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RES 1980-109 - 00006594174 RESOLUTION NO. 109 - 1980 A RESOLUTION PROVIDING FOR THE SALE AND ISSUANCE OF INDUSTRIAL DEVELOPMENT REVENUE BONDS UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT TO FINANCE A PROJECT THEREUNDER, SECURED BY PAY- MENTS TO BE RECEIVED PURSUANT TO A LOAN AGREEMENT AND A PLEDGE AND ASSIGNMENT OF THE CITY'S INTEREST IN THE LOAN AGREEMENT AND PAYMENTS THEREUNDER TO A TRUSTEE, AND AUTHORIZING THE EXECUTION OF DOCUMENTS (FARMERS UNION GRAIN TERMINAL ASSOCIATION) BE IT RESOLVED by the City Council of the City of Fridley, Minnesota (the ' "City "), as follows: SECTION 1. AUTHORIZATION AND RECITALS 1.01. General Authority The City is, authorized by Minnesota Statutes, Chapter 474, as amended (the "Act "), to issue and sell its revenue bonds and to make secured or unsecured loans to finance the acquisition of real property and the acquisition or construction of buildings and improvements on such real property and the installation of machinery and equipment of any and all kinds and any other personal properties deemed necessary in connection with a project, as defined in the Act. 1.02. Proposed Project and Bonds Representatives of Dain Bosworth Incorporated (the Underwriter) and Farmers Union Grain Terminal Association (the Company), a Minnesota cooperative corporation, have proposed that the City, acting under and pursuant to the Act, issue and sell its $6,000,000 Industrial Development Revenue Bonds (Farmers Union Grain Terminal Association Project), Series 1980 (the Bonds), for the purpose of defraying the costs of constructing improvements to certain real property and installing thereon and therein items of machinery, equipment and other personal property (the Project) suitable and to be used ' in conjunction with the existing facilities of the Company, as a facility for the processing of agricultural and food products. Pursuant to the proposal the proceeds of the Bonds will be loaned by the City to the Company and the Company agrees to make payments sufficient to pay the principal of and interest on the Bonds. The City will assign its interest in the Loan Agreement (as hereinafter defined) to a Trustee (as hereinafter defined). 1.03. Prior Approval On February 26, 1979, this Council adopted a resolution giving preliminary approval to the Project and authorizing preparation of necessary documents. 1.04. Project Cost The Company and the Underwriter have advised this Council and this Council hereby finds that the estimated costs of the Project at the present time are approximately as follows: Building Construction 644,000 Machinery and Equipment 4,550,357 Engineering 500,000 Legal and Underwriting 162,000 Contingency 143,143 Total $6,000,000 , All costs of the Project in excess of the proceeds of the Bonds available therefor are required to be paid by the Company. 1.05. Documentation Forms of the following documents relating to the Project have been prepared and submitted to this Council and are hereby directed to be filed with the City Manager: A. A Loan Agreement (the Loan Agreement), dated as of October 1, 1980, proposed to be made and entered into between the City and the Company pursuant to which the City loans the proceeds of the Bonds to the Company; 175 Page 2 -- RESOLUTION NO. 105 1980 B. An Indenture of Trust (the Indenture), dated as of October 1, 1980, proposed to be made and entered into between the City and the First Trust Company of Saint Paul, in St. Paul, Minnesota (the Trustee), creating and authorizing the issuance and establishing the terms and conditions of the Bonds; C. A Bond Purchase Agreement (the Bond Purchase Agreement) proposed to be executed by the Company, the City and the Underwriter, pursuant to which the Underwriter agrees to purchase the Bonds; and D. A Preliminary Official Statement (the Preliminary Official Statement), dated as of October 2, 1980, whereby the Underwriter offers the Bonds for sale. SECTION 2. FINDINGS It is hereby found, determined and declared that: A. The Project, as defined herein and in the Loan Agreement, constitutes a project authorized by Section 474.02, Subdivision 1, of the Act; B. The purpose of the Project is and the effect thereof will be to promote the public welfare by encouraging the location and development of economically sound industry and commerce within the City so as to prevent, so far as possible, the emergence of blighted and marginal lands and areas of chronic unemployment; by promotion the use of available resources of the community thereby retaining the benefit of its existing investment in educational and public service facilities, by discouraging the movement of talented, educated personnel of mature age to other areas, thus preserving the economic and human resources needed as a base for providing governmental services and facilities; and by encouraging more intensive development of land available in the City to provide an adequate and better balanced tax base to finance the increase in the amount and cost of governmental services; C. The Project is to be located within the City limits, at a site which is readibly accessible to employees residing within the City and the surrounding community; D. The Project when completed will add to the tax base of the City and overlapping taxing jurisdictions; E. 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; F. The financing of the Project, the issuance and sale of the Bonds in the principal amount of $6,000,000, the execution and delivery of the Loan Agreement, the Indenture and the Bond Purchase Agreement and the performance of all covenants and agreements of the City contained in the Loan Agreement, the Indenture and the Bond Purchase Agreement and of all other acts and things required under the Constitution and laws of the State of Minnesota to make the Loan Agreement, the Indenture, the Bond Purchase Agreement and the Bonds valid and binding obligations in accordance with their terms, are authorized by the Act; G. It is desirable that the Bonds in the amount of $6,000,000 be issued by the City upon the terms set forth in the Indenture, under the provisions of which the City's interest in the Loan Agreement and the payments thereunder will be pledged to the Trustee as security for the payment of the principal, premium, if any, and interest on the Bonds; H. The loan payments contained in the Loan Agreement are fixed, and are 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 and interest on all Bonds issued under the Indenture when due; and the Loan Agreement also provides that the Company is required to pay all 176 Page 3 -- RESOLUTION NO. 109 - 1980 expenses of the operation and maintenance of the Project, including, but without limitation, adequate insurance thereon and insurance against all liability for injury to persons or property arising from the operation thereof, and all taxes and special assessments levied upon or with respect to the Project site and payable during the term of the Loan Agreement; and I. Under the provisions of Section 474.10 of the Act and as provided in the Loan Agreement and the Indenture, the Bonds are 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 and no holders of the Bonds shall ever have the right to compel any exercise of the taxing powers 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 except its interest in the Loan Agreement; each Bond issued under the Indenture shall recite that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment thereof; and no Bond shall constitute a debt of the City within the meaning of any constitutional or statutory limitation. SECTION 3. AUTHORIZATION AND APPROVAL OF THE PROJECT, LOAN AGREEMENT, INDENTURE, BOND PURCHASE AGREEMENT AND PRELIMINARY OFFICIAL STATEMENT The City is hereby authorized to provide for the acquisition, construction and equipment of the Project and pledge and assign the revenues therefrom and its interest in the Loan Agreement, all as provided in the Loan Agreement and the Indenture. The form of Loan Agreement, Indenture and Bond Purchase Agreement referred to in Section 1.05 are approved subject to such modifications as are deemed appropriate and approved by the City Attorney, the Mayor and the City Manager, which approval shall be conclusively evidenced by execution of the Loan Agreement, the Indenture, the Bond Purchase Agreement and the Bonds by the Mayor and the City Manager. The Mayor and the City Manager are directed to execute the Loan Agreement upon execution thereof by the Company; the Indenture upon execution thereof by the Trustee; and the Bond Purchase Agreement upon execution thereof by the Underwriter and the Company. Copies of all of the documents shall be delivered, filed and recorded as provided therein. The Mayor and the City Manager are also authorized and directed to execute such other instruments as may be required to give effect to the transaction herein contemplated. The Preliminary Official Statement is hereby approved and the preparation and distribution of a final Official Statement is hereby authorized. SECTION 4. THE BONDS; SALE AND EXECUTION 4.01. Approval of Purchase Price, Interest Rates and Other Matters The purchase price of $5,805,000, the interest rates, maturity dates and redemption features relating to the Bonds set forth in the Indenture presented at this meeting are hereby approved. 4.02. Authorization In anticipation of the collection of revenues of the Project, the City shall proceed forthwith to issue its Bonds dated as of October 1, 1980, in the form and upon the terms set forth in the Indenture and this resolution. 177 Page 4 -- RESOLUTION NO. 109 - 1980 4.03. Execution . The Mayor and the City Manager are hereby authorized and directed to execute the Bonds as prescribed herein and in the Indenture and to deliver them to the Trustee, together with a certified copy of this resolution, the other documents required in the Indenture, and such other certificates, documents and instruments as may be appropriate to effect the transaction herein contemplated. 1 i PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 20TH DAY OF OCTOBER, 1980. MAYOR - WILLIAM J. ATTEST: ACTING CITY CLERK - NASIM M. QURESHI i a I i