1 Old Village Hall PA Amendment
CITY OF
CHANHASSEN
7700 MarKet Boulevard
PO Box 147
Chanl'ass811 MI~ 55317
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Fax 952227.1110
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MEMORANDUM
TO:
Todd Gerhardt, Executive Director
FROM:
Justin Miller, Assistant to the Executive Director.r
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DATE:
October 1,2004
RE:
First Amendment to Purchase Agreement with Fred and Valaire
Riese for Lot 1, Block 1, Old Village Hall
BACKGROUND
On August 23rd the Economic Development Authority approved a purchase
agreement with Fred and Valaire Riese for Lot 1, Block 1, Old Village Hall.
Since this time, staff has been working with the Riese's and a site plan is
scheduled to be presented to the Planning Commission on October 5th and to the
City Council on October 11 tho
The buyer has a very tight timeframe on this project, and would like to begin
construction before the end of the year. The buyers are using two types of
financing for the project - personal equity and traditional lending. The personal
equity must be spent by October 27th in order to avoid certain tax consequences.
While their traditional financing (a Small Business Administration loan) has been
approved, it will not be available until after the October 27th deadline. The
Riese's have asked that the City help bridge this gap, and partially close on the
property by October 27th and issue a contract for deed until the remainder of their
financing is available.
Staff has discussed this issue with legal counsel and we are comfortable with this
approach. In essence, title will remain in the ED A's control until the total
purchase price has been paid, but this will allow the buyer to continue the process
without losing personal equity. This action does require an amendment to the
purchase agreement, which is attached to this report. The amendment gives the
buyers one month after the closing date (scheduled for October 27th) to produce
the remaining funds.
RECOMMEND A TION (reQuires a maioritv vote of the EDA)
Staff recommends the Economic Development Authority approve the attached
first amendment to the purchase agreement between the ED A and Fred and
Valaire Riese.
The City of Chanhassen · A. growing COnlnlUlllty Wlttl clear: lakes. quality schcols a
and beautltul parks A great place to ilve. work, and piay
FIRST AMENDMENT TO REAL EST A TE PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO REAL ESTATE PURCHASE AGREEMENT (this
"Amendment") is made and entered into this
day of
, 2004, by and between FREDERICK C. RIESE and V ALAIRE RIESE ("Buyer")
and ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF
CHANHASSEN, a public body corporate and politic under the laws of the State of Minnesota
("Seller").
RECIT ALS
On August 24, 2004, Buyer and Seller entered into a Real Estate Purchase Agreement
(the "Purchase Agreement") for the purchase and sale of property to be platted as Lot 1,
Block 1, Old Village Hall, in the City of Chanhassen, Minnesota. At Buyer's request,
Seller has agreed to defer payment of a portion of the Purchase Price in the manner set
forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein,
Seller and Buyer mutually agree as follows:
1.) Defined Terms - Unless otherwise defined herein, each capitalized term used in
this Amendment shall have the same meaning ascribed to such term in the Purchase Agreement.
2.) Purchase Price - Section 2.1.2 of the Purchase Agreement is hereby deleted in its
entirety and replaced with the following provision:
"One Hundred Thirty-eight Thousand Five Hundred Dollars ($138,500.00) cash on the
"Closing Date" (as defined below), subject to the adjustment set forth in Section 2.1.3
below. The balance of the Purchase Price in the approximate amount of Four Hundred
Fifty Thousand and no/lOO Dollars ($450,000.00) (the "Deferred Purchase Price") by
Seller and Buyer executing and performing the terms and conditions of a contract for
deed for the Property using Minnesota Uniform Conveyancing Blank Form 56-M. The
Deferred Purchase Price shall be due and payable in full within one (1) month after the
Closing Date and shall not bear interest. Seller shall deliver a limited warranty deed as
required by Section 4.3.1 and shall pay the state deed tax as required by Section 4.5.1
when Buyer pays the Deferred Purchase Price in full."
3.) Ratification - Except as specifically modified by this Amendment, Seller and
Buyer hereby ratify and affirm the Purchase Agreement.
IN WITNESS WHEREOF, Seller and Buyer have executed this First Amendment to Real
Estate Purchase Agreement as of the day and year first above written.
BUYER:
Frederick C. Riese
Valaire Riese
SELLER:
ECONOMIC DEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF CHANHASSEN
By:
Its: Executive Director
By:
Its: Chairman
967817.1
2.