HomeMy WebLinkAboutResolution - 78-155 - Giving Preliminary Approval to Proposed Industrial Development Project, Authorizing Submission to Commissioner of Securities and Authorizing Preparation of Documents for Random Specialties, Inc. (The Allen Partnership) - y
RESOLUTION GIVING PRELIMINARY APPROVAL TO A
PROPOSED INDUSTRIAL DEVELOPMENT PROJECT TO BE
CONSTRUCTED AND FINANCED UNDER THE MUNICIPAL
INDUSTRIAL DEVELOPMENT ACT, AUTHORIZING THE
SUBMISSION OF AN APPLICATION TO THE COMMISSIONER
OF SECURITIES FOR APPROVAL THEREOF AND
AUTHORIZING THE PREPARATION OF DOCUMENTS AND
MATERIALS IN CONNECTION WITH THE PROJECT
BE IT RESOLVED by the City Council of the City of Eden
Prairie, Minnesota, as follows:
1. There has been presented to this Council a proposal
that the City undertake a project pursuant to the Minnesota Munici-
pal Industrial Development Act, Chapter 474, Minnesota Statutes,
consisting of the acquisition of land and construction thereon of a
combination light manufacturing-office building (the "Project" ) in
the City to be used by Random Specialties, Inc. (the "Company" ) .
Under the proposal, a Minnesota partnership consisting of Messrs.
John W. Allen, Paul W. -Allen and Keith P. Allen (the "Allen Partner-
ship" ) will enter into a loan agreement with the City whereby the
Allen Partnership agrees to construct the Project and the City
agrees to issue up to approximately $775, 000. 00 of Industrial
• Development Revenue Bonds (the "Bonds" ) pursuant to the Act to
finance the Project. The Bonds will be issued to an institutional
investor or investors in a tax exempt private placement mortgage
financing whereby the Bonds will be secured by a mortgage on the
Project. The Allen Partnership will retain title to the Project
and the loan agreement will require the Allen Partnership to pay
amounts sufficient to pay the principal of and interest on any
Bonds issued. The Allen Partnership will lease the Project to the
Company -under lease terms sufficient to provide for the payment of
principal of and interest on the Bonds. The interest of the Allen
Partnership in the lease will be assigned to the bondholders as
security for, the Bonds. The City will assign its interest in the
loan agreement to the bondholders to secure the Bonds. The Bonds
will be issued in accordance with the Act, and will provide that
the Bonds are payable solely from amounts received by the City
pursuant to the loan agreement and other property pledged to their
payment. The Bonds will not be a general obligation of the City or
be payable from any other property or funds of the City.
2. There has also been presented to this Council a form
of Application to the Commissioner of Securities for approval of
the Project setting forth the estimated costs of the Project and
the increased employment and payrolls to result therefrom. It is
hereby found, determined and declared that the purpose of the
Project is and the effect thereof will be to promote the public
welfare by the attraction, encouragement and development of
economically sound industry and commerce; the development of
1
industry to use the available resources of the community, in order
to retain the benefit of its existing investment in educational and
public service facilities; and the more intensive development of
land available in the area to provide an adequate, tax base to
finance the increase in the amount and cost of governmental services
provided by the city, the county and the school district in which .
the city is located.
3. The Project is hereby given preliminary approval by
the City, subject to (i) approval of. the Project by the Minnesota
Commissioner of Securities and (ii) approval of this Council, the
Allen Partnership, the Company and the institutional investor or
investors of the ultimate details of the Project and the terms of
the Bonds.
4. The Company is, undertaking to make arrangements with
institutional investors for the purchase of the Bonds. Upon
receipt of a letter of intent to purchase the Bonds, the Mayor,
City Manager and City Clerk are hereby authorized and directed to
submit an Application to the Commissioner of Securities for
approval of the Project, substantially in the form presented to
this meeting, together with the letter of intent for the purchase
of the Bonds necessary to complete such Application. The Mayor,
City Manager and City Clerk and other officers, employees and
agents of the City are hereby authorized to provide the Commis-
sioner of Securities with such preliminary information as he may
request.
5. The Company has agreed to pay any and all costs
incurred by the City in connection with the Project whether or not
the Project is approved by the Commissioner of Securities; whether
or not the Project is carried to completion; and whether or not the
Bonds or operative instruments are executed.
6. The Company and the Allen Partnership are hereby
authorized to enter into such contracts as may be necessary for the
construction of the Project by any means available to it and in the
manner it determines without advertisement for bids as may be
required for the construction or acquisition of other municipal
facilities.
�Zllwocw
Mayor
Attest:
City lerk