8.1. SR 03-21-2016 - Laserfiche WebLink

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City of Elk — River Request for Action To Item Number Mayor and City Council 8.1 Agenda Section Meeting Date Prepared by Consent Agenda March 21, 2016 Amanda Othoudt, EDD Item Description Reviewed by Assignment and Assumption of Tax Abatement Cal Portner, City Administrator and First Amendment to Abatement Agreement for Reviewed by Envision 3, LLC dba Sportech, Inc. Action Requested Approve, by motion, the Assignment and Assumption of Tax Abatement and First Amendment to the Abatement Agreement. Background/Discussion On September 14, 2015, the city entered into a tax abatement agreement with Envision Company, LLC, which was assigned by council action to Envision 3, LLC on November 16, 2015, for organizational and tax purposes. Envision 3, LLC assumed ownership of Lots 1 and 2, Block 2, Natures Edge Business Center Second Addition (NEBC-II), and is party to the tax abatement agreement. Sportech recently completed construction of their assembly plant. Envision 3, LLC is under contract to sell the property to Meritex Elk River, LLC. Upon the sale of the property, Sportech will enter into a long-term lease with Meritex. The building will be Sportech's main assembly plant through the duration of the lease. Sportech is responsible for all building maintenance, repairs, property taxes, and insurance. State statute requires the property owner to pay property taxes in the event that the lessee fails to pay. Envision and Sportech have requested the city consent to the transfer of Lots 1 and 2, Block 2, NEBC-II and the project as defined in the abatement agreement to Meritex allowing them to act as landlord. The mortgage allowed the sale-leaseback transaction between Envision 3 and a third party land holding company, and the mortgage was to be released upon Sportech delivering a fully executed lease to the city. An amendment to the abatement agreement was added to address insurance requirements for the project and all other terms and conditions remain unchanged. Financial Impact None Attachments ■ Attorney Letter dated March 16, 2016, requesting Assignment and Assumption of Tax Abatement and Amendment to the Abatement Agreement ■ Assignment and Assumption of Tax Abatement for Envision 3, LLC and Sportech, Inc. ■ Lease Agreement between Meritex Elk River, LLC and Sportech, Inc. ■ First Amendment to the Abatement Agreement ■ Resolution Approving Assignment of Abatement and First Amendment ■ Mortgage and Security Agreement dated September 14, 2015 P a w E A E U s r NaA f RE]