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HomeMy WebLinkAboutResolution - 2000-173 - Micro Dynamics Corporation, Relating to the Proposed Issuance of Revenue Bonds in the Aggregate Principal Amount not to Exceed $4,345,000 - 10/30/2000 CITY OF EDEN PRAIRM HENNEPIN COUNTY,MINNESOTA RESOLUTION NO.2000-173 RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF $2,035,000 VARIABLE RATE DEMAND INDUSTRIAL DEVELOPMENT REVENUE BONDS, SERIES 2000A AND $945,000 TAXABLE VARIABLE RATE DEMAND INDUSTRIAL DEVELOPMENT REVENUE BONDS, SERIES 2000B (SWB,L.L.C.PROJECT) AND $1,365,000 VARIABLE RATE DEMAND INDUSTRIAL DEVELOPMENT REVENUE BONDS, SERIES 2000 (MICRO DYNAMICS CORPORATION PROJECT) TO FINANCE A PROJECT BE IT RESOLVED by the City Council (the "Council') of the City of Eden Prairie,Minnesota(the"City"), as follows: 1. The Council has received a proposal from SWB, L.L.C., a Minnesota limited liability company (the "Company") and Micro Dynamics Corporation, a Minnesota corporation (the "Tenant") that the City undertake to finance a certain Project as herein described, pursuant to Minnesota Statutes, Sections 469.152 through 469.165 (the "Act"), through issuance by the City of its $2,035,000 Variable Rate Demand Industrial Development Revenue Bonds (SWB, L.L.C. Project), Series 2000A and $945,000 Taxable Variable Rate Demand Industrial Development Revenue Bonds (SWB, L.L.C. Project), Series 2000B (collectively, the "SWB Bonds") and its $1,365,000 Variable Rate Demand Industrial Development Revenue Bonds, Series 2000 (Micro Dynamics Corporation Project) (the "MD Bonds"). 2. It is proposed that,pursuant to a Loan Agreement dated as of November 1, 2000, between the City and the Company (the "SWB Loan Agreement"), the City loan the proceeds of the SWB Bonds to the Company to finance (i) the acquisition of land and existing approximately 50,000 square foot building located at 6201 Bury Drive in the City of Eden Prairie and (ii) the renovation of the building and pursuant to a Loan Agreement dated as of November 1,2000 between the City and the Tenant(the"MD Loan Agreement"),the City loan the proceeds of the MD Bonds to the Tenant to finance the acquisition and installation of electronics manufacturing equipment. The basic payments to be made by the Company under the SWB Loan Agreement and the Tenant under the MD Loan Agreement are fixed so as to produce revenue sufficient to pay the principal of, premium, if any, and interest on the SWB Bonds and the MD Bonds,respectively,when due. It is further proposed that the City assign its rights to the basic payments and certain other rights under (a) the SWB Loan Agreement to U. S. Bank Trust National Association in St. Paul, Minnesota (the "Trustee") as security for payment of the SWB Bonds under an Indenture of Trust dated as of November 1, 2000 (the "SWB Indenture") and(b) under the MD Loan Agreement to the Trustee as security for payment of the MD Bonds under an 1215140.2 1 Indenture of Trust dated as of November 1, 2000 (the "MD Indenture"). Payment of the SWB Bonds and MD Bonds are each initially secured by an irrevocable Letter of Credit to be issued by U.S. Bank National Association in favor of the Trustee in an amount equal to the principal amount of the SWB Bonds and the MD Bonds, respectively, plus certain additional interest thereon. The SWB Bonds and the MD Bonds are intended to be sold by U.S. Bancorp Piper Jaffray Inc. (the "Underwriter"),pursuant to two Bond Purchase Agreements both dated as of the date of closing among the City, the Company and the Underwriter(the "Purchase Agreements") and two Official Statements both dated as of the date of closing(the "Official Statements"). 3. Forms of the following documents have been presented to the City and are proposed to be executed by the City in connection with issuance of the SWB Bonds and the MD Bonds: (a) The SWB Loan Agreement (b) The MD Loan Agreement (c) The SWB Indenture (d) The MD Indenture (e) The Purchase Agreement(s) The use of the Official Statements is hereby authorized, but the City has not participated in the preparation of or reviewed, and will not participate in the preparation of or review of,the Official Statements and has not made and will not make any independent investigation of the facts and statements provided therein; accordingly,the City assumes no responsibility with respect thereto, including without limitation as to matters relating to the accuracy, completeness or sufficiency of the Official Statements. 4. It is hereby found, determined and declared that: (a) it is desirable that the SWB Bonds and the MD Bonds be issued by the City upon the terms set forth in the SWB Indenture and the MD Indenture, respectively; (b) the basic payments under the SWB Loan Agreement and the MD Loan Agreement, respectively, are fixed to produce revenue sufficient to provide for the prompt payment of principal of and interest on the SWB Bonds and the MD Bonds issued under the SWB Indenture and the MD Indenture, respectively, when due, and the SWB Loan Agreement, the MD Loan Agreement, the SWB Indenture and the MD Indenture also provide that the Company and the Tenant, respectively, are required to pay all expenses of the operation and maintenance of the Project(as defined in such documents), including, but without limitation, adequate insurance thereon and insurance against all liability for injury to persons or property arising from the operation thereof, and all taxes and special assessments levied upon or with respect to the Project Premises and payable during the term of the SWB Loan Agreement, the MD Loan Agreement, the SWB Indenture and the MD Indenture; and (c) under the provisions of Minnesota Statutes, Section 469.155, and as provided in the SWB Loan Agreement, the MD Loan Agreement, the SWB Indenture and the MD Indenture, the SWB Bonds and the MD Bonds and the interest thereon and 1215140.2 2 4 any penalty, charge or premium, or any amounts payable thereunder, however designated, due thereunder are payable by the City solely from the revenues and proceeds derived from the SWB Loan Agreement and the MD Loan Agreement, respectively, do not constitute a debt of the City within the meaning of any constitutional or statutory limitation, are not payable from or a charge upon any funds of the City other than the revenues and proceeds pledged by the City to the payment thereof, and do not give rise to a pecuniary liability of the City nor of any of its officers, agents, or employees, and no holder of the SWB Bonds or the MD Bonds shall ever have the right to compel any exercise of the taxing power of the City to pay the SWB Bonds or the MD Bonds or the interest thereon or any penalty, charge or premium or any amounts payable thereunder, however designated, due thereunder, or to enforce payment thereof against any property of the City, and the SWB Bonds and the MD Bonds and the interest thereon and any penalty, charge or premium, or any amounts payable thereunder, however designated, do not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City and the agreement of the City to perform or cause the performance of the covenants and other provisions therein referred to shall be subject at all times to the availability of revenues or other funds furnished for such purpose in accordance with the SWB Loan Agreement and the MD Loan Agreement, respectively, sufficient to pay all costs of such performance or the enforcement thereof. The provisions of this paragraph 4 shall, for purposes of the SWB Bonds and the MD Bonds, be controlling and shall be given full force and effect, anything else to the contrary in the SWB Bonds and the MD Bonds notwithstanding. 5. Subject to the final approval of the City's counsel, the forms of the SWB Loan Agreement, the MD Loan Agreement, the SWB Indenture, the MD Indenture and the Purchase Agreements are approved substantially in the forms submitted and are hereby authorized to be executed in the name and on behalf of the City by the Mayor and City Manager. Any other documents and certificates necessary in connection with the issuance of the SWB Bonds and the MD Bonds are similarly authorized to be executed and delivered by the appropriate City officers. 6. The City shall proceed forthwith to issue its SWB Bonds and MD Bonds, in the form and upon the terms set forth in the SWB Indenture and the MD Indenture, respectively. The offer of the Underwriter to purchase the SWB Bonds and the NM Bonds for resale to accredited investors at par plus accrued interest to the date of delivery at the interest rate or rates specified in the SWB Indenture and MD Indenture, respectively, as of the date of issuance of the SWB Bonds and the MD Bonds at a rate not to exceed 10%per annum is hereby accepted. The Mayor and City Manager are authorized and directed to prepare and execute the SWB Bonds and the MD Bonds as prescribed in the SWB Indenture and MD Indenture, respectively, and to 3 deliver them to the Trustee for authentication and delivery to the Underwriter. 7. The officers of the City are authorized to prepare and furnish to the Underwriter certified copies of all proceedings and records of the City relating to the SWB Bonds and the MD Bonds, and such other affidavits and certificates as may be required to show the facts relating to the SWB Bonds and the MD Bonds as such facts appear from the books and records in the officers' custody and control or as otherwise known to them; and all such certified 1215140.2 3 copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the City as to the truth of all statements contained therein. 8. The approval hereby given to the various documents referred to above includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by the City officials authorized herein to execute said documents prior to their execution; and said City officials are hereby authorized to approve said changes on behalf of the City. The execution of any instrument by the appropriate officer or officers of the City herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. In the absence of the Mayor or City Manager, any of the documents authorized by this resolution to be executed may be executed by the Acting Mayor or Acting City Manager,respectively. PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF EDEN PRAIRIE,MINNESOTA, THIS 30'DAY OF OCTOB R,2000. Jean L.Harris,Mayor ATTEST: A � 4 katfileen Porta, City Clerk (Seal) 1215140.2 4