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HomeMy WebLinkAbout6709 (Res.)• 12i • • r RESOLUTION NO. 6709 RESOLUTION RELATING 10 $610,000 COMMERCIAL DEVELOPMENT REVENUE NOTE; A0THORIZING THE ISSUANCE THEREOF PURSUANT TO MIPIINE.SOTA STATUIES,CNAPTER 474. BE IT RESOLVED by the City C tmcil of the City of Stillwater, Minnesota as follows: Section 1. Introduction. There is presently on file with the City Clerk proposed forms of a $610,000 Camercial Development Revenue Note (the Note) to be issued by the City of Stillwater, Minnesota (the City) to The First National Bank of Saint Paul, a national banking association in St. Paul, Minnesota (the Construction Lender), a Building Loan Agreement (the Building Loan Agreement) to be entered into among the City, Consoldiated limber Company, a Minnesota corporation (the Borrower), and the Construction Lender, a loan Agreement (the Loan Agreement) to be entered into among the City and the Borrower, and a Pledge Agreement (the Pledge Agre anent) to be entered into between the City and the Construction Lender, all relating to a Project (the Project) to which this Council has given preliminary approval by Resolution No. 6625, adopted April 10, 1979. Unless the context hereof clearly requires otherwise, the terms defined in Section 1 of the Loan Agreement shall, when used with initial capital letters herein, have the meanings ascribed to them in the loan Agreement, Without limiting the generality of the foregoing, the terminology used herein nay include the following terms as defined in the loan Agreement; Act; Assignment of Rents; Borroer; Building loan Agreement; Building Loan Commitment; Buy and Sell Agreement; City; Code; Collateral Damn ants; Construction Costs; Construction Lender; Counsel; Date of Taxability; Default; Determination of Taxability; Equipment; Event of Default; Fixtures; Holder; Improvements; Land; Loan Agreement; Loan and Carrying Charges; Mortgage; Mortgagee; Note; Organizational Documents; Permanent Lender; Permanent Loan Commitment; Permitted Encumbrances; Person; Plans and Specifications; Pledge Agreement; Project; Project Costs; and Resolution. Section 2. Findings. It is hereby found and declared that: (a) The Project 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 the attraction, encouragement and development of economically sound industry and commerce so as to prevent the emergence of or to rehabilitate, so far as possible, blighted and marginal lands and areas of chronic unemployment; the retention of industry to use the available resources of the community in order to retain the benefit of its existing investment in educational and public service facilities; halting the movement of talented, educated per- sonnel of mature age to other areas and thus preserving the economic and human resources needed as a base for providino governmental services and facilities; more intesive develop- ment of land available in the community to provide an adequate and better balanced tax base to finance the increase in the amount and cost of governmental services. (c) The Project when completed will add to the tax base of the City, and will accord- ingly be of direct benefit to the taxpayers of the City as well as those of the Canty and School District in which the Project is located. (d) The Project has been approved by the Commissioner of Securities of the State of Minnesota as tending to further the purposes and policies of the Act. (e) The financing of the Project, the issuance and sale of the Note, the execution and delivery of the Building loan Agreement, the Loan Agreement and the Pledge Agr'eeent and the performance of all covenants and agreements of the City contained in the Building loan Agreement, the Loan Agreement and the Pledge Agreement and of all other acts and things required under the Constitution and laws of the State of Minnesota to make the Note, the Building Loan Agreement, the Loan Agreement and the Pledge Agreement valid and binding obligations of the City enforceable in accordance with their terns, are authorized by the Act. (f) It is desirable that the Note in the maximum principal amount of $610,000 be issued by the City upon the terns set forth herein, and that :he City assign its interest in the loan Agreement and grant a security interest therein to the Construction lender as security for the payment of the principal of and interest and premium, if any, on the Note. (g) The loan payments required by the loan Agreement are fixed and 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 the Note issued under this Resolution when due, and the Loan Agreement also provides that the Borrower is required to pay all expenses of the operation and maintenance of the Project including, but without limitation, adequate insurance thereon and all •axes and special assessments levied upon or with respect to the Land payable during the term of the loan Agreement. (h) Under the provisions of Minnesota Statutes, Section 474.10, and as to be provided in the Note, the Note is not to be payable from nor charged upon any funds of the City other than any liability under the no Holdererof t thee Noteto the shall e's hhaveet htheright of; the �mmpel any exety is not rciseect (continued (continued on page 122) a • • • 422 • • RESCLUPICN N0. 6709 - continued of the taxing power of the City to pay the Note or the interest thereon, nor to enforce payment thereof against any property of the City except the Project, or portions thereof, mortgaged or otherwise encumbered by the Mortgage; the Note issued hereunder shall recite that the Note, including interest thereon, is payable solely frame the revenue under the Ivan Agreement pledged to the payment thereof; and the Note shall not constitute a debt of the City within the meaning of any constitutional, statutory or charter limitation; provided, however, that nothing con- tained in this paragraph (h) shall impair the rights of the Holder or Holders of the Note to enforce convenants made for the security thereof as provided in Minnesota Statutes 474.11. Section 3. Authorization and Sale. 3.1 Authorization. The City is authorized by the Act to issue revenue bonds and loan the proceeds thereof to business enterprises to finance the acquisition and construction of "projects" as defined in the Act, and to make all contracts, execute all instruments and do all things necessary or convenient in the exercise of such authority. 3.2 Preliminary City Approval. By preliminary resolution duly adopted by the Council on April 10, 1979, this Council approved the sale of industrial development revenue bonds pursuant to the Act and the loan of proceeds to the Borrower for the construction of the Project and authorized the preparation of such documents as may be appropriate to the Project. The Note constitutes an indus- trial development revenue bond in contemplation of the Act and said preliminary resolution. 3.3 Approval of Documents. Pursuant to the above, there have been prepared and presented to this Council copies of the following documents, all of which are now, or shall be, placed on file in the office of the City Clerk: (a) the Building Loan Agreement; (b) the loan Agreement; (c) the Pledge Agreement; (d) the Mortgage; and (e) the Assignment of Rents. The fors of the documents listed in (a) through (e) above are approved, with such variations, insertions and additions as are deemed appropriate by the parties and approved by the City Attorney and bond counsel. lids Council does hereby authorize and consent to the preparation, execution and delivery of all other Collateral Documents or other closing doormats or instruments contem- plated by the Collateral Documents or required by bond counsel for the Construction Lender or the Permanent Lender. Section 4. Authorizations. Upon the completion of the Building Loan Agreement, the Lean Agreement and the Pledge Agreement, and exccurion thereof by the Borrower, the Construction Lender and the Permanent Lanier, as the case may be, the Mayor and the City Clerk shall execute the same on behalf of the City and shall execute the Note in substantially the form as set forth in Exhibit A attached hereto on behalf of the City, and shall execute such other certifications, documents or instruments as bond counsel or counsel for the Construction Lender or the Permanent Lender shall require, subject to the approval of the City Attorney, and all certifications, recitals and representations therein shall constitute the certificates, recitals and representations of the City. Execution of any instrment or dormant by one or more appropriate officers of the City shall constitute, and shall be deemed the conclusive evidence of, the approval and authorization by the City and the Council of the instrument or dor:mart so executed. In the absence or disability of the Mayor, any of the documents authorized by this reolution to be executed, shall be executed by the acting Mayor, and in the absence of the City Clerk, by such officer of the City who, in the opinion of the City Attorney, may execute such documents. Section 5. The Note. 5.1 Form and Authorized [mount of Note. The Note shall be issued substantially in the form set forth in Exhibit A attached hereto and made a part hereof, with such appropriate variations, omissions and insertions as are permitted or require by this resolution, in the maxinn principal aunt of up to $610, 000, or so nuch as may be advanced thereunder in accordance with the Building Loan [grunt. The terms of the Note are set forth in Exhibit A attached hereto, and such tents, including but not limited to interest rate, dates and amount of payment of principal and interest and prepayment privileges, are incorporated by reference herein. 5.2 Execution. The Note shall he executed on behalf of the City by the signatures of the Mayor and the Ciiy, and shall be sealed with its corporate seal. In case any officer whose signature shall appear on the Note shall cease to be such officer before the delivery thereof, such signatures shall nevertheless be valid and sufficient for all purposes. (continued on page 123) • • • • • 123 • • RESOLUFICN NO. 6709 - continued 5.3. Mutilated, Lost and Destroyed Note. In case the Note shall became mutilated or be desUlld or lost, the City shall cause to be executed and delivered a new Note of like outstanding principal amount and tenor in exchange and substitution for and upon cancellation of the mutilated Note, or in lieu of and in substitution for such Note destroyed or lost, upon the Holder's paying the reasonable expenses and charges of the City in connection there- with, and in case the Note is destroyed or lost, its filing with the City evidence satisfactory to it of such destruction or loss. 5.4 Assigfinent. The Note may be assigned by the Holder thereof, from time to time, by endorsement thereon or by separate written instruct, provided that notice of any such assign- ment shall be given in writing to the City and the Borrower. At the rest of the Holder, the Note shall be registered on the nooks of the City, subject to the conditions set forth in the form of the Note, Exhibit A attached hereto. 5.51 Delivery and Use of Proceeds. Prior to delivery of the Note, the documents referred to in paragraphs (a) through (e) of Section 3.3 hereof shall be canpleted and executed in form and substance as approved by the City Attorney. The City shall execute and deliver the Note to the Construction Lender, together with a duly certified copy of this Resolution, original, executed counterparts of the Building loan Agreement, the Loan Agreement and the Pledge Agreement, and such closing certificates, opinions and related documents as are required by bond counsel. Upon c'eliverh of the No-e and the above items to the Construction lender, the Con- struction Lender shall, on behalf of the City, disburse to the Borrower the proceeds of the Note in accordance with the Building Loan Agreement, and the proceeds so disbursed shall be deed to have been disbursed for the benefit of the City. The Construction Lender or the Borrower shall provide the City with a full accounting of all funds so disbursed. Section 6. Limitation of the Ciyy' s Obligations. Notwithstanding anything contained in the Note, the Building loan Agreement, the loan Agreement, the Pledge Agreement, or any other documents referred to in Section 3.3, the Note shall not be payable from nor charged upon any funds of the City other than the revenue under the loan Agreement pledged to the payment thereof, nor shall the City be subject to any liability thereon. No Holder or Holders of the Note shall ever have the right to compel any exercise of the taxing pacer of the City to pay the Note or the interest thereon, nor to enforce pa-ment thereof against any property of the City except the Project, or portions thereof, mortgaged or otherwise encumbered by the Mortgage. The Note shall not constitute a charge, lien, or enambrare, legal or equitable, upon any property of the City, except the Project, or portions thereof, mortgaged or otherwise ecuthered by the Ibrtgage. The Note, including interest thereon, is payable solely from the revenue under the Loan Agreement pledged to the payment thereon. The Note shall not constitute a debt of the City within the meaning of any constitutiaal, statutory or charter limitation. However, nothing contained in this Section 6 shall impair the rights of the Holder or Holders of the Note to enforce covenants made for the security thereof as provided under the provisions of Minnesota Statutes, Section 474.11. Adopted by the Coital this 23rd day of October, 1979. Published: October 29, 1979 Attest:, A.--'t,,.r-C< - City CLetk Mayor • • •