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HomeMy WebLinkAboutA Work Session info I �+ DATE: September 6, 2006 REPORT TO: Honorable Mayor and City Commission FROM: Stockyard, LLC 600 N. Wallace, #3 Bozeman, MT 59715 SUBJECT: Future sale of Tract 12 of the Northeast Annexation, City of Bozeman, MT. for the purposes of creating a mobile home park. MISSION STATEMENT: The purpose of this solicitation is to provide an interim solution to the current crisis of affordable housing in the City of Bozeman. Our intent is to develop a mobile home park to provide a much needed supply of entry level housing stock. The mobile home park as an option for people within the City of Bozeman is at risk of disappearing. Our mission is to provide for this community need. Public benefit exists within this proposal. First,this proposal adds a much needed component to a larger effort to address affordability within our community. Secondly, the purchase of the underutilized"lower yard" at current market value would be a positive step towards any number of worthy and needed improvements to the City of Bozeman facilities. This solicitation is accompanied by supporting documents and the required agreements to make this idea a reality. Please find the copies of the real estate option agreement and this abstract, in addition to our letter agreement with our development partner to the east. If the foregoing is acceptable to you, kindly execute a copy of this proposal in the place set forth in the Option agreement and return it. Very truly yours, STOCKYARD, LLC By: rian Caldwell Its: Co-Manager REAL PROPERTY OPTION AGREEMENT This option agreement ("Agreement") is entered into this date by and between City of Bozeman ("Optionor") of P.O.BOX 1230 Bozeman, Montana, 59771, and Stockyard, LLC, a Montana Limited Liability Company, of 600 N. Wallace, Bozeman, Montana, 59715 and/or assigns ("Optionee"). Section 1. _Description of Real Property_. The real property is situated in Bozeman,Montana,and is described on Addendum A which is attached hereto and incorporated herein by reference ("Property"). Section 2. Grant of Option and Term. Optionor grants to Optionee the exclusive right and option to purchase the Property. The Option shall terminate Ninety(90)days after Optionee receives preliminary plat approval for the property. ("Expiration Date"). If Optionee gives notice before the end of the Ninety(90) days of its intent to purchase, then Optionee shall have an additional Thirty (30)days to close,if closing does not occur before. If the Option is not exercised within said period, it shall automatically terminate without any further action by Optionor and without any notice to Optionee or any other person, and all rights of Optionee arising out of this Agreement shall immediately cease. Optionee has the right to terminate Option at Optionee's sole discretion during the term of the Option. Section 3. Consideration. Upon execution of this Agreement, Optionee agrees to pay to Optionor the sum of One Hundred Dollars ($100.00.) Section 4. Purchase Price and Payment. If Optionee exercises this Option in the manner described in this Agreement,the amount payable("Purchase Price")shall due and payable at Closing and Purchase Price shall be determined by an appraisal of the land to take place within 60 days of the execution of this agreement. The appraisal will be completed by an appraiser agreed upon by both parties. If the parties cannot agree upon an appraiser,each party will select an appraiser within three (3)days of their failure to select a mutual appraiser. Within five(5)days the two selected appraisers will meet and select a third appraiser. The third appraiser will complete the appraisal. The purchase price will be the appraised value of the land. Section 5. Manner of Exercise. This Option shall be exercised ("Notice of Exercise") by Optionee giving written notice to Optionor by either tendering such written notice in person to Optionor or by sending such written notice to Optionor,certified mail,postage prepaid,which notice shall be effective at the time it is placed in the United States mails. The date upon which such written notice is tendered in person or the date when such notice is mailed as provided herein shall be the exercise date. The notice shall designate a date for Closing which shall be no more than sixty days from the date of the notice of exercise,unless a reasonable extension is necessary for financing purposes. Section 6. Conveyance and Optionor's Title. Optionor shall convey the property at Closing to Optionee by statutory warranty deed, free and clear of all liens and encumbrances except zoning ordinances,any existing covenants,a 20 year deed restriction ensuring that the property will remain a mobile home park for those 20 years, reservations and federal patents, utility easements of record Page 1 - REAL PROPERTY OPTION AGREEMENT with no other exceptions. Optionor shall furnish to Optionee a standard owner's title insurance policy in the amount of the purchase price, from a title insurance company selected by Optionee, showing good and marketable title subject only to the exceptions above stated. Optionee may elect to purchase an ALTA owner's policy with additional endorsements. Any additional expense above and beyond the premium for a standard owner's policy shall be borne by Optionee. At least twenty days after delivery of the Notice of Exercise, Optionor shall furnish to Optionee a preliminary title report showing the condition of title to the Property. Optionee shall have twenty days after receipt of the preliminary title report and exceptions within which to notify Optionor,in writing,of Optionee's disapproval of any exceptions shown in the report,other than exceptions for current taxes not yet due and payable,zoning ordinances,building and use restrictions,reservations, and federal patents and utility easements of record. Section 7. Optionor's Warranty_. Optionor warrants that,as of the Closing date,there will be no trespassers in position of any portion of the Property,there will be no leases affecting the Property, and there will be no unrecorded liens affecting the Property created through the Optionor's voluntary act. Section 8. Closing. Closing shall occur at the offices of American Land and "Title Company ("Escrow Agent"). Closing shall take place in the manner set forth in this Agreement, and the Escrow Agent shall prorate as of the Closing date,rents and other normal prorations on a fiscal year basis. Optionor shall pay all delinquent property taxes from the proceeds at closing. Optionee shall. pay the costs of the closing agent. Section 9. Remedies. The parties shall be entitled to such remedies for breach of contract as may be available under applicable law including, without limitation, the remedy of specific performance. Section 10. Assignment. This Option Agreement shall be binding upon and inure to the benefit of the parties hereto, and their respective heirs, personal representatives, successors and assigns. Optionee shall have the right to assign any interest hereunder without the prior written consent of Optionor to an entity owned in whole or part by Optionee ("Affiliate Entity"). In the event that Optionee assigns Optionee's interest to a party other than Affiliate Entity,then Optionee must receive prior written approval from Optionor, which approval cannot be unreasonably withheld. Section 11. Time. Time is of the essence of this Agreement. Section 12. Testing. After the execution of this Agreement, Optionee may conduct testing upon the property,including evasive testing,but Optionee shall restore the property to the same condition it was in prior to testing. Optionee shall hold Optionor harmless from any property damage or personal injury that may occur upon the property by reason of acts by Optionee, its agents, or employees. Page 2 - REAL PROPERTY OPTION AGREEMENT IN WITNESS WHEREOF,the parties have executed this Agreement on this day of , 2006. Optioner: City of Bozeman By: Its: Optionee: Stockyard, LLC By: Brian Caldwell Its: Co-Manager By: Eric Nelson Its: Co-Manager Page 3 - REAL PROPERTY OPTION AGREEMENT ` Addendum A Description of Real Property. The real property is situated in Bozeman, Montana, and is described as follows: All that part of the northwest Quarter of the northeast Quarter of Section Six (6) ,Township Two (2) South of Range Six (6) East of the Montana Principal Meridian, containing eight(8) acres, more or less, exclusive of public roads and highways, included within the following described metes and bounds; beginning at a point 859.7 feet South and 30 feet East of the Quarter section corner on the north line of section Six (6) and running these North, parallel with and 30 feet East of the North and South quarter line in the said Section Six (6), 384.7 feet; thence East 70 feet; thence North 200 feet; thence West 32 feet to a point on the East boundary of the highway; thence along a right curve with a radius of 818.8 feet for a distance of 270 feet more or less to intersect with the south boundary of the east and west county road; thence South 89 degrees 45 minutes East 322.5 feet to a point 30 South of the section line and approximately 900 feet East of the above mentioned North and south quarter line; thence south parallel with the said quarter line 809.8 feet; thence South 88 degrees 42 minutes West 467.5 feet more or less to the point of beginning, except rights-of-way heretofore granted over and across said land. The real property is illustrated in image 1 below as a reference to the surrounding area: \' �a. ill"II'.� Tract 12 City of B (aprox 8 ea w Image 1 LETTER OF INTENT Stockyard, LLC 600 N. Wallace, #� Bozeman, MT 59715 September 5th, 2006 Greg Poncelet 209 Cedar Street Bozeman, MT 59715 Re: Future Development of Tract 12 and Tract 15 of the Northeast Annexation, City of Bozeman, MT. Dear Mr. Poncelet: In the last few weeks we have discussed your interest in entering into a possible partnership agreement for the development of a mobile home park on Tract 12 and Tract 15 of the Northeast Annexation. At this time Stockyard, LLC is attempting to secure the purchase of Tract 12 from the City of Bozeman. You currently own Tract 15. The purpose of this Letter of Intent is to memorialize our discussions and place in writing that Stockyard, LLC intends to work with you, and you intend to work with. Stockyard, LLC to create a mobile home park. You desire to work with Stockyard, LLC, as opposed to another buyer of Tract 12. Once Stockyard, LLC receives preliminary plat approval for Tract 12, and purchases the property, Stockyard, LLC and yourself will enter into some form of partnership, the details to be discussed and agreed to in the future. The parties agree to use their best efforts to enter into some form of mutually agreed upon, equitable partnership no later than Fifteen(15) days after Stockyard, LLC purchases the property. If the parties should fail to enter into a partnership agreement in Fifteen days, this Letter of Intent will be null and void. We agree that Letter is Intent may not be transferred or assigned, in whole or in part, without the written consent of the parties. 1f the foregoing is acceptable to you, kindly execute a copy of this letter in the place set forth below and return it.