Loading...
HomeMy WebLinkAboutResolution - 83-230 - Final Approval of MIDB's - Cotton-Hagen - $500,000 - 09/20/1983 J _? � -3 0 A PFSOLIITION PROVIDING FOR THE ISSUANCE AND SALE OF COMMERCIAL DEVELCPMENT REVENUE NOTE PURSUANT TO CHAPTER 474 , MINNESOTA STATUTES , TO PROVIDE FUNDS TO BE LOANED TO COTTON-HAGEN COMPANY FOR INDUSTRIAL DEVELOPMENT PROJECT BE IT RESOLVED by the City 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 Chapter 474 , Minnesota Statutes , as amended ( the "Act" ) , authorized to issue and sell its revenue bonds or notes for the purpose of financing the cost of acquisition and construction of authorized projects and to enter into contracts necessa.ry or convenient in the exercise of the powers Rr_ znted by the Act and to pledge revenues of the project and otherwise secure such bonds or notes . 2 . Authorization of Note. The Citv Council herebv determines that it is d es4rable and expedient to authorize , and the Citv Council does herebv authorize , the issuance of a $500 ,000 City of Eden Prairie Commercial Development Revenue Note (Cotton-Hagen Comrnantr Project) (the "Note" ) , in the form attached hereto as Exhibit A, pursuant to the Act to provide funds -to be .loaned to Cotton-Hagen Company , a Minnesota general partnership (the "Borrower_ " ) , to acquire land in the City and to construct thereon a building to be owned by the Borrower and leased to R.M. Cotton Co . and Data Recognition Corporation , each a Minnesota corporation (together the "Lessees" ) , and to be used by each of the Lessees as an office and warehouse facility, and to acquire and install necessary building service equipment therein (the "Project" ) . 3 . Documents Presented . Forms of the following documents relating to the Bond and the Project have been submitted to and examined by the City Council and are now on file in the office of the City Clerk : (a) Loan Agreement (the "Loan Agreement" ) , dated as of September 1 , 1983 , by and between the Citv and the Borrower whereby , among other things , the City agrees to make a loan to the Borrower_ of the proceeds of the sale of the Bond and the Borrower covenants to complete the Project and to pav amounts sufficient to provide for the prompt payment of the principal of and interest on the Note ; and (b) Construction Loan P.greement (the "Construction Loan Agreement" ) dated the date of delivery of the Bond , among the City , the Borrower and Norwest Bank_ MetroWest, National Association ( the "Lender" ) , whereby, subject to the terms and conditions therein set forth , the Lender agrees to purchase the_ Note from the City and to advance the proceeds thereof to the Borrower; and (c) Combination Mortgage , Security Agreement and Fixture Financing Statement (the "Mortgage" ) dated the date of delivery of the Note , by and between the Borrower and the Lender , whereby the Borrower mortgages to the Lender the Project Facilities , all as further described in the Mort- gage , as securit;v for the Note (this document not to be executed by the City) ; and (d) Assignment of Leases and Rents (the "Assignment" ) dated the date of delivery of the Note , from the Borrower to the Lender , whereby the Borrower assigns to the Lender its interests in all leases and rents derived frcm the Project Facilities (this document not to be executed by the City) ; and (e) Guaranty Agreement (the "Guaranty" ) to be dated the date of delivery of the Note , from each of the Lessees and each of the general partners of. the Borrower (the "Guarantors" ) to the Lender , whereby the Guarantors unconditionally guarantee payment of the principal. of, premium, if any , and interest on the Note ( this document not to be executed by the City) ; and ( f) Assignment and Pledge Agreement (the "Pledge Agreement" ) , substantially in the form attached hereto as Exhibit B , dated as of September 1 , 1983 , whereby the City assigns to the Lender all of its interest in the Loan Agreement and Loan Repayments of. the Borrower payable thereunder (except its rights under Sections 4 . 02, 6 . 01 , 7 . 04 and 7 . 05) , for the purpose of securing the Note . 4 . Findings . It is hereby found , determined and declared that: (a) The Project , as described in paragraph 2 hereof and in the Loan Agreement , constitutes a project authorized by 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 : prevent- ing the emergence of blighted and marginal lands and areas of chronic unemployment ; preventing economic deterioration; the development' of sound ind.ustrk., and commerce to use the available resources or the community ; -in order to retain the -2- benefit of the communitv ' s existing investment in educational and public service facilities ; and halting the movement of talented, educated personnel to other areas and thus pre- serving the economic and human resources needed as a base for providing governmental services and facilities ; and providing a more adequate tax base to finance the costs of governmental services . (c) The Project has been approved by a preliminary .resolution of the City Council duly adopted July 19 , 1983 , and by the Minnesota Energy and Economic Development Authority. (d) The issuance and sale of. the Note , the execution and delivery of the Loan Agreement , the Pledge Agreement and the Construction Loan Agreement and the performance of all covenants and agreements of the City contained in the Note , the Loan Agreement , the Pledge Agreement and the Con- struction Loan Agreement and of all other acts and things required to make the Note , the Loan Agreement , the Pledge Agreement and the Construction Loan Agreement valid and binding obligations of the City in accordance with their terms , are authorized by the Ac-`. (e) There is no litigation pending or , to the best of its knowledge threatened, against the City relating to the Project or to the Note or Loan Agreement , or questionina the organization of the City or its power or authority to issue the rote or execute and deliver the Loan Agreement , the Pledge Agreement and the Construction Loan Agreement . ( f) The execution , delivery and performance of the City ' s obligations under the Note, the Loan Agreement , the Pledge Agreement and the Construction Loan Agreement have been fully authorized by all reauisi.te action , including adoption of this resolution (provided that this finding is made solely for the purpose of estopping the City from denying the validity or enforceability of the Loan Agreement , the Pledge Agreement , the Construction Loan Agreement or the Note by reason of the existence of any facts contrary to this finding) , and do not and will not violate anv order or judgment of any court or other agency of government in any litigation to which the City is a party or by which it is bound , or anv 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 , (d) The Loan Agreement provides for payments by the Borrower_ to the Lender as Holder of the Note for the account -3- of the City of such amounts as will be sufficient to pay the principal. of and interest on the Note when due . No reserve funds are deemed necessary for this purpose . The Loan Agreement obligates the Borrower to provide for the opera- tion and maintenance of the Project Facilities , including adequate insurance , taxes and special assessments . (h) Under the provisions of Section 474 . 10 of the Act , and the Note shall recite that , the Note is not to be payable from nor a charge upon any funds of the City other than the revenue under the Loan Agreement pledged to the payment thereof , nor is the City subject to and- liability thereon ; no Holder of.. the Note shall ever have the right to compel the exercise of the taxing power of the City to pay the Note or the interest thereon ; and the Note does not constitute- an indebtedness of the City within the meaning of any constitutional or statutory limitation . ( i ) No member of the Citv Council ( i) has a direct or indirect interest in the Project , the Loan Agreement , the Construction Loan Agreement, the Pledge Agreement or the Note , ( ii) owns any capital stock of or other interest in the Project , the Borrower , either Lessee or the Lender , ( iii) is an officer , director or partner of either the Borrower , either Lessee , or the Lender , ( iv) will be involved in supervising the completion of the Project on behalf of the Borrower , or (v) will receive any commission , bonus or other remuneration for or in respect of the Pro- ject , the Loan Agreement , the Construction Loan Agreement or the Note . 5 . Approval and Execution of Documents . The forms of Loan Agreement , Pledge Agreement and Construction Loan Agreement referred to in paragraph 3 are approved. The Loan Agreement, Pledge Agreement and Construction Loan Agreement shall be executed in the name and on behalf of the Citv by the Mavor and the City Manager , or shall be executed by other appropriate officers of the City authorized to execute documents on behalf of such officers , 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 e:cecution thereof. The Mortgage , the Guaranty and the Lease Assignment may contain such revisi.ons as may be approved by the Lender and the Borrower . 6 . Approval of Terms and Sale of Note . The City shall proceed forthwith as hereinafter provided to issue the tTote , in the authorized principal amount of $500 , 000 , substan- tially in the form, maturing , bearing interest , payable in the installments and otherwise containing the provisions set forth in the form of Note attached hereto as Txhibit A , which terms and -4- provisions are hereby approved and incorporated in this Bond Resolution and made a T)art hereof . A single dote , substantially in the form of Exhibit A to this Bond Resolution , shall be issued and delivered to the Lender in the authorized principal amount of. $500 , 000 , as authorized by the Act , and the principal of and interest on the Note shall be payable at the office of the Tender in Hopkins , Minnesota . The proposal of the Lender to purchase the ?Mote at a purchase price equal to 1000 of the principal amount thereof is hereby found and determined to be reasonable and is hereby accepted. The Note shall be issued upon the paynrient by the Lender of the purchase price therefor; upon the execution and delivery of the Loan Agreement , the Pl.edcre Agreement, the Construction Loan Agreement, the Mortgage , the Assignment and the Guaranty ; upon the delivery of the approving legal opinion of Faegr.e & Benson, as bond counsel ; and upon such other conditions , includ- ing the furnishing of customary certificates and affidavits , as may be required by bond counsel or the Lender . Pursuant to the Construction. Loan Agreement , the Lender has agreed to make Advances of the Note proceeds to the Borrower pursuant to the Construction Loan Agreement to pay the costs of the Project . i 7 . Execution and deli'Te.ry of Note . The Note may be in typewritten or printed form and shall be executed by the manual signatures of the Mayor and the City Manager, and the official seal of the City shall be affixed thereto . When so prepared and executed , the Note shall be delivered to the Lender upon payment of the purchase price , and upon receipt of the signed legal opinion of raegre & Benson , of Minneapolis , Minnesota , bond counsel , pursuant to the Loan Agreement . The Note 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 . S . Registration Records . The Citv Clerk , as bond registrar , shall keep a bend register in which the. City shall provide for the registration of the Note and for transfers of the Note . The principal of and interest on the dote shall be paid to the Lender or other Holder entitled thereto at its address set forth on such bond register in Federal or other immediately available funds . The City Clerk is authorized and directed to deliver a certified copy of this Bond Resolution to the County Auditor of Hennepin County , together with such other information as the County Auditor may require , and obtain the certificate of the Countv Auditor as to entry of the Note on his bond register as required by the Act and Section 475 . 63 , Minnesota Statutes . 9 . Mutilated , Lost , Stolen or Destro'ved Note . If the Note is mutilated , lost , stolen or destroyed , the City may execute and deliver to the Holder a new Note of like amount , date , number and tenor as that mutilated , lost , stolen or destrroved; provided that , in the case of mutilation , the mutilated Note shall first be surrendered to the City , and in the case of a lost , stolen or destroyed Note , 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 , together with indemnity satisfactory to them. The Citvv and the Borrower may charge the Holder with their reasonable fees and expenses in replacing any mutilated , lost , stolen or destroyed Note . 10 . Transfer of Note ; Person Treated as Holder . The Note shall be transferable by the Bolder on the bond register of the City , upon presentation of the Note for notation of such transfer thereon at the office of the City Clerk , as bond regis- trar , accompanied by a written instrument of transfer in form satisfactory to the City Clerk duly executed by the Holder or its attorney dul-,;, authorized in writing . The Note shall continue to be subject to successive transfers , at the option of the Holder of the Note . No service charge shall be made for any such transfer , but the City Clerk may require payment of a sum suffi- cient to cover any tax or other governmental charge payable in ±, connection therewith . The person in whose name the Note shall be issued or , if transferred , shall be registered from time to time shall be deemed and regarded as the absolute owner and Holder thereof for all. purposes , and payment of or on account of the principal of and interest on the Mote 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 City Clerk , the Borrower , nor the Lender shall be affected by anv notice to the contrary . All such payments shall be valid and effectual to satisfy and discharge the liability upon the Note to the extent of the sum or sums so paid . The Note shall be initially regis- tered in the name of the Lender . 11 . Amendments , Changes and. Modifications to Loan Agreement , P.ledc7e Agreement , Construction Loan Agreement and Bond Resolution . Except pursuant to Section 8 . 04 of the Loan Agree- ment , the City shall not enter into or make any change , modifica-- tion , alteration or termination of the Loan Agreement , Pledge Agreement, Construction Loan Agreement or this Bond Resolution . 12 . Pledge to Holder . Pursuant to the Pledge Agree- ment , the City shall_ pledge and assig n to the Lender and its permitted successor_ Holders of the Note all interest of the Citv (other than certain rights to indemnity and repayment of advances and expenses) in the revenues of the Project and the Project l Loan Repavr^ents to be made by the Facilities , .including al. { E3orro;ac-r tinder '*.he- Loan Agreement . 17.1_ collections of monevs by -G- r the City in any proceeding for enforcement of the obligations of the Borrower under the Loan Agreement shall be received , held and applied by the City .for the benefit of the Holder of the Note. 13 . Covenants with Holders ; Enforceabilitv. All provisions of the Note and of this Bond Resolution and all representations and undertakings by the City in the Loan Agree- ment are hereby_ declared to be covenants between the City and the Lender and its permitted successor Holders of the Note and shall be enforceable by the Lender or any Holder in a proceeding brought for that purpose , provided that no such covenant , representation or undertaking shall ever give rise to any general liability of the City, its employees , officers or agents or constitute a charge against its general credit or taxing powers . 14 . Authorized. Re2resentative . The City Clerk is hereby designated as the Authorized Municipal representative for all purposes of the Loan Agreement with full authority to do on behalf of the City_ all those things required or authorized by the Loan Agreement to be done by action or certificate of the Authorized Municipal Representative . 15 . Definitions and Interpretation . Terms not other- wise defined in this Bond Resolution but defined in the Loar. Agreement shall have the same meanings in this Bond Resolution and shall oe interpreted herein as provided therein . Notices may be given as provided in Section 9 . 01 of the Loan Agreement. In case any provision of this Bond Resolution is for any reason illegal or invalid or inoperable , such illegality or invalidity or inoperability shall not affect the remaining provisions of this Bond Resolution, which shall be construed or enforc`d as _f such illegal or invalid or inoperable provision were not con- tained herein . 16 . Certifications . The Mayor , City Clerk, City Manager and other officers of the City are authorized and directed to prepare and furnish to Faegre & Benson, bond counsel , to the Borrower , to the Lender and to counsel for the Borrower and the Lender, certified copies of all proceedings and records of the City relating to the Project and the Note , and such other affida- vits and certificates as may be requi.red 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. - 7- EXFIBT"' A T(; BOND RESOLUTION (Form of NTote) UNITED STATES OF AMERICA ,STATE OF MINNESOTA COUNTY OF HENNEPIN CITY OF EDEN PRAIRIE Commercial. Development Revenue Note (Cotton-Hagen Company Project) No . R- 1. $500 , 000 The Citv of ?der. Prairie , a municipal corporation in the Count,,.7 of Hennepin and State of Minnesota (the "City" ) , for value received , herebe.7 promises -o pav , but solely from the sources and in the manner hereinafter provided , to Nor-west Bank t,letroWest , 'National. Association ( the "Lender" ) , or registered assigns , the principal sum of Five Hundred Thousand and Zero Hundredths Dollars ( $ 500 ,000) , on the tenth anniversary of the t date hereof , unon the presentation and surrender hereof , and to make payments of such principal sum in installments as hereinafter_ provided , and to pay to the owner_ hereof interest on the outstanding and unpaid principal hereof from the date hereof until said principal is paid, at the rate or rates hereinafter set forth . .Interest shall. he calculated on the basis of a 360 day year but charged for actual days elapsed . Interest only on this Note shall. be paid on 1 , 1983 , and monthly thereafter on the first day of each month to and including the first day of the sixth calendar month following the date hereof_ , and thereafter interest and principal shall be payable in installments on the first day of each succeeding month to maturity as hereinafter provided. From the date hereof to and including_ the third anniversary of the last day of the same calendar month as the month set forth in the date hereof , this Note shall. bear interest at the rate of Ten percent ( 10 . 00%) per annum. From the first day of the first calendar month following the third anniversary hereof (the "First Adjustment Date" ) , to and until the day immediately preceding the third anniversary of the First Adjustment Date , this Note shall bear interest at a rate equal to the average of the three 3-year Treasury Note .rates set as a result of the three Treasury Note auctions next preceding the First. Adjustment Date , as published in the Wall Street Journal_ , plus that number of basis points by which 10 . 00^: exceeds such average of the three 3-year Treasury Note rates set as a result of the three auctions next preceding the date hereof 9 ( such number of 13asi.s rni.nts hereinafter_ referred to rIs the i "Additional Interest Factor" ) , provided that in no event shall such interest rate for the period from the First Adjustment Date to the day immediately preceding the Second Adjustment Date mentioned below exceed :30 . 00% per annum . From the third anni.versary of the First Adjustment Date (the "Second Adjustment Date" ) to and including the day immediately preceding the third anniversary of the Second Adjustment Date , this Note shall bear interest at a rate equal. to the average of the three 3-yeas Treasury Note rates set as a result of the three Treasury Note auctions next preceding the Second Adjustment Date , as published in the Wall Street Journal, plus the Additional Interest Factor , provided that in no event shall such interest rate for the period from the Second Adjustment Date to the day immediately preceding the Third Adjustment. Date mentioned below exceed 30 . 00% per annum. From the third anniversary of the Second Adjustment Date (the "Third Adjustment Date" ) -to and including the tenth anniversary of the date hereof , this Note shall bear interest at a .rate equal to the average of the three 3-vear_ Treasury Note rates set as a result of the three Treasury Note auctions next preceding the Third Adjustment Date , as published in the Wall Street Journal , plus the Additinnal Tn terest Factor , provided that in no event shall such interest rate for the period from the Third Adjustment Date to maturity exceed 30 . 00% per annum. { Commencing on the first day of the seventh calendar month following the date hereof_ , principal and interest shall be payable in 113 monthly installments , payable on the first day of each month to and including the first day of the same month as the month during which the tenth anniversary hereof_ occurs . On the tenth anniversary of the date hereof , all principal hereof and interest hereon shall be due and payable in full . Principal and interest shall be paid to the registered owner hereof in lawful money of the United States at its address set forth on the registration book of the City . The amount of each monthly installment payable hereunder shall be the amount determined by the Lender to be necessary to amortize the entire principal hereof , together with accrued interest , in 360 equal install- ments , determined in accordance with the rate of interest then in effect hereunder . As and when the interest rate hereon is adjusted on the First, Second and Third Adjustment Dates , the amount of monthly installments due hereunder_ shall be adjusted correspondingly , based upon the rate of interest in effect on such dates . Notwithstanding anything herein to the contrary, if there shall. occur a Determination of Taxability , as defined in the hereinafter-mentioned Loan Agreement , the interest rate hereon shall be increased automatically to a rate equal to five percent in excess of the rate publicly announced from time to time by -the Lender as its base lending rate , payable from the ' Date of Taxability, as defined in the Loan Agreement, until payment in full of the principal balance hereof. . In the event of -2- a Determination of Taxability, the Borrower mentioned below shall forthwith upon notification from the Holder pay all additional interest accrued hereunder from the Date of Taxability and , thereafter , the Borrower shall pay such additional. interest at the same time and as part of the Loan Repayments required under the Loan Agreement in order to meet monthly interest payments due hereunder. This Nlote is issued pursuant to the Minnesota Municipal Industrial Development Act , Chapter 474 , Minnesota Statutes , as amended (the "Act" ) , and in conformity with the provisions , restrictions and limitations thereof . This Note , the interest hereon and any premium or other amounts payable hereunder. , however designated , are not payable from nor charged upon any funds other than amounts pa-gable by Cotton-Hagn Company , a Minnesota general partnership (the "Borrower" ) , pursuant to the Loan Agreement , hereinafter. -mentioned, which are pledged to the payment hereof , and , in an event of default, moneys derived fro-In foreclosure or other enforcement of the hereinafter-mentioned Mortgage , Lease Assignment or. Guaranty ; the City is not subject to any .liability hereon ; no Holder of this Note shall ever have the right to compel the exercise of the taxing power of th-- City to pay this Note or the interest hereon , nor to enforce payment hereof against any property of the City; and this Note , the 1 interest hereon and any premium or other amounts payable here-- under , however designated , do not constitute an indebtedness of the City• within the meaning of any constitutional or statutory limitation . The provisions of this paragraph shall , for all purposes of this ?\Tote , be controlling and be given full force and effect , notwithstanding anything else in this Note to the con- trary . This Note is a special obligation of the City in the principal_ amount of $500 , 000 , and has been authorized by law to be issued for the purpose of funding a loan from the City to the Borrower to finance the acquisition of land in the City and the construction, thereon of a building to be owned by the Borrower and leased to R.M . Cotton Co . and Data Recognition Corporation , each a Minnesota corporation (together the "Lessees" ) , to be used by each of the Lessees as an office and warehouse facility , as authorized by the Act (rhe "Project" ) This dote is issued pursuant to a Bond Resolution of the City duly adopted on September 20 , 1983 , a Loan Agreement (the "Loan Agreement" ) dated as of September 1 , 1983 , by and between the City and the Borrower , and a Construction Loan Agreement ( the "Construction Loan Agreement" ) dated the date hereof , by and among the City , the Borrower , and the Lender. This Note is secured by the Bond Resolution , the I.,oan Agreement , the Construction Loan Agreement , a Pledge Agreement (the "Pl.edcre Agreement" ) dated as of Septemher 1 , 1983 , from the City to the Lender , a Combination Mortgage , Ser_ur_ .it- Agreement ant? Fi:ctur_e Financing Statement (. the -3- "Mortgage" ) dated the date hereof_ , from the Borrower to the Lender , an Assignment of Leases and Rents ( the "Lease Assignment" ) dated the date hereof , from the Borrower to the Lender , and a Guaranty Agreement dated the date hereof from each of the general partners of the Borrower to the Lender , to which Bond Resolution , Loan Agreement , Construction Loan Agreement , Pledge Aqreement , Mortgage , Lease Assignment and Guaranty and amendments thereof reference is hereby made for a description and limitation of the revenues and funds pledged and appropriated to the payment of this Note , the nature and extent of the security thereby created , the rights of the Holder of this Note , and the rights , immunities and obligations of the City thereunder . Certified copies of the Bond Resolution and executed counterparts of the Loan Agreement , the Construction Loan Agreement, the Pledge Agreement , the Mortgage , the Lease Assignment and the Guaranty are on file at the office of the City Clerk . This Note shall be subject to optional prepayment or redemption , in whole or in part, on any interest payment date at a prepayment price equal to the principal amount to be prepaid , plus accrued interest . Notice of any such prepayment or redemption shall be given to the owner or registered assigns of this Note by cer- tified or registered mail. , addressed to it at its; registered address , and shall be published , if required by law, in a finan- cial journal_ circulated in the English language in the City of Minneapolis , Minnesota , at least once , not less than thirty (30 ) days before the date so fixed for redemption . At the elate fixed for redemption , funds shall be paid to the owner hereof at its registered address , sufficient to pay this Note , accrued interest hereon , and any prepayment premium. Upon the happening of the above conditions , this Note thus called shall not bear interest after the date specified for redemption . This Note is transferable , as provided in the Bond Resolution , only upon the bond register of the City Clerk, as bond registrar , by the owner hereof in person or by his duly authorized attorney , as provided in the Bond Resolution . Tn case an Event of Default , as defined in the Loan Agreement , occurs , this Note and the Loan Repayments thereafter to become due under the Loan Agreement may become immediately due and payable , in the manner and with the effect and subject to the conditions provided in the Loan Agreement . The Holder of this Note shall have the right to enforce the provisions of the Bond Resolution , Loan Agreement , Construction Loan Agreement , Pledge Agreement , Mortgage , Lease Assignment and Guaranty. The term: and provisions of the Bond Resolution , Loan Agreement , Construction Loan. Agreement , Pledge Agreement , __q_ Mortgage , Lease Assignment and Guaranty, or of anv instrument supplemental thereto , may be modified or altered only pursuant to Section 8 . 04 of the Loan Agreement and paragraph 11 of the Bond Resolution. Any capitalized term used but not defined herein shall have the meaning set forth in the Loan Agreement, unless the context clearly requires other,,7ise. It is hereby certified and recited and the City Council has found : That the Project is an eligible "project" defined in Section 474 . 02 , Subd . la, of the Act ; that the issuance of this Note and the undertaking of the Project will promote the public welfare and carry out the purposes of the Act; that the Project has been approved by the Minnesota Energy and Economic Develop- ment Authority as tending to further the purposes and policies of the Act; that all acts , conditions and things required to be done precedent to and in the issuance of this Note have been properly done , have happened and have been performed in regular and due time , form and manner as required by law; and that this note does not constitute a debt of the City within the meaning of any constitutional or statutory limitation . IN WITNESS WHEREOF , the City of Eden Prairie , by its City Council , has caused this Note to be signed in its behalf by the manual signatures of its Mayor and City Manager and sealed with the corporate seal of the City , all as of the day of 1983 . ATTEST : / CITY 'OF DEN PRAIRIE B V tom- a or C y QQ L c:r2✓7 (SEAL' ) -5- i ASSIGNMENT For value received, the undersigned owner does hereby assign and transfer the foregoing Note to the named Assignee , and the undersigned City Clerk of the City of Eden Prairie , as bond registrar , hereby certifies that the foregoing Note has been transferred and registered on the bond register in the name of such Assignee . Name of Signature Signature of Date of Transfer Assignee of Owner Citv Clerk on Bond Register -6- EXHIBIT R TO BOND RESOI.,UTION ASSIGNMENT AND PLEDGE AGREEMENT This ASSICNYIENT AND nI,EDC:F AGRFEMENT is made as of the 1st day of September , 1983 , bet:-.een the CITY OF EDEN PRAIRIE , a rnunicipal corporation in the County of Hennepin and State of Minnesota (herein called the "City" ) and NORWEST BANK METROWEST , NATIONAL ASSOCIATION , a banking association having its principal office and place of business in Hopkins , Minnesota (herein called the "Bondholder" ) . Recitals The Citv has executed and delivered to the Bondholder its single fully registered Commercial Development Revenue Note (Cotton-Hagen Companv Project) in the principal amount of $500 , 000 ( the "Mote" ) , dated the date of deliver. ,,; thereof , issued pursuant to a -resolution adopted by the City Council of the City on September 20 , 1983 (the "Bond Resolution" ) . The proceeds of the Note have been loaned to Cotton-Hagen Companv , a Minnesota general partnership (the L "Borrower" ) , pursuant to a Loan Agreement dated as of September 1 , 1983 , between the Citv and the Borrower. The Note is pavable from and secured by the Loan Repay- ments to be made by the Borrower under the Loan Agreement and the Bondholder , as a condition to the purchase of the Note , has required the execution of this Assignment . ACCORDINGLY , as authorized by the Bond Resolution and in consideration of the premises and other good and valuable consideration , the receipt of which is hereby acknowledged , the City does hereby grant , transfer and assign to the Rondholder and its registered ass:Lgns of the Note , all of the right , title and interest of the Citv in the Loan Agreement and the Loan Repayments of the Borrower payable thereunder (except for the rights of the Citv under Sections 4 . 02 (b) , 6 . 01 , 7 . 04 and 7 . 05 thereof_ relating to expenses , indemnity and advances of the City) , and does hereby pledge and grant a security interest in all of its rights in and to the Loan Agreement and all revenues and income arising thereunder , all for the purpose of securing the Mote . TN WITNESS WHEREOF, the City has executed this Assian- mer_t and Pledge Agreement as of the date first above written . CITY OF ED.EN PRAIRIE Rv Mavor (Seal) And bv_ City Manager