#82-116 12-07-82 Issue Revenue Bonds Loan AgreementResolution 82-116
December 7, 1982 4 A 7
Member Stockman introduced 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 installation 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. H B Associates Limited Partnership, a
Minnesota limited partnership the Partnership), has proposed that the City
acting under and pursuant to the Act, issue its $1,350,000 Industrial
Development Revenue Bonds (H B Associates Limited Partnership Project), Series
1982 (the Bonds) for the purpose of defraying the costs of the acquisition and
construction of a project consisting of a building, related improvements and
equipment and other items of personal property constructed or installed thereon
suitable for use as a commercial office building (the Project) within the City.
Pursuant to the proposal the City will loan the proceeds of the Bonds to the
Partnership and the Partnership 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 Dougherty, Dawkins, Strand & Yost,
Incorporated, of Minneapolis, Minnesota (the Underwriter) pursuant to a Bond
Purchase Agreement (as hereinafter defined).
1.03. Prior Approval. On July 21, 1981 and July 6, 1982, this Council
adopted resolutions giving preliminary approval to the Project and authorizing
preparation of necessary documents (the Resolutions).
1.04. Project Cost. The Partnership has advised this Council and this
Council hereby finds that the estimated cost of the Project at the present time
exceed $1,350,000. Pursuant to the Loan Agreement, all costs of the Project in
excess of the proceeds of the Bonds available therefor are required to be paid
by the Partnership.
1.05. Documentation. Forms of the following documents relating to the
Project have-een prepared and submitted to this Council and are hereby directed
to be filed with the City Clerk.
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Resolution 82-116 - Continued
December 7, 1982
(a) a Loan Agreement (the Loan
Agreement), to be
dated as
of December 1,
1982, proposed to be made and entered
into between the
City and
the Partnership
pursuant to which the City loans the
proceeds of the Bonds
to the
Partnership;
(b) an Indenture of Trust (the
Indenture), to be
dated as
of December 1,
Northwestern
1982, proposed to be made and entered
into between the
City and
the
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 Combination Mortgage and Security Agreement and Fixture Financing
Statement (the Mortgage), to be dated as of December 1, 1982, proposed to be
made and entered into between the Partnership and the Trustee, whereby the
Partnership will mortgage the real property included in the Project to the
Trustee to secure the Bonds and the Partnership's obligations under the Loan
Agreement;
(d) an Assignment of Rents and Leases (the Assignment), to be dated as of
December 1, 1982, proposed to be made and entered into between the Partnership
and the Trustee, whereby the Partnership will assign rents and leases with
respect to the Project to the Trustee to additionally secure the Bonds and the
Partnership's obligations under the Loan Agreement;
(e) a Guaranty Agreement (the Guaranty), to be dated as of December 1,
1982, proposed to be made and entered into between Northwestern National Life
Insurance Company, a Minnesota corporation (the Guarantor) and the Trustee;
(f) Preliminary Official Statement (the Preliminary Official Statement),
dated November 29, 1982, pursuant to which information relating to the City, the
Partnership, the Guarantor, the Project and the Series 1982 Bonds hereinafter
described will be given to prospective purchasers of the Series 1982 Bonds; and
(g) a Bond Purchase Agreement (the Bond Purchase Agreement), dated
December 7, 1982, proposed to be made and entered into betweeen the City, the
Partnership and the Underwriter, pursuant to which the Underwriter 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 Partnership, 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 service;
Resolution 82-116 - Continued
December 7, 1982 A 4 p
(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 $1,350,000, the execution and delivery of the Loan
Agreement, the Indenture, the Disbursing Agreement and the Bond Purchase
Agreement, and the performance of all covenants and agreements of the City
contained in the Loan Agreement, the Indenture, the Disbursing Agreement 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 Disbursing Agreement and the Bond Purchase Agreement and the
Series 1982 Bonds valid and binding obligations in accordance with their terms,
are authorized by the Act;
(g) it is desirable that the Series 1982 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 Partnership is required to pay all expenses of the operation
and maintenance of the Project, including, but without limitation, 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; and
(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 or 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.
IJ
454
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Resolution 82-116 - Continued
December 7, 1982 451 C1
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 udes 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.
a
Rosemary Thorse Mayor
,, ..
ATTEST:
John Murphy, Cit rk
The motion for the adotion of the foregoing resolution was seconded by Member
Anderson, and upon a vote being taken thereon, the following voted in favor
thereof: Anderson, Mitchell, Stockman and Thorsen, and the following was
absent: Johnson, and the following voted against the same: none, whereupon
said resolution was delcared duly passed and adopted, signed by the Mayor and
her signature attested by the City Clerk.
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