HomeMy WebLinkAboutResolution - 81-243 - Final Apprival - MIDB's - Kinder Care Learning Center - $250,000 - 12/15/1981 FINAL NOTE RESOLUTION
CITY OF EDEN PRAIRIE
$250, 000 COMMERCIAL DEVELOPMENT REVENUE NOTE OF 1981
(KINDER-CARE LEARNING CENTER PROJECT)
ADOPTED : December 15 , 1981
I.
NOTE RESOLUTION
(This Table of Contents is not a part of this
Resolution, but is included for convenience only)
TABLE OF CONTENTS
ARTICLE ONE - DEFINITIONS, LEGAL AUTHORIZATION Page
ANDFINDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1-1 . Definitions . . . . . . . . . . . . . . . . . . . . . . 1
Section 1-2 . Legal Authorization. . . . . . . . . . . . . . 3
Section 1-3 . Findings. . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1-4. Authorization and Ratification
of Project. . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLETWO - NOTE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2-1 . Authorized Amount and Form
of Note. . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2-2 . The Note. . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 2-3 . Execution. . . . . . . . . . . . . . . . . . . . . . . . 15
Section 2-4 . Delivery of Note. . . . . . . . . . . . . . . . . 15
Section 2-5 . Disposition of Note Proceeds . . . . 16
Section 2-6 . Registration of Transfer. . . . . . . . . 16
Section 2-7 . Mutilated, Lost or Destroyed Note 16
Section 2-8 . Ownership of Note. . . . . . . . . . . . . . .. . 17
Section 2-9 . Limitation on Note Transfers . . . . . 17
Section 2-10 . Issuance of New Notes . . . . . . . . . . . . 17
ARTICLE THREE - GENERAL COVENANTS. . . . . . . . . . . . . . . . . . . . 18
Section 3-1 . Payment of Principal and Interest 18
- Section 3-2 . Performance of and Authority'
for Covenants . . .. . . . . . . . . . . . . . . . . . 18
Section 3-3 . Enforcement and Performance of
Covenants. . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3-4 . Nature of Security. . . . . . . . . . . . . . . 19
ARTICLE FOUR - MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 4-1 . Severability. . . . . . . . . . . . . . . . . . . . . 20
Section 4-2 . Authentication of Transcript. . . . . 20
Section 4-3 . Registration of Resolution. . . . . . . 20
Section 4-4. Authorization to Execute
Agreements . . . . . . . . . . . . . . . . . . . . . . . 20
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . 21
NOTE RESOLUTION
BE IT RESOLVED by the City Council of the City of
Eden Prairie, Minnesota, as follows :
ARTICLE ONE
DEFINITIONS, LEGAL AUTHORIZATION AND FINDINGS
1-1 . Definitions .
The terms used herein, unless the context hereof
shall require otherwise shall have the following meanings, and
any other terms defined in the Loan Agreement shall have the
same meanings when used herein as assigned to them in the Loan
Agreement unless the context or use thereof indicates another
or different meaning or intent.
Act: the Minnesota Municipal Industrial Development Act,
Minnesota Statutes, Chapter 474, as amended;
Assignment of Leases and Rents: the agreement to be
executed by the Borrower assigning all the rents, issues and
profits derived from the Project to the Lender to secure the
repayment of the Note and interest thereon;
Bond Counsel: the firm of Briggs and Morgan, Professional
Association, of St. Paul and Minneapolis, Minnesota, and any
opinion . of Bond Counsel shall be a written opinion signed by
such Counsel;
Borrower: Westin and Hesse Partnership, a Minnesota
general partnership, its successors, assigns, and any
surviving, resulting or transferee business entity which may
assume its obligations under the Loan Agreement;
City: the City of Eden Prairie, Minnesota, its successors
. and assigns;
Construction Fund: the fund established by the City
pursuant to this Resolution and into which the proceeds of the
Note will be deposited;
Construction Loan Agreement: the agreement to be executed
by the City, the Borrower and the Lender, relating to the
disbursement and payment of Project Costs for the construction
and installation of the Improvements;
Guarantors : collectively, Carl O. Westin and Harold F.
Hesse,-
Guaranty: the personal guaranty to be executed by the
Guarantor in favor of the Lender;
Improvements : the structures and other improvements,
including any tangible personal property, to be constructed or
installed by the Borrower on the Land in accordance with the
Plans and Specifications;
Land: the real property and any other easements and
rights described in Exhibit A attached to the Loan Agreement;
Lease: the Lease of the Project dated ,
between Richard J. Nordlund, as lessor, and the Tenant, as
lessee, which lease will be assigned by Richard J. Nordlund to
the Borrower;
Lender: First National Bank of Chaska, in Chaska,
Minnesota, its successors and assigns ;
Loan Agreement : the agreement to be executed by the City
and the Borrower, providing for the issuance of the Note and
the loan of the proceeds thereof to the Borrower, including any
amendments or supplements thereto made in accordance with its
provisions;
Mortgage :_ the Mortgage, Security Agreement and Fixture
Financing Statement to be executed by the Borrower, as
mortgagor, to the Lender, as mortgagee, securing payment of the
Note and interest thereon;
Note: the $250, 000 Commercial Development Revenue Note of
1981 (Kinder-Care Learning Center Project) , to be issued by the
City pursuant to this Resolution and the Loan Agreement;
Note Register: the records kept by the City Clerk to
provide for the registration of transfer of ownership of the
Note;
Plans and Specifications : the plans and specifications
for the construction and installation of the Improvements on
the Land, which are approved by the Lender, together with such
modifications thereof and additions thereto as are reasonably
determined by the Borrower to be necessary or desirable for the
completion of the Improvements and are approved by the Lender;
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Pledge Agreement : the agreement to be executed by the
City and the Lender assigning the Loan Agreement to the Lender;
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3 Prime Rate: the prime rate of interest publicly ( or
equivalent successor rate) set or announced from time to time
by First National Bank of Minneapolis, in Minneapolis,
Minnesota, as the basis for determining the rate of interest on
commercial borrowing;
Principal Balance : so much of the principal sum on the
Note as from time to time may have been advanced to or for the
benefit of the City and remains unpaid at any time;
Project : the Land and Improvements as they may at any
time exist;
Project Costs : the total of all "Construction Costs" and
"Loan and Carrying Charges, " as those terms are defined in the
Loan Agreement ;
Resolution: this Resolution of the City adopted
December 15, 1981 , together with any supplement or amendment
thereto;
Subordination Agreement: the Subordination, Nondis-
turbance and Attornment Agreement of even date herewith
executed by the Borrower, the Tenant and the Lender;
Tenant: Kinder-Care Learning Centers, Inc . , a Delaware
corporation, its successors and assigns .
All references in this instrument to designated
"Articles, " "Sections" and other subdivisions are to the
designated Articles, Sections and subdivisions of this
instrument as originally executed. The words "herein, "
"hereof" and "hereunder" and other words of similar import
refer to this Resolution as a whole not to any particular
Article, Section or subdivision.
1-2 . Legal Authorization.
The City is a political subdivision of the State of
Minnesota and is authorized under the Act to initiate the
revenue producing project herein referred to, and to issue and
sell the Note for the purpose, in the manner and upon the terms
and conditions set forth in the Act and in this Resolution.
1-3 . Findings .
The City Council has heretofore determined, and does
hereby determine, as follows :
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(1 ) The City is authorized by the Act to enter into a
Loan Agreement for the public purposes expressed in the Act;
( 2 ) The City has made the necessary arrangements with the
Borrower for the establishment within the City of a Project
consisting of certain property all as more fully described in
the Loan Agreement and which will be of the character and
accomplish the purposes provided by the Act, and the Ci--y has
by this Resolution authorized the Project and execution of the
Loan Agreement, the Pledge Agreement, the Note and the
Construction Loan Agreement, which documents specify the terms
and conditions of the acquisition and financing of the
Improvements to be included in the Project;
( 3 ) in authorizing the Project the City' s purpose is, and
in its judgment the effect thereof will be, to promote the
public welfare by: the attraction, encouragement and
development of economically sound industry and commerce so as
to prevent, so far as possible, the emergence of blighted and
marginal lands and areas of chronic unemployment; the develop-
ment of revenue-producing enterprises 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; the halting of the movement of talented,
educated personnel of all ages to other areas thus preserving
the economic and human resources needed as a base for providing
governmental services and facilities ; the provision of acces-
sible employment opportunities for residents in the area; the
expansion of an adequate tax base to finance the cost of
governmental services, including educational services for the
school district serving the community in which the Project is
situated;
(4) the amount estimated to be necessary to partially
finance the Project Costs, including the costs and estimated
costs permitted by Section 474 . 05 of the Act, will require the
issuance of the Note in the principal amount of $250 , 000 as
hereinafter provided;
( 5) it is desirable, feasible and consistent with the
objects and purposes of the Act to issue the Note, for the
purpose of partially financing the Improvements to be included
in the Project;
( 6) the Note and the interest accruing thereon do not
constitute an indebtedness of the City within the meaning of
any constitutional or statutory limitation and do not
constitute or give rise to a pecuniary liability or a charge
against the general credit or taxing powers of the City and
neither the full faith and credit nor the taxing powers of the
City is pledged for the payment of the Note or interest
thereon; and
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(7 ) The Note is an industrial development bond within the
meaning of Section 103 (b) of the Internal Revenue Code and is
to be issued within the exemption provided urLder subparagraph
(A) of Section 103 (b) (6) of the Code with respect to an issue
of $ 1, 000, 000 or less; provided that nothing herein shall
prevent the City from hereafter qualifying the Note under a
different exemption if, and to the extent, such exemption is
permitted by law and consistent with the objects and purposes
of the Project.
1-4 . Authorization and Ratification of Project.
The City has heretofore and does hereby authorize the
Borrower, in accordance with the provisions of Section
474. 03 ( 7 ) of the Act and subject to the terms and conditions
set forth in the Construction Loan Agreement, to provide for
the construction and installation of the Improvements to be
included in the Project pursuant to the Plans and Speci-
fications by such means as shall be available to the Borrower
and in the manner determined by the Borrower, and without
advertisement for bids as may be reguired for the construction
and acquisition of municipal facilities; and the City hereby
ratifies, affirms, and approves all actions heretofore taken by
the Borrower consistent with and in anticipatdon of such
authority and in compliance with the Plans and Specifications .
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ARTICLE TWO
NOTE
2-1 . Authorized Amount and Fonn of Note.
The Note issued pursuant to this Resolution shall be
in substantially the form set forth herein, with such
appropriate variations, omissions and insertions as are
permitted or required by •this Resolution, and in accordance
with the further provisions hereof; and the total principal
amount of the Note that may be outstanding hereunder is
expressly limited to $250, 000 unless a duplicate Note is issued
pursuant to Section 2-7 . The Note shall be in substantially
the following form:
UNITED STATES OF AMERICA
STATE OF AINNESOTA
COUNTY 0F" HENNEPIN
CITY OF EDEN PRAIRIE
Commercial Developmer3t Revenue Note of 1981
(Kinder-Care Learming Center Project)
$250, 000
FOR VALUE RECEIVED t}se CITY OF EDEN PRAIRIE, Hennepin
County, Minnesota, ( the "City") hereby promises to pay First
National Bank of Chaska, in Chaska, Minnesota (the "Lender" ) ,
its successors or registered assigns , from the source and in
the manner hereinafter provided, the principal sum of TWO
HUNDRED FIFTY" THOUSAND AND NO/L00 DOLLARS ( $250, 000 .00 ) , or so
much thereof_ as may have been advanced to or for the benefit of
the City and remains unpaid from time to time (the "Principal
Balance" ) , with interest thereon at the rate of twelve percent
( 12% ) per annum or at such higher rate as hereinafter provided
in paragraph 1 (d) hereof, in any coin or currency which at the
time or times of payment is legal tender for the payment of
public or private debts in the United States of America, in
accordance with the terms hereinafter set forth.
1. ( a) From and after the date hereof and until the
"Amortization Date" (the first day of the calendar month next
succeeding completion of the Project in accordance with the
Construction Loan Agreement hereinafter referred to, but in any
any
event no later than unless extended by the
Lender) , interest only shall be paid and interest shall be
computed on the basis of actual days elapsed on a year of 365
days . Interest shall accrue from and after the date of each
and every advance so made under this Note and shall be payable
on the first day of the calendar month next succeeding the date
upon which the first advance is made, and on the first day of
each and every month thereafter-. .
(b) From and after the Amortization Date ,
interest shall he computed on the basis of an assumed year of
360 days composed of twelve thirty-day months, and the
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Principal Balance and accrued interest shall be amortized and
paid in 239 equal consecutive monthly installments of $ ,
payable on the first day of each month commencing on the first
day of the calendar month next succeeding the Amortization Date
and continuing until the twentieth anniversary of the
Amortization Date, at which time the entire Principal Balance
and accrued interest thereon shall be due and payable in full
(the "Final Maturity Date" ) . Payments shall be applied first
to interest due on the Principal Balance and thereafter to
reduction of the Principal Balance.
( c) If the interest on this Note should become
subject to federal income taxation pursuant to a "Determination
of 'Taxability" as that term is defined in Section 4. 07 of the
Loan Agreement hereinafter referred to, and the Lender delivers
to the Borrower a copy of the notice of the "Determination of
Taxability", the interest rate shall be immediately increased
to two percent ( 2% ) per annum and in excess of the Prime Rate
of First National Bank of Minneapolis ( i . e. the rate of
interest publicly announced by First National Bank of
Minneapolis from time to time as its prime rate) as that rate
may change from time to time, with changes in the interest rate
applicable hereunder to become effective on the same day as
such change in the Prime Rate takes place, such interest to be
computed on the basis of actual days elapsed in a year of 365
days; but in no event shall the interest rate hereunder ever be
less than 12.% per annum regardless of changes in the Prime
Rate . The monthly installments of accrued interest only under
paragraph 1 ( a) hereof shall be adjusted accordingly and each
monthly installment payable under paragraph 1 (b) hereof after
such increase in the interest rate shall be equal to the then
remaining Principal Balance divided by the number of monthly
payments remaining to the Final Maturity Date, plus accrued
interest at said increased rate; and in addition the Lender
shall be entitled to receive upon demand an amount equal to the
aggregate difference between ( i ) the monthly payments
theretofore made to the Lender on this Note between the "Date
of Taxability" , as that term is defined in the Loan Agreement ,
and the date of receipt by the Borrower of notice of such
"Determination of Taxability" , and ( ii) the monthly payments
which would have been made during such period if the increased
rate had been in effect throughout such period .
(d) Unless a "Determination of Taxability"
shall occur, in which event the interest rate shall be governed
by paragraph 1 ( c) hereof, the rate of interest on the Principal
Balance shall be adjusted on December 15 , 1986, December 15,
1991 , December 15, 1993, December 15, 1995, December 15, 1997 ,
and December 15, 1999 to be equal to the greater of ( i ) 75% of
the Prime Rate of First National Bank of Minneapolis (I.e. the
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rate of interest publicly announced by First National Bank of
Minneapolis from time to time as its prime rate) as that rate
is established at the end of the last business day before the
day on which the adjustment is made, or ( ii) twelve percent
(12% ) per annum. Each monthly installment payable after each
such adjustment date shall be accordingly adjusted and shall be
equal to the amount necessary to amortize the remaining
Principal Balance plus accrued interest at such adjusted rate
by the Final Maturity Date in equal monthly installments.
2 . In any event, the payments hereunder shall be
sufficient to pay all principal and interest due, as such
principal and interest become due, and to pay any premium or
penalty, at maturity, upon redemption, or otherwise.
3 . If the Lender should not receive on the first day
of any month all of the principal and interest then due on the
Note, and if the City should continue to be in arrears through
the fifteenth day of such month, then, in addition to all other
sums due hereunder, the Lender shall be entitled to receive on
the sixteenth day of such month a service charge equal to four
percent (4.00% ) of the delinquent principal and interest.
4 . Principal and interest and premium due hereunder
shall be payable at the principal office of the Lender, or at
such other place as the Lender may designate in writing.
5 . This Note is issued by the City to provide funds
for a project, as. defined in Section 474 . 02 , Subdivision la,
Minnesota Statutes, consisting of the construction and
equipping of a child learning and day-care facility on land
within the City, pursuant to a Loan Agreement of even date
herewith between the City and Westin and Hesse Partnership (the
"Borrower") (the "Loan Agreement" ) , and this Note is further
issued pursuant to and in full compliance with the Constitution
and laws of the State of Minnesota, particularly Chapter 474,
Minnesota Statutes, antl pursuant to a resolution of the City'
Council duly adopted on December �, ")1981 (the "Resolution
6 . This Note is secured by a Pledge Agreement of
even date herewith by the City to the Lender (the "Pledge
Agreement" ) , a Mortgage, Security Agreement and Fixture
Financing Statement, of even date herewith between the
Borrower, as mortgagor, and the Lender as mortgagee (the
"Mortgage" ) , by a Guaranty of even date herewith from Carl O.
Westin and Harold F. Hesse to the Lender (the Guaranty) and by
an Assignment of Leases and Rents , of even dame herewith, from
the Borrower to the Lender ( the "Assignment of Leases and
Rents" ) . The disbursement of the proceeds of this Note is
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subject to the terms and conditions of a Construction Loan
Agreement of even date herewith between the Lender, the City
and the Borrower ( the "Construction Loan Agreement" ) .
7 . The Lender rnay extend the times of payments of
interest and/or principal of or any penalty or premium due on
this Note, including the Final Maturity Date, without notice to
or consent of any party liable hereon and without releasing any
such party. However, in no event may the Final Maturity Date
be extended beyond thirty (30 ) years from the date hereof.
S. This Note may not be prepaid prior to the
Amortization Date or during the first five ( 5 ) Loan Years, as
hereinafter defined. Beginning with the sixth (6th) Loan Year,
this Note may be prepaid in whole, or in part, on any monthly
payment date upon payment. of a premium of five percent (5%) of
the amount prepaid. The premium for prepayment shall decrease
one percent ( 1% ) for each Loan Year thereafter. Beginning with
the eleventh ' (llth) Loan Year, this Note may be prepaid in
whole or in part on anyrnonthly payment date without premium.
The term "Loan Year" as used herein shall mean a twelve ( 12 )
month period commencing on the Amortization Date and on each
anniversary thereof.
9 . This Note ds further subject to prepayment by the
City, at any time, without a premium, in whole or in part, upon
the occurrence of certain events of damage, destruction or
condemnation of the property secured by the Mortgage, as
specified in Sections 2.03 and 2 . 04 of the Mortgage. Also, if
the Borrower receives from the Lender notice of a
"Determination of Taxability" as defined in Section 4 . 07 (2 ) of
the Loan Agreement, the Note is subject to prepayment at option
of the Lender or the Borrower within 60 days immediately
following such notificat1on, provided the Borrower or Lender
(whichever one is exercising its option) gives at least five
days written advance notice to the other. In addition, the
Lender shall have the option to declare the Principal Balance
and accrued interest due and payable on December 1 , 1991 ,
December 1 , 1993 , December 1 , 1995 , December 1 , 1997 and
December 1, 1999 upon sixty (60 ) days prior written notice to
the City and the Borrower. However, if Lender shall have given
such notice and if at any time prior to November 20, in each of
the above years, the Borrower shall notify the Lender and City
that the Borrower has located a purchaser which has agreed in
writing to purchase this Note on November 30 in any of the
above years , the Lender shall agree to assign to the purchaser
on November 30 of such year, the Note, the Pledge Agreement,
the Mortgage, the Assignment of Leases and Rents, the Loan
Agreement and the Guaranty, without recourse and without any
warranties other than that the Lender is the holder of such
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documents and without cost or expense to the Lender, upon
payment by the purchaser of the outstanding Principal Balance
and accrued interest.
10 . In the event of prepayment of this Note, the
Lender shall apply any such prepayment against the applicable
prepayment premium, if any, then against the accrued interest
. on the Principal Balance and finally against the final
principal amounts due under the Note. the monthly payments due
under paragraph 1 hereof, shall continue to be due and payable
in full until the entire Principal Balance and accrued interest
due on this Note have been paid regardless of any partial
prepayment made hereunder.
11. As provided in the ResoLution and subject to
certain limitations set forth therein, this Note is
transferable upon the books of the City at the office of the
City Clerk, by the Lender in person or by his agent duly
authorized in writing, at the Lender' s expense, upon surrender
hereof together with a written instrument of transfer
satisfactory to the City Clerk, duly executed by the Lender or
his duly authorized agent. Upon such transfer the City Clerk
will note the date of registration and the name and address of
the new registered Lender in the registration blank appearing
below. The City may deem and treat the person in whose name
( the Note is last registered upon the books of the City with
such registration noted on the Note, as the absolute owner
hereof, whether or not overdue, for the purpose of receiving
payment of or on the account, of the Principal Balance,
redemption price or interest and for all. other purposes, and
all such payments so made to the Lender or upon his order shall
be valid and effective to satisfy andc3ischarge the liability
upon the Note to the extent of the sum or sums so paid, and the
City shall not be affected by any notice to the contrary.
12 . All of the agreements, conditions, covenants,
provisions and. stipulations contained ir_ the Resolution, the *
Mortgage, the Assignment of Leases and Rents, the Loan
Agreement, the Pledge Agreement and the Construction Loan
Agreement are hereby made a part' of this Note to the same
extent and with the same force and effect as if they were fully
set forth herein.
13 . This Note and interest thereon and any service
charge or premium due hereunder are payable solely from the
revenues and proceeds derived from the Loan Agreement, the
Mortgage, the Guaranty and the Assignment of Leases and Rents,
and do not constitute a debt of the City within the meaning of
any constitutional or statutory limitation, are not payable
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from or a charge upon any funds other than the revenues and
proceeds pledged to the payment thereof, and do not give rise
to a pecuniary liability of the City or, to the extent
permitted by law, of any of its officers , agents or employees,
and no holder of this Note shall ever have the right to compel
any exercise of the taxing power of the City to pay this Note
or the interest thereon, or to enforce payment thereof against
any property of the City, and this Note does 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
herein referred to shall be subject at all times to the
availability of revenues or other funds furnished for such
purpose in accordance with the Loan Agreement, sufficient to
pay all costs of such performance or the enforcement thereof.
14 . It is agreed that Lime is of the essence of this
Note . If an Event of Default (as that term is defined in the
Mortgage, the Assignment of Leases and Rents, the Construction
Loan Agreement or the Loan Agreement) shall occur, then the
Lender shall have the right and option to declare; upon ten
( 10 ) days written notice, the Principal Balance and accrued
interest thereon, immediately due and payable, whereupon the
same, plus any premiums or service charges , shall be due and
payable, but solely from sums made available under the Loan
Agreement, the Guaranty, the Assignment of Leases and Rents and
the Mortgage.- Failure to exercise such option at any time
shall not constitute a waiver of the right to exercise the same
at any subsequent time.
15 . The remedies of the Lender, as provided herein
and in the Mortgage, the Assignment of Leases and Rents, the
Guaranty, the Loan Agreement, the Pledge Agreement and the
Construction Loan Agreement, are not exclusive and shall be
cumulative and concurrent and may be pursued singly,
successively or together, at the sole discretion of -the Lender,
and may be exercised as often as occasion therefor shall occur;
and the failure to exercise any such right or remedy shall in
no event be construed as a waiver or release thereof.
16 . The Lender shall not be deemed, by any act of
omission or commission, to have waived any of its rights or
remedies hereunder unless such waiver is in writing and signed
by the Lender and, then only to the extent specifically set
forth in the writing. A waiver with reference to one event
shall not be construed as continuing or as a bar to or waiver
of any right or remedy as to a subsequent event.
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( 17 . This Note has been issued without registration
under state or federal or other securities laws, pursuant to an
exemption for such issuance; and accordingly the Note may not
be assigned or transferred in whole or part, nor may a
participation interest in the Note be given pursuant to any
participation agreement, except in accordance with an
applicable exemption from such registration requirements .
IT IS HEREBY CERTIFIED AND RECITED that all
conditions, acts and things required to exist, happen and be
performed precedent to or in the issuance of this Note do
exist, have happened and have been performed in regular and due
form as required by law.
IN WITNESS WHEREOF, the City has caused this Note to
be duly executed in its name by the manual signatures of the
Mayor and City Clerk and has caused the corporate seal to be
affixed hereto, and has caused this Note to be dated
December 1981 .
CITY OF EDEN PRAIRIE, MINNESOTA
{ Mayor
Attests
City Clerk
(SEAL)
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PROVISIONS AS TO REGISTRATION
The ownership of the unpaid Principal Balance of this
Note and the interest accruing thereon is registered on the
books of the City of Eden Prairie in the name of the holder
last noted below.
Date of Name and address Signature of
Registration Registered Owner City Clerk
The First National
Bank of Chaska
December 1981 Chaska, MN 55318
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2-2 . The Note.
The Note shall be dated as of the date of delivery,
shall be payable at the times and in the manner, shall bear
interest at the rate, and shall be subject_ to such other terms
and conditions as are set forth therein.
2-3 . Execution.
The Note shall be executed on behalf of the City by
the signatures of its Mayor and City Clerk and shall be sealed
with the seal of the City. In case any officer whose signature
shall appear on the Note shall cease to be such officer before
the delivery of the Note, such signature shall nevertheless be
valid and sufficient for all purposes, the same as if had
remained in. office until delivery. In the event of the absence
or disability of the Mayor or the City Clerk such officers of
the City as, in the opinion of the City P_t.torney, may act in
their behalf, shall without .further act or authorization of the
City Council execute and deliver the Note.
2-4 . Delivery of Note.
Before delivery of the Note there shall be filed with
the Lender (except to the extent waived by the Lender) the
following items :
( 1 ) an executed copy of each of the following documents:
(A) the Loan Agreement;
(B ) the Pledge Agreement;
(C) the Mortgage;
(D) the Assignment of Leases and Rents;
(E) the Construction Loan Agreement;
(F ) the Guaranty;
(G) a Cost Certificate signed by the Borrower
certifying the use of the proceeds of the Note ;
(H) the Lease;
( 1 ) the Subordination Agreement.
( 2) an opinion of Counsel for the Borrower as prescribed
by Bond Counsel;
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(3 ) the opinion of Bond Counsel as to the validity and
tax exempt status of the Note;
(4 ) a commitment or binder_ for a Mortgagee ' s title
insurance policy written by a Title Insurance Company of
Minnesota insuring the validity of the Mortgage as a first lien
on the Project su-bject only to such exceptions as are approved
by the Lender;
( 5 ) such ot7ler documents and opinions as Bond Counsel may
reasonably require for purposes of rendering its opinion
required in subsection ( 3 ) above or that the Lender may
reasonably require for the closing .
2-5 . Disposition of Note Proceeds.
There is hereby established with the Lender a
Construction Fund to be held by the Lender as a separate
account of the City as provided in the Construction moan
Agreement. Upon -delivery of the Note to Lender, the proceeds
of such Note shall be credited to the Construction Fund held by
the Lender, and the Lender shall, on behalf of the City,
disburse funds therefrom for payment of Project Costs upon
receipt of such supporting documentation as the Lender may deem
reasonably necessary, including compliance with -the provisions
of the Construction Loan Agreement. The Borrower shall provide
the City with a f,a11 accounting of all funds disbursed for
Project Costs .
2-6 . Registration of Transfer.
The City will cause to be kept at the office of the
City Clerk a Note Register in which, subject to such reasonable
regulations as it may prescribe, the City shall provide for the
registration of transfers of ownership of the Note. The Note
shall be transferable upon the Note Register by the Lender in
person or by its agent duly authorized in writing, upon
surrender of the Note together with a written instrument of
transfer satisfactory to the City Clerk, duly executed by the
Lender or its duly authorized agent. Upon such transfer the
City Clerk shall note the date of registration and the name and
address of the nev Lender in the Note Register and in the
registration blanl appearing on the Note .
2-7 . Mutilated, Lost or Destroyed Note.
In case any Note issued hereunder shall become
mutilated or be destroyed or lost, the City shall, if not then
prohibited by law, cause to be executed and delivered, a new
Note of like outstanding principal amount, number and tenor in
exchange and substitution for and upon cancellation of such
mutilated Note, os in lieu of and in substitution for such Note
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destroyed or lost, upon the Lender ' s paying the reasonable
expenses and charges of the City in connection therewith, and
in the case of a Note destroyed or lost, the filing with the
City of evidence satisfactory to the City that such Note was
destroyed or lost, and furnishing the City with indemnity
satisfactory to it. if the mutilated, destroyed or lost Note
has already matured or been called for redemption in accordance
with its terms it shall not be necessary to issue a new Note
prior to payment.
2-8. Ownership of Note.
The City may deem and treat the person in whose name
the Note is last registered in the Note Register and by
notation on the Note whether or not such Note shall be overdue,
as the absolute owner of such Note for the purpose of receiving
payment of or on account of the Principal Balance, redemption
price or interest and for all other purposes whatsoever, and
the City shall not be affected by any notice to the contrary.
2-9 . Limitation on Note Transfers .
The Note has been issued without registration under
state or other securities laws, pursuant to an exemption for
such issuance; and accordingly the Note may not be assigned or
transferred in whole or part, nor may a participation interest
in the Note be given pursuant to any participation agreement,
except in accordance with an applicable exemption from such
registration requirements.
2-10. Issuance of New Notes.
Subject to the provisions of Section 2-9, the City
shall, at the request and expense of the Lender issue new
notes, in aggregate outstanding principal amount equal to that
of the Note surrendered, and of like tenor except as to number,
principal amount,, and the amount of the monthly installments
payable thereunder, and registered in the name of the Lender or
such transferee as may be designated by the Lender.
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ARTICLE THREE
GENERAL COVENANTS
3-1 . Payment of P rincipal and Interest.
The City covenants that it will promptly pay or cause
to be paid the principal of and interest on the Note at the
place, on the dates, solely from the source and in the manner
provided herein and in the Note . The principal and interest
are payable solely from and secured by revenues and proceeds
derived from the Loan Agreement, the Pledge Agreement, the
Mortgage, the Guaranty and the Assignment of Leases and Rents,
which revenues and proceeds are hereby specifically pledged to
the payment thereof in the manner and to the extent specified
in the Note, the Loan Agreement, the Pledge Agreement, the
Mortgage, the Guaranty and the Assignment of Leases and Rents;
and nothing in the Note or in this Resolution shall be
considered as assigning, pledging or otherwise encumbering any
other funds or assets of the City.
3-2 . Performance of and Authority for Covenants .
The City covenants that it will faithfully perform at
all times any and all covenants , undertakings, stipulations and
provisions contained in this Resolution, in the Note executed,
authenticated and delivered hereunder and in all proceedings of
the City Council pertaining thereto; that it is duly authorized
under the Constitution and laws of the State of Minnesota
including particularly and without limitation the Act, to issue
the Note authorized hereby, pledge the revenues and assign the
. Loan Agreement in the manner and to the extent set forth in
this Resolution, the Note, the Loan Agreement and the Pledge
Agreement; that all action on its part for the issuance of the
Note and for the execution and delivery thereof has been duly
and effectively taken; and that the Note in the hands of the
Lender is and will be a valid and enforceable special limited
obligation of the City according to the terms thereof.
3-3 . Enforcement and Performance of Covenants.
The City agrees to enforce all covenants and
obligations of the Borrower under the Loan Agreement and
Construction Loan Agreement, and to perform all covenants and
other provisions pertaining to the City contained in the Note,
the Loan Agreement and the Construction Loan Agreement and
subject to Section 3--4 .
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3-4 . Nature of Security.
Uotwithstand.ing anything contained in the Note, the
Mortgage, the Assignment of Leases and Rents, the Loan
Agreement, the Pledge Agreement or any other document referred
to in Section 2-4 to the contrary, under the provisions of the
Act the Note may not be payable from or be a charge upon any
funds of the City other than the revenues and proceeds pledged
to the payme-nt thereof, nor shall the City be subject to any
liability thereon, nor shall the Note otherwise contribute or
give rise to a pecuniary liability of the City or, to the
extent permitted by law, any of the City' s officers, employees.
and agents. No holder of the Note shall ever have the right to
cornpel any exercise of the taxing power of the City to pay the
Note or the interest thereon, or to enforce payment thereof
against any :property of the City other than the revenues
pledged under the Pledge Agreement; and the Note shall not
constitute a charge, lien or encumbrance, legal or equitable,
upon any property of the City; and the Note shall not
constitute a debt of the City within the meaning of any
constitutional or statutory limitation; but nothing in the Act
impairs the sights of the Lender to" enforce the covenants made
for the security thereof as provided in this Resolution, the
Loan Agreement, the Pledge Agreement, the Mortgage, the
Assignment of Leases and Rents , the Construction Loan
Agreement, the Guaranty and in the Act, and by authority of the
Act the City has made the covenants and agreements herein for
the benefit of the Lender; provided that in any event, the
agreement of the City to perform or enforce the covenants and
other provisions contained in the Note, the 'Loan Agreement, the
Pledge Agreement and the Construction Loan Agreement shall be
subject at all times to the availability of revenues under the
Loan Agreement sufficient -to pay all costs of such performance
or the enforcement thereof, and the City shall not be subject
to any personal or pecuniary liability thereon.
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ARTICLE FOUR
MISCELLANEOUS
4-1 . Severability.
If any provision of this Resolution shall be held or
deemed to be or shall, in fact, be inoperative or unenforceable
as applied in any particular case in any jurisdiction or
jurisdictions or in all jurisdictions or in all cases because
it conflicts with any provisions of any constitution or statute
or rule or public policy, or for any other reason, such
circumstances shall not have the effect of rendering the
provision in question inoperative or unenforceable in any other
case or circumstance, or of rendering any other_ provision or
provisions herein contained invalid, inoperative, or
unenforceable to any extent whatever. The invalidity of any
one or more phrases, sentences, clauses or paragraphs in this
Resolution contained shall not affect the remaining portions of
this Resolution or any part thereof .
4-2 . Authentication of T ranscript.
The officers of the City are directed to furnish to
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Bond Counsel certified copies of this Resolution and all
documents referred to herein, and affidavits or certificates as
to all other matters which are reasonably necessary to evidence
the validity of the Note. All such certified copies,
certificates and affidavits, including any heretofore
furnished, shall constitute recitals of the City as to the
correctness of all statements contained therein.
4-3 . Registration of Resolution.
The City Clerk is authorized and directed to cause a
copy of this Resolution to be filed with the County Auditor of
Hennepin County, and to obtain from said County Auditor a
certificate that the Note as a bond of the City has been duly
entered upon his bond register.
4-4 . Authorization to Execute Agreements .
The forms of the proposed Loan Agreement, the Pledge
Agreement, the Construction Loan Agreement, the Guaranty, the
Mortgage and the Assignment: of Leases and Rents are hereby
approved in substantially the form heretofore presented to the
City Council together with such additional details therein as
may be necessary and appropriate and such modifications
thereof, deletions therefrom and additions thereto as may be
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necessary and appropriate and approved by Bond Counsel prior to
the execution of the documents , and the Mayor and City Clerk of
the City are authorized to execute the Loan Agreement, the
Pledge Agreement and the Construction Loan Agreement in the
name of and on behalf of the City and such other documents as
Bond Counsel consider appropriate in connection with the
issuance of the Note. In the event of the absence or
disability of the Mayor or the City Clerk such officers of the
City as, in the opinion of the City Attorney, may act in their
behalf, shall without Further act or authorization of the City
Council do all things and execute all instruments and documents
required to be done or executed by such absent or disabled
officers . 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.
Adopted: December It , 1981
/�0
Ma r t e city of
TT-den Prairie
Attest:
City,' ex
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