right of the City, after three (3) days written notice to Developer, to draw on the amount in escrow to pay City Reimbursable Costs which have not been paid by Developer pursuant to this Agreement. Additionally, the escrow agreement shall provide that each time the balance in the escrow drops below $50,000, Developer shall replenish the escrow to $50,000 within ten (10) days after written notice from the City or the escrow agent. City Reimbursable Costs are also payable from any offset of returned earnest money and Developer Reimbursable Costs, as described in Section 12(b )(iii) hereof. (f) Termination. (I) Upon expiration or earlier termination of this Agreement in accordance with its terms, the City will release the escrow to the Developer less any draw needed to pay the City any City Reimbursable Costs accrued through two (2) business days following the date of the City's termination of this Agreement or the City's receipt of the notice of termination from the Developer. For the purposes of this paragraph, City Reimbursable Costs are considered to be accrued if they relate to services performed and are payable under a contract entered into on or before two (2) business days following the City's receipt of the notice of termination. (2) If this Agreement is terminated before its expiration or the term expires with or without an MDA, and the City within two years after the effective date of termination or expiration enters into a definitive development agreement with another developer who is not an Affiliate as defined in Section 6 hereof (the "Successor Developer") regarding all or a portion of the Development Property (the "New Development Property"), then the City will reimburse Developer for the Developer Reimbursable Costs described on the attached Exhibit E (the "Developer Reimbursable Costs"), except as otherwise provided in clause (3) of this Section 5(f). If the New Development Property consists of property less than the entire Development Property, the amount payable under this clause is the product of (a) the Developer Reimbursable Costs, multiplied by (b) a fraction, the numerator of which is the area in square feet of the New Development Property, and the denominator of which is the area in square feet of the Development Property ruinus the combined area in square feet of the Wildlife Area and the Athletic Field Area. (3) If this Agreement is terminated before its expiration because of rescission of the OTP initiated by Developer under Section 10(b) hereof, the Developer Reimbursable Costs will exclude any costs for Item I (Framework Vision) and Item 8 (Development of the TIF District) on Exhibit E. (4) Notwithstanding the expiration or earlier termination of this Agreement, the terms and conditions of paragraph (f)(I-3) shall survive the expiration or termination of this Agreement. Section 6. Exclusive Development Rights. During the term of this Agreement, the City designates Developer as the sole master developer of the Development Property, and agrees that it will not negotiate or contract with any other party concerning the sale or development of the Development Property. The Developer shall not without the prior written consent of the City (a) assign or transfer its rights under this Agreement, in full or in part, other than to an Affiliate, or (b) 9 undertake a merger, acquisition, reorganization or similar transaction unless the resulting entity is an Affiliate. For the purposes of this Section, the term '"Affiliate" means any corporation, partnership, limited liability company or other business entity or person controlling, controlled by or under common control with Ryan or Ryan and Rehbein. For the purpose hereof the words "controlling", "controlled by" and "under common control with" shall mean, with respect to any corporation, partnership, limited liability company or other business entity, the ownership, directly or indirectly, of fifty percent or more of the (i) the voting interests in such entity, or (ii) the power to direct or cause the direction of management policies of such entity, whether by way of ownership of voting securities or by contract or otherwise. Section 7. Negotiation ofMDA. Upon execution of this Agreement, the City and the Developer shall proceed with the negotiation of an MDA regarding the Development consistent with the terms set forth in this Agreement and use their best efforts to execute an MDA. The execution of the MDA shall be subject to all of the following: (a) All terms of the MDA are acceptable to the City and the Developer. (b) The City's financial consultant provides to the City a report indicating that: (i) Any public financial assistance is necessary and appropriate, and is financially feasible for the City in light of its other redevelopment and economic development goals; and (ii) Based on a review of the market study and pro forma provided by the Developer, the proposed redevelopment and its financial feasibility are supportable by projected market conditions. (c) All the conditions stated in Section 2 hereof are either satisfied or are set forth as conditions that must be satisfied by the Developer under the MDA before the Developer can proceed with redevelopment of the Development Property. J .~./. Section 8. Effect of Approvals. No approval given by the City hereunder or in connection herewith shall be deemed to constitute an approval of the Development for any purpose other than as stated herein and the process outlined in this Agreement shall not be deemed to supersede any concept review, conditional use permit, vacation, subdivision, rezoning or other zoning or planning approval process or public financing process of the City relative to the development of real estate or condition of receiving any grant funds. Section 9. Modifications. This Agreement may be modified and the term thereof may be extended only through written amendments hereto signed by the parties to this Agreement and approved by the City Council. Section 10. Rights Regarding OTP. (a) The City may only rescind or terminate the OTP pursuant to the terms thereof, including, but not limited to Section 5 thereof under the following terms and conditions: 10 (i) The City determines that the grounds exist for rescission or termination under the terms of the OTP; and (ii) This Agreement expires or the City has terminated this Agreement pursuant to Section 12(a)(i) hereof prior to the execution of an MDA- If the foregoing conditions are satisfied, the City may deliver to GSA a notice of rescission or termination of the OTP effective upon receipt thereof by GSA. (b) The Developer may require that the City either repay to Developer the amount ofthe earnest money the Developer has paid to the City ( the "Developer Earnest Money") or terminate the OTP pursuant to the terms thereof, including, but not limited to Section 5, under the following terms and conditions: (i) The Developer determines that the grounds exist for reSCISSIon or termination under the terms of the OTP; and (ii) The Developer provides written notice to the City explaining why Developer may not want to proceed with the Development and the grounds that exist for the City's rescission or termination of the OTP (the "Initial Developer Notice"); and (iii) No sooner than sixty (60) days after the date of delivery of the Initial Developer Notice and at least thirty (30) days before the designated date of repayment of Developer Earnest Money or rescission or termination of the OTP, the Developer may, in its sole discretion, provide written notice to the City directing the City to select one of the following options: (I) repay to the Developer the Developer Earnest Money; or (2) rescind or terminate the OTP (the "Second Developer Notice"). Within such 30-day period, the City in its sole discretion shall either (3) pay the Developer Earnest Money to the Developer by wire transfer of funds to such account as designated by the Developer, or (4) forward to GSA and others as required by the OTP, the City's notice of rescission or termination of the OTP for the reasons stated in the Initial Developer Notice and/or Second Developer Notice, and such rescission or termination shall be effective as of the date designated in the Second Developer Notice. (iv) Notwithstanding Section I O(b )(i),(ii) and (iii) to the contrary, if the Covenant Deferral Request has been signed by the Governor of the State of Minnesota and the EP A Administrator either before or after the Developer initiates action under this Section lO(b), then Developer shall only need to provide written notice to the City at least two (2) business days before the designated effective date of repayment of Developer Earnest Money or rescission or termination, which notice explains the grounds for rescission or termination of the OTP (the "CDR Developer Notice"). Within two (2) business days after receipt of the CDR Developer Notice, the City shall either pay the Developer Earnest Money to the Developer by wire transfer of funds to such account designated by Developer or forward to GSA and others as required by the OTP the City's notice of rescission or termination of the OTP for the reasons stated in the CDR Developer Notice, and such rescission or termination shall be effective as of two (2) business days after the City's receipt of the CDR Developer Notice. II (v) Notwithstanding anything to the contrary in this Agreement, at any time after receipt of an Initial Developer Notice under this Section IO(b), the City may in its sole discretion negotiate with: (I) the Developer to avoid the Second Developer Notice being sent; (2) the GSA regarding extensions to the OTP: (3) any other party regarding the acquisition and redevelopment of the Development Property; or (4) any combination thereof. (c) In the event (i) of rescission or termination of the OTP initiated by either the City or Developer under paragraphs (a) or (b) of this Section 10, (ii) of rescission or termination of the OTP by GSA under the terms of the OTP, including but not limited to Section 5(d) thereof; or (iii) the City is otherwise entitled to receive or does receive a refund of all or any portion of the earnest money from the GSA pursuant to the terms of the OTP, then the Developer is entitled to such refund of all or any portion of the earnest money. In the event the City receives a refund of all or any portion of the earnest money from the GSA, regardless of the circumstances, the City agrees to promptly remit such refund after its receipt to Developer without interest. If the City fails to wire transfer the earnest money which it receives from the GSA to the Developer at an account designated by the Developer within five (5) business days following the City's receipt of such earnest money from the GSA, then the City shall reimburse the Developer for all of its out-of- pocket costs incurred in collecting the earnest money, including reasonable attorneys fees. (d) If any of the events described in Scction 10(c) occur, the City shall collect all earnest money due to the City pursuant to the terms of the OTP, subject to the following (i) the Developer shall decide what actions shall be taken to collect the earnest money, (ii) the City shall retain the attorneys and consultants requested by Developer to collect the earnest money, (iii) the Developer shall participate in all aspects of such actions to collect the earnest money, (iv) no resolution of any dispute with regard to the earnest money shall be agreed upon without the written consent of the Developer, (v) upon the City's collection of any earnest money paid under the OTP, such earnest money shall be promptly paid to the Developer as provided in Section lO(c) and (vi) the City shall fully cooperate with the Developer in pursuing the collection of the earnest money. Developer shall pay all of the out-of-pocket expenses incurred by the City in taking actions to collect the earnest money, so long as such actions are pursuant to the written direction of the Developer. (e) The City may, or upon Developer's written request, it shall request that the GSA consent to the assignment by the City to the Developer of all of the City's right, title and interest in and to the earnest money, including the right to collect the earnest money, all pursuant to the tenus and conditions of the OTP. If the GSA consents to such assignment, then from and after the duly executed consent by the GSA to such assignment to the Developer, the City shall no longer have any responsibility to collect the earnest money, other than the City is obligated to cooperate with Developer regarding the Developer's actions to collect the earnest money. (f) The City will not take actions or fail to take actions that constitute revocation or default under the OTP, including, but not limited to Section 7, except and to the extent such actions or omissions are the result of acts or omissions of Developer under Sections 3(d) or 3(e) of this Agreement. In the event the earnest money may be forfeited at the option of GSA pursuant to Section 7 of the OTP, the Developer's rights to have the City pursue the collection of the earnest money are the same as described in Section lO(c), (d) and (e). If the City receives a notice of 12 default under the OTP (the "OTP Default Notice"), the City shall within one (I) business day thereafter forward a copy of the OTP Default Notice to the Developer. The City shall provide Developer with reasonable updates of the action being taken by the City to cure such default. If at any time the Developer reasonably believes that the City is not proceeding diligently to cure the default within the time period provided under the OTP, the Developer may take such actions on behalf of the City as it reasonably deems necessary to cure the City's default pursuant to the OTP Default Notice. Section 1 I. Term of Agreement. (a) This Agreement shall be effective through March 31, 2008, subject to earlier termination in accordance with Section 12. If for any reason an MDA has not been entered into by the parties within the term of this Agreement or any other mutually approved extension thereof, this Agreement shall be null and void and neither party thereafter shall have any liability or obligations to the other except as otherwise provided in Section 12( c) in this Agreement. Section 12. Defau1t1Remedies. (a) This Agreement may be terminated by the City or the Developer, only upon thirty (30) days' written notice to the other if: (i) The other party fails to perform any of its obligations hereunder or fails to agree to proposed changes to the then existing Budget, and fails to cure such default or agree upon such changes to the Budget within thirty (30) days after receipt of written notice thereof from the party wanting to terminate this Agreement which notice cxplains the nature of the default or the change to the Budget, and the OTP is terminated in accordance with Section lO thereof; or (ii) The OTP is terminated, including the rescission of the offer, in accordance with Section 10 hereof. Upon termination under this Section 12(a), neither party thereafter shall have any liability or obligations to the other party except as otherwise provided in Section 12(b) and (c) of this Agreement. (b) Upon the termination ofthis Agreement pursuant to Section 12(a) above: (i) If either party terminates this Agreement, then (I) the City shall give prompt notice to its consultants and its staff, and to any other parties performing work or services the cost of which qualify as City Reimbursable Costs, to promptly cease providing any further work or services on or related to the Development, unless City agrees to be responsible for such costs; and (2) notwithstanding the provisions of Section 5, City Reimbursable Costs will not include any such costs or expenses incurred from and after two (2) business days following the City's receipt of the Developer's written notice 13 tenninating this Agreement or date of the City's written notice to Developer tenninating this Agreement. (ii) If the Developer terminates this Agreement, the Developer's remedies are limited to terminating this Agreement, enforcing its rights under Section 10 hereof and under the Guaranty, recovering from the City the Developer Reimbursable Costs, collecting any earnest money as provided in Sections IO(c), (d), (e) and (f), and collecting all out-of-pocket costs incurred by the Developer, including reasonable attorneys fees, for collecting the payment to Developer of the earnest money which has been received by the City; provided that if Developer terminates the Agreement because of rescission of the OTP initiated by Developer under Section 10(b) hereof, Developer's rights to receive Developer Reimbursable Costs are qualified by the provisions of Section 5(f)(3) hereof. (iii) If the City terminates this Agreement, then the City's sole remedies shall be to terminate this Agreement and to recover any unpaid City Reimbursable Costs, and all of the out-of-pocket costs incurred by the City in collecting the City Reimbursable Costs, including reasonable attorneys fees. The City shall remain obligated to pay the Developer the Developer Reimbursable Costs pursuant to Section 5, to terminate the OTP pursuant to Section 10, to recover the earnest money and pay the same to the Developer pursuant to Sections 10(c), (d), (e) and (f) and as otherwise provided in this Agreement. The Developer Reimbursable Costs and earnest money due Developer are subject to a right of offset for arnounts due by the Developer to the City for unpaid City Reimbursable Costs. (c) Notwithstanding any other provision of this Agreement to the contrary, the terms and conditions of Section 4(c)(iv), Section 5, and Sections lO(c), (d), (e) and (f) and Section I2(b) survive the expiration or earlier termination of this Agreement. Section 13. Severability. If any portion of this Agreement is held invalid by a court of competent jurisdiction, such decision shall not affect the validity of any remaining portion of this Agreement. Section 14. Notices. Notice or demand or other communication between or among the parties shall be sufficiently given if sent by mail, postage prepaid, return receipt requested or delivered personally: (a) As to the City: City of Arden Hills 11245 W. Highway 96 Arden Hills, MN 55112 Attn: City Administrator With a copy to: Stephen J. Bubul Kennedy & Graven, Chartered 470 U.s. Bank Plaza 14 200 South Sixth Street Minneapolis, MN 55402 (b) As to the Developer: CRR, LLC c/o Ryan Companies US, Inc. 50 South Tenth Street, Suite 300 Minneapolis, MN 55403 Attn: Rick Collins With a copy to: Charles F. Diessner Fredrikson & Byron, P.A. 200 South Sixth Street, Suite 4000 Minneapolis, MN 55402 Section 15. Counterparts. This Agreement may be executed simultaneously In any number of counterparts, all of which shall constitute one and the same instrument. Section 16. Waivers. In the event any agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. Section 17. Titles of Sections. Any titles of the Sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 18. Relationship of Parties. Nothing in this Agreement creates a joint venture, partnership or principal-agent relationship between the parties. Section 19. Effective Laws. This Agreement shall be construed in accordance with the laws of Minnesota, and any disputes shall be adjudicated in Ramsey County district courts. Section 20. all respects. Effect of Agreement. This Agreement supersedes the Interim Agreement in Section 21. Conflict. In the event of any conflict between the terms and conditions of this Agreement and the Guaranty, the terms and conditions of this Agreement shall govern and controL Section 22. References to GSA. All references to the GSA in this Agreement shall also be deemed to be references the United States Government and/or the U.S. Army, as circumstances reqUIre. Section 23. Dispute Resolution. Upon written notice from either party to the other prior to the commencement of any legal action, or within ten (10) business days after the commencement of any legal action relating to any claims, disputes or other matters in question between the parties 15 to this Agreement arising out of or relating to Section 5 (excluding 5( f)(2)) of this Agreement, shall be referred to nonbinding mediation before, and as a condition precedent to, proceeding with any legal action regarding such claims, disputes or other matters other than the commencement of such action. Each party agrees to participate in up to eight (8) hours of mediation which must be completed and any agreed upon resolution duly executed within thirty (30) days after written notice requiring nonbinding mediation. The mediator shall be selected by the parties, or if the parties are unable to agree on a mediator then any party can request the administrator of the Ramsey County District Court Civil ADR Program and/or similar person, to select a person from its list of qualified neutrals. The mediation shall be decided by employees or agents of each party having authority to settle the dispute. All fees and expenses of the mediator shall be shared equally between the parties and all other expenses incurred by each party related to the mediation shall be borne by such party, including without limitation, the costs of any experts or legal counsel. All applicable time periods for responding to any legal action which has been commenced, statutes of limitations and all defenses based on the passage of time are tolled while the mediation procedures are pending, and for a period of 30 days thereafter. [Signatures on following pages] 16 IN WITNESS WHEREOF, the City has caused this Agreement to be duly executed in its name and behalf and the Developer has caused this Agreement to be duly executed in its name and behalf on or as of the date first above written. CITY OF ARDEN HILLS By Its Mayor By Its City Administrator eRR, LLC By Its 299882vll $18 ]7 EXHIBIT A DEVELOPMENT PROPERTY [Insert survey] A-I EXHIBIT B FRAMEWORK VISION [Insert Framework Vision map] B-1 EXHIBIT C PRIOR CITY REIMBURSABLE COSTS - I .. .g> " i III - i .. ~ - to ~ to U) 0 0 <:> <:> t- O 0 '" 0 0 0 .... t- <:> ~ 0 <0 to .... to 0 0 0 0 0 0 li <t) <0 0 ~ '" 0 0 .... .... 0 0 <'l 0 <'l 0 <0 '" q "'.'" '" t- O! "! "! q q to to "< r-: cD w ci w ci cD cD ci ci M <D <D ci W -, - ci r-: N N '" "".... to 0 '" ~ .... 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(<') ..,fY}c5~ "" ~ "" to ..... 00 o C) "'''' lO~ ~~ ~ ~ ~ ItO to to 1.0 10000 0000 NNNN IlOMCOca 1T"""..........'r' M~~iO I i :J::>::J:> cncnr.nCl) 0000 lIJ lIJ Cl> () e I"- o . (Q .... . N I- u.. ~ o <'". o EXHIBIT D BUDGET OF CITY REIMBURSABLE COSTS Consultant Scone of Services Budl'et SRF (Environmental Srvcs) . AUAR Environmental Study $250,000 . Preparation of AUAR process schedule . Initialize EA W with unique AUARitelllS . Establishment of Public Involvement Process . Assemble elements of the AUAR . Author fmal docwnent . Meetings . Review of environmental documents as needed Spencer Fane Britt & Browne . Legal Services relating to the $150,000 Mike Comodeca (Legal Services) Transfer Process . Offer To Purchase . Review of Transfer Documents . Negotiations with GSA and Army . Meetings & Travel Kennedy & Graven . Negotiation and Preparation of $150,000 Stephen Bubul (Legal Services) Development Agreements . Review of Legal documents as needed . TIF related legal review . Meetings BCS Consulting Services . Project Management Consulting $75,000 Deunis Welsh (Project Management . Review of documents as needed Services) . Project assistance as needed . Council education . Grant Assistance . Meetings Engineering Services . Engineering review and $40,000 consultation Ehlers & Associates . Provide fiscal analysis of $150,000 (Financial Consultant Services) develooment agreements D-I Consultant Scone of Services Bud<>d . Review of Developer Pro forma . Evaluate fiscal and economic implications of land transfer particularily with regard to infrastructure and city services . Develop a Resource Plan for the City of Arden Hills . Provide overall project assistance as required . meetings LHB (TIF Inspections Services) . Inspection services related to $40,000 development of one or more TIF Districts Peterson Frarn Bergman . Review documents and provide $25,000 Jerry Filla (City Attorney) legal opinions as necessary Additional City Staff . Assist with planning and $75,000 Planning Assistant community development activities to allow CD DITector~roject~anager and City Planner to devote additional time to TeAAP Project MISe. . Legal Notices $25,000 . Mailings . PR/ Advertising . Office supplies/Equipment . StaffTraveVfraining D-2 EXHIBIT E DEVELOPER REIMBURSABLE COSTS Developer Reimbursable Costs are the City Reimbursable Costs and the out-of-pocket costs paid by the Developer for the following activities, subject to the terms and conditions described below: 1. Framework Vision 2. Environmental studies of the Development Property 3. Geotechnical studies of the Development Property 4. Traffic Analysis~Related to infrastructure outside the Development Property only 5. AUAR process and documents related to Development Property 6. Amendments to City Comprehensive Plan related to Development Property 7. Landscape plans and design guidelines for Development Property 8. Development District and TIF District(s) and related plans for all or portion of the Development Property The Developer Reimbursable Costs related to any of the foregoing activities qualifY as a Developer Reimbursable Cost only if the Successor Developer uses such relevant item. The portion of the Developer Reimbursable Costs due the Developer in each category wi!! be the portion of actual Developer Reimbursable Costs that are detennined by a City-appointed "independent expert" in the relevant field to have value for the Successor Developer. If Developer disagrees with the City's expert, Developer may (within 30 days after receipt of the City's expert opinion) request an opinion from an independent expert selected by Developer. If the expert opinions differ, the two experts will mutually agree upon a third independent expert who shall determine the process to be followed and whose conclusion as to the amount of Developer Reimbursable Costs for that item that are due the Developer will be binding on the parties. For the purposes of this Exhibit E, the term "independent expert" for the City-appointed or Developer appointed independent expert means a person or entity who (i) has reasonable professional experience in the area that is the subject of the opinion; (ii) does not have any material financial interest in the City, the Developer, Rehbein, Ryan or the transaction to which such person's opinion relates (other than payment to be received for professional services rendered as a consultant to the Developer or City, including regarding the Development, or as an "expert" under this Exhibit E and (iii) is not connected with the City, the Developer, Rehbein or Ryan as an officer, director or employee. E-I FIRST AMENDMENT TO FUNDING AND GUARANTY AGREEMENT This First Amendment to the Funding and Guaranty Agreement ("First Amendment") is entered into as of the day of ,2007, by and between the City of Arden Hills, a Minnesota municipal corporation (the "City"), CRR, LLC, a Delaware limited liability company (the "Developer"), Ryan Companies US, Inc., a Minnesota corporation ("Ryan") and Rehbein Companies, Inc. ("Rehbein"). RECITALS A The City and the u.s. Government entered into an Offer to Purchase dated August 1, 2006, as amended on August 11,2006, November 15, 2006 and January 22, 2007 (the "OTP"). B. The City, Developer, Ryan and Rehbein entered into that certain Funding and Guaranty Agreement dated August 10, 2006 (the "Guaranty"). C. The City and Developer desire to enter into a Preliminary Development Agreement (the "PDA") regarding the redevelopment of the property described in the OTP (the "Property") and a condition of the Developer executing the PDA is that the parties enter into this First Amendment. D. The City, Developer, Ryan and Rehbein desire to amend the Guaranty as provided in this First Amendment E. Guaranty. Defined terms not otherwise defined herein shall be defined as set forth in the NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree that the Guaranty is amended as follows: I. Paragraph 3.0C of the Guaranty is deleted in its entirety and substitoted therefore is the following: In the event that the OTP is executed, submitted and not thereafter rescinded pursuant to its terms and the GSA conveys the Property to the City pursuant to the OTP, CRR agrees to fund the purchase price and other amounts due by the City to the GSA, excluding the earnest money, as required pursuant to the terms and conditions of the OTP (the "Purchase Price"). In this regard, the City agrees to (i) tender the Purchase Price to the U.S. Government upon receipt of a wire-transfer of funds in like amount to the City of Arden Hills' bank account and (ii) simultaneously convey the Property to CRR pursuant to the terms of a master development agreement to be entered into between CRR and the City. 304669v2 SJB AR200-4 1 2. Paragraph 3.0H is deleted in its entirety and substituted therefore is the following: Rehbein and Ryan, for themselves, their successors and assigns, hereby IDlconditionally, jointly and severally guaranty of the obligations of CRR to fund the earnest money and the Purchase Price as provided in paragraphs 3.0B and 3.0C, respectively. 3. and effect. Except as set forth herein, the Guaranty shall remaiu unmodified and in full force IN WI1NESS WHEREOF, the parties have executed this First Amendment effective as of the day and year first above written. CITY OF ARDEN HILLS By: Name: Its: CRR, LLC By: Name: Its: RYAN COMPANIES US, INe. By: Name: Its: REHBEIN COMPANIES, INC. By: Name: Its: 4138368_2.DOC 012307 304669v2 SJB AR2004 2 - ! .. . ~ , " I III ! - I .a (!. t - to ~ ." '" 0 0 0 0 t- O 0 0> 0 0 0 .... t- O ,10 '" U) .... co 0 0 0 0 0 0 !i U) '" C! ~ <"> 0 C! .... .... 0 0 ~ 0 ~ 0 "! 0> C! "'.'" ": t- O! "! "! C! C! U) "! 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AUAR Environmental Study $250,000 . Preparation of AUAR process schedule . Initialize EA W with unique AUAR items . Establishment of Public Involvement Process . Assemble elements of the AUAR . Author fmal document . Meetings . Review of environmental documents as needed Spencer Fane Britt & Browne . Legal Services relating to the $150,000 Mike Comodeca (Legal Services) Transfer Process . Offer To Pwchase . Review of Transfer Documents . Negotiations with GSA and Army . Meetings & Travel Kennedy & Graven . Negotiation and Preparation of $150,000 Stephen Bubul (Legal Services) Development Agreements . Review of Legal documents as needed . TIF related legal review . Meetings BeS Consulting Services . Project Management Consulting $75,000 Dennis Welsh (Project Management . Review of documents as needed Services) . Project assistance as needed . Council education . Grant Assistance . Meetings Engineering Services . Engineering review and $40,000 consultation Ehlers & Associates . Provide fiscal analysis of $150,000 (Financial Consultant Services) development agreements 0-1 Consultant Scone of Services Bud..et . Review of Developer Pro fonna . Evaluate fiscal and economic implications ofland tcansfer particulari1y with regard to infrastructure and city selVlces . Develop a Resource Plan for the City of Arden Hills . Provide overall project assistance as required . meetings LHB (TIF Inspections Services) . Inspection services related to $40,000 development of one or more TIF Districts Peterson Fram Bergman . Review documents and provide $25,000 Jerry Filla (City Attorney) legal opinions as necessary Additional City Staff . Assist with planning and $75,000 Planning Assistant community development activities to allow CD Direclor/Project Manager and City Planner to devote additional time to TCAAP Project MISe. . Legal Notices $25,000 . Mailings . PRI Advertising . Office supplies/Equipment I . StaffT raveVf raining D-2 EXHIBIT E DEVELOPER REIMBURSABLE COSTS Developer Reimbursable Costs are the Cily Reimbursable Costs and the ou1-of-pocket costs paid by the Developer for the following activities, subject to the terms and conditions described below: L Framework Vision 2_ Environmental studies oflhe Development Property 3_ Geotechnical studies oflhe Development Property 4_ Traffic Analysis-Related to infrastructure outside the Development Property only 5_ AUAR process and documents related to Development Property 6. Amendments to City Comprehensive Plan related to Development Property 7. Landscape plans and design guidelines for Development Property 8. Development Districl and TlF District(s) and related plans for all or portion of the Development Property The Developer Reimbursable Cosls related to any of the foregoing activities qualify as a Developer Reimbursable Cost only if the Successor Developer uses such relevant item. The portion of the Developer Reimbursable Costs due the Developer in each category will be the portion of actual Developer Reimbursable Costs thai are de1ennined by a City-appointed "independent expert" in the relevant field to have value for the Successor Developer. If Developer disagrees with the City's expert, Developer may (within 30 days after receipt of the City's expert opinion) request an opinion from an independent expert selected by Developer. If lhe expert opinions differ, the two experts will mutually agree upon a third independen1 expert who shall determine the process to be followed and whose conclusion as to the amount of Developer Reimbursable Costs for that item that are due the Developer will be binding on the parties. For the purposes of this Exhibit E, the tenn "independent expert" for lhe City-appointed or Developer appointed independent expert means a person or enlity who (i) has reasonable professional experience in the area that is the subject of the opinion; (ii) does not have any material financial interest in the City, the Developer, Rehbein, Ryan or the transaction to which such person' s opinion relates (other than payment to be received for professional services rendered as a consultant to Ihe Developer or City, including regarding the Development, or as an "expert" under lhis Exhibi1 E and (iii) is not connected with the City, the Developer, Rehbein or Ryan as an officer, director or employee. E-I FIRST AMENDMENT TO FUNDING AND GUARANTY AGREEMENT This First Amendment to the Funding and Guaranty Agreement ("First Amendment") is entered into as of the day of , 2007, by and between the City of Arden Hills, a Minnesota municipal corporation (the "City"), CRR, LLC, a Delaware limited liability company (the "Developer"), Ryan Companies US, Inc., a Minnesota corporation ("Ryan") and Rehbein Companies, Inc. ("Rehbein"). RECITALS A. The City and the U.S. Government entered into an Offer to Purchase dated August I, 2006, as amended on August 11,2006, November 15,2006 and January 22, 2007 (the "OTP"). B. The City, Developer, Ryan and Rehbein entered into that certain Funding and Guaranty Agreement dated August 10, 2006 (the "Guaranty"). C. The City and Developer desire to enter into a Preliminary Development Agreement (the "PDA") regarding the redevelopment of the property described in the OTP (the "Property") and a condition of the Developer executing the PDA is that the parties enter into this First Amendment D. The City, Developer, Ryan and Rehbein desire to amend the Guaranty as provided in this First Amendment E. Guaranty. Defined terms not otherwise defined herein shall be defined as set forth in the NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree that the Guaranty is amended as follows: I. Paragraph 3.0C of the Guaranty is deleted in its entirety and substituted therefore is the following: In the event that the OTP is executed, submitted and not thereafter rescinded pursuant to its terms and the GSA conveys the Property to the City pursuant to the OTP, CRR agrees to fund the purchase price and other amounts due by the City to the GSA, excluding the earnest money, as required pursuant to the terms and conditions of the OTP (the "Purchase Price"). In this regard, the City agrees to (i) tender the Purchase Price to the U.S. Government upon receipt of a wire-transfer of funds in like amount to the City of Arden Hills' bank account and (ii) simultaneously convey the Property to CRR pursuant to the terms of a master development agreement to be entered into between CRR and the City. 304669v2 SJB AR200-4 I 2. Paragraph 3.0H is deleted in its entirety and substituted therefore is the following: Rehbein and Ryan, for themselves, their successors and assigns, hereby tnlconditionally, jointly and severally guaranty of the obligations of CRR to fund the earnest money and the Purchase Price as provided in paragraphs 3.0B and 3.0C, respectively. 3. and effect. Except as set forth herein, the Guaranty shall remain unmodified and in full force IN WITNESS WHEREOF, the parties have executed this First Amendment effective as of the day and year lust above written. CITY OF ARDEN IDLLS By: Name: Its: CRR, LLC By: Name: Its: RYAN COMPANIES US, INe. By: Name: Its: REHBEIN COMPANIES, INe. By: Name: Its: 4138368_2.DOC 012307 304669v2 SJB AR2OO-4 2