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HomeMy WebLinkAboutResolution - 96-23 - Challenge Printing Industrial Development Revenue Bonds - 02/06/1996 RESOLUTION NO. 96 - 23 RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF $1, 340, 000 VARIABLE RATE DEMAND INDUSTRIAL DEVELOPMENT REVENUE BONDS, SERIES 1996 (CHALLENGE PRINTING, INC. PROJECT) TO FINANCE A PROJECT BE IT RESOLVED by the City Council of the City of Eden Prairie, Minnesota (the "Issuer") , as follows : 1. The Issuer has received a proposal from Challenge Printing, Inc. (the "Company") that the Issuer undertake to finance a certain Project as herein described, and pursuant to Minnesota Statutes, Sections 469 .152 through 469 .1651 (the "Act") , through issuance by the Issuer of its $1, 340, 000 Variable Rate Demand Industrial Development Revenue Bonds, Series 1996 (Challenge Printing, Inc. Project) (the "Bonds") . 2 . It is proposed that, pursuant to a Loan Agreement dated as of February 1, 1996, between the Issuer and the Company (the "Loan Agreement") , the Issuer loan the proceeds of the Bonds to the Company to finance the acquisition and installation of commercial printing equipment (the "Project") in the manufacturing facility located at 7500 Golden Triangle Drive, Eden Prairie, Minnesota which the Company leases from Robert Lothenbach. The basic payments to be made by the Company under the Loan Agreement are fixed so as to produce revenue sufficient to pay the principal of, premium, if any, and interest on the Bonds when due. It is further proposed that the Issuer assign its rights to the basic payments and certain other rights under the Loan Agreement to First Trust National Association, in St. Paul, Minnesota (the "Trustee") as security for payment of the Bonds under an Indenture of Trust dated as of February 1, 1996 (the "Indenture") . Payment of the Bonds is initially secured by an irrevocable Letter of Credit to be issued by Norwest Bank Minnesota, National Association in favor of the Trustee in an amount equal to the principal amount of the Bonds plus a certain amount of interest thereon. The Bonds are intended to be privately placed with accredited investors by Norwest Bank Minnesota, National Association (the "Placement Agent") in accordance with a Bond Placement Agreement dated as of closing among the Issuer, the Company and the Placement Agent (the "Placement Agreement") and pursuant to a Private Placement Memorandum dated as of the date of closing (the "Memorandum") . 3 . Pursuant to the preliminary approval of the Issuer, forms of the following documents have been submitted to the Issuer for approval: 741763.1 (a) The Loan Agreement, (b) The Indenture, and (c) Placement Agreement. The use of the Memorandum is hereby approved, but the Issuer takes no responsibility for any of the information contained therein. 4 . It is hereby found, determined and declared that: (a) it is desirable that the Bonds be issued by the Issuer upon the terms set forth in the Indenture; (b) the basic payments under the Loan Agreement are fixed to produce revenue sufficient to provide for the prompt payment of principal of, premium, if any, and interest on the Bonds issued under the Indenture when due, and the Loan Agreement and Indenture also provide that the Company is required to pay all expenses of the operation and maintenance of the Project, 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 Loan Agreement and Indenture; and (c) under the provisions of Minnesota Statutes, Section 469 .155, and as provided in the Loan Agreement and Indenture, the Bonds and the interest thereon and any penalty, charge or premium, or any amounts payable thereunder, however designated, due thereunder are payable by the Issuer solely from the revenues and proceeds derived from the Loan Agreement, do not constitute a debt of the Issuer within the meaning of any constitutional or statutory limitation, are not payable from or a charge upon any funds of the Issuer other than the revenues and proceeds pledged by the Issuer to the payment thereof, and do not give rise to a pecuniary liability of the Issuer nor of any of its officers, agents, or employees, and no holder of the Bonds shall ever have the right to compel any exercise of the taxing power of the Issuer to pay the 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 Issuer, and the 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 Issuer and the agreement of the Issuer 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 741763.1 2 furnished for such purpose in accordance with the Loan Agreement, sufficient to pay all costs of such performance or the enforcement thereof. The provisions of this paragraph shall, for purposes of the Bonds, be controlling and shall be given full force and effect, anything else to the contrary in the Bonds notwithstanding. 5 . Subject to the final approval of Issuer' s counsel the forms of the Loan Agreement, Indenture and Placement Agreement and exhibits thereto are approved substantially in the form submitted. The Loan Agreement, Indenture and Placement Agreement are directed to be executed in the name and on behalf of the Issuer by the Mayor and the City Manager. Any other documents and certificates necessary to the transaction described above shall be executed and delivered by the appropriate Issuer officials . Copies of all of the documents necessary to the transaction herein described shall be delivered, filed and recorded as provided herein and in the Loan Agreement, Indenture and Placement Agreement. G . The Issuer shall proceed forthwith to issue its Bonds, in the form and upon the terms set forth in the Indenture. The offer of the Placement Agent to place the Bonds for sale to accredited investors at par plus accrued interest to the date of delivery at the interest rate or rates specified in the Indenture as of the date of issuance of the Bonds at a rate not to exceed 100 per annum is hereby accepted. The Mayor and City Manager are authorized and directed to prepare and execute the Bonds as prescribed in the Indenture and to deliver them to the Trustee for authentication and delivery to the Placement Agent. 7 . The Mayor and City Manager and other members of the City are authorized and directed to prepare and furnish to the Placement Agent certified copies of all proceedings and records of the Issuer relating to the Bonds, and such other affidavits and certificates as may be required to show the facts relating to the legality of the 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 copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the Issuer 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 Issuer' s counsel and the officials authorized herein to execute said documents prior to their execution; and said officials are hereby authorized to approve said changes on behalf of the Issuer. The execution of any instrument by the appropriate officer or officers of the Issuer herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. In the absence 741763.1 3 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 designee of the City Manager, respectively. Adopted: February 6, 19 Mayor Attest Yoe—), Clerk (SEAL) 741763.1 4 STATE OF MINNESOTA COUNTY OF HENNEPIN CITY OF EDEN PRAIRIE I, the undersigned, being the duly qualified and acting Clerk of the City of Eden Prairie, Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of minutes with the original thereof on file in my office, and that the same is a full, true and complete transcript of the minutes of a meeting of the City Council of said City of Eden Prairie duly called and held on the date therein indicated, insofar as such minutes relate to the authorization of the issuance of the $1, 340, 000 Variable Rate Demand Industrial Development Revenue Bonds, Series 1996 (Challenge Printing, Inc. Project) . WITNESS my hand and the seal of said City of Eden Prairie this day of February, 1996. Cl (SEAL) 741763.1 5