HomeMy WebLinkAboutResolution No. 18-01 EDA LINO LAKES ECONOMIC DEVELOPMENT AUTHORITY,MINNESOTA
RESOLUTION NO.18-01
RESOLUTION APPROVING COLLATERAL ASSIGNMENT AND SUBORDINATION OF
DEVELOPMENT AGREEMENT AND TAX INCREMENT REVENUE NOTE.
WHEREAS, the City of Lino Lakes, Minnesota (the "City") and the Lino Lakes Economic
Development Authority (the "Authority") have established, and the Authority administers, Development
District No. 1 (the "Development District") located within the City and have caused to be created a
Development Plan therefor, pursuant to Minnesota Statutes, Sections 469.090 through 469.1082, as
amended; and
WHEREAS, within the Development District the City and the Authority have created Tax
Increment Financing(Economic Development)District No. 1-12(the"TIF District"),pursuant to Minnesota
Statutes, Sections 469.174 through 469.1794,as amended;and
WHEREAS, the Authority, United Properties Development LLC, a Minnesota limited liability
company (the "Developer"), and Distribution Alternatives, Inc., a Minnesota corporation (the "Tenant"),
have entered into a Contract for Private Development, dated July 25, 2016 (the "Contract"), pursuant to
which the Developer agreed to develop an approximately 400,000 square foot warehouse and distribution
facility with related office space and other improvements to be constructed on property located within the
TIF District for use by the Tenant in its distribution business (the "Minimum Improvements"), and in turn
the Authority agreed to reimburse the Developer for certain public improvements and site preparation costs;
and
WHEREAS, the Authority issued to the Developer its Tax Increment Revenue Note, Series 2017
(the "TIF Note"), in the original aggregate principal amount of$1,200,000, to reimburse the Assignor for
the public improvements and site preparation costs as provided in the Contract;and
WHEREAS, the Developer conveyed the Minimum Improvements and the property on which the
Minimum Improvements are located to AX Lino Lakes L.P., a Delaware limited partnership(the"Owner"),
and also assigned its interest,rights,and obligations under the Contract and the TIF Note to the Owner;and
WHEREAS, Bank of America, N.A., a national banking association (the "Lender"), has agreed to
provide a loan to the Owner in the maximum principal amount of $16,110,000 (the Lender Loan") to
finance a portion of the costs of the Minimum Improvements;and
WHEREAS, as a condition to providing the Lender Loan to the Owner, the Lender requires that
the Owner assign all of its rights under the Contract and the TIF Note to the Lender, that the Authority
agree to the collateral assignment of the Owner's rights under the Contract and the TIF Note, and that the
Authority agree to subordinate its rights under the Contract to the rights of the Lender under the loan
documents to be executed in connection with the Lender Loan (collectively, the "Lender Loan
Documents"); and
WHEREAS, there has been presented to the Board of Commissioners of the Authority a form of
Collateral Assignment of and Subordination of Development Agreement and Tax Increment Revenue
Note (the "Collateral Assignment"), proposed to be entered into between the Owner, the Lender, and the
Authority, which sets forth the terms of the collateral assignment of the Owner's rights under the
Contract and the TIF Note, the Authority's approval of such assignment, and the Authority's
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subordination of its rights under the Contract to the rights of the Lender under the Lender Loan
Documents; and
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Lino Lakes
Economic Development Authority that:
1. The President and the Executive Director are hereby authorized to execute and deliver
the Collateral Assignment in substantially the form on file with the Authority, with such additions,
deletions, and other changes as are approved by the President and the Executive Director. The President
and the Executive Director are further directed to execute any additional documents or take all steps and
do all things necessary to effectuate the provisions of the Collateral Assignment.
Approved by the Board of Commissioners of the Lino Lakes Economic Development Authority this
12''day of February,2018.
Pres' en
ATTEST:
Ex uti Director
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