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#82-114 11-16-82 Issue Revenue Bonds Development Project440 Resolution 82-114 November 16, 1982 Member Johnson introduced and read the following resolution and moved its adoption: RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF REVENUE BOND PURSUANT TO CHAPTER 474, MINNESOTA STATUTES, TO PROVIDE FUNDS TO BE LOANED TO H. I. ENTERPRISES, INC. FOR INDUSTRIAL DEVELOPMENT PROJECT BE IT RESOLVED by the City Council of the City of Golden Valley, 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 for the purpose of undertaking authorized projects and to enter into contracts necessary or convenient in the exercise of the powers granted by the Act and to pledge revenues of such projects. and otherwise secure such bonds. 2. Authorization of Project. The City Council hereby determines that it is desirable and expedient to authorize, and the City Council does hereby authorize, the issuance and sale of a revenue bond of the City pursuant to the Act to provide funds to be loaned to H. I. Enterprises, Inc., a Minnesota corporation (the "Borrower"), in order for the Borrower to partially finance the acquisition, construction and equipping of a building to be used as a retail convenience store and automobile service station facility (the "Project", as more fully defined in the Loan Agreement hereinafter mentioned"). 3. Documents Presented. Forms of the following documents relating to the Project and the financing thereof have been submitted to and examined by the City Council and are now on file in the office of the City Clerk: (a) Loan and Purchase Agreement (the "Loan Agreement") dated as of December 1, 1982, by and among the City, the Borrower and The Fifth Northwestern National Bank of Minneapolis (the "Lender"), whereby among other things, the City agrees to sell and the Lender agrees to purchase the City's $370,000 Industrial Development Revenue Bond (H. I. Enterprises, Inc. Project) (the "Bond"), the City agrees to make a loan to the Borrower of the proceeds of the sale of the Bond, and the Borrower covenants to pay amounts sufficient to provide for the full and prompt payment when due of the principal of, premium, if any, and interest on the Bond; and (b) Loan Agreement Assignment (the "Loan Agreement Assignment") dated as of December 1, 1982, from the City to the Lender, whereby the City assigns to the Lender all of its interest in the Loan Agreement and Loan Repayments of the Borrower thereunder (except its rights under Sections 5.02, 7.01, 8.04 and 8.05 thereof relating to idemnity, expenses and advances of the City), for the purpose of securing the full and prompt payment of the Bond; and (c) Combination Mortgage, Security Agreement and Fixture Financing Statement (the "Mortgage") dated as of December 1, 1982, from the Borrower to the Lender, whereby the Borrower grants a mortgage lien on and security interest in the Mortgaged Property, as defined therein, as further security for the full and prompt payment of the Bond (this document not to be executed by the City); and Resolution 82-114 - Continued November 16, 1982 (d) Guaranty Agreement (the "Guaranty") dated as of December 1, 1982, from Vasilios Bill Kottas and Beverly A. Kottas, as guarantors, to the Lender, whereby the guarantors unconditionally guarantee payment of the principal of, premium, if any, and interest on the Bond as the same become due and payable (this document not to be executed by the City); and (e) Combination Mortgage, Security Agreement and Fixture Financing Statement (the "Guarantors' Mortgage") dated as of December 1, 1982, from Vasilios Bill Kottas and Beverly A. Kottas, as mortgagors, to the Lender, whereby further security is granted for the obligations of the said mortgagors under the Guaranty (this document not to be executed by the City). 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 revenue-producing enterprise and is 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: preventing the emergence of blighted and marginal lands and areas of chronic unemployment; preventing economic deterioration; the development of sound industry and commerce to use the available resources of the community, in order to retain the benefit of the community's existing investment in educational and public service facilities; and halting the movement of talented, educated personnel to other areas and thus preserving the economic and human resources needed as a base for providing governmental services and facilities; and adding to the tax base of the City and the County and School District in which the Project will be located. (c) The Project has been approved by a preliminary resolution of the City Council duly adopted on March 16, 1982, and by the Commissioner of Energy, Planning and Development of the State of Minnesota, as tending to further the purposes and policies of the Act. (d) The issuance and sale of the Bond, the execution and delivery of the Loan Agreement and the Loan Agreement Assignment and the performance of all covenants and agreements of the City contained in the Bond, the Loan Agreement and the Loan Agreement Assignment and of all other acts and things required to make the Bond, the Loan Agreement and the Loan Agreement Assignment valid and binding obligations of the City in accordance with their terms, are permitted by the Act. (e) There is no litigation pending or, to the best of its knowledge threatened, against the City relating to the Project or to the Bond, the Loan Agreement or the Loan Agreement Assignment or questioning the organization of the City or its power or authority to issue the Bond or execute and deliver the Loan Agreement and the Loan Agreement Assignment. (f) The execution, delivery and performance of the City's obligations under the Bond, the Loan Agreement and the Loan Agreement Assignment have been fully authorized by all requisite action, including the adoption of this resolution, and do not and will not violate any 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 any indenture, agreement or other instrument to which the City is a party or by which it or any of its property is bound, or be in conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any such indenture, agreement or other instrument. AM 442 Resolution 82-114 - Continued November 16, 1982 (g) The Loan Agreement provides for payments by the Borrower to the Lender for the account of the City of such amounts as will be sufficient to pay the principal of, premium, if any, and interest on the Bond when due. No reserve funds are deemed necessary for this purpose. The Loan Agreement obligates the Borrower to provide for the operation and maintenance of the Project Facilities, including provision for adequate insurance, taxes and special assessments. (h) As required by the provisions of Section 474.10 of the Act, and the Bond shall recite that, the Bond is not to be payable from nor charged upon any funds other than amounts payable by the Borrower pursuant to the Loan Agreement, which are pledged to the payment thereof, and, in an event of default, moneys derived from foreclosure or other enforcement of the Mortgage, the Guaranty or the Guarantors' Mortgage; 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 the general funds or property of the City; the Bond shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City; and the Bond does not constitute an indebtedness of the City within the meaning of any constitutional or statutory limitation. (i) No member of the City Council (i) has a direct or indirect interest in the Project, the Loan Agreement, the Loan Agreement Assignment or the bond, (ii) owns any capital stock of or other interest in the Project or the Borrower, (iii) is an officer, employee or director of the Borrower, (iv) will be involved in supervising the completion of the Project, or (v) will receive any commission, bonus or other remuneration for or in respect of the Project, the Loan Agreement, the Loan Agreement Assignment or the Bond. 5. Approval and Execution of Documents. The forms of Loan Agreement, Loan Agreement Assignment, Mortgage, Guaranty and Guarantors' Mortgage referred to in paragraph 3 hereof are approved. The Loan Agreement and Loan Agreement Assignment shall be executed in the name and on behalf of the City by the Mayor 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 execution thereof. The Mortgage, the Guaranty and Guarantors' Mortgage may contain such revisions as may be approved by the Lender and the Borrower. 6. Approval of Terms and Sale of Bond. The City shall proceed forthwith to issue the Bond in authorized principal amount of $370,000, substantially in the form, maturing, bearing interest, payable in the installments and otherwise containing the provisions set forth in the form of Bond attached to the Loan Agreement as Exhibit B, which terms and provisions are hereby approved and incorporated in this Resolution and made a part hereof. A single fully registered bond, substantially in the form of Exhibit B to the Loan Agreement, shall be issued and delivered to the Lender in the authorized principal amount of $370,000 as authorized by the Act. Principal of and interest on the Bond shall be payable at the office of the registered owner thereof as it appears on the registration records maintained by the City Clerk in lawful money of the United States. The proposal of the Lender to purchase the Bond at a price of $370,000 (100% of the principal amount thereof) is hereby found and determined to be reasonable and is hereby accepted. Resolution 82-114 - Continued November 16, 1982 4 4 3 7. Execution, Delivery and Endorsement of Bond. The Bond may be in typewritten or printed form and shall be executed by the manual signatures of the Mayor and the City Manager, or other appropriate officers of the City authorized to execute instruments on their behalf, and the official seal of the City shall be affixed thereto. When so prepared and executed, the Bond shall be delivered to the Lender upon payment of the purchase price therefor, and upon receipt of the signed legal opinion of Faegre & Benson, of Minneapolis, Minnesota, bond counsel, pursuant to the Loan Agreement. The Bond shall contain a recital that the Bond is issued pursuant to the Act, and such recital shall be conclusive evidence of the validity and regularity of the issuance thereof. 8. Registration Records. The City Clerk, as bond registrar, shall keep a bond register in which the City shall provide for the registration of the Bond and for transfers of the Bonds. 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 County Auditor as to entry of the Bond on his bond register as required by the Act and Section 475.63, Minnesota Statutes. 9. Mutilated, Lost, Stolen or Destroyed Bond. If the Bond is mutilated, lost, stolen or destroyed, the City may execute and deliver to the Holder a new Bond of like amount, date, number and tenor as that mutilated, lost, stolen or destroyed; provided that, in the case of mutilation, the mutilated Bond shall first be surrendered to the City, and in the case of a lost, stolen or destroyed bond, there shall be first furnished to the City and the Borrower evidence of such loss, theft or destruction satisfactory to the City and the Borrower, together with indemnity satisfactory to them. The City and Borrwer may charge the Holder with their reasonable fees and expenses in replacing any mutilated, lost, stolen or destroyed Bond. 10. Transfer of Bond; Person Treated as Holder. The Bond shall be transferable by the Holder 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 City Clerk and the City Attorney duly executed by the Holder or its attorney duly authorized in writing. The Holder seeking to transfer ownership of the Bond shall also give written notice thereof to the Borrower. The Bond shall continue to be subject to successive transfers at the option of the Holder of the Bond. No service charge shall be made for any such transfer, but the City Clerk may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. The person in whose name the Bond shall be issued or, if transferred, shall be registered from time to time shall be deemed and regarded as the absolute Holder thereof for all purposes, and payment of or on account of the principal of and interest on such Bond shall be made only to or upon the order of the Holder thereof, or its attorney duly authorized in writing, and neither the City, the City Clerk, the Borrower, nor the Lender 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. The Bond shall be initially registered in the name of the Lender. 11. Amendments, Changes and Modifications to Loan Agreement and Bond Resolution. Except pursuant to Section 9.03 of the Loan Agreement, the City shall not enter into or make any change, modification, alteration or termination of the Loan Agreement, the Loan Agreement Assignment or this Bond Resolution. 444 A^ Resolution 82-114 - Continued November 16, 1982 12. Pledge to Holder. Pursuant to the Loan Agreement Assingment, the City shall pledge and assign to the Lender and its successor Holders of the Bond all interest of the City in the revenues of the Project and the Project Facilities, including all Loan Repayments to be made by the Borrower under the Loan Agreement. All collections of moneys by the City in any proceeding for enforcement of the obligations of the Borrower under the Loan Agreement, the Mortgage, the Guaranty or the Guarantors' Mortgage shall be received, held and applied by the City for the benefit of the Holder of the Bond. 13. Covenants with Holder; Enforceability. All provisions of the bond and of this Resolution and all representations and undertakings by the City in the Loan Agreement and the Loan Agreement Assignment are hereby declared to be covenants between the City and the Lender and its successor Holders of the Bond 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 pecuniary liability of the City, its employees, officers or agents or constitute a charge against its general credit or taxing powers. 14. Authorized Representative. 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 otherwise defined in this Resolution ut de ined in t e Loan Agreement shall have the same meanings in this Resolution and shall be 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 Resolution is for any reason illegal or invalid or inoperable, such illegality or invalidity or inoperability shall not affect the remaining provisions of this Resolution, which shall be construed or enforced as if such illegal or invalid or inoperable provision were not contained herein. 16. Certifications. The Mayor, City Manager, City Clerk 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 counsel for the Lender, certified copies of all proceedings and records of the City relating to the Project and the Bond, and such other affidavits and certificates as may be required to show the facts appearing from the books and records in the officer's 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. ary E. nderson, Mayor Pro Tem ATTEST: John Murphy, ,ty Clerk Resolution 82-114 - Continued November 16, 1982 445 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 and Stockman, and the following was absent: Thorsen, and the following voted against the same: none, whereupon said resolution was declared duly passed and adopted, signed by the Mayor Pro Tem and her signature attested by the City Clerk. 1 1