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7. Center Street Plaza Development AgreementLOAN AND DEVELOPMENT AGREEMENT This Loan and Development Agreement, made this day of , 1998, by and between CMA, L.L.P., a Montana limited liability partnership, hereinafter PARTNERSHIP and the CITY OF KALISPELL, a municipal corporation, hereinafter CITY: W I T N E S S E T H: WHEREAS, the City of Kalispell, pursuant to Title 7, Chapter 15, Parts 42 and 43, Montana Code Annotated, has enacted the Kalispell Downtown Redevelopment Plan, Ordinance #933 on the 10' day of September, 1979, and WHEREAS, as part of the Kalispell Downtown Redevelopment Plan the City Council of the City of Kalispell determined that the "project area" was blighted and that extensive rehabilitation was necessary within the "project area" to facilitate proper development within the area, and WHEREAS, under Title 7, Chapter 15, Part 42 and 43 MCA, and the Kalispell Downtown Redevelopment Plan, the City is authorized to eliminate and prevent the spread of blight by encouraging the redevelopment of land by private enterprise, and WHEREAS, PARTNERSHIP has made a request to utilize funds available to the City under the Kalispell Downtown Redevelopment Plan to improve infrastructure and make certain on -site improvements to property located on Lots One, Two and Three, Block 31, Kalispell Original Townsite, and WHEREAS, the assistance requested and granted pursuant to this Agreement shall consist of a grant in the amount of Sixteen Thousand One Hundred Sixty-six Dollars ($16,166.00) and a loan in the amount of Seventy Thousand Five Hundred Twenty-nine Dollars ($70,529.00), and WHEREAS, PARTNERSHIP'S proposal has been reviewed by the Community Development Department and the City Council. NOW, THEREFORE, in consideration of the premises and mutual covenants hereinafter contained, the parties hereto agree as follows: I:\wp\centerstreetplaza.wpd 1 I. LOAN AGREEMENT SECTION 1.1. Amount and Source of Loan The City does hereby agree to lend to the Partnership, a principal amount of Seventy Thousand Five Hundred Twenty-nine Dollars ($70,529.00) in accordance with and subject to the terms and conditions stated herein, and the Partnership shall execute to the City a Note evidencing said obligation, a copy of the form of such Note is attached hereto as Exhibit "A" and by this reference incorporated herein. Contemporaneously with the execution of said Promissory Note the parties shall execute a Mortgage whereby the interest of the Partnership in said property and its improvements shall be Mortgaged to the City to secure the Promissory Note set forth in Exhibit "A". A copy of the form of said Mortgage which the Partnership shall execute is attached hereto as Exhibit "B" and by this reference made a part hereof. SECTION 1.2. Repayment of Loan The Partnership agrees to pay as loan repayments on each payment date an amount equal to the interest and principal, payable on the note on said payment date. In any event, the loan repayments shall at all times be sufficient to pay all principal of and interest on the note as such principal and interest become due, at maturity, upon prepayment, acceleration or otherwise. The obligation of the Partnership to repay the loan hereunder shall commence as of the date of the note. All loan repayments shall be applied first to interest due on the outstanding principal balance of the loan and thereafter in reduction of said principal balance. Each payment by the Partnership under this Section shall be made directly to the City at its principal office, City of Kalispell, 312 First Avenue East, Kalispell, Montana. In the event the Partnership should fail to make any of the payments required under this Section, the item showing default shall continue as an obligation of the Partnership until the amount in default shall have been paid in full, and shall bear interest to the extent permitted by law at the rate then borne by the note. SECTION 1.3. Purpose of Loan The parties hereto agree that the purpose of said loan to the Partnership is to enable the Partnership, and said Partnership hereby agrees, to improve, pave and landscape Lots One, Two and Three, Block 31, Kalispell Original Townsite, to provide for a I:\wp\centerstreetplaza.wpd 2 parking lot to be used by the Partnership and the tenants occupying the building commonly known and referred to as the Center Street Plaza at a minimum expenditure of Seventy Thousand Five Hundred Twenty-nine Dollars ($70,529.00). SECTION 1.4. Loan Documents — Applicability Term of loan, interest, repayment schedule and security shall be as set forth in the Note and Mortgage, Exhibits A and B respectively. SECTION 1.5. Loan Proceeds The parties agree that the Loan Proceeds of Seventy Thousand Five Hundred Twenty-nine Dollars ($70,529.00) shall be solely used for the purpose of partially funding the construction of a parking lot and other amenities by the Partnership on Lots 1, 2 and 3, Block 31, Kalispell Original Townsite. The City shall disburse to the Partnership the Loan Proceeds immediately upon the Partnership executing simultaneously this Agreement, the Note and the Mortgage. SECTION 1.6. Disbursement of Proceeds. The City upon the execution of this Loan Agreement, the Note, and the Mortgage by the Partnership agrees to disburse the entire amount of the Loan proceeds or the amount of Seventy Thousand Five Hundred Twenty-nine Dollars ($70,529.00) for the use of the Partnership pursuant to the terms of this agreement. SECTION 1.7. Covenant of Partnership to Construct The Partnership covenants and agrees to construct on Lots 1, 2 and 3, Block 31, Kalispell Original Townsite, a parking lot and other amenities for use by the partnership and their tenants in the Center Street Plaza and to complete said construction on or before the 15t' day of September, 1999. The Partnership represents that the construction of the parking lot is necessary to fully utilize and to comply with Chapter 27, Section 26, Kalispell Zoning Ordinance. The Partnership further covenants and agrees that the Partnership shall comply with all laws and ordinances of the City of Kalispell concerning the construction of parking facilities and will use its best efforts to complete construction in a timely manner. SECTION 1.8. Event of Default Any one or more of the following events is an Event of Default under this agreement: I:\wp\centerstreetplaza.wpd 3 a) If the Partnership shall fail to make any Loan Repayment required under Section 1.6. on the date that the payment is due. b) If the Partnership shall fail to observe or perform in any material respect any other covenant, condition or agreement on its part under this Agreement. c) If the Partnership shall file a petition in bankruptcy or reorganization or for an arrangement pursuant to any present or future federal bankruptcy act or under any similar federal or state law or shall be adjudicated as bankrupt or insolvent; shall make an assignment for the benefit of its creditors or shall admit in writing its inability to pay its debts generally as they become due, or if a petition or answer proposing the adjudication of the Partnership as a bankrupt or its reorganization under any present or future federal bankruptcy act or any similar federal or state law shall be filed in any court and such action or answer shall not be discharged or denied within sixty (60) days after the filing thereof, or a receiver, trustee or liquidator of the Partnership or of all or substantially all of the assets of the Partnership shall be appointed in any proceeding brought against the Partnership and shall not be discharged within sixty (60) days or if the Partnership shall consent to or acquiesce in the appointment or if its estate or interest of the Partnership in the parking lot or any part thereof shall be levied upon or attached in any proceeding and such process shall not be vacated or discharged within thirty (30) days after such levy or attachment, or the Partnership shall be dissolved or liquidated. d) If any representation or warranty made by the Partnership herein, or in Mortgage, or by the Partnership in any document or certificate furnished the City in connection herewith or therewith or pursuant hereto or thereto, shall prove to be incorrect or misleading in any material respect as of the date made. e) If the Partnership shall default under any of the covenants, conditions or agreements on its part under the Note, Mortgage, or this Agreement and the time for cure of such default, pursuant thereto, if any, shall have expired, and such default shall not have been waived. I:\wp\centerstreetplaza.wpd 4 SECTION 1.9. City's Remedies in Default Whenever any Event of Default will have happened any one or more of the following remedial steps may be taken by the city: a) The City may at its option declare all Loan Repayments payable under the Note for the remainder of the Term (being an amount equal to that necessary to pay the Note in full, assuming acceleration of the Note, and to pay all other indebtedness thereunder) to be immediately due and payable, whereupon the same shall become immediately due and payable by the Partnership and interest shall accrue thereon to the date of payment. b) The City, with or without declaring all such Loan Repayments immediately due and payable, may take whatever action at law or in equity be necessary or appropriate to collect the Loan Repayments immediately due and payable, may take whatever action that law or equity be necessary or appropriate to collect the Loan Repayments then due and thereafter to become due or to enforce performance and observance of any obligation, agreement or covenant of the Partnership under this Agreement or under any of the Collateral Documents. c) Notwithstanding any other provision of this Loan Agreement, the Note, or the Mortgage, the Partnership shall have a period of thirty (30) days after written notice of an Event Default within which to cure the default. If the Default is cured during the thirty (30) day period, the Note and this Loan Agreement shall be reinstated without acceleration. SECTION 1.10. Disposition of Funds Any amount realized pursuant to action taken under Section 1.12 hereof shall be applied as follows: a) First, to the payment of all costs and expenses (including reasonable attorney's fees as permitted by law), liabilities incurred or advances made hereunder by the City. b) Second, to the payment to the City of the amount then owing or unpaid under this agreement for principal or interest due on the loan, and in case any such proceeds shall be insufficient to pay the whole amounts so due, I:\wp\centerstreetplaza.wpd 5 then first to the payment of interest and then to the payment of principal, and c) Third, to the payment of any excess to the Partnership, or to whomever may be lawfully entitled to receive the same. SECTION 1.11. Right of Prepayment The Partnership throughout the period of this Loan Agreement shall have the full right of prepayment, at any time, without penalty. II. DEVELOPMENT AGREEMENT Definitions In this Agreement, unless a different meaning clearly appears from the context: "Act" means Montana Code Annotated Title 7, Chapter 15, Parts 42 and 43, as amended. "Agreement" means this Agreement, as the same may be from time to time modified, amended or supplemented. "Assessed Valuation" means the value of real property as determined by the Department of Revenue in accordance with Montana Code Annotated against which real property tax is imposed. "City" means the City of Kalispell, Montana and for purposes of administering this agreement shall also mean the City Manager. "Construction Plans" means the plans, specifications, drawings, and related documents for the construction work to be performed by the DEVELOPER on the Project Property, which (a) shall be at least as detailed as the plans, specifications, drawings and related documents which are submitted to the building official of the CITY and (b) shall include at least the following: (1) site plans; (2) foundation plans; (3) basement plans; (4) elevations on all sides; (5) landscaping plan; (6) grading plan; and (7) utility plan. "Developer" means CMA, L.L.P. "Project" means the Project described in Section 2.2. I:\wp\centerstreetplaza.wpd 6 "Project Area" means that tract of land described as Lots One, Two and Three, Block 31, Kalispell Original Townsite. "Redevelopment Area" means those areas of Kalispell which have been designated by CITY as blighted and therefore desirable for rehabilitation. "Redevelopment Plan" means the CITY'S overall plan for promoting rehabilitation of City areas found to be blighted. "Section" means a Section of this Agreement, unless used in reference to Montana Code Annotated. "Site Plans" means the plans to be submitted by the DEVELOPER showing the Project Area and the Project which will include all on - site improvements, off -site improvements, and the infrastructure improvements. "State" means the State of Montana. "Tax Increment" means that portion of the real estate taxes paid with respect to the Redevelopment Property which is remitted to the CITY as tax increment pursuant to the Tax Increment Financing provisions of the Montana Urban Renewal Law. "Tax Increment Financing Plan" means the Tax Increment Financing Plan for Tax Increment Financing by the City Council. "Unavoidable Delay" means a failure or delay in a party' s performance of its obligations under this Agreement, or during any cure period specified in this Agreement which does not entail the mere payment of money, not within the party's reasonable control, including but not limited to acts of God, governmental agencies, the other party, strikes, labor disputes, fire or other casualty, or lack of materials, provided that within 10 days after a party impaired by the delay has knowledge of the delay it shall give the other party notice of the delay and the estimated length of delay, and shall give the other party notice of the actual delay within 10 days after the cause of the delay has ceased to exist. The parties shall pursue with reasonable diligence the avoidance and removal of any such delay. Unavoidable delay shall not extend performance of any obligation unless the notices required in this definition are given as herein required. I:\wp\centerstreetplaza.wpd 7 Representations and Warranties SECTION 2.1. By CITY. CITY makes the following representations to DEVELOPER: (a) The CITY, under the Act and Ordinance No. 933 and Ordinance No. 1243, has the power and authority to enter into this Agreement and carry out the obligations hereunder. (b) The Project is an "urban renewal project" within the meaning of the Act and has been approved by the City Council in accordance with the terms of the Act, Ordinance No 933 and Ordinance No. 1243. (c) The Urban Renewal Plan, as approved by Ordinance No. 933 and Ordinance No. 1243, contains a provision for tax increment financing for the Redevelopment Area and the incremental increase in taxes based on the value of ad valorem property within the area after the base year shall be collected, segregated by the County Treasurer, and transferred to the City for the benefit of the Redevelopment Area. (d) The City has on hand, in its Tax Increment Fund or has the authority to borrow, at least sufficient funds to complete it obligations under this Agreement. (e) The City has determined that the infrastructure improvements described in Section 2.2(h) are necessary to the development of the Project, at a cost of Sixteen Thousand One Hundred Sixty-six Dollars ($16,166.00). (f) The cost of designing, engineering, acquiring, and constructing said infrastructure are cost that can be financed through tax increments pursuant to Section 7-15- 4288, of the Act, and the City Council has authorized the use of the tax increment to finance those improvements, subject to Section 2.3. SECTION 2.2. By DEVELOPER. DEVELOPER represents and warrants that: (a) DEVELOPER, CMA, L.L.P. is a limited liability partnership, duly organized under the laws of the State I:\wp\centerstreetplaza.wpd 8 of Montana, has the power to enter into this Agreement, and has duly authorized the execution, delivery and performance of this Agreement. (b) DEVELOPER will, subject to unavoidable delays, construct, operate and maintain on the Project Property a retail and commercial development described in the Site Plans, together with all related on -site improvements, including, but not limited to, off-street parking, landscaping, on -site utilities and any off -site infrastructure improvements necessary to properly serve the Project Area (the Project). The parties agree that notwithstanding the Site Plans, the Project is in the formative stages and may change in both timing and occupancy during the development process; however, any and all changes shall be subject to approval by the CITY. (c) DEVELOPER estimates the Project as described the following estimates: Description of Protect Land Acquisition Site Improvements Building Construction Contingency that the cost of constructing in (b) is $ 620,692.00 based on Estimated Cost $ 220,000.00 $ 86,695.00 $ 285,452.00 $ 28,545.00 TOTAL $ 620,692.00 (d) DEVELOPER estimates, based upon information available to it and the projected cost of constructing the Project, that the Assessed Valuation of the improved real property constituting the Project, inclusive of furniture, fixtures, equipment, and other taxable personal property will be at least $ 620,692.00. The parties understand that the actual Assessed Valuation of the DEVELOPER'S portion of the Project as determined by the Montana Department of Revenue may be greater or lesser than the estimate. (e) DEVELOPER has obtained, or has available to it, sufficient funding to complete the construction of the Project. I:\wp\centerstreetplaza.wpd 9 (f) DEVELOPER has been advised that the Redevelopment Area is subject to building and use restrictions imposed pursuant to the Kalispell Zoning Ordinance, including, but not limited to, prohibitions on the display of billboards and/or off -premises signs. (g) Developer is aware on the Infrastructure Improve- ments which are the responsibility of the City described in Section 2.2(h) and the on site improvements associated wit this Agreement and represents and acknowledges that the construction of such improvements are necessary to the development of the Project. (h) Developer has requested that the City pay the costs of designing, acquiring and installing the following infrastructure improvements: sidewalk on 4tn Avenue West, sidewalk on Center Street, paving of alley, one (1) light pole and landscaping; all within City rights -of -way. Infrastructure Improvements SECTION 2.3. Seauencina of Events. a) The City, after coordinating with the Developer, shall proceed with the design and/or construction of the Infrastructure Improvements utilizing City personnel and/or contract services. The City will complete the design of the Infrastructure Improvements and commence competitive bidding, if required, upon signing of this Agreement, provided that the City is not prevented from proceeding by court order or delay occasioned by a referendum petition. Upon completion of the bidding process, a final construction budget and time table for the Infrastructure Improvement will be prepared by the City and then be reviewed by and subject to the approval of the Developer. Infrastructure Improvements shall be installed on or before lst day of June, 1999, when Developer plans on opening its complex for business. b) Developer may, at its option, proceed with the design and/or construction of the Infrastructure Improvements, listed in 2.2 (h), upon review by the City. In that event, Developer shall submit proof of payment for work accomplished and the City shall reimburse Developer on I:\wp\centerstreetplaza.wpd 10 the invoices. Application of this paragraph shall waive the time requirements set forth in 2.3. (a). SECTION 2.4. Limitations on City's Commitment. The City shall use its tax increment revenues to pay for the cost of only those infrastructure improvements listed in Section. 2.2 (h). In the event other public infrastructure improvements other than those listed in Section 2.2. (h) are required, said improvements shall be the responsibility of the Developer. Construction of Project SECTION 2.5. Site Plans and Construction Plans. DEVELOPER shall submit Site Plans and Construction Plans to the CITY prior to obtaining any building permits. Site Plans shall depict the entire Project Area and shall show the location of the Project, the Infrastructure Improvements and other items required by this Agreement to be shown therein. The Construction Plans shall provide for the construction of the Project in conformity with the Redevelopment Plan, the Site Plans, this Agreement, and all applicable federal, state and local laws and regulations. The CITY shall approve the Construction Plans in writing if, in the reasonable discretion of the CITY, the Construction Plans: (a) substantially conform to the Plans and subsequent amendments approved by the CITY; (b) conform to the terms and conditions of this Agreement; (c) conform to the terms and conditions of the Redevelopment Plan; (d) conform to all applicable federal, state and local laws, ordinances, rules and regulations; (e) are adequate to provide for construction of the Project; and ( f ) no Event of Default has occurred. SECTION 2.6. Construction of the Protect. (a) Subject to unavoidable delays, DEVELOPER will construct the Project without encroachment onto any other property all in accordance with the Site Plans, the Construction Plans. DEVELOPER will be responsible for the supervision of and completion of the on -site improve- ments. Neither party shall exercise any control over the other regarding their respective areas of work and division of responsibilities although the parties agree to coordinate their activities to assure maximum efficiency of the construction process. (b) All work with respect to the Project shall be in substantial conformity with the Construction Plans I:\wp\centerstreetplaza.wpd 11 approved by the CITY. DEVELOPER shall promptly begin and diligently complete all on -site improvements. DEVELOPER shall make reports, in such detail and at such times as may reasonably be requested by the CITY, as to the actual progress of DEVELOPER with respect to construction of the on -site improvements. (c) DEVELOPER shall not interfere with, or construct any improvements over, any public street or utility easement without the prior written consent of the CITY. All connections to public utility lines and facilities shall be subject to approval of the CITY and any private utility company involved. All street and utility instal- lations, relocations, alterations and restorations shall be made at DEVELOPER'S expense. DEVELOPER, at its own expense, shall replace any public facilities or utilities damaged during construction of the Project. Defense of Claims; Developer's Risk SECTION 2.7. Defense of Claims. DEVELOPER shall indemnify and hold harmless the CITY and their respective officers, employees and agents for any loss, damages and expenses (including attorney's fees) in connection with any claim or proceeding arising from damages or injuries received or sustained by any person or property by reason of any actions or omissions of DEVELOPER or its contractors, agents officers or employees under this Agreement, other than claims or proceedings arising from any negligent or unlawful acts or omissions of the CITY or their contractors, agents, officers, or employees. Promptly after receipt by the CITY of notice of the commencement of any action in respect of which indemnity may be sought against the DEVELOPER under this Section, the CITY will notify the DEVELOPER in writing of the commencement thereof, and, subject to the provisions hereinafter stated, the DEVELOPER shall assume the defense of such action (including the employment of counsel, who shall be counsel satisfactory to the CITY, and the payment of expenses) insofar as such action shall relate to any alleged liability in respect of which indemnity may be sought against the DEVELOPER. The CITY shall have the right to employ separate counsel in any such action and to participate in the defense thereof, but the fees and expenses of such counsel shall not be at the expense of the DEVELOPER unless the employment of such counsel has been specifically authorized by the DEVELOPER. The omission to notify the DEVELOPER as herein provided will not relieve it from any liability which it may have to any indemnified party pursuant hereto, otherwise than under this section. I:\wp\centerstreetplaza.wpd 12 SECTION 2 8 Developer understands and accepts certain risks associated with proceeding with the Protect The City shall act in good faith and shall use its best efforts to assure completion of the Infrastructure Improvements in accordance with this Agreement. In the event the City is unable to complete the Infrastructure Improvements in a timely manner as a result of legal challenge resulting in a court order preventing City participation in the Project of a declaration of invalidity pursuant to Montana law by initiative or referendum, Developer shall have the right to withdraw from this Agreement or to complete the Infrastructure Improvements at Developer's expense. SECTION 2.9. Payment of Taxes Developer shall pay when due all real estate taxes and installments of special assessments payable on the Project Property. Developer and the City recognize that the State of Montana, Department of Revenue shall utilize calculator or segregated cost methods to determine the Assessed valuation of the improved real property and the Developer shall utilize an income approach to value to protest the Assessed Valuation of said property for a period of five (5) years from the date of this agreement. Events of Default SECTION 2.10. Events of Default. The following shall be "Events of Default" under this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement (unless the context otherwise provides), any one or more of the following events which occurs prior to the issuance of the Certificate of Completion by the CITY of this Agreement with respect to the Project and continues for more than 30 days after notice by the CITY to DEVELOPER of such default (and the term "default" shall mean any event which would with the passage of time or giving of notice, or both, be an "Event of Default" hereunder): (a) Failure of DEVELOPER to construct the Project. (b) Failure of DEVELOPER to furnish the Site Plans or Construction Plans. I:\wp\centerstreetplaza.wpd 13 (c) Failure of DEVELOPER to pay real estate taxes, the payment contemplated in Section 2.9. (d) Any event of default otherwise provided under the Loan Agreement provisions of this Agreement (Section 1.11) or in the Loan Documents or as otherwise provided by local, State or federal law. SECTION 2.11. Remedies on Default. Whenever any Event of Default referred to in Section 2.10. or Section 1.8. occurs, the CITY may take any one or more of the following actions: (a) Suspend its performance under this Agreement until it receives assurance from DEVELOPER, deemed adequate by the CITY, that DEVELOPER will cure its default and continue its performance under this Agreement. (b) Terminate all rights of DEVELOPER under this Agreement. (c) Withhold the Certificate of Completion. (d) Take whatever action at law or in equity may appear necessary or desirable to the CITY to enforce performance and observance of any obligation, agreement, or covenant of the DEVELOPER under this Agreement. III. GENERAL PROVISIONS SECTION 3.1. Manner of Exercise. No remedy herein conferred upon or reserved to the City is intended to be exclusive of any other available remedies, but each and every such remedy shall be accumulative and shall be in addition to every other remedy given under this agreement for now or hereinafter existing at law or in equity or by statute. No delay or admission to exercise any right or power shall be considered to be waived thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. I:\wp\centerstreetplaza.wpd 14 SECTION 3.2. Attorney's Fees and Expenses . In the event of any controversy, claim or dispute arising out or relating to this Loan and Development Agreement, the Note, or the Mortgage, or the method and manner of performance thereof or the breach thereof, the prevailing party shall be entitled in addition to any other relief, a reasonable sum as attorney's fees and litigation expenses. In the event neither party wholly prevails, the party that substantially prevails shall be awarded a reasonable sum as attorney's fees and litigation expenses. In determining what is a reasonable sum for attorney's fees and litigation expenses, the actual amount of the attorney's fees the party is obligated to its attorney or attorneys shall be presumed to be reasonable, which presumption is rebuttable, and actual expenses incurred in the proceedings including all expenses of a party for travel, etc., shall be presumed to be reasonable, which presumption is rebuttable. SECTION 3.3. Effect of Waiver In the event any agreement contained in this agreement should be breached by either party and thereafter be waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder. No waiver, amendment, release or modification of this agreement shall be established by conduct, customer course or dealing, but solely by an instrument in writing duly executed by the City, its successors or assigns. SECTION 3.4. Notices All notices, certificates or other communications hereunder shall be sufficiently given and shall be deemed given when mailed by certified or registered mail, postage prepaid, with proper addresses indicated below. The City and the Partnership may by written notice given by each to the other, designate any other address or addresses to which notices, certificates or other communications to them shall be sent when required as contemplated by this agreement. Until otherwise provided by the respective parties, all notices, certificates and communications to each of them shall be addressed as follows: To the City: City of Kalispell, Montana City Hall Drawer 1997 Kalispell, Montana 59903 Attention: City Clerk I:\wp\centerstreetplaza.wpd 15 To the Borrower: CMA, L.L.P. P.O. Box 883 Kalispell, Montana 59903-883 SECTION 3.5. Binding Effect This agreement shall inure to the benefit of and shall be binding upon the City and the Partnership and their respective successors and assigns. SECTION 3.6. Entire Agreement. All understandings and agreements previously existing between the parties, if any, are merged into this Agreement including all schedules and exhibits, which alone fully and completely expresses their agreement, and the same is entered into after full investigation, neither party relying on any statement or representations made by the other not embodied herein. This Agreement may not be changed or terminated orally. SECTION 3.7. Severability If any term, condition or provision of this agreement or the application thereof to any person or circumstance shall, to the extent, be held to be invalid or unenforceable, the remainder thereof and the application of such term, provisions and conditions to persons or circumstances other than those as to whom it shall be held valid or enforceable shall not be affected thereby, and this agreement and all the terms, provisions and conditions hereof shall, in all other respects, continue to be effective and to be complied with to the full extent permitted by law. SECTION 3.8. Amendments, Changes and Modifications Except as otherwise provided in this agreement, subsequent to the initial issuance of the note and before the mortgage is satisfied and discharged in accordance with its terms, this agreement may not be effectively amended, changed and modified or altered without prior written consent of the lender. SECTION 3.9. Execution Counterparts This agreement may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute by one and the same instrument. I:\wp\centerstreetplaza.wpd 16 SECTION 3.10. Limitations on City's Liability No agreement or provision contained in this agreement, nor any other agreement, covenant or undertaking by the City contained in any document executed by the City in connection with this agreement shall give rise to a general liability of the municipality or a charge against its general credit or taxing powers, or shall obligate the City financially in anyway except with respect to this agreement and the application of revenues therefrom and the proceeds of the note. No failure of the City to comply with any term, condition, covenant or agreement herein shall subject the City to liability for any claim for damages, costs or other financial pecuniary charge except to the extent that the same can be paid or recovered hereunder, from or under this agreement or the proceeds of the note; and no execution of any claim, demand, cause of action or judgment shall be levied upon or collected from the general credit, general funds or taxing powers of the City. IN WITNESS WHEREOF, THE CITY HAS CAUSED THIS AGREEMENT TO BE EXECUTED IN ITS NAME AND ON ITS BEHALF AND ITS OFFICIAL SEAL TO BE HEREUNTO FIXED AND ATTESTED BY ITS DULY AUTHORIZED OFFICERS, AND THE PARTNERSHIP HAS CAUSED THIS AGREEMENT TO BE EXECUTED IN ITS NAME AND ON ITS BEHALF, ALL AS OF THE DATE FIRST HEREIN ABOVE WRITTEN. ATTEST: City Clerk CITY OF KALISPELL Mayor CMA, L.L.P. By: Its: I:\wp\centerstreetplaza.wpd 17