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Mounds View EDA May 10, 2004 Regular Meeting Page 2 Coordinator Backman indicated that Staff recommends that the termination be contingent upon the sale actually occurring. He then indicated that Staff recommends that Section 7.2 of the agreement that already exists and was already agreed to remain and it is the indemnification for the City that is to survive termination. Coordinator Backman indicated that the issue of whether or not the City is to make the developer payment in August 2004 arose today. He then said that he consulted the City’s TIF attorney and they are of the opinion that, if the building is sold and the note terminated, the City is not obligated to make the payment. MOTION/SECOND: Gunn/Quick. To Approve Resolution 04-EDA-185 Approving the Termination of the Development Agreement between the Mounds View EDA And Michel Investments Entered Into April 26, 1999 and Cancellation of the Tax Increment Revenue Note for the Building N Project. Vice President Stigney indicated that he does not agree with what is happening and will not vote for this. Vice President Stigney indicated that he is concerned about the position this puts the City in. Vice President Stigney asked whether wording could be added to require that the sale close prior to August 1, 2004. Coordinator Backman indicated that if the closing occurs after the August 1, 2004 date there is an argument that could be made that the City is to make the payment. City Administrator Ulrich indicated that, as long as this does not close, the TIF agreement remains in effect and the City makes the payments. Commissioner Marty asked what the amount of the payment is. Coordinator Backman indicated the payment amount is approximately $24,000. John Ryden from CB Ellis addressed the Authority and indicated that their request had been to be completely released from the agreement. Coordinator Backman indicated that there is already an indemnification clause in the document that survives termination and that was previously agreed to. He then said that it applies only to the time during which the building is owned by Michael Investments. Commissioner Quick asked whether the motion included the suggested amendments.