Resolution - #12-04-054 - 04/24/2012

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be maintained in the manner herein specified until all of the Bonds and the interest thereon have been fully paid. There shall be maintained in the Fund the following separate accounts: (a) Capital Account. To the Capital Account there shall be credited the proceeds of the sale of the Bonds, less capitalized interest in the amount of $385,578.67 (together with interest earnings thereon and subject to such other adjustments as are appropriate to provide sufficient funds to pay interest due on the Bonds on or before December 1, 2014). The City shall transfer funds from the Capital Account to the Authority in such amounts and at such times so that the Authority can advance Loan No. 2 proceeds to the Borrower as required by Article VIII of the Development Agreement. Moneys in the Capital Account shall be used for no other purpose except as otherwise provided by law; provided that the proceeds of the Bonds may also be used to the extent necessary to pay interest on the Bonds due prior to the receipt of Tax Increments. (b) Debt Service Account. To the Debt Service Account there is hereby pledged and irrevocably appropriated and there shall be credited: (i) Tax Increments not otherwise pledged and applied to the payment of other obligations of the City, in an amount sufficient, together with other sums herein pledged, to pay the annual principal and interest payments on the Bonds; (ii) all accrued interest received upon delivery of the Bonds; (iii) capitalized interest in the amount of $385,578.67 (together with interest earnings thereon and subject to such other adjustments as are appropriate to provide sufficient funds to pay interest due on the Bonds on or before December 1, 2014); (iv) all payments made by the Borrower to the Authority pursuant to Note No. 2 and all payments received by the Authority pursuant to the Personal Guraranty and remitted to the City pursuant to the Pledge Agreement; (v) all funds remaining in the Capital Account after completion of the Project and payment of the costs thereof; (vi) all investment earnings on funds held in the Debt Service Account; and (vii) any and all other moneys which are properly available and are appropriated by the governing body of the City to the Debt Service Account. The Debt Service Account shall be used solely to pay the principal and interest and any premiums for redemption of the Bonds and any other general obligation bonds of the City hereafter issued by the City and made payable from said account as provided by law. 16. Original Net Tax Capacity; Tax Increments; Use of Tax Increments. The County Auditor of Anoka County has certified the original net tax capacity of property in the Tax Increment District. The County Auditor shall determine in each year if the then current net tax capacity of property in the Tax Increment District exceeds the original net tax capacity, and shall calculate, in the manner provided in Minnesota Statutes, Section 469.177, Subdivision 3, the captured net tax capacity (as defined therein) attributable to the Tax Increment District. The City hereby determines to retain 100% of the captured tax capacity for purposes of Tax Increment. The County Auditor shall, in each such year, compute the local tax rate to be extended against the captured net tax capacity in the manner provided in Minnesota Statutes, Section 469.177, Subdivision 3, and the tax generated thereby shall constitute the Tax Increments for the year in which it is received. The County Auditor will remit to the City the Tax Increments so received. The City hereby appropriates the Tax Increments to the Debt Service Account, which appropriation shall continue until all of the Bonds and any additional bonds payable from the Debt Service Account, are paid or discharged. 4590579v1 16