HomeMy Public PortalAbout1988-097Extract of Minutes of Meeting of the
City Council of the City of Medina, Minnesota
Pursuant to due call and notice thereof, a regular
meeting of the City Council of the City of Medina, Minnesota
was duly held at City Hall in said City of Medina, on the 20th
day of December, 1988, at 8:00 o'clock P.M.
The following Council members were present;
and the following were absent:
* * *
Council member Mitchell then introduced the
following written resolution and moved the adoption thereof:
A RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE
OF INDUSTRIAL DEVELOPMENT REVENUE BONDS
PURSUANT TO MINNESOTA STATUTES, SECTIONS 469.152 TO 469.165,
TO PROVIDE FUNDS FOR INDUSTRIAL DEVELOPMENT PROJECT
ON BEHALF OF HIGHWAY 18 & 55 PROPERTIES
The motion for the adoption of the foregoing
resolution was duly seconded by Council member Schmit
and upon vote being taken thereon the following voted in favor
thereof: Schmit, Mitchell, Theis, Scherer
and the following voted against the same: None
whereupon said resolution was declared duly passed and adopted.
absent: Anderson
2318f
RESOLUTION NO.
A RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE
OF INDUSTRIAL DEVELOPMENT REVENUE BONDS
PURSUANT TO MINNESOTA STATUTES, SECTIONS 469.152 to 469.165,
TO PROVIDE FUNDS FOR INDUSTRIAL DEVELOPMENT PROJECT
ON BEHALF OF HIGHWAY 18 & 55 PROPERTIES
BE IT RESOLVED by the City Council of the City of
Medina, Minnesota (the "City"), as follows:
1. Authority. The City is, by the Constitution and
laws of the State of Minnesota, including Minnesota Statutes,
Sections 469.152 to 469.165, 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.
The Borrower described below has proposed to this Council that
the City issue and sell its $2,450,000 City of Medina
Industrial Development Revenue Bonds (Highway 18 & 55
Properties Project), Series 1988, in substantially the form set
forth in the hereinafter -mentioned Indenture of Trust (the
"Bonds") pursuant to the Act and loan the proceeds thereof to
Highway 18 & 55 Properties, a limited partnership organized and
existing under the laws of Minnesota (the "Borrower"), to
finance the costs of acquiring, constructing and equipping a
manufacturing facility in the City, to be located in the
southwest quadrant of the intersection of Highway 55 and Willow
Drive in the City, together with necessary site improvements
(the "Project"), to be owned by the Borrower and leased by the
Borrower to DeVac, Inc., a Minnesota corporation (the
"Lessee"). Forms of the following documents relating to the
Bonds and the Project have been submitted to the City Council
and are now on file in the office of the City Clerk -Treasurer:
(a) Loan Agreement (the "Loan Agreement") dated as of
December 1, 1988, between the City and the Borrower,
whereby the City agrees to make a loan to the Borrower of
the gross proceeds of sale of the Bonds and the Borrower
agrees to complete the Project and to pay amounts in
repayment of the loan sufficient to provide for the full
and prompt payment of the principal of, premium, if any,
and interest on the Bonds; and
(b) Indenture of Trust (the "Indenture") dated as of
December 1, 1988, between the City and First Trust National
Association, as Trustee, pledging revenues, including those
to be derived from the Loan Agreement, as security for the
Bonds, and setting forth proposed recitals, covenants and
agreements relating thereto; and
(c) Letter of Credit (the "Letter of Credit") to be
issued by First Bank National Association (the "Bank") to
the Trustee, supporting payment of the principal of and
interest on the Bonds (this document not to be executed by
the City); and
(d) Reimbursement Agreement (the "Reimbursement
Agreement") dated as of December 1, 1988, between the
Borrower and the Bank, pursuant to which the Borrower
agrees to reimburse the Bank for amounts drawn under the
Letter of Credit and makes certain covenants (this document
not to be executed by the City); and
(e) Private Placement Agreement (the "Placement
Agreement"), between FBS Capital Markets Group (the
"Placement Agent"), the Borrower and the City, providing
for the placement of the Bonds by the Placement Agent and
setting the terms and conditions thereof; and
(f) Remarketing Agreement (the "Remarketing
Agreement") dated as of December 1, 1988, between the
Borrower and the Placement Agent, as Remarketing Agent,
providing for the remarketing of the Bonds from time to
time, as provided for in the Indenture, as further provided
therein (this document not to be executed by the City); and
(g) Private Placement Memorandum (the "Private
Placement Memorandum"), describing the private placement of
the Bonds, and certain terms and provisions of the
foregoing documents.
3. Findings. It is hereby found, determined and
declared that:
(a) The Project, based upon information furnished by
the Borrower, constitutes a project authorized by and
described in Section 469.153, Subdivision 2a, of the Act.
(b) The Project furthers the purposes set forth in
the Act in that the purpose of the Project is and the
effect thereof will be to promote the public welfare by the
active promotion, attraction, encouragement and development
of economically sound industry and commerce through
governmental action for the purpose of preventing the
emergence of blighted and marginal lands and areas of
chronic unemployment; by increasing employment
opportunities in the City; and by the more intensive
development of land available in the area to provide a more
adequate tax base to finance the costs of governmental
services in the Municipality, county and school district
where the Project is located.
(c) The Project has been approved by the Department
of Trade and Economic Development of the State of Minnesota
as tending to further the purposes and policies of the Act.
(d) There is no litigation pending or, to the best of
its knowledge, threatened against the City relating to the
Project or to the Bonds, the Loan Agreement, the Private
Placement Agreement or the Indenture or questioning the
organization, powers or authority of the City.
(e) The execution, delivery and performance of the
City's obligations under the Bonds, the Indenture, the
Private Placement Agreement and the Loan Agreement do not
and will not violate any charter provision or any order of
any court or other agency of government of which the City
is aware or in which the City is a party, 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.
(f) It is desirable that the 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 will be pledged to the Trustee as security for
the payment of principal of, premium, if any, and interest
on the Bonds.
(g) The Loan Agreement provides for payments by the
Borrower to the Trustee for the account of the City of such
amounts as will be sufficient to pay the principal of,
premium, if any, and interest on the Bonds when due. The
Loan Agreement obligates the Borrower to provide for the
payment of operation and maintenance expenses, including
adequate insurance, taxes and special assessments. No
reserve fund has been deemed necessary to be established in
connection with the issuance of the Bonds.
(h) Under the provisions of the Act, and as provided
in the Loan Agreement and Indenture, the Bonds are not to
be payable from nor charged upon any funds other than
amounts payable pursuant to the Loan Agreement 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
Indenture shall recite that the Bond, including interest
thereon, shall not constitute or give rise to a charge
against the general credit or taxing powers of the City.
4. Approval and Execution of Documents. The forms of
Loan Agreement, Indenture, Letter of Credit, Reimbursement
Agreement, Private Placement Agreement, and Remarketing
Agreement, 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 or Acting Mayor and the City
Clerk -Treasurer, or other officers of the City, 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, which approval
shall be conclusively evidenced by the execution thereof, and
then sall be delivered to the Trustee. The Private Placement
Agreement shall be executed by one or more officers of the City
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 officer or officers executing the same, which
approval shall be conclusively evidenced by the execution
thereof. The forms of Remarketing Agreement, Letter of Credit
and Reimbursement Agreement now on file may be modified after
the date hereof as determined to be necessary or desirable by
the Bank, the Borrower, the Placement Agent or Bond Counsel.
5. Approval, Execution and Delivery of Bonds. The
City shall proceed forthwith to issue the Bonds, to be dated
the date of initial delivery thereof, in the aggregate
principal amount of $2,450,000 in the form and upon the terms
set forth in the Indenture, which terms are for this purpose
incorporated in this resolution and made a part hereof. The
Placement Agent has agreed pursuant to the provisions of the
Private Placement Agreement to privately place the Bonds at the
purchase price set forth in the Private Placement Agreement,
and said purchase price is hereby found to be favorable and is
hereby accepted. The Mayor, Acting Mayor and City
Clerk -Treasurer are authorized and directed to prepare and
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execute the Bonds as prescribed in the Indenture and to deliver
them to the Trustee, together with a certified copy of this
Resolution and the other documents required by the Indenture,
for authentication, registration and delivery to the Placement
Agent. As provided in the 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 Placement Memorandum. The City hereby
consents to the use by the Placement Agent of the Private
Placement Memorandum in privately placing the Bonds; provided,
however, that the City has not participated in the preparation
of the Private Placement Memorandum or independently verified
the information in the Private Placement Memorandum and takes
no responsibility for, and makes no representations or
warranties as to, the accuracy or completeness of such
information.
7. $10 Million Election. The City hereby elects that
the $10 million election with respect to the Bonds and certain
capital expenditures for the Project, as provided under Section
144(a) of the Internal Revenue Code of 1986, as amended, shall
apply to the Bonds and the Project.
8. Certificates, etc. The Mayor, Acting Mayor, City
Clerk -Treasurer, and other officers of the City are authorized
and directed to prepare and furnish to bond counsel and the
Placement Agent, 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 represesntations of the
City as to the truth of all statements contained therein.
9. Authorization. The City Clerk -Treasurer is
authorized and directed to deliver a certified copy of this
Bond Resolution to the County Auditor, together with such other
information as such 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.