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HomeMy WebLinkAbout6980 - ADMIN Resolution - City Council - 1981/10/05i •9 f r i• RESOLUTION NO. 6980 A RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF INDUSTRIAL DEVELOPMENT REVENUE BONDS PURSUANT TO CHAPTER 474, MINNESOTA STATUTES, TO PROVIDE FUNDS TO BE LOANED TO MEDVESCO FOR INDUSTRIAL DEVELOPMENT PROJECT AND APPROVING LOAN AGREEMENT, TRUST INDENTURE, LETTER OF CREDIT AGREEMENT, IRREVOCABLE LETTER OF CREDIT, MORTGAGE, STATUTORY MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT, GUARANTY OF SPECIFIC INDEBTEDNESS, GUARANTY AGREEMENT, BOND PURCHASE AGREEMENT, AND PRELIMINARY OFFICIAL STATEMENT BE IT RESOLVED by the City Council of the City of St. Louis Park, 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 author- ized 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 St. Louis Park Industrial Development Revenue Bonds (MEDVESCO 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 MEDVESCO, a Minnesota general partnership (the "Partnership"), to finance the costs of the acquisition of land in the City and the construction and equipping thereon of an office building, together with any site improvements required in 'relation thereto, to be owned by the Partnership, and leased to Geri -Care Corporation, a Minnesota corporation (the "Lessee"). 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 October 1, 1981, between the City and the Partnership whereby the City agrees to make a loan to the Partnership and the Partnership 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 October 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 the Bonds to be issued by the City, and setting forth proposed recitals, covenants and agreements relating thereto; -2- (c) Letter of Credit Agreement (the "Letter of Credit Agreement"), dated as of October 1, 1981, between the Partner ship and The First National Bank of Saint Paul (the "Bank") whereby the Partnership agrees to reimburse the Bank for the amount of each draft drawn under the hereinafter mentioned Irrevocable Letter of Credit (this document not to be execu- ted by the City); and (d) Irrevocable Letter of Credit (the "Letter of Credit"), dated as of October 9, 1981 from the Bank to the Trustee providing for payment by the Bank to the Trustee of the sum needed for payment of principal of, premium, if any, and interest on the Bonds upon presentation of a sight draft and certification by the Trustee (this document not to be executed by the City); and (e) Mortgage (the "Mortgage"), dated as of October 1, 1981, from the Partnership to the Trustee, by which the Partnership grants to the Trustee a mortgage lien on and security interest in the Mortgaged Property, as defined therein, as security for the payment of the Bonds and the performance of the Partnership's obligations under the Loan Agreement (this document not to be executed by the City); and (f) Statutory Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Financing Statement (the "Statutory Mortgage") dated as of October 1, 1981, from the Partnership to the Bank, by which the Partnership grants to the Bank a second mortgage lien on the Project and assigns to the Bank the Partnership's interests in, among other items, the lease of the Project Facilities to Geri -Care Corporation, as security for the performance of the Partner- ship's obligations under the Letter of Credit Agreement (the document not to be executed by the City); and (g) Guaranty Agreement (the "Guaranty Agreement") dated as of October 1, 1981, from Marvin R. Burton and Arnold M. Soskin (the "Guarantors") by which the Guarantors unconditionally and jointly and severally guaranty the payment of the Bonds and the obligations of the Partnership under the Loan Agreement (this document not to be executed by the City); and (h) Guaranty of Specific Indebtedness (the "Guaranty") dated as of October 1, 1981, from the Guarantors to the Bank, whereby the Guarantors unconditionally, and jointly and severally guaranty the obligations of the Partnership under the -Letter of Credit Agreement (this document not to be executed by the City); and (i) Bond Purchase Agreement (the "Bond Purchase Agree- ment") dated October 5, 1981, from Piper, Jaffray & Hopwood Incorporated (the "Underwriter") to the Partnership and the City providing for the purchase of the Series 1981 Bonds by -3- f r 1 the Underwriter and setting the terms and conditions of purchase; and (j) Preliminary Official Statement dated September 30, 1981, describing the offer of the Bonds, certain terms and , provisions of the foregoing documents, and certain information concerning the Bank and the Partnership as deemed material by the Bank and the Partnership. 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, Subd. 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, Bond Purchase Agreement and Trust Indenture and the performance of all covenants and agreements of the City contained in the Bonds, the -Loan Agreement, Bond Purchase 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, Bond Purchase Agreement and Trust Indenture and the Bonds valid and binding obligations of the City in accordance with their terms, are authorized by the Act. (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, Bond Purchase Agreement, 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, Bond Purchase Agreement, 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,,w .,thy result in a breach of, or constitute (with ,,,L,0,;due; not"cep or lapse of time or both) a default under any such indenture, agreement or other instrument. (g) It is desirable that the City of St. Louis Park Industrial Development Revenue Bonds (MEDVESCO Project), Series 1981, in the amount of $1,500,000 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 Partnership 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 Partnership 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 Partnership 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, the Bond Purchase Agreement or Bonds, (ii) owns any capital stock of the Lessee or other interest in the Project or the Partnership, (iii) is a partner of the Partnership, (iv) will be involved in supervising the comple- tion of the Project on behalf of the Partnership, or (v) will receive any commission, bonus or other remuneration for -5- r f 1 or in respect of the Project, the Loan Agreement, the Bond Purchase Agreement, the Bonds or the Trust Indenture. 4. Approval and Execution of Documents. The forms of Loan Agreement, Trust Indenture, Letter of Credit Agreement, Letter of Credit, Mortgage, Statutory Mortgage, Guaranty Agreement, Guaranty, Bond Purchase Agreement, and Preliminary Official Statement referred to in paragraph 2 are approved. The Loan Agreement, Bond Purchase 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 partners of the Partnership, 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. 5. Approval, Execution and Delivery of Bond. The City shall proceed forthwith to issue its City of St. Louis Park Industrial Development Revenue Bonds (MEDVESCO Project), Series 1981, dated as of October 1, 1981, in the principal amount of $1,500,000 --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 Underwriter has agreed to purchase the Bonds at a purchase price of $1,440,000 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. Preliminary Official Statement. The City hereby consents to the use of the Preliminary Official Statement, provided that the Preliminary Official Statement shall always recite that the Appendices to the Preliminary Official Statement have been prepared by the Partnership 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 -6- 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 County Auditor for the County of Hennepin, 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. A test: ity Clerk Adopted by the City Council October 5, 1981. Mayor Approved as to foand legality: -�i/L City 'Attorney