269828 W H I 7 E - C I T V C L ER K . l��������- .
PINK - FINANCE GITY OF SAINT PAUL COLI1C11 � �
CANARV - DEPARTMENT �
BLUE -MAYOR . Flle NO.
Cou cil Resolution
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Presented By ��
Referred To Committee: Date
Oot of Committee By Date
RESOLVED, That the Council of the City of Saint Paul hereby
approves the �agreement between the City, Housing and Redevelopment
Authority of the City of Saint Paul, Kraus-Anderson of St. Paul
Company and Help Encourage Local Progress in the Summit-University
Area, Inc. , whereby the Housing Authority would advance the sum of
$100,000 towards defraying operating costs of the Uni-Dale
shopping center, the sum to be repaid to the Authority from
operating profits received by the developers of the center, and
the proper City officers are hereby authorized to execute the
said agreement on behalf of the City of Saint Paul. •
COUNCILMEN Requested by Department of:
Yeas Nays
Butler
Hozza [n Favor
Hunt
Levine __j�,�__ Against BY
Roedler
Sylvester __
Tedesco ,..�—`"' SEP Z'7 �9T7 Form Approved ty Att n y
Adopted b�%,--�ouncil: ate
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Cer�if�fed Yass Coun il etary • BY
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Appro `� 1�lavor. . D c _ SEP 3 0 1977 Appro e y Mayor for Subm si to Council
By BY k
FUBLISHED G+CT 8 19?7
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• AGP,EE��IENT ����r�
THIS AGREEMEP�T, entered into on this day of , 1977, '
by and between Help Encourage Local Progress in the Summit-University Area,
Inc. , a Minnesota non-profit corporation (hereinafter referred to as "Help") ,
Unidale Development Corporation, a Minnesota corporation (hereinafter desiqnated
"Unidale") , Kraus-Anderson of St. Paul Co. , a D1innezota corporation (hereina�ter
referred to as "KA") , and the City of St. Paul , a municipal corporation of the
State of htinnesota (hereinafter designated "City") , and the St. Paul Housing
and Redevelopment Authority (hereinafter referred to as "St. Paul HRA") .
W I T N E S S E T H:
WHEREAS, KA and Unidale executed that certain Joint Development Agreement
on the 30th day of August, 1976, a copy of which is attached hereto as
Exhibit A and incorporated herein by this reference, wherein Unidale and KA
agreed to joint venture in the development of a shopping center on lands to
be acquired from the St. Paul HRA located at the �southeast corner of the
intersection of University Avenue and Dale Street in the City of St. Paul
(hereinafter "Project") ; and
WHEREAS, pursuant to the terms of the said Joint Development Agreement,
Unidale and KA agreed to form a partnership (hereinafter "Partnership") ; and
WHEREAS, the •City and Help entered into that certain Community Development
B1ock Grant Program Agreement, dated the 30th day of August, 1976, whereby
the City agreed to grant to Help the sum of Five Hundred Thousand ($500,000)
� Dollars to be expended in connection with the construction and development of
the Project; and - .
WHEREAS, in order to secure long term financing for the Project throuqh
lenders, it has become necessary to secure commitments for additional capital
_ for the Project and to adjust the Partnership ownership percentage as set
forth hereinafter; and �
ItiHEREAS, the St. Paul HRA has agreed to comr�it the sum of .One Hundred
Thousand (5100,000) Dollars to Help for advance to the Partnership on the
terms and conditions set forth hereinafter and Y.A has agreed to advance the
sum of One Hund►-ed Thousand (�100,000) Dollars to the Partnershi.p pursuant
, to the terms of the Joint Development Agreement and on the terms and conditions
set forth hereinafter;
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f�Ol�1, THEREFORE, the parties hereto hereby agr�e as follows :
1 . Adjustment of Partnership Ownership. Notwithstanding any provision
in the Joint Development Agreement to the contrary, Unidale and KA agree that
upon the establishment of the Partnership pursuant to the terms of the Joint
Development Agreement, the respective ownership percentages of the Partnership
shall be as follows: � �
Unidale: 49� �
KA's designee: 51�
2. Additional Capital Contribution of Help. The St. Paul HRA agrees to
. advance to Help for advance to the Partnership, up to the sum of One Hundred
Thousand (�100,000) Dollars , on the following terms and conditions :
� , a. The St. Paul HRA shall have no obligation to advance funds
under this Section 2 until after all funds available in the
Capital Reserve Account and P.epayment Reserve Account provided
for in the Community Development Block Grant Program Agree-
ment have first been applied to Help's share of operating
cash losses. Al1 funds advanced by the St. Paul HRA shall �other-
wise be advanced in accordance with the terms and conditions of
the Community Development Block Grant Program Agreement and of
this Section 2;
b. Any funds advanced by the St. Paul HRA shall be utilized by
Help to defray forty-nine (49�) percent of the operating cash
losses of the Project incurred during the first five (5) years
of the Project' s operation. The Project shall be deemed to have
commenced operations upon the day the first tenant of the Project
commences business operations;
c. Any sums advanced hereunder shall be advanced on a monthly basis
by the St. Paul HRA as follows : On or before the 15th day of
each month the Partnership shall submit to the St. Paul HRA a
statement of operating profits and losses of the Project
for the preceding month' s operation, which statenients shall be
prepared in accordance With generally accepted accounting
principles consistently applied and shall indicate the an�ount
of operating cash losses of the Project incurred during the
preceding month of operations, if any. Within fifteen (15)
days of receipt of such statement, the St. Paul HRA shall remit
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. to Help for advance to the Partnership�, forty-nine (49°�) percent
of the amount of any such operating cash losses. If at the end
of the first, second, third or'fourth year of the Project's
opera�tions , and, in each case, following the submission of
Help's certified audit in accordance with the provisions of the
Community Development Block Grant Program Agreement, such audit
� reveals that an amount in excess of forty-nine (49%) percent �of
the total operating cash losses during the preceding year has been
� advanced by the St. Paul HRA to Help, the St. Paul HRA shall re-
� ceive a credit equivalent to such excess which shall be credited
.
against the operating cash losses next occurring. Following the
fifth (5th). year of operations of the Project, and the submission
of Help's certified audit, if such audit reveals that an amount in
. excess of forty-nine (49%) percent of the total operating cash
losses during the preceding year(s) has ,been advanced by the
St. Paul tiRA and has not been otherwise credited to any subse-
quent operating losses of the Project, or previously repaid
to the St. Paul HRA, the Partnership shall reimburse the St.
� Paul HRA within ninety (90) days following the Partnership's
receipt of such certifi.ed audit.
d. Not withstanding any provision in the Community Development Block
Grant Program Agreement to the contrary:
(i ) Any Project Income (as defined in Section 4 of said
Community Development Block Grant Agreement) distrib-
utable to Help�or its subsidiary, Unidale, which is not
' assigned to the Capital Reserve Account shall be paid
� first to the St. Paul HRA to the extent any funds have
been advanced pursuant to this Section 2 and remain
unreimbursed , with the balance of any Project Income
paid over to the Repayment Reserve Account and to the
City pursuant to the terms of the Community Development
Block Grant Program Agreement; and
� (ii ) Any proceeds of a sale, transfer, refinancing or other
disposition of the Project (as defined in the Community
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Development Block Grant Program Agreement) , distributable
to Help or its subsidiary, Unidale, shall .be paid first
• - to the St. Paul HRA to the .extent any funds have been � �
,
, advanced pursuant to this Section 2 and remain unreimbursed,
with the balance of such proceeds, if. any, disbursed in
accordance with the terms of the Community Development "
Block Grant.Program Agreement.
e. Al1 fux�ds advanced by the St. Paul HRA to Help for advance to the
Partnership shall be so .advanced by Help immediately upon the
receipt of such funds. _
� � 3. Capital Contribution of KA. P,s provided in the Joint Development
Agreement, KA agrees to advance up to the sum of One Hundred Thousand (�100,000)
Dollars to the Partnership through its affiliate as defined in paragraph 13
of the Joint Development Agreement, in accordance with the following terms and
conditions: �
a. Any sums advanced hereunder shall be advanced on a monthly
basis by KA's affiliate as follows:
(i ) On or before the 15th day of each month the Partnership
shall submit to KA' s affiliate a st�atement of operating
profits and losses of the Project for the preceding .
month's operations , which statement shall be prepared
in accordance with generally accepted accounting principles
consistently applied , and shall indicate the amount
of operating cash losses of the Project incurred during
the preceding month of operations, if any. Withi.n
fifteen (15) days of receipt of such statement, KA's
affiliate shall remit to the Partnership fifty-one (51�)
percent of the amount of any such operating cash losses,
if any. If at the end of the first, second , third , or
fourth year of the Project' s operation, and in each case,
following the review by Y.A' s affiliate of 1�elp's certified
audit, such audit reveals that an amount in excess of fifty-
one (51�) percent of the total operating cash losses during
the preceding year has been advanced by KA�s affiliate to the
Partnership, KA' s affiliate shall receive a credit equi-
valent to such excess which shall be credited against the
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� � �perating cash losses next occuring. Following the fifth
(5th) year of operations of the Project, and �the submission
of Help' s certified audit, if such audit reveals that an
amount in excess of fifty-one (51�) percent of the total
oper,ating cash losses during the preceding year has been
advanced by KA's affiliate to the Partnership, . KA's affiliate
shall receive a credit equivalent to such excess which shall
be credited aaainst the operating cash losses next occurring.
� Following the fifth t5th) year of operations of the Project,
and the submission of Help's certified audit, .if such audit
reveals that an amount in excess of fifty-one (51%) percent
' of� the total operating cash, losses during the preceding year(s;
has been advanced by KA' s affiliate to the Partnership, and
has not been otherwise credited to any subsequent operating
losses of the Project,� or previously repaid to KA's affiliate ,
the Partnership shall reimburse KA's affiliate for any such
amount within ninety (90) days following tiie Partnership's
receipt of such certified audit.
b. Any sums advanced by KA' s affiliate pursuant to the terms of this
Agreement shall be recovered or repaid to KA' s affiliate in
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accordance with the provisions of the Joint Development Agreement.
4. Additional Capital Contributions of KA. In the event the Partnership
determines (i ) that additiona.l capital over and above the.Two Hundred Thousand
(�200,000) Dollars referred to hereinbefore is required for the purpose of .
capital improvements or to defray operating losses of the Partnership and
(ii ) Unidale is unable to advance forty-nine (49%) percent of such additional
operating capital within thirty (30) days after written request therefore by
the Partnership, KA shall have the option to cause its affiliate to contribute
one hundred (100°6) percent of the additional operating capital required. In
such event, Help and Unidale agree that KA's affiliate 's ownership percentage
of the Partnership shall be increased and adjusted in .accordance with the
following ratio: an increase of three and nine-tenths (3.9h) pe►-cent of the
total partnership for each Ten Thousand (�10,000) Dollars of additional capital
advanced by KA' s affiliate of the One Hundred Thousand -($100,G00) pollars with a
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resulting total increase of KA' s affiliate's Partnership ownership percentage
of up to thirty-nine (39%) per•cent, and a corresponding decrease of Unidale's
Partnership ownership percentage. •
UnidaTe shall have the option to repurchase at any time any Partnership
ownership percentage so acquired by KA's affiliate by reimbursing KA's affi'liate
in an amount equal to forty-nine (49�) percent of the additi:onal capital con-
tributed by KA's affiliate, with th� percentage of ownership repurchased com-
puted in the same manner as transferred to KA's affiliate under this provision.
5. Governin9 A9reement. To the extent the Community Development Block
Grant Program Agreement ,is modified, amended, or supplemented by the terms and
conditions of this Agreement, the terms and conditions of this Agreement shall
in all respects supersede, _govern and control . Un.less specifically_ provided
for herein,, the remaining terms and conditions of the Community Devel.opment
Block Grant Program Agreement shall remain in full force and effect.
Similarly, to the extent the Joint Development Agreement hy and between
!CA and f�elp is modified,. amended, or supplemented by the terms and conditions
of this Agreement, the terms and conditions of this Agreement shall in all
respects supersede, govern and control . Unless specifically provided for herein,
� the remaining terms and conditions of the Joint Development Agreement shall
remain in full force and effect.
IN WIT"aESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
APPROVED AS TO FORP1: CITY OF SAIP�T PAUL, P1IP�NESOTA
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By
����- C orney � � �
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HELP ENCOURAaE LOCAL PROGRESS IN
In the Presence of: THE . IT-UNIVERSITY AREA; IPJC.
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In the Presence of: UNI . LE EVELOPMEN CORPORATION
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In the P -e-s.�nce of: KRAUS-ANDER�ON OF ST. PAIJt CO. .
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In the Presence of: ST.- PAUL HOUS ID REDEVELOPMENT
AUTHORITY
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