Loading...
HomeMy WebLinkAbout1999 04-26 EDAP Regular Session EDA MEETING City of Brooklyn Center • April 26, 1999 AGENDA 1. Call to Order 2. Roll Call 3. Approval of Agenda and Consent Agenda -The following items are considered to be routine by the Economic Development Authority and will be enacted by one motion. There will be no separate discussion of these items unless a Commissioner so requests, in which event the item will be removed from the consent agenda and considered at the end of Commission Consideration Items. a. Approval of Minutes - Commissioners not present at meetings will be recorded as abstaining from the vote on the minutes. 1. Regular Session - March 22, 1999 4. Commission Consideration Items a. Resolution Authorizing the Economic Development Authority in and for the City of Brooklyn Center to Apply for a Contamination Clean up Grant from the Minnesota Department of Trade and Economic Development -Requested Commission Action: - Motion to adopt resolution. Resolution Authorizing the Submission of a Grant Application to the Metropolitan Council for the Tax Base Revitalization Account -Requested Commission Action: - Motion to adopt resolution. b. Resolution Approving and Authorizing Execution of a Development Agreement for the Joslyn Poleyard Twin Lake Business Park(Real Estate Recycling) -Requested Commission Action: - Motion to adopt resolution. 5. Adjournment i • EDA Agenda Item No. 3a • MINUTES OF THE PROCEEDINGS OF THE ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA REGULAR SESSION MARCH 22, 1999 CITY HALL 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in regular session and was called to order by President Myrna Kragness at 8:03 p.m. 2. ROLL CALL President Myrna Kragness, Commission Members Debra Hilstrom, Kay Lasman, Ed Nelson, and Robert Peppe. Also present: Executive Director Michael J. McCauley, Assistant City Manager/HR Director Jane Chambers, City Attorney Charlie LeFevere, and Recording Secretary Maria Rosenbaum. 3. APPROVAL OF AGENDA AND CONSENT AGENDA A motion by Commissioner Lasman, seconded by Commissioner Hilstrom to approve the agenda and consent agenda. Motion passed unanimously. 3a. APPROVAL OF MINUTES A motion by Commissioner Lasman, seconded by Commissioner Hilstrom to approve the minutes from the regular session on March 8, 1999. Motion passed unanimously. 4. COMMISSION CONSIDERATION ITEMS 4a. RESOLUTION AUTHORIZING EXECUTION OF CERTAIN CLOSING DOCUMENTS RELATIVE TO THE SALE OF HOMES IN BELLVUE LANE ADDITION Executive Director Michael McCauley discussed certain closing documents must be signed by the seller for all closings and in order to facilitate the closings, this resolution would authorize the Executive Director to execute the required closing documents needed. • 03/22/99 -1- DRAFT Mr. McCauley noted that one of the potential buyers did not qualify and the lot will be available to the next person who qualifies to build the home. Commissioner Hilstrom requested to have an update and time lines for the greenway. RESOLUTION NO. 99 -10 Commissioner Nelson introduced the following resolution and moved its adoption: RESOLUTION AUTHORIZING EXECUTION OF CERTAIN CLOSING DOCUMENTS RELATIVE TO THE SALE OF HOMES IN BELLVUE LANE ADDITION The motion for the adoption of the foregoing resolution was duly seconded by Commissioner Hilstrom. Motion passed unanimously. 4b. REPORT ON 69TH AND BROOKLYN BOULEVARD Mr. McCauley reported that the redevelopment agreement automatically terminated at 4:30 p.m. on March 16, 1999. Pursuant to the terms of the addendum, the redeveloper was required to provide written proof to the EDA prior to 4:30 p.m. on March 16, 1999, that all portions of the redevelopment property had been acquired by the redeveloper, other then those parcels owned by the EDA. The redeveloper had not provided the written documentation prescribed in the redevelopment agreement and its addendum. Thus, the EDA has certain rights pursuant to the addendum to acquire property from the redeveloper, if it so chooses. Mr. McCauley anticipated seeking RFPs sometime this spring. The EDA would look for developers who would be ready to proceed with demonstrated financing. 5. ADJOURNMENT A motion by Commissioner Hilstrom, seconded by Commissioner Nelson to adjourn the meeting at 8:11 p.m. Motion passed unanimously. President 03/22/99 -2- DRAFT EDA Agenda Item No. 4a , MEMORANDUM TO: Michael J. McCauley, City Manager FROM: Tom Bublitz, Community P Development Specialist P DATE: April 20, 1999 SUBJECT: Resolution Authorizing the Economic Development Authority in and for the City of Brooklyn Center to Apply for a Contamination Clean Up Grant From the Minnesota Department of Trade and Economic Development and Resolution Authorizing the Submission of a Grant Application to the Metropolitan Council for the Tax Base Revitalization Account To date, the Economic Development Authority has received $2,071,140 in grant funds for the clean up of the old Joslyn pole yard site. The Minnesota Department of Trade and Economic Development (DTED) has awarded $1,752,968 and the Metropolitan Council, through its tax base revitalization account program, has awarded $318,172. Financing for the clean up of the Joslyn site, comprehended in the Tax Increment Financing plan adopted by the City Council and EDA, includes a combination of State grant funds and Tax Increment Financing. The second round of potential State funding for clean up of the site includes a grant application to DTED and the Metropolitan Council. These grant applications would be the final round of grant funding for the site. The State grant funding, combined with Tax Increment Financing would provide funding for the extraordinary costs to make development of the site feasible and the overall development costs competitive with costs for uncontaminated land. The entire site includes approximately 46 acres, approximately 30 of which is developable. The initial grant funds received from DTED and the Metropolitan Council provided funding for the clean up of the easterly half of the site adjacent to Highway 100. The second round of grant applications essentially includes the westerly half of the site. The development of the westerly or "back" portion of the site will consist of a 202,400 sq. ft. distribution center for a major retailer. The grant applications to DTED and the Metropolitan Council, which are being prepared by Real Estate Recycling, will request in excess of $2,000,000 from the two State agencies. Awards from the State agencies are made on a competitive basis and award announcements are expected to be made in early July of 1999. Resolutions authorizing the submission of both grant applications are included with this memorandum. i Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION AUTHORIZING THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BROOKLYN CENTER TO APPLY FOR A CONTAMINATION CLEAN UP GRANT FROM THE MINNESOTA DEPARTMENT OF TRADE AND ECONOMIC DEVELOPMENT WHEREAS, the Economic Development Authority in and for the City of Brooklyn Center (EDA) acts as the legal sponsor for project(s) contained in the Contamination Cleanup Grant Program to be submitted on May 3, 1999; and WHEREAS, the Executive Director is hereby authorized to apply to the Department of Trade and Economic Development for funding of this project on behalf of the EDA; and WHEREAS, the EDA has the legal authority to apply for financial assistance, and the institutional, managerial and financial capability to ensure adequate project administration; and WHEREAS, the sources and amounts of the local match identified in the application are committed to the project identified; and • WHEREAS, the EDA has not violated any Federal, State or local laws pertaining to fraud, bribery, graft, kickbacks, collusion, conflict of interest or other unlawful or corrupt practice; and WHEREAS, upon approval of its application by the state, the EDA may enter into an agreement with the State of Minnesota for the above referenced project(s), and that the EDA certifies that it will comply with all applicable laws and regulations as stated in all contract agreements. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota that the Executive Director is hereby authorized to execute such agreements as are necessary to implement the project on behalf of the applicant. Date President The motion for the adoption of the foregoing resolution was duly seconded by commissioner and upon vote being taken thereon, the following voted in favor thereof: • and the following voted against the same: whereupon said resolution was declared duly passed and adopted. • Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION AUTHORIZING THE SUBMISSION OF A GRANT APPLICATION TO THE METROPOLITAN COUNCIL FOR THE TAX BASE REVITALIZATION ACCOUNT WHEREAS, the Economic Development Authority in and for the City of Brooklyn Center (EDA) is a participant in the Livable Communities Act Housing Incentives Program for 1999 as determined by the Metropolitan Council, and is therefore eligible to make application for funds under the Tax Base Revitalization Account; and WHEREAS, the EDA has identified a clean-up project known as the Joslyn Pole Yard site within the City that meets the Tax Base Revitalization account's purpose and criteria; and WHEREAS, the EDA has the institutional, managerial and financial capability to ensure adequate project administration; and WHEREAS, the EDA certifies that it will comply with all applicable laws and regulations as stated in the contract agreements; and . WHEREAS, the Economic Development Authority in and for the City of Brooklyn Center, Minnesota agrees to act as legal sponsor for the project contained in the Tax Base Revitalization grant application to be submitted on May 3, 1999. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota that the Executive Director is hereby authorized to apply to the Metropolitan Council for this funding on behalf of the Economic Development Authority in and for the City of Brooklyn Center and to execute such agreements as are necessary to implement the project on behalf of the applicant. Date President The motion for the adoption of the foregoing resolution was duly seconded by commissioner and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: • whereupon said resolution was declared duly passed and adopted. EDA Agenda Item No. 4b MEMORANDUM TO: Michael J. McCauley, City Manager FROM: Brad Hoffman, Community Development Director 1 DATE: April 22, 1999 SUBJECT: Resolution Approving and Authorizing Execution of a Development Agreement for the Joslyn Poleyard with Twin Lake Business Park (Real Estate Recycling) Proiect Descrintion The City of Brooklyn Center has an opportunity to realize the development of a polluted site that up to now was considered undevelopable. The Joslyn Pole Yard located at 49th and France would be combined with the Davies Water site on Lakebreeze along with the Northwest Racquet Club parking lot also on Lake Breeze to create three (3) I -2 building parcels totaling 25 to 27 buildable acres. With total development of all three (3) parcels there will be between 400,000 to 500,000 square feet of new office /warehouse space. The area has a current market value of $2,005,600 with a pay 1999 tax capacity of $65,471. The project, upon completion will have a minimum market value of approximately $14,000,000 with a potential market value in excess of $25,000,000 and a tax capacity potential ranging from $500,000 to approximately $900,000. The Joslyn Pole Yard site is a federally listed "super fund" site meaning it is one of the most polluted sites in the country. The development of the site requires the clean up of the area to a level approved by the PCA and EPA. The current level of clean up as undertaken by Joslyn is sufficient to allow Joslyn to fence the property, continue pumping ground water but take no further action towards the sites cleanup meaning the site would remain as is. Real Estate Recycling has been working with the PCA and EPA to P et a clean u program approved so the site will be delisted thus allowing its g P �' PP development. The developer can address this point however we believe there is an agreement now with the regulatory agencies to go forward with the project. The number of jobs created by the development can vary widely dependant upon the end users. However, with total development the number should range from 200 to 600 new full time jobs in Brooklyn Center. Plans for a large regional retail warehouse should be before the Planning Commission in May for construction this summer. The construction oft he Brooklyn Center site will have metro area impact with additional development and jobs. Current Proiect Status In October, 1998 the City authorized the application for grants to the Department of Trade and Economic Development and the Metropolitan Council to assist in the clean up of the site. Both grant applications have been funded. Between the two (2) grants Brooklyn Center will receive slightly more than $2 million in clean up assistance. It is intended to make application for additional grants to assist in the clean up. Additional grants will be necessary to realize the total development of the site. The City's tax increment assistance is but one part of the financing package and by itself will not be adequate to complete this project. We are currently at a point where at least one -half of the site would be developed if no other grants were obtained. In February, 1999 the City Council established a tax increment soils district to assist with the clean up. The district has a potential twenty (20) year term. Soil districts are limited to funding only those activities that alleviate the conditions that qualify the site as a soils district. At the Joslyn site the EDA is limited in its assistance to acquisition and clean up expenditures. Clean un It is estimated that slightly more than $12,660,000 in eligible acquisition and clean up costs have been identified. Eligible costs include ground water pumping for approximately twenty -five (25) years; soil treatment and clean up and soil compactions. The EDA will retain a private consultant familiar with the costs associated with cleaning polluted sites to review and approve all invoice submissions by the developer to assure that they are accurate and legitimate project costs. The developer will be available Monday evening to review with the Council the specifics of cleaning the site and getting it ready for development. As indicated tax increment by itself will not generate sufficient revenues to make this project go forward. It is however a key part in bridging the gap between the market value of comparable industrial land. The land with its clean up cost will come in at approximately $14 per square foot for • useable land. Comparable I -2 land in the northwest metro area sell for $1.50 to $2.25 per foot. The Agreement As written the Brooklyn Center EDA agrees to provide up to $4 million present valued at 8 percent in tax increment assistance on a pay as you go basis. A copy sample of the note can be found as Exhibit E of the agreement. The $4 million cap or maximum is qualified by a time limit of ten (10) years of full increment; a developers land cost to be no less than $2 million; and limited to actual eligible clean up and acquisition costs less any grants received. For example, if the developers actual eligible costs were $7 million and they received $4 million in grants the maximum TIF assistance would be $3 million. Further, if the developer's land and clean up costs were again $7 million and they received $5 million in grants, there would be no TIF assistance based upon $2 million owner land cost provisions. The EDA would issue a note to the developer for each parcel when a certificate of occupancy is issued. The certificate is issued when the building official approves the building for use upon completion. The issuance would also start the 10 year clock for TIF assistance. It should be noted however, that if the project does not receive a second round of grant funding, the agreement stipulates that Brooklyn Center would agree to extend the potential TIF assistance to fifteen (15) years of full TIF. Again the $4 million cap is still in place. The time extension makes it more likely that the developer will receive the maximum TIF assistance from the City. When the land is cleaned up and ready for construction but prior to construction there will be an • increased value which will generate a partial TIF. The agreement allows for the developer to receive TIF assistance prior to the issuance of the first note to help offset the continued costs of groundwater pumping. The partial TIF will count against the $4 million TIF assistance cap. Partial capture of the TIF by the developer without development cannot exceed five (5) years. The developer is responsible for making applications for all grants and is responsible for providing the City's matching funds called for in the grant. At Monday's meeting the Council will be asked to approve the application for two (2) more grants. It is incumbent upon the developer to clean the site up to a level approved the PCA and EPA for development and in fact develop the site in order to receive TIF funding. Attached you will find a copy of the development agreement. This memo reviews only the key obligations of the EDA and developer. Both the developer and myself will be available to address any questions the Council might have concerning the project, grants or the agreement. . G: \DEPTS\EDA\RESOLUTi \1999\DEVAG426.MEM • Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF A DEVELOPMENT AGREEMENT FOR THE JOSLYN POLEYARD WITH TWIN LAKE BUSINESS PARK (REAL ESTATE RECYCLING) WHEREAS, the Brooklyn Center Economic Development Authority (the "Authority ") has caused to be prepared a Development Agreement between the Authority and Twin Lakes Business Park, a Minnesota limited liability company (the "Development Agreement ") a form of which has been presented at this meeting; and WHEREAS, pursuant to the Development Agreement the Authority has agreed to provide tax increment assistance to the Developer to help pay the cost of the removal and remediation of certain hazardous substances on the Development Property (as defined in the Development Agreement). NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota as follows: • The Board of Commissioners hereby approves the Development Agreement in substantially the form submitted, and the and are hereby authorized and directed to execute the Development on behalf of the Authority. Date President The motion for the adoption of the foregoing resolution was duly seconded by commissioner and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. s • DEVELOPMENT AGREEMENT BY AND BETWEEN BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY AND TWIN LAKES BUSINESS PARK • This document drafted by: BRIGGS AND MORGAN (MMD) Professional Association 2200 West First National Bank Building St. Paul, Minnesota 55101 • 1009841.7 TABLE OF CONTENTS Page RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . 1 ARTICLE I - DEFINITIONS . . . . . . . . . . . . . . . . . . . . 3 Section 1.1. Definitions . . . . . . . . . . . . . . . . 3 ARTICLE II - REPRESENTATIONS AND WARRANTIES . . . . . . . . . . 6 Section 2.1. Representations and Warranties of the Authority . . . . . . . . . . . . . . . . . 6 Section 2.2. Representations and Warranties of the Developer . . . . . . . . . . . . . . . . . 6 ARTICLE III - CONSTRUCTION OF MINIMUM IMPROVEMENTS AND PAYMENT OF TAX INCREMENT ASSISTANCE . . . . . 9 Section 3.1. Preconditions to Issuance of Tax Increment Notes. . . . . . . . . . . . . . . . . . . 9 Section 3.2. Construction of Minimum Improvements . . . . 9 Section 3.3. Tax Increment Revenue Note . . . . . . . . 10 Section 3.4. Use of Tax Increments . . . . . . . . . . 12 Section 3.5. Public Purpose; Jobs Act Not Applicable. . 12 Section 3.6. State Grant . . . . . . . . . . . . . . . . 12 Section 3.7. Partial Tax Increments. . . . . . . . . . 13 ARTICLE IV - EVENTS OF DEFAULT . . . . . . . . . . . . . . . 14 Section 4.1. Events of Default Defined 14 Section 4.2. Remedies on Default . . . . . . . . . . . 15 Section 4.3. No Remedy Exclusive . . . . . . . . . . . 15 Section 4.4. No Implied Waiver . . . . . . . . . . . . 15 Section 4.5. Agreement to Pay Attorney's Fees and Expenses . . . . . . . . . . . . . . . 16 Section 4.6. Indemnification of Authority and City . . 16 ARTICLE V - ADDITIONAL PROVISIONS . . . . . . . . . . . . . . 17 Section 5.1. Conflicts of Interest . . . . . . . . . . 17 Section 5.2. Assignment . . . . . . . . . . . . . . . 17 Section 5.3. Titles of Articles and Sections . . . . . 17 Section 5.4. Notices and Demands . . . . . . . . . . . 17 Section 5.5. Counterparts . . . . . . . . . . . . . . . 18 Section 5.6. Law Governing . . . . . . . . . . . . . . 18 Section 5.7. Expiration . . . . . . . . . . . . . . . . 18 Section 5.8. Provisions Surviving Rescission or Expiration . . . . . . . . . . . . . . 18 EXHIBIT A - Legal Description of Tax Increment Financing (Soils Condition) District No. 4 . . . . . . . . A -1 EXHIBIT B - Legal Description of Development Property . . . . B -1 EXHIBIT C - Description of Eligible Costs . . . . . . . . . . C -1 EXHIBIT D - Certificate of Completion . . . . . . . . . . . . D -1 EXHIBIT E - Form of Tax Increment Note . . . . . . . . . . . E -1 • 1009841.7 DEVELOPMENT AGREEMENT THIS AGREEMENT, made as of the day of 1999, by and between the Brooklyn Center Economic Development Authority, Minnesota (the "Authority "), a body corporate and politic organized and existing under the laws of the State of Minnesota and Twin Lakes Business Park, a Minnesota limited liability company (the "Developer "), WITNESSETH: WHEREAS, pursuant to Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Law "), the Brooklyn Center Housing and Redevelopment Authority (the "HRA") has hereto formed Housing Development and Redevelopment Project No. 1 (the "Redevelopment Project ") and has adopted a redevelopment plan therefor (the "Redevelopment Plan "); and WHEREAS, pursuant to Minnesota Statutes, Section 469.091 to 469.1081, the Authority has the powers of a housing and redevelopment authority under the HRA Law, and has been P Y authorized by the City Council of the City of Brooklyn Center to carry out all powers and administer all projects initiated by the HRA; and WHEREAS, P ursuant to the provisions of Minnesota Statutes, Section 469.174 through 469.1791 as amended, (hereinafter the "T Increment Act" the Authority has created within the ax Increm ), , Y Redevelopment Project, Tax Increment Financing (Soils Condition) District No. 4 as a soils condition district (the "Tax Increment District "), the legal description of which is attached hereto as Exhibit A, and has adopted a tax increment financing plan therefor (the "Tax Increment Plan ") which provides for the use of tax increment financing in connection with development of certain property within the Redevelopment Project; and WHEREAS, in order to achieve the objectives of the Redevelopment Plan and particularly to make the land in the Redevelopment Project available for development by private enterprise in conformance with the Redevelopment Plan, the Authority has determined to assist the Developer with certain removal and remediation actions associated with the contaminated property formerly known as the Joslyn wood pole treating site, which property is located within the Tax Increment District; and WHEREAS, the Authority believes that the remediation and removal of hazardous substances on certain property in the Tax Increment Financing District, and fulfillment of this Agreement are in the best interests of the City of Brooklyn Center, and in accordance with the public purpose and provisions of the • 1009841.7 • applicable state and local laws and requirements under which it will be undertaken. NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: • 1009841.7 2 • ARTICLE I DEFINITIONS Section 1.1. Definitions. All capitalized terms used and not otherwise defined herein shall have the following meanings unless a different meaning clearly appears from the context: Agreement means this Agreement, as the same may be from time to time modified, amended or supplemented; Authoritv means the Brooklyn Center Economic Development Authority; Certificate of Completion means the Certificate of Completion in substantially the form attached hereto as Exhibit D; City means the City of Brooklyn Center, Minnesota; Construction Plans means the plans, specifications, drawings and related documents of the construction work for the Minimum Improvements. The plans (a) shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the building inspector of the City, and (b) shall include at least the following: (1) site plan; (2) foundation plan; (3) basement plans; (4) floor plan for each floor; (5) cross sections of each (length and width); (6) elevations (all sides); and (7) landscape plan; Committed Eligible Costs means Eligible Costs for which the Developer has presented the Authority with invoices evidencing payment of such Eligible Costs or evidence that such Eligible Costs have been incurred, all as contemplated by Section 3.1(c) hereof; Comnleted Minimum Improvement means a Minimum Improvement for which a Certificate of Completion has been issued; Countv means Hennepin County, Minnesota; Developer means Twin Lakes Business Park, a Minnesota limited liability company, its successors and assigns; Developer's Lender means any financial institution which lends funds to the Developer to pay the costs of the Removal and Remediation Work or to finance the construction of the Minimum Improvements. Development Action Response Plan means the plan dated October 30, 1998 for removal and remedial work to be undertaken on the Development Property, which plan was approved by the • 1009841.7 3 Commissioner of the Minnesota Pollution Control Agency on November 2, 1998; Development Property means certain land located within the Tax Increment District and legally described on Exhibit B attached hereto; Eliaible Costs means (a) the costs of the Removal or Remediation Work, (b) the costs of acquiring the parcels on which the Removal and Remediation Work will be taken, and (c) the costs of preparation of the Development Action Response Plan, all as more particularly set forth on Exhibit C attached hereto; Event of Default means any of the events described in Section 4.1; Final Pavment Date means with respect to Tax Increments derived from each Minimum Improvement constructed on the Development Property, the February 1 or August 1 date as of which the Authority has received and paid 10 years of full Tax Increments generated by such Minimum Improvements; provided that if the City does not receive the Additional Grant, the Final Payment Date shall be the date as of which the Authority has received and paid 15 years of full Tax Increments, all as contemplated by Section 3.6 hereof; • Grants means any grants received from the Minnesota Department of Trade and Economic Development, the Metropolitan Council or any other federal, state or local agency or entity for the Removal and Remediation Work; Ground Lessor means Joslyn Manufacturing and Supply Corporation, its successors and assigns; Minimum Improvement or Minimum Improvements means the building or buildings to be constructed on the Development Property in accordance with the Construction Plans; MPCA means the Minnesota Pollution Control Agency; Note Pavment Date means February 1 and August 1 of each year commencing with the February 1 or August 1 first following the date of issuance of the Note and each February 1 and August 1 thereafter through and including the Final Payment Date; Removal and Remediation Work means the removal and remediation work to be undertaken on the Development Property in accordance with the Development Action Response Plan, including the work required under the related Response Order by Consent issued by the MPCA in 1985 and Record of Decision issued in 1989; State means the State of Minnesota; • 1009841.7 4 Tax Increment Act means Minnesota Statutes, Sections 469.174 through 469.1791, as amended; Tax Increment District means Tax Increment Financing (Soils Condition) District No. 4 legally described in Exhibit A attached hereto and qualified as a soils condition district under the Tax Increment Act; Tax Increment Financina Plan means the plan approved for the Tax Increment District; Tax Increment Notes or Notes means the tax increment notes to be issued in substantially the form attached hereto as Exhibit E; Tax Increments means the tax increments derived from the Development Property which have been received and retained by the Authority in accordance with the provisions of Minnesota Statutes, Section 469.177, or otherwise pursuant to the Tax Increment Act; Unavoidable Delays means delays, outside the control of the party claiming its occurrence, which are the direct result of strikes, other labor troubles, unusually severe or prolonged bad weather, acts of God, fire or other casualty to the Project, litigation commenced by third parties which, by injunction or other similar judicial action or by the exercise of reasonable discretion, directly results in delays, or acts of any federal, state or local governmental unit (other than the Authority or the City) which directly result in delays. I • 1009841.7 5 • ARTICLE II REPRESENTATIONS AND WARRANTIES Section 2.1. Representations and Warranties of the Authoritv. The Authority makes the following representations and warranties: (1) The Authority is a body corporate and politic of the State of Minnesota and has the power to enter into this Agreement and carry out its obligations hereunder. (2) The Tax Increment District is a "soils condition district" within the meaning of Minnesota Statutes, Section 469.174, Subdivision 19 and was created, adopted and approved in accordance with the terms of the Tax Increment Act. (3) The development contemplated by this Agreement is in conformance with the objectives set forth in the Redevelopment Plan. (4) The Authority proposes, subject to the further provisions of this Agreement, to issue the Notes and apply Tax Increments to reimburse the Developer for Eligible Costs as set forth in Section 3.1 of the Agreement. . (5) The Authority and City will make all reasonable efforts to assist the Developer to secure Grants in addition to those heretofore awarded; provided that nothing herein shall be construed to require the City or Authority to make any local matching contributions which may be a prerequisite to award of a grant. Section 2.2. Representations and Warranties of the Developer. The Developer makes the following representations and warranties: (1) The Developer is a limited liability company, duly formed and existing under the laws of the State of Minnesota, is in good standing and duly authorized to conduct its business in the State of Minnesota and all other states where its activities require such authorization, has the power to enter into this Agreement, and by proper corporate action has authorized the execution and delivery of this Agreement. (2) The Development Action Response Plan specifying the Removal or Remediation Work was submitted to the Minnesota Pollution Control Agency and approved by the Commissioner on November 2, 1998. (3) The Developer will undertake the Removal and Remediation Work in accordance with the Development Action 1009841.7 6 . Response Plan and all local, state and federal laws and regulations (including, but not limited to, environmental, zoning, energy conservation, building code and public health laws and regulations). (4) The Removal or Remediation Work and the subsequent development of the Development Property by the construction of the Minimum Improvements would not be undertaken by the Developer, and in the opinion of the Developer would not be economically feasible within the reasonably foreseeable future, without the assistance and benefit to the Developer provided for in this Agreement. (5) The Developer will obtain, or cause to be obtained, in a timely manner, all required permits, licenses and approvals, and will meet, in a timely manner, all requirements of all applicable local, state, and federal laws and regulations which must be obtained or met before the Removal or Remediation Work and construction of the Minimum Improvements may be lawfully undertaken. (6) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions or provision of any contractual restriction, evidence of indebtedness, agreement or instrument of whatever nature to which the Developer is now a party or by which it is bound, or constitutes a default under any of the foregoing. (7) The Developer will cooperate fully with the City and the Authority with respect to any litigation commenced with respect to the Development Property. (8) Except to the extent the interests of the Developer and the City or Authority are adverse, the Developer will cooperate fully with the City and the Authority in resolution of any traffic, parking, public nuisance, or public safety problems which may arise in connection with the Development Property. (9) The Removal or Remediation Work has commenced and the Developer will proceed with due diligence to complete the Removal and Remediation Work. The Developer has or will enter into binding contracts with third parties to undertake the Removal or Remediation Work, as required by Minnesota Statutes, Section 469.1763, Subd. 3(a)(3), within 5 years of certification of the original tax capacity of the Tax Increment District. (10) The Developer expects the construction of the first Minimum Improvement to commence by December 31, 2003. Upon completion of the construction of the Minimum Improvements, the • 1009841.7 7 Developer expects the market value of the Development Property to be in excess of $13,500,000. • • 1009841.7 8 • ARTICLE III CONSTRUCTION OF MINIMUM IMPROVEMENTS AND PAYMENT OF TAX INCREMENT ASSISTANCE Section 3.1. Preconditions to Issuance of Tax Increment Notes. The Developer will pay the costs of the Removal and Remediation Work and all other Eligible Costs. In order to reimburse the Developer for a portion of the Eligible Costs, the Authority agrees to provide tax increment assistance to the Developer on a pay -as- you -go basis as further set forth in this Agreement. The Authority will reimburse the Developer for the Eligible Costs by the issuance of one or more Tax Increment Notes. A separate Note will be issued upon completion of each Minimum Improvement and will be payable solely from 97.50% of the Tax Increments generated by the Completed Minimum Improvement which gave rise to issuance of the applicable Note. The aggregate principal amount of the Notes shall be the lesser of (a) $4,000,000, (b) the actual out -of- pocket costs of the Developer for the Eligible Costs less all Grant proceeds, or (c) the amount which, when deducted from all capital costs paid by the Developer to acquire and prepare the Development Property for development including acquisition, Removal and Remediation Work and demolition costs not otherwise reimbursed from Grant proceeds, will not result in the Developer's actual out -of- pocket costs being less than $2,000,000. The tax increment assistance shall be paid on the terms and conditions set forth in Section 3.2 below. The Authority shall issue a Tax Increment Note upon satisfaction of the following conditions precedent: (a) The Developer shall be in material compliance with all the terms and provisions of this Agreement; (b) The Developer shall have completed construction of a Minimum Improvement and the Authority shall have issued a Certificate of Completion with respect to such Minimum Improvement as provided in Section 3.2 hereof; and (c) The Developer shall have delivered to the Authority either (a) evidence acceptable to the Authority that the Developer has incurred the Eligible Costs, or (b) invoices evidencing payment by the Developer of the Eligible Costs, which Committed Eligible Costs were not to be financed by a previously issued Note. Section 3.2. Construction of Minimum Improvements,. (1) The Developer agrees that it will construct each Minimum Improvement on the Development Property in conformance with the Construction Plans. Prior to commencement of a Minimum Improvement, the Developer shall submit to the Authority the Construction Plans for a Minimum Improvement, a legal description • 1009841.7 9 of the portion of the Development Property on which the Minimum • Improvement will be constructed, and all approvals required under the City's building, zoning or other ordinances or regulations. (2) After completion of each Minimum Improvement, the Developer shall request the Authority to execute a Certificate of Completion, in substantially the form set forth in Exhibit D attached hereto. The Authority shall execute a Certificate of Completion if the Minimum Improvements have been constructed in accordance with the Construction Plans and all of the relevant City building and zoning regulations and ordinances. If the Authority refuses or fails to provide a Certificate of Completion in the form attached hereto as Exhibit D, in accordance with the provisions of this Section 3.2(2), the Authority shall, within ten (10) days after written request by the Developer, provide the Developer with a written statement indicating in adequate detail in what respects the Developer has failed to complete the Minimum Improvement, and what measures or acts are necessary, in the opinion of the Authority, for the Developer to take or perform in order to obtain such Certificate of Completion. Upon issuance of a Certificate of Completion for a Minimum Improvement, such Minimum Improvement shall constitute a Completed Minimum Improvement and, upon satisfaction of the other conditions in Section 3.1 hereof, the Authority shall issue a Note in accordance with Section 3.3 hereof. • Section 3.3. Tax Increment Revenue Note. (1) Upon satisfaction of the conditions in Sections 3.1 and 3.2 hereof, the Authority will reimburse the Developer for Committed Eligible Costs through the issuance of a Tax Increment Revenue Note in substantially the form attached to this Agreement as Exhibit E. (2) The principal amount of the Note shall be equal to the lesser of (a) the Committed Eligible Costs not covered by a previously issued Note, or (b) the present value of 97.50% of the Tax Increments estimated to be generated by the Completed Minimum Improvement that gave rise to the issuance of the Note through the Final Payment Date of the Note, such amount to be discounted to the date of issuance of the Note at a discount rate of 8.00 %. The Note shall bear simple, non - compounded interest at the rate of eight per cent (8.00%) per annum from the date of issuance of the Note. Interest shall be computed on the basis of a 360 day year consisting of twelve (12) 30 -day months. (3) Each Note shall identify the Completed Minimum Improvement which gave rise to issuance of the Note, and the principal of the Note and interest thereon shall be payable solely from 97.50% of the Tax Increments generated by the applicable Completed Minimum Improvement and that portion of the Development Property on which it is located. • 1009841.7 10 (4) All Notes shall be special and limited obligations of the Authority and not general obligations of the Authority, and only the applicable Tax Increments shall be used to pay the principal of and interest on the Notes. If, on any Note Payment Date, the applicable Tax Increments pledged for the payment of the accrued and unpaid interest on the Note are insufficient for such purposes, the difference shall be carried forward and shall be paid if and to the extent that on a future Note Payment Date there are Tax Increments in excess of the amounts needed to pay the accrued interest then due on the Note. (5) The Authority's obligation to make payments on the Note on any Note Payment Date shall be conditioned upon the requirement that (A) there shall not at that time be an Event of Default that has occurred and is continuing under this Agreement and (B) this Agreement shall not have been terminated pursuant to Section 4 .2 (b) . (6) The Notes shall be governed by and payable pursuant to the additional terms thereof, as set forth in Exhibit D. In the event of any conflict between the terms of the Notes and the terms of this Section 3.2, the terms of the Notes shall govern. The issuance of the Notes pursuant and subject to the terms of this Agreement are hereby authorized and approved by the Authority. • (7) The Authority hereby consents to any assignment by the Developer of the Notes to the Developer's Lender or the Ground Lessor. The Developer shall promptly notify the Authority of any such assignment. (8) The Authority hereby acknowledges that the Developer may, after completion of a Minimum Improvement, request the Authority to consent to (a) an assignment to a third party purchaser (the "Third Party Purchaser ") of the Developer's obligations under this Agreement with respect to a Completed Minimum Improvement sold to a Third Party Purchaser and that portion of the Development Property on which it is located (the "Acquired Property ") and (b) an assignment of the related Tax Increment Note to such Third Party Purchaser. The Authority agrees that its consent to any such assignments to a Third Party Purchaser will not be unreasonably withheld; provided that the Authority may require, as a condition to its consent, the satisfaction of the following requirements: (i) any proposed assignee shall have the qualifications and financial responsibility, in the reasonable judgment of the Authority, necessary and adequate to fulfill the obligations undertaken in this Agreement by the assignor. • 1009841.7 1 1 (ii) any proposed assignee, by instrument in writing satisfactory to the Authority, shall, for itself and its successors and assigns, and expressly for the benefit of the Authority, have expressly assumed all of the obligations of the Developer under this Agreement with respect to the Acquired Property and agreed to be subject to all the conditions and restrictions to which the Developer is subject; (iii) there shall not have occurred an Event of Default by the Developer which remains uncured. (iv) there shall be submitted to the Authority for review and prior written approval all instruments and other legal documents described above or otherwise involved in effecting the transfer of any such interest in this Agreement. Section 3.4. Use of Tax Increments. The Authority and the City shall be free to use the Tax Increments, other than those to which the Developer is entitled pursuant to the provisions of Section 3.3 hereof, for its administrative expenses and for any other purpose for which the Tax Increments may lawfully be used pursuant to applicable provisions of the Minnesota law. Section 3.5. Public Puroose; Jobs Act Not Applicable. The primary purpose of this Agreement and the tax increment assistance contemplated hereby is to assist with the clean up of polluted property in the Tax Increment District, which would not occur without the tax increment assistance provided hereunder. The removal and remediation of the hazardous substances will permit development to occur on the Development Property, which will, in turn, increase the tax base of the City. Therefore, the provision of Minnesota Statutes, Section 116J.991 (the "Jobs Act ") do not apply to the assistance granted pursuant to this Agreement. Section 3.6. State Grant. The Minnesota Department of Trade and Economic Development ("DTED") and the Metropolitan Council have heretofore made grants to the City in the aggregate principal amount of $2,071,140 for a portion of the Eligible Costs. The Developer agrees to apply, on behalf of the City, to DTED for an additional grant in the principal amount of at least $2,000,000 for the Eligible Costs (the "Additional Grant "). Nothing herein shall be construed to obligate the Authority or the City to provide any local matching funds required as a precondition to receipt of the Additional Grant, other than the tax increment financing assistance to be provided pursuant to this Agreement. If the City does not receive the Additional Grant, the Authority agrees that the Final Payment Date of the Notes will be increased from 10 to 15 years of full Tax Increments. • 1009841.7 12 • Section 3.7. Partial Tax Increments. The Authority and the Developer anticipate that the Authority will receive Tax Increments prior to the completion of the Minimum Improvements as a result of the increased value of the land resulting from the Removal and Remediation Work (the "Pre- Development Tax Increments "). The Authority agrees that prior to the issuance of a Tax Increment Note it will collect the Pre - Development Tax Increments and remit them to the Developer upon receipt of a written request from the Developer provided that the Authority shall not be required to remit any Pre - Development Tax Increments to the Developer after December 31, 2004, unless a Tax Increment Note has been issued by such date. The Pre - Development Tax Increments shall be included in the aggregate limit of the principal amount of Tax Increment Assistance to be paid to the Developer as provided in Section 3.1 hereof. • 1009841.7 13 • ARTICLE IV EVENTS OF DEFAULT Section 4.1. Events of Default Defined. 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 any one or more of the following events: (a) A default in the payments of ad valorem real property taxes assessed with respect to the Development Property; (b) Failure by the Developer to commence and complete the Removal or Remediation Work (excluding any operation, maintenance and monitoring activities) pursuant to the terms and conditions of the Development Action Response Plan by December 31, 2003; (c) Subject to Unavoidable Delays, failure of the Developer to observe or perform any other covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement; or (d) If the Developer shall (A) file any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act of 1978, as amended or under any similar federal or state law; or (B) make a general assignment for the benefit of its creditors; or I (C) admit in writing its inability to pay its debts generally as they become due; or (D) be adjudicated as bankrupt or insolvent; or if a petition or answer proposing the adjudication of the Developer, 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 petition or answer shall not be discharged or denied within sixty (60) days after the filing thereof; or a receiver, trustee or liquidator of the Developer, or of the Project, or part thereof, shall be appointed in any proceeding brought against the Developer, and shall not be discharged within sixty (60) days after such appointment, or if the Developer, shall consent to or acquiesce in such appointment. • 1009841.7 14 • Section 4.2. Remedies on Default. Whenever any Event of Default referred to in Section 4.1 occurs and is continuing, the Authority may take any one or more of the following actions after the giving of thirty (30) days' written notice to the Developer, but only if the Event of Default has not been cured within said thirty (30) days, or, if said Event of Default cannot reasonably be cured within the time, the Developer fails to give assurances reasonably satisfactory to the Authority that the Event of Default will be cured within a period of time reasonably acceptable to the Authority, but in any event not to exceed an additional period of 120 days; (a) The Authority may suspend its performance under this Agreement until it receives assurances from the Developer, deemed adequate by the Authority, that the Developer will cure its default and continue its performance under this Agreement. (b) The Authority may cancel and terminate the Agreement. (c) The Authority may take any action, which may appear necessary or desirable to enforce performance and observance of any obligation, agreement, or covenant of the Developer under this Agreement. • Notwithstanding the foregoing, in the event the Authority has consented to an assignment to a Third Party Purchaser as contemplated in Section 3.3(8) hereof of the Developer's obligations under this Agreement with respect to Acquired Property, if an event of Default occurs hereunder with respect to the Acquired Property or the Third Party Purchaser, the Authority may exercise its remedies hereunder only against the defaulting Third Party Purchaser. Section 4.3. No Remedv Exclusive. No remedy herein conferred upon or reserved to the Authority is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. Section 4.4. No Imolied Waiver. In the event any agreement contained in this Agreement should be breached by any party and thereafter waived by any other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent • breach hereunder. 1009841.7 15 Section 4.5. Agreement to Pav Attornev's Fees and Expenses. Whenever any Event of Default occurs and the Authority or City shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement or performance or observance of any obligation or agreement on the part of the Developer herein contained, the Developer agrees that it shall, on demand therefor, pay to the Authority or City the reasonable fees of such attorneys and such other expenses so incurred by the Authority or City. Section 4.6. Indemnification of Authoritv and Citv. (1) The Developer releases from and covenants and agrees that the Authority and the City, their governing body members, officers, agents, including the independent contractors, consultants and legal counsel, servants and employees thereof (hereinafter, for purposes of this Section, collectively the "Indemnified Parties ") shall not be liable for and agrees to indemnify and hold harmless the Indemnified Parties against any loss or damage to property or any injury to or death of any person occurring at or about or resulting from the acquisition, ownership, development and use of the Development Property to the extent not attributable to the negligence of the Indemnified Parties. (2) Except for any willful misrepresentation or any willful • or wanton misconduct of the Indemnified Parties, the Developer agrees to protect and defend the Indemnified Parties, and further agrees to hold the aforesaid harmless from any claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising from the actions or inactions of the Developer (or if other persons acting on its behalf or under its direction or control) under this Agreement, or the transactions contemplated hereby or arising from the Developer's acquisition, ownership, development and use of the Development Property; provided, that this indemnification shall not apply to the warranties made or obligations undertaken by the Authority in this Agreement. (3) All covenants, stipulations, promises, agreements and obligations of the Authority contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Authority and not of any governing body member, officer, agent, servant or employee of the Authority or the City, as the case may be. 1009841.7 16 • ARTICLE V ADDITIONAL PROVISIONS Section 5.1. Conflicts of Interest. No member of the governing body or other official of the Authority or the City shall have any financial interest, direct or indirect, in this Agreement, the Development Property or the Minimum Improvements, or any contract, agreement or other transaction contemplated to occur or be undertaken thereunder or with respect thereto, nor shall any such member of the governing body or other official participate in any decision relating to the Agreement which affects his or her personal interests or the interests of any corporation, partnership or association in which he or she is directly or indirectly interested. No member, official or employee of the Authority or the City shall be personally liable to the City in the event of any default or breach by the Developer or successor or on any obligations under the terms of this Agreement. Section 5.2. Assianment. The Development Property may be sold or transferred by the Developer without the consent of the City or the Authority. This Agreement is not assignable without the prior written consent of the Authority. With the exception of the Ground Lease, and the Developer's Lender, or any purchaser of a Completed Minimum Improvement, the Notes are not assignable without the prior written consent of the Authority. Section 5.3. Titles of Articles and Sections.. Any titles of the several parts, articles and sections of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 5.4. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand or other communication under this Agreement by any party to any other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally, and (a) in the case of the Developer is addressed to or delivered personally to: Twin Lakes Business Park Metropolitan Centre Suite 3060 333 South 7th Street Minneapolis, MN 55402 (b) in the case of the Authority is addressed to or delivered personally to the Authority at: • 1009841.7 17 • Brooklyn Center Economic Development Authority 6301 Shingle Creek Parkway Brooklyn Center, Minnesota 55430 ATTN: Executive Director or at such other address with respect to any such party as that party may, from time to time, designate in writing and forward to the other, as provided in this Section. Section 5.5. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 5.6. Law Governina. This Agreement will be governed and construed in accordance with the laws of the State. Section 5.7. Expiration. This Agreement shall expire on the Final Payment Date unless earlier terminated or rescinded in accordance with its terms. Section 5.8. Provisions Survivina Rescission or Expiration. Sections 4.5 and 4.6 shall survive any rescission, termination or expiration of this Agreement with respect to or arising out of any event, occurrence or circumstance existing prior to the date thereof. • • 1009841.7 18 • IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and on its behalf and the Developer has caused this Agreement to be duly executed in its name and on its behalf, on or as of the date first above written. BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY By Its By Its This is a signature page to the Development Agreement dated 1999, by and between the Brooklyn Center Economic Development Authority and Twin Lakes Business Park. • 1009841.7 19 TWIN LAKES BUSINESS PARK By Its This is a signature page to the Development Agreement dated 1999, by and between the Brooklyn Center • Economic Development Authority and Twin Lakes Business Park. 1009841.7 20 . EXHIBIT A Legal Description of Tax Increment Financing (Soils Condition) District No. 4 Parcel ID Number Legal Description 01- 118 -21 -31 -0008 Lot 3, Block 1, Dale & Davies 1st Addition 10- 118 -21 -31 -0028 Lot 2, Block 1, Dale & Davies 3rd Addition 10- 118 -21 -31 -0027 Lot 1, Block 1, Dale & Davies 3rd Addition 10- 118 -21 -23 -0004 Unplatted 10- 118 -21, that part of govt Lot 2 lying swly, of rr r/w ex road • 1009841.7 A-1 EXHIBIT B Legal Description of Development Property Joslyn Site: Lot 2, Section 10, Township 118, Range 21, West of the Fifth Principal Meridian, lying southwesterly of the right -of -way of the Minneapolis, St. Paul & Sault Ste. Marie Railway Company. PID 10- 118 -21 -23 -0004. Northwest Parking Lot Site: Dale & Davies 3 rd Addition, Lot 2, Block 1. PID 10- 118 -21 -31 -0028. Davies Water Site: Dale & Davies 1 St Addition, Lot 3, Block 1. PID 10-118-21-31-0008. • • 1009841.7 $ -] EXHIBIT C • Description of Eligible Costs Soils /Environmental $3,207,950.00 Geotechnical 1,000,000.00 Acquisition 4,540,000.00 Contingency 466,902.00 Groundwater Pumping and Monitoring 3,450,000.00 • • 1009841.7 C -1 EXHIBIT D Certificate of Completion WHEREAS, the Brooklyn Center Economic Development Authority, a public body corporate and politic (the "Authority ") hereby certifies that the construction of the Minimum Improvement described on Schedule 1 attached hereto and located on the real estate described on Schedule 2 attached hereto by Twin Lakes Business Park, a Minnesota limited liability company (the "Developer ") under that certain Development Agreement dated 1999 (the "Development Agreement ") by and between the Authority and the Developer, has been completed. BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY By Its • • 1009841.7 D-1 • EXHIBIT E Form of Tax Increment Note UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY TAX INCREMENT REVENUE NOTE (TWIN LAKES BUSINESS PARK) The Brooklyn Center Economic Development Authority, Minnesota (the "Authority "), hereby acknowledges itself to be indebted and, for value received, hereby promises to pay the amounts hereinafter described (the "Payment Amounts ") to Twin Lakes Business Park, a Minnesota limited liability company, or its registered assigns (the "Registered Owner "), but only in the manner, at the times, from the sources of revenue, and to the extent hereinafter provided. The principal amount of this Note shall equal from time to time the principal amount stated above, as reduced to the extent that such principal shall have been paid in whole or in part pursuant to the terms hereof and as provided in that certain Development Agreement, dated as of , 1999, as the same may be amended from time to time (the "Development Agreement "), by and between the Brooklyn Center Economic Development Authority, Minnesota (the "Authority "), and Twin Lakes Business Park, a Minnesota limited liability company (the "Company "). The unpaid principal amount hereof shall bear interest from the date of this Note at the simple, non - compounded rate of eight percent (8.00)o per annum. Interest shall be computed on the basis of a 360 -day year of twelve (12) 30 -day months. The amounts due under this Note shall be payable on each February 1 and August 1 of each year (the "Payment Dates "), commencing on the February 1 or August 1 first occurring after the date of issuance of this Note to and including the February 1 or August 1 date as of which the Authority has received [10] years of full Tax Increments generated by the Minimum Improvements described on Schedule 1 attached hereto (the "Final Payment Date ") or, if the first should not be a Business Day (as " [extend to 15 if Additional Grant not received] • 1009841.7 E -1 defined in the Development Agreement) the next succeeding Business Day. On each Payment Date the Authority shall pay by check or draft mailed to the person that was the Registered Owner of this Note at the close of the last business day preceding such Payment Date an amount equal to 97.50% of the Tax Increments (as hereinafter defined) received by the Authority during the six month period preceding such Payment Date. The Payment Amounts due hereon shall be payable solely from tax increments (the "Tax Increments ") derived from that portion of the Development Property (as defined in the Development Agreement) on which the Minimum Improvement which gave rise to the issuance of this Note is located, which Minimum Improvement and portion of the Development Property are described on Schedule 1 attached hereto, and which Tax Increments are paid to the Authority and which the Authority is entitled to retain pursuant to the provisions of Minnesota Statutes, Sections 469.174 through 469.179, as the same may be amended or supplemented from time to time (the "Tax Increment Act "). This Note shall terminate and be of no further force and effect following the Final Payment Date defined above, on any date upon which the Authority shall have terminated the Development Agreement under Section 4.2(b) thereof, or on the date that all principal and interest payable hereunder shall have been paid in full, whichever occurs earliest. The Authority makes no representation or covenant, express or implied, that the Tax Increments will be sufficient to pay, in whole or in part, the amounts which are or may become due and payable hereunder. The Authority's payment obligations hereunder shall be further conditioned on the fact that no Event of Default under the Development Agreement shall have occurred and be continuing at the time payment is otherwise due hereunder, but such unpaid amounts shall become payable, if said Event of Default shall thereafter have been cured; and, further, if pursuant to the occurrence of an Event of Default under the Development Agreement the Authority elects to cancel and rescind the Development Agreement, the Authority shall have no further debt or obligation under this Note whatsoever. Reference is hereby made to all of the provisions of the Development Agreement, including without limitation Section 4.2 thereof, for a fuller statement of the rights and obligations of the Authority to pay the principal of this Note and the interest thereon, and said provisions are hereby incorporated into this Note as though set out in full herein. This Note is a special, limited revenue obligation and not a general obligation of the Authority and is payable by the City only from the sources and subject to the qualifications stated or referenced herein. This Note is not a general obligation of the • 1009841.7 E -2 • City of Brooklyn Center, Minnesota, and neither the full faith and credit nor the taxing powers of the Authority are pledged to the payment of the principal of or interest on this Note and no property or other asset of the Authority, save and except the above - referenced Tax Increments, is or shall be a source of payment of the Authority's obligations hereunder. This Note is issued by the Authority in aid of financing a project pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including the Tax Increment Act. This Note may be assigned in accordance with the provisions of the Development Agreement consent of the Authority. In order to assign the Note, the assignee shall surrender the same to the Authority either in exchange for a new fully registered note or for transfer of this Note on the registration records for the Note maintained by the City. Each permitted assignee shall take this Note subject to the foregoing conditions and subject to all provisions stated or referenced herein. IT IS HEREBY CERTIFIED AND RECITED that all acts, condi- tions, and things required by the Constitution and laws of the State of Minnesota to be done, to have happened, and to be performed precedent to and in the issuance of this Note have been done, have happened, and have been performed in regular and due form, time, and manner as required by law; and that this Note, together with all other indebtedness of the Authority outstanding on the date hereof and on the date of its actual issuance and delivery, does not cause the indebtedness of the Authority to exceed any constitutional statutory limitation thereon. IN WITNESS WHEREOF, the Brooklyn Center Economic Development Authority has caused this Note to be executed by the manual signatures of its and and has caused this Note to be issued on and dated 199 By By Its Its 1009841.7 E-3 • Schedule 1 To Tax Increment Note [Insert description of completed Minimum Improvement and legal description of that portion of the Development Property on which the Completed Minimum Improvement is located] • • 1009941.7 E -4 • CERTIFICATE OF REGISTRATION It is hereby certified that the foregoing Note, as originally issued on , 199 , was on said date registered P in the name of Twin Lakes Business ark, a Minnesota limited liability company, and that, at the request of the Registered Owner of this Note, the undersigned has this day registered the Note in the name of such Registered Owner, as indicated in the registration blank below, on the books kept by the undersigned for such purposes. NAME AND ADDRESS DATE OF SIGNATURE OF REGISTERED OWNER REGISTRATION OF SECRETARY Twin Lakes Business Park • 1009841.7 E -5 . ASSIGNMENT FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto (Please print or typewrite name and address of Transferee. Include information for all joint owners if the Note is held by joint account) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints attorney to transfer the within Note on the books kept for registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed by: • Signature(s) must be Notice: The signature(s) on guaranteed by a commercial this assignment must bank or trust company or by a correspond with the name(s) brokerage firm having member- appearing on the face of this ship in one of the major stock Note in every particular, exchanges. without alteration or any change whatever. Please insert Social Security Number or other identifying number of Assignee. • 1009941.7 E -6