Loading...
HomeMy Public PortalAbout2010-010 Resolution Approving & Awarding Sale of & Providing Terms, Covenants etc.Member Smith introduced the following resolution and moved its adoption: CITY OF MEDINA RESOLUTION NO.2010-10 RESOLUTION APPROVING AND AWARDING THE SALE OF, AND PROVIDING THE FORM, TERMS, COVENANTS AND DIRECTIONS FOR THE ISSUANCE OF ITS LIMITED TAXABLE TAX INCREMENT REVENUE NOTES, SERIES 2010 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $2,000,000 BE IT RESOLVED BY the city council of the city of Medina, Minnesota (the "City") as follows: Section 1. Authorization; Award of Sale. 1.01. Authorization. The City has heretofore approved the establishment of Tax Increment Financing District No. 1-9 (the "TIF District") within Development District No. 1 (the "Development District"), and has adopted a tax increment financing plan for the purpose of financing certain improvements within the Development District. The City has previously approved a Contract for Private Development dated September 21, 2005 (the "Agreement") by and between Ryan Companies US, Inc. ("Ryan") and the City. Pursuant to the Agreement, Ryan agreed to construct certain public improvements and Target Corporation ("Target") agreed to open and operate a Target store within the Development District. Pursuant to Minnesota Statutes Section 469.178, the City is authorized to issue and sell its Notes for the purpose of financing a portion of the public development costs of the Development District. Such Notes are payable from the Available Tax Increment, as defined in the Agreement, and pledged to the payment of the Notes. The City hereby finds and determines that it is in the best interests of the City that it issue and sell its Limited Taxable Tax Increment Revenue Notes, Series 2010 in an aggregate principal amount of $2,000,000 (the "Notes") for the purpose of financing certain costs of the Development District, which Notes replace and are not in addition to the City's Limited Taxable Tax Increment Revenue Notes, Series 2009. 1.02. Issuance, Sale, and Terms of the Notes. The City hereby authorizes issuance of the Notes in accordance with terms set forth in this resolution to Target in the principal amount of $1,234,600 and to Ryan in the principal amount of $765,400, at a price of par. The Notes shall be dated as of the date of delivery and shall bear interest at an annual rate of 6.5 percent from July 1, 2006 to the earlier of maturity or prepayment. 1.03. Qptional Redemption. The City may prepay the Notes in whole or in part, without premium or penalty, on any date. Resolution No. 2010-10 February 3, 2010 Section 2. Form of Notes. The Notes shall be in substantially the following form, with the blanks to be properly filled in: UNITED STATE OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN CITY OF MEDINA No. R- $ LIMITED TAXABLE TAX INCREMENT REVENUE NOTE, SERIES. 2010 Date Rate of Original Issue 6.5% February 3, 2010 The city of Medina, Minnesota (the "City"), for value received, certifies that it is indebted and hereby promises to pay to , or registered assigns (the "Owner"), but solely from the sources, to the extent and in the manner hereinafter identified, the principal amount specified above, at 6.5 percent annual interest thereon from July 1, 2006, payable on each February 1 and August 1 ("Payment Dates"), commencing August 1, 2009 and continuing to and including February 1, 2023, and on each February 1 and August 1 during the five-year automatic extension of the term of this Note in the event of a Deficiency as hereinafter provided. Interest shall accrue on the unpaid principal, commencing on July 1, 2006. Interest shall be computed on the basis of a year of 360 days. Payments are payable by mail to the address of the Owner or such other address as the Owner may designate upon 30 days written notice to the City. Payments on this Note are payable in any coin or currency of the United Sates' of America which, on the Payment Date, is legal tender for the payment of public and private debts. This Note is subject to prepayment in whole or in part at the option of the City on any date without premium or penalty. No partial prepayment shall affect the amount or timing of any other regular payment otherwise required to be made under this Note. This Note is one of an issue of two in the total original principal amount of $2,000,000, both issued to aid in financing certain development costs of a Development Program undertaken by the City pursuant to Minnesota Statutes, Sections 469.124 through 469.134, and is issued pursuant to an authorizing resolution (the "Resolution") duly adopted by the City on February 3, 2010, and pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.174 to 469.179. This Note is a limited obligation of the City which is payable solely from Available Tax Increment, as defined in that certain Contract for Private Development by and between the City and Ryan Companies US, Resolution No. 2010-10 2 February 3, 2010 Inc., dated September 21, 2005 (the "Agreement"), pledged to the payment hereof under the Resolution, the terms of which are hereby incorporated by reference. This Note replaces and is not in addition to the City's Limited Taxable Tax Increment Note, Series 2009 of like amount, maturity and tenor. This Note shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, the City. Neither the State of Minnesota, nor any political subdivision thereof shall be obligated to pay this Note or other costs incident hereto except out of moneys pledged thereto under the Resolution, and neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment of this Note or other costs incident hereto. The City shall pay to the Owner on each Payment Date its proportionate share ( %) of the Available Tax Increment unless there is an uncured Event of Default by the Owner pursuant to the provisions of the next paragraph. Except with regard to any Deficiency, as defined in the Agreement, if any amount payable under this Note has not been paid by February 1, 2023, such amount not paid shall be forgiven and the City shall have no further liability with respect thereto. If a Deficiency occurs and the Note has not been paid in full, the term of this Note will automatically be extended for such period as is necessary to receive five additional years of Available Tax Increment or to such earlier date when the Deficiency has been paid in full. If as of any Payment Date there is an uncured Event of Default under the Agreement by the Owner, the City may withhold Available Tax Increment otherwise payable on such Payment Date and which is due such Owner. If there is more than one Owner under the Note, then only a pro rata portion of the Available Tax Increment which is otherwise payable on such Payment Date to such Owner that is in default may be withheld. The right to withhold Available Tax Increment is subject to Article XI of the Development Agreement, including Section 11.3(c). If the default is cured in accordance with the Agreement, the amount that is withheld shall be paid, without interest thereon, within 10 days after the default is cured. This Note is issuable only as a fully registered note without coupons. As provided in the Resolution, and subject to certain limitations set forth therein, this Note is transferable in whole or in part upon the books of the City kept for that purpose at the principal office of Medina's city administrator -clerk, by the Owner hereof in person or by the Owner's attorney duly authorized in writing, upon surrender of this Note together with a written instrument of transfer satisfactory to the City, duly executed by the Owner. Upon such transfer or exchange and the payment by the Owner of any tax, fee, or governmental charge required to be paid by the City with respect to such transfer or exchange, there will be issued in the name of the transferee a new Note of the same aggregate principal amount or such lesser amount as designated by the Owner with the balance in a new Note to the Owner, both of which Notes shall have the same terms and conditions as set forth in this Note, except such Notes shall be in different amounts which total the amount of this Note and shall specify the portion of Available Tax Increment to be paid on each Note. The City shall have a right of setoff against the principal portion of this Note as provided in Sections 6.4, 6.5, 6.6 and 12.2(b) of the Agreement. Resolution No. 2010-10 3 February 3, 2010 The Note shall not be transferred in whole or in part to any person other than to Target or an affiliate or other related entity of the Owner unless the City has been provided with an investment letter in a form substantially similar to the investment letter submitted by the Owner or a certificate of the transferor, in a form satisfactory to the City, that such transfer is exempt from registration and prospectus delivery requirements of federal and applicable state securities laws. If the City defaults in its obligations to the Owner hereunder, then the City shall pay the Owner for all of the out-of-pocket expenses, including, but not limited to attorneys fees and costs, incurred by the Owner for the collection of the payments due or to become due or for the enforcement of the performance or observance of any of the obligations or agreements on the part of the City under this Note. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen, and to be performed in order to make this Note a valid and binding limited obligation of the City according to its terms, have been done, do exist, have happened, and have been performed in due form, time and manner as so required. This Note shall not be valid or become obligatory for any purpose until the Certificate of Authentication hereon shall have been manually signed by the Registrar. IN WITNESS WHEREOF, the city council of the city of Medina, Minnesota, has caused this Note to be executed with the manual signatures of its mayor and city administrator -clerk, all as of the Date of Original Issue specified above. CITY OF MEDINA Z,./t 1)1. City Administrator -Clerk Mayor REGISTRATION PROVISIONS The ownership of the unpaid balance of the within Note is registered in the bond register of the Medina's city administrator -clerk, in the name of the person last listed below. Date of Signature of Registration Registered Owner City Administrator -Clerk Resolution No. 2010-10 4 February 3, 2010 Section 3. Terms, Execution and Delivery. 3.01. Denomination, Payment. The Notes shall be issued as typewritten notes numbered R-1 and R-2. The Notes shall be issuable only in fully registered form. Payments on the Notes shall be payable by check or draft issued by the Registrar described herein. 3.02. Payment Dates. Principal of and interest on the Notes shall be payable by mail to the owner of record thereof as of the close of business on the fifteenth day of the month preceding the Payment Date, whether or not such day is a business day. 3.03. Registration. The City hereby appoints the city administrator -clerk to perform the functions of registrar, transfer agent and paying agent (the "Registrar"). The effect of registration and the rights and duties of the City and the Registrar with respect thereto shall be as follows: (a) Register. The Registrar shall keep at its office a bond register in which the Registrar shall provide for the registration of ownership of the Notes and the registration of transfers and exchanges of the Notes. (b) Transfer of Notes. Upon surrender for transfer of any Note duly endorsed by the registered owner thereof or accompanied by a written instrument of transfer, in form reasonably satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, the Registrar shall authenticate and deliver, in the name of the designated transferee or transferees, a new Note or Notes of a like aggregate principal amount, or such lesser amount, and maturity, as requested by the transferor. Notwithstanding the foregoing, no Note shall be transferred to any person (other than to Target or to an affiliate or other related entity of the Owner) unless the City has been provided with an opinion of counsel or a certificate of the transferor, in a form satisfactory to the City, that such transfer is exempt from registration and prospectus delivery requirements of federal and applicable state securities laws. The Registrar may close the books for registration of any transfer after the fifteenth day of the month preceding each Payment Date and until such Payment Date. (c) Cancellation. Any Note surrendered upon a transfer shall be promptly cancelled by the Registrar and thereafter disposed of as directed by the City. (d) Improper or Unauthorized Transfer. When any Note is presented to the Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement on such Note or separate instrument of transfer is legally authorized. The Registrar shall incur no liability for its refusal, in good faith, to make transfers which it, in its judgment, deems improper or unauthorized. Resolution No. 2010-10 5 February 3, 2010 (e) Persons Deemed Owners. The City and the Registrar may treat the persons in whose names the Notes are at any time registered in the bond register as the absolute owners of the Notes, whether the Notes shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of, and interest on, each such Note and for all other purposes, and all such payments so made to any such registered owners or upon the owners' order shall be valid and effectual to satisfy and discharge the liability of the City upon such Note to the extent of the sum or sums so paid. (f) Taxes, Fees and Charges. For every transfer or exchange of a Note, the Registrar may impose a charge upon the owner thereof sufficient to reimburse the Registrar for any tax, fee, or other governmental charge required to be paid with respect to such transfer or exchange. (g) Mutilated, Lost, Stolen or Destroyed Notes. In case any Note shall become mutilated or be lost, stolen, or destroyed, the Registrar shall deliver a new Note of like amount, maturity dates and tenor in exchange and substitution for and upon cancellation of such mutilated Note or in lieu of and in substitution for such Note lost, stolen, or destroyed, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case the Note lost, stolen, or destroyed, upon filing with the Registrar of evidence satisfactory to it that such Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing to the Registrar of an appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both the City and the Registrar shall be named as obligees. The Note so surrendered to the Registrar shall be cancelled by it and evidence of such cancellation shall be given to the City. If the mutilated, lost, stolen, or destroyed 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. (h) Prepayment. In the event a Note is prepaid, notice thereof will be given by the Registrar by mailing a copy of the redemption notice by first class mail (postage prepaid) not more than 60 and not less than 30 days prior to the date fixed for prepayment to the registered owner of the Note to be prepaid at the address shown on the registration books kept by the Registrar and by publishing the notice if required by law. Failure to give notice by publication or by mail to any registered owner, or any defect therein, will not affect the validity of the proceedings for the prepayment of the Note. 3.04. Preparation and Delivery. The Notes shall be prepared under the direction of the city administrator -clerk and shall be executed on behalf of the City by the signatures of its mayor and city administrator -clerk. In case any officer whose signature shall appear on the Notes shall cease to be such officer before the delivery of the Notes, such signature shall nevertheless be valid and sufficient for all purposes, the same as if such officer had remained in office until delivery. When the Notes have been so executed, they shall be delivered by the city administrator -clerk to the Owners thereof upon the satisfaction of the conditions of delivery under Section 7.2(c) of the Agreement. Resolution No. 2010-10 February 3, 2010 Section 4. Security Provisions. 4.01. Pledge. The City hereby pledges to the payment of the Notes the proportionate shares (61.73% to Target and 38.27% to Ryan) of Available Tax Increment, which term has the meaning given to it in the Agreement. 4.02. Debt Service Fund. Until the date the Notes are no longer outstanding or have been paid in full (to the extent required to be paid pursuant to this resolution), the City shall maintain a separate and special fund (the "Tax Increment Fund") to be used for no purpose other than the payment of the Notes. The City irrevocably agrees to appropriate to the Tax Increment Fund Available Tax Increment in the amount consistent with the Agreement and necessary to pay amounts due on the Notes on each Payment Date. Interest earnings on funds in the Tax Increment Fund will be credited to that fund. Any Available Tax Increment remaining in the Tax Increment Fund upon payment of all amounts due under the Notes shall be available to the City for any purpose permitted by law. Section 5. Certification of Proceedings. 5.01. Certification of Proceedings. The officers of the City are hereby authorized and directed to prepare and furnish to the Owner of each Note certified copies of all proceedings and records of the City, and such other affidavits, certificates, and information as may be required to show the facts relating to the legality and marketability of the Notes as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies, certificates, and affidavits, including any heretofore furnished, shall be deemed representations of the City as to the facts recited therein. Section 6. Effective Date. This resolution shall be effective upon full execution of the Agreement. Adopted this 3rd day of February, 2010. ATTEST: Chad M. Adams, City Administrator -Clerk The motion for the adoption of the foregoing resolution was duly seconded by member Weir upon vote being taken thereon, the following voted in favor thereof: Crosby, Smith, Weir, Siitari And the following voted against same: (Absent: Johnson) None Whereupon said resolution was declared duly passed and adopted. Resolution No. 2010-10 7 February 3, 2010