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10-17-17 HRA Agenda PacketA G E N D A Regular Meeting of the Housing and Redevelopment Authority Golden Valley City Hall 7800 Golden Valley Road Council Chamber October 17, 2017 6:30 pm Pages 1.Roll Call 2.Approval of Agenda 3.Approval of Minutes - Regular Meeting - July 11, 2017 2-4 Special Meeting - July 18, 2017 5 4.Approval of Bills: Reimbursement of City Expenditures 6 City of Golden Valley $612.50 TOTAL $612.50 Bill Summary: General Fund $612.50 North Wirth Capital Project Fund $0.00 Highway 55 West Capital Project Fund $0.00 Winnetka-Medicine Lake Capital Project Fund $0.00 TOTAL $612.50 5.Receipt of September 2017 Financial Reports 7-9 6.Consider Modifications to Development Agreement with Cornerstone Creek Limited Partnership 10-66 7.Adjournment UNOFFICIAL MINUTES HOUSING AND REDEVELOPMENT AUTHORITY MEETING GOLDEN VALLEY, MINNESOTA July 11, 2017 Housing and Redevelopment Authority Chair Snope called the meeting to order at 6:30 pm. 1. Roll Call The following members were present: Chair Andy Snope, Commissioners Joanie Clausen, Larry Fonnest, Shep Harris and Steve Schmidgall. Also present was Housing and Redevelopment Authority Director Tim Cruikshank, HRA Attorney Charles Berquist and City Clerk Luedke. 2. Approval of Agenda MOTION made by Commissioner Schmidgall, seconded by Commissioner Clausen to approve the agenda of July 11, 2017, as submitted and the motion carried. 3. Approval of Minutes - Regular Meeting of April 13, 2017 MOTION made by Commissioner Fonnest, seconded by Commissioner Schmidgall to approve the Regular Housing and Redevelopment Authority minutes of April 13, 2017, as submitted and the motion carried. 4. Approval of Bills MOTION made by Commissioner Schmidgall, seconded by Commissioner Clausen to approve the bills as submitted and the motion carried. 5. Receipt of Financial Reports MOTION made by Commissioner Schmidgall, seconded by Commissioner Clausen to receive and file the June 2017 Financial Reports and the motion carried. 6. Tennant Company’s World Headquarters Expansion: Resolution Expressing Intent to Consider Establishment of a Tax Increment Finance District for the Tennant Company’s World Headquarters Expansion Physical Development Director Nevinski presented the staff report and answered questions from the Commissioners. Mr. Drew Johnson, Oppidan Investment Company, reviewed the application and project and answered questions from Commissioners. Mr. Carlos Fernandez, AFLA Landscaping, provided information on the proposed landscaping plan around the campus and answered questions from the Commissioners. Mr. Eric West. Architect, provided information on the how the building entry would look welcoming. There was discussion regarding Tennant Company and the intent to establish a Tax Increment Finance District. MOTION made by Commissioner Harris, seconded by Commissioner Fonnest to adopt HRA Resolution 17-03, expressing the intent to consider the establishment of a tax Housing and Redevelopment Authority Minutes July 11, 2017 Page 2 6. Tennant Company’s World Headquarters Expansion - continued increment financing district for Tennant Company’s World Headquarters expansion. Upon a vote being taken, the following voted in favor of: Clausen, Fonnest, Harris, Schmidgall and Snope, the following voted against the same: none and the motion carried. 7. Douglas Drive Corridor Redevelopment Area: Resolution Adopting the Redevelopment Plan for the Douglas Drive Corridor Project Area Physical Development Director Nevinski presented the staff report and answered questions from the Commissioners. MOTION made by Commissioner Harris, seconded by Commissioner Fonnest to adopt Resolution 17-04 of the Housing and Redevelopment Authority in and for the City of Golden Valley, Hennepin County, Minnesota Adopting the Redevelopment Plan for the Douglas Drive Corridor Project Area upon a vote being taken, the following voted in favor of: Fonnest, Harris, Schmidgall and Snope, the following voted against the same: Clausen and the motion carried. 8. Liberty Crossing Development Agreement: Consider First Amendment to the Development Agreement with Liberty Crossing Development Partners, LLC Physical Development Director Nevinski presented the staff report and answered questions from the Commissioners. Mr. Todd Schachtman, Developer, answered questions from the Commissioners regarding the solar project on the development. There was discussion regarding the development agreement with Liberty Crossing. MOTION made by Commissioner Harris, seconded by Commissioner Fonnest to approve the First Amendment to the Development Agreement with Liberty Crossing Development Partners, LLC upon a vote being taken, the following voted in favor of: Fonnest, Harris, Schmidgall and Snope, the following voted against the same: Clausen and the motion carried. 9. Highway 55 West Area: Resolution Authorizing Execution of Tax Increment Pledge Agreement with the City of Golden Valley Regarding Approximately $1,935,000 General Obligation Tax Increment and Improvement Bonds, Series 2017B Finance Director Virnig presented the staff report. MOTION made by Commissioner Schmidgall, seconded by Commissioner Harris to adopt HRA Resolution 17-05, authorizing Execution of a Tax Increment Pledge Agreement with the City of Golden Valley Regarding $1,935,000 General Obligation Tax Increment and Improvement Bonds, Series B upon a vote being taken, the following voted in favor of: Clausen, Fonnest, Harris, Schmidgall and Snope, the following voted against the same: none and the motion carried. Housing and Redevelopment Authority Minutes July 11, 2017 Page 3 10.First Consideration - Adoption of Proposed By-Laws Amendment - Resetting Annual and Regular Meeting Dates HRA Director Tim Cruikshank presented the staff report and answered questions from the Commissioners. MOTION made by Commissioner Harris, seconded by Commissioner Schmidgall to approve on first consideration the amendments of Section 1 and Section 2 of Article III of the Housing and Redevelopment Authority By-laws as follows: Section 1. Annual Meeting. The annual meeting of the Authority shall be held on the third Tuesday of January, at the regular meeting place of the Authority, unless changed at a scheduled meeting of the Authority held prior to the established date. Section 2. Regular Meetings. Quarterly meetings shall be held at the regular meeting place of the Authority on the third Tuesday of January (in conjunction with the annual meeting), April, July and October, unless a specific meeting is changed or cancelled at a scheduled meeting of the Authority held prior to the meeting to be changed or cancelled. 11. Adjournment MOTION made by Commissioner Schmidgall, seconded by Commissioner Clausen and motion carried to adjourn the meeting at 7:47 pm. _______________________________ Andy Snope, Chair ATTEST: ____________________________________ Kristine A. Luedke, City Clerk UNOFFICIAL MINUTES SPECIAL HOUSING AND REDEVELOPMENT AUTHORITY MEETING GOLDEN VALLEY, MINNESOTA July 18, 2017 Housing and Redevelopment Authority Chair Snope called the meeting to order at 6:30 pm. 1. Roll Call The following members were present: Chair Andy Snope, Commissioners Joanie Clausen, Larry Fonnest, Shep Harris and Steve Schmidgall. Also present was Housing and Redevelopment Authority Director Tim Cruikshank and City Clerk Luedke. 2. Approval of Agenda MOTION made by Commissioner Schmidgall, seconded by Commissioner Clausen to approve the agenda of July 18, 2017, as submitted and the motion carried. 3. Second Consideration - Adoption of Proposed By-Laws Amendment - Resetting Annual and Regular Meeting Dates HRA Director Tim Cruikshank presented the staff report and answered questions from Council. MOTION made by Commissioner Schmidgall, seconded by Commissioner Harris to adopt Resolution 17-06, amending Article III, Meetings, Section 1 Annual Meeting, and Section 2 Regular Meetings of the Golden Valley Housing and Redevelopment Authority upon a vote being taken, the following voted in favor of: Clausen, Fonnest, Harris, Schmidgall and Snope, the following voted against the same: none and the motion carried. 4. Adjournment MOTION made by Commissioner Harris, seconded by Commissioner Fonnest and motion carried to adjourn the meeting at 6:36 pm. _______________________________ Andy Snope, Chair ATTEST: _________________________ Kristine A. Luedke, City Clerk Executive Summary For Action Golden Valley Housing and Redevelopment Authority Meeting October 17, 2017 Agenda Item 4. Reimbursement of City Expenditures Prepared By Sue Virnig, Finance Director Summary As of September 30, 2017, the following expenditures were paid by the City on various check registers and need to be reimbursed by the HRA: City Expenditures:Amount 1000 Legal Fees (Tennant) Best & Flanagan $612.50 $612.50 HRA Expenditures: 9000 General Fund ($612.50-Developer Deposits)$612.50 $612.50 *Asterisk items are reimbursed by deposits held for developers. Recommended Action Motion to approve reimbursing the City of Golden Valley $612.50 (check #4084). Executive Summary For Action Golden Valley Housing and Redevelopment Authority Meeting October 17, 2017 Agenda Item 5. Receipt of September 2017 Financial Reports Prepared By Sue Virnig, Finance Director Summary Attached are the September 2017 Financial Reports for Housing and Redevelopment Authority (HRA) review. Staff will address questions from the HRA before or at the meeting. Attachments •HRA General Fund Budget Report (1 page) •HRA Capital Project Funds Report (1 page) Recommended Action Motion to receive and file the September 2017 HRA Financial Reports. Percentage Of Year Completed 50% Over % Of 2017 July-Sept YTD (Under)Budget Revenue Budget Actual Actual Budget Received Interest Earnings (2)0 0.00 0.00 0.00 Fund Balance 19,000 0.00 0.00 (19,000.00) Totals $19,000 0.00 0.00 (19,000.00)0.00% Over % Of 2017 July-Sept YTD (Under)Budget Expenditures Budget Actual Actual Budget Expended Legal Services (1)$5,000 0.00 246.00 (4,754.00)4.92% Audit 12,000 0.00 12,000.00 0.00 100.00% Totals $17,000 0.00 12,246.00 (4,754.00)72.04% Notes: (1) Includes September to date billings from Best & Flanagan. (2) Interest will be allocated at year end. HRA of Golden Valley General Fund September 2017 Budget Report (unaudited) HRA Of Golden Valley 2017 Financial Report 9300 9400 9250 Hwy 55/Winnetka North West (2)Med Lk Rd Wirth #3 (3) Cash Balance @ 07/01/17 ($524.55)$0.00 $0.00 Add: Receipts: Interest Lease revenue Increment Received 2,919.48 0.00 Less: Expenditures: City of Golden Valley (1) Payment to Bank Mutual 0.00 TIF Payment-Hennepin County 0.00 0.00 *will be paid with TIF in 2017 Cash Balance @ 09/30/17 $2,394.93 $0.00 $0.00 (1) Breakdown on City Expenditures Memo (2) Reinbursed when increment is received. (3) Pay Go Note remaining $196,643.42 Capital Project Funds Executive Summary For Action Golden Valley Housing and Redevelopment Authority Meeting October 17, 2017 Agenda Item 6. Consider Modifications to Development Agreement with Cornerstone Creek Limited Partnership Prepared By Marc Nevinski, Physical Development Director Summary In order to comply with financing requirements from MHFA for the Cornerstone Creek Apartment project, Cornerstone Creek Limited Partnership (Developer) is proposing to subdivide and transfer portions of its property to JHAP, Inc. (JHAP) in order to meet the required ratio of housing-to-non-housing uses. To accomplish this, a registered land survey (RLS) has been completed and proposes to create two additional lots for transfer to JHAP. These lots are similar to a legal description and ownership arrangement found in a condominium. The changes from the original plat are as follows: •Former Lot 1 becomes Tract A – This parcel is currently owned and will continue to be owned by JHAP. •Former Lot 2, currently owned by the Developer, becomes Tracts B, C and D. Tract B will continue to be owned by the Developer. •Tract C ownership will transfer to JHAP. The parcel is located on the sub-grade level of the underground parking area. •Tract D ownership will transfer to JHAP. The parcel consists of the ground level corridor on the west side of the building providing access from the exterior to offices and the planned community building. These changes necessitate modifications to the Private Development Agreement with the HRA as well as a number of related documents. The amendment describes changes to the parcels and describes their proposed ownership. It also includes requirements the Developer: •obtains necessary PUD amendments from the City (tentatively scheduled for November 8) •enter into an amended Assignment and Assumption Agreement with the HRA, whereby JHAP assumes the obligations of the Developer for Tracts C and D •enter into amendments to the reciprocal agreements with JHAP •enter into new assessment agreements to reflect tax obligations for the new parcels The amendment also requires JHAP to pay the taxes on Tracts C and D, and extends the completion date for the Community Building to March 31, 2019. Attachments •Survey Drawing Exhibits (9 pages) •First Amendment to the Cornerstone Creek Private Development Agreement (15 pages) •Amendment to Assignment and Assumption Agreement (6 pages) •Amended & Restated Reciprocal Maintenance, Use, and Easement Agreement (25 pages) Recommended Action Staff recommends the HRA Make the following motions: 1. Approve the First Amendment to the Cornerstone Creek Private Development Agreement and authorize the Chair and Executive Director to execute the agreement. 2. Approve the Amendment to the Assignment and Assumption agreement and authorize the Chair and Executive Director to execute the Consent. 3. Approve the Amended and Restated Reciprocal Maintenance Use and Easement Agreement. 1 Cornerstone Creek Modifications to Plat 2017 This survey drawing shows the plat as it currently exists. The RLS will change Lot 1 to Tract A and Lot 2 to Tract B. Ownership of these Tracts will not change. TRACT B TRACT A 2 TRACT A TRACT B TRACT C This survey drawing shows the addition of Tract C, which is located underground and comprises the majority the underground parking area. Tract C will be owned by JHAP. 3 TRACT C Location within building. 4 TRACT A TRACT D TRACT B This survey drawing shows the addition of Tract D, which is located at grade level and comprises the corridor on the west end of the building. Tract D will be owned by JHAP. 5 TRACT D location within building, DRAFT FIRST AMENDMENT TO CORNERSTONE CREEK PRIVATE DEVELOPMENT AGREEMENT THIS FIRST AMENDMENT TO CORNERSTONE CREEK PRIVATE DEVELOPMENT AGREEMENT (“Amendment”), is made and entered into, effective as of October ____, 2017, by and among THE HOUSING AND DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF GOLDEN VALLEY, a public body corporate established and existing under Minnesota Statutes Section 469.001, et seq., with its principal offices at 7800 Golden Valley Road, Golden Valley, Minnesota 55427 (“HRA”); CORNERSTONE CREEK LIMITED PARTNERSHIP, a Minnesota limited partnership, with its offices at 614 North First Street, Suite 100, Minneapolis, Minnesota 55401 (“Developer”); and J-HAP, Inc., a Minnesota nonprofit corporation, with offices located at 13100 Wayzata Boulevard, Suite 300, Minneapolis, Minnesota 55305 (“JHAP”). WHEREAS, the HRA and Developer entered into that certain Cornerstone Creek Private Development Agreement, effective October 14, 2015, recorded as Document No. T05323029 in the office of the Hennepin County Registrar of Titles (“Private Development Agreement”), concerning the Development Property legally described in Exhibit A attached to this Amendment; and WHEREAS, Developer and JHAP entered into that certain Assignment and Assumption Agreement, effective January 25, 2016, recorded as Document No. T05323032 in the office of the Hennepin County Registrar of Titles (“Assignment and Assumption Agreement”), whereby Developer assigned to JHAP all of Developer’s right, title, interest, and obligations in, to, and under the Community Building Property and portion of the Development Agreement relating thereto, and JHAP accepted the Assignment and assumed and agreed to perform all obligations of Developer under the Private Development Agreement relating to the Community Building Property; and WHEREAS, the HRA consented to the Assignment and Assumption Agreement, pursuant to a Consent attached to the Assignment and Assumption Agreement; and WHEREAS, Developer wishes to subdivide the Housing Property by Registered Land Survey into three parcels with the following new legal descriptions: Tracts B, C and D, Registered Land Survey No. ____, Hennepin County, Minnesota WHEREAS, Tract B includes the Housing Building, Tract C includes parking spaces, and Tract D includes a corridor; and WHEREAS, Developer then intends to transfer Tracts C and D to JHAP; and WHEREAS,Developerwishes tochangethelegal descriptionfortheCommunityBuilding Property to Tract A, Registered Land Survey No. ____, Hennepin County, Minnesota; and WHEREAS, the parties wish to revise the Private Development Agreement to reflect the above changes, and to make certain other revisions: 2 NOW, THEREFORE, in consideration of the foregoing, and in consideration of the mutual terms and conditions contained herein, the parties hereby agree as follows: 1.All capitalized terms used but not defined herein shall have the meanings given to them in the Private Development Agreement. 2.Required Actions. Developer and JHAP shall take the following actions: (a)Apply to the City for approval of an amendment to the existing P.U.D. for the Development Property; (b)Complete the subdivision of the Development Property pursuant to the Registered Land Survey; (c)Enter into an amended Assignment and Assumption Agreement in a form reasonably acceptable to the City and the HRA; (d)Enter into an amended Reciprocal Maintenance, Use, and Easement Agreement in a form reasonably acceptable to the City and the HRA; (e)Enter into the Amended Assessment Agreement for Tract B attached to this Amendment as Exhibit A; and (f)Enter into the new Assessment Agreement for Tracts C and D attached to this Amendment as Exhibit B; and (g)Such other actions as are reasonably requested by the City or the HRA. Developer and JHAP shall use their best efforts to complete the above actions as soon as practicable. 3.Payment of Taxes. Developer agrees to pay, when due, all approved assessments and real estate taxes payable with respect to Tract B through December 31, 2043. JHAP agrees to pay, when due, all approved assessments and real estate taxes payable with respect to Tracts A, C and D through December 31, 2043. 4.The definition of Assessment Agreement in Section 1.1 of thePrivate Development Agreement is revised to state as follows: “Assessment Agreement” means the Amended Assessment Agreement for Tract B attached to this Amendment as Exhibit A, and the new Assessment Agreement for Tracts C and D attached to this Amendment as Exhibit B. 5.The definition of Community Building Property in Section 1.1 of the Private Development Agreement is revised to state as follows: Tract A, Registered Land Survey No. ____, Hennepin County, Minnesota. 3 6.The definition of Housing Property in Section 1.1 of the Private Development Agreement is revised to state as follows: Tracts B, C and D, Registered Land Survey No. ____, Hennepin County, Minnesota. 7.Section 4.2 of the Private Development Agreement is revised to change the completion date for 100 percent of the shell of the Community Building to March 31, 2019. 8.Except as amended hereby, the Private Development Agreement continues in full force and effect. In the event of any conflict between the terms, conditions and provisions of the Private Development Agreement and this Amendment, the terms, conditions and provisions of this Amendment shall prevail. This Amendment may be executed in one or more counterparts, each ofwhichshall forall purposes bedeemedtobeanoriginal andall ofwhichshall togetherconstitute one and the same instrument. IN WITNESS WHEREOF, the parties have caused this Amendment to be duly executed in their names and behalf as of the date first above written. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF GOLDEN VALLEY By: Andy Snope, Chair And Timothy J. Cruikshank, Director STATE OF MINNESOTA COUNTY OF HENNEPIN }ss The foregoing instrument was acknowledged before me this ______ day of _________________, 2017, by Andy Snope, Chair, and Timothy J. Cruikshank, Director, of The Housing and Redevelopment Authority in and for the City of Golden Valley, on behalf of the organization. Notary Public 4 CORNERSTONE CREEK LIMITED PARTNERSHIP By: CHDC Cornerstone Creek LLC, General Partner By: Its: STATE OF MINNESOTA COUNTY OF HENNEPIN }ss The foregoing instrument was acknowledged before me this ______ day of _________________, 2017, by _________________________________, of Cornerstone Creek LLC, the general partner of Cornerstone Creek Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public 5 J-HAP, INC. By: Its: STATE OF MINNESOTA COUNTY OF HENNEPIN }ss The foregoing instrument was acknowledged before me this ______ day of _________________, 2017, by _________________________________, of J-HAP, Inc., a Minnesota nonprofit corporation, on behalf of the corporation. Notary Public DRAFTED BY: Charles C. Berquist, Esq. Best & Flanagan LLP 60 South Sixth Street, Suite 2700 Minneapolis, MN 55402 #5108992_3 EXHIBIT A AMENDED ASSESSMENT AGREEMENT FOR VALUABLE CONSIDERATION, The Housing and Redevelopment Authority in and for the City of Golden Valley, Minnesota, a public body corporate established pursuant to Minnesota Statutes, Section 469.001 et seq. (the “HRA”); and Cornerstone Creek Limited Partnership, a Minnesota limited partnership (“Developer”), hereby covenant and agree that the property described in Exhibit 1 attached hereto and made a part hereof (the “Development Property”) and the improvements to be made thereto (the “Improved Parcel”) pursuant to the Private Development Agreement (the “Development Agreement”) between the parties dated as of October 14, 2015, as amended by the First Amendment to Private Development Agreement between the parties dated as of October __, 2017 (the “Development Agreement”), with respect to which any real estate taxes, or taxes in lieu thereof which are levied or assessed and payable by Developer, shall be assessed to be of a market value of not less than $5,728,000 as of January 2, 2018, and January 2 of every year thereafter until December 31, 2043 (for taxes payable in 2019 and subsequent years), decreased in any year by the fair market value of any portion of the improvements taken in condemnation or bythe power of eminent domain for which reconstruction is impracticable as provided in the Development Agreement, and by the fair market value for any portion of the unimproved Improved Parcel taken in condemnation or by the power of eminent domain (the “Assessor’s Minimum Market Value”). Anycapitalized term not defined herein shall have the meaning set forth in the Development Agreement. During the term of this Amended Assessment Agreement, Developer shall not seek a reduction of the market value of the Improved Parcel for property tax purposes below the Assessor’s Minimum Market Value stated above, regardless of actual market values which may result from incomplete construction of improvements to the Improved Parcel, or from destruction or diminution thereof by any cause, insured or uninsured, except in the case of acquisition or reacquisition of any portion of the Improved Parcel by a public entity. The Developer may apply to have the Housing Building classified under the Low-Income Rental Classification pursuant to MinnesotaStatutes §273.128,but shall not applyfortax exemptionforthe HousingBuilding. The Developer and its successors and assigns shall not apply for a tax exemption for the Community Building without the written consent of the HRA. Upon execution by the parties, this Amended Assessment Agreement shall be presented to the Hennepin County Assessor pursuant to Minnesota Statutes § 469.177, Subd. 8, as hereafter amended. If this Amended Assessment Agreement is approved and certified by such Assessor in the form attached as Exhibit 2, this Amended Assessment Agreement shall be filed in the office of the Hennepin County Recorder or in the office of the Hennepin County Registrar of Titles. The parties hereby covenant and agree that the obligations imposed hereunder shall be deemed with respect to the Development Property to be covenants and restrictions running with the land, and shall constitute burdens and benefits to the HRA and Developer, their successors, assigns, grantees and all other parties hereafter owning or holding anyinterest in the Development Property or any portions thereof. This Amended Assessment Agreement is effective as of the date hereof and shall remain in force and effect until December 31, 2043. IN WITNESS WHEREOF, the parties have caused the execution of this Amended Assessment Agreement as of this _____ day of __________, 2017. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF GOLDEN VALLEY By: Andy Snope, Chair By: Timothy J. Cruikshank, Director STATE OF MINNESOTA COUNTY OF HENNEPIN }ss The foregoing instrument was acknowledged before me this ___ day of ___________, 2017, by Andy Snope, Chair, and Timothy J. Cruikshank, Director, of THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF GOLDEN VALLEY, on behalf of the organization. Notary Public CORNERSTONE CREEK LIMITED PARTNERSHIP By: CHDC Cornerstone Creek LLC, General Partner By: Its: STATE OF MINNESOTA COUNTY OF HENNEPIN }ss The foregoing instrument was acknowledged before me this ___ day of , 2017, by _________________________, the _______________ of CHDC Cornerstone Creek LLC, a Minnesota limited liability company, as General Partner of Cornerstone Creek Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public EXHIBIT 1 LEGAL DESCRIPTION Tract B, Registered Land Survey No. ____, Hennepin County, Minnesota. EXHIBIT 2 ASSESSOR CERTIFICATION FORM The undersigned, being the duly qualified and acting Hennepin County Assessor, hereby certifies that: 1.He is the assessor responsible for the assessment of the Development Property described in the foregoing Amended Assessment Agreement; 2.He has read the foregoing Amended Assessment Agreement; 3.He has received and read a copy of the Private Development Agreement and First Amendment thereto; 4.He has received and reviewed the architectural and engineering plans and specifications for the improvements agreed to be constructed on the Development Property by CHDC Cornerstone Creek, LLC pursuant to the Private Development Agreement; 5.Hehas reviewedthemarket valuepreviouslyassignedtotheDevelopment Property upon which such improvements are to be constructed; and 6.The undersigned assessor, beinglegallyresponsible for the assessment of the above described Development Propertyupon completion of the improvements to be constructed thereon, hereby certifies that the market value assigned to the Improved Parcel (as defined in the Amended Assessment Agreement) and the improvements thereto upon completion shall be not less than $5,728,000 on January 2, 2018, and January 2 of every year thereafter until December 31, 2043 (for taxes payable in 2019 and subsequent years), decreased in any year by the fair market value of any portion of the improvements taken in condemnation or by the power of eminent domain for which reconstruction is impracticable as provided in the Development Agreement, and by the fair market value for any portion of the unimproved Improved Parcel taken in condemnation or by the power of eminent domain. Dated:____________________, 20___. Hennepin County Assessor Hennepin County, Minnesota EXHIBIT B ASSESSMENT AGREEMENT FOR VALUABLE CONSIDERATION, The Housing and Redevelopment Authority in and for the City of Golden Valley, Minnesota, a public body corporate established pursuant to Minnesota Statutes, Section 469.001 et seq. (the “HRA”); and J-HAP, Inc., a Minnesota nonprofit corporation (“JHAP”), herebycovenant and agree that the propertydescribed in Exhibit 1 attached hereto and made a part hereof (the “Development Property”) and the improvements to be made thereto (the “Improved Parcel”) pursuant to the Cornerstone Creek Private Development Agreement (the “Development Agreement”) dated as of October 14, 2015, as amended bythe First Amendment to Private Development Agreement between the parties dated as of October __, 2017 (the “Development Agreement”), with respect to which any real estate taxes, or taxes in lieu thereof which are levied or assessed and payable by JHAP, shall be assessed to be of a market value of not less than $252,000 as of January 2, 2018, and January 2 of every year thereafter until December 31, 2043 (for taxes payable in 2019 and subsequent years), decreased in any year bythe fair market value of any portion of the improvements taken in condemnation or by the power of eminent domain for which reconstruction is impracticable as provided in the Development Agreement, and bythe fair market value for any portion of the unimproved Improved Parcel taken in condemnation or by the power of eminent domain (the “Assessor’s Minimum Market Value”). Any capitalized term not defined herein shall have the meaning set forth in the Development Agreement. During the term of this Amended Assessment Agreement, JHAP shall not seek a reduction of the market value of the Improved Parcel for property tax purposes below the Assessor’s Minimum Market Value stated above, regardless of actual market values which may result from incomplete construction of improvements to the Improved Parcel, or from destruction or diminution thereof by any cause, insured or uninsured, except in the case of acquisition or reacquisition of any portion of the Improved Parcel by a public entity. JHAP may apply to have the Improved Parcel classified under the Low-Income Rental Classification pursuant to Minnesota Statutes § 273.128, but shall not apply for tax exemption for the Improved Parcel. Upon execution by the parties, this Assessment Agreement shall be presented to the Hennepin County Assessor pursuant to Minnesota Statutes § 469.177, Subd. 8, as hereafter amended. If this Assessment Agreement is approved and certified by such Assessor in the form attached as Exhibit 2, this Assessment Agreement shall be filed in the office of the Hennepin County Recorder or in the office of the Hennepin County Registrar of Titles. The parties hereby covenant and agree that the obligations imposed hereunder shall be deemed with respect to the Development Property to be covenants and restrictions running with the land, and shall constitute burdens and benefits to the HRA and Developer, their successors, assigns, grantees and all other parties hereafter owning or holding anyinterest in the Development Property or any portions thereof. This Amended Assessment Agreement is effective as of the date hereof and shall remain in force and effect until December 31, 2043. IN WITNESS WHEREOF, the parties have caused the execution of this Amended Assessment Agreement as of this _____ day of __________, 2017. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF GOLDEN VALLEY By: Andy Snope, Chair By: Timothy J. Cruikshank, Director STATE OF MINNESOTA COUNTY OF HENNEPIN }ss The foregoing instrument was acknowledged before me this ___ day of ___________, 2017, by Andy Snope, Chair, and Timothy J. Cruikshank, Director, of THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF GOLDEN VALLEY, on behalf of the organization. Notary Public J-HAP, INC. By: Its: STATE OF MINNESOTA COUNTY OF HENNEPIN }ss The foregoing instrument was acknowledged before me this ______ day of _________________, 2017, by _________________________________, of J-Hap, Inc., a Minnesota nonprofit corporation, on behalf of the corporation. Notary Public EXHIBIT 1 LEGAL DESCRIPTION Tracts C and D, Registered Land Survey No. ____, Hennepin County, Minnesota. EXHIBIT 2 ASSESSOR CERTIFICATION FORM The undersigned, being the duly qualified and acting Hennepin County Assessor, hereby certifies that: 1.He is the assessor responsible for the assessment of the Development Property described in the foregoing Assessment Agreement; 2.He has read the foregoing Assessment Agreement; 3.He has received and read a copy of the Private Development Agreement and First Amendment thereto; 4.Hehasreceivedandreviewedthearchitecturalandengineeringplansandspecifications for the improvements agreed to be constructed on the Development Property by CHDC Cornerstone Creek, LLC pursuant to the Private Development Agreement; 5.He has reviewed the market value previously assigned to the Development Property upon which such improvements are to be constructed; and 6.The undersigned assessor, being legally responsible for the assessment of the above described Development Propertyupon completion of the improvements to be constructed thereon, hereby certifies that the market value assigned to the Improved Parcel (as defined in the Assessment Agreement) and the improvements thereto upon completion shall be not less than $252,000 on January 2, 2018, and January 2 of every year thereafter until December 31, 2043 (for taxes payable in 2019 and subsequent years), decreased in any year bythe fair market value of any portion of the improvements taken in condemnation or by the power of eminent domain for which reconstruction is impracticable as provided in the Development Agreement, and bythe fair market value for any portion of the unimproved Improved Parcel taken in condemnation or by the power of eminent domain. Dated:____________________, 20___. Hennepin County Assessor Hennepin County, Minnesota US.110249426.03 AMENDMENT TO ASSIGNMENT AND ASSUMPTION AGREEMENT THIS AMENDMENT is made this ____ day of ________________, 2017 by and between CORNERSTONE CREEK LIMITED PARTNERSHIP, a Minnesota limited partnership (“Assignor”) and J-HAP, INC., a Minnesota non-profit corporation (“Assignee”). WHEREAS, The Housing and Redevelopment Authority in and for the City of Golden Valley (the “HRA”), and Assignor are parties to the Cornerstone Creek Private Development Agreement, dated October 14, 2015, as amended by the First Amendment to Cornerstone Creek Private Development Agreement, dated _________________, 2017 (collectively, “Development Agreement”); and WHEREAS, Assignor and Assignee executed an Assignment and Assumption Agreement (Cornerstone Creek P.U.D. No. 124) dated January 25, 2016; and WHEREAS, Assignor caused the Housing Property to be subdivided by a Registered Land Survey so that the Housing Property legal description is now Tracts B, C, and D, Registered Land Survey No. _____________, Hennepin County, Minnesota; and WHEREAS, the legal description of the Community Building Property has been changed to Tract A, Registered Land Survey No. _____, Hennepin County, Minnesota; and WHEREAS, Assignor has transferred Tract C (the “Parking Parcel”) and Tract D (the “Hallway Parcel”) to Assignee; and WHEREAS, Assignee has agreed that all tax increment payable with respect to the Hallway Parcel and Parking Parcel shall be the property of Assignor. NOW THEREFORE, the parties agree as follows: 1.Terms. Capitalized terms used but not defined herein shall have the meanings given to them in the Development Agreement. 2.Assignment. Assignor hereby assigns, transfers, and conveys to Assignee all of Assignor’s right, title, interest and obligations in, to and under the Hallway Parcel and the Parking Parcel and the portion of the Development Agreement relating to the Hallway Parcel and the Parking Parcel and any and all other agreements, contracts, instruments, plans, specifications, reports, studies, and documents relating to the Hallway Parcel and the Parking Parcel and the portion of the Development Agreement relating to the Hallway Parcel and the Parking Parcel, including all supplements, amendments and modifications thereof (the “Other Documents”). Assignor warrants and represents to Assignee that, to the best of Assignor’s knowledge, Assignor has provided a true and correct copy of each of the Other Documents to Assignee. US.110249426.03 3.Assumption. Assignee hereby accepts the assignment of the Hallway Parcel and the Parking Parcel and the portion of the Development Agreement relating to the Hallway Parcel and the Parking Parcel and the Other Documents assigned hereby, and Assignee hereby assumes and agrees to perform according to their terms all obligations of Assignor in connection therewith which accrue or arise after the date hereof and through December 31, 2043, and releases and discharges Assignor from, and agrees to indemnify and hold harmless Assignor for, any liabilities or obligations that arise under the Development Agreement with respect to the Hallway Parcel and the Parking Parcel; provided, however, that Assignee shall not be liable with respect to any actions or omissions by Assignor or its employees or agents prior to the date hereof. 4.TIF. The parties agree that Assignee is not entitled to receive and has no claims against the tax increment payable to Assignor pursuant to the Tax Increment Note issued by the Housing and Redevelopment Authority in and for the City of Golden Valley, Minnesota (the “HRA”), including any tax increment related to the Hallway Parcel and Parking Parcel. Assignee agrees that any tax increment related to the Hallway and Parking Parcels shall be paid to Assignor and remain the property of Assignor. 5.Property Tax Exemption. Assignee hereby agrees not to apply for property tax exemption for the Community Building Property, the Hallway Parcel, or the Parking Parcel prior to December 31, 2043 without the prior written consent of the HRA. 6.No Defaults. Assignor hereby represents and warrants to the HRA and Assignee that as of the date hereof, Assignor has complied with all agreements, covenants and obligations required to be performed by it under the Development Agreement with respect to the Development Property, and that there are no Events of Default, as defined in the Development Agreement, in effect or in existence, or which would be in effect or in existence but for the passage of time or giving of notice or both, with respect to the Development Property. Assignor is also not aware of any uncured defaults by the HRA under the Development Agreement with respect to the Development Property as of the date hereof, nor is Assignor aware of any facts that, but for the passage of time or the giving of notice or both, would constitute a default by the HRA under the Development Agreement with respect to the Development Property. 7.Conditions to Effectiveness. This Agreement shall not become effective until the execution and delivery by the HRA of the attached Consent. 8.Continuation. All other provisions of the Assignment Agreement shall remain unchanged by this Amendment. 9.General. This Agreement shall be interpreted in accordance with Minnesota law. This Agreement is binding upon, and shall inure to the benefit of, the successors and assigns of the parties. This Agreement constitutes the entire agreement between the parties on the subject matter hereof, superseding any prior oral and written agreements on the subject matter hereof. In the event of a conflict between this Agreement and the Development Agreement, the Development Agreement shall govern. This Agreement may only be modified in a written amendment signed by both parties and approved by the HRA. US.110249426.03 IN WITNESS WHEREOF, the parties have caused the execution of this Agreement as of the day and year first above written. CORNERSTONE CREEK LIMITED PARTNERSHIP By: CHDC Cornerstone Creek LLC, General Partner By: ________________________________________ Elizabeth Flannery, Chief Manager/President STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this _____ day of _____________, 2017, by Elizabeth Flannery, Chief Manager/President of Cornerstone Creek LLC, the general partner of Cornerstone Creek Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public US.110249426.03 J-HAP Inc., a Minnesota non-profit corporation By: Linda Bialick, President STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this _____ day of _______________, 2017, by Linda Bialick, the President of J-HAP Inc., a Minnesota non-profit corporation, on behalf of the corporation. Notary Public DRAFTED BY: Faegre Baker Daniels LLP (AMC) 2200 Wells Fargo Center 90 South Seventh Street Minneapolis, Minnesota 55402 (612) 766-7000 #5155737_3 US.110249426.03 CONSENT The Housing and Redevelopment Authority in and for the City of Golden Valley, a public body corporate established and existing under Minnesota Statutes, Section 469.001, et seq., with its principal office at 7800 Golden Valley Road, Golden Valley, Minnesota 55427 (the “HRA”), hereby consents to the foregoing Assignment and Assumption Agreement between Cornerstone Creek Limited Partnership (“Assignor”), and J-HAP, Inc. (“Assignee”), relating to the Cornerstone Creek Private Development Agreement (the “Development Agreement”). The HRA does not release or discharge Assignor and the Guarantor from any liabilities or obligations that arise under the Development Agreement with respect to the Hallway Parcel or the Parking Parcel subsequent to the date hereof, and Assignor and Assignee shall be jointly and severally liable to the HRA for the performance of all of such obligations. The HRA is not aware of any uncured defaults by either Assignor or the HRA under the Development Agreement with respect to the Hallway Parcel or the Parking Parcel as of the date hereof, nor is the HRA aware of any facts that, but for the passage of time or the giving of notice or both would constitute a default by either Assignor or the HRA under the Development Agreement with respect to the Hallway Parcel or the Parking Parcel. From and after the date hereof, an Event of Default under the Development Agreement with respect to the Hallway Parcel or the Parking Parcel shall not, in and of itself, constitute an Event of Default with respect to the Housing Property and the HRA may not exercise any remedies against the Housing Property due to an Event of Default in connection with the Hallway Parcel or the Parking Parcel. IN WITNESS WHEREOF, the HRA has caused the execution of this instrument as of this day of , 2017. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF GOLDEN VALLEY By: Andy Snope, Chair By: Timothy J. Cruikshank, Director US.110249426.03 STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this ____ day of ___________, 2017, by Andy Snope, Chair and Timothy J. Cruikshank, Director, of The Housing and Redevelopment Authority in and for the City of Golden Valley, a public body corporate on behalf of the organization. Notary Public #5155737 5 US.110315675.08 ___________________________________________________________________________ (RESERVED FOR RECORDING DATA) AMENDED AND RESTATED RECIPROCAL MAINTENANCE, USE, AND EASEMENT AGREEMENT THIS AMENDED AND RESTATED RECIPROCAL EASEMENT AGREEMENT (this “Agreement”) is made and entered into as of the _____ day of ______________, 2017 by and between CORNERSTONE HOUSING LIMITED PARTNERSHIP, a Minnesota limited partnership (“Cornerstone”) and J-HAP Inc., a Minnesota non-profit corporation (“JHAP”) and amends and restates the Reciprocal Maintenance, Use, and Easement Agreement dated January 25, 2016, filed January 27, 2016 with the Hennepin County Registrar of Titles as Document Number T05323033 (the “Original Declaration”). RECITALS A.Cornerstone owns certain real propertylocated in the Cityof Golden Valley, Hennepin County, Minnesota, legallydescribed on Exhibit A attached hereto (the “Housing Parcel”). B.JHAP owns certain real propertyadjacent to the Housing Parcel, legally described on Exhibit B attached hereto (the “CommunityCenter Parcel”). C.Cornerstone has constructed a building on the Housing Parcel (the “Housing”) which includes forty-five (45) rental housing units and related improvements. D.After the Original Declaration was executed, Cornerstone filed a registered land survey subdividing the property it owned and creating the Hallway Parcel and the Parking Parcel, both as defined below. E.The Hallway Parcel is legally described as Tract D, Registered Land Survey No. ____ and is depicted on Exhibit E (the “Hallway Parcel”). F.The Parking Parcel is legally described as Tract C, Registered Land Survey No. _____ and is depicted on Exhibit D (the “Parking Parcel”). US.110315675.08 2 G.Cornerstone has conveyed the Hallway Parcel and the Parking Parcel to JHAP. H.JHAP intends to construct a community center or other improvements on the Community Center Parcel (the “Community Center”) (the Housing and the Community Center are referred to collectively as the “Project”). I.Cornerstone and JHAP desire to subject the Housing Parcel, the Hallway Parcel, the Parking Parcel, and the Community Center Parcel and all future owners of all or any portion thereof to various easements, restrictions and covenants, as further set forth herein, for the purpose of preserving the value and the structural quality of the Project, as defined herein, and to provide for the common use of certain parts of the Project. NOW, THEREFORE, in consideration of the easements, covenants, conditions, restrictions and agreements contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Cornerstone and JHAP agree with each other as follows: 1.Definitions. As used in this Agreement, the following terms shall have the following meanings: 1.1 Access Facilities. “Access Facilities” means the Stairway, the Driveway, the Parking Garage Entrance Drive, the Elevator, the Hallway, hallways, and all other portions of the Project that are designed and intended to provide common access to and from public streets and sidewalks adjacent to the Project, as the same may exist from time to time, and all alterations thereto and replacements thereof. 1.2 Agreement. “Agreement” means this Agreement, including the following exhibits attached hereto and made a part hereof: Exhibit A:Legal Description of Housing Parcel Exhibit B:Legal Description of Community Center Parcel Exhibit C:Depiction of the Project Exhibit D:Depiction of Parking Parcel Exhibit E:Depiction of Hallway Parcel Exhibit F:List of Shared Costs 1.3 City. “City” means the City of Golden Valley, Minnesota. 1.4 Community Center. “Community Center” means the Community Center Parcel and any improvements constructed on the Community Center Parcel. 1.5 Community Center Entrance. “Community Center Entrance” means the entrance to the Community Center located on the Housing Parcel as depicted on Exhibit C and described in Section 3.4. US.110315675.08 3 1.6 Community Center Occupants. “Community Center Occupants” means individuals who attend events or obtain services at the Community Center. 1.7 Community Center Owner. “Community Center Owner” means the owner of the Community Center Parcel, Community Center, the Hallway Parcel, the Garage Parcel, and the improvements located therein, its successors and assigns. 1.8 Community Center Parcel. “Community Center Parcel” means the real property legally described on Exhibit B. 1.9 Constant Dollars. “Constant Dollars” shall mean the value of the U.S. dollar to which such phrase refers, as adjusted from time to time. An adjustment shall occur on the 1 st day of June, 2021 and thereafter at five (5) year intervals. Constant Dollars shall be determined by multiplying the dollar amount to be adjusted by a fraction, the numerator of which is the Current Index Number and the denominator of which is the Base Index Number. The “Base Index Number” shall be the Index for April 2006; the “Current Index Number” shall be the Index for April of the adjustment year; the “Index” shall be the Consumer Price Index for All Urban Consumers, published by the Bureau of Labor Statistics of the United States Department of Labor for U.S. City Average, All Items (1982-84=100), or any successor index thereto as hereinafter provided. By way of example, if in June 2011, the amount of $500 is to be converted to Constant Dollars, then $500 shall be multiplied by the following fraction: Current Index Number for June 2021 ÷ Base Index Number for June 2016 = Constant Dollars If publication of the Index is discontinued, or if the basis of calculating the Index is materially changed, then the Owners shall substitute for the Index comparable statistics as computed by an agency of the United States Government or, if none, by a substantial and responsible periodical or publication of recognized authority most closely approximating the result which would have been achieved by the Index. 1.10 Courtyard. “Courtyard” means the lawn, plaza, and back porch areas as shown on Exhibit C. 1.11 Driveway. “Driveway” means the driveway in front of the Housing as shown on Exhibit C. 1.12 Elevator. “Elevator” means the elevator for the use by Housing Owner and the Community Center Owner and the Community Center Occupants as set forth in Section 3.6 passing through the Housing as depicted on Exhibit C. 1.13 Elevator Access. “Elevator Access” means the residential lobby and hallways used to get from the Elevator to the Community Center. 1.14 Final Plans. “Final Plans” means the as-built plans and specifications for the Project. US.110315675.08 4 1.15 Garage. “Garage” means the garage which consists of the 9 parking spaces in the Housing Parcel and the 35 parking stalls in the Parking Parcel, together with associated driveways. 1.16 Governmental Authorities. “Governmental Authorities” means all federal, state, county, municipal and local governments, and all departments, commissions, boards, bureaus and officers thereof, having jurisdiction over the Project. 1.17 Hallway. “Hallway” means the hallway located in the Hallway Parcel to access the Community Center as depicted on Exhibit C. 1.18 Hallway Parcel. “Hallway Parcel” has the meaning set forth in Recital E. 1.19 Hazardous Substances. “Hazardous Substances" means any substance, chemical, waste, contaminant, pollutant or other material that is or becomes regulated by any federal, state or local governmental authority because of its toxicity, infectiousness, radioactivity, explosiveness, ignitability, corrosiveness or reactivity, including, without limitation, those substances regulated by the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et. seq.; the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et. seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601 et. seq.; the Clean Water Act, 33 U.S.C. § 1321 et. seq.; and the Clean Air Act, 42 U.S.C. § 7401 et. seq. 1.20 Housing. “Housing” means the Housing Parcel improvements to be constructed on or within the Housing Parcel. 1.21 Housing Occupants. “Housing Occupants” means the Occupants of a residential unit in the Housing. 1.22 Housing Owner. “Housing Owner” means the Owner of the Housing Parcel and the Housing, its successors and assigns. 1.23 Housing Parcel. “Housing Parcel” means the real property legally described on Exhibit A. 1.24 Insurance Requirements. “Insurance Requirements” means all terms of any insurance policy covering or applicable to a Parcel or any part thereof, all requirements of the issuer of any such policy, and all orders, rules, regulations and other requirements of the National Board of Fire Underwriters (or any other body exercising similar functions) applicable to or affecting a Parcel or any part thereof or any use or condition of the Project or any part thereof. 1.25 Legal Requirements. “Legal Requirements” means all laws, statutes, codes, acts, ordinances, orders, judgments, decrees, injunctions, directions and requirements of all Governmental Authorities, foreseen and unforeseen, ordinary or extraordinary, which now or at any time hereafter may be applicable to or required in connection with the Project or any part thereof, or any of the adjoining sidewalks, or any use or condition of the Project or any part thereof, or any construction required or permitted by this Agreement. US.110315675.08 5 1.26 Major Event. “Major Event” means an event at the Community Center which will require public parking in the Garage. 1.27 Occupant. “Occupant” means any person from time to time entitled to the use and occupancy of any portion of the Project under an ownership right or any lease, sublease, license, concession, or other similar agreement. 1.28 Owner. “Owner” means the Community Center Owner or the Housing Owner, their successors and assigns. 1.29 Parcel. “Parcel” means the Housing Parcel, the Parking Parcel, the Hallway Parcel, or the Community Center Parcel, as the context indicates. Used in the plural form, the term shall mean both the Housing Parcel and the Community Center Parcel. 1.30 Parking. “Parking” means the improvements located in the Parking Parcel as depicted on Exhibit D. 1.31 Parking Garage Entrance Drive. “Parking Garage Entrance Drive” means the ramp located on the Community Center Parcel designed for vehicular ingress and egress to and from the Garage, as shown on Exhibit C. 1.32 Permittee. “Permittee” means all Occupants and the officers, directors, employees, agents, contractors, customers, vendors, suppliers, visitors and invitees of Occupants to the extent their activities relate to the intended development, use and occupancy of the Project as limited by this Agreement. 1.33 Project. “Project” means the Housing, the Community Center, the Hallway, and the Parking. The floor plan of the Project is attached hereto as Exhibit C. 1.34 Rules. “Rules” means the rules from time to time established for common space in or joint use of the Project or a portion thereof by Housing Owner and Community Center Owner pursuant to Section 16. 1.35 Security System. “Security System” means the system used to monitor access through the Housing. 1.36 Shared Costs. “Shared Costs” means the costs of maintenance for any items listed in Exhibit F. 1.37 Stairway. “Stairway” means the stairway used for ingress and egress to the Community Center from the Garage through the Housing as depicted on Exhibit C. 1.38 Surface Lot. “Surface Lot” means the surface parking lot on the Housing Parcel as shown on Exhibit C. US.110315675.08 6 1.39 Term. “Term” shall mean the term of this Agreement, which shall commence on the date first above written and shall terminate on the date ninety-nine (99) years thereafter. 1.40 Unavoidable Delays. “Unavoidable Delays” means delays in the performance of obligations under this Agreement due to causes beyond the control of the Owner performing the obligation, including but not limited to acts of God, acts of the public enemy, acts of terrorism, the direct result of strikes, walkouts and lockouts, fire, floods, epidemics, quarantines, restrictions, unavailability of power, unavailability of materials, acts of governmental entities including legislative or administrative actions taken by any entity, unusually severe weather not reasonably foreseeable or delays of contractors and subcontractors due to such causes, or other casualty to the Project or a portion thereof, litigation which by injunction or other similar judicial action directly results in delays, provided that no such occurrence shall constitute an “Unavoidable Delay” unless such Owner gives written notice of such occurrence to the other Owner within thirty (30) days of the date of its first occurrence, and provided further that for each day of occurrence of such cause beyond the control of the Owner performing an obligation, one day of Unavoidable Delay shall be granted under this Agreement. 1.41 Utility Facilities. “Utility Facilities” means utility delivery systems and facilities providing utility, sewer service for sanitary sewers, storm sewers and drains; roof drains; water and gas mains and feeder lines; electrical power trunk lines and feeder lines, telephone trunk lines and feeder lines, lines and facilities providing steam and chilled water; and any other lines, ducts, shafts, machinery and equipment (including those affording connections to sources outside the Project) for such purposes, together with all replacements of such facilities. 2.Covenants. 2.1 General Provisions. Housing Owner and Community Center Owner hereby declare that the Project is, and will be, held, transferred, sold, conveyed and occupied subject to the restrictions and covenants of this Agreement, which restrictions and covenants (i) are for the purpose of protecting the value, desirability and amenities of the Project and (ii) will operate as equitable covenants, restrictions and reservations that will run with the Housing Parcel and Community Center Parcel, be binding on all Owners having any right, title or interest in the same, their heirs, successors and assigns, and inure to the benefit of each of such other Owners; and (iii) are imposed upon the Project. 2.2 Construction of Project. Intentionally Omitted. 2.3 Use of Housing Parcel. The Housing Parcel may only be used for residential uses, including services for the Occupants of the Housing Parcel and related uses. 2.4 Use of Community Center and Hallway. The Hallway may only be used for access to the Community Center. The Community Center may only be used as a community building for private, family and community-wide events and meetings, community education, activities for the Occupants of the Housing, and related activities, but specifically excluding the following uses: US.110315675.08 7 (a) any manufacturing, distilling, refining, smelting, agricultural or mining operation; (b) any dumping, disposing, incineration or reduction of garbage; (c) any bowling alley or skating rink; (d) any mortuary or funeral home; (e) any establishment selling or exhibiting “obscene” material; (f) any establishment selling or exhibiting drug-related paraphernalia; (g) any establishment which exhibits, either live or by other means to any degree, nude or partially clothed dancers or wait staff; (h) any gambling facility or operation, including, but not limited to: off-track or sports betting parlor; table games such as blackjack or poker; slot machines, video poker/blackjack/keno machines or similar devices; or bingo hall; (i) any auto repair facility; (j) any gun shop; or (k) any tattoo parlor. 2.5 Parking. The Garage may only be used in a manner consistent with residential parking and private community center facilities, except as otherwise expressly provided herein. The Garage shall not be used for any commercial activities or storage. 2.6 Exterior Appearance. No Owner shall materially modify the exterior of the Project, without the written consent of the other Owner, which consent shall not be unreasonably withheld, conditioned or delayed. This limitation extends to the Occupants and Permittees of the Project. 3.Easements. 3.1 General Provision. This Article 3 sets forth the easements granted and reserved with respect to each Parcel. Unless otherwise specifically stated, each easement granted to Housing Owner is for the benefit of Housing Owner and Housing Owner’s Occupants, successors and assigns, as an appurtenance to the Housing Parcel and is binding on, enforceable against and burdens the Community Center Parcel. Unless otherwise specifically stated, each easement granted to the Community Center Owner is for the benefit of Community Center Owner and Community Center Owner’s Occupants, successors and assigns, as an appurtenance to the Community Center Parcel and is binding on, enforceable against and burdens the Housing Parcel. If no single Parcel is identified as the beneficiary of an easement, then the easement is for the benefit of, and appurtenant to, all Parcels. Unless otherwise specifically stated herein, all US.110315675.08 8 easements granted herein are for the Term, are nonexclusive and may be used without any charge or fee. All easements are subject to the terms and conditions of this Agreement. 3.2 Temporary Construction Easements. Intentionally Omitted. 3.3 Easement for Building Encroachments and Abutments. Subject to the terms and conditions of this Agreement, each Owner, with respect to its Parcel(s), hereby grants and conveys to the other easements (i) for such building encroachments as may inadvertently occur upon the adjoining Parcel by reason of the construction or reconstruction of the Project or from sag or variance occurring after any such construction or reconstruction, (ii) for such building encroachments as may occur because of irregular surface and minor variation in dimensions; and (iii) to have structures on any boundary common to the Parcels abut and connect to the structure on the grantor’s Parcel. The grant of the foregoing easements shall not excuse either Owner from exercising diligence to complete construction on and within its Parcel. 3.4 Easement for Community Center Entrance, and Stairway. Subject to the terms and conditions of this Agreement, Housing Owner hereby grants and conveys to Community Center Owner an easement for ingress and egress over and upon the Housing Parcel to access the Hallway and for maintenance and use of the Community Center Entrance and Stairway, provided that the Owner of the Housing Parcel may establish reasonable restrictions on access hours and security procedures. 3.5 Easement for Utility Facilities. (a)Subject to the terms and conditions of this Agreement, Housing Owner herebygrants and conveys to CommunityCenter Owner an easement for the operation, maintenance, repair, passage and use of the Utility Facilities on the Housing Parcel that serve the Community Center Parcel, the Hallway Parcel, and the Parking Parcel, including but not limited to electrical service, telecommunications, natural gas and plumbing. (b)The installation or modification of any Utility Facility shall be subject to the prior approval of the Housing Owner, which approval shall not be unreasonably withheld. (c)The easements granted in this Section shall be fixed as to location, but may be relocated by the Housing Owner, but only in such manner as (i) shall not disturb or interfere with the utility service to the Community Center, the Hallway, and the Parking any more than is absolutely necessary under the circumstances; (ii) shall not reduce or unreasonably impair the usefulness or function of such Utility Facility; (iii) shall be performed without cost or expense to the Community Center Owner; (iv) shall be completed using materials and design standards that equal or exceed those originally used; and (v) shall have been approved by the provider of such service, if any. (d)Housing Owner and Community Center Owner agree to maintain the Utility Facilities in their respective portion of the Project in a manner reasonably designed US.110315675.08 9 to maintain continuous utility service subject to such temporary interruptions of service as are necessary to complete the activities permitted by this Agreement. (e)No grantor nor any of its Permittees shall be liable to the grantee or to any person or entity for, and such grantor and its Permittees are hereby released from, any and all consequential damage for any interruption in any services provided through Utility Facilities located in the easement granted by the grantor, regardless of cause, including such grantor’s negligence or that of its Permittees. (f)In the event that Housing Owner fails to maintain the Utilities serving the Hallway Parcel and the Parking Parcel, Community Center Owner may perform such maintenance and the Housing Owner shall pay the Community Center Owner 81% of the reasonable cost of the maintenance. 3.6 Easement for Elevator. Subject to the terms and conditions of this Agreement, Housing Owner herebygrants and conveys to CommunityCenter Owner an easement for use of the Elevator and for ingress and egress to the Elevator from the Garage through the Elevator Access. This easement area is depicted on Exhibit C attached hereto. 3.7 Easement for Courtyard. Subject to the terms and conditions of this Agreement, Housing Owner hereby grants and conveys to the Community Center Owner an easement for use of the Courtyard, including a reasonable path of ingress and egress from the Community Center Entrance to the Courtyard. Community Center Owner hereby grants and conveys to Housing Owner an easement for use of the Courtyard. The Owners shall establish a system for scheduling events in the Courtyard and shall establish rules for such use. The Housing Parcel shall have primary use of the Courtyard between 8 A.M. and 4 P.M. No events shall be held in the Courtyard between 11 P.M. and 8 A.M. 3.8 Easement for Driveway. Subject to the terms and conditions of this Agreement, Housing Owner hereby grants and conveys to Community Center Owner a non- exclusive easement to use the Driveway for dropping off passengers at the Community Center Entrance. 3.9 Easement for Parking Garage Entrance Drive. Subject to the terms and conditions of this Agreement, Housing Owner hereby grants and conveys to Community Center Owner and its Occupants a non-exclusive easement for ingress and egress over the Parking Garage Entrance Drive into the Garage. Housing Owner shall be solely responsible for the maintenance of the Garage driveway entrance. 3.10 Easement for Parking. Subject to the terms and conditions of this Agreement, Housing Owner hereby grants and conveys to Community Center Owner a non- exclusive easement for parking on the Surface Lot, provided that Housing Owner may reserve up to ten (10) spaces for exclusive use by the Owner of the Housing and Housing Occupants. The Community Center Owner hereby grants and conveys to the Housing Owner an easement over the driveways in the Parking Parcel to access the parking in the Housing Parcel. The Housing US.110315675.08 10 Owner hereby grants and conveys to the Community Center Owner an easement over the driveways in the Housing Parcel for access to the Parking Parcel. 3.11 No Dedication. Nothing contained herein may be deemed to be a gift or dedication of any portion of the Project to the general public, and the grantor of any easement or license under this Agreement is entitled to make such temporary closures as may be reasonably necessary to avoid creation of any public rights. 3.12 Security Restrictions. All of the easements granted in this Agreement are subject to reasonable access restrictions, which may be in the form of access controls through the Security Access System or by Rules promulgated pursuant to Article 15, provided that no such restrictions shall unreasonably impair the utility of the easements granted herein. Without limitation of the generality of the foregoing, Housing Owner and Community Center Owner acknowledge that the need to protect the Occupants of the Housing may require special security measures. 4.Utilities. 4.1 Electricity. Other than the Parking Parcel and the Hallway Parcel, the electrical systems for the Community Center Parcel and the Housing Parcel are separately metered, and each Owner shall pay the cost for its Parcel directly to the utilities that it uses. 4.2 Natural Gas. Other than the Parking Parcel and the Hallway Parcel, the natural gas systems for the Community Center Parcel and the Housing Parcel are separately metered, and each Owner shall pay the cost for its Parcel directly to the utility. The Owners agree to disregard the natural gas services to the Courtyard or other easement areas. 4.3 Water. Other than the Parking Parcel and the Hallway Parcel, the water systems for the Community Center Parcel and the Housing Parcel are separately metered, and each Owner shall pay the cost for its Parcel directly to the utility. The Owners agree to disregard the water service to the Courtyard or other easement areas. 4.4 Utilities for Hallway Parcel and Garage Parcel. The cost of utilities for the Hallway Parcel and Parking Parcel are allocated in the Shared Costs or shall be allocated as otherwise agreed to in writing by the Housing Owner and the Community Center Owner. 5.Alterations. 5.1 Permitted Alteration. Each Owner may make such alterations to its portion of the Project on a Parcel that it owns as it may from time to time determine without the consent or approval of the other Owner, subject to the provisions of Sections 5.2 and 5.3 and to all other applicable provisions of this Agreement. 5.2 Consent Required. No alteration shall be made to any part of the Project without the prior written consent of the other Owner if the proposed alteration would: (a) impair any of the rights expressly granted in this Agreement; US.110315675.08 11 (b) change the general character of the Project; (c) materially affect the exterior appearance of the Project; (d) involve a material structural alteration or materially affect the Support Facilities; or (e) adversely and unreasonably affect an Owner’s quiet enjoyment of its portion of the Project. 5.3 Other Requirements. Each Owner hereby covenants that it will comply with the following provisions: (a) All alterations shall be made with reasonable diligence and dispatch (subject to Unavoidable Delays) in a workmanlike manner and with materials and workmanship equal in quality and class to the Building. (b) Before beginning any alterations, the Owner desiring the alteration shall procure, at its expense, all necessary licenses, permits, approvals and authorizations from all Governmental Authorities and, except in the case of an alteration not requiring consent, shall deliver photocopies thereof to the other Owner. Upon request, the other Owner shall join in the application for such licenses, permits, approvals and authorizations whenever such action is necessary, and the Owner desiring the alterations covenants that the other Owner will not suffer, sustain or incur any cost, expense or liability by reason thereof. (c) All alterations shall be made and completed in accordance with all Legal Requirements and Insurance Requirements. 6.Maintenance and Repair. 6.1 Generally. Subject to express provisions herein for cost allocation between the Owners, except for the Hallway Parcel and the Parking Parcel, each Owner shall, at its sole cost and expense and without contribution from the other, maintain its portion of the Project in a good state of repair and condition, ordinary wear and tear excepted, make all necessary repairs thereto, interior and exterior, structural or non-structural, and keep the same in compliance with all Insurance Requirements, Legal Requirements and the Rules. The requirements of this Section shall include, without limitation: (a) Each Owner shall, at its expense, maintain and repair in good order and condition all Utility Facilities in its Parcel(s); and (b) Except as otherwise expressly set forth herein, each Owner shall maintain at its expense its respective heating and cooling systems for its portion of the Project. All repairs shall be equal in quality and class to the original work, effected with all due diligence and in a workmanlike manner, and promptly and fully paid for by the Owner of US.110315675.08 12 the portion of the Project in question. Notwithstanding anything herein to the contrary, the Owners hereto shall be liable individually for those maintenance and repair expenses caused or occasioned by their respective acts or omissions or the acts or omissions of their Permittees who cause any extraordinary repair or maintenance expenses. 6.2 Maintenance of Stairway. Housing Owner shall maintain the Stairway at its expense. 6.3 Maintenance of Elevator. Housing Owner shall be solely responsible for the maintenance of Elevator. Community Center Owner shall pay 20% and Housing Owner shall pay 80% of the cost of the maintenance. 6.4 Maintenance of Hallway Parcel and Parking Parcel. The Housing Owner shall maintain the Hallway Parcel and the Parking Parcel and the Community Center Owner shall reimburse the Housing Owner for all reasonable costs related thereto. 6.5 Maintenance of Sidewalks. Housing Owner shall maintain the sidewalks on the Housing Parcel in good condition, including removal of debris and snow. Housing Owner shall pay all of such costs. Housing Owner shall pay 80% and Community Center Owner shall pay 20% of the cost of replacement of sidewalks on the Housing Parcel. Community Center Owner shall maintain and pay for the maintenance of any sidewalks on the Community Center Parcel. 6.6 Cost Allocation. (a) The costs of operating and maintaining the improvements that are the subject of or contained within the easements described in this Agreement will be allocated among the Parcels in the manner expresslyset forth herein or if not expresslyset forth in this Agreement as set forth on Exhibit F attached hereto. (b) The Owners mayfrom time to time alter the maintenance obligations and allocation of costs bya written agreement signed byboth Owners without amending this Agreement. Anysuch written agreement shall be terminable on thirty(30) days written notice unless a separate time period is expresslystated. (c) With respect to Shared Costs (as identified in Exhibit F), the Owner that is not responsible for performing the maintenance will payto the other Owner the applicable share of the Shared Costs as shown on Exhibit F. Except in an emergency, neither Owner will undertake anyShared Cost without the consent of the other Owner, which consent will not be unreasonablywithheld or delayed, and will be deemed given except to the extent the other Owner makes specific written objection thereto within ten (10) days after deliveryof the written request. The Owner that did not incur the Shared Cost will payto the other Owner its applicable share of the Shared Cost within thirty(30) days after submission of a statement bythe Owner that performed the work, together with reasonablyacceptable evidence of the actual cost incurred for the Shared Cost. Each Owner shall keep accurate and complete books and records of the Shared Costs incurred byit. Within one (1) year US.110315675.08 13 after receipt of anyrequest for payment, the Owner that did not perform the applicable work shall have the right to inspect, audit, and/or copysuch books and records to the extent pertaining to such costs paid or payable bythe Owner that performed the work in the calendar year covered bysuch statement. Such Owner will notifythe other of its intent to audit at least fifteen (15) days before the date it desires to make such inspection, audit, or copying. If such audit discloses anyerror in the determination of Shared Costs, the Owners shall make an appropriate adjustment. The reasonable cost of anyaudit shall be paid bythe Owner requesting it unless that Owner is entitled to a refund in excess of ten percent (10%) of the amount originallycalculated as the auditing Owner’s allocable share for the applicable calendar year, in which case the audited Owner shall paythe cost of such audit. (d) In addition to paying the Shared Costs, the Community Center Owner shall either arrange for staffing, as reasonably required by the Housing Owner, or reimburse the Housing Owner for staffing required for (a) interior security between the Elevator and the Community Center, and (b) monitoring the entrance to the Garage or providing valet parking in the Garage. The Housing Owner and the Community Center Owner will develop a plan for staffing Major Events. 6.7 Standards for Maintenance. In performing its obligations under this Agreement, each Owner shall preserve and maintain the appearance of the Project as initially designed and constructed, and shall perform all maintenance in accordance with the Standard, including but not limited to preserving the functional performance of the Building exterior. 7.Insurance. 7.1 Generally. Each Owner shall obtain and keep in full force and effect, at its sole cost and expense, as to its portion of the Project, except that the Housing Owner shall maintain property insurance on the Hallway and Parking: (a) a policy of commercial general liability insurance written on an “occurrence basis”, not a “claims basis”, under which policythe other Owner shall be named as an additional insured, and with coverage limits of not less than $2,000,000 in Constant Dollars for each occurrence of injuryor propertydamage and $2,000,000 in Constant Dollars in the aggregate and anyamounts in excess of $1,000,000 maybe provided through an umbrella policy; and (b) a policy of property insurance with “all-risk” coverage in the amount of one hundred percent (100%) of the full replacement value of all improvements. All insurance required under this Section shall be procured from companies authorized to do business in the State of Minnesota. Each Owner agrees to furnish to the other Owner a certificate of insurance, evidencing that the insurance required hereunder is in full force and effect, and to make a copy of each policy available for inspection upon request. Each Owner shall deliver to other Owner a certificate of insurance upon recording of this Agreement and shall provide additional proof of such insurance annually. US.110315675.08 14 7.2 Additional Requirements. The insurance required pursuant to Section 7.1 shall include the following provisions: (a) the policy shall not be canceled, or reduced in amount or coverage below the requirements of this Agreement, nor shall it be allowed to expire, without prior notice of at least thirty (30) days by the insurer to each insured and to each additional insured; (b) severability of interests; (c) an act or omission of the insured or additional insured that would void or otherwise reduce coverage shall not void or otherwise reduce the coverage as to the other insured; and (d) contractual liability coverage with respect to the indemnity obligations set forth in this Agreement. 7.3 Waiver of Claims. Each Owner waives any and all claims and rights of action it may have against the other Owner and any of the other Owner’s Permittees with respect to any losses or claims arising out of any damage to its Building or Parcel covered by a commonly available “all risk” form of insurance policy, including flood and earthquake, whether or not such damage was caused by the negligence or other act or omission of the other Owner or the other Owner’s Permittees, and whether or not any such damage to its portion of the Project was caused by or a result of an occurrence on any other portion of the Project. 7.4 Insurance Proceeds. Subject to Section 9, all property insurance proceeds shall be the property of the Owner whose portion of the Project was damaged; provided, however, that if such insurance proceeds exceed $100,000 in Constant Dollars, they shall remain the property of the pertinent Owner but shall be paid into an escrow jointly established by Housing Owner and Community Center Owner to assure application of such proceeds to costs of repair and restoration. In addition, the Housing Owner shall be entitled to all insurance proceeds attributable to the Hallway and Parking to the extent required to reconstruct the Housing, Hallway, and Parking. 8.Indemnification. Subject to Section 7.3 and except as otherwise expressly provided herein, each Owner hereto shall exercise the rights granted to it herein with due care, and shall indemnify, defend, protect and hold harmless the indemnified Owner and its Permittees from and against any and all claims, costs and liabilities (including reasonable attorneys’ fees and costs) arising from property loss or damage or personal injury or death occurring on the Project by reason of any act or omission of the indemnifying Owner or its Permittees, except for claims, costs and liabilities to the extent arising from the negligence or willful misconduct of the indemnified Owner or its Permittees. 9.Fire or Other Casualty. 9.1 Duty to Restore. Promptly upon any loss or damage to all or any part of the Project, the Owner whose portion of the Project was damaged shall give written notice of the US.110315675.08 15 damage to the other Owner. Subject to Section 9.2, each Owner shall proceed with diligence to restore its portion of the Project as follows: (a) Each Owner shall restore its portion of the Project so that it is suitable for operation for the use permitted pursuant to Sections 2.3 and 2.4 respectively, provided that the Housing Owner shall restore the Hallway and the Parking. Such restoration need not be identical to the Project prior to the damage so long as it otherwise complies with all provisions of this Agreement; and (b) Each Owner shall promptly commence and diligently and continuously complete the restoration pursuant to the construction drawings and plans, which plans must be approved by the other Owner to the extent the construction of such elements directly affects the other Owner’s Parcel. 9.2 Catastrophic Damage. If the cost to repair or rebuild the damage to or destruction of the Project exceeds 80% of the fair market value of the Project immediately prior to the casualty, excluding land value, either Owner may elect not to rebuild its portion of the Project. (a) If both Owners elect not to rebuild, the Owners shall immediately clean up the land, remove all debris and return the land and any salvageable portions of the Building that they elect to retain to a safe and usable condition. (b) If one Owner, but not both, elects to rebuild, the Owner that elects not to rebuild (the “Non-Rebuilding Owner”) shall automatically grant to the other Owner (the “Rebuilding Owner”) an option to purchase the Parcel of the Non-Rebuilding Owner for the fair market value of such Parcel in its then as-is condition. Each Owner grants the other Owner a temporary construction easement to be exercised in the same manner as the temporary construction easement set forth in Section 3.2 to the extent necessary to complete the restoration. 10.Condemnation. In the event of a condemnation of the Project or any portion thereof, the award or purchase price paid for such taking shall be paid to the Owner of the condemned Parcel. Each Owner grants the other Owner a temporary construction easement to be exercised in the same manner as the temporary construction easement set forth in Section 3.2 to the extent necessary to complete the restoration. The easement shall terminate upon completion of the restoration. Except as set forth above, each Owner hereby releases and waives any right to receive or claim any portion of such award or purchase price paid to the other Owner for such taking. 11.Default. If either Owner defaults in anyobligation hereunder that can be cured bythe payment of moneyand the default is not cured within thirty(30) days after written notice thereof, or if either Owner defaults in anyother obligation in this Agreement and the default continues for thirty(30) days after written notice thereof (or such longer period as may be necessary to cure the default provided that the defaulting Owner commences to cure within the US.110315675.08 16 thirty (30) day period and thereafter diligently prosecutes such cure to completion), then the non- defaulting Owner, after additional notice given to the defaulting Owner, mayexercise anyone or more of the remedies set out in Section 12 hereof. The first mortgagee of anyOwner in default under this Agreement (including the first mortgagee of a condominium unit) shall be entitled to receive a concurrent notice of said default in the same manner that other notices are required to be given under this Agreement; provided however, that the first mortgagee has, prior to the time of the default, delivered written notice of the first mortgagee’s mailing address to the Owner(s) giving the notice of default. 12.Remedies; Waiver. 12.1 General. Upon the occurrence of a default under this Agreement and the expiration of anyperiod to cure without a curing of the default, the non-defaulting Owner shall be entitled to one or more of the following remedies: (a) cure the default and charge the cost thereof to the defaulting Owner, and all such costs shall be payable on demand. (b) specific enforcement, injunctive relief, damages, or anyother remedy available at law or in equity. (c) in the event of anylitigation hereunder, the prevailing Owner shall be entitled to reimbursement of its reasonable costs of litigation, including reasonable attorney’s and expert’s fees. Anyaction seeking one or more forms of relief shall not be a bar to an action at the same or subsequent time seeking other forms of relief. Anydelayin realizing, or failure to realize, on any remedyprovided herein for a default hereunder shall not be deemed a waiver of that default or any subsequent default of similar or different kind, and no waiver of anyright or remedyhereunder shall be effective unless in writing and signed bythe person against whom the waiver is claimed. 13.Self-Help. Each Owner hereby grants to the other Owner an easement to enter upon the Parcel(s) of the other Owner and the improvements located thereon for the purpose of performing an obligation that the other Owner is required to perform under this Agreement but fails or refuses to do and that the non-defaulting Owner then has the right, but not the obligation, to perform with reasonable notice; provided, however, that if the default shall constitute an emergency condition, the non-defaulting Owner, acting in good faith, shall have the right to cure the default upon such advance notice as is reasonably possible under the circumstances or, if necessary in the case of emergency, without advance notice, so long as notice is given as soon as possible thereafter. If an Owner takes curative measures, the defaulting Owner shall, upon demand, immediately pay to the non-defaulting Owner its pro rata share of all reasonable costs and expenses actually incurred by the non-defaulting Owner with respect to such curative action. Written demand for payment shall include a statement of costs and reasonable detail of expenses. US.110315675.08 17 14.Hazardous Substances. No Owner shall use, or permit any other person to use, any Hazardous Substances in, on or about its Parcel, except in the ordinary course of its business operations, and any such use shall at all times be in compliance with all Legal Requirements and Insurance Requirements. Each Owner agrees to defend, protect, indemnify and hold harmless the other Owner and its Permittees, from and against any and all claims, costs and liabilities (including, without limitation, reasonable attorneys’ fees and costs, investigation and cleanup costs, governmental response costs, natural resource damages, containment, or other remediation) arising from Hazardous Substances released or allegedly released by the indemnifying Owner or any other person for whose conduct the indemnifying Owner is or may be held responsible. 15.Rules. Housing Owner may establish rules related to use of the Access Facilities subject to the approval of Community Center Owner, which shall not be unreasonably withheld or delayed, so long as such Rules are consistent with Legal Requirements. The Owners may also mutually establish other rules for use of any other portions of the Project used in common. The Owners shall comply, and shall cause their respective Occupants and Permittees to comply, with the Rules in connection with the ownership, use and occupancy of the Project. The Owners may establish, amend, modify or supplement the Rules from time to time. 16.Estoppel Certificates. Each Owner agrees upon the request of the other to execute and deliver an estoppel certificate addressed to the Owner or Owners as the requesting Owner may specify stating whether this Agreement is in effect, whether it has been amended (and if so, identifying the amendments) and whether, to the knowledge of the certifying Owner, either Owner is in default hereunder (and if so, identifying the defaults). 17.Real Property Taxes. The CommunityCenter Owner shall be responsible for the real propertytaxes due and payable with respect to the CommunityCenter Parcel, including installments of special assessments when due. The Housing Owner shall be responsible for the real propertytaxes due and payable with respect to the Housing Parcel, including installments of special assessments when due. The CommunityCenter Owner shall also payall real propertytaxes due and payable with respect to the Parking Parcel and the HallwayParcel, provided that until December 31, 2043, the Housing Owner will paythe CommunityCenter Owner for the property taxes attributable to the HallwayParcel and the Parking Parcel within ten (10) days after written request bythe CommunityCenter Owner, which request shall include a copyof the propertytax statement for the HallwayParcel and the Parking Parcel. The CommunityCenter Owner shall not request payment more than fifteen (15) days before the taxes are due. 18.Signs. To the extent Legal Requirements limit the aggregate signage on the exterior of the Project, Housing Owner shall be allocated 80% of the permitted signage and CommunityCenter Owner shall be allocated 20% of the permitted signage, provided that the Housing Owner shall be allocated 100% of the signage until the CommunityCenter is constructed. All signage shall complywith Legal Requirements. 19.Mediation. All claims, disputes or other matters in question between Housing Owner and CommunityCenter Owner arising out of or relating to this Agreement or US.110315675.08 18 breach thereof shall be referred to non-binding mediation before, and as a condition precedent to, the initiation of anylegal action provided for herein. Each Owner agrees to participate in up to four hours of mediation. The mediator shall be selected bythe Owners, or if the Owners are unable to agree on a mediator, then either Owner can request the administrator of the Hennepin County District Court Civil ADR Program and/or similar person to select a person from its list of qualified neutrals. The mediation shall be attended byemployees or agents of each Owner having authority to settle the dispute. Each partyshall bear its own expenses related to the mediation, including, without limitation, the costs of anyexperts or legal counsel. All applicable statutes of limitations and all defenses based on the passage of time are tolled while the mediation procedures are pending and for a period of thirty(30) days thereafter. 20.Miscellaneous. 20.1 Agreement Shall Continue Notwithstanding Breach. No breach of this Agreement shall entitle either Owner to cancel, rescind or otherwise terminate this Agreement. However, such limitation shall not affect in anymanner anyother rights or remedies that either Owner mayhave hereunder, or at law or in equity, byreason of a breach. 20.2 Amendment. This Agreement may not be amended or modified without the written consent of the Owners hereto. 20.3 Attorney’s Fees. If either Owner brings an action to enforce or interpret this Agreement, the prevailing Owner in such action shall be entitled to recover reasonable attorney’s fees and court costs, in addition to any other relief granted. 20.4 Commercially Reasonable. With respect to matters arising under this Agreement, each Owner shall act in a commercially reasonable manner except when another standard is expressly provided. Whenever the consent or approval of an Owner is expressly required hereunder, such consent or approval shall not be unreasonably withheld or delayed, unless a different standard is expressly set forth herein. 20.5 Construction. The rules of strict construction shall not apply to this Agreement. This Agreement shall not be interpreted in favor of or against either Owner merely because of its respective efforts in preparing it. Whether or not expressly provided, the term “include” and any variation thereof as used in this Agreement is not limiting and instead means “including but not limited to”, and the term “sole” or “absolute” discretion means an Owner’s sole, unqualified and absolute discretion. 20.6 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. A facsimile copy of a signature shall be as binding as an original signature. 20.7 Covenants Run With the Land. The terms and provisions of this Agreement shall run with the land, and shall be binding upon and inure to the benefit of the US.110315675.08 19 Owners hereto and each successor in title to all or any portion of the Housing Parcel or the Community Center Parcel. 20.8 Effect on Other Agreements. This Agreement does not affect the rights and obligations of the Owners hereto under any other agreement between the Owners or by which the Housing Parcel or the Community Center Parcel is bound. 20.9 Entire Agreement. This Agreement embodies the entire agreement and understanding between the Owners and supersedes any prior oral or written agreements with respect to the matters stated herein. 20.10 Governing Law. This Agreement shall be governed by and construed under the laws of Minnesota. 20.11 Headings. The section headings in this Agreement are inserted for convenience of reference only and shall not in any way affect the meaning or construction of the Agreement. 20.12 Liens. Neither Owner shall permit any liens to attach to the other Owner’s Parcel as a result of any work under the foregoing easements and licenses and shall either bond over or pay and discharge any lien so attaching promptly after demand by the other Owner. 20.13 Merger Not Intended. Common ownership of the Parcels shall not cause this Agreement to be extinguished by operation of merger in whole or in part. 20.14 Minimization of Damages. Each Owner agrees to cause the least possible interference with the activities of the other Owner and its Occupants and Permittees. 20.15 Not a Public Dedication. Nothing contained herein shall be deemed to be a gift or declaration of all or anyportion of the easements created herebyto the general public, and the grantor of an easement or license shall be entitled to make such temporary closures as may be reasonably necessary to avoid creation of any public rights. 20.16 Notices. All notices, requests, demands and other communications required or permitted to be given hereunder must be in writing and deposited in the United States Mail, postage prepaid, or personally delivered, or sent by facsimile with a copy deposited in the United States Mail, to the appropriate address set forth below, or at such other address as either Owner may, from time to time, designate in writing. Each Owner may from time to time designate by written notice to the other Owner not more than two additional entities with an interest in the property (lenders, investors, insurers) to receive notice hereunder. Notices shall be deemed sufficiently served or given on the date dispatched in a manner provided above. The initial addresses of the Owners shall be: With respect to Housing Owner: US.110315675.08 20 Community Housing Development Corporation 614 North First Street, Suite 100 Minneapolis, MN 55401 Attn.: Elizabeth Flannery With respect to Community Center: J-HAP Inc. 13100 Wayzata Boulevard, Suite 300 Minnetonka, MN 55305 Attn.: Linda Bialick 20.17 Relationship of Owners. No provision of this Agreement and no action taken pursuant hereto shall create any relationship between the Owners other than as specifically set forth herein. Without limiting the generality of the foregoing, the Owners are not partners of, or joint venturers with, or agents for, each other. 20.18 Rights Reserved. Except for rights expressly granted to the Owners herein, each Owner reserves all rights in and to the easement areas on its portion of the Project. Each Owner shall continue to enjoy the use of the easement areas for any and all purposes that do not interfere with the other Owner’s use of the easement areas. The rights reserved herein are expressly limited by those actions that might damage the easement areas or prevent easy access thereto. 20.19 Severability. If any term of this Agreement or any application thereof shall be invalid or unenforceable, the remainder of the Agreement and any other application of such term shall not be affected thereby. 20.20 Singular and Plural. Whenever required bythe context of this Agreement, the singular shall include the plural, and vice versa, and the masculine shall include the feminine and neuter genders, and vice versa. 20.21 Time. Time is of the essence of this Agreement and each and all of its provisions. 21.Term. (a) The initial Term of this Agreement shall commence upon the date of this Agreement and shall continue for a period of ninety-nine (99) years. (b) The term of this Agreement shall automatically extend indefinitely for succeeding periods of ten (10) years each unless an Owner gives written notice of termination at least ten (10) years prior to the expiration of the then-current Term. An Owner that gives such notice of termination shall thereupon automatically grant to the other Owner an option to purchase the Parcel of the terminating Owner for the fair market US.110315675.08 21 value of the Parcel of the terminating Owner in its then as-is condition, subject to and in accordance with clause (c) below. IN WITNESS WHEREOF, Housing Owner and Community Center Owner have caused this Agreement to be executed and delivered as of the day and year first above written. US.110315675.08 22 SEPARATE SIGNATURE PAGE FOR RECIPROCAL EASEMENT AGREEMENT CORNERSTONE CREEK LIMITED PARTNERSHIP By: CHDC Cornerstone Creek LLC, General Partner By: Elizabeth Flannery, Chief Manager/President STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this ____ day of __________, 2017, by Elizabeth Flannery, the Chief Manager/President of CHDC Cornerstone Creek LLC, a Minnesota limited liability company, as General Partner of Cornerstone Creek Limited Partnership, a Minnesota limited partnership, on behalf of the limited partnership. Notary Public US.110315675.08 23 SEPARATE SIGNATURE PAGE FOR RECIPROCAL EASEMENT AGREEMENT J-HAP Inc., a Minnesota non-profit corporation By: Linda Bialick, President STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this ___ day of __________, 2017, by Linda Bialick, the President of J-HAP Inc., a Minnesota non-profit corporation, on behalf of the corporation. Notary Public THIS INSTRUMENT DRAFTED BY: Faegre Baker Daniels LLP (AMC) 90 South Seventh Street 2200 Wells Fargo Center Saint Paul, MN 55402-3901 (612) 766-1600 US.110315675.08 EXHIBIT A Legal Description of Housing Parcel Tract B, Registered Land Survey No. _____, Hennepin County, Minnesota. US.110315675.08 EXHIBIT B Legal Description of Community Center Parcel Tract A, Registered Land Survey No. ____, Hennepin County, Minnesota. US.110315675.08 EXHIBIT C Depiction of Project US.110315675.08 EXHIBIT D Depiction of Parking Parcel US.110315675.08 EXHIBIT E Hallway Parcel US.110315675.08 EXHIBIT F Shared Costs Cornerstone Creek Limited Partnership (Housing Space) Jewish Housing and Programming Maintenance of Housing 81%19% underground parking 81%19% elevator maint. & repair 81%19% Maintenance of Community Center 0%100% Utilities for Housing Parcel, Hallway Parcel and Parking Parcel 81%19% Utilities for Community Center, excluding Parking Parcel and Hallway Parcel 0%100% Insurance for Housing 100%0% Insurance for Community Center 0%100% Taxes for Housing 100%0% Taxes for Community Center 0%100% Taxes for the Hallway and Parking Parcel Payable pursuant to Section 17 Payable pursuant to Section 17 Exterior Maintenance of Grounds of Housing Parcel (including landscaping, snow removal, mowing) 50%50%