HomeMy WebLinkAbout04/09/15 EDA Meeting
Meeting Location: Municipal Center
7100 147th Street West
City of
Apple Valley, Minnesota 55124
NOTICE: The Apple Valley Economic Development Authority will hold a special
meeting at the Municipal Center, on Thursday, April 9, 2015, at 7:00 p.m.
to consider the items listed in the following agenda:
APRIL 9, 2015
ECONOMIC DEVELOPMENT AUTHORITY SPECIAL MEETING
TENTATIVE AGENDA
7:00 p.m.
(immediately following the City Council meeting)
1. Call to Order.
2. Approval of Agenda.
3. Approval of Minutes of March 26, 2015.
4. Approval of Consent Agenda Items*:
*A. Approve and Authorize Partial Release of Easements Located on
Lot 2, Block 1, Carroll Center 4th Addition (Carmike Property) for Cedar Ave Road
Construction Project.
5. Regular Agenda Items:
A. Uponor Annex Expansion:
1. Economic Development Tax Increment Financing District.
a. Hold Public Hearing for Modifications to the Master Development District.
b. Resolution Approving Amendments to Master Development Program, Tax Increment
Financing (TIF) Amendments, and the Establishment of TIF District No. 16, and
Approving the Tax Increment Financing Plan and Business Subsidy.
2. Deferred Loan Business Assistance as Public Business Subsidy.
a. Hold Public Hearing.
b. Resolution Approving a Business Subsidy Agreement between the Apple Valley
Economic Development Authority and Uponor, Inc.
6. Other
7. Staff Updates.
8. Adjourn.
* Items marked with an asterisk (*) are considered routine and will be enacted with a
single motion, without discussion, unless a commissioner or citizen requests the item
separately considered in its normal sequence on the agenda
(Agendas are a
ECONOMIC DEVELOPMENT AUTHORITY
City of Apple Valley
Dakota County, Minnesota
March 26, 2015
Minutes of the meeting of the Economic Development Authority of Apple Valley, Dakota County,
Minnesota, held March 26, 2015, at 6:00 p.m., at Apple Valley Municipal Center.
PRESENT: Commissioners Bergman, Grendahl, Hamann-Roland, Hooppaw, Maguire and
Melander.
ABSENT: Commissioner Goodwin
City staff members present were: Executive Director Tom Lawell, City Attorney Michael
Dougherty, Community Development Director Bruce Nordquist, Finance Director Ron Hedberg,
Planner Margaret Dykes and Department Assistant Joan Murphy.
Meeting was called to order at 6:00 p.m. by Vice-President Melander.
APPROVAL OF AGENDA
MOTION: of Hamann-Roland, seconded by Hooppaw, approving the agenda. Ayes - 6 - Nays
- 0.
APPROVAL OF MINUTES
MOTION: of Hooppaw, seconded by Bergman, approving the minutes of the meeting of
February 26, 2015, as written. Ayes - 6 - Nays — 0.
CONSENT AGENDA
TRANSFER OF OWNERSHIP OF SPOWD DEVELOPMENT TO AVBC, LLC
MOTION: of Hamann-Roland, seconded by Bergman, approving dedication of Drainage and
Utility easement over portions of Outlot C, Valley Business Park. Ayes - 6 - Nays
— 0.
MOTION: of Hamann-Roland, seconded by Bergman, authorizing staff to prepare agreements
between the Apple Valley EDA and OneTwoOne Development, LLC for the
Iv Tillage 'Pointe Plaza mixed-use development (Lot 1, Plock N at Founders
Circle). Ayes - 6 - Nays — 0.
Finance Director Ron Hedberg stated that in June 2012, the EDA entered into a development
agreement with Spowd Developments, LLC for the development of the Apple Valley Business
Campus located in TIF District No.14 along the newly constructed 147th Street W. The
development agreement provided for the development of 21 acres, comprised of two separate
phases including four buildings, totaling 228,928 square feet of office/ show room/ warehouse
with a market value of $11.3 million. Spowd Developments, LLC is requesting a transfer of the
development agreement to a new company, AVBC, LLC.
Economic Development Authority
City of Apple Valley
Dakota County, Minnesota
March 26, 2015
Page 2
He commented that the developer obligations included, building a minimum of two buildings,
employing at least 40 people and maintaining the property as a rental commercial building during
the term of the TIF District. The developer has met all the requirements except for maintaining
the property as an ongoing rental commercial property over the life of the TIF district, which is a
function of time.
The development agreement includes a pay as you go TIF district, with the costs incurred secured
by the property in the form of a special assessment levied against the property. The agreement
included a Tax Increment Revenue Note which is the instrument that provides the pay as you go
financing feature whereby the developer will receive 90% of available tax increment revenue each
year.
The original Tax Increment Revenue Note was executed with Spowd Developments, Inc. and
Spowd is requesting that the rights and responsibilities included be transferred to a new entity,
AVBC, LLC. AVBC, LLC is owned by Spowd Developments.
Discussion followed.
MOTION: of Bergman, seconded by Hooppaw, adopting Resolution No. EDA-05 approving
and authorizing the execution of assignment of Development Agreement for
transfer of ownership from SPOWD Developments to AVBC, LLC. Ayes - 6 -
Nays — 0.
6. OTHER
NONE
7. STAFF UPDATES
Community Development Director Bruce Nordquist informed the Commission that a presentation
for Vitalocity would take place on April 15, 2015, at 7:00 p.m. and that the City Commissions and
Committees are invited.
ADJOURNMENT
MOTION: of Hamann-Roland, seconded by Grendahl, to adjourn. Ayes - 6 - Nays - 0.
The meeting was adjourned at 6:15 p.m.
Respectfully Submitted,
Murphy, Departme t Assi ant
Approved by the Apple Valley Economic Development Authority on
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city of App e
Val ey
Budget Impact
None
Attachment(s)
ITEM:
ECONOMIC DEVELOPMENT
MEETING DATE:
SECTION:
April 9, 2015
Consent
ITEM DESCRIPTION:
Consideration partial release of signage and access easement adjacent to Cedar Avenue in connection
with the Cedar Avenue improvement project for Carmike Theater property, 15630 Cedar Avenue.
STAFF CONTACT:
Kathy Bodmer, Planner
DEPARTMENT/DIVISION:
Community Development Department
Action Requested
• Approve Partial Release of Signage and Access Easement on the western fifteen feet (15') of
Lot 2, Block 1, CARROLL CENTER 4 ADDITION (Carmike Theater property) and
authorizing President and Secretary to sign the same.
Summary
Dakota County is completing its process for obtaining the western fifteen feet (15') of Lot 2, Block 1,
CARROLL CENTER 4 ADDITION the Carmike Theater property) for a trail, drainage and utility
easement, in connection with the Cedar Avenue improvement project. The Apple Valley EDA holds
easements in this area, so Dakota County is requesting that the EDA approve the attached Partial
Release of Signage and Access Easement on the western 15' of the property. This partial release of
easement will assist Dakota County in completing its work with the property owner.
The Apple Valley EDA obtained sightline, signage, sign access and cross parking easements in 1997 in
conjunction with the approval of the CARROLL CENTER 4 ADDITION development. The
easements were obtained to ensure sightlines would be maintained from Cedar Avenue to the EDA-
owned transit station building at 155 Street and Gaslight Drive (former transit station). The sightline
easement will remain in effect and will not be affected by this easement release.
• Location Map
• Easement Exhibit
• Draft Partial Release of Easement
• Title Search Report Excerpt for Dakota County
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CARROLL CENTER
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LOCATION MAP
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WHEREAS, Dakota County, through County Project 23 -59, reconstructed Cedar Avenue in
Apple Valley to create a Bus Rapid Transit (BRT) corridor along County State Aid Highway
(CSAH) 23 (the "Project "); and
WHEREAS, in connection with the Project, Dakota County :condemned for highway
purposes 9,870 square feet of permanent trail, drainage and utility easement over portions of the
following described property:
Lot 2, Block 1, CARROLL CENTER 4TH ADDITION, according to the plat on file and of
record in the Dakota County Recorder's Office.
(the "Property ") (the Carmike Theater located at "l 5530 Cedar Avenue).
WHEREAS, the Apple Valley Economic Development Authority ( "EDA'') has the following
interest in the Property:
(the "EDA Easements ").
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. EDA -15-
A RESOLUTION AUTHORIZING THE EXECUTION OF A
DISCLAIMER OF INTEREST
1. Signage and Access Easement, dated December 23, 1997, recorded February 9, 1998 as
Doc. No 1475682.
WHEREAS, Dakota County, in connection with the Project, has requested the EDA execute
a Partial Release of Signage and Access Easement for the portion of the EDA Easements described
as:
The westerly 15 feet of Lot 2, Mock 1, CARROLL CENTER 4TH ADDITION, according to
the plat on file and of record in the Dakota County Recorder's Office.
to complete a settlement with the Property owner, AP Apple Valley Limited Partnership and to
dismiss the EIDA and other parties from the Condemnation Proceeding.
NOW, THEREFORE, BE IT ��C�IT �T��'1 1,�� the nnr��,- ,AY, -,�. �� of a Y,r, Valley
1V VV , I l E E , E 1 i R S()t V ETI, b he 3oa dmen Vets; o1 the 11ppie Valley
Economic Development Authority, that the EDA President is hereby authorized to sign the
Disclaimer of Interest.
ADOPTED this 9th day of April, 2015.
Thomas C. Goodwin, President
ATTEST:
Pamela J. Gackstetter, Secretary
By: Tom Goodwin
Its: President
PARTIAL RELEASE OF SIGNAGE AND ACCESS EASEMENT
Date: April 9, 2015
The real property in Dakota County, Minnesota, legally described as follows:
The westerly fifteen feet of Lot 2, Block 1, Carroll Center Fourth Addition, according to
the recorded plat thereof
is hereby released from the Signage and Access Easement dated December 23, 1997, and
recorded on February 9, 1998, as Document Number 1475682 in the Office of the Dakota
County Recorder.
APPLE vALLEY ECONOMIC DEVELOPMENT
AUTTIORITY, a public body corporate and p olitic
and a political subdivision of the State of Minnesota
By: Pamela J. Gackstetter
Its: Secretary
1
STATE OF MINNESOTA )
) ss.
COUNTY OF DAKOTA )
On this day of 2015, before me a Notary Public within and for
said County, personally appeared Tom Goodwin and Pamela J. Gackstetter to me personally
known, who being each by me duly sworn, each did say that they are respectively the President
and Secretary of the Apple Valley Economic Development Authority, a public body corporate
and politic and a political subdivision of the State of Minnesota, and said President and Secretary
acknowledged said instrument to be the free act and deed of said Apple Valley Economic
Development Authority.
This instrument was drafted by:
Dougherty, Molenda, Solfest, Hills & Bauer P.A.
14985 Glazier Avenue, Suite 525
Apple Valley, Minnesota 55124
(952) 432-3136
MDK (66-27695)
Notary Public
2
im
COUNTY PRQ.JECT NOS. 23-59 AND 23,64 AND 2340
State of Mintiesota,)
:ss.
County of Dakota,)
DCA Title does hereby certify that there has been nothing filed affecting the title to the irids
described as follows, to-wit:
Lot 2 Block 1 Car Center Fourth Additic:iri
from the 20th day of February, A.D., 2007 at 8 o'clock A.M., to date, as the same appears
from the abstract books 2nd the real estate and land records of the office of the County
Recorder of Dakota County, Minnesota.
We further certify that any certification as to Townhouses includes a search as to Mechanic's
Liens affecting the Common Area thereof.
NOTE: None of the searches made in the following paragraph include any names having middle
initials different from those shown therein,
We further certify that there are no unreleased Federal Tax Liens, no unreleased State Tax
Liens, no Unreleased County Tax Liens, no bankruptcy proceedings initiated, and no unsatsfied
Federal Judgments on file in the said County Recorder's Office and that there are no unsatisfied
Judgments docketed in the Office of the Clerk of the District our or County Court of Dakota
County a.gainst any of the folic:- ing:
Parcel No 0116253-02001
PARCEL 12
AP Apple Valley Limited Partnership.
Dated at Hastings, Minriesota this 15th day of March, A., D., 2010
at 8 o'clock A.M,
DCA Title,
MEMBER AMERICAN LAND TIME ASSOCIATION
and
MINNESOTA LAND TITLE ASSOCIATION
An Authorked Signature,
This Abstract of it is a history of the record title of the property described th rein and does
_not repreient that tile title is good and niarketable.
Order No. A10-59321
92
IAGE oFid RA.GEs
s I QN
EA.S
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ACCESS
NT DESCRIPTIONS
EA.sEMENT OR SIGN ZNSTALIATION AND MA.IIITENANcE:
NT
. .
A parcel of land forty-fur feet (41') by forti-eight feet (46') in siz e lying
oveX that southwesterly part of Lot 1, Block 1, and that northwesterly part of Lot
2, Block 1, both of Carroll Center FolirthMdition, Dakota County, Minaesota,
described as follow: ' •
Commencing at the soutbweste.r.ly corner of Lot L, Block 1,
Carroll,- Center rourth Addition, on file and of. record at the
Recorder'a Office, Dakota Couoty, Minnesota; thence due North
along the west line of said lot a distance ot 1Q.00 feet;
thence Nartb as degrees 49 minutes 4G seconds Eat, pasallel
with the South line of said Lot, a distance. of 48.00 feet;
thence due South, parallel with the Nest line of 5aid lot, a
distance of 10.00 to the south llnefot said lot; thence
South 09 degrees 4,3 minutes 46 seconds West along the Aouth
line of said lot a distance of 4.6.010 feet to the - point of
beginning at the southwa,st corner of said lot and there
terminating; and
Conmenoing at the noithwesterLy cornat trf :Lot 2, Block 1,
Carroll Center Fourth AAdition; On fila and of record at the
Reoordur's Office, Dakota County, Ninnesota; thence due South
along the A0.1-15t. Line of said 1ot a distancz of 34.00 fey
thence North 59 deg. .49 minutes 46 seconds East, parallel
with the north line bt', said lot, a distance of 4E1.00 "feet;
then a due North, parallel with the west line of said lot, 8
distance of 34.00 feet to the north line of said iotl' .thence
South E degrees 49 minutes 46 secand West along the north
line of said lot a distance of 43 .00 feet: to pclint, of
beginning at the northwest corner of said Lot and there
terminat4.ng-
EASTMENT FOR SIGN ACCEsS, AND UTILXTYERVICI
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Jak strip of land fifteen feet (15') in width over, that northerly part of .Lot 2,
Block 2, Carroll . Cente'r Fourth AAdition, Dakota Couuty, Minnesota, lying seven and
one halt feet (7 )/2') on either side of the follmang described line:
Beginning at the northwesterly cax'ner of Lot 2, Block 2,
Carroll Center Fourth Addition, ou file and of record at the
Recorder's Office, Da}Dta County, Minnesota; thence 'due South
along the westaine of said lot a di5tance o 12.00 at tb'th6
poinh of L)Iginning of the Line to be described/ thence North 89
degrees 49 minutes 46_seconds East, parallel with the north.
line of said lot, a distance' of 340.011 1W€t line of
,9aid lot and there,terminatinu.
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Maximum height of sign above grade:
Maximum area of sign:
" PAGE /0 O i PAGEs
1BIT D
MONUIVIENT/PYtON SIGN
Twe.nty-four fEet. (24')
One hundred ten scuare feet (110 fr
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City of App e 1 ,
Valle
TO: President, Economic Development Authority Commissioners, and
Tom Lawell, Executive Director
FROM: Ron Hedberg, Finance Director
MEMO
Finance Department
DATE: April 4, 2015
SUBJECT: Conduct Public Hearing to Consider Amendments to the Master Development
District to include TIF District 16
Adopt Resolution Approving Amendments to Master Development Program, the
Establishment of Tax Increment Financing District No. 16 and Approving the Tax
Increment Financing Plan Therefor and Approving Business Subsidy
Introduction
A public hearing has been scheduled for April 9, 2015 to consider a modification to the Master
Development Program and the establishment of Tax Increment Financing District No. 16 to address
a new project and the provision of a business subsidy. Prior to the establishment of any new Tax
Increment Financing (TIF) it is necessary to amend the Master Development District to include
the TIF plan for the new district.
The City and EDA have received a request for financial assistance from Uponor NA Asset
Leasing Inc. to assist in the expansion of their annex facility located at 148 St and Everest
Avenue near the current company headquarters. One of the pieces of the assistance being considered
is in the form of a pay as you go Economic Development TIF District. In addition to this TIF
assistance an additional development expansion grant as a business subsidy that will be considered
by the Economic Development Authority on their April 9, 2015 agenda.
In a pay as you go TIF District the property owner privately finances and documents eligible TIF
costs for the project and the increase in the property value as a result of the project is captured and a
portion of the taxes paid are returned to the property owner in the form of assistance. The risk in this
type of district remains with the property owner and if the actual taxes generated are lower than
projections the owner will receive less assistance. An Economic Development TIF District has a life
of 8 years from the date of the first TIF receipt.
Discussion:
The project includes the renovation and expansion of Uponor's existing 36,000 square annex facility
to create an approximately 86,000 square foot office and manufacturing facility consisting of
approximately 6,000 square feet of office space and approximately 80,000 square feet of
manufacturing space.
The total development costs are estimated to be $12,300,000 on the site. The assistance request is to
offset a portion of the development cost.
Economic Development Authority
Establishment of TIF No. 16
April 4, 2015
Page 2
The TIF plan was based on the assumption that the increase in taxable value was to be $6,600,000
and the TIF plan includes estimated TIF collections of $1,215,000. Preliminary indications from the
Dakota County Assessor are that the increase in property value is will be $3,000,000 and the total
TIF generated would be approximately $560,000, resulting in available tax increment returned to the
property owner of $504,000 in the form of a pay as you go TIF Note. The TIF note would cap the
amount that would be returned to the owner at the $504,000. If the resulting values are higher and
the TIF collections are then higher the $504,000 would be repaid quicker and the district is required
to be retired.
Estimated Project/Financing Costs
(to be paid or financed with tax increment)
Project costs
Land/building acquisition
Site improvements/preparation costs
Other qualifying improvements
Administrative costs
Estimated Tax Increment Project Costs
Estimated financing costs
Interest expense
Estimated Financing
Total amount of bonds to be issued
Note: Figures have been rounded
Projected Tax Increment
City of Apple Valley, Minnesota
Tax Increment Financing District No. 16
Estimated Tax Increment Revenues
(from tax increment generated by the district)
Tax increment revenues distributed from the county $ 560,000 $1,215,000
Interest and investment earnings $0
Sales/lease proceeds $0
Total Estimated Tax Increment Revenues $ 560,000 $1,215,000
Total Estimated Project/Financing Costs to be Paid from Tax
Increment
Anticipated per
County Prelim
Estimate of Total
Value (Per TIF Plan)
$ 504,000
56,000
$ 560,000
$0
$1,093,500
$0
$121,500
$1,215,000
$0
$1,215,000
$1,215,000
Economic Development Authority
Establishment of TIF No. 16
April 4, 2015
Page 3
Staff Recommendation
Following the conclusion of the public hearing, Staff recommends the adoption of the attached
resolution approving modifications to the Master Development District including approving the
TIF plans for District no. 16 for inclusion.
Action Requested:
• Conduct Public Hearing to Consider Amendments to the Master Development
District to include TIF District 16
• Adopt Resolution Approving endments to Master Development Program, the
Establishment of Tax Increment Financing District No. 16 and Approving the Tax
Increment Financing Plan Therefor and Approving Business Subsidy
A RESOLUTION APPROVING AMENDMENTS TO MASTER DEVELOPMENT
PROG M, THE ESTABLISHMENT OF TAX INCREMENT FINANCING DISTRICT
NO. 16 AND APPROVING THE TAX INCREMENT FINANCING PLAN THEREFOR AND
APPROVING BUSINESS SUBSIDY
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. EDA -15-
HELD: APRIL 9, 2015
A. WHEREAS, the Apple Valley Economic Development Authority ( "EDA ") and
the City of Apple Valley, Minnesota (the "City ") have adopted a Master Development Program
and established the Master Development District and created Tax Increment Financing Districts
within the Master Development District and adopted Tax Increment Financing Plans with respect
to these Tax Increment Districts pursuant to Chapter 469 of the Minnesota Statutes in an effort to
encourage development and redevelopment of certain designated areas within the City, which
program, plans and districts have been amended from time to time; and
B. WHEREAS, it has been proposed that the City establish Tax Increment Financing
District No. 16 ( "TIF District No. 16 ") as an economic development district and adopt a Tax
Increment Financing Plan therefor (the "TIF Plan "); and
C. WHEREAS, Uponor NA Asset Leasing, Inc. (the "Company ") proposes to
construct an expansion of an existing manufacturing facility in the City (the "Project "). The
Company has requested that the EDA provide financial assistance to the Developer for the
Project by granting of a business subsidy (the "Business Subsidy ") and entering into a
Development Assistance Agreement among the Authority, the Company and Uponor, Inc. (the
"Agreement "); and
D. WHEREAS, on the date hereof, the Board of Commissioners (the "Board ") held a
public hearing on the question of the Business Subsidy, and said hearing was preceded by at least
10 days prior published notice thereof; and
E. The Business Subsidy is authorized under Minnesota Statutes, Sections 116J.993
through 116J.995 (the "Business Subsidy ").
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the EDA
as follows:
2. The Board hereby approves the Agreement and the EDA's assistance for the
Project in substantially the form submitted, and the President and the Secretary are hereby
authorized and directed to execute the Agreement on behalf of the EDA.
3. The approval hereby given to the Agreement includes approval of such additional
details therein as may be necessary and appropriate and such modifications thereof, deletions
6996474v1
1. The Program and the TIF Plan are hereby approved.
therefrom and additions thereto as may be necessary and appropriate and approved by the EDA
officials authorized by this resolution to execute the Agreement. The execution of the
Agreement by the appropriate officer or officers of the EDA shall be conclusive evidence of the
approval of the Agreement in accordance with the terms hereof.
ATTEST:
Adopted this 9th day of April, 2015.
Pamela J. Gackstetter, Secretary
The motion for adoption of the foregoing resolution was duly seconded by member
and upon a vote being taken thereof, the following voted in favor:
and the following voted against same:
Whereupon said resolution was declared duly passed and adopted.
6996474v1
2
Tom Goodwin, President
Member introduced the foregoing resolution and moved its adoption.
STATE OF MINNESOTA )
) ss.
COUNTY OF DAKOTA )
I, the undersigned, being the duly qualified and acting City Secretary of the Apple Valley
Economic Development Authority, DO HEREBY CERTIFY that the attached resolution is a true
and correct copy of an extract of minutes of a meeting of the Board of Commissioners of the
Apple Valley Economic Development Authority duly called and held, as such minutes relate to
the establishment of TIF District No. 16 and the approval of a business subsidy agreement.
WITNESS my hand as such Secretary of the Apple Valley Economic Development
Authority this day of April, 2015.
6996474v1
Secretary
oe.
city of App e
Valle
TO: President, Economic Development Authority Commissioners, and
Tom Lawell, Executive Director
FROM: Ron Hedberg, Finance Director
DATE: April 7, 2015
Action Requested:
EDIA- SA. Lb
ApprrioNAL_
MEMO
Finance Department
SUBJECT: Development Agreement Referenced by Authorizing Resolution for TIF 16
Discussion
Attached is the development agreement that is referenced in the resolution establishing TIF 16.
This development agreement is part of the action establishing Tax Increment Financing District
No. 16 and Approving the Tax Increment Financing Plan Therefor and Approving Business
Subsidy
DEVELOPMENT ASSISTANCE AGREEMENT
BY AND AMONG
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY, MINNESOTA
UPONOR NA ASSET LEASING, INC.
This document drafted by:
6967750v5
AND
UPONOR, INC.
BRIGGS AND MORGAN (MLI)
Professional Association
2200 First National Bank Building
St. Paul, Minnesota 55101
ARTICLE I
Section
ARTICLE II
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ARTICLE III
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ARTICLE IV
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ARTICLE V
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ARTICLE VI
Section
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EXHIBIT A
EXHIBIT B
EXHIBIT C
6967750\75
Table of Contents
DEFINITIONS... ............ ...... ... . ... ...... ............. ............ 3
Li. Definitions .... . .... ............... ....... .............. .......... ......... ...
REPRESENTATIONS AND WAR' NTIES ...... ..... ........ ..... .................. 5
2.1. Representations and Warranties of the Authority........................... ..... 5
2.2. Representations and Warranties of the Landlord ........ ..... ........ 5
2.3. Representations and Warranties of the Company.................. .......... 6
UNDERTAKINGS BY LANDLORD, COMPANY
ANDAUTHORITY__ ...... ..... . ...... . ... ............. .......... . ..... . ..... ..... . ..........8
3.1. Reimbursement ount; Application Fee . ..... ....... . ....... ....... 8
• • Reimbursement: Tax Increment Revenue Note ...... ............ ................. 8
3.3. MIF Grant 9
3.4. Real Property Taxes 9
3.5. Business Subsidies Act 9
3 .6. Prohibitions Against Assit ent and Transfer ..... ........... ................. 10
Page
.... ..................... 3
EVENTS OF DEFAULT 12
4.1. Events of Default Defined 12
4.2. Remedies on Default..... .......... . ..... ................. .................. ..... 12
4.3. No Remedy Exclusive.... ..... ........ ..... . .. . ..... ................. ........ ...... 13
4.4. No Implied Waiver 13
4.5. Agreement to Pay Attorney's Fees and Expenses ......... ........ 13
4.6. Indemnification of Authority 13
LANDLORD'S OPTION TO TERMINATE AGREEMENT ..... ....... .......... . 1 5
5.1. The Landlord's Option to Terminate... ........ . ............... ......... ....... ....... 1 5
5.2. Action to Terminate .............. . ..... ...... ....... .......... . ....... ................ 1 5
5.3. Effect of Termination......................................................................... 1 5
ADDITIONAL PROVISIONS ............... ....... ...................................... ..... ..... 16
6.1. Restrictions on Use 1 6
6.2. Conflicts of Interest ....... ..... ..................... ....... . ....... ......................... 16
6.3. Titles of Articles and Sections ............ . ... . . ...... ............. ....... ....... 16
6.4. Notices and Demands ............. ...................... ...... ....... ...... ............... 16
6.5. Counterparts ........... ........................ ..... ............................................. 17
6.6. Law Governing ...................... ..... ......... ................ ....... ........... ..... 17
6.7. Expiration ..... ...... ...... ....................................... .................. ............. 1 7
6.8. Provisions Surviving Rescission or Expiration ................................ 17
6.9. Assignability of Agreement .......................... ...... ............................... 1 7
Legal Description of Development Property ................ ...... ......................... A-1
Formof TIF Note.................................. ...... ................................................. B-1
SiteImprovements ...... ..... ...................................................................... C-1
THIS AGREEMENT, made as of the day of , 2015, by and between the
Apple Valley Economic Development Authority, Minnesota (the "Authority"), a body corporate
and politic, organized and existing under the laws of the State of Mi esota, Uponor, Inc., an
Illinois corporation (the "Company"), and Uponor NA Asset Leasing, Inc., a Delaware
corporation (the "Landlord").
WITNESSETH:
DEVELOPMENT ASSISTANCE AGREEMENT
WHEREAS, pursuant to Minnesota Statutes, Sections 469.124 to 469.134 and Sections
469.174 to 469.1794, as amended, the City of Apple Valley, Minnesota (the "City") and the
Authority have heretofore established the Apple Valley Master Development District (the
"Development District") and have adopted a development program therefor (the "Development
Program"); and
WHEREAS, pursuant to the provisions of Minnesota Statutes, Section 469.174 through
469.1794, as amended (hereinafter, the "Tax Increment Act"), the City and the Authority have
heretofore established, within the Development District, Tax Increment Financing District No.
16 (the "Tax Increment District") and has adopted a tax increment financing plan therefor (the
"Tax Increment Plan") which provides for the use of tax increment financing in connection with
certain development within the Development District; and
WHEREAS, in order to achieve the objectives of the Development Program and
particularly to make the land in the Development District available for development by private
enterprise in conformance with the Development Program, the Authority has determined to
authorize and issue a tax increment financing note as set forth herein to assist the Landlord with
the financing of certain costs of a Project (as hereinafter defined) to be constructed within the
Tax Increment District as more particularly set forth in this Agreement; and
WHEREAS, the Landlord intends to lease the Project to the Company pursuant to a
triple-net lease (the "Lease");
WHEREAS, the Authority believes that the development and construction of the Project,
and fulfillment of this Agreement are vital and are in the best interests of the Authority, the
health, safety, morals and welfare of residents of the City, and in accordance with the public
purpose and provisions of the applicable state and local laws and requirements under which the
Project has been undertaken and is being assisted; and
WHEREAS, the requirements of the Business Subsidy Law, Minnesota Statutes, Section
116J.993 through 116J.995, apply to this Agreement; and
WHEREAS, the Authority has adopted criteria for awarding business subsidies that
comply with the Business Subsidy Law, after a public hearing for which notice was published;
and
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WHEREAS, the Authority's Board of Commissioners has approved this Agreement as a
subsidy agreement under the Business Subsidy Law;
NOW, THEREFORE, in consideration of the premises and the mutual obligations of the
parties hereto, each of them does hereby covenant and agree with the other as follows:
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions. All capitalized terms used and not otherwise defined herein
shall have the following meanings unless a different meaning clearly appears from the context:
Agreement means this Agreement, as the same may be from time to time modified,
amended or supplemented;
Authority means the Apple Valley Economic Development Authority, its successors and
assigns;
Business Day means any day except a Saturday, Sunday or a legal holiday or a day on
which banking institutions in the City are authorized by law or executive order to close;
City means the City of Apple Valley, Minnesota;
Commencement of Construction means the issuance of all building permits and any other
permits the City requires for expansion and construction of the Project and commencement of
physical construction of the Project on the Development Property;
County means Dakota County;
Company means Uponor, Inc., an Illinois corporation, its successors and assigns;
Development District means the real property included in the Authority's Master
Development District;
Development Program means the Authority's Master Development Program, as amended,
approved in connection with the Development District;
Development Property means the real property described in Exhibit A attached to this
Agreement;
Event of Default means any of the events described in Section 4.1 hereof;
Landlord means Uponor NA Asset Leasing, Inc., a Delaware corporation, its successors
and assigns;
MIF Grant means a Minnesota Investment Fund grant by the State to the City to provide
additional assistance to the Company or Landlord for the Project.
Note Payment Date means August 1, 2017, and each February 1 and August 1 of each
year thereafter to and including February 1, 2026; provided, that if any such Note Payment Date
should not be a Business Day, the Note Payment Date shall be the next succeeding Business
Day;
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Other Agreements means the Business Subsidy Agreement entered into between the
Authority and the Company with respect to the $800,000 grant from the Authority and the
Business Subsidy Agreement to be entered into between the City and the Company with respect
to the MIF Grant.
Prime Rate means the rate of interest from time to time publicly announced by U.S. Bank
National Association in St. Paul, Minnesota, as its "prime rate" or "reference rate" or any
successor rate, which rate shall change as and when that rate or successor rate changes;
Project means the renovation and expansion of an existing 36,000 square foot bus garage
to create an approximately 86,000 square foot office and manufacturing facility consisting of
approximately 6,000 square feet of office space and approximately 80,000 square feet of
manufacturing space to be located on the Development Property;
Site Improvements means those site improvements identified on Exhibit C attached
hereto to be undertaken on the Development Property;
State means the State of Minnesota;
Tax Increment Act means Minnesota Statutes, Sections 469.174 through 469.1794, as
amended;
Tax Increment District means Tax Increment Financing District No. 16 located within the
Development District, a description of which is set forth in the Tax Increment Financing Plan,
which was qualified as an economic development district under the Tax Increment Act;
Tax Increment Financing Plan means the tax increment financing plan approved for the
Tax Increment District by the Board of Commissioners of the Authority and any future
amendments thereto;
Tax Increments means 90% of the tax increments derived from the Development
Property which have been received by the Authority in accordance with the provisions of
Minnesota Statutes, Section 469.177;
Termination Date means the earlier of (i) February 1, 2026, (ii) the date the TIF Note is
paid in full, or (iii) the date this Agreement is terminated or rescinded in accordance with its
terms;
TIF Note means the Tax Increment Revenue Note (Uponor, Inc. Project) to be executed
by the Authority and delivered to the Landlord pursuant to Article III hereof, the form of which
is attached hereto as Exhibit B; and
Unavoidable Delays means delays, outside the control of the party claiming its
occurrence, which are the direct result of strikes, other labor troubles, unusually severe or
prolonged bad weather, acts of God, fire or other casualty to the Project, litigation commenced
by third parties which, by injunction or other similar judicial action or by the exercise of
reasonable discretion, directly results in delays, or acts of any federal, state or local
gove ental unit (other than the Authority) which directly result in delays.
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ARTICLE II
REPRESENTATIONS AND WA
IN A
NTIES
Section 2.1. Representations and Warranties of the Authority. The Authority makes
the following representations and warranties:
(1) The Authority is a public body, corporate and politic of the State and has
the power to enter into this Agreement and carry out its obligations hereunder.
(2) The Tax Increment District is an "economic development district" within
the meaning of Minnesota Statutes, Section 469.174, Subdivision 12, and was created, adopted
and approved in accordance with the terms of the Tax Increment Act.
( The development contemplated by this Agreement is in conformance with
the development objectives set forth in the Development Program.
(4) To finance certain costs within the Tax Increment District, the Authority
proposes, subject to the further provisions of this Agreement, to apply Tax Increments to
reimburse the Landlord for a portion of the costs of certain Site Improvements incurred by the
Landlord in connection with the Project as further provided in this Agreement.
( The Authority makes no representation or warranty, either express or
implied, as to the Development Property or its condition or the soil conditions thereon, or that the
Development Property shall be suitable for the Landlord's purposes or needs.
Section 2.2. Representations and Warranties of the Landlord. The Landlord makes the
following representations and warranties:
(1) The Landlord is a Delaware corporation, is authorized to do business in
the State and has the power and authority to enter into this Agreement and to perform its
obligations hereunder and doing so will not violate its articles of incorporation or bylaws, or the
laws of the State or the State of Delaware, and by proper action has authorized the execution and
delivery of this Agreement.
(2) The Landlord shall cause the Project to be constructed in accordance with
the terms of this Agreement, the Development Program and the Tax Increment Financing Plan,
and all applicable local, state and federal laws and regulations (including, but not limited to,
environmental, zoning, energy conservation, building code and public health laws and
regulations).
( The construction of the Project would not be undertaken by the Landlord,
and in the opinion of the Landlord would not be economically feasible within the reasonably
foreseeable future, without the assistance and benefit to the Landlord provided for in this
Agreement.
(4) Neither the execution and delivery of this Agreement, the consummation
of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and
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conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of,
the terms, conditions or provision of any contractual restriction, evidence of indebtedness,
agreement or instrument of whatever nature to which the Landlord is now a party or by which it
is bound, or constitutes a default under any of the foregoing.
(5) The Landlord will cooperate fully with the City with respect to any
litigation commenced with respect to the Project.
(6) The Landlord will cooperate fully with the City in resolution of any
traffic, parking, trash removal or public safety problems which may arise in connection with the
construction of the Project.
(7) The Landlord shall commence construction of the Project by
, 20 , and, barring Unavoidable Delays, the Project shall be substantially
completed by , 20_.
( The Landlord acknowledges that Tax Increment projections contained in
the Tax Increment Financing Plan are estimates only and the Landlord acknowledges that it shall
place no reliance on the amount of projected Tax Increments and the sufficiency of such Tax
Increments to reimburse the Landlord for the costs of the Site Improvements as provided in
Article III.
( The Landlord will not seek a reduction in the market value as determined
by the Dakota County Assessor of the Project or other facilities, if any, that it constructs on the
Development Property, pursuant to the provisions of this Agreement, for so long as the TIF Note
remains outstanding.
Section 2.3. Representations and Warranties of the Company. The Company makes
the following representations and warranties:
(1) The Company is an Illinois corporation, is authorized to do business in the
State and has the power and authority to enter into this Agreement and to perform its obligations
hereunder and doing so will not violate its articles of incorporation or bylaws, or the laws of the
State or the State of Illinois, and by proper action has authorized the execution and delivery of
this Agreement.
(2) Neither the execution and delivery of this Agreement, the consummation
of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and
conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of,
the terms, conditions or provision of any contractual restriction, evidence of indebtedness,
agreement or instrument of whatever nature to which the Company is now a party or by which it
is bound, or constitutes a default under any of the foregoing.
( The Company will cooperate fully with the Authority with respect to any
litigation commenced with respect to the Project.
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(4) The Company will cooperate fully with the Authority in resolution of any
traffic, parking, trash removal or public safety problems which may arise in connection with the
construction and operation of the Project.
(5) The Company shall operate the Project as a manufacturing facility for the
term of this Agreement.
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(1) As consideration for the execution of this Agreement and the construction
of the Project by the Landlord and the operation of the Project by the Company, subject to the
further provisions of this Agreement, including but not limited to the limitations on source of
reimbursement and amount set forth in Section 3.2 hereof, the Landlord agrees to construct the
Site Improvements and pay the costs thereof, and the City agrees to reimburse the Landlord the
lesser of $504,000 or the costs of the Site Improvements actually incurred and paid by the
Landlord (the "Reimbursement Amount") as further provided in Section 3.2.
$25,000.
ARTICLE III
UNDERTAKINGS BY LANDLORD, COMPANY AND AUTHORITY
Section 3.1. Reimbursement Amount; Application Fee.
(2) The City has waived its tax increment financing application fee of
Section 3.2. Reimbursement: Tax Increment Revenue Note. The Authority shall
reimburse for the costs identified in Section 3.1 through the issuance of the Authority's TIF Note
in substantially the form attached to this Agreement as Exhibit B, subject to the following
conditions:
(1) The TIF Note shall be dated, issued and delivered when the Landlord shall
have demonstrated in writing to the reasonable satisfaction of the Authority that the Site
Improvements have been completed and that the Landlord has incurred and paid all costs of the
Site Improvements, as described in and limited by Section 3.1, and the Landlord shall have
submitted paid invoices for the costs of the Site Improvements to the City. The principal amount
of the Note shall not be less than the Reimbursement A ount.
Increments.
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(2)
(
No interest shall be paid on the TIF Note.
The principal amount of the TIF Note shall be payable solely from the Tax
(4) On each Note Payment Date and subject to the provisions of the TIF Note,
the Authority shall pay, against the principal outstanding on the TIF Note, any Tax Increments
received by the Authority during the preceding 6 months. All such payments shall be applied to
reduce the principal of the TIF Note.
(5) The TIF Note shall be a special and limited obligation of the Authority
and not a general obligation of the Authority, and only Tax Increments shall be used to pay the
principal on the TIF Note.
(6) The Authority's obligation to make payments on the TIF Note on any Note
Payment Date or any date thereafter shall be conditioned upon the requirements that: (A) there
shall not at that time be an Event of Default that has occurred and is continuing under this
Agreement and (B) this Agreement shall not have been rescinded pursuant to Section 4.2.
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(7) The TIF Note shall be governed by and payable pursuant to the additional
terms thereof, as set forth in Exhibit B. In the event of any conflict between the terms of the TIF
Note and the terms of this Section 3.2, the terms of the TIF Note shall govern. The issuance of
the TIF Note pursuant and subject to the terms of this Agreement, and the taking by the
Authority of such additional actions as bond counsel for the TIF Note may require in connection
therewith, are hereby authorized and approved by the Authority.
Section 3.3. MIF Grant. The City has applied for a MIF Grant in the amount of
$750,000. In connection with the award of the MIF Grant, the City shall enter into a business
subsidy agreement with the Company.
Section 3.4. Real Property Taxes. The Landlord acknowledges that it is obligated
under law to pay all real property taxes payable with respect to the Development Property and
pursuant to the provisions of the Agreement until the Landlord's obligations have been assumed
by any other person with the written consent of the Authority and pursuant to the provisions of
this Agreement.
(1) It will not seek administrative review or judicial review of the
applicability of any tax statute relating to the taxation of real property contained on the
Development Property determined by any tax official to be applicable to the Project or the
Landlord or raise the inapplicability of any such tax statute as a defense in any proceedings,
including delinquent tax proceedings; provided, however, "tax statute" does not include any local
ordinance or resolution levying a tax;
(2) It will not seek administrative review or judicial review of the
constitutionality of any tax statute relating to the taxation of real property contained on the
Development Property determined by any tax official to be applicable to the Project or the
Landlord or raise the unconstitutionality of any such tax statute as a defense in any proceedings,
including delinquent tax proceedings; provided, however, "tax statute" does not include any local
ordinance or resolution levying a tax;
( It will not seek any tax deferral or abatement, either presently or
prospectively authorized under any other State or federal law, of the taxation of real property
contained in the Development Property between the date of execution of this Agreement and the
Terminntinn nnte.
(1) In order to satisfy the provisions of Minnesota Statutes, Sections 116J.993
to 116J.995 (the "Business Subsidies Act"), the Landlord acknowledges and agrees that the
amount of the "Business Subsidy" granted to the Landlord under this Agreement is the
reimbursement of $504,000 for Site Improvements paid by the Landlord and reimbursed to the
Landlord from Tax Increments and $25,000 for the waiver of the tax increment financing
application fee. The Business Subsidy is needed because the Project is not sufficiently feasible
for the Landlord to undertake without the Business Subsidy. The Tax Increment District is an
economic development district and the public purpose of the Business Subsidy is to encourage
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The Landlord agrees that prior to the Termination Date:
Section 3.5. Business Subsidies Act.
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the expansion of manufacturing facilities in the City. The Company agrees that it will meet the
following goals (the "Goals") in connection with the Development Property and will create at
least seventy-five (75) full-time jobs at an hourly wage of at least $15.00 per hour, plus benefits,
within three (3) years from the "Benefit Date", which is the earlier of the date the Landlord
completes the Project or the Company occupies the Project.
(2) If the Goals are not met, the Landlord agrees to repay all or a part of the
Business Subsidy to the Authority, plus interest ("Interest") set at the implicit price deflator
defined in Minnesota Statutes, Section 275.70, Subdivision 2, accruing from and after the
Benefit Date, compounded semiannually. If the Goals are met in part, the Landlord will repay a
portion of the Business Subsidy (plus Interest) determined by multiplying the Business Subsidy
by a fraction, the numerator of which is the number of jobs in the Goals which were not created
at the wage level set forth above and the denominator of which is seventy-five (75) (i.e. the
number of jobs set forth in the Goals).
( The Company agrees to: (i) report its progress on achieving the Goals to
the Authority until the later of the date the Goals are met or three years from the Benefit Date, or,
if the Goals are not met, until the date the Business Subsidy is repaid, (ii) include in the report
the information required in Minnesota Statutes, Section 116J.994, Subdivision 7 on forms
developed by the Minnesota Department of Employment and Economic Development, and (iii)
send completed reports to the Authority. The Company agrees to file these reports no later than
March 1 of each year commencing March 1, 2016, and within 30 days after the deadline for
meeting the Goals. The Authority agrees that if it does not receive the reports, it will mail the
Company a warning within one week of the required filing date. If within 14 days of the post
marked date of the warning the reports are not made, the Company agrees to pay to the Authority
a penalty of $100 for each subsequent day until the report is filed up to a maximum of $1,000.
(4) The Company agrees to continue operations within the City for at least
five (5) years after the Benefit Date.
( There are no other state or local government agencies providing financial
assistance for the Project other than the Authority which is providing the TIF Note.
the Company.
(6) Uponor NA Holdings, Inc. is the parent corporation of the Landlord and
( The Company and the T Andlord certify that they do not appear on the
Minnesota Department of Employment and Economic Development's list of recipients that have
failed to meet the terms of a business subsidy agreement.
Section 3.6. Prohibitions Against Assignment and Transfer. The Landlord shall own
the Project for a period of not less than 5 years commencing from the date that the construction
of the Project is substantially complete. The Landlord has not made nor will make, or suffer to
be made, any total or partial sale, assignment, conveyance, lease (other than leases of space in
the Project constructed as a part of the Project), or other transfer, with respect to this Agreement
or the Development Property or any part thereof or any interest therein, or any contract or
agreement to do any of the same, without the prior written approval of the Authority, which shall
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not be unreasonably withheld. The Authority shall be entitled to require as conditions to any
such approval that: (i) the proposed transferee have the qualifications and financial
responsibility, as reasonably determined by the Authority, necessary and adequate to fulfill the
obligations undertaken in this Agreement by the Landlord; and (ii) the proposed transferee, by
recordable instrument satisfactory to the Authority shall, for itself and its successors and assigns,
assume all of the obligations of the Landlord under this Agreement. No transfer of, or change
with respect to, ownership in the Development Property or any part thereof, or any interest
therein, however consummated or occurring and whether voluntary or involuntary, shall operate,
legally or practically, to deprive or limit the Authority of or with respect to any rights or
remedies or controls provided in or resulting from this Agreement with respect to the
Development Property and the completion of the Project that the Authority would have had, had
there been no such transfer or change. There shall be submitted to the Authority for review all
legal documents relating to the transfer.
In the absence of specific written agreement by the Authority to the contrary, no such
transfer or approval by the Authority thereof shall be deemed to relieve the Company, or any
other party bound in any way by this Agreement or otherwise with respect to the completion of
the Project, from any of their obligations with respect thereto.
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or
(
ARTICLE IV
EVENTS OF DEFAULT
Section 4.1. Events of Default Defined. The following shall be "Events of Default"
under this Agreement and the term "Event of Default" shall mean whenever it is used in this
Agreement any one or more of the following events:
( Failure by the Landlord to timely pay any ad valorem real property taxes
assessed or special assessments or other City charges with respect to the Development Property.
(2) Failure of the Company or the Landlord to observe or perform any
covenant, condition, obligation or agreement on its part to be observed or performed under this
Agreement or the Other Agreements.
( Failure by the Landlord to cause the construction of the Project to be
completed pursuant to the terms, conditions, and limitations of this Agreement.
(4) The holder of any mortgage on the Development Property or any
improvements thereon, or any portion thereof, commences foreclosure proceedings as a result of
any default under the applicable mortgage documents.
If the Company or the Landlord shall:
(a) file any petition in bankruptcy or for any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under the United
States Bankruptcy Act of 1978, as amended or under any similar federal or state law; or
(b) make an assignment for the benefit of its creditors; or
(c) admit in writing its inability to pay its debts generally as they become due;
(d) be adjudicated a bankrupt or insolvent; or if a petition or answer proposing
the adjudication of the Company or the Landlord as bankrupt or its reorganization under
any present or future federal bankruptcy act or any similar federal or state law shall be
filed in any court and such petition or answer shall not be discharged or denied within
sixty (60) days after the filing thereof; or a receiver, liquidator or trustee of the Company
or the Landlord, or of the Project, or part thereof, shall be appointed in any proceeding
brought against the Company or the Landlord, and shall not be discharged within sixty
(60) days after such appointment, or if the Company or the Landlord, shall consent to or
acquiesce in such appointment.
Section 4.2. Remedies on Default. enever any Event of Default referred to in
Section 4.1 occurs and is continuing, the Authority, as specified below, may take any one or
more of the following actions against the defaulting party (i.e., the Company or the Landlord, as
the case may be) after the giving of thirty (30) days' written notice to the Company and the
Landlord, but only if the Event of Default has not been cured within said thirty (30) days; or if
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such noncompliance cannot reasonably be cured within thirty (30) days of receipt of such notice,
the defaulting party has not provided assurances, reasonably satisfactory to the Authority, that
such noncompliance will be cured as soon as reasonably possible.
(1) The. Authority may suspend its performance under this Agreement and the
TIF Note until it receives assurances from the defaulting party, deemed adequate by the
Authority in its reasonable judgment, that the defaulting party will cure its default and continue
its performance under this Agreement.
(2) The Authority may cancel and rescind the Agreement and the TIF Note.
(3) The Authority may take any action, including legal or administrative
action, in law or equity, against the Landlord or the Company, which may appear necessary or
desirable to enforce performance and observance of any obligation, agreement, or covenant of
the Landlord or the Company under this Agreement.
Section 4.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to
the non- defaulting party is intended to be exclusive of any other available remedy or remedies,
but each and every such remedy shall be cumulative and shall be in addition to every other
remedy given under this Agreement or now or hereafter existing at law or in equity or by statute.
No delay or omission to exercise any right or power accruing upon any default shall impair any
such right or power or shall be construed to be a waiver thereof, but any such right and power
may be exercised from time to time and as often as may be deemed expedient.
Section 4.4. No Implied Waiver. In the event any agreement contained in this
Agreement should be breached by any party and thereafter waived by any other party, such
waiver shall be limited to the particular breach so waived and shall not be deemed to waive any
other concurrent, previous or subsequent breach hereunder.
Section 4.5. Agreement to Pay Attorney's Fees and Expenses. enever any Event of
Default occurs and the Authority shall employ attorneys or incur other expenses for the
collection of payments due or to become due or for the enforcement or performance or
observance of any obligation or agreement on the part of the Landlord or the Company herein
contained, the Company and the Landlord agree that it shall, on demand therefor, pay to the
Authority the reasonable fees of such attorneys and such other expenses so incurred by the
Authority. The Company and the Landlord shall not be required to pay the fees of such attorneys
and such other expenses so incurred by the Authority in the event the Authority's determination
of an Event of Default and its pursuit of collection or performance is non - meritorious as
determined by a neutral third party.
Section 4.6. Indemnification of Authority.
(1) The Landlord (a) releases the Authority and its governing body members,
officers, agents, including the independent contractors, consultants and legal counsel, servants
and employees (collectively, the "Indemnified Parties ") from, (b) covenants and agrees that the
Indemnified Parties shall not be liable for, and (c) agrees to indemnify and hold harmless the
Indemnified Parties against, any claim, cause of action, suit or liability for loss or damage to
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property or any injury to or death of any person occurring at or about or resulting from any
defect in the Project or on the Development Property.
(2) Except for any willful misrepresentation or any willful or wanton
misconduct of the Indemnified Parties, the Landlord agrees to protect and defend the
Indemnified Parties, now and forever, and further agrees to hold the aforesaid harmless from any
claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever
arising or purportedly arising from the actions or inactions of the Landlord (or if other persons
acting on its behalf or under its direction or control) under this Agreement, or the transactions
contemplated hereby or the acquisition, construction, installation, ownership, and operation of
the Project; provided, that this indemnification shall not apply to the warranties made or
obligations undertaken by the Authority in this Agreement or to any actions undertaken by the
Authority which are not contemplated by this Agreement but shall, in any event and without
regard to any fault on the part of the Authority, apply to any pecuniary loss or penalty (including
interest thereon from the date the loss is incurred or penalty is paid by the Authority at a rate
equal to the Prime Rate) as a result of the Project causing the Tax Increment District to not
qualify or cease to qualify as an "economic development district" under Section 469.174,
Subdivision 12 of the Act and Section 469.176, Subdivision 4c or to violate limitations as to the
use of Tax Increments as set forth in Section 469.176, Subdivision 4c and Subdivision 7.
( The Company covenants and agrees that the Indemnified Parties shall not
be liable for and agrees to indemnify and hold harmless the Indemnified Parties against any loss
or damage to property or any injury to or death of any person occurring after the Completion
Date at or about or resulting from any defect in the Project, provided that the foregoing
indemnification shall not be effective for any actions of the Indemnified Parties that are not
contemplated by this Agreement.
(4) Except for any willful misrepresentation or any willful or wanton
misconduct of the Indemnified Parties, the Company agrees to protect and defend the
Indemnified Parties, now and forever, and further agrees to hold the aforesaid harmless from any
claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever
arising or purportedly arising from the actions or inactions of the Company (or if other persons
acting on its behalf or under its direction or control) under this Agreement, or the transactions
contemplated hereby or the operation of the Project; provided, that this indemnification shall not
apply to the warranties made or obligations undertaken by the City in this Agreement or to any
actions undertaken by the City which are not contemplated by this Agreement but shall, in any
event and without regard to any fault on the part of the City, apply to any pecuniary loss or
penalty (including interest thereon from the date the loss is incurred or penalty is paid by the City
at a rate equal to the Prime Rate) as a result of the Project causing the Tax Increment District to
not qualify or cease to qualify as an "economic development district" under Section 469.174,
Subdivision 12 of the Act and Section 469.176, Subdivision 4c or to violate limitations as to the
use of Tax Increments as set forth in Section 469.176, Subdivision 4c and Subdivision 7.
( All covenants, stipulations, promises, agreements and obligations of the
Authority contained herein shall be deemed to be the covenants, stipulations, promises,
agreements and obligations of the Authority and not of any governing body member, officer,
agent, servant or employee of the Authority.
6967750v5
14
ARTICLE V
LANDLORD'S OPTION TO TE
INATE AGREEMENT
Section 5.1. The Landlord's Option to Terminate. This Agreement may be terminated
by the Landlord, if (i) the Landlord is in compliance with all material terms of this Agreement,
including satisfaction of the requirements of Section 3.2 and no Event of Default has occurred;
and (ii) the Authority fails to comply with any material term of this Agreement, and, after written
notice by the Landlord of such failure, the Authority has failed to cure such noncompliance
within ninety (90) days of receipt of such notice, or, if such noncompliance cannot reasonably be
cured by the Authority within ninety (90) days, of receipt of such notice, the Authority has not
provided assurances, reasonably satisfactory to the Landlord, that such noncompliance will be
cured as soon as reasonably possible.
Section 5.2. Action to Terminate. Termination of this Agreement pursuant to Section
5.1 must be accomplished by written notification by the Landlord to the Authority within sixty
(60) days after the date when such option to terminate may first be exercised. A failure by the
Landlord to terminate this Agreement within such period constitutes a waiver by the Landlord of
its rights to terminate this Agreement due to such occurrence or event.
Section 5.3. Effect of Termination. If this Agreement is terminated pursuant to this
Article V, this Agreement shall be from such date forward null and void and of no further effect;
provided, however, the termination of this Agreement shall not affect the rights of either party to
institute any action, claim or demand for damages suffered as a result of breach or default of the
terms of this Agreement by the other party, or to recover amounts which had accrued and
become due and payable as of the date of such termination. Upon termination of this Agreement
pursuant to this Article V, the Landlord shall be free to proceed with the Project at its own
expense and without regard to the provisions of this Agreement; provided, however, that the
Authority shall have no further obligations to the Landlord with respect to the payment of Tax
Increments as set forth in Section 3.2.
6967750v5
15
Section 6.1. Restrictions on Use. Until termination of this Agreement, the Company
agrees for itself, its successors and assigns and every successor in interest to the Development
Property, or any iiart thereof, that the Company and such successors and assigns shall operate, or
cause to be operated, the Project as a manufacturing facility and shall devote the Development
Property to, and in accordance with, the uses specified in this Agreement.
Section 6.2. Conflicts of Interest. No member of the governing body or other official
of the Authority shall have any financial interest, direct or indirect, in this Agreement, the
Development Property or the Project, or any contract, agreement or other transaction
contemplated to occur or be undertaken thereunder or with respect thereto, nor shall any such
member of the governing body or other official participate in any decision relating to the
Agreement which affects his or her personal interests or the interests of any corporation,
partnership or association in which he or she is directly or indirectly interested. No member,
official or employee of the Authority shall be personally liable to the Authority in the event of
any default or breach by the Company or the Landlord or their successors or on any obligations
under the terms of this Agreement.
Section 6.3. Titles of Articles and Sections. Any titles of the several parts, articles and
sections of the Agreement are inserted for convenience of reference only and shall be
disregarded in construing or interpreting any of its provisions.
Section 6.4. Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand or other communication under this Agreement by any party to any
other shall be sufficiently given or delivered if it is dispatched by registered or certified mail,
postage prepaid, return receipt requested, or delivered personally, and
6967750v5
ARTICLE VI
ADDITIONAL PROVISIONS
( in the case of the Company is addressed to or delivered personally to:
Uponor, Inc.
5925 148 Street West
Apple Valley, 55124
Attn: Chief Executive Officer
(2) in the case of the Landlord is addressed to or delivered personally to:
Uponor NA Asset Leasing, Inc.
5925 148th Street West
Apple Valley, 55124
Attn:
16
Authority at:
(3) in the case of the Authority is addressed to or delivered personally to the
Apple Valley Economic Development Authority, Minnesota
Apple Valley Municipal Center
7100 West 147 Street
Apple Valley, 55124
or at such other address with respect to any such party as that party may, from time to time,
designate in writing and forward to the other, as provided in this Section.
Section 6.5. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall constitute one and the same instrument.
Section 6.6. Law Governing. This Agreement will be governed and construed in
accordance with the laws of the State.
Section 6.7. Expiration. This Agreement shall expire on the Termination Date, unless
earlier terminated or rescinded in accordance with its terms.
Section 6.8. Provisions Surviving Rescission or Expiration. Sections 4.5 and 4.6 shall
survive any rescission, termination or expiration of this Agreement with respect to or arising out
of any event, occurrence or circumstance existing prior to the Termination Date.
Section 6.9. Assignability of Agreement. This Agreement may be assigned only with
the consent of the Authority which consent shall not be unreasonably withheld. The TIF Note
may only be assigned pursuant to the terms of the TIF Note.
(
6967750v5
17
IN WITNESS WHEREOF, the Authority, the Company, and the Landlord have caused
this Agreement to be duly executed in their respective names and on their behalf, on or as of the
date first above written.
STATE OF MINNESOTA )
) SS
COUNTY OF DAKOTA )
6967750v5
APPLE VALLEY ECONOMIC
DEVELOPMENT AUTHORITY,
MINNESOTA
By
Its President
By
Its Secretary
The foregoing instrument was acknowledged before me this day of
2015, by , the President and , the Secretary, respectively of
the Apple Valley Economic Development Authority, Minnesota.
Notary Public
This is a signature page to the Development Assistance Agreement by and between the Apple
Valley Economic Development Authority, Minnesota, Uponor, Inc., and Uponor NA Asset
Leasing, Inc.
S-1
STATE OF MINNESOTA )
6967750v5
SS
COUNTY OF DAKOTA )
UPONOR, INC.
By
S-2
Its
The foregoing instrument was acknowledged before me this day of
2015, by , the of Uponor, Inc.
Notary Public
This is a signature page to the Development Assistance Agreement by and between the Apple
Valley Economic Development Authority, Minnesota, Uponor, Inc., and Uponor NA Asset
Leasing, Inc.
STATE OF MINNESOTA )
) SS
COUNTY OF DAKOTA )
6967750v5
UPONOR NA ASSET LEASING, INC.
By
S-3
Its
The foregoing instrument was acknowledged before me this day of
2015, by , the of Uponor, Inc.
Notary Public
This is a signature page to the Development Assistance Agreement by and between the Apple
Valley Economic Development Authority, Minnesota, Uponor, Inc., and Uponor NA Asset
Leasing, Inc.
6967750v5
EXHIBIT A
Legal Description of Development Property
Lot 1, Block 1, WIRSBO 3RD ADDITION, Dakota County, Minnesota
A -1
EXHIBIT B
Form of TIF Note
No.R -1 $
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF DAKOTA
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY
TAX INCREMENT REVENUE NOTE
(UPONOR, INC. PROJECT)
The Apple Valley Economic Development Authority, Minnesota (the "Authority "),
hereby acknowledges es itself to be indebted and, for value received, hereby promises to pay the
g
amounts hereinafter described (the "Payment Amounts ") to Uponor NA Asset Leasing, Inc. (the
"Landlord" ) or its registered assigns (the "Registered Owner "), but only in the manner, at the
times, from the sources of revenue, and to the extent hereinafter provided.
The principal amount of this Note shall equal from time to time the principal amount
stated above, as reduced to the extent that such principal installments shall have been paid in
whole or in part pursuant to the terms hereof; provided that the sum of the principal amount
listed above shall in no event exceed $504,000 as provided in that certain Development
Assistance Agreement, dated as of , 2015, as the same may be amended from
time to time (the "Development Assistance Agreement "), by and between the Authority, the
Landlord and Uponor, Inc. (the "Company "). This Note bears no interest.
The amounts due under this Note shall be payable on August 1, 2017, and on each
February 1 and August 1 thereafter to and including February 1, 2026, or, if the first should not
be a Business Day (as defined in the Development Assistance Agreement), the next succeeding
Business Day (the "Payment Dates "). On each Payment Date the Authority shall pay by check
or draft mailed to the p erson whom was the Registered Owner of this Note at the close of the last
business day preceding such Payment Date an amount equal to the sum of the Tax Increments
(hereinafter defined) received by the Authority during the six month period preceding such
Payment Date. All payments made by the Authority under this Note shall be applied to
principal.
The Payment Amounts due hereon shall be payable solely from 90% of tax increments
(the "Tax Increments ") from the Development Property (as defined in the Development
Assistance Agreement) within the Authority's Tax Increment Financing District No. 16 (the "Tax
Increment District ") within its Master Development District which are paid to the Authority and
which the Authority is entitled to retain pursuant to the provisions of Minnesota Statutes,
Sections 469.174 through 469.1794, as the same may be amended or supplemented from time to
time (the "Tax Increment Act "). This Note shall terminate and be of no further force and effect
following: (i) the last Payment Date defined above; (ii) on any date upon which the Authority
shall have terminated the Development Assistance Agreement under Section 4.2(2) thereof or the
6967750v5
B -1
Landlord shall have terminated the Development Assistance Agreement under Article V thereof;
(iii) on the date the Tax Increment District is terminated; or (iv) on the date that all principal
payable hereunder shall have been paid in full, whichever occurs earliest.
The Authority makes no representation or covenant, express or implied, that the Tax
Increments will be sufficient to pay, in whole or in part, the amounts which are or may become
due and payable hereunder.
The Authority's payment obligations hereunder shall be further conditioned on the fact
that no Event of Default under the Development Assistance Agreement shall have occurred and
be continuing at the time payment is due hereunder, but subject to the terms and conditions under
the Development Assistance Agreement such unpaid amounts may become payable if said Event
of Default shall thereafter have been timely cured. Further, if pursuant to the occurrence of an
Event of Default under the Development Assistance Agreement the Authority elects to cancel
and rescind the Development Assistance Agreement, the Authority shall have no further debt or
obligation under this Note whatsoever. Reference is hereby made to all of the provisions of the
Development Assistance Agreement, and said provisions are hereby incorporated into this Note
as though set out in full herein.
This Note is a special, limited revenue obligation and not a general obligation of the
Authority and is payable by the Authority only from the sources and subject to the qualifications
stated or referenced herein. This Note is not a general obligation of the Authority and neither the
full faith and credit nor the taxing powers of the Authority are pledged to the payment of the
principal of this Note and no property or other asset of the Authority, save and except the above-
referenced Tax Increments, is or shall be a source of payment of the Authority's obligations
hereunder.
This Note is issued by the Authority in aid of financing a project pursuant to and in full
conformity with the Constitution and laws of the State of Minnesota, including the Tax
Increment Act.
This Note may be assigned only with the consent of the Authority which consent shall
not be unreasonably withheld, provided that the assignment of the Note to Uponor, Inc. shall not
require the consent of the Authority. In order to assign the Note, the assignee shall surrender the
same to the Authority either in exchange for a new fully registered note or for transfer of this
Note on the registration records for the Note maintained by the Authority. Each permitted
assignee shall take this Note subject to the foregoing conditions and subject to all provisions
stated or referenced herein.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things
required by the Constitution and laws of the State of Minnesota to be done, to have happened,
and to be performed precedent to and in the issuance of this Note have been done, have
happened, and have been performed in regular and due form, time, and manner as required by
law; and that this Note, together with all other indebtedness of the Authority outstanding on the
date hereof and on the date of its actual issuance and delivery, does not cause the indebtedness of
the Authority to exceed any constitutional or statutory limitation thereon.
6967750v5
B-2
IN WITNESS WHEREOF, Apple Valley Economic Development Authority, Minnesota,
by its Board of Commissioners, has caused this Note to be executed by the manual signatures of
its President and Secretary and has caused this Note to be dated as of
20 .
President Secretary
DO NOT EXECUTE TIL PAID INVOICES FOR SITE IMPROVEMENTS ARE
GIVEN TO THE CITY - REFER TO SECTION 3.2
6967750v5
B -3
It is hereby certified that the foregoing Note was registered in the name of Uponor NA
Asset Leasing, Inc., and that, at the request of the Registered Owner of this Note, the
undersigned has this day registered the Note in the name of such Registered Owner, as indicated
in the registration blank below, on the books kept by the undersigned for such purposes.
NAME AND ADDRESS OF DATE OF SIGNATURE OF
REGISTERED OWNER REGISTRATION EDA SECRETARY
Uponor NA Asset Leasing, Inc.
5925 148 Street West
Apple Valley, MN 55124
Uponor, Inc.
5925 148 Street West
Apple Valley, MN 55124
6967750v5
CERTIFICATION OF REGIST • TION
B -4
6967750v5
EXHIBIT C
Site Improvements
Landscaping, including irrigation
Foundations and Footings
Grading/earthwork
Engineering
Survey
Environmental Testing
Soil Borings
Site Preparation
Onsite Utilities
Storm Water/Ponding
Outdoor Lighting
Onsite Road, Curb, Gutter, Driveway, Sidewalk and Streetscape Improvements
Parking
C-1
city of Apple
Vall
ITEM:
EDA MEETING DATE:
SECTION:
5A.2
April 9, 2015
Regular
PROJECT NAME:
Uponor Expansion
PROJECT DESCRIPTION:
Deferred loan business assistance.
STAFF CONTACT:
Margaret Dykes, Planner
APPLICANT:
City of Apple Valley
DEPARTMENT/DIVISION:
Community Development Department
PROJECT NUMBER:
PC-15-07
Actions Requested
• Open the public hearing, receive comments, and close the hearing.
If there are no outstanding issues, staff recommends the following action:
• Adopt the draft resolution approving the attached draft Business Subsidy Agreement
between the Apple Valley Economic Development Authority and Uponor, Inc to provide up
to $800,000 for substantial renovation and construction costs for an 86,000 sq. ft.
manufacturing facility at 14800 Everest Avenue.
Project Summary/Issues
Uponor Inc. ("Uponor") is a leading international provider of PEX plumbing, indoor climate and
infrastructure systems for the residential and commercial building markets in more than 100 countries
worldwide. Uponor North America employs nearly 400 people in their Apple Valley North American
headquarters, and they are the City's largest private employer. The company is experiencing solid
growth, and expects to continue that growth for the near future.
To accommodate this growth, Uponor is proposing to expand its operations in Apple Valley with the
substantial renovation and expansion of an existing building to create a facility that will consist of
80,000 sq. ft. of manufacturing floor space, and 6,000 sq. ft. of office space. The site is located at
14800 Everest Ave, a six-acre lot south of the main office and manufacturing building. Uponor
intends to seek LEED certification for the facility. The anticipated construction cost of $12,300,000
will cover major building and site improvements including the installation of stormwater detention
ponds, landscaping and gathering areas for employees, irrigation, and pathways connecting the site to
the exiting Uponor headquarters, which is adjacent to the subject site. The expansion and renovation
will add 50% more manufacturing capacity. The expanded manufacturing facility will allow for the
creation of 82 new jobs that will pay an average yearly salary of $43,294.
To assist with the expansion, Uponor has requested assistance from the State of Minnesota as well as
the City. The State has made available up to $1,500,000 through the Minnesota Investment Fund and
the Job Creation Fund programs. Uponor has requested $800,000 in assistance from the Apple Valley
Economic Development Authority ("EDA"), and approximately $504,000 in Tax Increment
Financing, which will be used to offset costs for expansion of the subject building. The $1,304,000
contribution by the EDA is approximately 11% of the total project costs.
Staff is recommending support of Uponor proposal for the following reasons:
1. The building improvements will increase the tax base and create manufacturing jobs with a
livable wage.
2. The City desires to grow is employment base to provide more opportunities for Apple Valley
residents to live and work in the City.
3. Uponor, Inc. cannot make the project economically feasible without assistance.
4. The project will diversify the existing jobs base in Apple Valley.
5. The project is ready to begin and would be completed by the end of 2015.
Attached to this memo is the Business Subsidy Agreement drafted by the EDA Attorney. Uponor
must create a minimum of 75 full-time jobs within three years of occupancy of the new facility and
each job must pay a minimum of $15 per hour. As the agreement is finalized, non-substantive
changes may occur. These changes must be approved by the Executive Director and the EDA
Attorney. The requested EDA assistance is a Business Subsidy, and, as required by State statute, a
public hearing must be held.
Budget Impact
The requested $800,000 will come from funds available to the EDA.
Attachment(s)
1. Resolution
2. Business Subsidy Agreement
WHEREAS, pursuant to the Minnesota Business Subsidy Act, set forth in Minnesota
Statues, Sections 116J.993 to 116J.995 ("Act"), the Apple Valley Economic Development
Authority (the "EDA") is authorized to grant a business subsidy for the public purpose of
increasing the City of Apple Valley's tax base; and
WHEREAS, Uponor Inc., an Illinois Corporation, ("Uponor") desires to construct an
86,000 sq. ft. office and manufacturing facility (the "Project") at 14800 Everest Avenue (Lot 2,
Block 1, Wirsbo Third Addition), which will increase the City's tax base and add a minimum of
80 jobs with a minimum wage of $15.00 per hour; and
and
and
ATTEST:
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. EDA-15-
A RESOLUTION APPROVING A BUSINESS SUBSIDY AGREEMENT BETWEEN THE
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY AND UPONOR, INC.
WHEREAS, Uponor cannot make the Project economically feasible without a subsidy;
WHEREAS, the EDA desires to provide Uponor a business subsidy, subject to the terms
and provisions set forth in the Business Subsidy Agreement, a copy of which is attached to this
Resolution ("Agreement"); and
WHEREAS, the EDA reviewed Uponor's request at a public hearing held April 9, 2015;
WHEREAS, the EDA finds it is in the best interest of the City and its residents that the
EDA enter into the attached Agreement to further economic development in the City.
NOW, THEREFORE, be it resolved by the Commissioners of the EDA that it approves
the terms and provisions of the Agreement, and the President and Secretary are authorized to
sign the same.
ADOPTED this 9 day of April, 2015.
Tom Goodwin, President
Pamela J. Gackstetter, Secretary
CERTIFICATE
I, Pamela Gackstetter, Apple Valley Economic Development Authority Secretary, hereby
certify that the forgoing is a true and correct copy of a resolution adopted by the Apple Valley
Economic Development Authority on April 9, 2015, the original of which is in my possession,
dated this day of , 2015.
Pamela J. Gackstetter, Secretary
BUSINESS SUBSIDY AGREEMENT
THIS BUSINESS SUBSIDY AGREEMENT ("Agreement") is made by and between
the Apple Valley Economic Development Authority, a public body corporate and a political
subdivision of the State of Minnesota ("Authority"), and Uponor, Inc., an Illinois Corporation
("Recipient").
WHEREAS, Recipient operates a facility located on real property legally described on
Exhibit "A," attached hereto that is owned by Uponor NA Asset Leasing, Inc., a Delaware
Corporation ("Property");
WHEREAS, Recipient desires to expand its existing manufacturing facility on the
Property ("Project");
subsidy;
WHEREAS, Recipient cannot make the Project economically feasible without a
Agreement agree as follows:
1
WHEREAS, in accordance with this Agreement, the Authority desires to subsidize the
Project in an amount of $800,000; and
NOW, THEREFORE, in consideration of the mutual undertakings, the parties to this
ARTICLE 1
Definitions
Section 1.1. Definitions. In addition to the defined terms set forth throughout this Agreement,
the following terms are defined as follows:
"Act" means the Minnesota Business Subsidy Act, set forth in Minnesota Statutes
Section 116.1.993-.995 and any successor statute.
"Agreement" means this Agreement, as the same may be from time to time modified,
amended or supplemented.
"Authority" means the Apple Valley Economic Development Authority, a public body
corporate and a political subdivision of the State of lkilinnesota.
. . •
"Benefit Date" means the earlier of the date the Project is completed or the Recipient
occupies the Project. The "Benefit Date" shall be certified by the Authority and the
Recipient in substantially the form set forth at Exhibit "B".
"City" means the City of Apple Valley, a Minnesota municipal corporation.
"Development Assistance Agreement" means the Development Assistance Agreement,
of even date hereof, between the Authority and Uponor NA Asset Leasing, Inc., a
Delaware corporation.
"Event of Default" means any of the events described in Section 4.1 of this
Agreement.
"Goals" means the job and wage goals described in Section 2.5 of this Agreement.
"Grant" means the amount of $800,000 provided to the Recipient by the Authority.
"Note" means the Promissory Note to be executed by the Recipient and delivered to
the Authority pursuant to Sections 3.1(b) and 3.2 of this Agreement, the form of which
is attached as Exhibit "C".
"Parties" means the Authority and the Recipient, collectively.
"Project" means the renovation and expansion of an existing 36,000 square foot bus
garage located on the Property to create at minimum an 86,000 square foot office and
manufacturing facility consisting of approximately 6,000 square feet of office space
and 80,000 square feet of manufacturing space.
"Recipient" means Uponor, Inc., an Illinois corporation, its successors and assigns.
"State" means the State of Minnesota.
ARTICLE 2
Business Subsidy
Section 2.1. Business Subsidy Requirements. The provisions of this Article establish the
requirements set forth in the Act (Minnesota Statutes Sections 116.1.993-.995 and any
successor statute).
Section 2.2. Incorporation of the Act. Recipient acknowledges and agrees that the provisions
of the Act apply to this Agreement and are incorporated herein by reference.
Section 2.3. Subsidy. The subsidy consists of the following: (1) the Grant provided to the
Recipient and (2) waiver of the tax increment financing application fee of $25,000 by the City
of Apple Valley.
Section 2.4. Public Purposes. The public purposes and goals of the subsidy are to increase the
tax base of the it by increasing the value of the Property and to create jobs with a livable
wage.
Section 2.5. Goals. The measurable, specific and tangible goals for the subsidy are to create
and retain at least fifty-five (55) new full time jobs located at the Property with an hourly
wage of at least $15.00 per hour, plus benefits, within two years from the Benefit Date and a
total of at least seventy-five (75) new full time jobs with the same wage requirements within
three years from the Benefit Date.
Section 2.6. Grant Repayment. If some or all of the Goals set forth in Section 2.5 of this
Agreement are not satisfied, the Recipient shall make payment to the Authority as required in
Article 3 of this Agreement.
2
Section 2.7. Necessity of Subsidy. The subsidy is needed because the Recipient cannot make
the Project economically feasible without the subsidy.
Section 2.8. Commitment. The Recipient agrees to retain the number of new full time jobs set
forth in Section 2.5 of this Agreement and continue operations within the City for at least five
(5) years following the Benefit Date.
Section 2.9. Other Financing. In addition to the assistance provided under this Agreement,
the Recipient has received or expects to receive for the Project, the following financial
assistance from other "grantors" as defined in the Act: (1) Tax Increment Financing (TIF)
from the Authority in an amount not to exceed approximately $504,000; (2) Job Creation
Fund (JCF) award in an amount not to exceed approximately $1,000,000 from the Minnesota
Department of Employment and Economic Development ("DEED"); and, (3) Minnesota
Investment Fund (MIF) assistance in an amount not to exceed approximately $750,000 from
DEED. Upon application and approval of the MIF assistance, a separate business subsidy
agreement will be completed.
Section 2.10. Reporting Requirements.
(a) Reporting Time Period. The Recipient shall submit to the Authority information
regarding the Goals from the date this Agreement is signed until one of the following dates,
whichever is later: (1) for two years after the Benefit Date, (2) until all of the Goals are met, or
(3) if the Goals are not met, until the date the Grant is repaid.
(b) Reporting Form. Recipient shall make its report on forms developed by DEED,
pursuant to Minn. Stat. § 116.1.994, subd. 7.
(c) Reporting Documentation. The report must include:
The type, public purpose, and amount of subsidies;
The hourly wage of each job created with separate bands of wages;
The sum of the hourly wages and cost of health insurance provided by
the Recipient with separate bands of wages;
The date the job and wage goals will be reached;
A statement of the Goals and an update on achievement of those Goals;
The name and address of the parent corporation of the Recipient, if any;
A list of all financial assistance by all grantors for the Improvements;
and
Any other information the Authority may be required to request.
(d) Submission Deadline and Penalty. The report must be submitted to the
Authority no later than March 1 of each year for the previous year. If the report is not
submitted by March 1, the Authority may mail a warning to the Recipient within one week of
the required submission date. If, after 14 days of the postmark date of the warning, the
Recipient fails to submit its report to the Authority, the Recipient must pay to the Authority a
penalty of $100.00 for each subsequent day until the report is submitted up to a maximum of
$1,000.00.
3
Section 2.11. Parent Corporation. Uponor NA Holdings, Inc. is the parent corporation of the
Recipient.
ARTICLE 3
Grant Disbursement, Terms and Conditions
Section 3.1. Conditions of Disbursement. The Grant in the amount of $800,000 shall be
disbursed upon satisfaction of the following conditions:
(a) Issuance of a certificate of occupancy for the Project by the City;
(b) Execution and delivery by the Recipient to the Authority of (1) the Note in
• .
substantially the form attached to this Agreement as Exhibit "C" and (2) a resolution of the
corporation authorizing execution of the Note; and
(c) No Event of Default exists.
Section 3.4. N
Section 3.2. Basic Terms of the Note. Subject to Section 3.4 of this Agreement, the principal
amount of the Grant shall be $800,000. The Grant shall be evidenced by the Note and subject
to repayment as provided herein. The Grant shall bear interest at a rate of six percent (6%) per
annum, and interest shall commence to accrue as of each disbursement date and continue until
satisfied or paid in full.
Section 3.3. Repayment. Subject to Section 3A of this Agreement, the Recipient agrees to
repay the Grant, including principal and interest, to the Authority if the Goals are not met.
Note Forgiveness. The Authority shall forgive $250,000 of the principal of the
Note if the Recipient creates at least forty (40) new full time jobs at an hourly wage of at least
$15.00 per hour, plus benefits, within one year from the Benefit Date. The Authority shall
forgive another $300,000 of the principal of the Note if the Recipient
fifty-five (55) new full time jobs w*
• .
Benefit Dat
creates a total of at least
ith the same wage requirements within two years from the
e. The Authority shall forgive the entire Note if the Recipient creates a total of at
least seventy-five (75) new full time jobs with the same wage requirements within three years
from the Benefit Date.
Section 3.5. Termination of Sections 3.2 and 3.3 of this Agreement. If the Note is fully
forgiven pursuant to Section 3.4 of this Agreement, the provisions of Sections 3.2 and 3.3 of
this Agreement shall terminate with the remainder of this Agreement remaining in full force
and effect.
ARTICLE 4
Default
Section 4.1. Events of Default. The Recipient shall be in default under this Agreement upon
the happening of any one or more of the following events:
4
(a) The Recipient fails to observe or perform any covenant, condition, obligation
or agreement on its part to be observed or performed under this Agreement.
(b) The Recipient fails to complete the Project, in its entirety.
(c) The Recipient fails to meet the Goals described in Section 2.5 of this
Agreement.
(d) Any material covenant, warranty, or representation of the Recipient shall
prove to be untrue in any material respect, provided such covenant, warranty or
representation of the Recipient remains untrue in any material respect for sixty (60) business
days after written notice thereof to the Recipient by the Authority.
(e) The Recipient fails to pay its debts as they become due, makes an assignment
for the benefit of its creditors, admits in writing its inability to pay its debts as they become
due, files a petition under any chapter of the Federal Bankruptcy Code or any similar law,
state of federal, now or hereafter existing. becomes "insolvent" as that to is generally
defined under the Federal Bankruptcy Code, files an answer admitting insolvency or inability
to pay its debts as they become due in any involuntary bankruptcy case commenced against
it, or fails to obtain a dismissal of such case within sixty (60) days after its commencement or
convert the case from one chapter of the Federal Bankruptcy Code to another chapter, or be
the subject of any order for relief in such bankruptcy case, or be adjudged a bankrupt or
insolvent, or has a custodian, trustee, or receiver appointed for it, or has any court take
jurisdiction of its property, or any part thereof, in any proceeding for the purpose of
reorganization, arrangement, dissolution or liquidation, and such custodian, trustee, or
receiver is not discharged, or such jurisdiction is not relinquished, - vacated or stayed within
sixty (60) days of the appointment.
(e) A final judgment is entered against the Recipient that the Authority
m i
reasonably deems will have a
aterial, adverse impact on the Recipient's ability to comply
with the Recipient's obligations under this Agreement.
(f) The Recipient fails to maintain its existence in good standing in the State of
Mi esota with the Minnesota Secretary of State.
(g) The Recipient fails to submit to the Authority a completed report as required
by Section 2.10 in this Agreement.
(h) The Recipient merges or consolidates with any other entity without the prior
written approval of the Authority.
Section 4.2. Rights and Remedies on Default.
(a) Whenever any Event of Default referred to in Section 4.1 occurs and is
continuing, the Authority shall have the right, at its option, and without demand or notice,
which is hereby waived, to declare all or any part of the Grant, less any principal and interest
forgiven in accordance with Section 3.4 of this Agreement, immediately due and payable.
5
(b) Notwithstanding this section, the Authority shall have all rights and remedies
available to it under any other provision of this Agreement or the Act.
(c) The Recipient agrees to pay the costs and expenses incurred by the Authority in
enforcing its rights under this Agreement, including, but not limited to, the Authority' s
attorneys' fees.
Section 4.3. No Remedy Exclusive. No remedy conferred upon or reserved to the Authority
is intended to be exclusive of any other available remedy or remedies, but each and every such
remedy shall be cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity.
Section 4.4. Waiver. The failure or delay of the Authority to take any action or assert any
right or remedy, or the partial exercise by the Authority of any right or remedy shall not be
deemed to be a waiver of such action, right or remedy if the circumstances creating such
action, right or remedy continue or repeat.
Section 4.5. Indemnification of Authority.
(a) The Recipient (1) releases the Authority and its governing body members,
officers, agents, including the independent contractors, consultants and legal counsel, servants
and employees (collectively, the "Indemnified Parties") from, (2) covenants and agrees that
the Indemnified Parties shall not be liable for, and (3) agrees to indemnify and hold harmless
the Indemnified Parties against any claim, cause of action, suit or liability for loss or damage
to property or any injury to or death of any person occurring at or about or resulting from any
defect in the Project or on the Property.
(b) Except for any willful misrepresentation or any willful or wanton misconduct
of the Indemnified Parties, the Recipient agrees to protect and defend the Indemnified Parties,
now and fore and further agrees to hold the aforesaid harmless from any claim, demand,
suit, action or other proceeding whatsoever by any person or entity whatsoever arising or
purportedly arising from the actions or inactions of the Recipient (or if other persons acting on
its behalf or under its direction or control) under this Agreement, or the transactions
contemplated hereby or the acquisition, construction, installation, ownership, and operation of
the Project, pro that this indemnification shall not apply to the warranties made or
obligations undertaken by the Authority in this Agreement or to any actions undertaken by the
Authority which are not contemplated by this Agreement.
(c) All covenants, stipulations, promises, agreements and obligations of the
Authority contained herein shall be deemed to be the covenants, stipulations, promises,
agreements and obligations of the Authority and not of any governing body member, officer,
agent, servant or employee of the Authority.
6
ARTICLE 5
Recipient's Representations and Warranties
Section 5.1. Representations and Warranties. The Recipient hereby represents and warrants
that:
(a) The Recipient is an Illinois corporation, is authorized to do business in the
State and has the power and authority to enter into this Agreement and to perform its
obligations hereunder and doing so will not violate its articles of incorporation or bylaws, or
the laws of the State or the State of Illinois, and by proper action has authorized the execution
and delivery of this Agreement.
(b) The Recipient shall cause the Project to be constructed in accordance with the
terms of this Agreement and all local, state and federal laws and regulations (including, but
not limited to environmental, zoning, energy conservation, building code and public health
laws and regulations).
(c) Neither the execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby, nor the fulfillment of or compliance with the terms and
conditions of this Agreement is pre limited by or conflicts with or results in a breach
of, the terms, conditions or provision of any contractual restriction, evidence of indebtedness,
agreement or instrument of whatever nature to which the Recipient, or its subsidiaries, is now
a party or by which it is bound, or constitutes a default under any of the foregoing.
(d) The Recipient will cooperate fully with the Authority with respect to any
litigation commenced with respect to the Project.
(e) The Recipient will cooperate fully with the Authority in resolution of any
traffic, parking, trash removal or public safety problems which may arise in connection with
the construction and operation of the Project.
(0 The financing commitments which the Recipient has obtained to finance
construction of the Project, together with the equity funds available to the Recipient, together
with the financing, provided by the Authority pursuant to this Agreement and certain state
grant funds, will be sufficient funds to enable the Recipient to successfully complete the
construction of the Project.
(g) The Recipient would not undertake the Project without the financing provided
by the Authority pursuant to this Agreement.
(h) Nothing contained in this Agreement, nor any act of the Authority, shall be
deemed or construed to create between the Authority and the Recipient any relationship
(except as borrower and lender), including, but not limited to, that of principal and agent,
limited or general partnership or joint venture.
7
(i) There are no other beneficiaries to this subsidy other than the Recipient.
(j) The Recipient does not appear on the Minnesota Department of Employment
and Economic Development's list of recipients that have failed to meet the terms of a business
subsidy agreement.
(k) The Recipient has reviewed this Agreement with an attorney, accountant,
financial advisor or other appropriate professional and fully understands the legal and tax
implications of this Agreement.
ARTICLE 6
Miscellaneous Provisions
Section 6.1. Conflicts of Interest. No member of the governing body or other official of the
Authority shall have any financial interest, direct or indirect, in this Agreement, the Property
or the Project, or any contract, agreement or other transaction contemplated to occur or be
undertaken thereunder or with respect thereto, nor shall any such member of the governing
body or other official participate in any decision r
n elating to the Agreement which affects his
or her personal interests or the interests o f Y corporation, partnership or association in
i
which he or she is directly or indirectly nterested i
. No member, official or employee of the
Authority shall be personally liable to the Authority in the event of any default or breach by
the Recipient or successor or on any obligations under the terms of this Agreement.
Section 6.2. Additional Reporting Requirements. In addition to the reporting requirements
set forth in Section 2.10 of this Agreement, Recipient shall provide to the Authority
infoimation for incorporation into any progress reports, as required by any state or local
government political agency, to monitor implementation of this Agreement for compliance
with state and local guidelines.
Section 6.3. Nondiscrimination. The provisions of Minnesota Statutes Section 181.59, which
relates to civil rights and discrimination, shall be considered a part of this Agreement as
though fully set forth herein, and the Recipient shall comply with each such provision
throughout the term of this Agreement.
Section 6.4. Workers Compensation Insurance. The Recipient shall obtain and maintain
workers compensation insurance as required by Minnesota Statutes, Section 176.181, subd. 2.
Section 6.5. unity. Nothing in this Agreement shall be construed as a waiver of the
Authority of any immunities, defenses or other limitations on liability to which the Authority
is entitled by law.
Section 6.6. Modifications. This Agreement may be modified solely through written
amendments hereto executed by the Recipient and the Authority.
8
Section 6.7. Notices and Demands.
Agreement by either party to the
dispatched by U.S. Mail or delivered
(a) as to the Authority:
(b) as to the Recipient:
Any notice, demand or other communication under this
other shall be sufficiently given or delivered if it is
personally to:
Apple Valley Municipal Center
7100 147 St. W.
Apple Valley, Minnesota 55124
Attn: Tom Goodwin, President
9
Uponor, Inc.
5925 148th Street West
Apple Valley, Minnesota 55124
Attn: Chief Executive Officer
or at such other address with respect to any party as that party may, from time to time,
designate in writing and forward to the other party as provided in this section.
Section 6.8. Binding Effect. The covenants and agreements in this Agreement shall bind and
•
benefit the heirs, executors, administrators, successors and assigns of the Parties.
Section 6.9. Merger. None of the provisions of this Agreement are intended to or shall be
merged by reason of any deed transferring any interest in the Property and any such deed shall
not be deemed to affect or impair the provisions and covenants of this Agreement.
Section 6.10. Choice of Law and Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State . Any disputes, controversies or claims
arising out of this Agreement shall be heard in the state or federal courts of Minnesota, and all
parties to this Agreement waive any objection to the jurisdiction of these courts, whether
based on convenience or otherwise.
Section 6.11. Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall constitute one and the same instrument.
Section 6.12. Headings. The Parties agree the headings and sub-headings used in this
Agreement are solely for convenience of reference, are no part of this Agreement, and are not
be considered in construing or interpreting this Agreement.
Section 6.13. Entire Agreement. This Agreement, with the exhibits hereto, constitutes the
entire agreement between the Parties pertaining to its subject matter and it supersedes all prior
contemporaneous agreements, representations and understandings of the Parties pertaining to
the subject matter of this Agreement.
Section 6.14. Separability. Wherever possible, each provision of this Agreement and each
related document shall be interpreted so that it is valid under applicable law. If any provision
of this Agreement or any related document is to any extent found invalid by a court or other
government entity of competent jurisdiction, that provision shall be ineffective only to the
extent of such invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement or any other related document.
IN WITNESS WHEREOF the Parties hereto have caused this Agreement to be duly
executed and delivered this day of , 2015.
STATE OF MINNESOTA )
) SS
)
The foregoing instrument was acknowledged before me this day of
2015, by , the President and , the
Secretary, respectively of the Apple Valley Economic Development Authority, Minnesota.
COUNTY OF
10
APPLE VALLEY ECONOMIC
DEVELOPMENT AUTHORITY,
MINNESOTA
By
Its President
By
Its Secretary
Notary Public
This is a signature page to the Business Subsidy Agreement by and between the Apple Valley
Economic Development Authority, Mi esota and Uponor, Inc.
STATE OF MINNESOTA )
) SS
COUNTY OF DAKOTA )
UPONOR, INC.
By
Its
The foregoing instrument was acknowledged before me this day of
2015, by , the of Uponor,
11
Notary Public
This is a signature page to the Business Subsidy Agreement by and between the Apple Valley
Economic Development Authority, Mi esota and Uponor, Inc.
APPROVAL OF ALL TE
STATE OF MINNESOTA )
) SS
COUNTY OF
S AND CONDITIONS IN THIS AGREE
The foregoing instrument was acknowledged before me this day of
2015, by Mary Hamann-Roland, the Mayor and Pamela J. Gackstetter, the City Clerk,
respectively of the City of Apple Valley, Minnesot.
Notary Pub
This is a signature page to the Business Subsidy Agreement by and between the Apple Valley
Economic Development Authority, Minnesota and Uponor, Inc.
12
By
Its City Cleric
lie
NT BY:
CITY OF APPLE VALLEY, M
ESOTA
By
Its Mayor
EXHIBIT A
Lot 1, Block 1, WIRSBO 3RD ADDITION, Dakota County, Minnesota.
13
EXHIBIT B
BENEFIT DATE CERTIFICATION
Pursuant to the Business Subsidy Agreement, made between Apple Valley Economic
Development Authority and Uponor, Inc., (hereinafter, the "Parties "), Uponor, Inc., was
approved for a subsidy in an amount of Eight Hundred Thousand and No /100 Dollars
($800,000.00) from Apple Valley Economic Development Authority.
This subsidy is subject to the terms and conditions set forth in the aforementioned
Business Subsidy Agreement.
IN WITNESS WHEREOF, the Parties do hereby acknowledge the Benefit Date as
defined in Minnesota Statutes § 116J.993, Subd. 2, is , 20 (the "Benefit
Date ").
APPLE VALLEY ECONOMIC EVEL T
AUTHORITY
By: Tom Goodwin
Its: President
By: Pamela J. Gackstetter
Its: Secretary
UPONOR TNC. ,
an Illinois corporation
By.
Its:
14
EXHIBIT C
UPONOR, INC. PROMISSORY NOTE TO
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY
FOR EXPANSION PROJECT IN APPLE VALLEY, MINNESOTA
Uponor, Inc., an Illinois corporation (the "Maker "), for value received, hereby
promises romises to pay to the Apple Valley Economic Development Authority, Minnesota (the
y )�
Authorit or its assigns (the Authority and any assigns are hereinafter referred to as the
"Holder"), at its designated principal office or such other place as the Holder may designate in
writin g, principal the sum of Eight Hundred Thousand and 00 /10Oths Dollars ($800,000.00) or
so much thereof as may be advanced under this Note, with interest as hereinafter provided.
The principal of this Note is payable as follows:
1. The rincl al shall bear interest at a rate of six percent (6%) per and
p p
interest shall commence to accrue as of the initial disbursement date.
2. Any outstanding principal rinci al and interest is due and payable on or before
3. This Note is
given pursuant to the Business Subsidy Agreement entered into by
the Maker and the Authorit y on 2015 (the " Agreement").
15
All of the agreements, conditions, covenants, provisions, and stipulations contained in
the Agreement, any ee ent, or an instrument securing this Note are hereby made a part of this Note to the
same extent and with the same force and effect as if they were fully set forth herein. It is
g
a ree that time is of the essence for this Note. If a default occurs under the Agreement, or
any �
an instrument securing this Note, then the Holder of this Note may at its right and option,
without notice, declare i e lately due and payable the principal balance of this Note,
any y
together with costs of collection including attorney fees incurred by the Holder of this
Note in collecting or enforcing a ent hereof, whether suit be brought or not, and all other
sums due hereunder, or under any mstrument securing this Note. The Maker agrees that the
Holder of this Note may, without notice tote Maker and without affecting the liability oft the
Maker, accept additional or substitute security fortis Note, or release any security or any
party liable for this Note or extend or renew t is Note.
4. The remedies ies of the Holder of this Note as provided herein, and in the
._ _ _ -� securing �___ '__ ,_ �- 1,,;,� Note, shall be cumulative and concurrent
Agreement, or any other i stru enL sec;urin this 1 shall be cum lac, r e and conq.s
and may be pursued and, successively or together , at the sole discretion of the Holder
of this Note, a y be exercised as often as occasion therefore shall occur; and the failure to
exercise an y such right or remedy shall in no event be construed as a waiver or release thereof.
g
ri
The Holder of this Note shall not be deemed, by any act of omission or commission, to
have waived any of its rights or remedies hereunder unless such waiver is in writing and
signed
by the Holder of this Note and then only to the extent specifically set forth in the writing. A
waiver with reference to one event shall not be construed as continuing or as a bar to or waiver
of any right or remedy as to a subsequent event. This Note may not be amended, modified, or
changed except only by an instrument in writing signed by the party against whom
enforcement of any such amendment, modifications, or change is sought.
5. This Note shall be governed by and construed in accordance with the laws of
the State of Minnesota without regard to its conflict of laws provisions. Any disputes,
controversies, or claims arising out of this Note shall be heard in the state or federal courts of
Minnesota, and all parties to this Note waive any objection to the jurisdiction of these courts,
whether based on convenience or otherwise.
6. This Note, with the Agreement, constitutes the en tire Note between the parties
pertaining to its subject matter and it supersedes all prior contemporaneous Notes,
representations, and understandings of the parties pertaining to the subject matter of this Note.
7. Wherever possible, each provision of this Note and each related document shall
be interpreted so that it is valid under applicable law. If any provision of this Note or any
related document is to any extent found invalid by a court or other governmental entity of
competent jurisdiction, that provision shall be ineffective only to the extent of such invalidity,
without invalidating the remainder of such provision or the remaining provisions of this Note
or any other related document.
IT IS HEREBY CERTIFIED AND RECITED that all conditions, acts, and things
required to exist, happen, and be performed precedent to or in the issuance of this Note do
exist, have happened, and have been performed in regular and due form as required by law.
IN WITNESS WHE OF the Maker has caused this Note to be duly executed as of
the day of
, 201
UPONOR, INC.,
an Illinois corporation
By:
Its:
16
UponorAnnex
Expansion
Presentation to the Economic Development Authority
April 9, 2015
Items for Consideration
UponorProposal in Brief
•
Financial Assistance Needed
•
Types of Assistance Requested
•
Tax Increment Financing
•
Deferred Forgivable Loan
•
UponorProposal
Uponor-leading provider of PEX tubing in North
•
America and Europe
PEX used for plumbing, fire sprinkler and radiant heating and
•
cooling systems
North American Headquarters are located in Apple
•
Valley -5925 148Street W.
th
Company is growing, needs more manufacturing
•
space
Proposing expansion of existing 36,000 sq. ft. former
•
bus garage
Expand building to 86,000 sq. ft. manufacturing and
•
office facility on 6-acre lot
Approximately $18 million in improvements and
•
equipment; over 80 additional new jobs
Location –14800 Everest Ave.
Aerial View
Proposed Project
Financial Assistance Request
Assistance needed for significant building
•
improvements and job creation
“But For” EDA and State assistance, project
•
would not proceed
Improvements would not be made
•
Jobs could not be added.
•
Assistance from DEED
•
Minnesota Investment Fund (MIF) –$500,000
•
DEED will also provide up to $1 million from Job
•
Creation Fund (already reviewed by City)
Assistance from EDA
•
Tax Increment Financing (TIF) -$504,000
•
Deferred Forgivable Loan -$800,000
•
Tax Increment Financing
Uponorrequested Tax Increment Financing (TIF)
•
to assist with development
Structure of TIF district:
•
Economic Development District
•
“Pay-as-you-go” District
•
Uponorprivately finances project
•
Increase in property value captured, and portion
•
returned to Uponor
District expires after 8 years
•
TIF requires Public Hearing per State law
•
Tax Increment Financing (Cont.)
Tax Increment Financing (Cont.)
Tax Increment Financing (Cont.)
Projected Tax Increment
Tax Increment Financing District No. 16
Anticipated per County Total
Prelim Estimate of (Per TIF Plan)
Value
Total Estimated Tax $ 560,000$1,215,000
Increment Revenues
(tax increment generated
by the district)
Estimated Tax Increment $ 560,000$1,215,000
Project Costs
(Paid from Tax Increment)
Total of Bonds to be issued$1,215,000
(max.amount –no bonding expected)
Total Estimated to be $504,000
Returned to Uponor(per County’s initial estimate–90% of available
increment)
Deferred Forgivable Loan
Apple Valley Economic Development Authority
•
to consider Deferred Forgivable Loan to assist
with building expansion costs
Assistance used towards extraordinary costs:
•
Improved stormwaterponds
•
Landscaping and gathering areas
•
Irrigation
•
Pathways
•
Will also assist with expansion that adds 50%
•
more manufacturing capacity
$800,000 from funds available to EDA
•
Deferred Forgivable Loan
Forgivable loan -
•
EDA reduces principal when
benchmarks are met:
75 full-time jobs within 3 years of occupancy.
•
Each job must pay a minimum of $15/hour
•
Forgivable loan is Business Subsidy per State law.
•
Requires Public Hearing.
•
Requested EDA Actions
Modifications to Master Development District
•
Hold public hearing and then act on resolution
•
Deferred Forgivable Loan
•
Hold public hearing and then act on resolution
•
Requested Actions -TIF
Modifications to Master Development Program:
1.Hold Public Hearing on Modifications to the Master
Development District
2.Adopt Resolution Approving Amendments to Master
Development Program for Master Development District,
Tax Increment Financing (TIF) Amendments,
Establishment of TIF District No. 16, and Approving the
Tax Increment Financing Plan and Development
Agreement
Requested Actions –
Business Subsidy
Deferred Forgivable Loan –Public Business Subsidy:
1.Hold Public Hearing
2.Adopt Resolution Supporting Business Subsidy Agreement
with Uponor, Inc.
Questions?