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December 6, 2011 <br />Mr. Jason Zellers, Vice President, General Counsel & Corporate Secretary <br />St. Jude Medical, Inc. <br />1 Lillihei Plaza <br />Little Canada, MN 55117 <br />Re: Reimbursement of Shortfall Costs Per Development Agreement <br />Dear Mr. Zellers: <br />Pursuant to Section 3.2 of Development Agreement (text below) with St. Jude Medical, Inc. <br />executed by Mr. Heinmiller on your company's behalf on May 30, 2008,1 am submitting an <br />invoice to you totaling $558,691.63. This invoice is itemized based upon the four phases of <br />public improvements as outlined in our development agreement. Upon receipt of payment, we <br />will issue St. Jude Medical, Inc a tax increment shortfall note in the amount of $530,237.23 <br />($558,691.63 less $28,454.40 for private water main costs noted below). This note will then be <br />repaid from future tax increments to the extent they are available and after the payment of debt <br />service costs. <br />Section 3.2 Reimbursement: Tax Increment Revenue Note. After paying and /or <br />incurring the costs for completing the Phase I Public Improvements and the Phase II Public <br />Improvements and the City is ready to commence the Phase III Public Improvements, if the City <br />determines that there remains insufficient proceeds of the Bonds to complete all of the Phase III <br />Public Improvements, it shall so notify Developer of the amount of the insufficiency (the "Phase <br />111 Shortfall ") by providing an itemization of the costs for all of the Public Improvements <br />(broken down for each phase) and the amount of the Bond proceeds. The Developer shall deposit <br />with the City funds in an amount equal to the lesser of (a) the amount of the Phase III Shortfall or <br />(b) $650,000, (the "Phase 11I Deposit Amount ") within 30 days of receipt of such itemization <br />of the costs for the Public Improvements and the City shall hold such amount in a separate <br />account to be disbursed only to pay the costs of the Phase III Public Improvements (the "Phase <br />III Deposit Account "). The City shall repay the Developer for the amount of the Phase III <br />Shortfall through the issuance of the City's Phase III Shortfall Note in substantially the. .fhrm <br />attached to this Agreement as Exhibit E, subject to the following conditions: <br />For your information, the cost breakdown by phase is as follows: <br />Phase I — Water /Sewer $785,362.05 <br />Phase 11-- Landscaping $24,403.87 <br />Phase 11I _. Aquisitions /Landscaping /Watermain $1,387,713.30 <br />Phase IV — Construction of I32 Turn Lanes $0.00 <br />TOTALS 82,197,479.22 <br />9 <br />