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HomeMy WebLinkAbout26-004 - EDA Resolution - TIF Note LyngblomstenLINO LAKES ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. 26-04 RESOLUTION APPROVING COLLATERAL ASSIGNMENT AND SUBORDINATION OF CONTRACT FOR PRIVATE DEVELOPMENT AND TIF NOTE WITH LYNGBLOMSTEN AT LINO LAKES, LLC AND OLD NATIONAL BANK BE IT RESOLVED By the Board of Commissioners (the "Board") of the Lino Lakes Economic Development Authority (the "Authority") as follows: Section 1. Background. 1.01. The City of Lino Lakes (the "City") and the Lino Lakes Economic Development Authority (the "Authority") previously approved the creation of Tax Increment Financing (Housing) District No. 1-5 and Tax Increment Financing (Housing) District No. 1-13 (the "TIF District") within Development District No. 1 in the City, all in accordance with Minnesota Statutes, Sections 469.174 through 469.1794, as amended (the "TIF Act"). 1.02. The Authority and Lyngblomsten at Lino Lakes, LLC, a Minnesota limited liability company (the "Developer"), entered into an Amended and Restated Contract for Private Development, dated September 7, 2021 (the "Agreement"), pursuant to which the Developer agreed to construct a senior rental housing facility with approximately 167 units, comprised of (i) approximately 96 independent living apartments, 35 assisted living units, and 16 assisted memory care units, with at least twenty percent (20%) of such units to be available to persons of low and moderate income; and (ii) 20 detached independent living townhomes upon a portion of the property in the TIF District (collectively, the "Minimum Improvements"). 1.03. To make the Minimum Improvements financially feasible, the Authority issued its Tax Increment Revenue Note, Series 2021 (the "TIF Note"), dated October 11, 2021, in the principal amount of $3,565,000, to the Developer to reimburse the Developer for qualified development costs described in the Agreement. 1.04. The City of Bethel, Minnesota issued its Senior Housing Revenue Note (Lyngblomsten at Lino Lakes Project), Series 2021 (the "Series 2021 Note"), dated October 5, 2021, in the original aggregate principal amount of $42,700,000, and loaned the proceeds thereof to the Developer to finance a portion of the costs of the Minimum Improvements. 1.05. The Developer has determined to refinance the Minimum Improvements through the refinancing of the Series 2021 Note and taxable debt incurred by the Developer provided to the Developer in connection with the construction of the Minimum Improvements. To that end, the Developer has requested that the City issue one or more series of tax-exempt or taxable obligations (the "Note") in the estimated principal amount not to exceed $60,000,000 and loan the proceeds thereof (the "Loan") to the Developer pursuant to a Loan Agreement between the City and the Developer. Old National Bank, a national banking association (the "Purchaser"), has agreed to purchase the Note from the City in accordance with a Continuing Covenant Agreement between the Developer and the 4929-3577-3122.2 Purchaser. 1.06. As security for the repayment obligations of the Developer with respect to the Loan, the Purchaser has required that the Developer execute and deliver security instruments, including but not limited to a Collateral Assignment and Subordination of Contract for Private Development and TIF Note (the "Collateral Assignment") between the Developer, the Purchaser, and the Authority. 1.07. There has been presented before the Board a form of the Collateral Assignment, pursuant to which the Developer and the Authority will agree to assign the Developer's interests in the Agreement and the TIF Note to the Purchaser and subordinate certain provisions of the Agreement to the Loan. Section 2. Approvals. 2.01. The Authority hereby approves the Collateral Assignment in substantially the form delivered to the Authority and on file with the Executive Director and all other documents referenced in or attached to the Collateral Assignment (collectively, the "Assignment Documents"), and the President and the Executive Director are hereby authorized and directed to execute the Assignment Documents for and on behalf of the Authority in substantially the forms now on file with the Authority but with such modifications as shall be deemed necessary, desirable or appropriate, the execution thereof to constitute conclusive evidence of their approval of any and all modifications therein. 2.02. The approval hereby given to the Assignment Documents includes approval of such additional details, modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the Authority and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the Authority. The execution of any instrument by the appropriate officers of the Authority herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. In the event of absence or disability of either of such officers, any of the documents authorized by this resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by such other officer or officers of the Board as, in the opinion of the Authority's attorney, may act on his or her behalf. 2.03. The President and the Executive Director are hereby authorized and directed to execute any and all other documents deemed necessary to carry out the intentions of this resolution. Section 3. Effective Date. This resolution shall be in full force and effect from and after its approval. (The remainder of this page is intentionally left blank.) 2 4929-3577-3122.2 The motion for the adoption of the foregoing resolution was introduced by Commissioner "Cl Pv\ and was duly seconded by Commissioner NQ\SDn and upon the vote being taken thereon, the following voted in favor thereof: The following voted against the same: Adopted by the Board of Commissioners of the Lino Lakes Economic Development Authority this 24tn day of August, 2026. ATTEST: W �L- Karen Anderson, Executive Director 3 Randy Rennake , vice President 4929-3577-3122.2