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08-28-2012 (WEDC) Minutes (03) Minutes Wylie Economic Development Corporation Board of Directors Meeting Tuesday, August 28, 2012 6:30 A.M. WEDC Offices—Conference Room 250 South Highway 78—Wylie, Texas CALL TO ORDER Announce the presence of a Quorum President Marvin Fuller called the meeting to order at 6:30 a.m. Board Members present were: Todd Wintters and John Yeager. Mitch Herzog arrived at 6:38. WEDC staff present was Executive Director Sam Satterwhite and Senior Assistant Gerry Harris. Ex-officio member Mindy Manson was present. CITIZEN PARTICIPATION There being no citizen participation, President Fuller proceeded to Action Items. ACTION ITEMS ITEM NO. 1 — Consider and act upon approval of the August 17, 2012 Minutes of the WEDC Board of Directors Meeting. MOTION: A motion was made by Todd Wintters and seconded by John Yeager to approve the August 17, 2012 Minutes of the WEDC Board of Directors Meeting. The WEDC Board voted 3 — FOR and 0 — AGAINST in favor of the motion. ITEM NO. 2 — Consider and act upon a Loan Agreement between the WEDC and Duel Products,Inc. Staff reported that all issues surrounding the IRS and the Bankruptcy court have been resolved. From the sales price Duel intended to satisfy its debt to the Comptroller and its lender who holds a first lien on the real property and improvements. After satisfying its debt to the Comptroller, Duel will still remain $12,000 short in satisfying its lender with the lender not interested in a partial release. Further, Duel is interested in exploring other opportunities to avoid bringing $12,000 to closing. Staff suggested to Duel that the WEDC may be interested in purchasing their facility and remaining %2 acre with Duel having the ability then to satisfy its remaining IRS debt. Duel was WEDC—Minutes August 28, 2012 Page 2 of 3 not interested based upon the WEDC's inability to provide an indefinite lease and their interest in retaining the real estate for a long term investment. Staff proposed that the WEDC increase the purchase price by $12,000 and take back a note from Duel at 4.5%for a 12 month period to be secured by the remaining real estate and improvements. The Board pointed out that should Duel become in default of the bankruptcy order the IRS could foreclose and the WEDC lien could be wiped out. With that, the WEDC would be increasing the purchase price by $12,000 with problematic collateral. Staff stated that the WEDC and Duel have been under contract since January 10, 2012 and that the continued delays and challenges obtaining releases from Duel's lender and the IRS presents the potential for not closing on the lot. Staff recommended that the WEDC Board of Directors authorize the Executive Director to increase the purchase price of the Duel tract by $12,000 and develop a loan agreement with the assistance of WEDC counsel in the amount of$12,000. The Board discussed three different solutions and directed staff to explore the options. First option would be for Duel to close on the purchase and negotiate with Duel's lender for a partial release of the $12,000 balance. The second option would be for the WEDC to purchase the note from the bank and have Duel pay the note to the WEDC after receiving clear title for the %2 acre the WEDC has been attempting to purchase. The third option would be for the WEDC to increase the current $125,000 purchase price on the 1/2 acre to include the $12,000 and set up a loan by which Duel Products would repay the $12,000 in 12 months at 4.5%interest. MOTION: A motion was made by Todd Wintters and seconded by Mitch Herzog authorizing the Executive Director to pursue alternate financing options in order to finalize the purchase of 1/2 acre from Duel Products. The WEDC Board voted 4—FOR and 0—AGAINST in favor of the motion. EXECUTIVE SESSION The WEDC Board recessed into Closed Session at 7:08 a.m. in compliance with Section 551.001 et.seq. Texas Government Code to wit: Section 551.072 (Real Property) of the Local Government Code, Vernon's Texas Code Annotated(Open Meetings Act). • Consider issue surrounding a Real Estate Sales Contract between the WEDC and Jerry and Carmie Randack. Section 551.087 (Economic Development) of the Local Government Code, Vernon's Texas Code Annotated(Open Meetings Act). • Consider issues surrounding a Performance Agreement between the WEDC and Woodbridge Crossing, L.P. WEDC —Minutes August 28, 2012 Page 3 of 3 RECONVENE INTO OPEN MEETING The WEDC Board of Directors reconvened into open session at 7:39 a.m. and took no action. ADJOURNMENT With no further business, President Fuller adjourned the WEDC Board meeting at 7:40 a.m. -. 11/01.141 Marvin Fuller,President ATTEST: Samuel Satterwhite,Director