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WHEREAS, the City Council held a public hearing on the TIF Plan on June 19, 1995, <br />is and approved the TIF Plan on that date; and <br />WHEREAS, an Economic Development Tax Increment Financing District ( "TIF <br />District ") was established on the Development Site, legally described as follows: <br />Lots 6 and 7, Block 1, McChesney Industrial Park <br />; and <br />WHEREAS, the Tax Increment Financing Plan for the TIF District provides for the <br />Developer to be reimbursed, in an amount up to fifteen percent (15 %) of the assessed market <br />value of the Project as of January 2, 1997, over a series of years upon evidencing payment of <br />annual real estate taxes; and <br />WHEREAS, the 1998 real estate tax year is the first year Developer is eligible for a <br />reimbursement payment, based on the January 2, 1997, value of the Project; <br />NOW, THEREFORE, BE IT RESOLVED that the City, the EDA and the Developer <br />agree on the following terms and conditions for reimbursement of the Development Cosm: <br />I. The EDA hereby pledges the Tax Increment it receives from the TIF District to <br />the City of Elk River to enable the City to reimburse Developer for the <br />• Development Costs identified in the TIF Plan. <br />2. Payments shall be made by the City to Developer, in a total amount not to exceed <br />Developer's actual Development Costs or fifteen percent (15 %) of the assessed <br />market value of the Project as of January 2, 1997, whichever is less, pursuant to <br />the terms of the Note attached as Exhibit A to this Agreement (the "Note "). <br />3. The sole source of funds for payment of the City's obligations under the Note <br />shall be the tax increment generated by the TIF District. If taxes are not paid, <br />or taxes paid are not sufficient to generate tax increment, no payment on the Note <br />shall be due from the City. <br />4. The annual tax increment payment will be determined by the City's Finance <br />Director, and will take into consideration the original tax capacity of the <br />Development Site prior to the construction of the Project. <br />5. If Developer fails to make real estate tax payments prior to the date when said <br />taxes are due to Sherburne County, an Event of Default under this Agreement <br />shall exist. No payments shall be made to Developer under the terms of the Note <br />if an Event of Default occurs, and payments shall not be resumed until the <br />0 PXB RKW45.02 <br />2 <br />