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HomeMy WebLinkAboutResolution - 81-121 - MIDB's - Final Approval for S & D Properties - $350,000.00 - 07/07/1981 A RESOLUTION OF THE CITY OF EDE N PRAIRIE, MI NNESOTA, AUTHORIZING A PROJECT OF S & D PROPERTIES UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT AND THE SALE AND ISSUANCE OF A COMMERCIAL DEVELOPMENT REVENTTE BOND TO FINANCE THE PROJECT, SECURED BY AN ASSIGNMENT OF REVENUES UNDER A LOAN AGREEMENT AND MORTGAGE ON THE PROJECT, AND AUTHORIZING THE EXECUTION OF DOCUMENTS . BE IT RESOLVED by the City Council of the City of Eden Prairie, Minnesota ( the City ) , as follows : 1 . ) Authority The City is authorized by the Constitution and laws of the Stat—e of-Minnesota, including Chapter 474 , Minnesota Statutes , as amended ( the "Act" ) , to issue and sell its revenue bonds for the purpose of financing the cost of authorized projects and to enter into contracts necessary or convenient in the exercise of the powers granted by the Act . 2 . ) Authorization of Projects ; Documents Presented . Pursuant to application by S & D Properties ( the Borrower,-t i�i is Council proposes that the City shall issue and sell its City of Eden Prairie Commercial Development Revenue Bond (S & D Properties Project ) , in substantially the form set Forth in Exhibit A attached herL-to and made a part hereof ( the "Bond " ) , pursuant to the Act and shall lend the proceeds thereof to the Borrower to finance the cost of acquiring certain land and constructing a building and other improvements thereon located on Corporate Way in Edenvale Industrial Park , in the City , to be owned by the Borrower the " Project" ) . Forms of the following documents relating to the Bond ,d the Project have been submitted to the City Council and are now on file in the office of the City Clerk: ( a ) Loan Agreement ( the "Loan Agreement" ) between the City and the Borrower -,.hereby the City agrees to make a loan to the Borrower and the Borrower agrees to acquire, construct and improve the Project and to pay amounts sufficient to provide for the full and prompt payment of the principal of , prEmium , if any , and interest on the Bond ; ( b ) An Assignment of Loan Agreement ( the "Loan Assignment" ) made by the City in favor of First National Bank of Hopkins ( the "Lender" ) , whereby the City assigns to the Lender all of the City ' s rights under the Loan Agreement, with certain exceptions ; ( c ) A Mortgage and Security Agreement and Fixture Financing Statement ( the "Mortgage" ) made by the Borrower in favor of the Lender, whereby the Borrower grants to the Lender a f irst mortgage lien on certain land , the building and other improvements constructed and a f irst security interest in certain fixtures to be acquired ( the "Mortgaged Property" ) as security for the payment of the Bond ; ( d ) An Assignment of Leases ( the "Assignment" ) from the Borrower to the Lender, assigning the Borrower ' s interest in leases of the Project to the Lender as additional security for the Bond ; ( e ) A Construction Loan Agreement (the "Construction Loan Agreement" ) between the City , the Lender_ and the Borrower prescribing the terms and conditions under which the Lender will advance funds under the Bond and a related Construction Loan Disbursement Agreement ( the "Construction Loan Disbursement Agreement" ) between Title Insurance Company of Minnesota , or other qualified title company , the Borrower and the Lender, under which Title Insurance Company of Minnesota , or other qualified title company , agrees to perform certain duties on behalf of the Lender under the Construction Loan Agreement; ( f ) A Guaranty whereby Jerome J . Schwab and Ralph C . Deuschle guaranty the obligations of S & D Properties ( the "Guaranty" ) . 3 . ) Findings . It is hereby found , determined and declared that : ( a ) The Project , as described in Paragraph 2 above and in the Loan Agreement , constitutes a project authorized and described in Section 474 . 02, Subd . la , of the Act . ( b ) The purpose of the Project is and the effect thereof will be to promote the public welfare by : preventing the emergence of blighted and marginal lands and areas of chronic unemployment ; preventing economic deterioration ; the development of sound industry and commerce to use the available resources of the community , in order to retain the benefit of the community ' s existing investment in educational and public service facilities ; halting the movement of talented , educated personnel to other areas and thus preserving the economic and human resources needed as a base for providing governmental services and facilities ; and increasing the tax base of the City and the county and school district in which the Project is located . ( c ) The Project has been approved by the Commissioner of Securities of the State of Minnesota . ( d ) The City is a duly organized and existing municipal corporation under the laws of the State of Minnesota and has power to issue the Bond under the Act . ( e ) Issuance and sale of the Bond , the execution and delivery of the Loan Agreement , the Loan Assignment and the Construction Loan Agreement and the performance of all of the covenants and agreements of the City contained in the Bond , the Loan Agreement , the Loan Assignment, and 2 . the Construction Loan Agreement , and of all other acts of the City to make the Bond , the Loan Agreement , the Loan Assignment , and the Construction Loan Agreement valid and binding obligations of the City in accordance with their terms , are authorized by the Act . ( f ) It is desirable that the Bond , in the principal amount of $350 , 000 , to be issued by the City upon the terms set forth herein and in the Loan Agreement, be assigned to the Lender pursuant to the Loan Assignment as security for the payment of principal of , premium, if any , and interest on the Bond . ( g ) The Loan Agreement provides for payments by the Borrower to the Lender for the account of the City of such amounts as will be sufficient to pay when due the principal of , premium, if any , and interest on the Bond . No reserve funds are deemed necessary for this purpose . The Loan Agreement obligates the Borrower to provide for the operation and maintenance of the Project , including the funds necessary to pay insurance premiums , taxes and special assessments . ( h ) Under the provisions of Section 474 . 10 , Minnesota Statutes , and as provided in the Loan Agreement , the Bond shall recite that the Bond is not to be payable from or charged upon any funds other than amounts payable by the Borrower pursuant to the Loan Agreement which are pledged to the payment thereof , or moneys received upon disposition of the Mortgaged Property under the Mortgage or under the Assignment ; the City is not sutject to any liability thereon ; no holder of the Bond shall ever have the right to compel the exercise of the taxing power of the City to pay the Bond or the interest thereon , nor to enforce payment thereof against any property of the City ; the Bond shall not constitute a charge , lien or encumbrance , legal or equitable , upon any property of the City other than its interest in the Loan Agreement ; the Bond shall recite that the Bond , including interest thereon , shall not constitute or give .rise to a pecuniary liability of the City or a charge against its general credit or taxing powers and that the Bond does not constitute an indebtedness of the City within the meaning of any constitutional or statutory limitation . ( i ) There is no litigation pending or, to - the best of its knowledge threatened , against the City relating to the Project or to the Bond , the Loan Agreement , the Loan Assignment or the Construction Loan Agreement, or questioning the organization of the City or its power or authority to issue the Bond or execute and deliver the Loan Agreement and the Loan Assignment . d t 3 . ( j ) The execution, delivery and performance of the City ' s obligations under the Bond , the Loan Agreement, the Loan Assignment and the Construction Loan Agreement have been Fully authorized by all requisite action and do not and will not violate any order of any court or other agency of government, or any indenture, agreement or other instrument to which the City is a. party or by which it or any of its property is bound , or be in conflict with, result in a breach of , or constitute ( with due notice or lapse of time or both ) a default under any such indenture, agreement or other instrument, provided , however, that this finding is made solely for the purpose of es topp i ng the City from denying the validity of the Bond or any of the documents referenced in this paragraph by reason of the existence of any facts contrary to this finding . (k ) Notting has come to the attention of the City Council to indicate that any member of the C ity Council ( i ) has a direct or indirect interest in the Project, the Loan Agreement, the Loan Assignment, the Construction Loan Agreement, or the Bond , ( ii ) owns anv capital stock of or other interest in the Project or the Company , ( iii ) is an officer or director of the Company , ( iv ) will be involved in supervising the completion of the Project, or ( v ) will receive any commission , bonus or other remuneration for or in respect of the Project, the Loan Agreement, the Loan Assignment, the Construction Loan Agreement or the Bond . 4 . ) Approval and Execution of Documents . The forms of the Loan Agreement, Loan Assignment, Mortgage, Assignment, Construction Loan Agreement, Construction Loan Disbursement Agreement and Guaranty , described in Paragraph 2 , above, are hereby approved . The Loan Agreement, Loan Assignment, and Construction Loan Agreement shall be executed in the name and on behalf of the City by its Mayor and City Manager, or by other appropriate officers of the City authorized to execute documents on its behalf , in substantially the form on f it e, but with all such changes therein, not inconsistent with the Act or other law , as may be approved by officers executing the same, which approval shall be conclusively evidenced by the execution thereof . Copies of all documents shall be delivered and filed as provided therein. The Mortgage, Assignment, and Construction Loan Disbursement Agreement may contain such revisions as may be approved by the Lender and the parties executing the same. 5 . ) Approval , Execution and Delivery of Bond . At such time as the Borrower and ttEe Lender desire to close the transactions authorized by this resolution, the City shall proceed to issue the Bond , to be dated the date of delivery , in the principal amount of $350 , 000 , in substantially the Eor_m and containing substantially the terms set forth in the form of Bond attached 'hereto as Exhibit A , which terms are for this purpose incorporated in this resolution and made a part hereof_ , but with all such changes therein, not inconsistent with the Act or other law , as may be � oprov ed cy officers executing the same, which approval shall be ,nclusively evidenced by the execution thereof . The proposal of the 4 . Lender to purchase the Bond at a price of $3 50 , 000 ( 100% of its par value ) is hereby found and determined to be reasonable and is hereby accepted . The Mayor and City Manager are authorized and directed to prepare the nd in typewritten form substantially in the form set forth in Exhibit hereto . The Bond shall be executed by the manual signatures of the Mayor and City Manager and attested by the manual signature of the City Clerk , and the official sea]. of the City s h al 1 be affixed thereto . Wh en so prepared and executed , the Bond shall be delivered to the Lender at the time of the execution and delivery of the Loan Agreement and all of the related documents. The Bond shall contain a -recital that it is issued pursuant to the Act, and such recital shall be conclusive evidence of the validity and regularity of the issuance thereof . 6 . ) Reqistration Records . The City Clerk , as Bond Registrar, shall keep a Bond Register in which the City shall provide for the registration of the Bond and for transfers of the Bond . The principal of and interest on the Bond shall be payable to the Lender or registered assigns in lawful money of the United States of America at the address of the Lender or registered assigns as shown on the Bond Register. 7 . ) Mutilated , Lost, Stolen or. Destr2Zed Bond . If the Bond is mutilated, lost, stolen or destroyed , the City may execute and deliver to the registered owner a new bond of like date, number, maturity and tenor as that mutilated , lost, stolen or destroyed ; provided that, in the case of mutilation, the mutilated Bond shall first be surrendered to the City , and in -the case of a lost, stolen or destroyed Bond , there shall be first furnished to the City and the Borrower evidence of such loss, theft or destruction satisfactory to the City and the Borrower, �gether with indemnity satisfactory to them . The City may charge the �ndholder with its reasonable fees and expenses in this connection. 8 . ) Transfer of Bond ; Person Treated as Owner. The Bond shall be transferable by the register owner on the on_ Register of the City , upon presentation of the Bond for notation of such transfer thereon at the office of the City Clerk , as Bond Registrar, accompanied by a written instrument of transfer in form satisfactory to the Bond Registrar, duly executed by the registered owner or its attorney duly authorized in writing . The registered owner seeking to transfer ownership of the Bond shall also give written notice thereof to the Borrower. The Bond shall continue to be subject to successive transfers at the option of the rea istered owner of the Bond . No service charge shall be made for any such transfer, but the Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable i n connection therewith. The Bond Registrar shall give written notice to the Borrower of any transfer of ownership recorded on the Bond Register immediately upon effectuating the same. The person in whose name the Bond shall be registered from time to time shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of the principal of and interest on the Bond shall be made only to or upon the order of the owner thereof , or its attorney duly authorized in writing , and neither the City , the Bond Registrar nor the Borrower shall be affected by any notice to the contrary . All such payments shall be valid and effectual to satisfy and discharge the liability upon the Rond to the extent of the sum or sums so paid . a 1 9 . ) Amendments , Changes and Modifications to Loan Agreement , Loan ,signment , the Construction Loan Agreement and Bond Resolution . The _ty shall not , without the written consent of the Lender, enzer into any agreement , change , modification , alteration or termination of the Loan Agreement , the Loan Assignment, the Construction Loan Agreement or this Bond Resolution . 10 . ) Certificates , etc . The Mayor, City Manager and City Clerk , and other officers of the City are authorized and directed to prepare and furnish to the purchaser of the Bond certified copies of all proceedings and records of the City relating to the Bond , and such other affidavits and certificates as approved by the City Attorney as may be required to show the facts appearing from the books and records in such 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 City as to the truth of all statements contained therein. 11 . ) Substitute City Officers - In the absence of the Mayor , City Clerk or City Manager, any of the documents authorized by this Bond Resolution to be executed may be executed by the Acting Mayor or the Deputy City Clerk or Manager, respectively . Approved Mavor Attest 2,Z City Clerk o .