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HomeMy WebLinkAbout1980-286 CCRMember Tony Kuefler introduced the following resolution and moved its adoption: RESOLUTION NO. 80 -286 RESOLUTION GRANTING FINAL APPROVAL TO INDUSTRIAL DEVELOPMENT REVENUE BOND PROPOSAL FROM SWENSON'S CARRIAGE HOUSE BE IT RESOLVED by the City Council of the City of Brooklyn Center, Minnesota, as follows: ARTICLE ONE DEFINITIONS, LEGAL AUTHORIZATION AND FINDINGS 1 -1. Definitions. �J f' The terms used herein, unless the context hereof shall require otherwise shall have the following meanings, and any other terms defined in the Loan Agreement shall have the same meanings when used herein as assigned to them in the Loan Agreement unless the context or use thereof indicates another or different meaning or intent. Act: the Minnesota Municipal Industrial Development Act, Minnesota Statutes, Chapter 474, as amended; Assignment of Leases and Rents: the agreement to be executed by the Borrower assigning all the rents, issues and profits derived from the Project to the Lender to secure the repayment of the Note; Bond Counsel: the firm of Briggs and Morgan, Professional Association, of St. Paul and Minneapolis, Minnesota, and any opinion of Bond Counsel shall be a written opinion signed by such Counsel; Borrower: S S Real Estate, a Minnesota general partnership consisting of Dale Swenson and Duane M. Swenson., its successors, assigns, and any surviving, resulting or transferee business entity which may assume its obligations under the Loan Agreement; City: the City of Brooklyn Center, Minnesota, its successors and assigns; Construction Loan Agreement: the agreement to be executed by the City, the Borrower and the Lender, relating to the disburse- ment and payment of Project Costs for the acquisition of the Land and the construction and installation of the Improvements; RESOLUTION NO. 80 -286 Guaranty: the guaranty to be executed by Dale Swenson and Duane M. Swenson in favor of the Lender, guarantying payment of, among other things, the Note; Improvements: the structures and other improvements, to be constructed or installed by the Borrower on the Land in accordance with the Plans and Specifications; 1 Land: the real property and any other easements and rights described in Exhibit A attached to the Loan Agreement; Lender: American National Bank and Trust Company, Saint Paul, Minnesota, its successors and assigns; Loan Agreement: the agreement to be executed by the City and the Borrower, providing for the issuance of the Note and the loan of the proceeds thereof to the Borrower, including any amendments or supplements thereto made in accordance with its provisions; Mortgage: the Mortgage, Security Agreement and Fixture Financing Statement to be executed by the Borrower, as mortgagor, to the Lender, as mortgagee, securing payment of the Note; Municipality Financing Statement: statement to be executed by the City in Pledge Agreement; Note: the $600,000 Commercial Dev Revenue Note of 1980 (S S Real Estate by the City pursuant to this Resolution the UCC -1 financing connection with the -alopment Construction Project), to be issued and the Loan Agreement; 1 Note Register: the records kept by the City Clerk to provide for the registration of transfer of ownership of the Note; Plans and Specifications: the plans and specifications for the construction and installation of the Improvements on the Land, which are approved'by the Lender, together with such modifications thereof and additions thereto as are reasonably determined by the Borrower.to be necessary or desirable for the completion of the Improvements and are approved by the Lender; Pledge Agreement: the agreement City in favor of the Lender assigning rights under the Loan Agreement to the repayment of the Note; to be executed by the certain of the City's Lender to secure 2 RESOLUTION NO. 80 -286 Principal Balance: so much of the principal sum on the Note as from time to time may have been advanced to or for the benefit of the City and remains unpaid at any time; Project: the Land and Improvements as they may at any time exist; Project Costs: the total of all "Construction Costs" and "Loan and Carrying Charges," as those terms are defined in the Loan Agreement; Resolution: this Resolution of the City adopted December 22, 1980, together with any supplement or amendment thereto. All references in this instrument to designated "Articles," "Sections" and other subdivisions are to the designated Articles, Sections and subdivisions of this instrument as originally executed. The words "herein," "hereof" and "hereunder" and other words of similar import refer to this Resolution as a whole not to any particular Article, Section or subdivision. 1 -2. Leqal Authorization. The City is a political Minnesota and is authorized under to initiate the revenue producing and to issue and sell the Note fo and upon the terms and conditions this Resolution. `1 -3. Findinqs. subdivision of the State of the Act and the City Charter project herein referred to, r the purpose, in the manner set forth in the Act and in The City Council has heretofore determined, and does hereby determine, as follows: (1} 'The City is authorized by the Act and the City Charter to enter into a Loan Agreement for the public purposes expressed in the Act; (2) The City has made the necessary arrangements with the Borrower for the establishment within the City of a Project consisting of certain property all as more fully described in the Loan Aqreement and which will be of the character and accomplish the purposes provided by the Act, and the City has by this Resolution authorized the Project and execution of the Loan Aqreement, the Pledge Aqreement, the Municipality Financinq Statenent, the Note and the Construction Loan Agreement, which documents specify the.terms and conditions of the acquisition and financing of the Project; 3 RESOLUTION NO. 80 -286 (3) in authorizing the Project the City's purpose is, and in its judgment 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, so far as possible, the emergence of blighted and marqinal lands and areas of chronic unemployment; the develop ment of revenue- producing enterprises 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; the halting of the movement of talented, educated personnel of all ages to other areas thus preserving the economic and human resources needed as a base for providing governmental services and facilities; the provision of acces- sible employment opportunities for residents in the area; the expansion of an adequate tax base to finance the increase in the amount and cost of governmental services, including educational services for the school district serving the community in which the Project is situated; (4) the amount estimated to be necessary to partially finance the Project Costs, including the costs and estimated costs permitted by Section 474.05 of the Act, will require the issuance of the Note in the principal amount of $600,000.00 as hereinafter provided; (5) it is desirable, feasible and consistent with the objects and purposes of the Act to issue the Note, for the purpose of partially financing the Project; (6) the Note and the interest accruing thereon do not constitute an indebtedness of the City within the meaning of any constitutional or statutory limitation and do not constitute or give rise to a pecuniary liability or a charge against the general credit or taxing powers of the City and neither the full faith and credit nor the taxing powers of the City is pledged for the payment of the Note or interest thereon; and (7) The Note is an industrial development bond within the Meaning of Section 103(b) of the Internal Revenue Code and is to be issued within the exemption provided under subparagraph (A) of Section 103(b)(6) of the Code with respect to an issue of $1,000,000 or less; provided that nothing herein shall prevent the City from hereafter qualifying the Note under a different exemption if, and to the extent, such exemption is permitted by law and consistent with the objects and purposes of the Project. 4 RESOLUTION NO. 80 -286 1 -4. Authorization and Ratification of Project. The City has heretofore and does hereby authorize the Borrower, in accordance with the provisions of Section 474.03(7) of the Act and the City Charter and subject to the terms and conditions set forth in the Construction Loan Agreement, to provide for the construction and installation of the Project pursuant to the Plans and Specifications by such means as shall be available to the Borrower and in the manner determined by the Borrower, and without advertisement for bids as may be required for the construction and acquisition of municipal facilities; and the City hereby ratifies, affirms, and approves all actions heretofore taken by the Borrower consistent with and in anticipation of such authority and in compliance with the Plans and Specifications. 1 -5. Authorization of Permanent Tax Exempt Financing. (1) The City hereby determined that the financing_ for the Project is intended to consist of (a) the Note and the $150,000 Commercial Develonment Construction Revenue Note of 1980 (S S Real Estate Project) to be issued by the City to provide interim construction financing, (b) a conventional stand -bv loan, if necessary, and (c) a tax exempt permanent loan to take out either the Note, or, if made, the stand -bv loan; that in order to induce the Lender to provide the construction loan and to purchase the Note, a stand -by take -out commitment has been secured by the Borrower under the terms of which the stand -by lender will, if a permanent tax exempt loan cannot later be secured, loan the Borrower on a conventional basis funds necessary to pay the principal and accrued interest on the construction loan evidenced by the Note; that such stand -by loan will be secured by a new mortgage and will be evidenced by a conventional note from the Borrower to the stand -by lender; that the City will not be a party to the stand -by loan; that the stand -by loan itself will be in the nature of an interim loan since according to the terms of the stand -by commitment the conventional note must be paid off within three years; and that the Borrower is presently seeking a permanent tax exempt loan commitment to replace the stand -by loan commitment. (2) In order to induce the Borrower to undertake the Project and the Lender to purchase the Note and pursuant to Section 474.07 and other relevant portions of the Act, the City hereby authorizes permanent tax exempt financing and covenants to exercise its best efforts to provide such financing for the 5 RESOLUTION NO. 80 -286 Project in an amount not to exceed $1,000,000 for the purpose of (a) reimbursing the Borrower for Project Costs not financed from the proceeds of the Note and (b) taking out the Note or the stand -bv loan, if made, in the form of industrial development revenue bonds or a mortgage revenue note or notes. (3) This approval and authorization is subject to such conditions as the City customarily requires for.such financing and subject to agreement as to details by the City, °the Borrower and the Permanent Lender or Underwriter. F� R RESOLUTION NO. 80 -286 ARTICLE TWO NOTE 2 -1. Authorized Amount and Form of Note. The Note issued pursuant to this Resolution shall'be_ in substantially the form attached hereto as Exhibit A,-with such appropriate variations, omissions and insertions as are permitted or required by this Resolution, and in accordance with the further provisions hereof; and the total principal amount of the Note that may be outstanding hereunder is expressly limited to $600,000 unless a duplicate Note is issued pursuant to Section 2 -6. 2 -2. The Note. The Note shall be dated,as of the date of delivery, shall be payable at the times and in the manner, shall bear interest at the rate, and shall be subject to such other terms_ and conditions as are set forth therein. 2 -3. Execution. The Note shall be executed on behalf of the City by the signatures of its Mayor and Manaqer and shall be sealed with the seal of the City. In case any officer whose signature shall appear on the Note shall cease.to be such officer before the delivery of the Note, such signature shall nevertheless be valid and sufficient for all purposes, the same as if such officers had remained in office until delivery. 2 -4. Delivery of Note. Before delivery of the Note there shall be filed with the Lender (except to the extent waived by the Lender) the following items: (1) an executed copy of each of the following documents: (A) the Loan Agreement; (B) the Pledge Agreement; (C) the Mortgage; (D) the Assignment of Leases and Rents; (E) the Construction Loan Agreement; (F) the Guaranty; (G) the Municipality Fina.ncinq Statement. 7 RESOLUTION NO. 80 -286 (2) an opinion of Counsel for the Borrower in scope and substance satisfactory to Bond Counsel and the Lender as to the authority of the Borrower to enter into the transaction and other related Matters; (3) the opinion of Bond Counsel as to the validity and tax exempt status of the Note; (4) a Mortgagee's title insurance policy, or at the option of the Lender a commitment for such policy, issued by Title Insurance Company of Minnesota in the amount of $600,000 insuring the Mortgage as a first and prior lien on the Land subject only to such exceptions as are acceptable to the Lender; (5) such other documents and opinions as Bond Counsel may reasonably require for purposes of rendering its opinion required in subsection (3) above or that the Lender may require for the closing. Upon delivery of the Note, the Lender is authorized to advance funds on behalf of the City for payment of Project Costs upon receipt of such supporting documentation as the Lender may deem reasonably necessary, including compliance with such provisions of the Construction Loan Agreement as the Lender may deem necessary. The Lender or the Borrower shall provide the City with a full accounting of all funds disbursed for Project Costs. 2 -5. Registration of Transfer. The City will cause to be kept at the office of the City Clerk a Note Register in which, subject to such reasonable regulations as it may prescribe, the City shall provide for the registration of transfers of ownership of the Note. The Note shall be transferable upon the Note Register by the Lender in person or by its agent duly authorized in writing, upon surrender of the Note together with a written instrument of transfer satisfactory to the City Attorney, duly executed by the Lender or its dulv authorized aqent. Upon such transfer the City Clerk shall note the date of registration and the name and address of the new Lender in the Note Register and in the. registration blank appearing on the Note. 2 -6. Mutilated, Lost or Destroyed Note. In case any Note issued hereunder shall become mutilated or be destroyed or lost, the City shall, if not then 0 RESOLUTION NO. 80 -286 prohibited by law, cause to be executed and delivered, a new Note of original principal amount, number and tenor in exchange and substitution for and upon cancellation of such mutilated Note, or in lieu of and in substitution for such Note destroyed or lost, upon the Lender's paying the reasonable expenses and charges of the City in' connection therewith, and in the case of a Note destroyed or lost, the filing with the City of evidence satisfactory to the City that such Note was destroyed or lost, and furnishing the City with indemnity satisfactory to it. If the mutilated, destroyed or lost Note has already matured or been called for redemption in accordance with its terms it shall not be necessary to issue a new Note prior to payment. 2 -7. Ownership of Note. The City may deem and treat the person in whose name the Note is last registered in the Note Register and by notation on the Note whether or not such Note shall be overdue, as the absolute owner of such Note for the purpose of receiving payment of or on account of the Principal Balance, redemption price or interest and for all other purposes whatsoever, and the City shall not be affected by any notice to the contrary. 2 -8. Limitation on Note Transfers. The Note has been issued without registration under state or other securities laws, pursuant to an exemption for such issuance; and accordingly the Note may not`be assigned or transferred in whole or part, nor may a interest in the Note be given pursuant to any participation agreement, except in accordance with an applicable exemption from such registration requirements. II L_ J E RESOLUTION NO. 80 -286 ARTICLE THREE GENERAL COVENANTS 3 -1. Pavment of Principal and Interest. The City covenants that it will promptly pay or cause to be paid the principal of and interest on the Note at the place, on the dates, from the source and in the manner provided herein and in the Note. The principal and interest are payable solely from and secured by revenues and proceeds derived from the Loan Aqreement, the Mortqaqe, the Guaranty and the Assignment of Leases and Rents, which revenues and proceeds are hereby specifically pledged to the payment thereof in the manner and to the extent specified in the Note, the Loan Agreement, the Mortqaqe, the Guarantv and the Assignment of Leases and Rents; and nothing in the Note or in this Resolution shall be considered as assigning, pledging or otherwise encumbering an_y.other funds or assets of the City. 3 -2. Performance of and Authority for Covenants. The City covenants that it will faithfully perform at all times any and all covenants, undertakings, stipulations and provisions contained in this Resolution, in the Note executed, authenticated -and delivered hereunder and in all proceedings of the City Council pertaining thereto; that it is duly authorized under the Constitution and laws of the State of Minnesota including particularly and without limitation the-Act, to issue the Note authorized hereby, pledge the revenues and assign the Loan Agreement in the manner and to the extent set forth in this Resolution, the Note, and the Loan Agreement -and the Pledge Agreement; that all action on its part for the issuance of the Note and for the execution and delivery thereof has been duly and effectively taken; and that the Note in the hands of the Lender is and will be a valid and enforceable obligation of the City according to the terms thereof. 3 -3. Enforcement and Performance of Covenants. The Citv aqrees to perform all covenants and other provisions pertaining to the City contained in the Note, the Loan Agreement, the Pledqe Agreement and the Construction Loan Agreement. L _l 10 RESOLUTION NO. 80 -286 1 11 3 -4. Nature of Securitv. Notwithstandinq anvthinq contained in the Note, the Mortgage, the Assignment of Leases and Rents, the Loan Agreement or anv other document referred to in Sectin 2 -4 to the contrary, under the provisions of the Act the Note may not be payable from or be a charge upon anv funds of the City other than the revenues and proceeds pledged to the payment thereof, nor shall the City be subject to any liability thereon, nor shall the Note otherwise contribute or give rise to a pecuniary liability of the City or, to the extent permitted by law, any of the City's officers, employees and agents. No holder of the Note shall ever have the right to compel any exercise of the taxing power of the City to pay the Note or the interest thereon, or to enforce payment thereof against any property of the City; and the Note shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City; and the Note shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation; but nothing in the Act impairs the rights of the Lender to enforce the covenants made for the security thereof as provided in this Resolution, the Loan Agreement, the Mortgage, the Assignment of Leases and Rents, the Construction Loan Agreement, the Guaranty and in the Act, and by authority of the Act the City has made the covenants and agreements herein for the benefit of the Lender; provided that in any event, the agreement of the City to perform or enforce the covenants and other provisions contained in the Note, the Loan Agreement, the Pledge Agreement and the Construction Loan Agreement shall be subject at all times to the availability of revenues under the Loan Agreement sufficient to pay all costs of such performance or the enforcement thereof, and the City shall not be subject to any personal or pecuniary liability thereon. 1 11 RESOLUTION NO. 80 -286 ARTICLE FOUR MISCELLANEOUS 4 -1. Severabilitv. If any provision of this Resolution shall be held or deemed to be or shall, in fact, be inoperative or unenforceable as applied in any particular case in any jurisdiction or jurisdictions or in all jurisdictions or in all cases because it conflicts with any provisions of any constitution or statute or rule or public policy, or for any other reason, such circumstances shall not have the effect of rendering the provision in question inoperative or unenforceable in any other case or circumstance, or of rendering any other provision or -provisions herein contained invalid, inoperative, or unenforceable to any extent whatever. The invalidity of any one or more phrases, sentences, clauses or paragraphs in this Resolution contained shall not affect the remaining portions of this Resolution or any part thereof. 4 -2. Authentication of Transcript. The officers of the City are directed to furnish to Bond Counsel certified copies of this Resolution and all documents referred to herein,'and affidavits or certificates as to all other matters which are reasonably necessary to evidence the validity of the Note. All such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute recitals of the City as to the correctness of all statements contained therein. 4 -3. Registration of Resolution. The City Manager is authorized and directed to cause a copy of this Resolution to be filed with the Director of Finance of Hennepin County, and to obtain from said Director of Finance a certificate that the Note as a bond of the City has been duly entered upon his bond register. 4 -4. Authorization to Execute Agreements. The forms of the proposed Loan Agreement, the Pledge Agreement, the Municipality Financing Statement and the Construction Loan Agreerient.are hereby approved in substantially the form heretofore presented to the City Council; and the Mayor, the Manager and the City Clerk are I 12 RESOLUTION NO. 80 -286 authorized to execute the Loan Agreement, the Pledge Agreement, the Municipality Financing Statement and the Construction Loan Agreement in the name of and on behalf of the City with such changes as may be approved by the City Attorney and to execute such other documents as Bond Counsel consider appropriate in connection with the issuance of the Note. In the event of the absence or disability of the Mayor, the Manager or the Clerk such officers of the City as, in the opinion of the City Attorney, may act in their behalf, shall without further act or authorization of the City Council do all things and execute all instruments and documents required to be done or executed. by such absent or disabled officers. December 22, 1980 Date Mayor ATTEST: L-"C1 k 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, Bill Fignar, and Celia Scott; and the following voted against the same: none, whereupon said resolution was declared duly passed and adopted. RESOLUTION NO. 80 -286 I EXHIBIT A $600,000 COMMERCIAL DEVELOPMENT CONSTRUCTION REVENUE NOTE OF 1980 (S S REAL ESTATE PROJECT) ISSUED BY CITY OF BROOKLYN CENTER TO AMERICAN NATIONAL BANK AND -TRUST COMPANY Dated: December 1980 This instrument was drafted by: WINTHROP, WEINSTINE SEXTON 2380 American National Bank Building Saint Paul, Minnesota 55101 RESOLUTION NO. 80 -286 UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN CITY OF BROOKLYN CENTER Commercial Development Construction Revenue Note of 1980 (S S Real Estate Project) $600,000.00 1. FOR VALUE RECEIVED, the CITY OF BROOKLYN CENTER, Hennepin County, State of Minnesota "the Municipality hereby promises to pay to AMERICAN NATIONAL BANK AND TRUST COMPANY, a national banking association with its main banking house located in Saint Paul, Minnesota "the Lender its successors or registered assigns, from the source and in the manner hereinafter provided, the principal sum of SIX HUNDRED THOUSAND AND 00 /100 DOLLARS ($600,000.00), or so much thereof which has been advanced to or for the benefit of the Municipality pursuant to that certain construction loan agreement of even date herewith by and among the Municipality, the Lender and S S Real Estate, a Minnesota general partnership "Borrower (said construction -loan agreement hereinafter referred to as the "Construction Loan Agree- ment"), and which remains unpaid from time to time "the Principal Balance with interest thereon at a rate equal at all times to (unless otherwise specified herein) the greater of (1)..70 times the Prime Rate of Interest as the same changes from time to time and is adjusted in the manner hereinafter set forth, or (ii) prior to December 31, 1981, nine percent (9 per annum, and on and after said date, ten and one -half percent (10Y2 per annum, accruing as of the date hereof, in any coin or currency which at the time or times of payment is legal tender for the payment of public or private debts iri the United States of America. 2. Accrued interest shall be calculated, billed, due and payable monthly on the first {1st) day of each calendar month commencing February 1, 1981, and continuing thereafter until the Principal Balance is paid in full, and the Principal Balance plus accrued interest thereon shall be due and payable in full on November 7, 1982 "Final Maturity Date 3. All payments. made by or for the account of the Municipality hereunder shall, at the option of the Lender, first be applied to any late charges due hereunder, next to accrued interest and the remainder thereof to the Principal Balance. 4. If the interest on this Note should become subject to federal income taxation pursuant to a Determination of Taxability, then the rate of interest hereunder shall -be automatically increased, and shall thereafter be equal at all times, to the greater of W two percent (2%) per annum in excess of the Prime Rate of Interest as the same changes from time to time and be adjusted in the manner hereinafter set forth, or (ii) prior to December 31, 1981, twelve percent (12 per annum and on and after said date thirteen and one -half percent (13Y2 per annum. In such event, the Lender shall also be entitled to receive and the :Municipality shall pay an amount equal to the aggregate difference between (i) the monthly payments of accrued interest theretofore made to the Lender on this Nate between the date of receipt of such Determination of Taxability by the Lender and the Date of Taxability, and (ii) the monthly payments of accrued interest which would have been made during such period if said increased rate of interest had been in effect throughout such period. If any party contests or appeals a Determination of Taxability RESOLUTION NO. 80 -286 and subsequently prevails on such contest or appeal, the foregoing charge plus any interest paid by the Municipality at such increased rate of interest shall be refunded, without interest, by the Lender to the Municipality. In addition, if the Lender and the Construction Loan Agreement, receives a Determination of Taxability and the Determina- tion of Taxability is not subject to further appeal or contest, the Lender shall have the right to declare an Event of Default under Section 15 hereof and to take any of the remedial steps provided for in said Section 15. The obligation of the Municipality to pay such additional charge shall survive full payment and satisfaction of this Note. 5. Interest shall be computed on the basis of a 360 day year, but charged for the actual number of days principal is unpaid. 6. Principal and interest and any penalty, charge or premium due hereunder shall be payable at the principal office of the Lender, or at such other place as the Lender may designate in writing. 7. This Note is issued by the Municipality to provide funds for a Project, as defined in Minnesota Statutes Section 474.02, Subdivision 1(a), consisting of the acquisition of land located within the Municipality and constructing and equipping thereon a retail furniture and interiors facility pursuant to the Loan Agreement and the Construction Loan Agreement, and this Note is further issued pursuant to and in full compliance with the Constitution and laws of the State of Minnesota, particularly Minnesota Statutes, Chapter 474 and the City Charter, and pursuant to the Resolution. S. This Note is secured by the Pledge Agreement, the Mortgage, the Assignment of Leases and Rents and the Guaranty (said documents hereinafter collectively referred to as the "Security Documents and is entitled to all of the security and benefits provided for in such agreements. The disbursement of the proceeds of the loan evidenced by this Mote is subject to the terms and conditions of the Construction Loan Agreement. 9. The Lender may extend the times of payment of interest and /or principal of or any penalty, charge or premium due on this Note, including the Final Maturity Date, without notice to or consent of any party liable hereon and without releasing any such party; provided, however, that in no event may the Final Maturity Date be extended beyond thirty (30) years from the date hereof. 10. This Note may be prepaid by the Municipality either in whole or in part, on the date of any monthly installment of interest due hereunder, without premium or penalty. 11. If any payment of accrued interest hereunder is not made within ten (10) days of the due date thereof, the Lender shall be entitled to receive, and the Municipality shall pay, a late charge equal to four percent (4%) of the amount of such interest payment; provided, however, that nothing contained herein shall constitute a waiver of any Event of Default resulting from such failure of the Borrower to make such interest payment when due. 12. All prepayments shall, at the option of the Lender, first be applied to the prepayment premium or late charges, if any, then to accrued interest and the remainder thereof to the Principal Balance. All payments made by the Municipality or by the Borrower for the benefit of the Municipality hereunder using Net Proceeds or proceeds derived from the sale of any collateral securing this Note (whether or not with the consent of the Lender) shall, unless otherwise agreed in writing, be deemed a prepayment for purposes of this Note. No prepayment shall affect the amount or timing of any other regular installment payment otherwise required to be made hereunder. —2— RESOLUTION NO. 80 -286 13. All of the agreements, conditions, covenants, provisions and stipulations contained in the Resolution, the Security Documents, the Loan Agreement and the Construction Loan Agreement are hereby made a part of this Note to the same extent and with the same force and effect as if they were fully set forth herein. 14. This Note and interest hereon and any penalty, charge or premium due hereunder are payable by the Municipality solely from the revenues and proceeds derived from the Loan Agreement and the Pledge Agreement, do not constitute a debt of the Municipality within the meaning of any constitutional or statutory limitation, are not payable from or a charge upon any funds of the Municipality other than the revenues and proceeds pledged by the Municipality to the payment thereof, and do not give rise to a pecuniary liability of the Municipality nor, to the extent permitted by law, of any of its officers, agents or employees, and no holder of this Note shall ever have the right to compel any exercise of the taxing power of the Municipality to pay this Note or the interest hereon or any penalty, charge or premium due hereunder, or to enforce payment thereof against any property of the Municipality, and this Note does not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the Municipality except as provided in the Pledge Agreement, and the agreement of the Municipality to perform or cause the performance of the covenants and other provisions herein referred to shall be subject at all times to the availability of revenues or other- funds furnished for such purpose in accordance with the Loan Agreement, sufficient to pay all costs of such performance or the enforcement thereof. 0. It is agreed that time is of the essence of this Note. If any Event of Default shall occur, then the Lender shall have the right and option to declare the Principal Balance and accrued interest thereon immediately due and payable, whereupon the Principal Balance plus accrued interest and any other penalties, charges and premiums shall be immediately due and payable by the Municipality to the Lender. Failure to exercise such option at any time shall not constitute a waiver of the right to exercise the same at any subsequent time. Ib. TQe remedies of the Lender, as provided herein, by law and in the Security Documents, the Loan Agreement and the Construction Loan Agreement, are not exclusive and shalt be cumulative and concurrent and may be pursued singly, successively or together, at the sole discretion of the Lender, and may be exercised as often as occasion therefor shall occur; and the failure to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. 17. The Lender shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by the holder and then only to the extent specifically set forth in the writing. A waiver with reference to one event shall not be construed as continuing or as a bar to or waiver of any right or remedy as to a subsequent event. 18. This Note has been issued without registration under state or federal securities laws, pursuant to an applicable exemption for such issuance and, accordingly, this Note may not be assigned or transferred, in whole or in part, nor may a participation interest in this Nate be sold pursuant to any participation agreement, except in accordance with an applicable exemption from such registration requirements. 19. All capitalized terms used herein not otherwise defined herein shall have the respective meaning assigned to such term in the Construction Loan Agreement, including, without limitation, the following terms: Loan Agreement; Resolution; Net Proceeds; Mortgage; Assignment of Leases and Rents; Guaranty; Project; Determination of Taxabil- -3— RESOLUTION NO. 80-286 ity; and Date of Taxability. The term "Prime Rate of Interest" shall mean the prime of rate of interest set from time to time by the Lender as a basis for determining the rate of interest on commercial borrowing. 20. The Municipality hereby waives presentment, demand, protest and notices of protest and dishonor. 21. As provided in the Resolution and subject to certain limitations set forth therein, this Note is transferable upon the books of the Municipality at the office of the Clerk of the Municipality by the Lender in person or by its agent duly authorized in writing, at the Lender's expense, upon surrender hereof together with a written instrument of transfer satisfactory to the Clerk of the Municipality duly executed by the Lender or its duly authorized agent. Upon such transfer the Clerk of the Municipality will note the date of registration and the name and address of the new registered holder in the registration blank appearing below. The Municipality may deem and treat the person in whose name this Note is last registered upon the books of the Municipality with such registration noted on this Note, as the absolute owner hereof, whether or not overdue, for the purpose of receiving payment of or on account of the Principal Balance or interest and for all other purposes, and all such payments so made to the Lender or upon its order shall be valid and effectual to satisfy and discharge the liability of the Municipality hereunder to the extent of the sum or sums so paid, and the Municipality shall not be affected by any notice to the contrary. IT IS HEREBY CERTIFIED AND RECITED that all conditions, acts and things required to exist, happen and be performed precedent to or in the issuance of this Note do exist, have happened and have been performed in regular and due form as required by law. IN WITNESS WHEREOF, the Municipality has caused this Note to be duly executed in its name by the manual signatures of the Mayor and the Manager and its seal to be affixed hereto, and has caused this Note to be dated December 1980. CITY OF BROOKLYN CENTER, MINNESOTA Mayor �z/ Countersigned: City Manager (SEAL) RESOLUTION NO. 80 -286 1 i 1 PROVISIONS AS TO REGISTRATION The ownership of the Principal Balance of this Note and the interest accruing thereon is registered on the books of the City of Brooklyn Center, Minnesota, in the name of the holder last noted below. Date of Registration Name and Address of Registered Holder December American National Bank and Trust Company 1980 Saint Paul, Minnesota 55101 Signature of City Clerk