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83-060 - 06-07 Authorize Development Revenue BondsResolution 83-60 June 7, 1983 Member Anderson introduced the following resolution and moved its adoption: RESOLUTION AUTHORIZING A PROJECT UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT AND THE ISSUANCE OF INDUSTRIAL DEVELOPMENT REVENUE BONDS TO FINANCE THE PROJECT BE IT RESOLVED by the Council of the City of Golden Valley, Minnesota, as follows: 1. The Council has received a proposal from Hayes Enterprises, a Minnesota general partnership (the "Company") that the City undertake to finance a certain Project as herein described, pursuant to the Minnesota Municipal Industrial Development Act, Chapter 474, Minnesota Statutes (the "Act"), through issuance by the City of its $2,700,000 Industrial Development Revenue Bonds, Series 1983 (the "Bonds"), and in accordance with a Bond Purchase Agreement from Miller Securities, Inc. (the "Bond Purchaser") to the City. 2. Hayes Enterprises, a Minnesota general partnership (the "Company") desires to acquire certain real estate and renovate and equip the building currently located thereon for use by Hayes Contractors, Inc. as an office, manufacturing, warehouse facility (hereinafter referred to as the "Project"). The Project as described above will provide employment to approximately 100 additional persons and will otherwise further the policies and purposes of the Act and the findings made in the preliminary resolution adopted by this Council on Play 3, 1983 with respect to the Project are hereby ratified, affirmed and approved. 3. It is proposed that, pursuant to a Loan Agreement dated June 1, 1983, between the City as Lender and the Company as Borrower (the "Loan Agreement"), the City loan the proceeds of the Bonds to the Company to finance the cost of the Project. The basic payments to be made by the Company under the Loan Agreement are fixed so as to produce revenue sufficient to pay the principal of, premium, if any, and interest on the Bonds when due. It is further proposed that the City assign its rights to the basic payments and certain other rights under the Loan Agreement to the First National Bank of Minneapolis, in Minneapolis, Minnesota (the "Trustee") as security for payment of the Bonds under an Indenture of Trust dated June 1, 1983 (the "Indenture") and that the Company grant a mortgage and security interest in the Project to the Trustee pursuant to a Mortgage and Security Agreement dated June 1, 1983 (the "Mortgage") and enter into an Assignment of Leases and Rents dated June 1, 1983 (the "Assignment of Leases and Rents"). To further secure the payment of the Bonds and the interest thereon the partners of Hayes Enterprises and their spouses will execute a guaranty whereby they have jointly and severally guaranteed the payment of principal, premium, if any, and interest on the Bonds and the obligations of Hayes Enterprises under the Loan Agreement (the "Guaranty") and Hayes Contractors, Inc. will execute a lease of the Project at rentals in an amount which will at all times be equal to or greater than the monthly payment of principal and interest required to be made by Hayes Enterprises to the Trustee pursuant to Section 4.02(1)(a) of the Loan Agreement (the "Lease"). 4. This Council by action taken on May 3, 1983 gave preliminary approval to the proposal and an application has been submitted to the Commissioner of Energy, Planning and Development of the State of Minnesota requesting approval to the Project as tending to further the purposes and policies of the Act. Resolution 83-60 - Continued June 7, 1983 5. Pursuant to the preliminary approval of the Council, forms of the following documents have been submitted to the Council for approval: (a) The Loan Agreement. (b) The Indenture. (c) The Mortgage. (d) The Assignment of Leases and Rents. (e) The Guaranty. (f) The Lease. (g) The Preliminary Official Statement. (h) The Bond Purchase Agreement. 6. It is hereby found, determined and declared that: (a) the Project described in the Loan Agreement and Indenture referred to above constitutes a Project authorized by the Act; (b) the purpose of the Project is, and the effect thereof will be, to promote the public welfare by the acquisition and renovation of a facility for use as a manufacturing and warehouse facility. (c) the Project is to be located within the City limits, at a site which is easily accessible to employees residing within the City and the surrounding communities; (d) the acquisition and renovation of the Project, the issuance and sale of the Bonds, the execution and delivery by the City of the Bond Purchase Agreement, the Loan Agreement and the Indenture, and the performance of all covenants and agreements of the City contained in the Bond Purchase Agreement, the Loan Agreement and the Indenture and of all other acts and things required under the constitution and laws of the State of Minnesota to make the Bond Purchase Agreement, the Loan Agreement and Indenture and Bonds valid and binding obligations of the City in accordance with their terms, are authorized by the Act; (e) it is desirable that the Company be authorized, in accordance with the provisions of Section 474.03 of the Act, and subject to the terms and conditions set forth in the Loan Agreement, which terms and conditions the City determines to be necessary, desirable and proper, to complete the acquisition and renovation of the Project by such means as shall be available to the Company and in the manner determined by the Company, and with or without advertisement for bids as required for the acquisition and installation of municipal facilities; (f) it is desirable that the Bonds be issued by the City upon the terms set forth in the Indenture and at an interest rate not to exceed 13%; Resolution 83-60 - Continued June 7, 1983 (g) the basic payments under the Loan Agreement are fixed to produce revenue sufficient to provide for the prompt payment of principal of, premium, if any, and interest on the Bonds issued under the Indenture when due, and the Loan Agreement, Mortgage and Indenture also provide that the Company 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 Premises and payable during the term of the Mortgage, Loan Agreement and Indenture; (h) under the provisions of Minnesota Statutes, Section 474.10, and as provided in the Bond Purchase Agreement, the Loan Agreement and Indenture, the Bonds are not to be payable from or charged upon any funds other than the revenue pledged to the payment thereof; the City is not subject to any liability thereon; no holder of any Bonds shall ever have the right to compel any exercise by the City of its taxing powers to pay any of the Bonds or the interest or premium thereon, or to enforce payment thereof against any property of the City except the interests of the City in the Loan Agreement which have been assigned to the Trustee under the Indenture; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable upon any property of the City except the interests of the City in the Loan Agreement which have been assigned to the Trustee under the Indenture; the Bonds shall recite that the Bonds are issued without moral obligation on the part of the state or its political subdivisions, and that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment thereof; and, the Bonds shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation. 6. Subject to the approval of the City Attorney, the forms of the Bond Purchase Agreement, the Loan Agreement, the Lease, the Guaranty and Indenture and exhibits thereto and all other documents described in paragraph 4 hereof are approved substantially in the form submitted, except as otherwise provided in paragraph 7 hereof. The Bond Purchase Agreement, the Loan Agreement and Indenture, in substantially the form submitted, are directed to be executed in the name and on behalf of the City by the Mayor and the City Clerk. Any other documents and certificates necessary to the transaction described above shall be executed by the appropriate City officers. Copies of all of the documents necessary to the transaction herein described shall be delivered, filed and recorded as provided herein and in said Bond Purchase Agreement, Loan Agreement and Indenture. 7. The City shall proceed forthwith to issue its Bonds, in the form and upon the terms set forth in the Indenture. The offer of the Bond Purchaser to purchase the Bonds for $2,585,250 plus accrued interest to the date of delivery at an interest rate not to exceed 13% is hereby accepted. Subject to the conduct of a public hearing regarding this Project, as required by Section 103 of the Internal Revenue Code of 1954, as amended, and the ratification of the final interest rate, the Mayor and City Clerk are authorized and directed to prepare and execute the Bonds as prescribed in the Indenture and to deliver them to the Trustee for authentication and delivery to the Bond Purchaser. Resolution 83-60 - Continued June 7, 1983 8. The Mayor and City Clerk and other officers of the City are authorized and directed to prepare and furnish to the Bond Purchaser certified copies of all proceedings and records of the City relating to the bonds, and such other affidavits and certificates as may be required to show the facts relating to the legality of the Bonds as such facts appear 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. 9. The approval hereby given to the various documents referred to above includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, 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 Clerk, any of the documents authorized by this resolution to be executed may be executed by the Mayor Pro Tem or the City Clerk, respectively. Rosemary Thorsgn., M or ATTEST: n rlurpny, ,tiity'Cler The motion for the adoption of the foregoing resolution was seconded by Member Johnson and upon a vote being taken thereon, the following voted in favor thereof: Anderson, Johnson, Stockman and Thorsen, and the following was absent: Mitchell, 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.