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EXTRACT OF MINUTES OF MEETING <br /> OF THE CITY COUNCIL OF THE <br /> CITY OF PEQUOT LAKES, MINNESOTA <br /> HELD: December 18, 2007 <br /> Pursuant to due call and notice thereof, a meeting of the City Council of the City of <br /> Pequot Lakes, Crow Wing County, Minnesota, was duly called and held at the City Hall in said <br /> City on Tuesday, the 18th day of December, 2007, at 6:30 o'clock p.m. <br /> The following members were present: Mayor Malecha, Council Members Nagel, Ryan, <br /> Sjoblad, and Oraskovich <br /> and the following were absent: None <br /> Member Sjoblad introduced the following resolution and moved its adoption: <br /> RESOLUTION 07-35 RECOGNIZING AN OBLIGATION <br /> A. WHEREAS, on August 13, 2007, the City of Pequot Lakes, Minnesota (the <br /> "City") and Lonesome Real Estate, LLC (the "Developer") entered into a Purchase Agreement <br /> (as amended from time to time, the "Purchase Agreement") providing for the City's conveyance <br /> and financing of certain real property (the "Development Property") in connection with the <br /> construction of an approximately 27,200 square foot manufacturing facility to be constructed by <br /> the Developer in the City's industrial park (the "Project"). <br /> B. WHEREAS, the Development Property purchased by the Lonesome Cottages had <br /> a market value of $209,400 as evidenced by the sale of similar real property in the City's <br /> industrial park. The Developer paid the City $46,000 in cash and has signed a note for an <br /> additional $100,000 to be paid over time. <br /> C. WHEREAS, the Purchase Agreement did not reflect that the City would be <br /> paying a portion of the Developer's purchase price (i.e. the difference between the $209,400 <br /> value and the $146,000 paid or to be paid by the Developer) from tax increments generated by <br /> the City's TIF District 1-13. However, the TIF Plan for TIF District 1-13 provided for <br /> reimbursing the City for the $63,400 difference through tax increments generated by TIF District <br /> 1-13 and the City Council adopted a "Resolution Authorizing an Interfund Loan for Advance of <br /> Certain Costs in Connection with Tax Increment Financing District no. 1-13" approving up to <br /> $84,900 from the Business Park Fund to allow for the repayment of, in part, the write-down of <br /> the cost of the Development Property. <br /> NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Pequot <br /> Lakes, Minnesota, as follows: <br /> 2118717v1 <br />