HomeMy WebLinkAbout84-225 - ADMIN Resolution - City Council - 1984/12/28r
(SEE ALSO RES. 84-218;
RESOLUTION NO. 84-225
RESOLUTION ACKNOWLEDGING AND RATIFYING THE
SETTING OF INTEREST PATE ON THE $2,779,150
COMMERCIAL DEVELOPMENT REVENUE NOTE OF 1984
(SHEEHAN CORPORATE CENTER PARTNERSHIP PROJECT)
WHEREAS, on December 17, 1984, the City Council of
the City of St. Louis Park adopted a Final Note Resolution
(the "Resolution") authorizinq the issuance of a $2,799,150
CoTmercial Development Revenue Note of 1984 (Sheehan Corporate
Center Partnership Project) (the "Note");
WHEREAS, pursuant to the terms of the Resolution and
the Note, the interest rate on the Note is to be set by The
First National Bank of Saint Paul (the "Lender") at a rate
not less than 9.00% nor greater than 13.00% per annum, prior
to the execution and delivery of the Note;
WHEREAS, the Resolution and Note further provide
that the in rate on the Note as set by the Lender must
be acknowledged and ratified by the Mayor Pro Tem and the
City Clerk or the City Council prior to the execution and
delivery of the Dote;
WHEREAS, the Note, with the interest rate as set by
the Lender, is attached hereto as Fxhibit A.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
THE CITY OF ST. LOUIS PARK AS FOLLOWS:
1. The Council hereby acknowledges and ratifies the
interest rate as such rate is set forth in Exhibit A attached
hereto.
2. The Mayor and City Clerk or such other officers of
the City as in the opinion of the City Attorney, may act in
their behalf, are authorized to execute the Loan Agreement,
Construction Loan Agreement and Pledge Agreement, in the name
of and in behalf of the City and such other documents as Briggs
and Morgan, Professional Association, consider appropriate in
connection with the issuance of the Note, all as provided in
Section 4-4 of the Resolution.
Approved and adopted by
of December, 1984.
City Council this 28th day
Ma 'or Pro Tem
-2-
Reviewed for administration: Approved as to form and legality:
o
ity Manager City ttorne
-3-
t
EXHIBIT A
UNIT?7 STATES OF AMERICA
STATE OF MINrTESOTA
COU":TY OF HENNEPIN
CITY OF ST. LOUIS PARK
Commercial Development Revenue Note of 1984
(Sheehan Corporate Center Partnership Project)
$2,799,150
FOR VALUE RECEIVED the CITY OF ST. LOUIS PARK,
Hennepin County, Minnesota (the "City") hereby promises to pay
The First National Bank of Saint Paul, a national banking
association, in Saint Paul, Minnesota, its successors or
registered assigns (the "Lender"), from the source and in the
manner hereinafter provided, the principal sum of TWO J4ILLTON
SSVMT HUNDRED NINETY NI,;--- THOUSAND ONE HUNDRED FI nQLLARS
($2,799,150), or so much thereof as remains ury, i htA
"?rincipal Balance"), together with interes .fin sa cipal
su.-i at the rates and at the times herei Afte desc e n any
coin or currency which at the time tio ym t legal
tender for the payment of nubli or v 't d is in he nited
States of America, inacacco e it rm inafter set
forth.
accrue
11
disbursement of proceeds of this Note is maae rrom
the Construction Fund (as defined and provided in the
hereinafter defined Construction Loan Agreement), as
and for additional interest for the period from the
date hereof through December 31, 1985, the sum of
$55,983.
(ii) Commencing on the date hereof and con-
tinuing thereafter until the Principal Balance is
paid in full, interest shall accrue on the Principal
Balance at the rate of 11.25% per annum.
(b) Payments.
(i) Commencing on the first day of the month
following the delivery of this Note and continuing on
the first day of every month thereafter through and
including December 1, 1989, there shall be payable to
the Lender installments of accrued interest only at
the rate set forth in paragraph l(a)(ii) above.
V
(ii) Commencing on January 1, 1990 and con-
tinuing on the first day of every month thereafter
until and including November 1, 2014, there shall be
payable to the Lender equal blended monthly install-
ments of principal and interest of $28,272.24 each.
(iii) Payment of the Principal Balance and all
unpaid accrued interest hereon and all indebtedness
hereunder shall be Niue and payable in full on
December 1, 2014 (the "Final Maturity Date") , or such
earlier date as the maturity of this Note may be
accelerated pursuant to the terms of this Note.
2. (a) In the event that the interest on this Note
shall became subject to federal income taxation pursuant to a
Determination of Taxability (as hereinafter defined) , % ie
interest on this Note due pursuant to paragraph l(al"(.ii.1 hereof
shall be changed, retroactively effective fropi-,Ad `a�E�er\- the
Date of Taxability (as hereinafter defined, VVd sh*N a
rate equal to 15.25% per annum. The rC�ity11�1 11� erl'iate�L
upon demand pay to the Lender and„to , �cht io�'Y� olde aff cted
by such Determination of Tax�b l i' I a'n\ amku al t the
mount by which the interest' duO uncler,.f1a g
hereof accrues retroactively!, at subh i�►it
� r��s rate from the
Date of Taxabili�y_.to %the da�e of pa- ne dScceeds the amount of
interest actua3�`�y accrc ed :and,;pai t the Lender and any such
prior hol § duy rig ,said peri�d_p�rsuant to said paragraph.
Such obli. anon `f the Cit hall survive the payment in full
of this N
( e erms Determination of Taxability" and
"Date of T ity" as used herein shall have the meanings
ascribed to such terms in Section 4.07 of the Loan Agreement
( the "Loan Agreement") dated the date hereof between the City
and Sheehan Corporate Center Partnership, a Minnesota general
partnership comprised of Frantz Klodt & Son, Inc., a Minnesota
corporation, Commers enterprises, a Minnesota general partner-
ship, and Mark R. Sheehan ( the "Borrower") .
(c) The Lender will use its best efforts to give
notice (but Lender will not be liable to the Borrower or the
City or any prior holder of this Note for damages or otherwise
in the event of failure to give such notice) as soon as
practicable, but in any event before the right to appeal such
Determination of Taxability has expired, to the Borrower, the
City and any prior holder of thisNotenit
f its receiptoof any
Determination of Taxability and pe
litigate or appeal the same at its sole expense. In the event
any such contest, litigation or appeal is undertaken, the
increased interest provided in paragraph 2(a) hereof shall,
nevertheless, be payable to the Lender and, to the extent
applicable, any prior holder and shall be held by the Lender
and any such prior holder in escrow pending final disposition
of such contest, litigation or appeal, provided that the
Borrower shall inderini fy and hold harmless the Lender and each
such prior holder from any and all penalties, interest or other
liabilities which they may incur on accour-it of such contest,
litigation or appeal. In the event a Determination of
Taxability is successfully appealed by the Borrower, the Lender
and any prior holder shall return to the Borrower the amount of
interest paid to the Lender ( together with interest thereon at
a per annurn rate equal to that which is then Nvailable on basic
saving accounts available to the Borrower wite Lender) and
such prior holder pursuant to paragraph 2(�f.
3. In any event, the paymc�r�ts her'. d shall be
sufficient to pay all principal ap �iri..er t te, such
principal and interest becomes dui•, ;,ands o pay ny applicable
prepayment premium or late ch e,%At ma urLt upon accelera-
tion, or otherwise. All iterest,acicuinn this Note shale
be computed on the baso 36�,�_a�(3r, but charged for th
actual number of. days el4pse��
4. Prificipal and in rest and prepayment premiums
and late char„g,es•''due cher unr shall be payable at the
principal�G ice Qf'�the er, or at such other place as the
Lender may:des� nate in_writing.
5.� This N to is issued by the City to provide funds
for aN}Mject;� as defined in Section 474.02,
Subdivision la,
,yinnesota t es, consisting of the acquisition of real
estate, he construction of a multi -tenant office building
thereon collectively, the "Projeg.t', pursuant to the 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 Chapter 474, Minnesota Statutes, and
pursuant to a resolution of the City Council duly adopted on
December 17, 1934 (the "Resolution") .
6. This Vote is secured by, inter alia, a Pledge
Agreement of even date herewith by the City to the Lender ( the
"Pledge Agreement"), a Mortgage, Security Agreement and Fixture
Financing Statement, executed by the Borrower, as mortgagor, in
favor of the Lender, as mortgagee, of even date herewith ( the
"Mortgage") , and certain other agreements between the Borrower
and the Lender. The proceeds of the Note shall be disbursed by
i
the Lender pursuant to the Construction Loan Agreement of even
date herewith among the Lender, the City and the Borrower ( the
"Construction Loan Agreement") and the disbursement of the
proceeds of this Note is subject to the terins and conditions of
the Construction Loan Agreement.
7. The City, for itself, its successors and assigns,
hereby waives donand, presentment, protest and notice of
dishonor and agrees that without any notice, the Lender and any
present or future owner or owners of any property and interests
subject to the Mortgage or any other document given to secure
this Note, or executed in connection with t is Note, may, to
the extent permitted by law, from time to time extend, renew,
or otherwise modify the date or dates or amount or amounts of
payment above recited, or the Lender may from time to ime
release any part or parts of the property and internes subject
to the Mortgage or to any such other document,, sroN,.ihe ame,
with or without consideration; whether or nRI'Et'as aL
thereof the interest on the Note is no l�hgerNexe►npV fi''�
Federal income taxation; provided tY a� ip •,tjo tvefit mEa
t' "
e o d- thin {80) s from
Final Maturity Date be extended y y yt is the
the date hereof. In any sucY f ca st}3�e"
limitation of the City's 14 bi ,itjr,. ex eis d; ier=ein, shall, to
the extent permitted b� �K a! y Conti e b� liable to pay the
unpaid balance of the''I ndebOedness '�eyidced hereby as so
extended, rener dli £ie��,an c�no3withstanding any such
release.It
V:�
$, Thi 'V ender`` demand prepayment of the Principal
Balance ofe and all unpaid accrued interest thereon on
the tenth (1 tti� a iversary of this Note, or at any t time
thereafter hirty (30) days prior written notice
City and the rrower, in which event all said amounts shall be
immediately due and payable.
9. (a) The outstanding. Principal Balance of this
Note may be prepaid in whole, but not in part ( except as
otherwise expressly provided in paragraph 9 (b) hereof) , on the
first day of any month upon at least thirty (30) days advance
written notice to the Lender (or such lesser period of notice
as the Lender may approve) and upon payment of all accrued
unpaid interest hereon to the date of prepayment, plus the
prepayment prew►ium calculated in accordance
with
para not rah 10
hereof, except that such prepaymentpremium
be
payable if such prepayment occurs after the tenth (10th)
anniversary of the date of this Note. Upon a Determination of
Taxability as described in paragraph 2(a) hereof or upon the
occurrence of certain "Events of Default" under
the
and/or under
Construction Loan Agreement, the Loan Agreement
the Mortgage, and as provided in paragraph 15 hereof, the
Lender may dec'are the Principal Balance and all unpaid accrued
interest on this 'rote to be immediately due and payable ( and
such action being saneti:nes herein referred to as an "accelera-
tion" of this 'rote) , in which event the said prepayment premium
shall also be payable in accordance with paragraph 10 hereof,
except that s.-,ch prepayment premium shall not be payable if
such acceleration occurs after the tenth (10th) anniversary of
the date of this Note.
(b) Upon the occurrence of certain events of
damage, destr actio.^. or condemnation, the City or the Borrower
may, as provided in Article III of the Mortgage and Article 5
.of the Loan A;reenert, apply the net proceeds of any insurance
or condemnation award to the prepayment, in whole or in part,
of the Principal Balance of this Note, in which everit the
prepayment prania-n described in paragraph 10 hereof all be
due and payable, LLnless such prepayment occur ai�thz�ihe tenth
(10th) anniversary of the date of this Not�e*t'
F •:
10. mere shall be due, ,mini $nd�,Ta`�able a he
tune of an prepayment, in who 4� .in Part, :or accq eration of
Y
this Note occurring prior to tYr�etelt , (.i0th)'``anr�,t'>►ersary of
the date of this tiotP, in. -d jtxon to �e amoutiE's otherwise
payable here.-.rider, a.�pPem4un equ_kk p4esent value on the
date of prepaay:.ent or acceleratio4 (U6•ing the Treasury Rate, as
hereinafter =efVhed, "pal,culated iai-`Of the date of prepayment or
acceleration as the di:scouriV4 tor) of the stream of monthly
paynentq % - -;oant" equal tq the product of the Principal
Balance. epai3•l£imes th,-_ fuotient '(as hereinafter defined) and
in numbe'-moo the nirnber of whole months between the date
of prepaymenl�i,pr\acceleration and the Calculation Date as here-
inafter d) with the first such payment payable on the
date of pre tr.;1ent or acceleration. The Treasury Rate means
the yield on United States Treasury Securities (as most
recently pub: ished by the Federal 'Reserve Bank of New York
before the date of prepayment or acceleration) having a
maturity date closest to said Calculation Date. The Quotient
means the result obtained by multiplying (i) the difference
between 13.94% and the Treasury Rate, determined as of the date
of prepayment or acceleration, by (ii) a fraction with a
numerator equal to the nunber of days between the date of
prepayment o: acceleration and said Calculation Date and a
dencxninator equal to 360 times the number of whole months
between the date of prepayment or Acceleration and said
Calculation Date. For the purposes of this Note, the Calcu-
lation Date shall mean December 31, 1994. Examples of how this
formula is applied and the calculation of this prepayment
premium is made are set forth in Exhibit A attached to this
Note and hereby :rade a part of this Note.
l ,'
11. All payments under this Note, whether regularly
scheduled payments or prepayments, shall be first applied to
any reasonable expenses and disbursements incurred by the
Len,ier in connection with the collection hereof, then to
accrued and unpaid interest, then to applicable prepayment
premiuns and late charges, if any, then to advances made by the
Lender under this Note, the Mortgage, the Loan Agreement or the
Construction Loan Agreement, and thereafter to the installments
of principal in the inverse order of their maturity. The
payments Niue under paragraph 1 hereof shall continue to be due
and payable in full until the Principal Balance and all unpaid
accrued interest due on this Note have been paid, regardless of
any partial prepayment made hereunder.
12. As provided in the Resolution and subject to
certain limitations set forth therein, this Note is my
transferable upon the books of the Note Reg istra,X„ (a$ defined
in the Resolution) , by the Lender in person
b�r_iis gent
duly authorized in writing, at the Lender',O�exper3�.e;;, u n
surrender hereof together with a writteXy iritrumerr d �, ransfer
satisfactory to an authorized offkcer of'.\thQ ate �t gi ar,
duly executed by the Lender or<,his`�dt�ly.':a;thoi zed gent. Upon
such transfer the said authCt r z� dtficL'r,Wil].. a the date of
registration and, the ne;nef:�ar4 ad res 6-f' t;,�e w registered
Lender in the regis'£ratio4 blank �appe`�r 9 `�,elow. The City may
deem and treW.the person n w. s nage the Note is last
registered urn the �ooics th to Registrar with such
registr4 o� ' }otea 0 "A a No ' �s as the absolute owner hereof,
whethe pr notf overdue=` the purpose of receiving payment of
or on tit o*I of a Principal Balance, allesu h, if payments
or interest' `10- all other its order shall be valid and
so made t Lender or upon
effective satisfy and discharge the liability upon the Note
to the extent of the sum or suns so paid, and the City shall
not be affected by any notice to .the contrary.
13. All of the agreements, conditions, covenants,
provisions and stipulations contained in the Resolution,
the
Mortgage, the Loan Agreement, the Pledge 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 vote and interest thereon and any premium
due hereun.ler are payable solely from the revenues and proceeds
derived from the Loan Agreement and the Mortgage and such other
security as the Lender has required pursuant to the
Construction Loan Agreement, and do not constitute a debt of
the City within the meaning of any constitutional or statutory
limitation, are not payable fran or a charge upon any funds
other than the revenues and proceeds pledged to the payment
thereof, ani do not give rise to a pecuniary liability of the
City or, to the extent pennitted by law, of any of its
officers, agents or employees, and no -,:alder of this Note shall
ever have the right to compel any exercise of the taxing power
of the City to pay this Vote or the interest thereon, or to
enforce pay.ent thereof against any proc,;--rty of the City, and
this Note does not constitute a charge, lien or encumbrance,
legal or eliitable, upon any property of the City, and the
agreement of the City to perform or cause the performance of
the covenants and other provisions herein referred to shall be
subject at ail times to the availability of revenues or other
funds furnis'zed for such purpose in accor.3ance with the Loan
'Agreement, s:fficient to pay all costs of such performance or
the enforcement thereof.
15. It is agreed that time is of the essence of this
`rote. If an E✓ent of Default (as that tern is defined the
Mortgage, the Construction Loan Agreement or tate 1AA
Agreement) shall occur, then the Lender shall; e tti ht
and option to declare the entire Princi: a=- Balance h��ed�ft. nd
accrued interest thereon immediately^e hnd pa'yatile,`- d4upon
the same, rnl;:s any late charges a d Firece—rment premi � all
be due and payable. Failure to eQYrci'se such oo�io a any
time shall nol constitute a:waiyer''bf the right exercise the
same at any s,:�sequent �Glme:''• = �j
lo. Th�remed1e�of� a er, as provided herein
and in the% ortgage,.•,the :Loan - - ement, the Pledge Agreement
and the CO,
nst�uctiari Loah\A� e�nent, are not exclusive and
shall be clozu� i� and c Current and ray be pursued singly,
successively �?tob then, at the sole discretion of the Lender,
and may be e`xert�se as often as occasion therefor shalt occur;
and the faila'to exercise any such right or remedy shall in
no event be construed as a waiver Grprelease thereof.
17. Any payment hereunder not made by the City within
twenty (20) days of the due date shall be subject to a late
payment charge equal to 2% of such delinquent payment and shall
be immediately due by the City to the Lender.
18. The Lender shall not be deemed, by any act of
mission or coacnission, to have waived any of its rights or
remedies here=der unless such waiver is in writing and signed
by the Lender 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 reinedy as to a subsequent event.
19. This Note has been issued without registration
under state or federal or other securities laws, pursuant to an
exemption for such issuance; and accordingly the Vote may not
be assigned or transferred in whole or part, nor may a
participation interest in the Note be given pursuant to any
participation agreement, except in accordance with an
applicable exemption from such registration requirements.
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 City has caused this Note to
be duly executed in its name by the manual signatures of the
Mayor Pro Tem and City Manager and has caused th- corporate
seal to be affixed hereto, and has caused this Note to be dated
December 31 , 1984. t
CITY OF ST--d6LO MINNESOTA
y
r yo r Pro Tem
B
�ity Man r �.
4
7
1 1 '
/I
EXHIBIT A
PREPAYMENT PREMIUM EXAMPLES
The prepayment penalty is calculated as follows:
The difference between : (i) 13-94%, and
(ii) The yield as determined on
the prepayment or accelera-
tion date on United States
Treasury Securities having
a maturity closest to
December 31, 1994.
Multiplied by: The rumber�f ys re -
mai: i^g yfrom,tti date of
prepg{-i�ent `t�= eleration
Eo Lz�n er, '
Divided by 'a',� The zu.-rber o �, hole months
�%renai:.i Pam the date of
' 'Pre =4 r►r ��t or acceleration
'k %.t -
to i_"cember 31, 1994, times
The Je-sirl-t {G:. this 'Calculan is called the "Quotient."
The amount`�oA4.he prepayment premium is the present value on
the dag prepayment or acceleration (using as the discount
factor the Treasury Rate on the prepayment or acceleration
date, which Treasury Rate is the yield on United States
Treasury Securities having a maturity date closest to
December 31, 1994) of a stream of equal monthly payments in
number equal to the number of whole months remaining to
December 31, 1994, with the amount of each hypothetical monthly
payment equal to the Quotient times the principal amount
prepaid or accelerated and with the first payment payable on
the date of prepayment or acceleration.
Example:
Assume:
Prepayment or acceleration five (5) years prior to
December 31, 1994.
Amount prepaid = $500,000
Case I -
Treasury Rate on date of prepayment or acceleration on
five year securities (five years prior to December 31,
1994) is greater than or equal to 13.94%.
Prepayment Premium: None
Case II -
Treasury Rate on date of prepayment or acceleration on
five year securities (five years prior to December 31,
1994) = 13%
Difference 360 t•�.':!
Amount In Interest No. of DLLs 40f Mg1�t
$5n0, 000 X 4.1394 - .1300) x ( 365 ) i'r ` 3¢Q3� ( S x 'r = $397.11
Present value of, a molt-thly annuitX able,iri�dvance) of
$397.11 for 69; -month dis anted ` t 1� .6.6 {'1.083$ per month)
$171T45,3,0-3--4
Prepat Pr7s, 3.
*to December 31, 1994
C'
i
PROVISIONS AS TO REGISTRATION
The ownership of the unpaid Principal Balance of this
Note and the interest accruing thereon is registered on the
books of the Note Registrar in the name of the holder last
noted below.
Signature of
an authorized
Date of Name and address officer of Note
Registration Registered Owner Registrar
The First National !
Bank of Saint Paul ,
332 Minnesota Street K'
December3/, 1984 St. Paul, Mn. 55101
tel
1
1 ,
i