Loading...
#82-107 10-19-82 Issue Revenue Bonds Loan Agreement428 Resolution 82-107 October 19, 1982 Member Johnson introduced and read the following resolution and moved its adoption: RESOLUTION AUTHORIZING THE SALE AND ISSUANCE OF INDUSTRIAL DEVELOPMENT REVENUE BONDS UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT TO FINANCE A PROJECT THEREUNDER, SECURED BY PAYMENTS TO BE RECEIVED PURSUANT TO A LOAN AGREEMENT AND A PLEDGE AND ASSIGNMENT OF THE CITY'S INTEREST IN THE LOAN AGREEMENT AND PAYMENTS THEREUNDER TO A TRUSTEE, AND AUTHORIZING THE EXECUTION OF DOCUMENTS BE IT RESOLVED by the City Council of the City of Golden Valley, Minnesota (the City), as follows: Section 1. Authorization and Recitals. 1.01. General Authority. The City is authorized by Minnesota Statutes, Chapter 474, as amended the Act), to issue its revenue bonds and to make secured or unsecured loans to finance the acquisition of real property and the acquisition or construction of buildings and improvements on such real property and the istallation of machinery and equipment of any and all kinds and any other personal properties deemed necessary in connection with a project, as defined in the Act. 1.02. Proposed Project and Bonds. Graco, Inc. a Minnesota corporation, has proposed that the City acting under and pursuant to the Act, issue its $6,000,000 Industrial Development Revenue Bonds (Graco Inc. Project), Series 1982 (the Bonds) for the purpose of defraying the costs of the acquisition and construction of a project consisting of one or more buildings, related access and parking facilities, and other improvements and equipment, machinery and other items of personal property constructed or installed thereon suitable and to be used by the Company as an office building (the Project) within the City. Pursuant to the proposal the City will loan the proceeds of the Bonds to the Company and the Company will agree to make payments sufficient to pay the principal of and interest on the Bonds. The City will assign its interest in the Loan Agreement (as hereinafter defined) to a Trustee (as hereinafter defined). The Bonds will be purchased by Bankers Trust Company, of New York, New York (the Purchaser) pursuant to a Bond Purchase Agreement (as hereinafter defined). 1.03. Prior Approval. On March 16, 1982, this Council adopted a resolution giving preliminary approval to the Project and authorizing preparation of necessary documents (the Resolution). 1.04. Project Costs. The Company has advised this Council and this Council hereby finds that the estimated costs of the Project at the present time exceed $6,000,000. Pursuant to the Loan Agreement, all costs of the Project in excess of the proceeds of the Bonds available therefore are required to be paid by the Company. 1.05. Documentation. Forms of the following documents relating to the Project haveeeT n prepared and submitted to this Council and are hereby directed to be filed with the City Clerk. (a) a Loan Agreement (the Loan Agreement), to be dated as of October 1, 1982, proposed to be made and entered into between the City and the Company pursuant to which the City loans the proceeds of the Bonds to the Company. 1 Resolution 82-107 - Continued October 19, 1982 429 2A (b) as Indenture of Trust (the Indenture), to be dated as of October 1, 1982, proposed to be made and entered into between the City and the Northwestern National Bank of Minneapolis, as trustee (the Trustee), creating and authorizing the issuance of and establishing the terms and conditions of the Bonds; (c) a Mortgage Agreement (the Mortgage), to be dated as of October 1, 1982, proposed to be made and entered into between the Company and the Trustee, whereby the Company will mortgage the real property included in the Project to the Trustee to secure the Bonds and the Company's obligations under the Loan Agreement; and (d) a Bond Purchase Agreement (the Bond Purchase Agreement), to be dated as of October 1, 1982, proposed to be made and entered into between the City, the Company, and the Purchaser, pursuant to which the Purchaser agrees to purchase the Bonds. Section 2. Findings. It is hereby found, determined and declared that: (a) based on representations made to the City by the Company, the Project, as defined herein and in the Loan Agreement, constitutes a project authorized by Section 474.02, Subdivision la of the Act; (b) the purpose of the Project is and the effect thereof will be to promote the public welfare by encouraging and retaining the location, retention and development of economically sound industry and commerce within the City so as to prevent, so far as possible, the emergence of blighted and marginal lands and areas of chronic unemployment; by promoting the use of available resources of the community thereby retaining the benefit of its existing investment in educational and public service facilities; by discouraging the movement of talented, educated personnel of mature age to other areas, thus preserving the economic and human resources needed as a base for providing governmental services and facilities; and by encouraging more intensive development of land in the City to provide an adequate and better balanced tax base to finance the increase in the amount and cost of governmental services; (c) the Project is to be located in the City, at a site which is readily accessible to employees residing within the City and the surrounding community; (d) the Project when completed will add to the tax base of the City and overlapping tax jurisdictions; (e) the Project has been approved by the Commissioner of Energy, Planning and Development of the State of Minnesota, as tending to further the purposes and policies of the Act; (f) the financing of the Project, the issuance and sale of the Bonds in the principal amount of $6,000,000 the execution and delivery of the Loan Agreement, the Indenture and the Bond Purchase Agreement, and the performance of all covenants and agreements of the City contained in the Loan Agreement, the Indenture and the Bond Purchase Agreement and of all other acts and things required under the constitution and laws of the State of Minnesota to make the Loan Agreement, the Indenture, the Bond Purchase Agreement and the bonds valid and binding obligations in accordance with their terms, are authorized by the Act; 430 Resolution 82-107 - Continued October 19, 1982 (g) it is desirable that the Bonds be issued by the City upon the terms set forth in the Indenture, under the provisions of which the City's interest in the Loan Agreement and the payments thereunder will be pledged to the Trustee as security for the payment of the principal, premium, if any, and interest on the Bonds; (h) the loan payments contained in the Loan Agreement are fixed, and are required to be revised from time to time as necessary, so as to produce income and revenue sufficient to provide for prompt payment of principal of and interest on all bonds issued under the Indenture when due; and the Loan Agreement also provides that the Company is required to pay all expenses of the operation and maintenance of the Project, including, but without limitations, adequate insurance thereon and insurance against all liability for injury to persons or property arising from the operation thereof, and all taxes and special assessments levied upon or with respect to the Project site and payable during the term of the Loan Agreement; (i) under the provisions of Section 474.10 of the Act and as provided in the Loan Agreement and Indenture, the Bonds are not to be payable from nor charged upon any funds of the City other than the revenue pledged to the payment thereof; the City is not subject to any liability thereon and no holders of the Bonds shall ever have the right to compel any exercise of the taxing powers of the City to pay any of the Bonds or the interest thereon nor to enforce payment thereof against any property of the City; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City except its interest in the Loan Agreement; each Bond issued under the Indenture shall recite that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment thereof; and no Bond shall constitute a debt of the City within the meaning of any constitutional or statutory limitation. Section 3. Authorization and Approval of the Project, Loan Agreement, Indenture, Mortgage and Bond Purchase Agreement. The City is hereby authorized to provide for the acquisition, construction and equipment of the Project and to pledge and assign the revenues therefrom and its interest in the Loan Agreement, all as provided in the Loan Agreement and the Indenture. The forms of Loan Agreement, Indenture, Mortgage and Bond Purchase Agreement referred to in Section 1.05 are approved subject to such modifications as are deemed appropriate and approved by the City Attorney and the Mayor which approval shall be conclusively evidenced by execution of the Loan Agreement, the Indenture, the Bond Purchase Agreement and the Bonds by the Mayor and City Manager. The Mayor and City Manager are directed to execute the Loan Agreement, the Bond Purchase Agreement and the Indenture. Copies of all of the documents shall be delivered, filed and recorded as provided therein. The Mayor and City Manager are also authorized and directed to execute such other instruments as may be required to give effect to the transactions herein contemplated. Section 4. The Bonds, Terms, Sale and Execution. 4.01. Authorization. In anticipation of the collection of revenues of the Project, the City shall proceed forthwith to issue its Bonds in the form and upon the terms set forth in the Indenture and this resolution. The Bonds shall be dated as of the date of delivery thereof to the Purchaser, shall mature on December 1, 2002, and shall bear interest as set forth in Section 4.02 hereof. The Bonds are sold to the Purchaser at a price of their principal amount, plus accrued interest, and upon the terms specified in the Bond Purchase Agreement. Resolution 82-107 - Continued October 19, 1982 431 4.02. Interest Rates, Fixing of Rate. The Bonds shall bear interest at a floating rate as set forth in Section 3-1(f) of the Indenture, provided that a fixed rate of interest shall be established, in accordance with said Section 3-1(f), on or before December 1, 1992. In accordance with Section 3-1(f) (2) of the Indenture, the City, the Company and the Holders of the Bonds may, at any time prior to December 1, 1992, by unanimous consent, agree to fix the interest rate borne by the Bonds at a specific rate per annum; upon such agreement the Bonds shall bear interest at such fixed rate from the date mutually determined until paid or discharged. The City hereby agrees that, upon the request of the Company and with the consent of the Holders of the Bonds, the City will agree to fix the interest rate borne by the Bonds and will adopt such resolution and execute such supplemental indentures as are necessary to establish a fixed rate of interest for the Bonds pursuant to Section 3-1 (f) (2) of the Indenture. 4.03. Exeuction. The Mayor and City Manager are hereby authorized and directed to execute the Bonds as prescribed herein and in the Indenture and to deliver them to the Trustee, together with a certified copy of this resolution, the other documents required in the Indenture, and such other certificates, documents and instruments as may be appropriate to effect the transaction herein contemplated. The Trustee is hereby appointed authenticating agent pursuant to Minnesota Statutes, Section 475.55, Subdivision 1. 4.04. City Representative. The City Manager is hereby designated as Municipal Representative, and the Mayor as alternate Municipal Representative, for all purposes of the Loan Agreement and Indenture, with full authority to do, on behalf of the City, all those things required or authorized in the Loan Agreement and Indenture by action or upon certification of the Municipal Representative. 4.05. Statement of Election. The Mayor and City Manager are authorized and directed to execute and file with the Internal Revenue Service a statement of the City's election to issue industrial development revenue bonds in an amount in excess of $1,000,000 but not more than $10,000,000, in such form as may be approved by the City Attorney, in order to satisfy the Bonds as an "exempt small issue" under Section 103(b) (6) (D) of the Internal Revenue Code of 1954, as amended, and Treasury Regulations 1.103-10 (b) (2). 4.06. Modifications, Absence of Officers. The approval hereby given to the various documents referred to above inc u es an approval of such additional details therein as may be necessary and appropriate and such modifications thereto, deletions therefrom and additions thereto as may be necessary and appropriate and approved by the City Attorney prior to the execution of the documents. 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. In the absence of the Mayor or City Manager, any of the documents authorized by this resolution to be executed, may be executed by the acting Mayor or Deputy City Manager, respectively. Cl 432 3h Resolution 82-107 - Continued ATTEST: John Mup U City Clerk October 19, 1982 Ros maryhorse., Mayor c The motion for the adoption of the foregoing resolution was seconded by Member Stockman and upon a vote being taken thereon, the following voted in favor thereof: Anderson, Johnson, Mitchell, Stockman and Thorsen, and the following voted against the same: none, whereupon said resolution was declared duly passed and adopted, signed by the Mayor and her signature attested by the City Clerk. 1