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By executing the Assistance Agreement the City is agreeing to issue the <br /> TIF Bonds to provide the assistance to the development. The City is not obligated to <br /> issue the bonds until certain conditions are satisfied. These conditions include the <br /> execution and delivery of the Redevelopment Agreement and Assessment <br /> Agreement by SUPERVALU, the purchase of the CUB Foods site by SUPERVALU <br /> and the execution and delivery of the Shortfall Agreement by.First Bank. Once <br /> these conditions are satisfied the City is obligated to proceed promptly'to issue the <br /> bonds and pay the assistance to Ste. Marie Company. This puts the City at some <br /> market rate risk should interest rates rise. However, I do not see this as a problem <br /> since rates are stable at the present time and the City should be able to lock in the <br /> interest rates on the bonds in a relatively short period of time (30-45 days) once the <br /> conditions are satisfied. <br /> JPG:cmn <br /> -2- <br /> DORSEY & WHITNEY LLP. <br />