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HomeMy WebLinkAbout5.c. Old City Hall Sale / LeaseJAMES E. KNUTSON JOSEPH E. FLYNN PAUL W. HETLAND THOMAS S. DEANS GLORIA B. OLSEN ROBERT A. HUGHES PATRICK J. FLYNN JEFFREY W. JACOBS LAW OFFICE rI ufson, �' ' ynn, Heila nd & Deans PROFESSIONAL ASSOCIATION 345 CEDAR STREET - SUITE 800 PIONEER PRESS/DISPATCH BUILDING ST. PAUL, MINNESOTA 55101-1062 612-222-2811 March 12, 1987 PERSONAL AND CONFIDENTIAL Mr. Donald McGuire Superintendent of Schools Dakota County Area Vocational Technical Institute District 917 1300 East 145th Street Rosemount, MN 55068 Dear Mr. McGuire: CLERK'S 1 9 8 7 0 6 STEPHEN M.KNUTSON MICHAEL J. FLYNN MARIE C. SKINNER OF COUNML FRED N. PETERSON. JR. ------------------ JOHN M. MAAS. PH.D CONSULTANT Enclosed you will find a redrafted lease dated 3/12/87. The lease has the following changes from the 3/2/87 draft: 1. Page 6, Major Capital'Expenditures, paragraph 11(c). The previous provision has been deleted and replaced with a provision that provides that the cost of the major capital expenditures will be borne solely by the City during the first year of the lease, shared equally by the City and the School District in the second year of the lease, and paid solely by the School District in the third year of the lease. 2. Page 8, Insurance, paragraph 15. The previous pro- vision has been deleted and replaced with a provision which provides for the existing liability coverage limitations carried by the School District. The numbers have not been filled in.and can be filled in at your office. Also, the language provides that while the City would maintain fire and extended coverage that the School District will reim- burse the City for said coverage. 3. Page 8, Option to Purchase, paragraph 18. This paragraph has been amended to provide that the credit for rent would be for a total of fifteen (15) months, for a maxi- mum credit of $37,500. In addition, the easement rights to be retained by the City have been set forth. The obligation of the City to maintain insurance for its use of the property retained by the City pursuant to an easement is now set forth. The details were obtained from the City following our last conversation with you. Please review these care- fully to be sure that they conform with your understandings and needs. t Om'FILE s �yP Mr. Donald McGuire March 12, 1987 Page 2 - 4. Page 12, Air Raid Siren, paragraph 21. This paragraph has been added to address concerns regarding the noise level based upon the present location of the air raid siren. The air raid siren is to be located on the property the City retains for a well and related purposes pursuant to an easement. It would appear that we are essentially at the end of the negotiations on these matters, and we would urge you to carefully review the entire lease from beginning to end to be sure that it reflects your understandings and fully meets the needs of the School District. Sincerely, .Joseph E. Flynn and Patrick J. Flynn JEF:jt Enclosure cc: Mr. Ray Jesh i aURKS 198? 0b 3/12/87 LEASE/OPTION TO PURCHASE AGREEMENT THIS AGREEMENT is entered into between the City of Rosemount, a Minnesota municipal corporation, as Lessor (hereinafter referred to as "Lessor"), and Dakota County Area Vocational Technical Institute Intermediate School District 917, as Lessee (hereinafter referred to as "Lessee") in consideration of the convenants herein contained, as follows: 1. DESCRIPTION OF PROPERTY - Lessor hereby leases to said Lessee that certain land and premises lying in the County of Dakota, State of Minnesota, generally known as the old city hall, legally described as follows: The SWIA of the SE1/4 of the NE1/4, Section 27, Range 115, Township 19, except the South 230 feet of the West 225 feet thereof. The existing building consists of approximately 8,000 square feet. 2. TERM - This lease shall be in effect for a period of three (3) years, commencing on July 1, 1987 and terminating on June 30, 1990. 3. RENT - The Lessee agrees to pay Lessor as rent for said land and premises for the full term hereof, -.the sum of Thirty Thousand and no/100 Dollars ($30,000.00) per annum in equal monthly installments of Two Thousand Five Hundred and no/100 ($2,500.00) payable in advance on the first day of 2 cxRLEcs 1987 0 6 each and every month for and during the full term hereof. Lessee at its o tion may prepay rent P 4. UTILITIES - The Lessee agrees to promptly pay all costs of electricity, gas, oil, sewer, water, and other uti- lities as may be provided to such leased land and premises. 5. SUBLETTING AND ASSIGNMENT - The Lessee may sublet the premises in whole or in part, but the making of a sublease shall not release the Lessee from, or otherwise affect in any manner, any of the Lessee's obligations under this agreement. The Lessee shall not assign, -transfer, or sublet this lease, or any interest herein, without the prior written consent of Lessor. Said consent shall not be unreasonably withheld, and a consent to an assignment shall not be deemed to be consent to any subsequent assignment. Any assignment without such consent shall be void. 6. USE OF LEASEHOLD During the term hereof, the Lessee shall comply with all applicable laws affecting the leased land and premises. The leased land and premises shall not be used for any unlawful purposes by the Lessee or any sublessee. 7. RIGHT OF ENTRY - The Lessor, its employees and agents shall have the right to enter upon the leased land and premises at all reasonable times with the Lessee's per- mission for the purpose of inspecting it or carrying out its other responsibilities under this lease: The Lessor in making any such entry shall not disrupt the Lessee's use of -2- CH1E 5 1 9 8 7 0 6 the leased land and premises. 8. QUIET ENJOYMENT - The Lessor agrees that the Lessee, on performing the covenants herein, shall and may peaceably and quietly have, hold and enjoy the leased land and premises for the term hereof, except as otherwise pro- vided in this lease. 9. MAINTENANCE OF THE LEASEHOLD - The Lessee shall be responsible for the normal operation and maintenance of the Teased land and premises, except as otherwise provided in - paragraph 11 hereof. 10. ALTERATIONS; IMPROVEMENTS - (a) Alterations, improvements, and changes permitted. The Lessee shall have the right to make such alterations, improvements, and changes to the building from time to time as it may deem necessary; provided that prior to making any structural alterations, improvements, or changes, the Lessee shall obtain Lessor's written approval of plans and specifi- cations therefor, which approval Lessor shall not unreaso- nably withhold. In the event of disapproval, Lessor shall give to the Lessee an itemized statement of reasons there- for. If Lessor does not disapprove the plans and specifica- tions provided for in this paragraph within thirty (30) days after the same have been submitted to Lessor, such plans and specifications shall be deemed to have been approved by Lessor. The Lessee shall in no event make any alterations, improvements, or other changes of any kind to any building -3 CLUX' FILE S 198? 06 on the premises that will adversely affect the structural integrity of the building. (b) Removal or replacement. -At the expiration or other termination of this lease, the Lessee shall have no obligation to remove or replace any alterations, improve- ments or changes to the leased premises or, except as other- wise provided in the case of injury or damage, to return the premises to their original condition at the commencement of the lease. •(c) Disposition of new improvements. Except as other- wise specified herein, all alterations, improvements, e changes, or additions made in or to the land and premises shall be the property of Lessor, and the Lessee shall have only a leasehold interest therein, subject to the terms hereof, except as otherwise agreed to in writing by the par- ties at the time of the modifications. The Lessee may remove any property installed by Lessee in the nature of equipment or fixtures, which may be removed without adver- sely affecting the structural integrity of the building, provided that the Lessee shall repair any damages caused due to the removal of fixtures or equipment. 11. DAMAGE, REPAIRS AND DESTRUCTION OF THE PREMISES - (a) Damage and Repairs. The Lessee assumes respon- sibility for loss, damage, or injury to the leased premises -4- FU s 06 caused by its officers, employees, invitees or others in connection with the Lessee's activities, or by its occupancy of the leased premises, other than by reasonable wear and tear, and except for casualty losses subject to property and casualty insurance losses insured by the Lessor, or major capital expenditures as provided in paragraph (c) hereof, and subject to repair by the Lessor as provided in paragraph (b) and (c).hereof. Upon the expiration or termination of this lease as provided herein, the Lessee shall return the property herein described to the Lessor and the Lessee shall repair such damage or injury to the premises, other than -ordinary and reasonable wear and tear. (b) Destruction. If during the term hereof the leased premises or the improvements thereon shall be injured or destroyed by fire or the elements, or through any other cause, so as to render the leased premises unfit for occu- pancy, or to make it impossible to conduct the business of the Lessee thereon, or to such an extent that they cannot be repaired with reasonable diligence within sixty (64) days from the happening of such injury, then either party may terminate this lease from the date of such damage or destruction, and the Lessee shall immediately surrender the leased premises and all interest therein to the Lessor, and the Lessee shall pay rent only to the time of such damage or destruction; and in case of any such termination, the Lessor may re-enter and repossess the leased premises discharged of -5- 98? 06 this lease, and may dispossess all parties then in possession thereof. If repairs are not completed within sixty (60) days, and if neither party terminates this lease, then rent shall not run or accrue after the injury and during the process of repairs, and up to the time when the repairs shall be completed, except only that the Lessee shall during such time pay a prorata portion of such rent` apportioned to the portion of the leased premises which are in condition for occupancy or which may be actually occupied during such repairing period. If, however, the leased pre- mises shall be so slightly injured by any cause aforesaid, as not to be rendered unfit for occupancy, then the Lessor shall repair the same with reasonable promptness, and in that case the rent shall not cease or be abated during such repairing period. All improvements or betterments placed by the Lessee on the leased premises shall, however, in any event, be repaired and replaced by the Lessee at its own expense and not at the expense of the Lessor to the extent said improvements or betterments represent fixtures or equipment which may be removed by Lessee at the termination of this lease. (c) Major Capital Expenditures. The Lessor shall be responsible for any major capital expenditures required during the first tweleve (12) months of the lease, including but not limited to boiler replacement, roof repair, or other major structural repair, provided that written demand is CUMs 198' 06 given to Lessor during the first twelve (12) months of the lease. During the thirteenth (13th) through twenty-fourth (24th) months of the lease the Lessor and Lessee shall share equally any major capital expenditures required, provided that written demand is given to Lessor during the thir- teenth (13th) through twenty-fourth (24th) months of the lease. During the twenty-fifth (25th) through thirty-sixth (36th) months of the lease the Lessee shall be responsible for all major'capital expenditures. 12. SUCCESSORS BOUND - It is mutually agreed that all the terms and conditions of this agreement shall, subject to the provisions on assignment,'transfer and subletting, extend, apply to and bind the successors and assigns of the respective parties hereto as fully as the respective parties are themselves bound. 13. TERMINATION FOR CAUSE If either the Lessor or the Lessee fails to keep and perform the covenants herein contained, or hereafter entered into, then the party so failing does hereby authorize and fully empower the other party to terminate and annul this lease. Said right to terminate this agreement requires the party alleging a default to provide written notice to the other party, as set forth in this lease, specifying the default(s) and the action required to remedy said default(s). The defaulting party shall have a reasonable time to correct said default, but, in any event, no less than fourteen (14) days following -7- s CFILE LERKS 1987..... O 6 the service of notice. In the event of Lessor's failure, Lessor further empowers the Lessee to quit the leased premi- ses and to declare any and all rents not otherwise due and payable abated. In the event of the Lessee's failure, the Lessee further empowers the Lessor to perfect such removal as it may deem advisable to recover exclusive possession of all of said premises, including any and all improvements, building or otherwise of a permanent nature, upon the premi- ses at that time. 14. SURRENDER The voluntary or other surrender of the lease by the Lessee, or a mutual cancellation thereof, shall not work a merger, and shall, at the option of Lessor, terminate all or any existing subleases or subtenancies, -or may, at the option of Lessor, operate as an assignment to it of any or all such subleases or subtenancies, 15. INSURANCE - The Lessee shall maintain liability insurance during the term of the lease. The policies shall provide coverage of not less than $ in the event of bodily injury or death to one person, not less than $ in the event of bodily injury or death to any number of persons in any one occurrence, and not less than $ for damage or injury to property. The Lessee shall cause the Lessor to be named on said liability poli- cies as an additional named insured. The Lessor shall maintain casualty, including fire and extended coverage, for casualty loss to the building in FILE 1.9s7 06 amounts acceptable to Lessee and Lessor, and name Lessee as an additional named insured. Lessee agrees to reimburse Lessor for the cost of the premiums for the casualty insurance within thirty (30) days following the date that proof of payment is provided to Lessee. 16. REPRESENTATIONS - There are no promises or repre- sentations except those contained in this agreement and this agreement may only be changed in writing signed and acknowledged by both parties and not by any verbal represen- tations made by either party hereto. 17. NOTICES - The following individuals have been designated by the Lessor and the Lessee to respond to inquiries regarding the leased land and premises and are further authorized to accept service of process and receive and give receipt for notices -and demands, and in the case of the Lessor, accept the rental payments required herein, in connection with this lease. LESSOR'S DESIGNEE: Name: City Administrator Address: 2875 -145th Street W. Rosemount, Minnesota 55068 LESSEE'S DESIGNEE: Name: Superintendent of Schools Address: 1300 E. 145th Street Rosemount, Minnesota 55068 The individual or address to which any notice, demand -9- FILE1987 CWS 6 or other writing may be given or made or sent to either party may be changed by written notice given by such party. 18. OPTION TO PURCHASE - In consideration of all other provisions of this agreement, Lessor hereby grants to Lessee the exclusive option to purchase the real estate, building, and personal property attached to said facility for the total sum of Two Hundred Seventy Thousand and no/1OO Dollars ($270,000.00). It is further agreed that the base rent pur- suant to paragraph 3 of this lease to a maximum of fifteen (15) months ($379500-00 )shall be applied as a credit to said purchase price for rent actually paid. The Lessee shall notify the Lessor of intent to exer- cise its option no later than six (6) months prior to the termination of this lease, in writing. Lessee's right to exercise this option to purchase is conditioned upon this lease not having been previously terminated, and Lessee having observed and complied with all terms and conditions of the lease required of Lessee up to the time of the exer- cise of the option to purchase. The purchase price of $270,000.00, less any credit applicable, by the terms of this lease, shall be paid in cash to Lessor at the date of closing, which shall be no more than ninety (90) days after written notice of intent to purchase. On the date of closing, Lessor shall convey the premises to Lessee free and clear of all liens and encumbrances, except those Lessee may have created or suffered against the premises, or charges -10- Fars 1987 0 that may have become a lien against the premises during the period of this lease and except the easement rights of Lessor hereinafter set forth. The Lessor shall retain an easement for the construe - tion, operation and maintenance of a well, water storage and distribution system. The easement, consisting of one (1) acre more or less, shall be legally described as follows, to -wit: The North 208.7' of the East 208.7' of the following described tract; The SW1l4 of the SE114 of the NE1/4, Section 27, Range 115, Township 19, except the South 230 feet of the West 225 feet thereof. Lessor acknowledges that the Lessee intends to use the real property to operate a childcare facility and other similar purposes, and agrees that the use of the property pursuant to the Lessor's easement shall not be inconsistent with the intended use by Lessee. The Lessor shall also have an easement for access to the above described property, the location of said easement for access shall be as designated by the Lessee and shall.not be inconsistent with the intended use of the premises by Lessee. If Lessor exercises its right to use the above described one acre tract for the designated purposes, the Lessor agrees that it will maintain, at its cost, all usual' and customary insurance coverage, including casualty for -11- do 1981 1)6 FRE fire and extended coverage, liability, and.damage to pro- perty. The Lessee shall be named as an additional insured on said policies, and the policy limits shall be in amounts not less than the amounts required of Lessee pursuant to paragraph 15. 19. EXISTING BALLFIELD - Lessee hereby agrees that during the term of this lease Lessor may continue to use an existing ballfield, and in conjunction with the use of the ballfield may use the grass area West of the parking lot -and the area Wkh of the ballfield for parking.Said use, by Lessor, shall be substantially equivalent to the previous use of the premises by the Lessor. Lessor shall be,respon- sible for all costs maintaining said areas. Lessor shall provide written notice to Lessee in advance of its intended schedule of use of the premises. The parties mutually agree to cooperate in scheduling the use of the ballfields and adjacent parking areas. 20. WATER SUPPLY The leased premises are not con- nected to City water. Thewatersupply is obtained from a private well located on the leased premises. Lessor agrees that prior to the commencement date of said lease,•that Lessor shall provide proof satisfactory to Lessee that the water supply is potable and that the water complies with the requirements of applicable federal, state and local laws, including but not limited to the provisions of Minnesota Statutes Chapter 156A and Minnesota Rules for Water Supplies -12- CL FILE 19 81 06 and Wells set forth in Chapters 4720, 4725, and 4727. Lessor further agrees that it will cause said water and well to be tested periodically as required by law, and at the request of Lessee at such additional times as may be requested and are reasonable. Lessor further agrees that if the well or water supply fails to meet any federal, state, or local law, or any of the specific statutes cited herein, the Lessor, at its expense, shall immediately have such problems repaired. Lessor further agrees that if Lessee exercises its option to purchase that the Lessor will immediately cause a new well to be dug in conformity with local, state and federal laws and the specific statutes and rules cited herein. That in addition to any such requirements of law, that said well will provide adequate supplies of potable water to meet the intended uses and needs of Lessee. The intended use by Lessee is the operation of a childcare faci- lity, with a maximum of approximately 140 slots. The requirements set forth in this provision, including but not limited to testing, any necessary modifications or repairs, and the providing of a new well, shall be at the sole expense of the Lessor. 21. AIR RAID SIREN - The Lessor agrees, prior to the commencement of the lease, to remove the existing air raid siren from the present location. The Lessee agrees that said air raid siren may be relocated on the one acre -13_ CLEIMS MSE tract described at paragraph 18. 22. REMEDIES - In addition to the rights and remedies for default set forth in this lease, the parties shall have such rights and remedies as provided by law in the event of default. IN WITNESS WHEREOF, THE Lessor and the Lessee by their respective officers on the dates indicated, have signed and executed this agreement. Executed by Lessor LESSOR: on the day of f 19 by by Executed by Lessee LESSEE on the day of � 19 by Chairman by Clerk -14-