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HomeMy WebLinkAboutResolution - 81-135 - MIDB's - Hustad Properties - $350,625.00 - Final Approval - 07/21/1981 Extract of Minutes of Meeting of the City Council of the City of Eden Prairie, Minnesota Pursuant to due call and notice thereof, a regular meet- ing of the City Council of the City of Eden Prairie, Minnesota was duly held at City Hall in said City on Tuesday the 21st day of July, 1981 , at 7: 30 o ' clock P .M. The following Council.members were present: George Bentley, Dean Edstrom, Paul Redpath , George Tangen, & Mayor 'Wolfgang Penzel and the following was absent: none Councilmember George Bentley introduced and read the following written resolution and moved its adoption: RESOLUTION NO . k/7/Jr' A RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF A REVENUE BOND PURSUANT TO THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT TO PROVIDE FUNDS TO BE LOANED TO HUSTAD PROPERTIES , A MINNESOTA GENERAL PARTNERSHIP , FOR A COMMERCIAL PROJECT AND APPROVING THE LOAN AGREEMENT, ASSIGNMENT AND PLEDGE OF LOAN AGREEMENT, MORTGAGE AND SECURITY AGREEMENT, GUARANTY AND ASSIGNMENT OF RENTS AND LEASES . The motion for the adoption of the foregoing resolution was duly seconded by Councilmeniber _Paul Redpath and upon a vote being taken thereon the following voted in favor thereof : a "\ and the following voted against the same : whereupon said resolution was declared duly passed and adopted. RESOLUTION NO . A RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF A REVENUE BOND PURSUANT TO THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT TO PROVIDE FUNDS TO BE LOANEI: TO HUSTAD PROPERTIES, A MINNESOTA GENERAL PARTNERSHIP , FOR A COMMERCIAL PROJECT A14D APPROVING THE LOAN AGREEMENT, ASSIGNMENT AND PLEDGE OF LOAN AGREEMENT, MORTGAGE AND SECURITY AGREEMENT, GUARANTY AND ASSIGNMENT OF RENTS AND LEASES . BE IT RESOLVED by the City Council ( this "Council " ) of the City of Eden Prairie , Minnesota ( the "City" ) , as follows : 1 . Authority . The City is , by the Constitution and Laws of the State of Minnesota , including the Municipal Industrial Development Act, Minnesota Statutes , Chapter 474 , as amended ( the "Act" ) authorized to issue and sell its revenue bonds for the purpose of financing the acquisition, construction and equipping of authorized projects and to enter: into contracts necessary or convenient in the exercise of the powers granted by the Act . 2 . Documents Presented. This Council proposes that the City shall issue and sell its First Mortgage Commercial Development Revenue Bond (Hustad Properties Project ) in substantially the form set forth in Exhibit A attached hereto ( the "Bond" ) and loan the proceeds thereof to Hustad Properties , a Minnesota general partner- ship ( the "Company" ) to partially pay the cost of acquiring certain land and an office building and related facilities thereon, together with necessary exterior utilities and site improvements ( the "Pro- ject" ) , all pursuant to the Act. Forms of the following documents relating to the Bond and the Project have been submitted to this Council and are now on file in the office of the City Clerk : ( a ) Loan Agreement to be entered into between the City and the Company whereby the City agrees to make a loan to the Company of the funds advanced by the Mortgagee , hereinafter defined, and the Company agrees to pay amounts sufficient to provide for the prompt payment of the principal of and interest on the Bond; (b ) Assignment and Pledge of Loan Agreement ( the "Pledge" ) to be executed by the City in favor of TCF Mortgage Corp . , a Minnesota corporation ( the "Mortgagee" ) whereby the City assigns certain cf its .interest in the Loan Agreement to the Mortgagee as security for the Bond; -2- ( c ) Mortgage and Security Agreement ( the "Mortgage " ) , to be executed by the Company in favor of the Mortgagee by which the Company grants to the Mortgagee a first mortgage lien on and security interest in the Project and all improvements thereto as security for the Bond ( this document will not be executed by the City ) ; ( d ) Guaranty Agreement ( the "Guaranty" ) to be executed by Wallace H . Hustad and Ruth K. Hustad to the Mortgagee ( this document will. not be executed by the City ) ; and ( e ) Assignment of Rents and Leases ( the "Assign- ment" ) , to be executed by the Company in favor of the Mortgagee whereby the Company assigns its interest in the rents and leases of the Project to the Mortgagee as additional security for the Bond ( this document will. not be executed by the City ) . 3 . Findings . It is hereby found, determined and declared that: ( a ) The City is a duly organized and existing municipal corporation under_ the Constitution and the laws of the State of Minnesota with the powers and authority, among others , to issue the Bond under the Act . (b ) Based on representations of the Company, the Project, comprised of the land, buildings and improve- ments described in the Loan Agreement and the Mortgage , constitutes a project authorized by and described in Section 474 . 02 , Subd . la of the Act . ( c ) 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 conuiierce so as to prevent the emer- gence of or to rehabilitate , so far as possible , blighted and marginal lands and areas of chronic unemployment; the retention of industry to use the available resources of the ccnununity in order to retain the benefit of its existing investment in educational and public service facilities ; halting the movement of talented , educated personnel of mature age to other areas and thus preserv- ing the economic and human resources needed as a base for providing governmental services and facilities ; and more intensive development of land available in the community to provide an adequate and better balanced tax base to finance the increase in the amount and cost of governmental services . -3- ( d) The Pro j ec-u has been approved by the Commis- sioner of Securities , Minnesota Department of Commerce . ( e ) The Issuance and Sale of the Bond, the execu- tion and delivery of the Loan Agreement and Pledge and the performance of all covenants and agreements of the City contained in the Bond, Loan Agreement and Pledge and of all other acts of. the City to make the Loan Agreement, Pledge and Bond valid and binding obligations of the City in accordance with their terms , are author- ized by the Act. ( f ) To the best knowledge of the members of this Council , there is no litigation, action, suit, proceed- ing or investigation at law or in. equity before or by any court, public board or body pending or threatened against, or affecting the City wherein an unfavorable decision, ruling or finding would adversely affect the transactions contemplated by or the validity or enforce- ability of this Bond Resolution, the Bond, Loan Agreement, or Pledge in accordance with their respective terms . (g ) There are no agreements to which the City is a ?arty, ordinances or resolutions of the City or court orders directed to the City affecting the validity or enforceability of this Bond Resolution , the Bond , Loan Agreement or Fledge provided, however, that this finding is made solely for the purpose of estopping the City from denying the validity of the Bond, Loan Agreement or Pledge by reason of the existence of any facts contrary to this finding . (h) It is desirable that the City of Eden Prairie First Mortgage Commercial Development Revenue Bond (Hustad Properties Project) in the amount of $350 , 625 be issued by the City upon the terms set forth herein, and that certain of the City ' s interest in the Loan Agreement be assigned to the Mortgagee as security for the payment of principal of and interest on the Bond . ( i ) The Loan Agreement provides for payments by the Company to the Mortgagee for the account of the City of such amounts as will be sufficient to pay the principal of and interest on the Bond when due . No reserve funds are deemed necessary for this purpose . The Loan Agreement obligates the Company to provide foz: the operation and maintenance of the Project, including adequate insurance , taxes and special assessments . -4- ( j ) Under_ the provisions of Section 474 . 10 of the Act , and as provided in the Loan Agreement, the Bond is not to be payable from nor charged upon any funds other than amounts payable by the Company pursuant to the Loan Agreement which are pledged to the payment thereof; the City is not subject -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 rights under the Loan Agreement; the Bond shall recite that the Bond, including interest thereon, shall not constitute nor give rise to a pecuniary liability of the City or a charge against its general credit or taxing powers and that the Bond does riot constitute an indebtedness of the City within the meaning of any constitutional or statutory limitation. 4 . Approval and Execution of Documents . The forms of Loan Agreement , Pledge , Mortgage , Guaranty and Assignment referred to in Paragraph 2 hereof are approved . The Loan Agreement shall be executed in tY.e name and on behalf of the City by the Mayor and the City Manager in substantially the .form on file, but with all such changes therein, not inconsistent with the Act or other law, as may be approved by the officers executing the same , which approval shall be conclusively evidenced by the execution thereof . The Pledge shall also be executed in the name and on behalf of the City by the Mayor and the City Manager in substantially the form on file , but with all such changes therein, not inconsistent with the Act or other laws , as may be approved by the officers executing -the sarne, which approval shall be conclusively evidenced by the execution thereof. Copies of all documents shall. be delivered and filed as provided therein . The Mortgage , Guaranty and Assignment may contain such revisions as may be approved by the Mortgagee and the parties executing the same . 5 . _Approval , Execution and Delivery of Bond . The City shall proceed forthwith. to issue its First Mortgage Commercial Development Revenue Bond ( Hustad Properties Project ) , to be dated the date of delivery, in the principal amount of $350, 625 in the form and containing 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. The proposal of the Mortgagee to purchase the Bond at a price of $350 , 625 ( 100% of its par value ) is hereby found and determined to be reasonable and is hereby accepted . The Mayor and the City Manager are authorized and directed to prepare the Bond in typewritten form substantially in -5- the form set forth in Exhibit A attached hereto . The Bond shall be executed by the manual signatures of the Mayor and the City Manager and the official seal of the Citv shall be affixed thereto and attested by the City Clerk. When so prepared and executed the Bond shall be delivered to the Mortgagee upon receipt of the purchase price therefor , which may be paid to the parties entitled to receive the loan proceeds in accordance with the Loan Agreement . 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 . Registration Records . The City Clerk, as bond regis- trar ( the "Bond Registrar" ) , shall keep a bond register (the "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 Mortgagee or regis- tered assigns in lawful money of the United States of America at the address of the Mortgagee or registered assigns as shown on the Bond Register . 7 . Mutilated , Lost, Stolen or Destroyed 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 Company evidence of such loss , theft or destruction satisfactory to the City and the Company together with indemnity satisfactory to them . The City may charge the holder of the Bond with its tees and expenses in this connection. 8 . Transfer of Bond; Person Treated as Owner - The Bond shall be transferable by the registered owner on the Bond 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 Company . The Bond shall continue to be subject to successive transfers at the option of the registered 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 in connection there- with . The Bond Registrar shall give written notice to the Company of any transfer of ownership recorded on the Bond Register immedi- ately upon effectuating same . The person in whose name the Bond shall be registered from time to time shall be deemed and regarded r' 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 registered owner thereof, or its attorney duly authorized in writing, and neither the City, the Bond Registrar nor the Company 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 Bond to the extent of the sum or sums so paid . 9 . Amendments , Changes and Modifications . The City shall not, without the written consent of the Mortgagee, enter into any agreement, change, modification , alteration or termination of the Loan Agreement, Pledge or this Bond Resolution. 10 . Proceedings and Records Relating to Bond. The Mayo4, 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 certifi- cates as may be required to show the facts appearing 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 City as to the truth of all statements contained therein . { Approved: P ayor Attest: y Clerk -7-- STATE OF MINNESOTA ) ss . COUNTY OF HENNEPIN ) I , the undersigned, being the duly qualified and acting City Clerk of the City of Eden Prairie , Minnesota, do hereby . certify that I have compared the attached extract of minutes of a regular meeting of the City Council of the City held on _ , the day of July, 1981 , with the original thereof on file in my office, and that the attached extract is a full , true and correct transcript of the original insofar as such minutes relate to the $35C , 625 First. Mortgage Commercial Development Revenue Bond (Hustad Properties Project) of the City . WITNESS My hand and seal as said City Clerk this day of _ 1981 . City Clerk ( Seal ) _g_