1997-64667
HRA RESOLUTION N0.646
RESOLUTION AUTHORIZING EARLY CONSTRUCTION ACTIVITY
FOR PHASE II PROPERTY AND
A $89,626 REDUCTION IN LETTER OF CREDIT,
MERIDIAN CROSSINGS PROJECT
WHEREAS, Meridian Properties Real Estate Development LLC (Meridian) is the
developer under the Contract for Private Development with the HRA dated November 6,
1995 and subsequently amended; and
WHEREAS, pursuant to the Third Amendment to the Contract for Private
Development dated April 21, 1997 and the Right of Entry Agreement dated February
18, 1997, Meridian provided the HRA with two letters of credit in the aggregate amount
of $600,000; and
WHEREAS, on or about July 30, 1997, Meridian extended one Letter of Credit
(in the face amount of $495,293) to November 30, 1997 and further has authorized the
HRA to withhold $105,000 of the funds due Meridia,~ as additional security; and
WHEREAS, on September 15, 1997, the HRA authorized release of the
$105,000 due Meridian as additional security based on construction activity progress;
and
WHEREAS, on or about October 13, 1997, Meridian requested that footings and
foundation work commence on the Phase II property prior to a land sale closing and
conditioned upon the HRA continuing to retain proper performance and payment
security for any and all lienable work to be performed on Phase II property prior to a
land sale closing; and
WHEREAS, Meridian acknowledges that the Letter of Credit now on file with the
HRA exceeds the revised list of costs that could be potential liens against the Phase II
property; and
WHEREAS, Meridian requests that the Letter of Credit be reduced by $89,626 to
properly reflect the amount of performance and payment security necessary to
undertake pre-closing construction activity limited footings and foundation work, and
remaining curb, gutter, and paving work.
NOW, THEREFORE, BE IT RESOLVED by the HRA as follows:
1. The Letter of Credit in the face amount of $495,293 with an expiration date of
November 30, 1997 is hereby reduced by $89,626 for a new face amount of
$405,667 and is accepted as full and adequate security for the obligations described
in the Third Amendment and the Right of Entry Agreement, and for the additional
footings and foundation work on Phase II property and are available for use by the
HRA in the same manner as the security described therein.
HRA Resolution No. 646 -2-
2. Meridian shall continue to extend the Letter of Credit beyond the current expiration
date until relieved of the obligations by proper action of the HRA or until a closing on
the Phase II land sale is completed.
3. The Executive Director is authorized to enter into an agreement with Meridian in
order to effectuate the limited, pre-closing construction activity for Phase II.
Adopted by the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota this 20th day of October 1997.
Thomas E. Harms, Chair
ATTEST:
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Michael Sandahl, Secretary
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