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HomeMy WebLinkAboutResolution 82-08Resolution No. 82 - 08
RESOLUTION RELATING TO A $810,000
COMMERCIAL DEVELOPMENT REVENUE NOTE;
AUTHORIZING THE ISSUANCE THEREOF
PURSUANT TO MINNESOTA STATUTES, CHAPTER
474
BE IT RESOLVED by the City Council of the City of
Columbia Heights, Minnesota, as follows:
Section 1. Definitions.
1.0i. In this Resolution the following terms
have the following respective meanings unless the context
hereof or use herein clearly requires otherwise:
Act: the Minnesota Municipal Industrial
Development Act, Minnesota Statutes, Chapter 474, as
amended;
Assignment: the Assignment of Rents and Leases
to be given by the Borrower to the Lender;
Borrower: Ruvelson & Associates, Incorporated, a
Minnesota corporation, its successors and assigns;
City: the City of Columbia Heights, Minnesota,
its successors and assigns;
Guarantor: James J. Ruvelson, an individual
residing in the State of Minnesota;
Guaranty: the Guaranty to be given by the
Guarantor to the Lender;
Holder: any holder of the Note;
Improvements: the approximately 20,160-square
foot office building and related facilities and
improvements which have been acquired and constructed
on the Land by the Borrower;
~and: the real estate located in the County of
Anoka, State of Minnesota, and legally described in
Exhibit A to the Mortgage;
Lender: Unionmutual Stock Life Insurance Co. of
America, a Maine corporation, its successors and
assigns;
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Loan Agreement: the Loan Agreement to be entered
into between the City and the Borrower;
Mortgage: the Mortgage and Security Agreement
and Fixture Financing Statement to be entered into
between the Borrowerf as mortgagor, and the Lender, as
mortgagee;
Note: the $810,000 Commercial Development
Revenue Note (Ruvelson & Associates, Incorporated
Project) to be issued by the City pursuant to this
Resolution;
Organizational Documents: the following
documents, each of which shall be in form and
substance acceptable to the Lender:
(±)
A copy of the Articles of Incorporation of
the Borrower, and a Certificate of Good
Standing of the Borrower, both certified to
by the Secretary of State of the State of
Minnesota.
(ii)
(iii)
A copy of the Bylaws of the Borrower,
certified by the Secretary of Borrower.
A copy of corporate resolutions adopted by
the Directors of the Borrower, and certified
to by the Secretary of the Borrower~
authorizing the execution, delivery and
perfomance of the documents referred to in
Section 3.03 hereof.
(iv)
An opinion or opinions of counsel reasonably
acceptable to the Lender indicating that
each of the documents referred to in Section
3.03 of this Resolution have been duly
executed and delivered and are legal and
binding obligations of the Borrower, the
Guarantor and the City, as the case may be,
enforceable in accordance with their terms.
Pledge Agreement: the Pledge Agreement to be
given by the City to the Lender;
Prior Issue: the $775,000 City of Columbia
Heights, Minnesota Commercial Development Revenue Note
(Ruveison & Associates, Incorporated Project), Series
1981;
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Project: the Land and the Improvements, as they
may at any time exist;
pro~ect costs: those costs defined as Project
Costs in Section !.01 of the Loan Agreement; and
Resolution: this resolution of the City.
Section 2.
declared that:
Findinss.
It is hereby found and
(a) based upon representations made to the City
by representatives of the Borrower as to the nature of
the Project, the real property and improvements
described in the Loan Agreement and the Mortgage
comprising the Project constitute a project authorized
by the Act;
(b) the purpose of the Project is, and the
effect thereof will be, to promote the public welfare
by the attraction, encouragement and development of
economically sound industry and commerce so as to
prevent the emergence of or to rehabilitate, so far as
possible, blighted and marginal lands and areas of
chronic unemptoyment~ the retention of industry to use
the available resources of the community in order to
retain the benefit of its existing investment in
educational and public service facilities; halting the
movement of talented, educated personnel of mature age
to other areas and thus preserving the economic and
human resources needed as a base for providing
governmental services and facilities; and more
intensive development of land available in the
community to provide an adequate and better balanced
tax base to finance the increase in the amount and
cost of governmental services;
(c) the Improvements add to the tax base of the
City, and accordingly are of direct benefit to the
taxpayers of the City;
(d) the Project has been approved by the
Commissioner of Securities and Real Estate of the
State of Minnesota;
(e) the financing of the acquisition and
construction of the Project, payment of the
outstanding principal amount of the Prior Issue, the
issuance and sale of the Note, the execution and
delivery of the Loan Agreement and the Pledge
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Agreement, and the performance of all covenants and
agreements of the City contained in the Note, the Loan
Agreement and the Pledge Agreement and of all other
acts and things required under the Constitution and
laws of the State of Minnesota to make the Note, the
Loan Agreement and the Pledge Agreement valid and
binding obligations of the City in accordance with
their terms, are authorized by the Act;
(f) it is desirable that the Note in the amount
of $810,000 be issued by the City upon the terms set
forth herein, and that the City pledge its interest in
the Loan Agreement and grant a security interest
therein to the Lender as security for the payment of
the principal of, premium and late charges, if any,
and interest on the Note~
(g) the loan payments contained in the Loan
Agreement are fixed, and required to be revised from
time to time as necessary, so as to produce income and
revenue sufficient to provide for prompt payment of
principal of, premium and late charges, if any, and
interest on the Note when due, and the Loan Agreement
also provides that the Borrower is required to pay all
expenses of the operation and maintenance of the
Project, including, but without limitation, adequate
insurance thereon and all taxes and special
assessments levied upon or with respect to the Project
and payable during the term of the Loan Agreement;
(h) under the provisions of Minnesota Statutes,
Section 474.10, the Note is not to be payable from nor
charged upon any funds of the City other than the
revenue pledged to the payment thereof; the City is
not subject to any liability thereon~ no Holder of the
Note shall ever have the right to compel any exercise
of the taxing power of the City to pay the Note or the
interest thereon, nor to enforce payment thereof
against any property of the City other than those
rights and interests of the City under the Loan
Agreement which have been pledged to the Lender by the
Pledge Agreement; the Note shall not constitute a
charge, lien or encumbrance, legal or equitable, upon
any property of the City other than those rights and
interests of the City under the Loan Agreement which
have been pledged to the Lender by the Pledge
Agreement; and the Note shall recite that the No~:e,
including interest thereon, is payable solely from the
revenue pledged to the payment thereof and shall not
constitute a debt of the City within the meaning of
any constitutional or statutory limitation; and
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(i) payment of the outstanding principal amount
of the Prior Issue with the proceeds of the Note is
authorized by the Act.
Section 3. Authorization and Sale.
3.01. Authorization. The City is authorized by
the Act to issue revenue bonds and loan the proceeds
thereof to business enterprises to finance the acquisition
and construction of "projects", as defined in the Act, and
to make all contracts, execute all instruments and do all
things necessary or convenient in the exercise of such
authority, and to pay the principal amount of temporary
bonds issued to finance such projects pursuant to
Minnesota Statutes ~474.07.
3.02. Preliminary City Approval. By preliminary
ordinance duly adopted by the Council on September $,
1950~ after a public hearing held on that date, this
Council approved the sale of a revenue obligation pursuant
to the Act and the loan of the proceeds to the Borrower
for the acquisition and construction of the Project
suitable and designed for use as an office building and
authorized the preparation of such documents as may be
appropriate to the Project.
3.03. Approval of Documents. Pursuant to the
foregoing, there have been prepared and presented to the
Council copies of the following documents, all of which
are now, or shall be, placed on file in the office of the
City Clerk:
(a) Assignment;
(b) Guaranty;
(c) Loan Agreement;
(d} Mortgage; and
(e) Pledge Agreement.
The forms of the documents listed in (a) through (e) above
are approved, in substantially the form of the documents
as are now on file and before the Council on the date
hereof.
Section 4. Authorizations. Upon the completion
of the Loan Agreement and the Pledge Agreement approved in
Section 3.03 hereof and the execution thereof by the
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Borrower and the Lender, as the case may be, the Mayor and
the City Manager shall execute the same on behalf of the
City and shall execute the Note in substantially the form
approved in paragraph 5.01 hereof on behalf of the City,
and shall affix thereto the corporate seal of the City,
and shall execute such other certifications, documents or
instruments as bond counsel or counsel for the Lender
shall require, subject to the approval of the City
Attorney, and all certifications, recitals and
representations therein shall constitute the
certifications, recitals and representations of the City.
Execution of any instrument or document by one or more
appropriate officers of the City shall constitute, and
shall be deemed the conclusive evidence of, the approval
and authorization by the City and the Council of the
instrument or document so executed.
Section 5. The Note.
5.01. Form and Authorized Amount. The Note
shall be issued substantially in the form presented to the
Council and set forth as Exhibit A to this Resolution with
such appropriate variations, omissions and insertions as
are permitted or required by this Resolution, in the total
principal amount of $810,000. The terms of the Note are
set forth therein, and such terms, including but not
limited to provisions as to interest rate, dates and
amount of payment of principal and interest and prepayment
privileges, are incorporated by reference herein.
5.02. Execution. The Note shall be executed on
behalf of the City by the signatures of the Mayor and the
City Manager and shall be sealed with its corporate seal.
In case any officer whose signature shall appear on the
Note shall cease to be such officer before the delivery
thereof, such signature shall nevertheless be valid and
sufficient for all purposes.
5.03. Mutilated, Lost and Destroyed Note. In
case the Note shall become mutilated or be destroyed or
lost, the City shall cause to be executed and delivered a
new Note of like outstanding principal amount and tenor in
exchange and substitution for and upon cancellation of the
mutilated Note, or in lieu of and in substitution for such
Note destroyed or lost, upon the Holder's paying the
reasonable expenses and charges of the City in connection
therewith, and, in case the Note is destroyed or lost, its
filing with the City evidence satisfactory to the City of
such loss or destruction.
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5.04. ~egistration. The Note shall be
registered on the books of the City, subject to the
conditions set forth in the form of the Note attached
hereto as Exhibit A.
5.05. Delivery and Use of Proceeds. Prior to
delivery of the Note, the documents referred to in Section
3.03 hereof shall be completed and executed in form and
substance as approved by the City Attorney and an
original, executed counterpart of each such document shall
be delivered to the Lender, together with the
Organizational Documents. The City shall thereupon
deliver to the Lender the Note in the total principal
amount of $810~000, together with a copy, duly certified
by the City Clerk, of this Resolution and such closing
certificates as are required by bond counsel.
Upon delivery of the Note and the above items to
the Lender, the Lender shall, on behalf of the City,
disburse the proceeds of the Note to the Borrower in
reimbursement of, or to its order for payment of, Project
Costs pursuant to the provisions of the Loan Agreement.
The Borrower shall provide the City with a full accounting
of all funds disbursed for Project Costs.
Section 6. Limitations of the City's
Obligations. Notwithstanding anything contained in the
Note, the Loan Agreement or the Pledge Agreement or any
other documents referred to in Section 3.03 hereof, the
Note shall not constitute a debt of the City within the
meaning of any constitutional or statutory limitation, and
shall not be payable from nor charged upon any funds other
than the revenue pledged to the payment thereof, and the
City shall not be subject to any liability thereon, and no
Holder of the Note shall ever have the right to compel any
exercise of the taxing power of the City to pay the Note
or the interest thereon~ or to enforce payment thereof
against any property of the City other than those rights
and interests of the City under the Loan Agreement which
have been pledged to the Lender by the Pledge Agreement,
and the Note shall not constitute a charge, lien or
encumbrance, legal or equitable, upon any property of the
City other than those rights and interests of the City
under the Loan Agreement which have been pledged to the
Lender by the Pledge Agreement. The agreement of the City
to perform the covenants and other provisions contained in
this Resolution or the Note, the Loan Agreement or the
Pledge Agreement and the other documents listed in Section
3.03 hereof shall be subject at all times to the
availability of revenues furnished by the Borrower
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sufficient to pay all costs of such performance or the
enforcement thereof, and the City shall not be subject to
any personal or pecuniary liability thereon other than as
stated above.
Adopted: February 22, 198~-~
.
/./Secretary to the Council
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The motion for the adoption of the foregoing
resolution was offered by Member Norber,q ,
and was duly seconded by Member Hent§es , and, upon
vote being taken thereon~ the following voted in favor
thereof: Hovland, Pe~koff. Norberg, Hentges, Nawrocki
and the following voted against the same:
None
whereupon said resolution was declared duly passed and
adopted and was signed by the Mayor which was attested by
the Secretary of the Council.
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