1988-08-11 Development Agreement
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CITY OF ALBERTVILLE
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P. O. BOX 131
ALBERTVILLE, MINNESOTA 55301
PHONE: (612) 497-3384
DEVELOPER'S AGREEMENT
BRAUN'S ADDITION
THIS AGREEMENT, entered into this 11th day of August, 1988 by and
between Braun Development, Inc., referred to herein as "Developer";
and the CITY OF ALBERTVILLE, in the County of Wright, State of
Minnesota, hereinafter referred to as "City";
WITNESSETH:
WHEREAS, Developer is the fee owner and developer of a parcel or
parcels of land described in Exhibit "A", attached hereto and
incorporated herein by reference which parcel or parcels of land are
proposed to developed as a subdivision in the City, and which
subdivision is intended to bear the name Braun's Addition and may
sometimes hereinafter be referred to as the "Subject Property" or
"Said Plat"; and
WHEREAS, the City has given final approval of Developer's plat of
Braun's Addition contingent upon compliance with certain City
requirements including,but not limited to, matters set forth herein;
and
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Make our City. . . . . . . . Your City
We invite Home, Industry, Business
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WUEREAS, the City requires that certain public improvements,
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which are herein referred to as "Petition Items" including, but not
limited to, sanitary sewer, water, storm sewer and streets be
installed to serve the Subject Property and other properties affected
by the development of Developer's land, all at the expense of
Developer; and
WHEREAS, the City further requires that certain on and off-site
improvements be installed by the Developer, within the Subject
Property, which improvements typically consist of boulevard sod,
bituminous
signs, and
the Subject
and
or concrete driveway approaches, drainage swales, street
front yard trees and like items and which improvements to
Property shall be referred to herein as "Escrow Items";
WHEREAS, this Agreement is entered into for the purpose of
setting forth and memorializing for the parties and subsequent owners
the understandings and agreements of the parties concerning the
development of the Subject Properties;
NOW THEREFORE, IT IS HEREBY AND HEREIN MUTUALLY AGREED, in
consideration of each party's promise and considerations herein set
forth, as follows:
1. PETITION FOR IMPROVEMENTS (PETITIONS ITEMS). Developer herein
petitions the City to construct as part of the City's Improvement
Project(s) 1988-3A and/or other City project deemed appropriate by the
City the improvements referred to in Exhibit "B" and described therein
in very generalized language as "Petition Items", Said Exhibit "B" is
attached hereto and incorporated herein by reference as though fully
set forth.
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2" WAIVER. Developer waives all right to a public hearing and
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other statutory rights granted to a property owner under Chapter 429
of Minnesota Statutes as the said rights therein granted related to
Petition Items, including those that are a part of Project(s) 1988-3A,
as set forth in Exhibit "B",
3. PETITION ITEMS PROJECT(S) 1988-3 The City shall
construct as part of its City Improvement Project(s) 1988-3A at its
discretion all or a portion of the Petition Items as shown on Exhibit
"B" pursuant to its regular methods of making public improvements. The
Developer agrees that special assessments for said improvements may be
levied by the City, without Developer's objection, after construction
is commenced, Thereafter the expense incurred or to be incurred in
making the improvement shall be calculated under the direction of the
Council. The Developer further agrees that the City may recover its
costs and expenses including legal, fiscal, administrative and
engineering); by levy of said special assessments to be payable in
equal principal installments together with interest thereon from the
date of the resolution levying the assessment as determined by the
City over a period of not more than twelve (12) years.
4. PETITION ITEMS - SURETY. It is anticipated that of City's debt
service each year during the stated assessment period for the
installation of the Petition Items as shown in Exhibit "B", the
portion of which benefits the Subject Property will require an
estimated payment(s) from the City to its bondholders amounts as
indicated on Exhibits "C" attached hereto. It is intended that
Developer shall make sufficient payments of said special assessments
that the City's cash flow will be unaffected by said improvement
project(s) .
Developer herein agrees that said Developer will actually pay
sufficient amounts of said special assessments each year, if not
already paid in prior year, for properties lying within said plat to
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enable the City to pay the required debt service payment shown on
Exhibit "C" when due. To determine the actual amount, as opposed to
the estimated amount, to be paid by the Developer, the principal
amount shall be added to the interest amount, for the subject
improvement project(s), as shown on the tax statements for lots lying
within Said Plat, less credit for prepayments made thereof. Any
deficiencies in the amount paid by the Developer for special
assessments causing a shortage of funds with which the City may timely
pay the required debt service payment(s) shall be supplemented with
funds withdrawn by the City from the Developer's approved letter of
credit or other surety furnished to the City. Any of said surety or
guaranty of funds referred to herein that are withdrawn will be used
by the City for payment of its herein referred debt service payment
when due. Upon the Developer paying the delinquent special
assessments, the City will repay to the surety, to the extent that the
delinquent special assessments have been paid, the surety monies
withdrawn, less any costs incurred by the City in conjunction with the
said delinquent special assessments.
The Developer shall provide the City with cash, approved letter
of credit or other satisfactory surety in the amount of 30% of the
estimated cost of Petition Item improvements which are to be
constructed as part of Project(s) 1988-3A. The developer's cash, bond,
letter of credit or other surety shall thus be in the
amount of $46,000.00, calculated as follows:
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,. Total Estimated Cost of Braun's $154,566.91
Addition
Plat Petition Items included in
Project(s) 1988-3A X 30%
Surety Requirement: $ 46,370.07
USE: $ 46,000.00
The said 30% surety is the guarantee referred to earlier in this
paragraph that sufficient revenue is annually produced by the payment
of special assessments to enable the City to pay the required debt
service payment, which debt service payment relates to the portion of
Project(s) 1988-3A benefitting the development of the Said Plat. The
City may draw on said surety for cash flow purposes to supplement the
Developer's payments when Developer is delinquent in the payment of
said special assessments.
5. ON AND OFF-SITE IMPROVEMENTS/ESCROW ITEMS: SURETY.
A. Developer shall perform all on and off-site improvements set
forth on Exhibit "B" as "Escrow Items". Developer will provide the
City with cash, approved letter of credit or other satisfactory surety
in the sum of $10,120.00, which figure represents 110% of the
estimated cost of said Escrow Items. The said surety shall be a
guaranty to the City that with the exception of boulevard improvements
(sods, trees, driveways approaches) the construction and completion of
the escrow items by the Developer, to the City's satisfaction, will be
completed on or before October 1, 1988. The boulevard improvements for
each lot or parcel shall be completed to the City's satisfaction
within sixty (60) days of the date that a certificate of occupancy
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(~emporary or permanent) is issued by the City for a building located
on the lot; unless the certificate of occupancy is issued after
October 1st and before March 30th in any given year, in which case the
boulevard improvements shall be so completed by the following June
1st. At the City's option it may install the street sign(s) and bill
the direct cost of materials and installation to the Developer who
will pay the bill within 10 days of the billing. The said cash,
letter of credit or other surety shall be released upon certification
of the Engineer of the City that such items are satisfactorily
completed pursuant to this agreement. Periodically, as payments are
made by the Developer for the completion of portions of the items
described under "Escrow Items" and when it is reasonably prudent, the
Developer may request of the City that the surety be reduced for that
portion of the project which has been fully completed and payment made
therefor. The City's cost for processing reduction request(s) shall be
billed to the Developer at the rate of $30.00 per hour with a minimum
of one (1) hour per reduction and shall be paid to the City within ten
(10) days of the date of mailing the billing.
6. SURETY RELEASE - PETITION ITEMS. The developer may request of
the City a reduction or release of any surety provided for in
conjunction with the Petition Items as shown on Exhibit "B" as
follows:
A. When another acceptable surety is furnished to the City to
replace a a prior surety.
B. When the final cost amount minus previous payments becomes
less than the surety provided, thus allowing the surety to be reduced
to a sum commensurate with the remaining debt service obligation.
C. No reduction shall be made which would result in the surety
held being less that 35% of the original surety for petition items
until the final costs are known and assessed.
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D.. The surety will be released at such time as special
assessments for 75% of the lots in Said Plat have peen paid in full.
The City's cost for processing said reduction request shall be
billed at $30.00 per hour with a minimum of one (1) hour per
reduction, and shall be billed to the developer and paid to the City
within ten (10) days thereof.
7. SURETY DEFICIENCY. In the event that any cash, letter of
credit or other surety referred to herein is ever utilized and found
to be deficient in amount to payor reimburse the City in total as
required herein, the Developer agrees that upon being billed by the
City, Developer will pay within ten (10) days of the mailing of said
billing, the said deficient amount. If there should be an overage in
the amount of utilized security the City will. upon making said
determination, refund to the Developer any monies which the City has
in its possession which are in excess of the actual costs of the
project as paid by the City. All monies deposited with the City shall
be used by the City at the City's discretion to defray the City's
costs and expenses with the project(s) referred to herein.
8. ABANDONMENT OF PROJECT COSTS AND EXPENSES. In the event
Developer should abandon the proposed development of the Subject
Property, the City's costs and expenses for the preparation of the
feasibility report, plans and specifications and all other costs
expended by the City which are associated with Project(s) 1988-3A
shall be paid by said Developer. The Developer has provided cash
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sureties to the City as follows:
PURPOSE
AMOUNT
Cost associated with Preparation
of Feasibility Report:
Cost associated with Preparation
of Plans and Specifications:
$1 . 500 . 00
+ $4.500.00
TOTAL
$6.000.00
The City may withdraw funds from the above-referred escrow for the
purpose of paying the costs referred to in this paragraph. The said
cash escrow funds will be released by the City upon the Developer
providing satisfactory sureties for the Petition Items referred to in
Exhibit "B".
9. DEVELOPER TO PAY ALL COSTS. It is understood and agreed that
amounts set forth in this Agreement as improvement costs. unless
specifically specified as fixed amounts. are estimated. The Developer
agrees to pay the entire cost of the improvement including interest.
fiscal. engineering. legal and administrative charges.
10. EROSION AND SILTATION CONTROL.
A. FINANCIAL GUARANTEE. Before any grading is started on any
site, all erosion control measures as shown on the approved erosion
control plan shall be installed. In addition. a financial guarantee
shall be provided to the City to insure compliance during
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c9nstruction. This financial guarantee, which is included as an Escrow
Item in Exhibit "B", will not be returned until all disturbed areas
have permanent vegetation re-established.
B. EROSION CONTROL.
(THIS SPACE WAS INTENTIONALLY LEFT BLANK)
11. PARK DEDICATION.
The Developer shall fulfill park dedication of the Albertville
City Ordinance 1987-2 and the Albertville Park and Recreation Board by
the payment of cash in the sum of $3,910.00 shall be paid prior to the
plat being released for filing at the Wright County Courthouse. The
Developer's performance of its obligation shall be secured by the
sureties described in paragraphs 4 and 5 above, which sureties shall
not be released or reduced until fulfillment of the obligation in this
paragraph are met.
12. PAYMENT OF SPECIAL ASSESSMENTS UPON SALE. It is further the
agreement of the parties that all special assessments levied on City
Project(s) 1988-3A or any other city project previously levied, or to
be levied as a part of activating previously deferred assessments
against the Subject Property, or portion thereof, if not paid prior
thereto, shall be paid by the Developer on the sale or transfer of any
fee ownership interest in the Subject Property; provided however, that
if the seller grants seller financing in an amount not less than the
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total. of the unpaid assessments levied or pending against the lot,
then the payment of the special assessments can be delayed as long as
the amount remaining financed by the developer is greater than the
total of the said unpaid levied or pending special assessments, but in
all events no later than the date the security of the sellers
financing is released or satisfied. If only a portion of the Subject
Property is transferred, Developer shall pay the said special
assessments attributable only to that portion which is being sold or
transferred.
In the event the Developer wishes to have the final costs for
Project(s) 1988-3A determined for the purpose of conveying a lot or a
number of lots prior to completion of the project, Developer shall
provide to the City a cash payment in an amount equal to one hundred
percent (100%) of the estimated special assessments for each of the
lots that the Developer seeks to convey. The surety deposit made by
the Developer for Petition Items pursuant to this agreement shall be
retained in full until the final project costs and results of the
assessments are determined. The City, upon receipt of said payment for
a particular lot or lots will upon request then certify within any
special assessment search relating to said lot or lots have been fully
assessed for sald Project, pursuant to this Developer's Agreement; and
that no further assessments will be made to said lot or lots for the
improvements comprehended or being constructed under Project(s)
1988-3A. After determination of the final cost of the project and the
resulting assessment therefor, any overage paid by the Developer will
be returned to the Developer, and if there should be any shortage in
the amount paid, the Developer will immediately pay the City the
difference between the amount previously paid and the amount of the
assessments for the particular lots or lots. Payment shall be made
within thirty (30) days of the billing. The City may draw upon any
surety deposit made by the Developer if the Developer fails to pay the
billed amount within thirty (30) days of said bill.
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13. MAINTAIN PUBLIC PROPERTY DAMAGED OR CLUTTER DURING
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CONSTRUCTION. Developer agrees to assume full financial responsibility
for any damage which may occur to public property including but not
limited to streets. street sub-base. base. bituminous surface. curb.
utility system including but not limited to water main. sanitary sewer
or storm sewer when said damage occurs as a result of the activity
which takes place during the development of Said Plat. The Developer
further agrees to pay all costs required to repair the streets and/or
utility systems damaged or cluttered with debris when occurring as a
direct or indirect result of the construction that takes place in Said
Plat. In the event the Developer fails to maintain or repair the
damage public property referred to aforesaid. the City may undertake
making or causing it to be repaired or maintained. When the City
undertakes such repair. the Developer shall reimburse the City for all
of its expenses within ten (10) days of its billing to the Developer.
If the Developer fails to pay said bill within thirty (30) days. the
surety shall be responsible for reimbursing the City therefor.
14. STREET SECTION GRADING. While the development site is being
graded by Developer. an independent testing firm. approved by the
City. shall test the street section of those parts of streets platted
in Said Plat designated by the City Engineer. so as to certify to the
City that the contractor is achieving 95% of the standard moisture
density relationship of soils with exception of the top three (3) feet
of the street section shall be compacted to 100% density. Fees paid to
said independent testing firm shall be paid by the Developer. The
City's Engineer shall be furnished. either directly by the testing
firm or by the Developer. a copy of the test results.
15. TEMPORARY EASEMENT RIGHTS TO
Developer by signing this Agreement. gives
all of the Subject Property to install the
INSTALL IMPROVEMENTS. The
the City right of access on
contemplated utility and
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s~ree~' improvements referred to herein. It is anticipated
Developer will file the plat of Braun's Addition on or before
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1988, which plat will permanently provide right-of-way
required streets and utilities.
that the
June 30,
for the
16. MISCELLANEOUS.
(THIS SPACE WAS INTENTIONALLY LEFT BLANK.)
17. DRAW ON EXPIRING LETTER OF CREDIT. In the event a surety or
other form of guarantee referred to herein is in the form of an
irrevocable letter of credit, which by its terms will become null and
void prior to the time at which all money or obligation of the
Developer is paid or completed, it is agreed that the Developer shall
provide the City with a new letter of credit or other surety,
acceptable to the City, at least forty-five (45) days prior to the
expiration of the said expiring letter of credit. If a new letter of
credit is not received as required above, the City may declare a
default in the terms of this Agreement and thence draw in part or in
total, at the City's discretion, upon the expiring letter of credit to
avoid the loss of surety for the continued obligation.
18. VIOLATION OF AGREEMENT. In the case of a default by the
Developer, it successors or assigns, of any of the covenants and
agreements herein contained, the City shall give the Developer 30 days
mailed notice thereof and if such default is not cured within said 30
day period, the City is hereby granted the right and privileges to
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declare all of the sums levied as special assessments or otherwise and
any deficiencies governed by this Agreement due and payable to the
City in full. The 30 day notice period shall be deemed to run from the
date of deposit in the United State's mails. The City may thence
immediately and without notice or consent of the Developer use all of
the deposited escrow funds, letters of credit or other surety funds to
complete the Developer's obligations as set forth herein, whether
related to Escrow Items or Petition Items, and to bring legal action
against the Developer to collect any sums due to City pursuant to this
Agreement.
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19. ATTORNEY'S FEES. The Developer will pay the City reasonable
attorney's fees to be fixed by the Court in the event a suit or action
is brought to enforce the terms of this Agreement or in the event an
action is brought upon a bond or letter of credit furnished by the
Developer as provided herein.
20. NOTIFICATION INFORMATION. Any notices to the parties herein
shall be by registered mail addressed as follows:
CITY OF ALBERTVILLE
c/o City Administrator/Clerk
P.O. Box 131
Albertville, MN 55301
Telephone: (612) 497-3384
BRAUN DEVELOPMENT, INC.
% Robert Braun. President
11571 57th Street
Albertville. MN 55301
Telephone: (612) 497-3401
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STATE OF MINNESOTA)
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COUNTY OF WRIGHT )
The foregoing instrument was acknowledged before me this
day of ~~~r ,19~~ by Loretta Roden the Mayor and by
Maureen Andrews, the Administrator/Clerk of the City of Albertville, a
municipal corporation under the laws of Minnesota, on behalf of said
corporation.
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Notary Public, Wright County, MN
My Commission expires: \~J \ 1Q.'d.
I I
FERN A. BOYER
NO~ARY PUBLIC - MINN~S()rJ\
WRIGHT COUNty
My commisSion expires 12-1-92
STATE OF MINNESOTA)
)
COUNTY OF WRIGHT )
The foregoing instrument was acknowledged before me this
day of -1~. , 19 ~'i by Robert Braun, President
William Braun, Secretary, the Officers of Braun Development,
general corporation under the laws of Minnesota, on behalf
general partnership.
,clr
and by
Inc., a
of said
,.
~\sw (j,~~1\()
Notary Public, Wright County, MN
My Commission expires: \ ~ I \ /o.'d..
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FERN A. BOYER !
I
1ol0~ARY PUBLIC - MINNESOTA ,
WRIGHT COUNTY . I
';y co~misslon expires 12-1-92 t
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EXHIBIT "A"
Legal Description for
BRAUN'S ADDITION
That part of Lot C and that part of Lot D of the West Half
of the Southeast Quarter of Section 1. Township 120, Range 24.
according to the plat thereof made by H.T. Moland. and on file in the
Office of the County Recorder in Book 2 of Plats on Page 91. Wright
county. Minnesota. described as follows: Beginning at the southwest
corner of said Lot D; thence on an assumed bearing of N 1 59' 37" E.
along the west line of said Lot D and said Lot C. a distance of 544.51
feet; thence S 87 11' 16" E. a distance of 173.00 feet; thence
S 1 59' 377 W. a distance of 223.02 feet; thence S 86 56' 30" E, a
distance of 214.00 feet; thence N 75 32' 21" E, a distance of 54.71
feet; thence N 54 49' 16" E, a distance of 72.84 feet; thence N
32 01' 30" E. a distance of 168.00 feet; thence S 87 11' 16" E, a
distance of 385.04 feet thence S 2 00' 08" W. a distance of 76.94
feet; thence S 87 59' 52" E, a distance of 163.00 feet, to the east
line of said Lot c; thence S 2 00' 08" W, along the west line of said
Lot C and said Lot D. a distance of 462.00 feet to the southeast
corner of said Lot D; thence N 87 16' 20" W, along the south line of
said Lot D, a distance of 1129.54 feet to the point of beginning.
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EXHIBIT "B"
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WORK PERTAINING TO BRAUN'S ADDITION
I. PETITION ITEMS (Project 1988-4)
A. Street
B. Storm Sewer
C. Sanitary Sewer
D. Watermain
REQUIRED SURETY PERCENTAGE:
II. ESCROW ITEMS
A. Boulevard Improvements
1. Installation boulevard sod.
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USED:
ESTIMATED COST
$ 31,811.82
33,901. 03
26,150.04
62,704.02
$154,566.91
30%
$46,370.07
$46,000.00
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.. 2. Planting of one (1) deciduous front yard tree of type
specified in City Resolution Approving Final Plat for each
lot shall be a minimum of two inches (2") in diameter
measured six inches (6") above the ground.
3. Installation of a bituminous driveway approach
with a minimum of two inches (2") hot mix a.c. on five
inches (5") Class 5 aggregate or a concrete approach
constructed a minimum of four inches (4") thick with wire
or six inches (6") thick without wire mesh.
B. Gradin~ Control.
All site grading, including building sites, ponds and surface
drainage ways shall be graded in accordance with the approved
grading and development plan.
C. Street Si~ns
As designated by the City Engineer as to number and location.
D. Street Cleanin~.
All streets in the area shall be kept free of dirt and debris
during all phases of construction.
SURETY REQUIREMENTS:
If cash or letter of credit is submitted $10,120.00
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KXHIBIT "C"
DKBT SERVICE SCHEDULE
BRAUN'S ADDITION
Debt service based on total estimated project cost of
$154,566.91, 12 year assessment and an estimated 8.75% interest
rate.
YEAR
PRINCIPAL
BALANCE
RE'QUI RED SPEC.
ASSESS. TOT.AL
PAY. BY DEV.
IN TAXES OR
PREPAYMENT
ANNUAL
PRINCIPAL
INTE~EST
DEBT
SERVICE
1989 $154,566.91 $12,880.58 $16,905.76 $29,786.33 $14,893.17
14,893.16
1990 141,686.33 12,880.58 12,397.55 25,278.13 12,639.07
12,639.06
1991 128,805.75 12,880.58 11,270.50 24,151.08 12,075.54
12,075.54
1992 115,925.17 12,880.58 10,143.45 23,024.03 11,512.02
11,512.01
1993 103,044.59 12,880.58 9,016.41 21,896.99 10,948.50
10,948.49
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BY
DATE
5/89
10/89
5/90
10/90
5/91
10/91
5/92
10/92
5/93
10/93
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REQUIRED 'SPEC.
ASSESS. TOTAL
PAY. BY DEV.
PRINCIPAL ANNUAL DEBT IN TAXES OR BY
YEAR BALANCE PRINCIPAL INTEREST SERVICE PREPAYMENT DATE.
1994 $90,164.01 $12,880.58 $7,889.35 $20,769.93 $10,384.97 5/94
10,384.96 10/94
1995 77,283.40 12,880.58 6,762.30 19,642.88 9,821.44 5/95
9,821.44 10/95
1996 64,402.85 12,880.58 5,635.25 18,515.83 9,257.92 5/96
9,257.91 10/96
1997 51,522.27 12,880.58 4,508.20 17,388.78 8,694.39 5/97
8,694.39 10/97
1998 38,641. 69 12,880.58 3,381. 15 16,261. 73 8,130.87 5/98
8,130.86 10/98
1999 25,761.11 12,880.58 2,254.10 15,134.68 7,567.34 5/99
7,567.34 10/99
2000 12,880.53 12,880.53 1,127.05 14,007.58 7,003.79 5/00
7,003.79 10/00
$91,291.07
$245,857.97
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S :e::C'O"'EI:r:r~
STATE BANK of St. Michael
701 CENTRAL AVE. EAST
AND ALBERTVILLE FACILITY
ST. MICHAEL, MINNESOTA 55376
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PHONE
ST. MICHAEL - 497-2131
ALBERTVILLE - 497-3525
IRREVOCABLE STANDBY LETTER OF CREDIT
August 15, 1988
City of Albertville
P.O. Box 131
Albertville, MN 55301
Re: Our Irrevocable Letter of Credit No. 27011
Amount: "'S46,OOO.OO U.S. FundS'
Gentlemen:
We hereby establish, at the request and for the account of Braun
Development, Inc., a Minnesota corporation, in your favor, this
Irrevocable Standby Letter of Credit, numbered as indicated
above, in the amount of and not to exceed Forty-Six Thousand and
No/lOO ($46,000.00) U. S. Funds (the "Stated Amount"), available
by negotiation of your draft or drafts drawn at sight upon
Security State Bank of St. Michael for said amount or less,
effective immediately.
A draft drawn under this Letter of Credit must:
(1) Be signed by the City Administrator of the City of
Albertville;
(2) Bear on its face the clause, "Drawn under Braun
Development, Inc. Irrevocable Standby Letter of Credit
No. 27011, dated August 15, 1988; and
(3) Be accompanied by a Certificate purportedly signed by
the City Administrator of the City of Albertville
stating:
"We are drawing under your Standby Letter of
Credit No. 27011 as Braun Development, Inc. has
failed to complete one or more of the following
construction requirements as set out in the
Developer's Agreement for Braun's Addition. Under
the terms of the Development Agreement dated the
11th day of August, 1988, between the City of
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Albertville and Braun Development, Inc., the City
is entitled to the unreleased portion of this
Standby Letter of Credit to be used to complete
said improvements (indicate all item(s) and check
which item(s) apply to the drawing:
[] (a)
[] (b)
[] (c)
[] (d)
street.
Storm sewer.
Sanitary sewer.
Water main.
(4) Be accompanied by the original Letter of Credit for
endorsement.
Drafts and drawing certificates which otherwise conform to the
terms and conditions hereof shall be deemed to be proper if
presented on or before the appropriate time specified under
SPECIAL CONDITIONS, paragraph 1.
SPECIAL CONDITIONS:
1. Time of Drawings. Demand for payment may be made by
you under this Letter of Credit by original documentation
presented at any time during our business hours at our office
located at 701 Central Avenue East, St. Michael, Minnesota
55376, or our Albertville facility in Albertville, Minnesota, on
any day upon which banks located in the State of Minnesota are
not required or authorized to remain closed (a "business day").
If demand for payment hereunder is received by us at or prior to
12:00 noon on a Business Day, and provided that such demand for
payment in the documents presented therewith conform to the terms
and conditions hereof, we shall authorize the payment to you of
the amount demanded on or before noon on the next Business Day;
if any such demand for payment is received by us after noon on a
Business Day, we shall authorize the payment to you of the amount
demanded on or before noon on the second Business Day thereafter.
2. Methods of Payment. Payments authorized in accordance
with paragraph 1 under SPECIAL CONDITIONS shall be made on the
date of authorization in immediately available funds.
3. Expiration. This Letter of Credit shall expire at the
close of our business hours on August 14, 1989, provided,
however, this Standby Letter of Credit is automatically renewable
for successive one year periods from the present expiration date
unless we notify you by certified mail, addressed to the City of
Albertville, P.O. Box 131, Albertville, Minnesota 55301, thirty
(30) days prior to said expiration date that we elect not to
renew the Letter of Credit for an additional period of one year.
,
~
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Page 3
4. Maximum Amount of Drawing. This Letter of Credit has
been issued pursuant to the Developer's Agreement dated the 11th
day of August, 1988, by and between Braun Development, Inc., as
Developer, and the City of Albertville. The amount which may be
drawn pursuant to this Letter of Credit for particular items are
as follows:
a. For payment of 30% of any special assessments
assessed for street, storm sewer, sanitary sewer
and water main against respective, individual
platted lots which remain outstanding at the time
the draw request is made not exceeding a total
draw of $46,000.00.
b. The Bank shall be entitled (but not required) to
exercise any developer rights granted in the
Development Agreement, including but not limited
to, the reduction and release provisions contained
in Paragraph 6 of the Development Agreement.
GENERAL CONDITIONS:
1. Drawings; Reduction of Stated Amount. Each drawing
hereunder shall reduce by the amount of the drawing the amount
available under this Letter of Credit.
2. Limitation on Obligations. Security State Bank of
st. Michael has no obligation or right to:
a. Inquire into the correctness of any such herein
described certification; or
b. See to the proper application or use by the City
of Albertville of any payments by the Bank to it
under such certification.
3. Transferability.
transferrable.
This Letter of Credit is not
4. Irrevocability. This Letter of Credit is irrevocable.
5. Complete Agreement. This Letter of Credit sets forth
in full the terms of our undertaking. Reference in this Letter
of Credit to other documents or instruments is for identification
purposes only, and such reference shall not modify or affect the
terms hereof or cause such documents or instruments to be deemed
incorporated herein.
.
,
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.
Page 4
6. Governing Regulation. Our rights or our liabilities
and responsibilities are strictly limited in accordance with the
most current revision of Uniform Customs and Practice for
Documentary Credits, 1983 Revision, ICC Publication No. 400,
effective October 1, 1984.
We hereby engage with the drawer that drafts drawn and negotiated
in conformity with the terms of this Letter of Credit will be
duly honored on presentation.
SECURITY STATE BANK OF ST. MICHAEL
By:
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SI A IE BANK of St. Michael
701 CENTRAL AVE. EAST
AND ALBERTVILLE FACILITY
ST. MICHAEL, MINNESOTA 55376
-
.
PHONE
ST. MICHAEL - 497-2131
ALBERTVILLE - 497-3525
IRREVOCABLE STANDBY LETTER OF CREDIT
August 15, 1988
City of Albertville
P.O. Box 131
Albertville, MN 55301
Re: Our Irrevocable Letter of Credit No. 26963
Amount: $10,120.00 U.S. Funda'
Gentlemen:
We hereby establish, at the request and for the account of Braun
Development, Inc., a Minnesota corporation, in your favor, this
Irrevocable Standby Letter of Credit, numbered as indicated
above, in the amount of and not to exceed Ten Thousand
One-Hundred Twenty and NO/100 ($10,120.00) U.S. Funds (the
"Stated Amount"), available by negotiation of your draft or
drafts drawn at sight upon Security State Bank of st. Michael for
said amount or less, effective immediately.
/
A draft drawn under this Letter of Credit must:
(1) Be signed by the City Administrator of the City of
Albertville;
(2) Bear on its face the clause, "Drawn under Braun
Development, Inc. Irrevocable Standby Letter of Credit
No. 26963, dated August 15, 1988; and
(3) Be accompanied by a Certificate purportedly signed by
the City Administrator of the City of Albertville
stating:
"We are drawing under your Standby Letter of
Credit No. 26963 as Braun Development, Inc. has
failed to complete one or more of the following
construction requirements as set out in the
Developer's Agreement for Braun's Addition. Under
the terms of the Development Agreement dated the
11th day of August, 1988, between the City of
" .
.
.
Page 2
Albertville and Braun Development, Inc., the City
is entitled to the unreleased portion of this
Standby Letter of Credit to be used to complete
said improvements (indicate all item(s) and check
which item(s) apply to the drawing:
[] (a)
[] (b)
[] (c)
[] (d)
Boulevard Improvements.
Grading control.
Street signs.
Street cleaning.
(4) Be accompanied by the original Letter of Credit for
endorsement.
Drafts and drawing certificates which otherwise conform to the
terms and conditions hereof shall be deemed to be proper if
presented on or before the appropriate time specified under
SPECIAL CONDITIONS, paragraph 1.
SPECIAL CONDITIONS:
1. Time of Drawings. Demand for payment may be made by
you under this Letter of Credit by original documentation
presented at any time during our business hours at our office
located at 701 Central Avenue East, St. Michael, Minnesota
55376, or our Albertville facility in Albertville, Minnesota, on
any day upon which banks located in the State of Minnesota are
not required or authorized to remain closed (a "business day").
If demand for payment hereunder is received by us at or prior to
12:00 noon on a Business Day, and provided that such demand for
payment in the documents presented therewith conform to the terms
and conditions hereof, we shall authorize the payment to you of
the amount demanded on or before noon on the next Business Day;
if any such demand for payment is received by us after noon on a
Business Day, we shall authorize the payment to you of the amount
demanded on or before noon on the second Business Day thereafter.
2. Methods of Payment. Payments authorized in accordance
with paragraph 1 under SPECIAL CONDITIONS shall be made on the
date of authorization in immediately available funds.
3. Expiration. This Letter of Credit shall expire at the
close of our business hours on August 14, 1989, provided,
however, this Standby Letter of Credit is automatically renewable
for successive one year periods from the present expiration date
unless we notify you by certified mail, addressed to the City of
Albertville, P.O. Box 131, Albertville, Minnesota 55301, thirty
(30) days prior to said expiration date that we elect not to
renew the Letter of Credit for an additional period of one year.
~
, '.
.
.
.
Page 3
4. Maximum Amount of Drawing. This Letter of Credit has
been issued pursuant to the Developer's Agreement dated the 11th
day of August, 1988, by and between Braun Development, Inc., as
Developer, and the City of Albertville. The amount which may be
drawn pursuant to this Letter of Credit for particular items are
as follows:
a. For boulevard improvements, grading control,
street signs and street cleaning: $10,200.00.
b. The Bank shall be entitled (but not required) to
exercise any developer rights granted in the
Development Agreement, including but not limited
to, the reduction and release provisions contained
in Paragraph 6 of the Development Agreement.
GENERAL CONDITIONS:
1. Drawings; Reduction of Stated Amount. Each drawing
hereunder shall reduce by the amount of the drawing the amount
available under this Letter of Credit.
2. Limitation on Obligations. Security State Bank of
st. Michael has no obligation or right to:
a. Inquire into the correctness of any such herein
described certification; or
b. See to the proper application or use by the City
of Albertville of any payments by the Bank to it
under such certification.
3. Transferability.
transferrable.
This Letter of Credit is not
4. Irrevocability. This Letter of Credit is irrevocable.
5. Complete Agreement. This Letter of Credit sets fdrth
in full the terms of our undertaking. Reference in this Letter
of Credit to other documents or instruments is for identification
purposes only, and such reference shall not modify or affect the
terms hereof or cause such documents or instruments to be deemed
incorporated herein.
6. Governing Regulation. Our rights or our liabilities
and responsibilities are strictly limited in accordance with the
most current revision of Uniform Customs and Practice for
Documentary Credits, 1983 Revision, ICC Publication No. 400,