Agenda - Council - 09/27/2011 - Special

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Tax Increments the City receives on or after June 1, 2015 shall be used to pay the principal of and interest accruing on the TIF Note. Section 6.6 Conditions Subsequent. The City's obligation to make payments on the TIF Note on any TIF Note Payment Date or any date thereafter is conditioned upon the requirements that (i) there shall not be, at the time payment is due, any Event of Default that has occurred and is continuing; and (ii) the City shall not have canceled and rescinded the TIF Note pursuant to Section 13.2(d). Section 6.7 Terms of the TIF Note. The TIF Note shall be governed by and payable pursuant to the additional terms thereof, as set forth in Exhibit B. In the event of any conflict between the terms of the TIF Note and the terms of this Article VI, the terms of the TIF Note shall govern. The issuance of the TIF Note pursuant and subject to the terms of this Agreement, and the taking by the City of such additional actions as bond counsel for the TIF Note may require in connection therewith, are hereby authorized and approved by the City. Section 6.8 Developer's Prepayment of Loan No. 2. If Developer prepays Loan No. 2 in full, the City will, prior to the issuance of the TIF Note, revise the TIF Note so that the first TIF Note Payment Date is the first February 1 or August 1 following Developer's payment of Note No. 2 in full and to make the TIF Note payable from Tax Increments the City receives on or after the date Developer has repaid Loan No. 2 in full. 2695614v12 ARTICLE VII LOAN NO. 1 Section 7.1 Loan No. 1. To assist Developer with the construction of the Housing Development Project, the HRA proposes to make a $1,420,000.00 loan to Developer pursuant to the terms of the Loan Agreement and Note No. 1. The HRA proposes to fund Loan No. 1 with tax increments the City has collected from the City's Tax Increment District No. 1, which the City will make available to the HRA. Section 7.2 Loan Agreement, Note No. 1 and Corporate Guaranty. Contemporaneous with the HRA's conveyance of the Development Property to Developer: the HRA and Developer must each execute the Loan Agreement and must each deliver an original, executed Loan Agreement to the other party; Developer must execute Note No. 1 and deliver Note No. 1 to the HRA; and Developer must cause the Corporate Guarantor to execute the Corporate Guaranty and deliver the Corporate Guaranty to the HRA. In the event of a conflict between the terms of Note No. 1 and the terms of this Development Agreement, the terms of Note No. 1 control. In the event of a conflict between the terms of this Agreement and the terms of the Loan Agreement, the terms of the Loan Agreement control. Section 7.3 Fee in Lieu of Interest and Default Interest Rate. Note No. 1 does not obligate Developer to pay interest on the outstanding principal of Loan No. 1 provided Developer is not in default in the timely payment of any amounts due under Note No. 1. In lieu of non- default interest and as consideration for the extension of credit, the HRA will charge Developer and Developer agrees to pay a one -time fee of $120,000.00. As set forth in the Loan 12