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HomeMy WebLinkAbout5I Chatonka Heights Final Plat 4646 Dakota Street SE Prior Lake, MN 55372 CITY COUNCIL AGENDA REPORT MEETING DATE: AUGUST 22, 2016 AGENDA #: 5I PREPARED BY: PRESENTED BY: JEFF MATZKE, PLANNER JEFF MATZKE AGENDA ITEM: CONSIDER APPROVAL OF A RESOLUTION APPROVING THE CHATONKA HEIGHTS FINAL PLAT AND DEVELOPMENT CONTRACT DISCUSSION: Introduction The purpose of this agenda item is to consider approval of a Final Plat for Cha- tonka Heights as submitted by Hemlock Holdings LLC. The subject property is proposed to be developed as a 22-lot, low density residential subdivision. The site is approximately 9 acres and is located south of Carriage Hills Parkway, north of Beach Street, and east of Bluebird Trail. History The City Council approved the preliminary plat of Chatonka Heights on June 27, 2016. After conducting a public hearing, the Planning Commission recom- mended the plat to the Council. Current Circumstances The development plan calls for a 22 lot single family residential development. Staff has reviewed the final plat and finds it to be in substantial compliance with the approved preliminary plat. Conclusion The platting of this property will allow the construction of 22 lot residential subdi- vision. The City Staff recommends approval of the final plat and the correspond- ing development contract. ISSUES: The principal requirements for final plat approval include an agreement as a De- velopment Contract that specifies the development fees and other requirements for the platted lots. An exhibit to the development agreement details a purchase agreement that will be required between the City and the developer for realign- ment of the storm water ponding area at the southeastern corner of the site. The City will transfer a portion of the existing storm water pond lot to the developer for rear yard areas of the residential lots; and in turn, the developer will transfer a larger portion of the existing private property for expansion of the storm water pond. The developer has submitted a landscape plan that identifies all required tree replacements on site within the private residential lots, boulevards, and storm water pond outlot. It is the intention of the developer to fully place all tree re- placements on site. However, if this is not possible due to future homebuyer preferences or other reasons discovered once the project is developing, it may 2 be necessary for the development agreement to be amended in the future to allow for off-site tree replacement and/or a fee in lieu of replacement. On August 15, the Planning Commission authorized City staff to move forward with a public hearing to consider amending the City’s ordinance to allow this option. Any amendment to the development agreement would require City Council approval. At this writing, the developer has not executed the development contract. If the document is not executed by the time of the city council meeting , staff will re- quest that this item be removed from council consideration until the next regular meeting. FINANCIAL IMPACT: Approval of this final plat will allow construction of a 22 single family residential lots which will contribute to the City’s tax base. ALTERNATIVES: 1. Motion and a second, as part of the Consent Agenda, to approve a resolu- tion approving the Chatonka Heights Final Plat and Development Contract. 2. Remove this item from the consent agenda for additional discussion. RECOMMENDED MOTION: Alternative #1 ATTACHMENTS: 1. Approved Preliminary Plat 2. Final Plat dated August 8, 2016 3. Chatonka Heights Development Contract #16-000005 4646 Dakota Street SE Prior Lake, MN 55372 RESOLUTION 16-XXX A RESOLUTION APPROVING THE CHATONKA HEIGHTS FINAL PLAT AND DEVELOPMENT CONTRACT Motion By: Second By: WHEREAS, Hemlock Holdings LLC (the “Developer”) has submitted an application to the City of Prior Lake for approval of a Final Plat for Chatonka Heights; and WHEREAS, The City Council has found that the final plat of Chatonka Heights is in substantial compliance with the approved preliminary plat of Chatonka Heights. NOW THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE, MINNESOTA as follows: 1. The recitals set forth above are incorporated herein as if fully set forth. 2. The final plat of Chatonka Heights is approved subject to the following conditions, which shall be met by the Developer prior to release of and recording of the final plat: a. A current title opinion or commitment of title insurance is submitted acceptable to the City Attorney. b. Payment of all fees prior to release of the final plat mylars. c. Reductions of the entire final plat be submitted, to the following scales: 1” = 200’; and one reduction at no scale which fits onto an 8 1/2” x 11” sheet of paper. d. Three mylar sets of the final plat with all required signatures are submitted. e. The final plat and all pertinent documents must be filed with Scott County within 60 days from the date of final plat approval. Failure to record the documents by October 21, 2016, will render the final plat null and void. 3. The Mayor and City Manager are hereby authorized to execute the Development Contract as approved by the city attorney on behalf of the City. PASSED AND ADOPTED THIS 22ND DAY OF AUGUST 2016. VOTE Hedberg Keeney McGuire Morton Thompson Aye ☐ ☐ ☐ ☐ ☐ Nay ☐ ☐ ☐ ☐ ☐ Abstain ☐ ☐ ☐ ☐ ☐ Absent ☐ ☐ ☐ ☐ ☐ ______________________________ Frank Boyles, City Manager Page 1 DEVELOPMENT CONTRACT CHATONKA HEIGHTS PROJECT #DEV16-000005 This DEVELOPMENT CONTRACT is entered into this ___ day of _____, 2016, by and between the CITY OF PRIOR LAKE, a Minnesota municipal corporation ("City"), and Hemlock Holdings LLC, a Minnesota Limited Liability Company (“Developer”), and its successors and assigns. Based on the mutual promises and covenants set forth herein, the sufficiency of which is not disputed, the City and the Developer (collectively “Parties”) agree as follows: 1. REQUEST FOR PLAT APPROVAL. The Developer has asked the City to approve a Plat for Chatonka Heights ("Plat"), over land in the City of Prior Lake which is legally described as shown on attached Exhibit A which is incorporated herein as if fully set forth. 2. CONDITIONS OF PLAT APPROVAL. The City hereby approves the Plat on condition that the Developer enter into this Development Contract, furnish the Security required by it, and record the Plat and Development Contract with the County Recorder or Registrar of Titles within 60 days after the City Council approves the final Plat. Page 2 3. RIGHT TO PROCEED. Within the Property, the Developer may not construct sewer lines, water lines, streets, utilities, public or private improvements, or any buildings until all the following conditions have been satisfied: 1) this Development Contract has been fully executed by both parties, 2) the necessary security, development fees and insurance have been received by the City, and 3) the City Engineer or Designee has issued a letter that all conditions have been satisfied and that the Developer may proceed. The foregoing restriction on the Developer’s “Right To Proceed” does not apply to grading or other approvals set forth in Resolution No. 16-083, dated July 27, 2016, approving the preliminary Plat for Chatonka Heights. 4. PHASED DEVELOPMENT. If the Plat is a phase of a multiphased preliminary Plat, the City may refuse to approve final Plats of subsequent phases if the Developer has breached this Development Contract or any terms or conditions set out in the Resolution approving the final Plat and the breach has not been remedied. In addition, no other subsequent phases may proceed until the City approves Development Contracts for such phases. Fees and charges collected by the City in connection with infrastructure, public improvements and parkland dedication requirements are not being imposed on outlots, if any, in the Plat that are designated in an approved preliminary Plat for future subdivision into lots and blocks. Such charges will be calculated and imposed when the outlots are subdivided into lots and blocks. 5. PRELIMINARY PLAT STATUS. If the Plat is a phase of a multiphased preliminary Plat, the Developer shall submit in accordance with City Code a Staging Plan for City Council approval which may allow the Developer more than one (1) year to subdivide the property into lots and blocks. 6. DEVELOPMENT PLANS. The Property shall be developed in accordance with the Plans identified below. The Plans shall be approved by the City Engineer prior to consideration of the final Plat and Developer’s Contract by the City Council. The plans shall not be attached to this Development Contract, but are incorporated by reference and made a part of this Development Contract as if fully set forth herein. If the plans vary from the written terms of this Development Contract, the more specific or stringent controls shall apply. The Plans are: Page 3 Plan A -- Final Plat Dated stamp dated August 8, 2016 (Prepared by Stantec) Plan B -- Final Grading, and Erosion Control Plan(s) as stamped approved by the City Engineer or his designee (Prepared by Stantec) Plan C -- One set of Plans and Specifications for Developer Installed Improvements Stamp Dated as stamped approved by the City Engineer or his designee (Prepared by Stantec) Plan D -- Landscape Plan as stamped approved by the City Planner or his designee (Prepared by Stantec) All plans set forth above are incorporated herein and made part of this Development Contract. 7. DEVELOPER INSTALLED IMPROVEMENTS. The Developer shall install and pay for the following: A. Sanitary Sewer System B. Water System C. Storm Sewer D. Streets E. Concrete Curb and Gutter F. Street Lights G. Site Grading and Ponding H. Underground Utilities I. Traffic Control Signs J. Street Signs K. Setting of Iron Monuments L. Sidewalks, Trails, and Boardwalks M. Landscaping N. Wetland Buffer Signage The Developer Installed Improvements shall be installed in accordance with the City’s Subdivision Ordinance, City standard specifications for utilities and street construction, the City's Public Works Design Manual (“PWDM”), and any other applicable City ordinances, all of which are incorporated herein by reference. The Developer shall submit plans and specifications, which have been prepared by a Minnesota registered professional civil engineer to the City for approval by the City Engineer. The Developer shall Page 4 obtain all necessary permits and approvals from any other agencies having jurisdiction before proceeding with that aspect of the construction as it relates to that permit. The Developer, its contractors and subcontractors, shall follow all instructions received from the City's authorized personnel. The Developer or the Developer’s engineer shall schedule a preconstruction meeting with all parties concerned, including the City staff, to review the program for the construction work. In accordance with Minnesota Pipeline Safety law revisions effective January 1, 2006 the Developer will be responsible for installing a tracer wire mechanism for all service lines in public right-of-way. The proposed tracer mechanism shall be approved by the City prior to installation. All costs associated with furnishing and installing the tracers shall be the Developer’s responsibility. Before the Security for the completion of utilities is released, iron monuments must be installed in accordance with Minn. Stat. §505.02. The Developer's surveyor shall submit a written notice to the City certifying that the monuments have been installed. 8. CONSTRUCTION OBSERVATION. The City’s authorized personnel shall provide construction observation during the installation of the Developer Installed Improvements in accordance with the PWDM. These services by the City shall include: A. Construction observation during installation of required Developer Installed Improvements, which include grading, sanitary sewer, watermain, storm sewer/ponding and street system. B. Documentation of construction work and all testing of Developer Installed Improvements. C. Field document as-built location dimensions for sanitary sewer, watermain and storm sewer facilities. The Developer’s Engineer is responsible for data collection and preparation of as-built record plans. 9. DEVELOPER PROVIDED CONSTRUCTION SERVICES. The Developer shall be responsible for providing all other construction services including, but not limited to: A. Construction surveying Page 5 B. As-built drawings of grading plans. C. As-built drawings showing location, dimensions and elevations of all utility improvements, including but not limited to top nut of hydrants, manhole rims, manhole inverts. (Field tie dimensions to sewer and water services shall be provided to the Developer’s Engineer, by City staff or City consultants). As-built record drawings shall follow the requirements set forth in the PWDM. The as-built record drawings shall be submitted to the City for approval within six (6) months of substantial base pavement course placement. D. Project Testing: The Developer is responsible, at the Developer’s sole cost, to provide testing to certify that Developer Installed Improvements were completed in compliance with the approved final plans and specifications. The personnel performing the testing shall be certified by the Minnesota Department of Transportation. The City Engineer has the sole discretion to determine if additional testing is necessary. The cost of additional testing is to be paid by the Developer. E. Lot corners and monuments. F. Engineering / Project Management 10. BOULEVARD AND AREA RESTORATION. The Developer shall seed or lay cultured sod in all boulevards within thirty (30) days, or within a timeline established by the City Engineer, of the completion of street related improvements, weather permitting, and restore all other areas disturbed by the development grading operation. Boulevard and Area Restoration shall be in accordance with the approved erosion control plan. Upon request of the City Engineer, the Developer shall remove the silt fences after turf establishment. 11. SUBDIVISION MONUMENTS. The Developer shall install all subdivision monumentation within one (1) year from the date of recording the Plat, or the monumentation shall be installed on a per lot basis at the time the building permit for the subject lot is issued, whichever occurs first. At the end of the one Page 6 (1) year period from recording of the Plat, the Developer shall submit to the City Engineer written verification by a registered land surveyor that the required monuments have been installed throughout the Property. 12. TIME OF PERFORMANCE. The Developer shall install all required public improvements by December 31, 2017, with the exception of the final wear course of asphalt on streets. The final wear course on streets shall be installed by July 30th, of the first summer after the base layer of asphalt has been in place for one freeze-thaw cycle. If necessary, the Developer and the City shall consult about an extension of time. If an extension is granted, it shall be in writing and conditioned upon updating the Security posted by the Developer to reflect cost increases and the extended completion date. 13. LICENSE. The Developer hereby grants the City, its agents, employees, officers and contractors a non-revocable license to enter the Property to perform all work and inspections deemed appropriate by the City in conjunction with the development of the Property. 14. EROSION CONTROL. A. Prior to initiating site grading, the erosion control plan, Plan B, and Stormwater Pollution Prevention Plan (SWPPP) shall be implemented by the Developer and inspected and approved by the City. The City may require the Developer, at no cost to the City, to install additional erosion control measures if they are necessary to meet erosion control objectives. All areas disturbed shall be reseeded immediately after the completion of the work in that area. All seeded areas shall be mulched, and disc anchored as necessary for seed retention. The parties recognize that time is of the essence in controlling erosion. If the Developer does not comply with the erosion control plan and schedule or supplementary condit ions imposed by the City, the City may take such action as it deems appropriate to control erosion. The City will endeavor to notify the Developer in advance of any proposed action, but failure of the City to do so will not affect the Developer's and City's rights or obligations hereunder. The Developer shall be solely responsible for any costs incurred by the City for erosion control measures. The Developer shall fully reimburse the City for any cost incurred within ten (10) days of the date of the City’s invoice. If the Page 7 Developer does not reimburse the City for any cost the City incurred for such work within ten (10) days, the City may, without further notice to the Developer, draw down the Irrevocable Letter of Credit to pay any costs. No development, utility or street construction will be allowed unless the P roperty is in full compliance with the erosion control requirements. The notice provisions set out in Paragraph 40 shall not apply to notifications to the Developer under this paragraph. B. The Developer shall seed or lay cultured sod in all boulevard areas behind curb within thirty (30) days, or within a timeline established by the City Engineer, of the completion of street related improvements, weather permitting (sod does not need to be installed in areas of buildable lots where silt fence is required behind curbs). C. The Developer shall restore all other areas disturbed by the development grading and construction operations within this time period. D. Boulevard and disturbed area restoration shall be in accordance with the approved Plan B and SWPPP. (No building permits will be issued until the Developer has installed silt-fence behind the curb of all buildable lots). It is expressly understood that once silt fence has been installed it shall become the builders’ responsibility to maintain the silt fence. 15. CLEAN UP. The Developer shall clean dirt and debris from streets that has resulted from any and all construction work by the Developer, homebuilders, contractors and subcontractors, their agents or assigns. Prior to any construction on the Property, the Developer shall identify, in writing, a responsible party and schedule for erosion control, street cleaning, and street sweeping. If the Developer fails to perform the required clean-up within 24 hours of receiving instructions and notice from the City, the City, without further notice, will perform the work and charge the associated cost to the Developer. If the Developer does not reimburse the City for any cost the City incurred for such work within ten (10) days of receipt of the invoice, the City may draw down, without further notice, the Irrevocable Letter of Credit to pay any costs Page 8 incurred by the City. Due to time sensitive nature of clean up, the notice provisions set out in Paragraph 40 shall not apply to notifications to the Developer under this paragraph. 16. GRADING PLAN. A. The Property shall be graded in accordance with the approved grading plans. All existing and proposed contours must be shown and approved as a part of the building permit application. The grading plans, as well as the grading and erosion control work shall conform to PWDM. B. As-builts. Before the City releases the Security, the Developer shall provide the City with an as built grading plan and a certification by a registered land surveyor or engineer that all ponds, swales, and ditches have been constructed on public easements or land owned by the City. The as-built plan shall include field verified elevations of the following: a) cross sections of ponds, b) location and elevations along all swales and ditches, and c) lot corners and house pads. The City may withhold issuance of building permits until the approved certified grading plan is on file with the City and all erosion control measures are in place as determined by the City Engineer. The Developer shall also submit a land tabulation certified by a registered engineer showing that all pads have been corrected in accordance with project specifications. 17. OWNERSHIP OF DEVELOPER INSTALLED IMPROVEMENTS. Upon (1) completion of the Developer Installed Improvements required by this Development Contract; (2) final written acceptance by the City Engineer; and (3) adoption of a resolution of acceptance by City Council, the improvements lying within public right-of-way and easements shall become City property. The Developer shall be responsible for all pond maintenance until written acceptance by the City of the Developer Installed Improvements. 18. STREET MAINTENANCE. Developer shall be responsible for all street maintenance until final written acceptance by the City of the Developer Installed Improvements. Warning signs and detour signs, if determined to be necessary by the City Engineer, shall be placed when hazards develop in streets to prevent the public from traveling on same and directing attention to detours. If and when streets become Page 9 impassable, such streets shall be barricaded and closed. For the purpose of this subparagraph, “street maintenance” does not include snow plowing or normal sweeping. 19. CONSTRUCTION ACCESS. Construction traffic access and egress for grading, public utility construction, and street construction is restricted to Carriage Hills Parkway, Bluebird Trail, Dove Court, and Raven Court as permitted. No construction traffic is permitted on other adjacent local streets. 20. IMPROVEMENTS REQUIRED BEFORE ISSUANCE OF BUILDING PERMITS. A. Grading, utilities, curbing, and one lift of bituminous shall be installed on all streets providing access and adjacent to a lot prior to issuance of any building permits for that lot. Grading as-builts for the proposed building permit shall be approved prior to issuance of any building permit. Before a building permit will be issued a minimum of one (1) active fire hydrant within 300 feet of the unit must be available for fire protection. If building permits are issued prior to the acceptance of Developer Installed Improvements, the Developer assumes all liability and costs incurred as a result of delays in completion of the Developer Installed Improvements; including damages to Developer Installed Improvements caused by the Developer, its contractors, subcontractors, material men, employees, agents or third parties. B. Wetland Buffer Signage must be installed prior to the issuance of any building permits within the Property. C. A temporary or permanent Certificate of Occupancy shall not be issued for any building on the Property until water and sanitary sewer improvements have been installed and the streets have been completed and the first lift of bituminous has been placed and said improvements have been inspected and determined by the City to be available for use. D. Notwithstanding any other provision of this Contract, the City will issue a building permit for up to two (2) model homes and a temporary parking lot upon Developer’s compliance with the following requirements: (1) approval of the building plans by the Building Official; (2) approval of a site survey for the model home(s) and parking lot(s) by the City Planner, and (3) presence of a paved street within Page 10 300 feet of a model home and presence on said paved street of a fire hydrant within 1,000 feet of a model home and approval by the Fire Chief. 21. CITY ADMINISTRATION. The Developer shall pay a fee for City administration. City administration will include all activities necessary to implement this Development Contract. These activities include, but are not limited to, preparation of the Development Contract, consultation with Developer and its engineer on the status of or problems regarding the development of the Plat and/or Property, project monitoring during the warranty period, processing of requests for reduction in security, and any consulting or legal fees incurred by the City. Fees for this service shall be four percent (4%) of the estimated construction cost as detailed in Exhibit E (minus grading and landscaping), plus tree preservation and replacement costs, less oversizing costs outlined in Exhibit D, assuming normal construction and project scheduling. The previous escrowed funds currently retained by the City as a result of a Preliminary Plat Application will be credited towards the City administration four percent (4%) fee. ADMINISTRATIVE FEE: 4% of estimated construction cost $ 27,005.00 Plus tree preservation and replacement $ 0.00 Less oversizing costs $ -0.00 Less funds previously escrowed $ -10,000.00 TOTAL ADMINISTRATIVE FEE DUE $ 17,005.00 Costs incurred by the City over and above the four percent (4%) administration fee shall be billed to the Developer. 22. REIMBURSEMENT OF CITY ADMINISTRATION FEES. The City and Developer acknowledge that the calculation of the City administration fee is based on construction cost estimates provided by the Developer to the City. Although the City reviews and accepts the construction cost estimates Page 11 provided by the Developer, the review and acceptance is based on an assessment by City Engineering Staff that the costs provided to the City are reasonable. Actual construction costs may vary. 23. CITY CONSTRUCTION OBSERVATION. Construction observation shall include, but is not limited to, part or full-time inspection of proposed grading, public utilities and street construction, City legal costs, and City consultant expenses. In addition to the 4% administration fee, the Developer shall deposit an amount equal to five percent (5%) of the estimated construction cost, less oversizing costs outlined in Exhibit D, for construction observation performed by the City's authorized personnel and incurred pass- through legal expenses. This amount shall be maintained by the City in escrow until final acceptance of all Developer Installed Improvements by the City. Any balance remaining in the escrow account will be returned to the Developer at that time. Costs incurred by the City over and above the five percent (5%) construction observation fee shall be billed to the Developer. 24. TRUNK STORMWATER ACREAGE CHARGE. The Developer shall pay a storm water management fee of $25,510.00 prior to the City signing the final Plat. The amount was calculated as follows: 8.312 acres x $3,069.00 per acre. This charge was determined by the Fee Study adopted by City Council Resolution #15-195 on December 21, 2015. 25. TRUNK WATER ACREAGE CHARGE. A trunk water acreage charge of $55,624.00 shall be paid by the Developer for watermain trunk improvements prior to the City signing the final Plat. The amount was calculated as follows: 8.312 acres at $6,692.00 per acre. This calculation was determined by the Fee Determination Study adopted by City Council Resolution #15-195 on December 21, 2015. 26. TRUNK SEWER ACREAGE CHARGE. A trunk sewer acreage charge of $27,795.00 shall be paid by the Developer for sanitary sewer trunk improvements prior to the City signing the final Plat. The amount was calculated as follows: 8.312 acres at $3,344.00 per acre. This calculation was determined by the Fee Determination Study adopted by City Council Resolution #15-195 on December 21, 2015. Page 12 27. STREET OVERSIZE ACREAGE CHARGE. The Developer shall pay a street oversize acreage charge of $44,985.00 for street oversizing improvements prior to the City signing the final Plat. The amount was calculated as follows: 8.312 acres at $5,412.00 per acres. This charge was determined by the Fee Study adopted by City Council Resolution #15-195 on December 21, 2015. 28. UTILITY CONNECTION CHARGE. The Developer shall pay a utility connection charge of $18,000.00 for connection to the sanitary sewer and water systems. 29. PARK AND TRAIL DEDICATION. The Developer shall pay a park and trail dedication fee of $82,500.00 prior to the City signing the final Plat. The amount was calculated as follows: 22 units at $3,750.00 per unit (Residential). This calculation was determined by the Park Fee Study adopted by City Council Resolution #05-18 on January 18, 2005. 30. STREET LIGHTS AND OPERATIONAL COSTS. The Developer is responsible for contracting with the private electric utility company for the installation of the street lighting. The Developer shall pay the full capital cost of every light to be installed; this includes poles, fixtures, underground wiring, and all appurtenant work. The Developer shall pay a fee equal to the estimated costs of operation and maintenance of the streetlights for three (3) years from installation. This fee has been set at $1,200 based on $100 per pole each year. The street light plan must be acceptable to the City Engineer and in accordance with the PWDM. 31(a). LANDSCAPING (Single-Family Residential). In accordance with the City Subdivision Ordinance, each residential lot on the Property must have at least two (2) front yard trees. The City shall not issue a building permit for a lot until two (2) front yard trees are planted or retained and a cash escrow or letter of credit for the lot in question’s landscaping is provided to the City. The City shall not issue a certificate of occupancy for a lot until the front yard, boulevard, and side yards to the rear of every structure have been sodded, weather permitting. If the required landscaping is not installed, the City is granted a right of entry to enter upon the lot and install the landscaping using the escrowed funds or letter of credit. Upon satisfactory Page 13 completion of the landscaping on the lot, the escrowed funds less any draw made by the City, shall be returned to the person who deposited the funds with the City. 31(b). LANDSCAPING (Special Provisions). Landscaping for the Property shall comply with Plan C. Developer shall warrant all required trees, whether the trees are to be retained or planted, for two (2) years from the later of: (i) the planting of the tree; or (ii) the issuance of a certificate of occupancy to the lot upon which the tree is located. A tree replaced under this warranty shall be warranted an additional two (2) years from the date of the planting of the replaced tree. In additional to all other security required under this Development Contract, Developer shall provide to the City a cash escrow or letter of credit in the amount of $258,272.00 ($206,617.50 x 1.25) to secure the planting and retainage of the required trees and to secure this warranty. If Developer fails to plant or retain the required trees or fails to comply with this warranty, the City may draw upon the escrowed funds or letter of credit to plant or replace required trees. Developer may periodically request reductions of the escrowed funds or letter of credit and the City may approve such a request in an amount of the value of each healthy tree for which the warranty has expired as determined by the City. No tree plantings shall be placed within five (5) feet of a sanitary sewer, storm sewer, or watermain line. All plantings in boulevard areas shall be placed a minimum four (4) feet behind the curb, be of deciduous species (no coniferous species), and be located outside of a fifty (50) foot sight triangle at street corners. 32. SECURITY. To guarantee compliance with the terms of this Development Contract, payment of the costs of all Developer Installed Improvements, and construction of all Developer Installed Improvements, the Developer shall furnish the City with an Irrevocable Letter of Credit in an amount equal to 125% of the estimated Developer Improvement Costs (“Security”). The Security shall be in the form attached hereto as Exhibit B, from a bank, in the amount of $1,102,181.00. The amount of the Security was calculated as follows: Page 14 DEVELOPER INSTALLED IMPROVEMENTS COSTS: Sanitary Sewer $ 125,388.00 Watermain $ 139,194.00 Storm Sewer $ 133,578.50 Streets $ 276,967.00 Grading (shown in Section 33, Fees related to grading permit) $ - Landscaping (does not apply to the 4% / 5% fees) $ 206,617.50 ESTIMATED DEVELOPER INSTALLED IMPROVEMENTS SUBTOTAL $ 881,745.00 X 1.25 TOTAL FOR IRREVOCABLE LETTER OF CREDIT AMOUNT $ 1,102,181.00 This breakdown is for historical reference; it is not a restriction on the use of the Security. The bank on which the Security is drawn shall be subject to the approval of the City. The bank shall be authorized to do business in the State of Minnesota with a principal branch located within the seven County Twin City Metropolitan area. The Security shall extend through the required warranty period. Individual Security instruments may be for shorter terms provided they are replaced at least thirty (30) days prior to their expiration. If the required Developer Installed Improvements are not completed at least thirty (30) days prior to the expiration of the Security, the City may draw it down. If the Security is drawn down, the proceeds shall be used to cure the default. The Security may be drawn down in the event that at least thirty (30) days prior to an identified expiry date the Security is not extended for a period of at least one year or has not been replaced with a substitute Security acceptable to the City. 33. CITY DEVELOPMENT FEES. The Developer shall also furnish the City with a cash fee of $327,225.00 for City Development Fees. The amount of the cash fee was calculated as follows: Page 15 CITY DEVELOPMENT FEES: City Administration Fee (4%) ($10,000 previously paid) $ 17,005.00 City Construction Observation (5%) $ 33,756.00 Trunk Storm Water Acreage Charge $ 25,510.00 Trunk Water Acreage Charge $ 55,624.00 Trunk Sewer Acreage Charge $ 27,795.00 Street Oversize Acreage Charge $ 44,985.00 Utility Connection Charge $ 18,000.00 Park and Trail Dedication Fee (if in lieu of land) $ 82,500.00 Street Light Fee $ 1,200.00 Grading Permit ($2,000 x 9.0 acres) + ($950 x 3 months) $ 20,850.00 TOTAL CITY DEVELOPMENT FEES $ 327,225.00 34. REDUCTION OF SECURITY. Upon receipt of proof satisfactory to the City that the required work has been satisfactorily completed and financial obligations have been satisfied, the Security may be reduced by seventy-five percent (75%) of the work completed and financial obligations satisfied upon written authorization by the City Engineer. Any requests for reductions in the Security must be made in writing to the City Engineer and must be accompanied by lien waivers from any contractor or subcontractor for the Developer. Twenty-five percent (25%) of the Security shall be retained until all Developer Installed Improvements and other obligations under this Development Contract have been completed, including, but not limited to, all financial obligations, and the receipt of all required as-built street, utility and grading plans by the City. Once the City has accepted the project, as-builts have been completed, all punch list items are completed and warranty bonds submitted, the Security may be reduced to 5% of the original amount. Upon completion of the warranty period the 5% Security may be released. In no event shall the five percent (5%) Page 16 Security be released until the Developer provides the City Engineer with a certificate from the Developer's registered land surveyor stating that all irons have been set following site grading and utility and street construction. 35. WARRANTY. The Developer warrants all Developer Installed Improvements required to be constructed by it pursuant to this Development Contract against poor material and faulty workmanship. The Developer shall post warranty bonds in the amount of twenty-five (25%) of the cost of the improvements as security. The warranty period for streets is one (1) year. The warranty period for underground utilities is two (2) years. The warranty period on Developer Installed Improvements shall commence on the date the City Engineer issues written acceptance of the improvement. All punch list items must be completed and “as- built” drawings received prior to the commencement of the warranty period. The retained Security and/or the warranty bonds may be used by the City to pay for warranty work. The City standard specifications for utilities and street construction identify the procedures for final acceptance of streets and utilities. These standards are set out in the PWDM. 36. OVERSIZING. City and Developer agree that the Developer Installed Improvements should be oversized for the benefit of future development. Oversizing is the construction of a Developer Installed Improvement to City specifications that exceeds those that would be required of the Developer. Oversizing improvements include, but are not limited to, sanitary sewer, water, storm drainage facilities, and road improvements. If the City Engineer determines that oversizing is required, the City shall reimburse the Developer for the costs associated with this work and as approved in this Development Contract. City and Developer agree that the cost of system oversizing to be reimbursed to the Developer is $0.00 based upon a cost estimate by the City Engineer as determined by an engineer’s estimate or contractors bid to be provided by the Developer and application of the City's Assessment Policy based on a final engineering design. The calculation for oversizing is attached as Exhibit D. 37. CLAIMS. Page 17 A. City Authorized to Commence Interpleader Action. In the event that the City receives claims from labor, materialmen, or others that work required by this Development Contract has been performed, the sums due them have not been paid, and the laborers, materialmen, or others are seeking payment, the Developer hereby authorizes the City to commence an Interpleader action pursuant to the Minnesota Rules of Civil Procedure for the District Courts, to draw upon the Security in an amount up to 125% of the claim(s) and deposit the funds in compliance with the Rules, and upon such deposit, the Developer consents to and shall not object to the Court issuing an order releasing, discharging, and dismissing the City from any further proceedings as it pertains to the Security deposited with the District Court, except that the Court shall retain jurisdiction to determine attorneys' fees pursuant to this Development Contract. B. Prompt Payment to Subcontractors Required. The Developer shall pay any subcontractor within ten (10) days of the Developer's receipt of payment for undisputed services provided by the subcontractor. If the Developer fails within that time to pay the subcontractor any undisputed amount for which the Developer has received payment, the Developer shall pay interest to the subcontractor on the unpaid amount at the rate of 1½ percent (1.5%) per month or any part of a month. The minimum monthly interest penalty payment for an unpaid balance of $100 or more is $10. For an unpaid balance of less than $100, the Developer shall pay the actual interest penalty due to the subcontractor. A subcontractor who prevails in a civil action to collect interest penalties from the Developer shall be awarded its costs and disbursement, including attorney's fees incurred in bringing the action, from the Security or other security provided by the Developer to the City. (See Minn. Stat. §471.425, Subd. 4a.) 38. RESPONSIBILITY FOR COSTS. A. The Developer shall reimburse the City for costs incurred in the enforcement of this Development Contract, including engineering and attorneys' fees. B. Unless otherwise specifically stated in this Development Contract, the Developer shall pay in full all bills submitted to it by the City for obligations incurred under this Development Contract within Page 18 thirty (30) days after receipt. If the bills are not paid on time, the City may issue a stop work order until the bills are paid in full. 39. DEVELOPER'S DEFAULT. A. Definition. In the context of this Development Contract, “Event of Default” shall include, but not be limited to, any one or more of the following events: (1) failure by the Developer to pay in a timely manner, all fees, charges, taxes, claims and liabilities, including but not limited to all real estate property taxes, utility charges, and assessments with respect to the development property; (2) failure by the Developer to construct the Developer Installed Improvements pursuant to the terms, conditions and limitations of this Development Contract; (3) failure by the Developer to observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed under this Development Contract; (4) transfer of any interest in the Property without prior written approval by the City Council (for the purpose of this paragraph, the sale of a lot, except an outlot, to a builder is not an event of default); (5) failure to correct any warranty deficiencies; (6) failure by the Developer to reimburse the City for any costs incurred by the City in connection with this Development Contract; (7) failure by the Developer to renew the Security at least forty-five (45) days prior to its expiration date; (8) receipt by the City from the Developer’s insurer of a notice of pending termination of insurance; (9) failure to maintain a current insurance certificate on file with the City meeting City requirements; (10) failure to maintain the required Security; or (11) a breach of any material provision of this Development Contract. With respect to this paragraph, “material provision” shall be construed broadly to offer the City the fullest protection and recourse possible. B. Event of Default - Remedies. Whenever an Event of Default occurs, the City, after providing the Developer with ten (10) days written notice in accordance with the terms of Paragraph 40 of this Development Contract, may take any one or more of the following actions: 1. The City may suspend its performance under this Development Contract. 2. The City may cancel or suspend this Development Contract. Page 19 3. The City may draw upon or bring action upon any or all of the securities provided to the City pursuant to any of the terms of this Development Contract. 4. The City may take whatever action, including legal or administrative action, which may be necessary or desirable to the City to collect any payments due under this Development Contract or to enforce performance and/or observance of any obligation, agreement or covenant of development under this Development Contract. 5. The City may suspend issuance of building permits and/or certificates of occupancy on any of the lots, including those lots sold to third parties. 7. The City may, at its option, install or complete the Developer Installed Improvements using the securities to pay for the related costs. 8. Suspend the release of any escrowed dollars. 9. Use of escrow dollars or other security to satisfy any outstanding financial obligations to the City including but not limited to all real estate property taxes, utility charges, and assessments with respect to the property; 10. Any fees, including attorney fees, incurred by the City associated with enforcing any of the provisions set out this Section 39 B shall be the sole responsibility of the Developer. C. Election of Remedies. None of the actions set forth in this Section are exclusive or otherwise limit the City in any manner. 40. NOTICES. Required Notices to the Developer shall be in writing, and shall be either hand delivered to the Developer, its employees or agents, or mailed to the Developer by certified mail at the following address: Terry Forbord C/O Hemlock Holdings LLC, 4960 Sussex Place, Shorewood, MN 55331-9217. Notices to the City shall be in writing and shall be either hand delivered to the City Manager, or mailed to the City by certified mail in care of the City Manager at the following address: City of Prior Lake, 4646 Dakota Street Page 20 SE, Prior Lake, Minnesota 55372. Concurrent with providing Notice to the City, Notice(s) shall be served upon the City Attorney Sarah Schwarzhoff, Gregerson, Rosow, Johnson & Nilan, LTD, 100 Washington Avenue South, Suite 1550, Minneapolis, MN 55401. Notices shall be deemed effective on the date of receipt. Any party may change its address for the service of notice by giving written notice of such change to the other party, in any manner above specified, 10 days prior to the effective date of such change. Notice related to an Event of Default shall include the following: (1) the nature of the breach of the term or condition that requires compliance by the Developer, or the Event of Default that has occurred; (2) what the Developer must do to cure the breach or remedy the Event of Default; and (3) the time the developer has to cure the breach or remedy the Event of Default. 41. INDEMNIFICATION. Developer shall indemnify, defend, and hold the City, its Council, agents, employees, attorneys and representatives harmless against and in respect of any and all claims, demands, actions, suits, proceedings, liens, losses, costs, expenses, obligations, liabilities, damages, recoveries, and deficiencies, including interest, penalties, and attorneys’ fees, that the City incurs or suffers, which arise out of, result from or relate to this Development Contract. The responsibility to indemnify and hold harmless the City, its Council, agents, employees, attorneys and representatives does not extend to any willful or intentional misconduct on the part of any of these individuals. 42. NO THIRD PARTY RECOURSE. The City and Developer agree that third parties shall have no recourse against the City under this Development Contract. The Developer agrees that any party allegedly injured or aggrieved as a result of the City’s approval of the Plat shall seek recourse against the Developer or the Developer’s agents. In all such matters, including court actions, the Developer agrees that the indemnification and hold harmless provisions set out in Paragraph 41 shall apply to said actions. This Development Contract is a contract agreement between the City and the Developer. No provision of this Development Contract inures to the benefit of any third person, including the public at large, so as to constitute Page 21 any such person as a third-party beneficiary of the Development Contract or of any one or more of the terms hereof, or otherwise give rise to any cause of action for any person not a party hereto. 43. INSURANCE REQUIREMENTS. Developer, at its sole cost and expense, shall take out and maintain or cause to be taken out and maintained, until the expiration of the warranty period(s) on the Developer Installed Improvements, public liability and property damage insurance covering personal injury, including death, and claims for property damage which may arise out of Developer's work or the work of its subcontractors or by one directly or indirectly employed by any of them. Limits for bodily injury and death shall be not less than $1,500,000 for one person and $2,000,000 for each occurrence; limits for property damage shall be not less than $500,000 for each occurrence; or a combination single limit policy of $1,500,000 or more. The City shall be named as an additional insured on the policy, and the Developer shall file with the City a certificate evidencing coverage prior to the City signing the Plat. The certificate shall provide that the City must be given thirty (30) days advance written notice of the cancellation of the insurance. The Certificate shall be in the form attached hereto as Exhibit C or another form acceptable to the City. Each insurance certificate shall have the project name and City project number clearly shown. 44. RECORDING DEVELOPMENT CONTRACT. This Development Contract shall run with the land. The Developer, at its sole cost and expense, shall record this Development Contract against the Property within sixty (60) days of the City Council’s approval of the Development Contract. The Developer shall provide the City with a recorded copy of the Development Contract. The Developer covenants with the City, its successors and assigns, that the Developer is well seized in fee title of the property being final platted and/or has obtained consents to this Development Contract, in the form attached hereto, from all parties who have an interest in the Property; that there are no unrecorded interests in the Property being final platted; and that the Developer indemnifies and holds the City harmless for any breach of the foregoing covenants. 45. SPECIAL PROVISIONS. The following special provisions shall apply to Plat development: Page 22 A. Developer shall comply with all of the conditions listed in the Resolution approving the final Plat. B. The Developer is required to submit the final Plat in electronic format. The electronic format shall be compatible with the City's current software. In addition, upon completion of the project the Developer shall provide the City with as-built utility plans in electronic format compatible with the City’s current software and with layers, colors, and line-types formatted in accordance with City standards. Additionally, three (3) full size (22 X 34 inch) paper copies and one (1) reduced (11 X 17 inch) copy shall be certified and submitted to the City. C. The Developer hereby waives any claim against the City for removal of signs placed in the right-of-way in violation of the City Zoning Ordinance and State Statutes. The City shall not be responsible for any damage to, or loss of, signs removed. 46. MISCELLANEOUS. A. Compliance With Other Laws. The Developer represents to the City that the Plat and the Developer in performing all work under this Development Contract shall comply with all county, metropolitan, state, and federal laws and regulations, including but not limited to: subdivision ordinances, zoning ordinances, and environmental regulations. If the City determines that the Plat or Developer is not in compliance, the City may, at its option, refuse to allow construction or development work on the Property until the Developer does comply. Upon the City's demand, the Developer shall cease work until there is compliance. B. Severability. If any portion, section, subsection, sentence, clause, paragraph, or phrase of this Development Contract is for any reason held invalid, such decision shall not affect the validity of the remaining portion of this Development Contract. Page 23 C. Amendments. There shall be no amendments to this Development Contract unless in writing, signed by the parties and approved by resolution of the City Council. The City's failure to promptly take legal action to enforce this Development Contract shall not be a waiver or release. D. Assignment. The Developer may not assign this Development Contract without the prior written approval of the City Council. The Developer's obligation hereunder shall continue in full force and effect even if the Developer sells one or more lots, the entire Property, or any part of it. E. Interpretation. This Development Contract shall be interpreted in accordance with and governed by the laws of the State of Minnesota. The words herein and hereof and words of similar import, without reference to any particular section or subdivision, refer to this Development Contract as a whole rather than to any particular section or subdivision hereof. Titles in this Development Contract are inserted for convenience of reference only and shall be disregarded in constructing or interpreting any of its provisions. F. Jurisdiction. This Development Contract shall be governed by the laws of the State of Minnesota. G. Successors and Assigns. Provisions of this Development Contract shall be binding upon and enforceable against Developers successors and assigns including but not limited to all purchasers and owners of all or any part of the Property and their successors and assigns. 47. LAND SWAP. City owns a portion of the Property at the corner of the final Plat on which a storm water pond is located. Developer has requested that the City transfer a portion of the City’s Property to Developer in exchange for several portions of the Propert y owned by the Developer in order to allow for straighter lot lines. In conjunction with the approval and recording of the final Plat, City and Developer shall execute the Purchase Agreement, attached hereto as Exhibit G, in order to complete the land swap. Page 24 CITY OF PRIOR LAKE By:________________________________ (SEAL) Kenneth L. Hedberg, Mayor By:________________________________ Frank Boyles, City Manager STATE OF MINNESOTA ) ( ss. COUNTY OF SCOTT ) The foregoing instrument was acknowledged before me this _____ day of ____________, 2016, by Kenneth L. Hedberg, Mayor, and by Frank Boyles, City Manager, of the City of Prior Lake, a Minnesota municipal corporation, on behalf of the corporation and pursuant to the authority granted by its City Council. _____________________________________ NOTARY PUBLIC Page 25 HEMLOCK HOLDINGS LLC: By:________________________________ Its:_______________________________ STATE OF MINNESOTA ) ( ss. COUNTY OF __________ ) The foregoing instrument was acknowledged before me this ______ day of ____________, 2016, by ______________________________ the __________________________ of Hemlock Holdings LLC. _____________________________________ NOTARY PUBLIC DRAFTED BY: City of Prior Lake 4646 Dakota Street SE Prior Lake, Minnesota 55372 Page 26 MORTGAGEE CONSENT TO DEVELOPMENT CONTRACT Bridgewater Bank, which holds a mortgage on the subject property, the development of which is governed by the foregoing Development Contract, agrees that the Development Contract shall remain in full force and effect even if it forecloses on its mortgage. Dated this _____ day of ____________, 2016. BRIDGEWATER BANK By:________________________________ Its:_______________________________ STATE OF MINNESOTA ) ( ss. COUNTY OF __________ ) The foregoing instrument was acknowledged before me this _____ day of ________________, 2016, by the _______________________ of Bridgewater Bank. ________________________________________ NOTARY PUBLIC DRAFTED BY: City of Prior Lake 4646 Dakota Street SE Prior Lake, Minnesota 55372 Page 27 CONTRACT PURCHASER CONSENT TO DEVELOPMENT CONTRACT __________________________________, which has a contract purchaser's interest in all or part of the subject property, the development of which is governed by the foregoing Development Contract, hereby affirms and consents to the provisions thereof and agrees to be bound by the provisions as the same may apply to that portion of the subject property in which there is a contract purchaser's interest. Dated this _____ day of ____________, 2016. XXX By:________________________________ Its:_______________________________ STATE OF MINNESOTA ) ( ss. COUNTY OF __________ ) The foregoing instrument was acknowledged before me this _____ day of ________________, 2016, by the ______________________________ of ________________________________. ________________________________________ NOTARY PUBLIC DRAFTED BY: City of Prior Lake 4646 Dakota Street SE Prior Lake, Minnesota 55372 Page 28 EXHIBIT "A" TO DEVELOPMENT CONTRACT Legal Description of Property Being Final Platted and Copy of Final Plat, Including Title Sheet: Page 29 EXHIBIT “B” SAMPLE IRREVOCABLE LETTER OF CREDIT (LOC must be from a bank authorized to do business in Minnesota with a principal branch in the 7-county metropolitan area) No. ___________________ Date: _________________ TO: City of Prior Lake 4646 Dakota Street SE Prior Lake, Minnesota 55372 Dear Sir or Madam: We hereby issue, for the account of (Name of Developer) and in your favor, our Irrevocable Letter of Credit in the amount of $____________, available to you by your draft drawn on sight on the undersigned bank. The draft must: a) Bear the clause, "Drawn under Letter of Credit No. __________, dated ________________, 20___, of (Name of Bank) "; b) Be presented for payment at (Address of Bank) , on or before 4:00 p.m. on December 31, 20___. c) Presentation also will be deemed made upon our receipt of your telecopier transmission to us at Fax No. ____________ of a facsimile of the appropriate sight draft accompanied by wire transfer instructions as to where we are to wire the funds together with your telephone advice to us at Telephone number ______________ (or such other number as we shall specify to you) of your sending the above described telecopy transmission. This Letter of Credit shall automatically renew for successive one-year terms unless, at least forty-five (45) days prior to the next annual renewal date (which shall be December 31 of each year), the Bank delivers written notice to the Prior Lake City Manager that it intends to modify the terms of, or cancel, this Letter of Credit. Written notice is effective if sent by certified mail, postage prepaid, and deposited in the U.S. Mail, at least forty-five (45) days prior to the next annual renewal date addressed as follows: Prior Lake City Manager, Prior Lake City Hall, 4646 Dakota Street SE, Prior Lake, Minnesota 55372-1714, and is actually received by the City Manager at least forty-five (45) days prior to the renewal date. In the event that at least forty-five (45) days prior to the expiry date listed above, this Letter of Credit is not automatically renewed as set forth in the preceding paragraph or is not extended for a period of at least one year or has not been replaced with a substitute Letter of Credit acceptable to you, this Letter of Credit is also payable to you upon presentation to us of your sight draft as set forth in paragraphs a), b) and c) above. This Letter of Credit sets forth in full our understanding which shall not in any way be modified, amended, amplified, or limited by reference to any document, instrument, or agreement, whether or not referred to herein. This Letter of Credit is not assignable. This is not a Notation Letter of Credit. More than one draw may be made under this Letter of Credit. This Letter of Credit shall be governed by the most recent revision of the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce Publication No. 600. We hereby agree that a draft drawn under and in compliance with this Letter of Credit shall be duly honored upon presentation. BY: ____________________________________ Its ______________________________ Page 30 EXHIBIT “C” SAMPLE CERTIFICATE OF INSURANCE PROJECT: CERTIFICATE HOLDER: City of Prior Lake 4646 Dakota Street SE Prior Lake, Minnesota 55372 INSURED: ADDITIONAL INSURED: City of Prior Lake AGENT: WORKERS' COMPENSATION: Policy No. __________________ Effective Date: ______________ Expiration Date: _____________ Insurance Company: COVERAGE - Workers' Compensation, Statutory. GENERAL LIABILITY: Policy No. __________________ Effective Date: ______________ Expiration Date: _____________ Insurance Company: ( ) Claims Made ( ) Occurrence LIMITS: [Minimum] Bodily Injury and Death: $1,000,000 for one person $2,000,000 for each occurrence Property Damage: $500,000 for each occurrence -OR- Combination Single Limit Policy $1,000,000 or more COVERAGE PROVIDED: Operations of Contractor: YES Page 31 Operations of Sub-Contractor (Contingent): YES Does Personal Injury Include Claims Related to Employment? YES Completed Operations/Products: YES Contractual Liability (Broad Form): YES Governmental Immunity is Waived: YES Property Damage Liability Includes: Damage Due to Blasting YES Damage Due to Collapse YES Damage Due to Underground Facilities YES Broad Form Property Damage YES AUTOMOBILE LIABILITY: Policy No. __________________ Effective Date: ______________ Expiration Date: _____________ Insurance Company: (X) Any Auto LIMITS: [Minimum] Bodily Injury: $1,000,000 each person $2,000,000 each occurrence Property Damage: $500,000 each occurrence -OR- Combined Single Limit Policy: $1,000,000 each occurrence ARE ANY DEDUCTIBLES APPLICABLE TO BODILY INJURY OR PROPERTY DAMAGE ON ANY OF THE ABOVE COVERAGES: If so, list: Amount: $________________ [Not to exceed $1,000.00] SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL MAIL THIRTY (30) DAYS WRITTEN NOTICE TO THE PARTIES TO WHOM THIS CERTIFICATE IS ISSUED. Dated at _____________________________ On __________________________________ BY: _________________________________ Authorized Insurance Representative Page 32 EXHIBIT "D" TO DEVELOPMENT CONTRACT (Oversizing Calculations for Developer Installed Improvements) NO OVERSIZING COSTS ARE INCLUDED WITH THIS AGREEMENT Page 33 EXHIBIT “E” TO DEVELOPMENT CONTRACT ESTIMATED CONSTRUCTION COSTS [ATTACHED 2 PAGES] Page 34 Page 35 Page 36 EXHIBIT “F” TO DEVELOPMENT CONTRACT CONDITIONS OF PLAT APPROVAL a. All utilities and roads shall be constructed in conformance with the Public Works Design Manual. b. Prior to release of the signed final plat mylars, the developer shall pay all fees detailed in the Development Contract. c. The Developer shall be responsible for submitting reductions of the Chatonka Heights Final Plat to the following scales: 1” = 200’; and one reduction at no scale which fits onto an 8 1/2” x 11” sheet of paper. d. Four mylar sets of the final plat with all required signatures must be submitted. e. The final plat and all pertinent documents must be filed with Scott County within 60 days from the date of final plat approval. Failure to record the documents by _____________ will render the final plat null and void. Page 37 EXHIBIT “G” TO DEVELOPMENT CONTRACT PURCHASE AGREEMENT THIS PURCHASE AGREEMENT (this “Agreement”) is dated as of ____________ ____, 2016 between the City of Prior Lake, a Minnesota municipal corporation (“City”) and Hemlock Holdings LLC, a Minnesota Limited Liability Company (“Developer”). RECITALS Developer is the fee owner of certain real property located in Scott County, Minnesota, depicted on attached Exhibit A; the real property, together with all buildings and improvements constructed or located on and all easements and rights benefiting or appurtenant to the real property is collectively referred to herein as the “Developer Land”. City is the fee owner of certain real property located in Scott County, Minnesota, depicted on attached Exhibit A; the real property, together with all buildings and improvements constructed o r located on and all easements and rights benefiting or appurtenant to the real property is collectively referred to herein as the “City Land”. City and Developer desire to plat the Developer Land and City Land and to exchange two portions of the Developer Land depicted on attached Exhibit B (“Developer Real Property”) for a portion of the City Land depicted on attached Exhibit B (“City Real Property”) pursuant to the terms of this Agreement. For purposes of this Agreement, Seller shall mean the City with regard to the City Real Property and Developer with regard to the Developer Real Property, and Buyer shall mean Developer with regard to the City Real Property and the City with regard to the Developer Real Property, and Real Property shall mean the City Real Property in the case of the property to be conveyed to the Developer hereunder and the Developer Real Property in the case of property to be conveyed to the City hereunder. NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. Conveyance of Real Property and Consideration. City agrees to convey to Developer the City Real Property in consideration for receipt of the Developer Real Property. Developer agrees to convey to City the Developer Real Property in consideration for receipt of the City Real Property. 2. Title to Be Delivered. Upon Closing, City shall deliver to Developer a Quit Claim Deed conveying fee title to the City Real Property subject to the exceptions to title set forth in attached Exhibit C (“Permitted Encumbrances”). Upon Closing, Developer shall deliver to City a Quit Claim Deed conveying fee title to the Developer Real Property subject to the Permitted Encumbrances. 3.A. Contingencies. Unless waived by Buyer in writing, Buyer’s obligation to purchase the Real Property shall be subject to and contingent upon each of the following: Page 38 3.1 Representations and Warranties. The representations and warranties of Seller contained in this Agreement must be true now and on the Closing Date as if made on the Closing Date and Seller shall have delivered to Buyer at Closing a certificate dated the Closing Date, signed by Seller, certifying that such representations and warranties are true as of the Closing Date (“Bring-down Certificate”). 3.2 Performance of Seller’s Obligations. Seller shall have performed all of the obligations required to be performed by Seller under this Agreement, as and when required by this Agreement. 3.3 Title. Title shall have been found acceptable by Buyer. 3.4 No Adverse Action. There shall not exist on the Closing Date any lawsuit, governmental investigation or other proceeding challenging the transaction contemplated in this Agreement, or which might adversely affect the right of Buyer to own, develop, or use the Real Property after the Closing Date for Buyer’s intended use. 3.5 Plat. The sale and purchase of Real Property described in this Agreement shall not occur unless the Final Plat of Chatonka Heights has been approved by the City and recorded at the Office of the Scott County Recorder. 3.B. Termination by Buyer. Unless waived by Buyer in writing, Buyer’s obligation to purchase the Real Property shall be subject to and contingent upon the following: If any of the foregoing contingencies set forth in Section 3.A. of this Agreement have not been satisfied on or before the stated date then this Agreement may be terminated, at Buyer’s option, by written notice from Buyer to Seller. Such notice of termination shall be given no later than three (3) business days after the stated date for the relevant contingency item or the Closing Date, whichever occurs first. If Buyer fails to give notice of termination as provided above, the contingencies are automatically deemed waived. Buyer may also waive any contingency by written notice to Seller but such written notice is not required for a waiver to be effective. Upon a termination by Buyer, Buyer and Seller shall execute a recordable written termination of this Agreement, which shall include Buyer’s quit claim of any interest in and to the Real Property and upon fulfillment of said quit claim neither party will have any further rights or obligations regarding this Agreement or the Real Property except for the rights and obligations of indemnification set forth in Sections 8 and 9. 4. Closing. The closing of the purchase and sale contemplated by this Agreement (“Closing”) shall occur in conjunction with the recording of the Final Plat of Chatonka Heights (“Closing Date”). Seller agrees to deliver possession of the Real Property to Buyer on the Closing Date. Performance by each party is contingent upon performance by the other party of the obligations set forth in this paragraph. 5. Seller’s Closing Documents. On the Closing Date, Seller shall execute and/or deliver to Buyer the following (collectively, “Seller’s Closing Documents”): 5.1 Deed. A Quit Claim Deed, in form and substance as attached hereto as Exhibit D, conveying the Real Property to Buyer, free and clear of all encumbrances, except the Permitted Encumbrances. Page 39 5.2 Bring-down Certificate. A certificate reaffirming as of the Closing Date all of the Seller’s Representations and Warranties contained in Section 8 of this Agreement. 5.3 Seller’s Affidavit. An Affidavit of Seller indicating that on the Closing Date (a) there are no outstanding, unsatisfied judgments, tax liens or bankruptcies against or involving Seller or the Real Property; (b) there has been no skill, labor or material furnished to the Real Property for which payment, or provision for payment, has not been made or for which mechanic’s liens could be filed; and (c) there are no other unrecorded interests in the Real Property of which Seller has knowledge, together with whatever standard owner’s affidavit and/or indemnity (ALTA Form) which may be required by Title Company to issue the Title Policy described in Section 7 of this Agreement. 5.4 FIRPTA Affidavit. A non-foreign affidavit, properly executed and in recordable form, containing such information as is required by IRC Section 1445(b)(2) and its regulations. 5.5 IRS Reporting Form. The appropriate Federal Income Tax reporting form, if any, as required. 5.6 Executive Order Affidavit. An affidavit properly executed and in recordable form satisfying Buyer and Title Company that the Seller is not a blocked person under Executive Order 13224. 5.7 Other Documents. All other documents reasonably determined by Buyer to be necessary to transfer the Real Property to Buyer free and clear of all encumbrances, except the Permitted Encumbrances. 6. Prorations. Seller and Buyer agree to the following prorations and allocation of costs regarding this Agreement: 6.1 Title Insurance; Closing Fee; Deed Tax; Recording Costs; Other Costs; Attorney’s Fees. Developer shall pay all costs of the Title Evidence described in Section 7 of this Agreement. Developer shall pay any closing fee or charge imposed by any closing agent designated by Title Company. Developer shall pay all state deed tax regarding the deeds to be recorded under this Agreement. Developer shall pay the cost of recording all documents necessary to complete the purchase and sale set forth in this Agreement. Developer shall pay its own and City’s attorney fees relating to this Agreement and the Plat of Chatonka Heights. Buyer shall pay the fee for the Title Policy. 6.2 Real Estate Taxes and Special Assessments. Developer shall be responsible for paying all real estate taxes and assessments due in relation to the Real Property whether due and payable before or after the Closing Date. 7. Title Examination. Title examination will be conducted in conjunction with the review of the Final Plat of Chatonka Heights. Developer shall obtain and provide to the City a commitment (“Title Commitment”) on the most current ALTA Form B Owner’s Policy of Title Insurance insuring title to the Developer Real Property in the amount of the ___________________, issued by Land Title, Inc. (“Title Company”). The Title Commitment will commit Title Company to insure title to the Developer Real Property subject only to the Permitted Encumbrances (“Title Policy”). Page 40 8. Representations and Warranties by Seller. Seller represents and warrants to Buyer as follows: 8.1 Authority. Seller has the requisite power and authority to enter into and perform this Agreement and those Seller’s Closing Documents signed by it. Such documents have been (or will have been) duly executed and delivered. Such execution, delivery and performance by Seller of such documents do not (and will not) conflict with or result, as applicable, in a violation of any judgment, order, or decree of any court or arbiter to which Seller is a party. Such documents are (and will be) valid and binding obligations of Seller, and are enforceable in accordance with their terms. 8.2 Title to Real Property. The Real Property shall be conveyed to the Buyer free and clear of all encumbrances except the Permitted Encumbrances. 8.3 Rights of Others to Purchase Real Property. Seller has not entered into any other contracts for the sale of the Real Property, nor are there any rights of first refusal or options to purchase the Real Property or any other rights of others that might prevent the consummation of this Agreement. 8.4 Seller’s Defaults. Seller is not in default concerning any of its obligations or liabilities regarding the Real Property. 8.5 FIRPTA. Seller is not a “foreign person,” “foreign partnership,” “foreign trust” or “foreign estate” as those terms are defined in Section 1445 of the Internal Revenue Code. 8.6 Proceedings. There is no action, litigation, investigation, condemnation or proceeding of any kind pending or threatened against Seller or any portion of the Real Property. 8.7 Agents and Employees. No management agents or other personnel employed in connection with the operation of the Real Property have the right to continue such employment the Closing Date. There are no claims for brokerage commission or other payments with respect to the existing Real Property, including leases which will survive and remain unpaid after the Closing Date. 8.8 Environmental Laws. To the best of Seller’s knowledge, no toxic or hazardous substances or wastes, pollutants or contaminants (including, without limitation, asbestos, urea formaldehyde, the group of organic compounds known as polychlorinated biphenyls, petroleum products including gasoline, fuel oil, crude oil and various constituents of such products, and any hazardous substance as defined in the Comprehensive Environmental Response Compensation and Liability Act of 1980 (“CERCLA”), 42 U.S.C. §9601 -9657, as amended) have been generated, treated, stored, released or disposed of, or otherwise placed, deposited in or located on the Real Property nor has any activity been undertaken on the Real Property that would cause or contribute to (a) the Real Property to become a treatment, storage or disposal facility within the meaning of, or otherwise bri ng the Real Property within the ambit of, the Resource Conservation and Recovery Act of 1976 (“RCRA”), 42 U.S.C. §6901 et seq., or any similar state law or local ordinance, (b) a release or threatened release of toxic or hazardous wastes or substances, pollutants or Page 41 contaminants, from the Real Property within the meaning of, or otherwise bring the Real Property within the ambit of, CERCLA, or any similar state law or local ordinance, or (c) the discharge of pollutants or effluents into any water source or s ystem, the dredging or filling of any waters or the discharge into the air of any emissions, that would require a permit under the Federal Water Pollution Control Act, 33 U.S.C. §1251 et seq., or the Clean Air Act, 42 U.S.C. § 7401 et seq., or any similar state law or local ordinance. To the best of Seller’s knowledge there are no substances or conditions in or on the Real Property that may support a claim or cause of action under RCRA, CERCLA or any other federal, state or local environmental statutes, regulations, ordinances or other environmental regulatory requirements, including without limitation, the Minnesota Environmental Response and Liability Act, Minn. Stat. 115B (“MERLA”) and the Minnesota Petroleum Tank Release Cleanup Act, Minn. Stat. 115C. To the best of Seller’s knowledge no above ground or underground tanks, are located in or about the Real Property or have been located under, in or about the Real Property and have subsequently been removed or filled. To the best of Seller’s knowledge all storage tanks which exist on or under the Real Property have been duly registered with all appropriate regulatory and governmental bodies and otherwise are in compliance with applicable federal, state and local statutes, regulations, ordinances and other regulatory requirements. Seller will indemnify Buyer, its successors and assigns, against, and will hold Buyer, its successors and assigns, harmless from, any expenses or damages including reasonable attorneys’ fees, that Buyer incurs because of the breach of any of the above representations and warranties, whether such breach is discovered before or after Closing. Each of the representations and warranties herein contained shall survive the Closing for a period of one year. Consummation of this Agreement by Buyer with knowledge of any breach of such representations and warranties by Seller will constitute a waiver or release by Buyer of any claims due to such breach. 9. Mutual Indemnification. Seller and Buyer agree to indemnify each other against, and hold each other harmless from, all liabilities (including reasonable attorney’s fees in defending against claims) arising out of the ownership, operation or maintenance of the Real Property for their respective periods of ownership. Such rights of indemnification will not arise to the extent that (a) the party seeking indemnification actually receives insurance proceeds or other cash payments directly attributable to the liability in question, (net of the cost of collection, including reasonable attorney’s fees) or (b) the claim for indemnification arises out of the act or neglect of the party seeking indemnification. If and to the extent that the indemnified party has insurance coverage, or the right to make claim against any third party for any amount to be indemnified against as set forth above, the indemnified party will, upon full performance by the indemnifying party of its indemnification obligations, assign such rights to the indemnifying party or, if such rights are not assignable, the indemnified party will diligently pursue such rights by appropriate legal action or proceeding and assign the recovery and/or right of recovery to the indemnifying party to the extent of the indemnification payment made by such party. 10. Assignment. Neither Buyer nor Seller may assign this Agreement without the prior written approval of the other party. 11. Survival. All of the terms of this Agreement will survive and be enforceable for a period of one year after the Closing. 12. Captions. The paragraph headings or captions appearing in this Agreement are for Page 42 convenience only, are not a part of this Agreement and are not to be considered in interpreting this Agreement. 13. Entire Agreement; Modification. This written Agreement constitutes the complete agreement between the parties and supersedes any prior oral or written agreements between the parties regarding the Real Property. There are no verbal agreements that change this Agreement and no waiver of any of its terms will be effective unless in writing executed by the parties. 14. Binding Effect. This Agreement binds and benefits the parties and their successors and assigns. 15. Controlling Law. This Agreement has been made under the laws of the State of Minnesota, and such laws will control its interpretation. 16. Remedies. The sole remedy for default under this Agreement shall be termination of the Agreement. Upon default, the non-defaulting party shall have the right to terminate this Agreement by giving written notice to the defaulting party. If the defaulting party f ails to cure such default within ten (10) days of the receipt of such notice, this Agreement will terminate. SIGNATURES ON SUCCEEDING PAGE Page 43 IN AGREEMENT, City and Developer have executed this Agreement as of the date first written above. DEVELOPER Hemlock Holdings LLC _________________________ By:__________________________ Date Its:__________________________ CITY OF PRIOR LAKE ____________________________ _____________________ Kenneth L. Hedberg, Mayor Date ___________________________ _____________________ Frank Boyles, City Manager Date Page 44 EXHIBIT A - City Land and Developer Land EXHIBIT B - City Real Property and Developer Real Property EXHIBIT C - Permitted Encumbrances EXHIBIT D - Quit Claim Deeds