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HomeMy WebLinkAbout1981-076 CCRMember Tony Kuefler introduced the following resolution and moved its adoption: RESOLUTION NO. 81 -76 RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF INDUSTRIAL REVENUE BONDS PURSUANT TO CHAPTER 474, MINNESOTA STATUTES, TO PROVIDE FUNDS TO BE LOANED TO FEDERAL LUMBER COMPANY FOR INDUSTRIAL DEVELOPMENT PROJECT AND APPROVING LOAN AGREEMENT, TRUST INDENTURE, STANDBY LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT, IRREVOCABLE LETTER OF CREDIT, COMBINATION MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT AND PRIVATE OFFERING MEMORANDUM BE IT RESOLVED by the City Council of the City of Brooklyn Center, 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 financing the cost of authorized projects and to enter into contracts necessary or convenient in the exercise of the powers granted by the Act. 2. Authorization of Project; Documents Presented. This Council proposes that the City shall issue and sell its City of Brooklyn Center Industrial Development Revenue Bonds (Federal Lumber Company Project), Series 1981, in substantially the form set forth in the hereinafter mentioned Trust Indenture (the "Bonds pursuant to the Act and loan the proceeds thereof to Federal Lumber Company, a Minnesota corporation (the "Company to finance the costs of the acquisition, construction and equipping of an office and warehouse building and other shed -type storage facilities in the City, together with any site improvements required in relation thereto, to be owned by the Company pursuant to the Act. Forms of the following documents relating to the Bond and the Project have been submitted to the City Council and are now on file in the office of the City Clerk: (a) Loan Agreement (the "Loan Agreement dated as of April, 1981, between the City and the Company whereby the City agrees to make a loan to the Company and the Company agrees to complete the Project and to pay amounts sufficient to provide for the full and prompt payment of the principal of, premium, if any, and interest on the Bonds; (b) Trust Indenture, (the "Trust Indenture dated as of April 1, 1981, between the City and National City Bank of Minneapolis, Minneapolis, Minnesota, as Trustee, pledging the revenues to be derived from the Loan Agreement as security for $1,000,000 City of Brooklyn Center Industrial Development Revenue Bonds (Federal Lumber Company Project), Series 1981 (the "Bonds to be issued by the City, and setting forth proposed recitals, covenants and agreements relating thereto; (c) Standby Letter of Credit and Reimbursement Agreement (the "Reimbursement Agreement dated as of April 1, 1981 between the Company and Northwestern National Bank of Minneapolis (the "Bank .RESOLUTION NO. 81 -76 whereby the Company agrees to reimburse the Bank the amount of each draft drawn under the hereinafter mentioned Irrevocable Letter of Credit (this document not to be executed by the City); and (d) Irrevocable Letter of Credit (the "Letter of Credit dated as of April 1, 1981 from the Bank to the Trustee providing for pay- ment by the Bank to the Trustee of the sum needed for payment of principal, premium, if any, and interest on the Bonds upon presenta- tion of a sight draft and certification by the Trustee (this document not to be executed by the City); and (e) Combination Mortgage, Security Agreement and Fixture Financing Statement (the "Mortgage dated as of April 1, 1981, between the Company, the Trustee and the Bank, by which the Company grants to the Trustee and the Bank a mortgage lien on and security interest in the Mortgaged Property, as defined therein, as security for the pay- ment of the Bonds and the Reimbursement Agreement (this document not to be executed by the City); and (f) Private Offering Memorandum dated March 27, 1981, describing the offer of the Bonds, certain terms and provisions of the fore- going documents, and certain information concerning the Bank and the Company as deemed material by the Bank and the Company. 3. Findings. It is hereby found, determined and declared that: (a) The Project, as described in paragraph 2 above and in the Loan Agreement, constitutes a project authorized by and described in 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: 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 community, in order to retain the benefit of the community's existing investment in educational and public service facilities; 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 increasing the tax base of the City and the county and school district in which the Project is located. (c) 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. (d) The issuance and sale of the Bonds, the execution and delivery of the Loan Agreement and Trust Indenture and the performance of all covenants and agreements of the City contained in the Bonds, the Loan Agreement and Trust Indenture, and of all other acts and things required under the Constitution and laws of the State of Minnesota to make the Loan Agreement and Trust Indenture and the Bonds valid and binding obligations of the City in accordance with their terms, are authorized by the Act. RESOLUTION NO. 81 -76 (e) There is no litigation pending or, to the best of its knowledge, threatened against the City relating to the Project or to the Bonds, Loan Agreement or Trust Indenture or questioning the organization, powers or authority of the City. (f) The execution, delivery and performance of the City's obligations under the Bonds, the Trust Indenture and the Loan Agreement have been fully authorized by all requisite action and do not and will not violate any law, any charter provision, any order of any court or other agency of government, 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. (g) It is desirable that the City of Brooklyn Center Industrial Development Revenue Bonds (Federal Lumber Company Project), Series 1981, in the amount of $1,000,000 be issued by the City upon the terms set forth in the Trust Indenture, under the provisions of which the City's interest in the Loan Agreement will be pledged to the Trustee as security for the payment of principal of, premium, if any, and interest on the Bonds. (h) The Loan Agreement provides for payments by the Company to the Trustee for the account of the City of such amounts as will be sufficient to pay the prinicipal of, premium, if any, and interest on the Bonds when due. The Loan Agreement obligates the Company to provide for the payment of operation and maintenance expenses, including adequate insurance, taxes and special assessments. (i) Under the provisions of Section 474.10, Minnesota Statutes, and as provided in the Loan Agreement and Trust Indenture, the Bonds are not to be payable from nor charged upon any funds other than amounts payable by the Company pursuant to the Loan Agreement, the Letter of Credit and moneys in the funds and accounts held by the Trustee which are pledged to the payment thereof; the City is not subject to any liability thereon; no holders of the Bonds shall ever have the right to compel the exercise of the taxing power 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; and each Bond issued under the Trust Indenture shall recite that the Bond, including interest thereon, shall not constitute nor give rise to a charge against the general credit or taxing powers of the City and that the Bond does not constitute an indebtedness of the City within the meaning of any constitutional, charter or statutory limitation. (j) No member of the City Council (i) has a direct or indirect interest in the Project, the Loan Agreement, the Trust Indenture or Bonds, (ii) owns any capital stock of or other interest in the Project or the Company, (iii) is an officer or director of the Company, (iv) will be involved in supervising the completion of the Project on behalf of the Company, or (v) will receive any commission, bonus or other RESOLUTION NO. 81 -76 remuneration for or in respect of the Project, the Loan Agreement, the Bonds or the Trust Indenture. 4. Approval and Execution of Documents. The forms of Loan Agreement, Trust Indenture, Reimbursement Agreement, Letter of Credit, Mortgage and Private Offering Memoranda referred to in paragraph 2 are approved. The Loan Agreement and Trust Indenture shall be executed in the name and on behalf of the City by the Mayor and the City Manager upon execution thereof by the officers of the Company, 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 and then shall be delivered to the Trustee. Copies of all documents shall be delivered and filed as provided therein. S. Approval, Execution and Delivery of Bond. The City shall proceed forthwith to issue its City of Brooklyn Center Industrial Development Revenue Bonds (Federal Lumber Company Project), Series 1981, dated as of April 1, 1981, in the principal amount of $1,000,000 in the form and upon the terms set forth in the Trust Indenture, which terms are for this purpose incorporated in this resolution and made a part hereof. The Bank, acting as placement agent, has advised the City that purchasers of the Bonds have agreed to purchase the Bonds at a purchase price of $1,000,000 plus accrued interest to the date of delivery and said purchase price is hereby found to be favorable and is hereby accepted. The Mayor and City Manager are authorized and directed to prepare and execute the Bonds as prescribed in the Trust Indenture and to deliver them to the Trustee, together with a certified copy of this Resolution and the other documents required by Section 2.09 of the Trust Indenture, for authentication and delivery to the purchasers. As provided in the Trust Indenture, each Bond shall contain a recital that it is issued pursuant to the Act, and such recital shall be conclusive evidence of the validity and regularity of the issuance thereof. 6. Private Offering Memorandum. The City hereby consents to the use of the Private Offering Memorandum, provided that the Private Offering Memoran- dum shall always recite that the Appendices to the Private Offering Memorandum has been prepared by the Company and the Bank and that the City has made no independent investigation with respect to the information contained in the Appendices thereto. 7. Certificates, etc. The Mayor, City Manager, City Clerk and other officers of the City are authorized and directed to prepare and furnish to the purchaser of the Bonds, when issued, 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 appearing 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. 8. Authorization. The City Clerk is authorized and directed to deliver a certified copy of this Bond Resolution to the Hennepin County Finance Director acting as County Auditor, together with such other information as the County Auditor may require, and obtain the certificate of the County Auditor as to entry of the Bonds on his bond register as required by the Act and Section 475.63, Minnesota Statutes. RESOLUTION NO. 81 -76 April 6, 1981 Date ATTEST: Clerk The motion for the adoption of the foregoing resolution was duly seconded by member Celia Scott and upon vote being taken thereon, the following voted in favor thereof: Dean Nyquist, Tony Kuefler, Gene Lhotka, and Celia Scott;- and the following voted against the same: none, whereupon said resolution was declared duly passed and adopted. 1 n