ASSIGNMENT, ASSUMPTION AND AMENDMENT
OF DEVELOPMENT CONTRACT
THIS AGREEMENT is made and entered into this 21st day of April, 1997, by
and among the CITY OF BELLE PLAINE, MINNESOTA, a Minnesota municipal
corporation (the "City"), the BELLE PLAINE ECONOMIC DEVELOPMENT AUTHORITY,
BELLE PLAINE, MINNESOTA, a Minnesota public body corporate and politic (the
"Authority"), EXCELSIOR-XXXXXXXXX MOTORCYCLE MANUFACTURING COMPANY, a
Minnesota corporation (the "Company"), and RYAN BELLE PLAINE, LLC, a
Minnesota limited liability company ("Xxxx").
RECITALS
A. The City, the Authority and the Company entered into a Contract for
Private Development dated December 31, 1996 (the "Development Contract"),
pertaining to the development of a motorcycle manufacturing facility on the
property located in the City which is described in Exhibit 1 attached hereto.
The Development Contract was recorded in the office of the Xxxxx County
Recorder as Document No. 385970.
B. The Company wishes to assign the Development Contract to Xxxx, which
will construct and own such facility and lease it to the Company.
C. The parties also wish to amend the Development Contract in certain
respects.
D. Capitalized terms which are used but not defined herein have the
meanings ascribed to them in the Development Contract.
AGREEMENT
NOW THEREFORE, in consideration of the mutual terms and provisions of
this Agreement, the parties hereby agree as follows:
1. ASSIGNMENT AND ASSUMPTION. The Company hereby assigns and transfers
unto Xxxx all of its rights and interests as the Developer under the
Development Contract. Xxxx hereby accepts such assignment and assumes and
agrees to keep and perform all of the obligations of the Developer under the
Development Contract to be performed subsequent to the date hereof, except
that Xxxx does not assume, and the Company shall remain solely liable for,
the obligations of the Developer under Sections 3.9 and 6.4 of the
Development Contract (the "Company Obligations"). The City and the Authority
hereby consent to such assignment and agree that, except as provided in
Section 2 hereof, only the Company, and not Xxxx or its successors or
assigns, shall be liable for the payment and performance of the Company
Obligations. The City and the Authority hereby release the Company from
liability for the performance of the obligations of the Developer under the
Development Contract to be performed subsequent to the date hereof, except
the Company Obligations. If after issuance of a Certificate of Completion for
the Minimum Improvements, the Company assigns its leasehold interest in the
Development Property, the City and the Authority will release the Company
from further liability for the Company Obligations provided that the assignee
agrees to assume the
same. The City and the Authority acknowledge that they have approved the
leasing of the Development Property to the Company and that nothing in the
Development Contract prohibits or limits the Company's ability to assign,
sublet or transfer its leasehold interest, whether before or after the
issuance of a Certificate of Completion for the Minimum Improvements;
provided that before issuance of the Certificate of Completion, no such
assignment by the Company shall release the Company from the Company
Obligations unless such release is approved by the Authority and the City in
accordance with Section 8.2(b) of the Development Contract.
2. LIMITED TAX INCREMENT GUARANTY BY XXXX. Notwithstanding the
provisions to the contrary contained in Section 1 hereof, if the lease of the
Minimum Improvements by Xxxx to the Company is hereafter terminated and the
Minimum Improvements are thereafter leased to a party other than the Company
(whether or not the lessee occupies such property) or are occupied by a party
other than the Company, then Xxxx shall become liable for the obligations of
the Developer under Section 6.4 of the Development Contract to the following
extent. If on the date which is 10 days prior to any semi-annual scheduled
payment date for principal or interest on the TIF Bonds the Minimum
Improvements are fully leased to or occupied by a party or parties other than
the Company (including, without limitation, Xxxx), then Xxxx shall be liable
for and shall pay to the Authority the full amount of any deficiency in Tax
Increment or Additional City and County Taxes necessary to make such
semi-annual principal or interest payment. If the Minimum Improvements are
partially leased to or occupied by a party or parties other than the Company
on any such date, then Xxxx shall only be liable for that part of the
deficiency that bears the same ratio to the total amount thereof as the
amount of leased or occupied square feet of space in the Minimum Improvements
bears to the total number of square feet of space therein. For the purposes
of this Section 2, the Minimum Improvements or any portion thereof will be
deemed "occupied" by a party (including, without limitation, Xxxx) if the
party uses the Minimum Improvements or portion thereof in connection with
any trade or business, including, without limitation, manufacturing,
warehousing, distribution, office or any commercial use. The obligations of
Xxxx under this Section 2 shall run with the land and be binding upon all
future owners of the Development Property. However, Xxxx and each future
owner shall only be liable for those obligations hereunder which arise during
their respective periods of ownership. The Authority agrees that the Company
shall have no liability under Section 6.4 of the Development Contract with
respect to the amounts which are payable by Xxxx pursuant to this Section 2.
3. AMENDMENTS. The Development Contract shall be and hereby is amended
as follows:
(a) In paragraph 3.2(a), clause (2) is deleted in its entirety, and the
following clause is substituted in place thereof: "(2) The
conditions precedent to issuance of the Taxable TIF Bonds described
in Section 3.7(b) hereof, except for the closing on Developer's
financing, have been satisfied; and". Also, the last sentence of
paragraph 3.2(a) is deleted in its entirety, and the following
sentence is substituted in place thereof: "Provided that all
conditions specified in this Section 3.2(a) have been satisfied, the
closing of the conveyance of the Development Property from the
Authority to the Developer shall occur on such date as Developer may
elect by giving not less than five (5) days' prior written notice to
the Authority, or such other date as the Authority and the Developer
agree upon in writing."
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(b) The following paragraph is added to Section 3.5:
"(e) If the Developer requests the City to give the
Commencement Notice described in the Public Improvements
Agreement prior to the closing on its construction financing
for the Minimum Improvements, then it will pay all amounts
which become payable by the City pursuant to the terms of the
Public Improvements Agreement prior to such closing. Within
ten (10) days after such closing, the City will reimburse the
Developer for all amounts so paid."
(c) Paragraphs 3.7(c) and (d) are deleted in their entirety, and in
place thereof is substituted the following:
"(c) The Developer agrees that, upon closing of the conveyance
of the Development Property to Developer, it will pay the
amount owing to Seller under the Purchase Money Note. The net
proceeds of the Taxable TIF Bonds shall be allocated to
reimburse Developer for costs of acquiring the Development
Property in the amount of $590,000 (including $100,000 paid by
the Developer as xxxxxxx money under the Letter Agreement and
$490,000 paid by the Developer to satisfy the Purchase Money
Note) and to reimburse the Developer for its Site Improvement
Costs documented in accordance with Section 3.6 hereof,
together with other closing costs paid by Developer under
Section 3.1(c) hereof, in the amount of $1,100,000 for a total
reimbursement of $1,690,000 (the "Reimbursement Amount").
(d) Upon the closing of the sale of the Taxable TIF Bonds, the
Reimbursement Amount shall be placed in escrow with a third
party and disbursed to reimburse the Developer for its costs
in acquiring the Development Property and its documented costs
incurred in constructing the Site Improvements, together with
other closing costs paid by Developer under Section 3.1(c)
hereof; provided, however, that before such escrowed funds are
released the Developer shall first have paid from its separate
equity funds at least $1,450,000 of other costs in
constructing the Minimum Improvements."
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(d) Paragraph 3.7(e) is revised to read as follows:
"(e) The City and the Authority warrant and represent
that the TIF Bonds shall have a final stated maturity
of not later than February 1, 2015, and shall mature
and be payable in such manner as shall provide
approximately level debt service thereon for the years
2000 through 2008."
(e) The following sentence is added to Paragraph 3.7(f):
"However, for so long as Excelsior-Xxxxxxxxx Motorcycle
Manufacturing Company is the lessee of the Development
Property, no such financing shall be provided without its
approval."
(f) The following clause is added at the end of Section 5.2: ", or under
any mortgage covering all or any part of the Development Property
which is granted subsequent to the issuance of a Certificate of
Completion for the Minimum Improvements."
(g) The first paragraph of Section 7.3 is modified to read as follows:
"Section 7.3. SUBORDINATION AND MODIFICATION FOR THE BENEFIT
OF MORTGAGEE. In order to facilitate the Developer obtaining
financing for purchase of the Development Property and for
construction according to the Construction Plans, the
Authority agrees to subordinate all of its rights under this
Agreement including, but not limited to Section 9.3 herein, to
the Holder of the Mortgage and any mortgage covering all or
any part of the Development Property that is granted
subsequent to the issuance of a Certificate of Completion for
the Minimum Improvements, provided the Development Property
remains subject to the Assessment Agreement, which shall be
prior to and not subordinate to the Mortgage and any
subsequent mortgage, and further provided that the
subordination of the Authority's rights under this Agreement
shall be subject to such reasonable terms and conditions as
the Authority and Holder of a Mortgage or mortgagee under any
subsequent mortgage mutually agree in writing."
(h) The following sentence is added at the end of Section 9.1:
"Any such notice of default will also be given by the
Authority or City to Excelsior-Xxxxxxxxx Motorcycle
Manufacturing Company, and it shall have the same opportunity
to cure the default as is afforded to the
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Developer hereunder before an Event of Default shall exist."
(i) Paragraph 10.6(a) is deleted in its entirety, and in place thereof
is substituted the following:
"(a) in the case of Developer, is addressed to or delivered
personally to the Developer at 700 International Centre, 000
Xxxxxx Xxxxxx Xxxxx, Xxxxxxxxxxx, XX 00000; Attn: Xxxxxxx X.
Xxxx; with a copy to Excelsior-Xxxxxxxxx Motorcycle
Manufacturing Company; and"
The following is added as Paragraph 10.6(c):
"(c) in the case of Excelsior-Xxxxxxxxx Motorcycle
Manufacturing Company, is addressed to or delivered
personally to it at 000 Xxxx Xxxxxxxx'x Xxxxx, Xxxxxxxxxx,
Xxxxxxxxx 00000; Attn: Xxx Xxxxxx."
(j) The following sentence is added to the end of Section 10.10:
"So long as the lease of the Development Property to it is
in effect, any amendment must also be executed by
Excelsior-Xxxxxxxxx Motorcycle Manufacturing Company."
(k) The first paragraph of Section 1 of the Limited Warranty Deed which
is attached as Schedule B is modified to read as follows:
"It is understood and agreed that this Deed is subject to
the covenants, conditions, restrictions and provisions of
an agreement entered into between the City of Belle Plaine,
Minnesota (the "City"), Grantor and Excelsior-Xxxxxxxxx
Motorcycle Manufacturing ("Excelsior-Xxxxxxxxx") on the
31st day of December, 1996, and filed in the office of
Xxxxx County Recorder on January 10, 1997 as Document
No. 385970, identified as "Contract for Private
Development," which agreement was assigned by
Excelsior-Xxxxxxxxx to Grantee and modified in certain
respects by that certain Assignment, Assumption and
Amendment of Development Contract entered into by the City,
Grantor, Excelsior-Xxxxxxxxx and Grantee, dated as of
____________, 1997, and filed in the office of the Xxxxx
County Recorder on ______________, 1997 as Document
No. _______, hereafter identified as the "Assignment"
(hereinafter, the term "Agreement" refers to the Contract
for Private Development as
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assigned and modified by the Assignment), and that the
Grantee shall not convey this Property, or any part
thereof, except as permitted by the Agreement until a
certificate of completion releasing the Grantee from
certain obligations of said Agreement as to this Property,
or such part thereof then to be conveyed, has been placed
of record. This provision, however, shall in no way prevent
the Grantee from mortgaging this Property in order to
obtain funds for the purchase of the Property hereby
conveyed or for erecting improvements thereon in conformity
with the Agreement, any applicable development program and
applicable provisions of the zoning ordinance of the City
of Belle Plaine, Minnesota, or for the refinancing of the
same."
(l) Paragraph (c) of Section 3 of the Limited Warranty Deed which is
attached as Schedule B is modified to read as follows:
"(c) Comply with the provisions of Sections 5.1, 6.1 and
6.2 of the Agreement relating to insurance coverage, the
timely payment of real property taxes and the
maintenance of taxable status, and the provisions of
Section 2 of the Assignment relating to payment of tax
increment deficiencies."
(m) Notwithstanding anything to the contrary in Section 3.4(c), the
Authority shall cause the Petition for Public Improvements and Waiver of
Special Assessment Appeal to be terminated and discharged of record to
the reasonable satisfaction of the Developer upon the later of the
delivery of the Deed to the Developer or satisfaction of all conditions
precedent to issuance of the Taxable TIF Bonds described in
Section 3.7(b).
Except as so amended, the Development Contract is and shall remain in full
force and effect in accordance with its terms.
4. APPROVALS. The Authority acknowledges that it has approved evidence
of financing sufficient for the construction of the Minimum Improvements as
required by Section 7.1 of the Development Contract, consisting of the
$5,750,000 loan commitment issued by Xxxxx & Xxxxx to Xxxx Companies US,
Inc., dated February 10, 1997, and the agreement of the Company to contribute
at least the sum of $1,450,000 to the costs of construction thereof. The
Authority further acknowledges that it has approved the Construction Plans
for the Minimum Improvements, which are described on Exhibit 2 attached hereto.
5. BINDING EFFECT. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors
and assigns.
6. GUARANTY. Upon execution of this Agreement, and as a condition of
the approval thereof by the Authority and the City, Xxxx shall cause to be
delivered to the City and Authority a Corporate Guaranty Agreement by Xxxx
Companies US, Inc. in substantially the form attached hereto as Exhibit 3.
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7. LETTER AGREEMENT. The terms and provisions contained in the letter
agreement dated April 15, 1997, by the Company and Xxxx to the Authority and
the City, a copy of which is attached hereto as Exhibit 4, are hereby
incorporated herein and made a part hereof.
-6(a)-
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
CITY OF BELLE PLAINE, MINNESOTA
By /s/ XXXXXX X. XXXXX
-------------------------------------
Its Mayor
And /s/ XXXXX X. XXXXXXX
------------------------------------
Its City Administrator
BELLE PLAINE ECONOMIC DEVELOPMENT
AUTHORITY, BELLE PLAINE, MINNESOTA
By /s/ XXXX X. XXXX
-------------------------------------
Its President
And /s/ XXXXXX X. XXXXX
------------------------------------
Its Executive Director
EXCELSIOR-XXXXXXXXX MOTORCYCLE
MANUFACTURING COMPANY
By /s/ XXXXXX X. XXXXXXXX
-------------------------------------
Its Chief Financial Officer
RYAN BELLE PLAINE, LLC
By /s/ XXXXXXX X. XXXX
-------------------------------------
Its Chief Manager
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STATE OF MINNESOTA )
) ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this 15 day of
April, 1997, by Xxxxxx X. Xxxxx the Mayor, and Xxxxx X. Xxxxxxx the City
Administrator, of the CITY OF BELLE PLAINE, MINNESOTA, a Minnesota municipal
corporation, on behalf of said municipal corporation.
/s/ XXXXXXXX X. XXXXXX
---------------------------------------
Notary Public
[SEAL]
STATE OF MINNESOTA )
) ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this 15 day of
April, 1997, by Xxxx X. Xxxx the President, and Xxxxxx X. Xxxxx the Executive
Director, of the BELLE PLAINE ECONOMIC DEVELOPMENT AUTHORITY, BELLE PLAINE,
MINNESOTA, a Minnesota public body corporate and politic, on behalf of said
body.
/s/ XXXXXXXX X. XXXXXX
---------------------------------------
Notary Public
[SEAL]
STATE OF MINNESOTA )
) ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this 21st day of
April, 1997, by Xxxxxx X. Xxxxxxxx the Chief Financial Officer of
EXCELSIOR-XXXXXXXXX MOTORCYCLE MANUFACTURING COMPANY, a Minnesota
corporation, on behalf of said corporation.
/s/ XXXXX X. XXXXXXXX
---------------------------------------
Notary Public
[SEAL]
8
STATE OF MINNESOTA )
) ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this 21st day of
April, 1997, by Xxxxxxx X. Xxxx the Chief Manager of RYAN BELLE PLAINE, LLC,
a Minnesota limited liability company, on behalf of said limited liability
company.
/s/ XXXXX XXXXXXXXXX
---------------------------------------
Notary Public
[SEAL]
THIS INSTRUMENT WAS DRAFTED BY:
Xxxxxx Xxxxxxx, Esq.
Xxxx Companies US, Inc.
000 Xxxxxxxxxxxxx Xxxxxx
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000-0000
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