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HomeMy WebLinkAbout08-11 - ADMIN Resolution - Economic Development Authority - 2008/10/06AUTHORIZING RESOLUTION EDA RESOLUTION NO. 08-11 RESOLUTION APPROVING THIRD AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT AND AWARDING THE SALE OF, AND PROVIDING THE FORM, TERMS, COVENANTS AND DIRECTIONS FOR THE ISSUANCE OF ITS ADDITIONAL TAX INCREMENT REVENUE NOTES TO HIGHWAY 7 BUSINESS CENTER LLC BE IT RESOLVED BY the Board of Commissioners ("Board") of the St. Louis Park Economic Development Authority, St. Louis Park, Minnesota (the "Authority") as follows: Section 1. Authorization: Award of Sale. 1.01. Authorization. The Authority and the City of St. Louis Park ("City") have heretofore approved the establishment of its Highway 7 Corporate Center Tax Increment Financing District. (the "TIF District") within Redevelopment Project No. 1 ("Project"), and have adopted a tax increment financing plan for the purpose of financing certain improvements within the Project. The Authority and City have further approved the establishment of a Hazardous Substance Subdistrict (the "Subdistrict") within the TIF District; and have approved that certain Contract for Private Redevelopment between the Authority, the City and Highway 7 Business Center LLC, dated as of June 29, 2006, as amended by the First Amendment thereto dated as of September 18, 2006 and the Second Amendment thereto dated as of November 6, 2006 (together, the "Agreement"). Pursuant to Minnesota Statutes, Section 469.178, the Authority is authorized to issue and sell its bonds for the purpose of financing a portion of the public redevelopment costs of the Project. Such bonds may be payable from all or any portion of revenues derived from the TIP District or Subdistrict or both and pledged to the payment of the bonds. The Authority hereby finds and determines that it is in the best interests of the Authority that it issue and sell its Tax Increment Revenue Notes, Series 2008C and Series 2008D, (the "Notes") for the purpose of financing certain public redevelopment costs of the Project. 1.02. Third Amendment Approved; Issuance, Sale, and Terms of the Notes. (a) The Authority hereby approves the Third Amendment to the Agreement (the "Third Amendment"), and authorizes the President and Executive Director to execute such Third Amendment in substantially the form on file with the Authority, subject to modifications that do not alter the substance of the transaction and are approved by such officials, provided that execution of the Amendment by such officials is conclusive evidence of their approval. The Authority further authorizes the President and Executive Director to issue the Notes in accordance with the Third Amendment. All capitalized terms in this resolution have the meaning provided in the Agreement and Third Amendment unless the context requires otherwise. EDA Resolution No. 08-11 -2- (b) The Notes shall he issued in the aggregate principal amount of $95,000 to Highway 7 Business Center LLC (the "Owner"), in consideration of certain eligible costs incurred by the Owner under the Third Amendment and Agreement, shall be dated the date of delivery thereof, and shall bear interest from the date of issue to the earlier of maturity or prepayment, at the rate of 1.0%. The Notes will be issued in two series: (i) Series 2008C (such year to be the year of issue; hereafter the "Series 2008C Note"), issued in the principal amount of $72,000; and (ii) Series 2008D (such year to be the year of issue; hereafter the "Series 2008D Note"), issued in the principal amount of $23,000. The Series 2008C Note is secured by Available Subdistrict Increment together with Available Redevelopment Increment; and the Series 2008D Note is secured solely by Available Redevelopment Increment, all as further described in the form of the Note herein. Authority hereby delegates to the Executive Director the determination of the date on which the Notes are to be delivered, in accordance with the Agreement. Section 2. Form of Notes. The Notes shall be in substantially the following form: EDA Resolution No. 08-11 -3- No. R-1 UNITED STATE OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN ST. LOUIS PARK ECONOMIC DEVELOPMENT AUTHORITY TAX INCREMENT REVENUE NOTE SERIES 2008_ Date Rate of Original Issue 1.0% The St. Louis Park Economic Development Authority ("Authority") for value received, certifies that it is indebted and hereby promises to pay to Highway 7 Business Center LLC or registered assigns (the "Owner"), the principal sum of $ and to pay interest thereon at the rate of 1.0% per annum, but solely from the sources and to the extent set forth herein. This Note is issued pursuant to the Contract for Private Redevelopment between the Authority, the City of St. Louis Park, and the Owner, dated as of June 29, 2006, as amended by that First Amendment thereto dated as of September 18, 2006, that Second Amendment thereto dated as of November 6, 2006, and that Third Amendment thereto dated as of October 6, 2008 (the "Agreement'), and capitalized terms herein have the meaning provided in the Agreement unless the context clearly requires otherwise. 1. Payments. Principal and interest ("Payments") shall be paid on August 1, 2009 and each February 1 and August 1 thereafter to and including August 1, 2027 ("Payment Dates") in the amounts and from the sources set forth in Section 3 herein. Payments shall be applied first to accrued interest, and then to unpaid principal. Interest accruing from the date of issue through and including February 1, 2009 shall be compounded semiannually on February 1 and August 1 of each year and added to principal. 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 Authority. Payments on this Note are payable in any coin or currency of the United States of America which, on the Payment Date, is legal tender for the payment of public and private debts. 2. Interest. Interest at the rate stated herein shall accrue on the unpaid principal, commencing on the date of original issue. Interest shall be computed on the basis of a year of 360 days and charged for actual days principal is unpaid. EDA Resolution No. 08-11 -4- 3. [Series C Note: Insert the following] Available Tax Increment. Payments on this Note are payable on each Payment Date solely from and in the amount of, and in the following order of priority: (a) "Available Redevelopment Increment," which shall mean 95% of the Tax Increment attributable to the Redevelopment Property (excluding any portion thereof attributable to the Subdistrict) that is paid to the Authority by Hennepin County in the six months preceding each Payment Date on the Note and remains on hand after payment or provision for payment on such Payment Date of the principal and interest then due on the Authority's $2,100,000 Tax Increment Revenue Note, Series 2008A dated July 24, 2008 ("Series 2008A Note") and the Authority's $360,000 Tax Increment Revenue Note, Series 2008B dated July 24, 2008 ("Series 2008B Note"); provided, however, Available Redevelopment Increment is allocated on each Payment Date to this Note and the Authority's Tax Increment Revenue Note, Series 2008D, pro rata based on the outstanding principal balance of such notes as of the Payment Date; and (b) "Available Subdistrict Increment," which shall mean 95% of the Tax Increment attributable to the captured net tax capacity of the Redevelopment Property in the Subdistrict, calculated as described in the second sentence of Section 469.174, subd. 4 of the TIF Act, and that is paid to the Authority by Hennepin County in the six months preceding each Payment Date on the Note and remains on hand after payment or provision for payment on such Payment Date of the principal and interest then due on the Series 2008A Note; and The revenues pledged in paragraphs (a) and (b) are referred to together as "Available Tax Increment." The pledge of Available Tax Increment hereunder is subordinate to the pledge of Available Tax Increment to the Series 2008A Note and Series 2008B as and to the extent described in this section. The Authority shall have no obligation to pay principal of and interest on this Note on each Payment Date from any source other than Available Tax Increment and the failure of the Authority to pay the entire amount of principal or interest on this Note on any Payment Date shall not constitute a default hereunder as long as the Authority pays principal and interest hereon to the extent of Available Tax Increment. The Authority shall have no obligation to pay unpaid balance of principal or accrued interest that may remain after the final Payment on August 1, 2027, except from Available Tax Increment attributable to property taxes paid in 2027 or prior years. [Series D Note: Insert the following:] Available Redevelopment Increment. Payments on this Note are payable on each Payment Date solely from and in the amount of "Available Redevelopment Increment," which shall mean 95% of the Tax Increment attributable to the Redevelopment Property (excluding any portion thereof attributable to the Subdistrict) that is paid to the Authority by Hennepin County in the six months preceding each Payment Date on the Note and remains on hand after payment or provision for payment on such Payment Date of the principal and interest then due on the Authority's $2,100,000 Tax Increment Revenue Note, Series 2008A dated July 24, 2008 ("Series 2008A Note") and the Authority's $360,000 Tax Increment Revenue Note, Series 2008B dated July 24, 2008 ("Series 2008B Note"); provided, however, Available Redevelopment Increment is allocated on each Payment Date to EDA Resolution No. 08-11 -5- this Note and the Authority's Tax Increment Revenue Note, Series 2008C, pro rata based on the outstanding principal balance of such notes as of the Payment Date. The pledge of Available Redevelopment Increment hereunder is subordinate to the pledge of Available Redevelopment Increment to the Series 2008A Note and Series 2008B Note as and to the extent described in this paragraph The Authority shall have no obligation to pay principal of and interest on this Note on each Payment Date from any source other than Available Redevelopment Increment and the failure of the Authority to pay the entire amount of principal or interest on this Note on any Payment Date shall not constitute a default hereunder as long as the Authority pays principal and interest hereon to the extent of Available Redevelopment Increment. The Authority shall have no obligation to pay unpaid balance of principal or accrued interest that may remain after the final Payment on August 1, 2027, except from Available Redevelopment Increment attributable to property taxes paid in 2027 or prior years. 4. Default. Upon an Event of Default by the Redeveloper under the Agreement, the Authority may exercise the remedies with respect to this Note described in Section 9.2 of the Agreement, the terms of which are incorporated herein by reference. 5. Optional Prepayment. The principal sum and all accrued interest payable under this Note is prepayable in whole or in part at any time by the Authority 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. 6. Nature of Obligation. This Note is one of an issue in the total principal amount of $95,000 issued to aid in financing certain public development costs and administrative costs of a Project undertaken by the Authority pursuant to Minnesota Statutes, Sections 469.001 through 469.047, and is issued pursuant to an authorizing resolution (the "Resolution") duly adopted by the Authority on October 6, 2008, 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 Authority which is payable solely from Available Tax Increment [Available Redevelopment Increment] pledged to the payment hereof under the Resolution. This Note and the interest hereon shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, the Authority. Neither the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of or interest on this Note or other costs incident hereto except out of Available Tax Increment [Available Redevelopment Increment], 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 the principal of or interest on this Note or other costs incident hereto. 7. Registration and Transfer. 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 upon the books of the Authority kept for that purpose at the principal office of the City Finance Director, by the Owner hereof in person or by such Owner's attorney duly authorized in writing, upon surrender of this Note together with a written instrument of transfer satisfactory to the Authority, duly executed by the Owner. Upon such transfer or exchange and the payment by the EDA Resolution No. 08-11 -6- Owner of any tax, fee, or governmental charge required to be paid by the Authority 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, bearing interest at the same rate and maturing on the same dates. This Note shall not be transferred to any person (except to the extent permitted under the Resolution or the Agreement) unless the Authority has been provided with an opinion of counsel or a certificate of the transferor, in a form satisfactory to the Authority, that such transfer is exempt from registration and prospectus delivery requirements of federal and applicable state securities laws. 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 Authority according to its terms, have been done, do exist, have happened, and have been performed in due form, time and manner as so required. IN WITNESS WHEREOF, the Board of Commissioners of the St. Louis Park Economic Development Authority has caused this Note to be executed with the manual signatures of its President and ExecuAve Director, all as of the Date of Original Issue specified above. ST. LOUIS PARK ECONOMIC DEVELOPMENT AUTHORITY REGISTRATION PROVISIONS The ownership of the unpaid balance of the within Note is registered in the bond register of the City Finance Director, in the name of the person last listed below. Date of Signature of Registration Registered Owner City Finance Director Highway 7 Business Center LLC Federal Tax I.D. No. 20-3416748 EDA Resolution No. 08-11 -7- Section 3. Terms, Execution and Delivery. 3.01. Denomination, Payment. The Notes shall be issued as single typewritten notes numbered R-1. The Notes shall be issuable only in fully registered form. Principal of and interest on the Notes shall be payable by check or draft issued by the Registrar described herein. 3.02. Dates; Interest 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 Authority hereby appoints the City Finance Director to perform the functions of registrar, transfer agent and paying agent (the "Registrar"). The effect of registration and the rights and duties of the Authority 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 a 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 of a like aggregate principal amount and maturity, as requested by the transferor. Notwithstanding the foregoing, the Notes shall not be transferred to any person (other than an affiliate, or other related entity, of the Owner, or to a lender as security for financing necessary to construct the Minimum Improvements as defined in the Agreement) unless the Authority has been provided with an opinion of counsel or a certificate of the transferor, in a form satisfactory to the Authority, 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. The Note surrendered upon any transfer shall be promptly cancelled by the Registrar and thereafter disposed of as directed by the Authority. (d) Improper or Unauthorized Transfer. When a 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. EDA Resolution No. 08-11 -8- (e) Persons Deemed Owners. The Authority and the Registrar may treat the person in whose name the Notes are at any time registered in the bond register as the absolute owner 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 such Notes and for all other purposes, and all such payments so made to any such registered owner or upon the owner's order shall be valid and effectual to satisfy and discharge the liability of the Authority upon such Notes to the extent of the sum or sums so paid. (f) Taxes, Fees and Cha%es. For every transfer or exchange of the Notes, 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 Note. 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 Authority 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 Authority. 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. 3.04. Preparation and Delivery. The Notes shall be prepared under the direction of the Executive Director and shall be executed on behalf of the Authority by the signatures of its President and Executive Director. 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 Note have been so executed, they shall be delivered by the Executive Director to the Owner thereof in accordance with the Agreement. Section 4. Securi1y Provisions. 4.01. Pledee. The Authority hereby pledges to the payment of the principal of and interest on the Notes all Available Subdistrict Increment and/or Available Redevelopment Increment, as defined in, and subject to the terms described in, the Notes. Available Subdistrict Increment and Available Redevelopment Increment shall be applied to payment of the principal of and interest on the Notes in accordance with the terms of the form of Notes set forth in Section 2 of this resolution. 4.02. Bond Fund. Until the date the Notes are no longer outstanding and no principal thereof or interest thereon (to the extent required to be paid pursuant to this resolution) remains unpaid, the Authority shall maintain a separate and special "Bond Fund" to be used for no purpose other than the payment of the principal of and interest on the Notes. The Authority irrevocably agrees to appropriate to the Bond Fund in each year Available Subdistrict Increment and Available EDA Resolution No. 08-11 -9- Redevelopment Increment. Any Available Subdistrict Increment and Available Redevelopment ( Increment remaining in the Bond Fund shall be transferred to the Authority's account for the TIF \ District upon the termination of the Note in accordance with its terms. 4.03. Additional Obligations. (a) The Authority will issue no obligations secured by Available Subdistrict Increment unless such pledge is on a subordinate basis to the pledge to the Series 2008A Note and Series 2008C Note. (b) As described in the form of the Notes, Available Redevelopment Increment is pledged to the Series 2008C Note and the Series 2008D Note on a parity basis, subordinate to the pledge to the Series 2008A and Series 2008B Notes. The Authority will issue no other obligations secured in whole or in part with Available Redevelopment Increment unless such pledge is on a subordinate basis to the pledge to the Series 2008A and Series 2008B Notes, and to the Series 2008C and Series 2008D Notes. Section 5. Certification of Proceedines. The officers of the Authority are hereby authorized and directed to prepare and furnish to the Owner of the Notes certified copies of all proceedings and records of the Authority, 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 Authority as to the facts recited therein. Section 6. Effective Date. This resolution shall be effective upon full execution of the Third Amendment. Attest Adopted by the Economic Development Authority October 6, 2008 —P J -4i President