D-10. Approval of 120-day Extension of Lease Agreement with Roadrunner Truck Repair, Inc. for the old Public Works Building, 1591 Park Road Y 0�
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CITY OF ClIANIIASSEN
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Chanhassen is a Community for Life-Providing for Today and Planning for Tomorrow
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MEMORANDUM
TO: Mayor and City Council
FROM: Greg Sticha, Finance Director
DATE: June 26, 2017 (� '
SUBJ: Approve Extension of Contract for Deed Lease Agreement with Roadrunner Truck
Repair, Inc. located at 1591 Park Road
PROPOSED MOTION:
"The City Council approves the attached agreement for a 120-day extension of the contract for deed
with Roadrunner Truck Repair, Inc. for city property located at 1591 Park Road in Chanhassen."
Approval requires a simple majority vote of the City Council.
BACKGROUND
The city currently holds a contract for deed lease with Roadrunner Truck Repair, Inc., for property
located at 1591 Park Road (old Public Works Building) in Chanhassen. The contract for deed is set
to expire on June 27, 2017,requiring a final payment of the remaining principal ($1.23M). The
current tenant has been working diligently to close on the final purchase of the property for more
than a year. The property was found to have some minor environmental issues that need to be
remediated before the closing on the sale of the property can be concluded. The installation of a
venting system to remediate the issue is currently being undertaken by the tenant.
The tenant is asking for a 120-day extension to finish all the phases of the installation of the
remediation system and to prepare all final and closing documents. Staff has met with the tenant and
agreed to the extension under the same terms of the current contract for deed.
RECOMMENDATION
It is recommended that the city council approve the attached agreement with Roadrunner Truck
Repair, Inc. for a 120-day extension of the contract for deed for city property located at 1591 Park
Road in Chanhassen.
ATTACHMENTS
1. Contract for deed extension.
2. Cash Inflows and Outflows.
PH 952.227.1100• www.ci.chanhassen.mn.us • FX 952.227.1110
7700 MARKET BOULEVARD • PO BOX 147 • CHANHASSEN • MINNESOTA 55317
(Reserved for Recording Data)
AMENDMENT OF CONTRACT FOR DEED
THIS AMENDMENT OF CONTRACT FOR DEED (the "Amendment") is made and
entered into as of the day of June, 2017 by and between CITY OF CHANHASSEN, a
Minnesota municipal corporation, Seller, and ROADRUNNER TRUCK REPAIR INC., a
Minnesota corporation, Purchaser.
RECITALS :
WHEREAS, the Purchaser and the Seller are parties to a Contract for Deed dated June 27,
2012 covering real property legally described on Exhibit A attached hereto and made a part hereof,
which Contract for Deed was recorded in the Office of the County Recorder, Carver County,
Minnesota on September 28, 2012, as Document No.A562953; and
WHEREAS, Seller has requested an extension of time for the full payment of the Purchase
Price under the Contract for Deed to complete the process of remediation through the MPCA and to
avoid a default in the Contract for Deed; and
WHEREAS, the Property has environmental issues that must be addressed before the
Property can be fully developed. Because the City owned the Property for approximately 30 years
prior to sale, it desires to provided limited assistance in the costs of remediation of the
environmental issues; and
WHEREAS, the Seller is agreeable to amending the terms, covenants and conditions of the
Contract as requested by the Purchaser solely according to the terms, covenants and conditions of
this Amendment.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained,the receipt and sufficiency of which are hereby acknowledged, it is agreed by
the parties hereto as follows:
1. Amendment of Paragraph 6 of the Contract for Deed. Paragraph 4(b) of the
Contract for Deed is amended to read as follows:
193133v1 1
(b) BALANCE OF PURCHASE PRICE. The remaining balance of the Purchase Price
shall be paid in equal monthly installments, which payments include principal and interest
accruing on the Purchase Price at the Interest Rate (which amount represents monthly
payments of the Purchase Price accruing interest at the Interest Rate and amortized over a
period thirty (30) years) commencing on the Contract Date and continuing the same day of
each month thereafter for 64 months, at which time the entire unpaid balance of the principal
and accrued interest shall be due and payable in full, all as set forth on the payment
scheduled attached as Exhibit B hereto and made a part hereof. Payments shall be credited
first to interest and the remainder to principal. Interest shall accrue at the Interest Rate from
the Contract Date. The last payment shall be a balloon payment.
2. Amendment of Paragraph 22 of the Contract for Deed. Paragraph 22 of the Contract
for Deed is amended to read as follows:
22. ENVIRONMENTAL.
(a) Purchaser shall not bring, store, generate, or treat hazardous wastes or
substances or petroleum products upon the Property, except for small quantities which are stored
and used in compliance with applicable law. Purchaser hereby agrees to indemnify, defend and
hold Seller harmless from any and all claims,demands, actions, causes of action, and liabilities.
(b) Upon payment of the balloon payment provided under Paragraph 4, Seller
will pay to Purchaser up to $19,000.00 towards remediation of the environmental issues located on
the Property reviewed by the MPCA upon receipt by Seller of payment of claims by Purchaser for
such remediation.
3. Amendment of Exhibit B of the Contract for Deed. Exhibit B of the Contract for
Deed is amended as attached to this Amendment.
4. Terms of Contract. The Contract is hereby amended and modified to the extent
necessary to be consistent with the provisions of this Amendment. To the extent that this
Amendment conflicts with the Contract, the provisions of this Amendment shall prevail. To the
extent not otherwise modified or amended by this Amendment, all of the other terms, covenants and
conditions of the Contract shall remain in full force and effect.
(Remainder of page intentionally left blank. Signature pages to follow)
193133v1 2
SELLER:
CITY OF CHANHASSEN
BY:
Denny Laufenburger, Mayor
AND
Todd Gerhardt, City Manager
STATE OF MINNESOTA )
)ss.
COUNTY OF CARVER )
The foregoing instrument was acknowledged before me this day of
, 2017, by Denny Laufenburger and by Todd Gerhardt, respectively the Mayor
and City Manager of the City of Chanhassen, a Minnesota municipal corporation, on behalf of the
corporation and pursuant to the authority granted by its City Council.
Notary Public
193133v1 3
I
PURCHASER:
ROADRUNNER TRUCK REPAIR, INC.
BY:
ITS: President
STATE OF MINNESOTA )
)ss.
COUNTY OF CARVER )
The foregoing instrument was acknowledged before me this day of
, 2017, by , the President of Roadrunner Truck
Repair, Inc., a Minnesota corporation, on behalf of the corporation.
Notary Public
TAX STATEMENTS FOR THE REAL
PROPERTY DESCRIBED IN THIS
INSTRUMENT SHOULD BE SENT TO:
THIS INSTRUMENT WAS DRAFTED BY:
CAMPBELL KNUTSON, P.A.
860 Blue Gentian Road, Suite 290
Eagan, Minnesota 55121
Telephone: 651-452-5000
[AMP]
193133v1 4
EXHIBIT A
Legal Description of Property
Lots 10 and 11, Block 5, CHANHASSEN LAKES BUSINESS PARK, Carver County, Minnesota,
according to the recorded plat thereof.
193133v1 5
EXHIBIT B
Schedule of Payments
Total purchase price 1,475,000 Monthly CD payment 7,757.07
Down payment 102,000
Down Payment Contract for Decd
Payment Balance Principal Add.Prreeipal to creno !balance
Closing Aug-1.2 30,000.00 72,000,00 1,445,000,03
Month I Aug-12 4,000,00 68,000,00 1,736.24 6,020-83 1,439.263.76
Month2 Sep-12 4,00000 64,000.00 1,760.14 5.996593 1,433,503,62
.- Oco-12 4,000.04 60,000.00 1,784,14 5,972.93 1,427,719.48
Nov-12 4,000 CO 56,000.00 1,808,24 5,948.83 1,421,911.24
Dna-12 4,000.00 52,000.00 1,832,44 5;92463 1,416,07830
Jan-13 1,677.42 50.322.58 1.856.74 5,900,33 1,412,544.64
Feb-13 1,677,42 48,645 36 1,871 47 5,885.60 1,408,995.75
Mai-13 1,677,42 46,967 74 1,88615 5,87033 1,405,432,98
Apr-13 1.677.42 45.39032 1,901,10 5,655.97 1,401,853.56
Muy-13 1,677 42 43,61790 1,916,01 5,841.06 1,399,260 13
)un-13 1,677 42 41,935.48 1,930.99 5,826.08 1,394.651 72
Ja1-13 1,677.42 40,258.06 1,946.01 5,911.05 1,391,02818
Ycar2 Aug•13 1,677.42 38380,64 1,96112 5,795.95 1,367,389.74
Sep-13 1,6677,42 36.903.22 1,97628 5,780.79 1,183,736 01111
Oct-13 1,677.42 35,22580 1,991.50 5,765-57 1,380,067.12
Nov-13 1,677.82 33,548 38 2,006.79 5,750.28 1,376,392.91
Dec-13 1,677.42 31,870.96 2,022.14 5,734.93 1,372,68335
Jun-14 1,677 42 30,193 54 2,037.56 5,719.31 1,368.96837
Feb•IA 1.677 42 28,516.12 2,053.04 5,704.03 1.365.237.91
Mar-14 1.67742 26,838.70 2,06858 5,688.49 1,361,191.91
Apr-14 1,677.42 25,161.28 2,084.19 5,672.88 1,357,730.30
May-14 1,677 42 23,483 86 2,099,86 5,657.21 1,353,9.53,02
Jun-14 1,677.42 21,806.44 2,115.60 5,641,47 1350360.00
Jul•14 1,677.42 20,129.02 2,131,40 5,625.67 1346,35118
Yea.;3 Aug.14 1,677.42 18,451 60 2,147.27 5,609,80 1,342,52649
Sep-14 1,677.42 16,774,18 2,163.21 5,593.86 1,338,683.86
0e1-14 1,677.42 15,096 76 2,179.21 5,577.86 1,334,829.23
Nov-I4 1,677.42 13,419,34 2,195.28 5,561 79 1,330,956.53
Dec.-14 1,677.42 11,741.92 2,211 42 5,545.65 1,327,067.69
Jan-15 1,677.42 10,064.50 2,227,62 5,529,45 1.323,162 65
Feb-IS 1,677.42 8,38708 2,243.89 5,513.18 1,319,241.34
Mar-15 1.67742 6,709.66 2260.23 5,49684 1,315,103.69
Apr-15 1,67742 5,032 24 2,276.64 5,460.43 1,311.349.6.3
May-15 1,677,42 3,354,92 2,993.11 5,46396 1,307,379,10
Jun-15 1,677.42 1.677.40 2,309.66 5,447.41 1,303,392.02 111
Jul-15 L677.40 000 2,326.27 5,430,80 1,299,388.35
Year 4 Aug-15 2,342.95 5,414,12 1,297,045.40
Sep-I5 2,35271 1,677.32 5.44436 1,293,015,37
Oct-15 2,36951 1,677.32 5,387,56 1288,968.54
Nov-15 2,386,37 1,677.32 5,370,70 1,284,904.85
Dec-IS 2,403.30 - 5,353.77 1,282,591.55
Jan-16 —
2,413.31 5,343.76 1,260,068.24
Feb 16 2,423 37 - 5,333.70 1,277,664.87
Mar-36 2A33.47 - 5,32160 1,275,231 40
Apr-16 2,443,61 . 5,313.46 1272,787,79
May-16 2,453.79 - 5,303.28 1,270,334.00
Jun-16 2,464 01 - 5193.06 1267,869.99
Jul-16 2,474.28 - 5,282.79 1.65,395,71
Year S Aug-15 2,484.59 5,272.48 1,262.911.12
Sep-16 2,494,94 . 5,262 13 1,260,416.18
Oct-16 2,505,34 - 5,251.73 1157,910.84
Nov-16 2,515,77 5,241.30 1,253,395.07
Dec-16 2326 26 - 5,230.81 1,252,868.8;
Jan-17 2,536 78 - 5.220,29 1,250,332.03
Feb-17 2,547.35 - 5,209.72 1247.784.68
Mar-17 2,557.97 . 5,199.10 1,245,226.71
Apr-17 2,568.63 - 5,18844 1,242,659,08
May-17 2.379.33 - 5,177,74 1,340,078,75
Jun-17 3,590.08 5,166.99 1,237,488,67
Jul.17 2,600.87 - 5,156.20 1,234,887,80
Aug-17 2,611 70 - 5,145.37 1,2.32,276.10
Sep-17 2,622.59 - 5,134.48 1.229x653 SI
Oct-17 2,633.51 - 5,123.56 1,227,020.00
1017117 - 1,227,029.00 - -
193133v1 6
Old Public Works Building
Cash Inflows & Outflows
Agreed Upon Purchase Price: $1,475,000
Down Payment $ 30,000.00
Principal Paid from 8-1-12 to 8-27-17 212,723.90
Interest Paid from 8-1-12 to 8-27-17 337,489.33
Final Principal Amount Owed 8-27-17 1,232,276.10
City share of environmental costs ** (19,000.00)
Cash Inflows from Contract For Deed $ 1,793,489.33
** -Total estimated environmental costs to be $64,880.00