Revitalization Commission Agenda and Packet 2014 10 13

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SUBJECT: DATE: RESOLUTION 14 -02 — LRC TIF BOND OCTOBER 13, 2014 PAGE 3 OF 4 Cooperation Agreement and the costs under the 2012 Cooperation Agreement for funding the South Street Gateway. Payments of principal and interest will be made on each December 1 with the available Pledged Revenues. Should Pledged Revenues not be sufficient to pay accrued interest for the given year, it is not an event of default. Any unpaid interest will be compounded on each December 1. Should any unpaid interest or principal remain at the maturity date (December 1, 2033) of the bonds, such amounts will be discharged. After seven years, the LRC has the option to redeem all or a portion of the bonds without paying a premium. Bond Purchase Agreement This agreement outlines the funding provisions between the LRC and the initial purchaser of the Bonds, DFP, LLC (the "Purchaser "), an entity controlled by DELO. The agreement outlines that the LRC agrees to issue and Purchaser agrees to buy bonds up to $4,500,000. The Initial advance is expected to be $700,000 and additional advances will happen as needed in $1,000,000 minimum increments to finance the infrastructure. LRC commits to make advance requests in amounts sufficient to reimburse the Developer for Project Costs. After all the advances are made on the bonds the Purchaser intends to sell or transfer the bonds among the members of DFP, LLC. in minimum denominations of $500,000. Paying Agent Agreement This agreement between the LRC and U.S. Bank makes U.S. Bank the Registrar and Paying Agent for the TIF bonds. U.S. Bank will be in charge of receiving funds from the LRC to make payments on the bonds each December 1, make the appropriate payments to the bond holders, calculate and document earned interest, and make principal payments to the bond holders when funds are available. Construction Fund Agreement This agreement among the City, LRC, DFP LLC, and U.S. Bank, as escrow agent, outlines the funding of the Construction Fund, which is an escrow account at U.S. Bank that will be drawn upon as payment for construction work is needed. Funds for the Construction Fund will come from three sources; 1) the TIF Bond proceeds, 2) City funds for the Drainage Line, and 3) funds from the Developer needed to complete the construction project or provide the construction financial guarantee funds required by the City. This agreement also outlines the items needed to make a draw on the funds. Items needed to be provided are; (1) the amount of eligible Project Costs to be paid or reimbursed, separated into the amount to be paid from the Bond Proceeds and the amount to be paid from the Owner's Funds, (2) the address to which such funds are to be forwarded or appropriate wire instructions, (3) a brief description of the purpose of the payment, LOUISVILLE REVITALIZATION COMMISSION 10