2023-011
CH135-62-848620.v1
AUTHORIZING RESOLUTION WITH NOTE
CHANHASSEN ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. 2023-01
RESOLUTION APPROVING THE ISSUANCE OF, AND
PROVIDING THE FORM, TERMS, COVENANTS AND
DIRECTIONS FOR THE ISSUANCE OF ITS TAXABLE TAX
INCREMENT REVENUE NOTE, SERIES 2023A IN AN
AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED
$3,065,000
BE IT RESOLVED BY the Chanhassen Economic Development Authority (the “EDA”), as
follows:
Section 1. Authorization; Award of Sale.
1.01. Authorization. The EDA has heretofore approved the establishment of Tax
Increment Financing District No. 12 (the “TIF District”) within the Downtown Chanhassen
Redevelopment Project Area (“Redevelopment Project”) and has adopted a tax increment
financing plan for the purpose of financing certain improvements within the Redevelopment
Project.
Pursuant to Minnesota Statutes, Section 469.178, the EDA is authorized to issue and sell
its bonds for the purpose of financing a portion of the public development costs of the Minimum
Improvements and Development Property in the Redevelopment Project. The bonds are payable
from all or any portion of revenues derived from the Minimum Improvements and the
Development Property in the TIF District and pledged to the payment of the bonds. The EDA
hereby finds and determines that it is in the best interests of the EDA that it issue and sell its taxable
Tax Increment Revenue Note, Series 2023A (the “Note”), in the aggregate principal amount of
$3,065,000, for the purpose of financing certain public costs of the Redevelopment Project.
1.02. Agreement Approved; Issuance, Sale and Terms of the Note. The EDA has
previously approved the Contract for Private Development (the “Agreement”) between the EDA
and Lakes at Chanhassen, LLC, a Minnesota limited liability company (the “Owner”), and
authorized the Executive Director and President to execute the Agreement. Pursuant to the
Agreement, the Note will be issued to the Owner. The Note will be dated as of the date of delivery
and will bear no interest. In exchange for the EDA’s issuance of the Note to the Owner, the Owner
will pay certain costs related to the Minimum Improvements (the Qualifying Costs, as defined in
the Agreement) pursuant to Section 3.2 of the Agreement. The Note will be delivered in the
principal amount of $3,065,000 for reimbursement of the Owner’s costs in accordance with the
terms of Sections 3.2 and 3.3 of the Agreement.
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Section 2. Form of Note. The Note will be in substantially the following form, with
the blanks to be properly filled in and the principal amount and payment schedule adjusted as of
the date of issue:
UNITED STATE OF AMERICA
STATE OF MINNESOTA
CARVER COUNTY
CHANHASSEN ECONOMIC DEVELOPMENT AUTHORITY
No. R-1 $3,065,000
TAXABLE TAX INCREMENT REVENUE NOTE
SERIES 2023A
Date
Rate of Original Issue
Zero% __________
The Chanhassen Economic Development Authority (the “EDA”), for value received,
certifies that it is indebted and hereby promises to pay to Lakes at Chanhassen, LLC, or registered
assigns (the “Owner”), the principal sum of $3,065,000 with no interest thereon, as and to the
extent set forth herein.
1. Payments. Principal (“Payments”) will be paid on August 1, 2023, and each
February 1 and August 1 thereafter until the earlier of payment in full or February 1, 2042
(“Payment Dates”), in the amounts and from the sources set forth in Section 3 herein.
Payments are payable by mail to the address of the Owner or any other address as the
Owner may designate upon 30 days written notice to the EDA. Payments on this Note are payable
in any coin or currency of the United States of America which, on the Payment Date, is legal tender
for the payment of public and private debts.
2. No Interest. No interest will be paid on this Note.
3. Available Tax Increment. Payments on this Note are payable on each Payment
Date in the amount of and solely payable from “Available Tax Increment,” which will mean, on
each Payment Date, 90 percent of the Tax Increment attributable to the Development Property and
Minimum Improvements (as defined in the Agreement) and paid to the EDA by Carver County in
the six months preceding the Payment Date, all as the terms are defined in the Contract for Private
Development between the EDA and Owner dated as of April 6, 2021 (the “Agreement”).
Available Tax Increment will not include any Tax Increment if, as of any Payment Date, there is
an uncured Event of Default by the Owner under the Agreement.
The EDA will have no obligation to pay principal on this Note on each Payment Date from
any source other than Available Tax Increment, and the failure of the EDA to pay the entire amount
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of principal on this Note on any Payment Date will not constitute a default hereunder as long as
the EDA pays principal to the extent of Available Tax Increment. The EDA will have no obligation
to pay unpaid balance of principal that may remain after the final Payment on February 1, 2042.
4. Optional Prepayment. The principal sum payable under this Note is pre-payable in
whole or in part at any time by the EDA without premium or penalty. No partial prepayment will
affect the amount or timing of any other regular payment otherwise required to be made under this
Note.
5. Suspension of Payment for Default. At the EDA’s option, the EDA’s obligation to
make any payments under this Note will be suspended upon the occurrence of an Event of Default
on the part of the Developer as defined in Section 8.1 of the Agreement, but only if the Event of
Default has not been cured in accordance with Section 8.2 of the Agreement.
6. Nature of Obligation. This Note is a single note in the total principal amount of
$3,065,000 issued to aid in financing certain public costs of a Redevelopment Project undertaken
by the EDA pursuant to Minnesota Statutes, Sections 469.001 through 469.047, as amended, and
is issued pursuant to an authorizing resolution (the “Resolution”) duly adopted by the EDA on
March 13, 2023 pursuant to and in full conformity with the Constitution and laws of the State of
Minnesota, including Minnesota Statutes, Sections 469.174 to 469.179, as amended. This Note is
a limited obligation of the EDA which is payable solely from Available Tax Increment pledged to
the payment hereof under the Resolution. This Note will not be deemed to constitute a general
obligation of the State of Minnesota or any political subdivision thereof, including, without
limitation, the EDA or the city of Chanhassen. Neither the State of Minnesota, nor any political
subdivision thereof will be obligated to pay the principal of this Note or other costs incident hereto
except out of Available Tax Increment, and neither the full faith and credit nor the taxing power
of the State of Minnesota or any political subdivision thereof is pledged to the payment of the
principal of this Note or other costs incident hereto.
7. Estimated Tax Increment Payments. Any estimates of Tax Increment prepared by
the EDA or its financial advisors in connection with the TIF District or the Agreement are for the
benefit of the EDA, and are not intended as representations on which the Owner may rely.
THE EDA MAKES NO REPRESENTATION OR WARRANTY THAT THE
AVAILABLE TAX INCREMENT WILL BE SUFFICIENT TO PAY THE PRINCIPAL OF
THIS NOTE.
8. Registration and Transfer. As provided in the Resolution, and subject to certain
limitations set forth herein, this Note is issuable only as a fully registered note without coupons.
This Note is transferable upon the books of the EDA kept for that purpose at the principal office
of the Executive Director of the EDA as Registrar, by the Owner hereof in person or by the
Owner’s attorney duly authorized in writing, upon surrender of this Note together with a written
instrument of transfer satisfactory to the EDA, duly executed by the Owner. Upon the transfer or
exchange and the payment by the Owner of any tax, fee, or governmental charge required to be
paid by the EDA with respect to the transfer or exchange, there will be issued in the name of the
transferee a new Note of the same aggregate principal amount and maturing on the same dates.
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This Note may be transferred, assigned or pledged without the approval of the EDA;
provided that this Note will not be transferred to any person other than an affiliate, or other related
entity, of the Owner unless the EDA has been provided with an investment letter in a form
substantially similar to the investment letter submitted by the Owner or a certificate of the
transferor, in a form satisfactory to the EDA, that the transfer is exempt from registration and
prospectus delivery requirements of federal and applicable state securities laws. Notwithstanding
anything to the contrary in this Note, in no event will a lender providing funds to the Developer
and taking an assignment of the Note as security for such funds be required to sign an investment
letter at either the time of execution of an assignment or transfer of the Note as a result of the
assignment.
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 exist, to happen, and to be
performed in order to make this Note a valid and binding limited obligation of the EDA according
to its terms, have been done, do exist, have happened, and have been performed in due form, time
and manner as so required.
IN WITNESS WHEREOF, the board of commissioners of the Chanhassen Economic
Development Authority, has caused this Note to be executed with the manual signatures of its
President and Executive Director, all as of the Date of Original Issue specified above.
CHANHASSEN ECONOMIC
DEVELOPMENT AUTHORITY
Elise Ryan, President Laurie Hokkanen, Executive Director
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REGISTRATION PROVISIONS
The ownership of the unpaid balance of the within Note is registered in the bond register
of the Executive Director of the EDA, in the name of the person last listed below.
Date of Registration Registered Owner Signature of EDA Executive Director
March ___, 2023 Lakes at Chanhassen, LLC
350 Highway 7, Suite 218
Excelsior, MN 55331
Attn: Todd M. Simning
Federal Tax ID #85-4235644
[End of Form of Note]
Section 3. Terms, Execution and Delivery.
3.01. Denomination, Payment. The Note will be issued as a single typewritten note
numbered R-1.
The Note will be issuable only in fully registered form. Principal of the Note will be
payable by check or draft issued by the Registrar described herein.
3.02. Dates. Principal of the Note will be payable by mail to the owner of record thereof
as of the close of business on the fifteenth day of the month preceding the Payment Date, whether
or not the day is a business day.
3.03. Registration. The EDA hereby appoints the Executive Director to perform the
functions of registrar, transfer agent and paying agent (the “Registrar”). The effect of registration
and the rights and duties of the EDA and the Registrar with respect thereto will be as follows:
(a) Register. The Registrar will keep at her office a bond register in which the Registrar
will provide for the registration of ownership of the Note and the registration of transfers and
exchanges of the Note.
(b) Transfer of Note. Upon surrender for transfer of the Note duly endorsed by the
registered owner thereof or accompanied by a written instrument of transfer, in form reasonably
satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly
authorized by the registered owner in writing, the Registrar will authenticate and deliver, in the
name of the designated transferee or transferees, a new Note of a like aggregate principal amount
and maturity, as requested by the transferor. Notwithstanding the foregoing, the Note will not be
transferred to any person other than an affiliate, or other related entity, of the Owner unless the
EDA has been provided with an investment letter in a form substantially similar to the investment
letter submitted by the Owner or a certificate of the transferor, in a form satisfactory to the EDA,
that the transfer is exempt from registration and prospectus delivery requirements of federal and
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applicable state securities laws. The Registrar may close the books for registration of any transfer
after the fifteenth day of the month preceding each Payment Date and until the Payment Date.
(c) Cancellation. The Note surrendered upon any transfer will be promptly cancelled
by the Registrar and thereafter disposed of as directed by the EDA.
(d) Improper or Unauthorized Transfer. When the Note is presented to the Registrar
for transfer, the Registrar may refuse to transfer the same until she is satisfied that the endorsement
on the Note or separate instrument of transfer is legally authorized. The Registrar will incur no
liability for her refusal, in good faith, to make transfers which she, in her judgment, deems
improper or unauthorized.
(e) Persons Deemed Owners. The EDA and the Registrar may treat the person in
whose name the Note is at any time registered in the bond register as the absolute owner of the
Note, whether the Note is overdue or not, for the purpose of receiving payment of, or on account
of, the principal of the Note and for all other purposes, and all the payments so made to any
registered owner or upon the owner’s order will be valid and effectual to satisfy and discharge the
liability of the EDA upon the Note to the extent of the sum or sums so paid.
(f) Taxes, Fees and Charges. For every transfer or exchange of the Note, the Registrar
may impose a charge upon the owner thereof sufficient to reimburse the Registrar for any tax, fee,
or other governmental charge required to be paid with respect to the transfer or exchange.
(g) Mutilated, Lost, Stolen or Destroyed Note. In case the Note becomes mutilated or
is lost, stolen, or destroyed, the Registrar will deliver a new Note of like amount, maturity dates
and tenor in exchange and substitution for and upon cancellation of the mutilated Note or in lieu
of and in substitution for the Note lost, stolen, or destroyed, upon the payment of the reasonable
expenses and charges of the Registrar in connection therewith; and, in the case the Note lost, stolen,
or destroyed, upon filing with the Registrar of evidence satisfactory to it that the Note was lost,
stolen, or destroyed, and of the ownership thereof, and upon furnishing to the Registrar of an
appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both the
EDA and the Registrar will be named as obligees. The Note so surrendered to the Registrar will
be cancelled by her and evidence of the cancellation will be given to the EDA. If the mutilated,
lost, stolen, or destroyed Note has already matured or been called for redemption in accordance
with its terms, it will not be necessary to issue a new Note prior to payment.
3.04. Preparation and Delivery. The Note will be prepared under the direction of the
Executive Director and will be executed on behalf of the EDA by the signatures of its President
and Executive Director. In case any officer whose signature appears on the Note ceases to be the
officer before the delivery of the Note, the signature will nevertheless be valid and sufficient for
all purposes, the same as if the officer had remained in office until delivery. When the Note has
been so executed, it will be delivered by the EDA to the Owner following the delivery of the
necessary items delineated in Section 3.3 of the Agreement.
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Section 4. Security Provisions.
4.01. Pledge. The EDA hereby pledges to the payment of the principal of the Note all
Available Tax Increment as defined in the Note. Available Tax Increment will be applied to
payment of the principal of the Note in accordance with the terms of the form of Note set forth in
Section 2 of this resolution.
4.02. Bond Fund. Until the date the Note is no longer outstanding and no principal
thereof (to the extent required to be paid pursuant to this resolution) remains unpaid, the EDA will
maintain a separate and special “Bond Fund” to be used for no purpose other than the payment of
the principal of the Note. The EDA irrevocably agrees to appropriate to the Bond Fund in each
year Available Tax Increment. Any Available Tax Increment remaining in the Bond Fund will be
transferred to the EDA’s account for the TIF District upon the payment of all principal to be paid
with respect to the Note.
Section 5. Certification of Proceedings.
5.01. Certification of Proceedings. The officers of the EDA are hereby authorized and
directed to prepare and furnish to the Owner of the Note certified copies of all proceedings and
records of the EDA, and the other affidavits, certificates, and information as may be required to
show the facts relating to the legality and marketability of the Note as the same appear from the
books and records under their custody and control or as otherwise known to them, and all the
certified copies, certificates, and affidavits, including any heretofore furnished, will be deemed
representations of the EDA as to the facts recited therein.
Section 6. Effective Date. This resolution will be effective upon execution by the President
and Executive Director following authorization by the board of commissioners of the EDA.
Adopted by the board of commissioners of the Chanhassen Economic Development Authority,
this 13th day of March, 2023.
Elise Ryan, President
Laurie Hokkanen, Executive Director
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