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16 419290v2 LN140 -109 rates and tax rates in effect in the tax -payable year of the casualty, and assuming a discount rate of 4%; all a s reasonably estimated by the EDA’s financial advisor. 17 .6. Property Tax Covenant . (a) After closing on the Property, and u ntil the Maturity Date the Developer agr ees for itself, its successors and assigns, in addition to the obligation pursuant to statute to pay real estate taxes, that it is also obligated by reason of this Agreement to pay before delinquency all real estate taxes assessed against the Property. Th e Developer acknowledges that this obligation creates a contractual right on behalf of the EDA to sue the Developer or its successors and assigns to collect delinquent real estate taxes and any penalty or interest thereon and to pay over the same as a tax payment to the county auditor. In any such suit, the EDA shall also be entitled to recover its costs, expenses and reasonable attorney fees. (b ) The Developer agrees that through the Maturity Date, it will not cause a reduction in the real property tax es paid in respect of the Property by (1) apply ing for a deferral or abatement of property tax on the Property pursuant to any law; or (2 ) convey ing or transferring or allow ing conveyance or transfer of the Property to any entity that is exempt from paymen t of real property taxes under State law except as otherwise provided in this paragraph , or (3) without conveying the Property, operating the Minimum Improvements in a fashion that makes them exempt from real property taxes under State law except as otherw ise provided in this paragraph. As an exception to clause s (2 ) and (3) of this paragraph, Developer may transfer the Property to an entity that is exempt from payment of real property taxes under State law if , or operate the Minimum Improvements in fashio n that makes them exempt from real property taxes under State law if : (i) the EDA approves the t ransfer ; and (ii) the transferee executes an agreement with the City under which the transferee pays to the City, at the time real estate taxes are otherwise pa yable, a payment in lieu of taxes (the “PILOT Agreement”). The PILOT Agreement must have a term of at least 30 years. Prior to the Maturity Date, the annual payment under the PILOT Agreement must be an amount equal to the total t ax i ncrement that would b e payable to the City if the property were subject to ad valorem taxes, plus the City’s share of taxes on the original net tax capacity (as defined in Minnesota Statutes, Section 469.174, subd. 7 ) of the Property. After the Maturity Date, the annual payme nt under the PILOT Agreement must be the City’s share of taxes on the Property. (Remainder of this page intentionally left blank)