HomeMy WebLinkAboutCity Council Resolution 1978-741CITY OF PLYMOUTH
Pursuant to due call and notice thereof, a regular meeting of the City
Council of the City of Plymouth, Minnesota, was hel 6th day of
November , 1978 . The following members were present:
Mayor _ Mor Hunt, ouncilmembers Hoyt, Neils, Seibold and Spaeth
The following members were absent: None
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Councilmember Neils introduced the following Resolution and moved
s adoption:
RESOLUTION NO. 78-741
A RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF REVENUE BONDS PURSUANT
TO CHAPTER 474, MINNESOTA STATUTES, TO PROVIDE FUNDS TO BE -LOANED TO
GARLOCK EQUIPMENT CO. FOR AN INDUSTRIAL DEVELOPMENT PROJECT
BE IT RESOLVED By the City C-incil of the City of Plymnuth, Minnesota,
as follows:
1. Authority. The City is, by the Constitution and Laws of the State
of Minnesota, including Chapter 474, Minnesota Statutes, 35 amended (the "Act")
authorized to issue and sell its revenue bonds for the purpose of financing the
cost of construction of authorized projects, and to enter into contracts necessary
or convenient in the exercise of the powers granted by the Act and to pl�•dge revenues
of the project and otherwise secure the revenue bonds.
Z. Authorization of Series of Bonds. The City Council hereby determines
that it is necessary and expedient to authorize, and the City Council does hereby
authorize, the issuance of revenue bonds of the City in the aggregate principal
amount of One Million One Hundred Fifty Thousand Dollars ($1,150,000) pursuant
to the Act to provide money to be loaned to Garlock Equipment Co., a Minnesota
corporation (the "Company"), to finance costs of constructing an industrial plant
(the "Project Building") to be used by the Company in its business, together with
necessary building service equipment (the "Project Equipment") to be located per-
manently in and become a part of the Project Building or the site thereof (the
"Project Site") and necessary site improvements (the "Project" as more fully
defined in the Loan Agreement hereinafter mentioned). In order to provide Financing
for the Project, the City shall issue and sell its $1,150,000 City of Plymouth
Industrial Development Revenue Bond (Garlock Equipment Co. Project), Series 1978
(the "Bond").
3. Documents Presented. Forms of the following do(.uments relating to
the Bond and the Project have been submitted to and examined Dy the City Council
and are now on file in the office of the City Clerk:
(a) Loan and Purchase Agreement (the "Loan Agreement"), dated as of
October 1, 1978, by and among the City, the Company and the Farmers & Mechanics
Savings Bank of Minneapolis (the "Bank") whereby, among other things,
the City agrees to sell and the Bank agrees to
purchase the Bond, the City agrees to make a loan to
the Company of the proceeds of the sale of the Bond and
the Company covenants to complete the Project and to
pay amounts sufficient to provide for the prompt
payment of the principal of and interest on the Bond;
and
(b) Guaranty Agreement (the "Guaranty Agreement")
dated as of October 1, 1978, between the Bank and the
Company (the "Guarantor") whereby the Company
guarantees the full and prompt payment of installments
of principal of, premium (if any) and interest on the
Bond when due (this document not to be executed by the
City); and
(c) Combination Mortgage and Security Agreement
(the "Mortgage") dated as of October 1, 1978, by and
between the Company and the Bank, whereby the Company
mortgages the Project Site, the Project Building and
the Project Equipment (the "Project Facilities") as
security for the Bond (this document not to be executed
by the City).
(d) Assignment and Pledge Agreement whereby the
City assigns to the Bank all of its interest in the
Loan and Purchase Agreement and Loan Repayments of the
Company thereunder, for the purpose of securing the
Bond. (Attached hereto as Exhibit 2)
4. Findings. It is hereby found, determined and
declared that:
(a) The Project, as described in the Loan Agree-
ment, constitutes a project authorized by and described
in Section 474.02, Subd. 1 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 the
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 adding to the tax base of the City and the County
and School District in which the Project Facilities
will be located.
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(c) The Project has been approved by preliminary
resolution of the Council duly adopted August 14, 1978
and by the Commissioner of Securities of the State of
Minnesota as tending to further the purposes and poli-
cies of the Act.
(d) The issuance and sale of the Bond, the execu-
tion and delivery of the Loan Agreement and the perfor-
mance of all covenants and agreements of the City
contained in the Bond and the Loan Agreement and of all
other acts and things required under the Constitution
and laws of the State of Minnesota to make the Bond and
Loan Agreement 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 Bond or Loan Agree-
ment, or questioning the organization of the City or
its power or authority to issue the Bonds or execute
the Loan Agreement.
(f) The execution, delivery and performance of
the City's obligations under the Bond and the Loan
Agreement have been fully authorized by all requisite
action and do not and will not violate any law, 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 prop-
erty is bound, or be in conflict with, result in a
breach of, or constitute (with due notice or lapse of
time or both) a default under any such indenture,
agreement or other instrument.
(g) The Loan Agreement provides for payments b
the Company to the Holder of the Bond for the account
of the City of such amounts as will be sufficient to
pay the principal of and interest on the Bond when due.
No reserve funds are deemed necessary for this purpose.
The Loan Agreement obligates the Company to provide for
the operation and maintenance of the Project Facilities,
including adequate insurance, taxes and special assess-
ments.
(h) Under the provisions of Section 474.10 of the
Act, and the Bond shall recite that, the Bond is not to
be payable from nor charged upon any funds other than
amounts payable by the Company pursuant to the Loan
Agreement which are pledged to the payment thereof,
payments to be made by the Guarantor under the Guaranty
Agreement and, in event of default, moneys derived from
foreclosure or other enforcement of the Mortgage; the
City is not subject to any liability thereon; no Holder
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of the Bond shall ever have the right to compel the
exercise of the taxing power of the City to pay the
Bond or the interest thereon, nor to enforce payment
thereof against any property of the City; and the Bond
shall not constitute a charge, lien or encumbrance,
legal or equitable, upon any property of the City; and
such Bond does not constitute an indebtedness of the
City within the meaning of any constitutional or statutory
limitation.
(i) No member of the City Council (i) has a
direct or indirect interest in the Project, the Loan
Agreement or Bond, (ii) owns any capital stock of or
other interest in the Project or the Company, (iii) is
an officer or director of the Company, (iv) will be
involved in supervising the completion of the Project
on behalf of the Company, or (v) will receive any
commission, bonus or other remuneration for or in
respect of the Project, the Loan Agreement or the Bond.
5. Approval and Execution of Documents. The form of
Loan Agreement and form of Assignment and Pledge Agreement,
referred to in paragraph 3 is approved. The Loan Agreement shall
be executed in the name and on behalf of the City by the Mayor
and the City Manager upon execution thereof by the Bank and the
Company, 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 Mayor, City Manager and the City Attorney,
which approval shall be conclusively evidenced by the execution
thereof. The Mortgage and Guaranty Agreement may contain such
revisions as may be approved by the parties executing the same.
The Mayor, City Clerk and City Manager are authorized to execute
and deliver, on behalf of the City, such other documents as are
required by the Loan Agreement.
6. Approval of Terms and Sale of Bond. The City shall
proceed forthwith to ssue its City of Plymouth Industrial Develop-
ment Revenue Bond (Garlock Equipment Co. Project), Series 1978 in
the authorized principal amount of $1,150,000 substantially in
the form and containing the provisions set forth in the form of
Bond attached hereto as Exhibit 1, which provisions are hereby
approved and incorporated in this Bond Resolution and made a part
hereof. The terms of the Bond shall be as follows:
Date The Bond shall be dated the
date of delivery thereof.
Interest The Bond shall bear interest
on the principal amount thereof
advanced and unpaid from time
to time at the rate of 8.25%
per annum, provided, however,
that in the event the Bank
shall ever be required by
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final administrative determin-
ation, court order, derision
or statute to include interest
on the Bond in gross income
for federal income tax pur-
poses, the Bond shall bear
interest on the unpaid princi-
pal amount at the rate of
9.75% per a:aum from and after
the first day of the month
following the date from which
the interest on the Bond is
determined to have been tax-
able, interest to maturity
payable December 1, 1978, and
monthly thereafter on the 1st
day of each month.
Maturity ovember 1, 1994, but payable
An installments on December 1,
11978, and monthly thereafter
on the 1st day of each month.
Installments Interest only payable December 1,
1978, and monthly thereafter
to and including November 1,
1979. Principal and interest
payable in 324 installments of
$8,875 each on the 1st day of
each month commencing December 1,
1979, to and including
October 1, 1994, plus a
final installment of $
payable November 1, 1994.
Prepavment The Bond shall be subject to
Privilege prepayment at any time at the
option of the City, at the
request of the Company in
whole or in part as provided
in Section 5.05 of the Loan
Agreement upon sixty (60)
days' prior mailed notice to
the last known Holder at par,
accrued interest plus a premium
of the amount prepaid as
follows:
5% premium if prepaid on or
before November 1, 1989
4 1/2% premium if prepaid
after November 1, 1989, but
before November 1, 1990
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4% premium if prepaid after
November 1, 1990, but before
November 1, 1991
3 1/2% premium if prepaid
after November 1, 1991, but
before November 1, 1992
3% premium if prepaid after
November 1, 1992, but before
November 1, 1993
2 1/2% premium if prepaid
after November 1, 1993, but
before Noveber 1, 1994
Partial prepayments shall be
applied to the principal
installments last to become
due in inverse order of due
date. The Bond is also sub-
ject to optional redemption at
par plus accrued interest in
certain events of damage,
destruction or condemnation of
the Project, change of law, as
a result of a court order or
decree or if the Bank agrees
to finance any future project
to be located on the Project
Site as provided in Section
5.05 of the Loan Agreement.
If a Determination of Taxability
shall be made and the Company
shall elect not to redeem the
Bond, the Bond shall bear
interest on the unpaid princi-
pal amount at the interest
rate of 9.75% per annum from
the date from which the interest
on the Bond is determined to
have been taxable.
A single Bond, substantially in the form of Exibit 1 to this Bond
Resolution, shall be issued and delivered to the Bank in the
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authorized principal amount of $1,150,000 and as authorized by
. the Act, principal of and interest on the Bond shall be payable
at the office of the Bank in Minneapolis, Minnesota. The proposal
of the Bank to purchase such Bond at a price of $1,150,000 (100%
of par value) is hereby found and determined to be reasonable and
is hereby accepted. Pursuant to the Loan Agreement the Bank has
agreed to pay the purchase price of the Bond in installments up
to the authorized principal amount of the Bond to pay Project
Costs, as defined in the Loan Agreement, then due.
7. Execution, Deliver and Endorsement of Bond. The
Bond may be in typewritten or printed form and shall be executed
by the manual signatures of the Mayor and City Manager and the
official seal of the City shall be affixed thereto. When so
prepared and executed, the Bond shall be delivered to the Bank
upon payment of all or part of the purchase price, and upon
receipt of the signed legal opinions of Messrs. Faegre & Benson,
and LeFevere, Lefler, Pearson, O'Brien & Drawz, of Minneapolis,
Minnesota, co -bond counsel, pursuant to the Loan Agreement. At
the time of delivery of the Bond (the "Initial Closing") the
Authorized Company Representative shall endorse and acknowledge
receipt on Annex A to the Bond the part of the total purchase
price paid by the Bank at the Initial Closing and loaned by the
City to the Company pursuant to the Loan Agreement at the Initial
Closing. At each Subsequent Closing, the Authorized Company
Representative shall endorse and acknowledge receipt on Annex A
to the Bond the part of the total purchase price paid by the Bank
at such Subsequent Closing and loaned by the City to the Company
at such Subsequent Closing. The Authorized Municipal Representa-
tive shall endorse and acknowledge payment on Annex A to the Bond
at the Intitial Closing and each Subsequent Closing. The Bond
shall bear interest only on the amount so paid, loaned and endorsed
on Annex A, from time to time, and remaining unpaid. The 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.
8. Registration Records. The City Clerk, as bond
registrar, shall keep a bond register in which the City shall
provide for the registration of the Bond and for transfers of the
Bond. The principal of and interest on the Bond shall be paid to
the Bank for the account of the Holder entitled thereto in Federal
or other immediately available funds. The City Clerk is autho-
rized and directed to deliver a certified copy of this Bond
Resolution to the County Auditor of Hennepin County, together
with such other information as the County Auditor may require,
and obtain the certificate of the County Auditor as to entry of
the Bond on his bond register as required by the Act and Section
475.63, Minnesota Statutes.
9. Mutilated, Lost, Stolen or Destroyed Bond. If the
Bond is mutilated, lost, stolen or destroyed, the City may execute
and deliver to the Holder a new Bond of like amount, date, number
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and tenor as that mutilated, lost, stolen or destroyed; provided
that, in the case of mutilation, the mutilated Bond shall first
be surrendered to the City, and in the case of a lost, stolen or
destroyed Pond, there shall be first furnished to the City and
the Company evidence of such loss, theft or destruction satis-
factory to the City and the Company, together with indemnity
satisfactory to them. The City and Company may charge the Holder
with their reasonable fees and expenses in replacing any muti-
lated, lost, stolen or destroyed Bond.
10. Transfer of Bond: Person Treated as Holder. The
Bond shall be transferable by the Owner on the bond register of
the City, upon presentation of the Bond for notation of such
transfer thereon at the office of the City Clerk, as bond regis-
trar, accompanied by a written instrument of transfer in form
satisfactory to the City Clerk and the City Attorney duly executed
by the Owner or its attorney duly authorized in writing. The
Owner seeking to transfer ownership of the Band shall also give
written notice thereof to the Company. The Bond shall continue
to be subject to successive transfers at the option of the Owner
of the Bond. No service charge shall be made for any such transfer,
but the City Clerk may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection
therewith. The person in whose name the Bond shall be issued or,
if transferred, shall be registered from time to time shall be
deemed and regarded as the absolute Holder thereof for all purposes,
and payment of or on account of the principal of and interest on
the Bond shall be made only to or upon the order of the Holder
thereof, or its attorney duly authorized in writing, and neither
the City, the City Clerk, the Company, nor the Bank shall be
affected by any notice to the contrary. All such payments shall
be valid and effectual to satisfy and discharge the liability
upon the Bond to the extent of the sum or sums so paid. The
Series 1978 Bond shall be initially registered in the name of,the
Bank.
11. Substitute Bond with Adjusted Installment schedule.
If the Company has failed to borrow the full $1,150,000 authorized
Principal amount of the Bond before October 1, 1979, or if the
Company shall prepay a part of the outstanding principal amount
of the Bond at any time, and if in either such case the Company
and the Holder of the Bond shall so request, then the Mayor and
City Manager are authorized to execute and issue a new Bond in
exchange for the outstanding Bond and affix the official seal of
the City thereto. The substitute Bond shall be in the same
principal amount as the unpaid principal amount of the outstand-
ing Bond and shall be in the same form as the outstanding Bond
except as follows: (i) The date shall be the last date to which
interest has been paid. (ii) The schedule of installments of
principal and interest to be paid on the substitute Bond, includ-
ing the amounts and dates of payment, may he adjusted in such
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manner as the Company and the Holder agree to, provided that the
final maturity date shall not be extended beyond November 1,
1994, and that neither the principal amount thereof nor the
interest rate thereon shall be changed without the approval of
the City given by resolution of the City Council. (iii) The form
of Bond may be changed by deleting Annex A and by appropriate
changes in the text of the Bond to delete references to Annex A.
Prior to issuance of any such.substitute Bond, the Company and
the Bank (or the successor Holder of the Bond) shall execute and
deliver an amendment to the Loan Agreement setting forth the form
of substitute Bond, the agreement of the Company to make the loan
repayments as therein set forth, and the agreement of the Holder
to accept the substitute Bond and the loan repayment schedule
therein provided for, and the then Mayor and City Manager are
authorized to execute on behalf of the City an amendment to the
Loan Agreement executed pursuant to this paragraph 11 without
further action or authorization of the City Council.
12. Amendments, Changes and Modifications to Loan
Agreement and Bond Resolution. Except pursuant to paragraph 11
hereof or Section 9.03 of the Loan Agreement, the City shall not
enter into or make any change, modification, alteration or ter-
mination of the Loan Agreement or this Bond Resolution.
13. Pledge to Holders. The City does hereby and by
the Assignment and Pledge Agreement, pledge and assign to the
Bank and its successor Holders of the Bond all interest of the
City in the revenues of the Project and the Project Facilities,
including all Loan Repayments to be made by the Company under the
Loan Agreement, payments to be made under the Guaranty Agreement
and moneys derived from enforcement of the Mortgage. All such
payments to be made under the Guaranty Agreement revenues and
moneys, and all proceeds thereof, and any collections of moneys
by the City in any proceeding for enforcement of the obligations
of the Company under the Loan Agreement shall be received, held
and applied by the City for the benefit of the Holder of the
Bond.
14. Covenants with Holders; Enforceability. All pro-
visions of the Bond and of this Bond Resolution, and all repre-
sentations and undertakings by the City in the Loan Agreement are
hereby declared to be covenants between the City and the Bank and
its successor Holders of the Bond and shall be enforceable by the
Bank or any Holder in a proceeding brought for that purpose.
15. Definitions and Interpretation. Terms not other-
wise defined in this Bond Resolution but defined in the Loan
Agreement shall have the same meanings in this Bond Resolution
and shall be interpreted herein as provided therein. Notices may
be given as provided in Section 9.01 of the Loan Agreement. In
case any provision of this Bond Resolution is for any reason
illegal or invalid or inoperable, such illegality or invalidity
or inoperability shall not affect the remaining provisions of
this Bond Resolution, which shall be construed or enforced as if
such illegal or invalid or inoperable provision were not con-
tained herein.
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16. Election under Internal Revenue Code. The City
hereby elects that the provisions of Section 103(b)(6)(D) of the
Internal Revenue Code of 1954 and Reg. 91.103-10(b)(2)(vi) there-
under, permitting the issuance of tax exempt industrial develop-
ment bonds in amounts up to $5,000,000 under certain conditions,
shall apply to the Bond, and the Mayor and City Manager or either
of them are authorized to execute and file the appropriate form
of election under the Code and Regulations with the Internal
Revenue service.
17. Certifications. The Mayor, City Manager and City
Clerk and other officers of the City are authorized and directed
to prepare and furnish to Messrs. Faegre & Benson and LeFevere,
Lefler, Pearson, O'Brien & Drawz as co -bond counsel, to the
Company, to the Bank and to counsel for the Company and the Bank,
certifies copies of all proceedings and records of the City
relating to the Project and the Bond, 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 representations of the City as to the truth of
all statements contained therein.
The motion for the adoption of the foregoing Resolution was duly seconded by
Councilmember Hoyt, and upon vote being taken thereon, the following voted in
avor thereof: Mayor Hunt, Councilmembers Hoyt, Neils, Seibold and Spaeth.
The following voted against or abstained: None.
Whereupon the Resolution was declared duly passed and adopted.
EXHIBIT 1
TO
BOND RESOLUTION
(Form of Bond)
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF PLYMOUTH
Industrial Development Revenue Bond
(Garlock Equipment Co. Project)
Series 1978
No. 1
61,150,000
The City of Plymouth, a municipal corporation in the
County of Hennepin and State of Minnesota (the "City"), for value
received, hereby promises to pay, but solely from the source and
in the manner hereinafter provided to Farmers & Mechanics Savings
Bank of Minneapolis or registered assigns the outstanding and
unpaid balance of advances on account of an authorized uriicipal
sum of One Million One Hundred Fifty Thousand Dollars ($1,150,000),
on November 1, 1994, upon the presentation and surrender hereof,
and to make prepayments of said principal sum in installments as
hereinafter provided, and to pay to the owner hereof interest on
the outstanding and unpaid balance of advances on account of such
principal sum from the date hereof until said balance of the
principal sum is paid at the rate of Eight and twenty-fivz hun-
dredths percent (8.25%) per annum. Interest is payable in monthly
installments commencing December 1, 1978, and interest accruing
hereon shall be payable on the 1st day of each month from December 1,
1978, to November 1, 1979, both inclusive. Principal and interest
are payable in up to equal 324 monthly installments of $8,875
each commencing December 1, 1979, and continuing the 1st day of
each month thereafter to and including October 1, 1994 (or such
prior date when the outstanding and unpaid balance of advances
on account of the authorized principal sum hereof plus interest
thereon shall have been fully paid) plus a final installment
(unless the outstanding and unpaid balance of advances on account
of the authorized principal sum hereof plus interest thereon
shall have been previously paid) on November 1, 1994, at which
time the outstanding and unpaid balance of the authorized princi-
pal sum hereof plus interest thereon shall become due and payable.
Principal and interest shall be paid to the registered holder
hereof in Federal or other mediately available funds at the
main office of the Farmers & Mechanics Savings Bank of Minneapolis,
in Minneapolis, Minnesota.
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This Bond is issued pursuant to the Minnesota Municipal
Industrial Development Act, Chapter 474, Minnesota Statutes, as
amended (the "Act"), and in conformity with the provisions,
restrictions and limitations thereof. This Bond does not consti-
tute a charge ag,inst the general credit or taxing powers of the
City and does not grant to the owner or holder of this Bond any
right to have the City levy any taxes or appropriate any funds
for the payment of the principal hereof or interest hereon, nor
is this Bond a general obligation of the City or the individual
officers or agents thereof. This Bond and interest hereon are
payable solely and only from the moneys received under the Loan
Agreement, Mortgage or Guaranty Agreement hereinafter mentioned,
including loan repayments to be made by Garloc4r. Equipment Co., a
Minnesota corporation (the "Company").
This Bond represents an authorized series of special
obligation Bonds of an aggregate principal amount of $1,150,000,
which have been authorized by law to be issued and have been
issued for the purpose of funding a loan from the City to the
Company to finance costs of a project for constructing an indus-
trial plant in the City for use by the Company in its business
(the "Project"). This Bond is issued pursuant to a Loan and
Purchase Agreement (the "Loan Agreement") by and among the City,
the Company and Farmers & Mechanics Savings Bank of Minneapolis
dated as of October 1, 1978, and a Bond Resolution of the City
duly adopted November , 1978. This Bond is secured by the Loan
Agreement, the Bond Resolution a Comb3.nation Mortgage and Security
Agreement (the "Mortgage") by the Company to the said Bank dated
as of October 1, 1978 and a Guaranty Agreement (the "Guaranty
Agreement") dated as of October 1, 1978 executed by the Company
to said Bank to which Loan Agreement, Bond Resolution, Guaranty
Agreement and Mortgage and amendments thereof reference is hereby
made for a description and limitation of the revenues and funds
pledged and appropriated to the payment of the Bond, the nature
and extent of the security thereby created, the rights of the
Holders of the Bond, the rights, duties and=:amunities of the
Bank and the rights, immunities and obligations of the City
thereunder. Certified copies of the Bond Resolution and executed
counterparts of the Loan Agreement, Mortgage and Guaranty Agreement
are on file at the office of the City Clerk.
The outstanding and unpaid balance of advances on
account of the authorized principal sum of this Bond is the
aggregate of loans made by the City to the Company from Bond
proceeds paid by the Bank under the Loan Agreement, as evidenced
by the notations on Annex A attached to this Bond 4nd hereby made
a part hereof, less repayments of principal made to the Holder
hereof. As provided in the Loan Agreement, the notation of the
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amount and date of an advance and receipt by the Authorized
Company Representative set forth on Annex A is conclusive evidence
of the amount and date of the payment by the Bank, the loan by
the Municipality to the Company, and the receipt of the loan by
the Company.
The Bond shall be subject to prepayment at any time at the option
of the City, at the request of the Company in whole or in part as
provided in Section 5.05 of the Loan Agreement upon sixty (60)
dayel prior mailed notice to the last known Holder at par, accrued
interest plus a premium of the amount prepaid as follows:
5% premium if prepaid on or before November 1, 1989
4 1/2% premium if prepaid after November 1, 1989, but before
November 1, 1990
4% premium if prepaid after November 1, 1990, but before
November 1, 1991
3 1/2% premium if prepaid after November 1, 1991, but before
November 1, 1992
3% premium if prepaid after November 1, 1992, but before
November 1, 1993
2 1/2% prem. -Lam if prepaid after November 1 1993, but before
November 1, 1994
Partial prepayments shall be applied to the principal installments
last to become due in inverse order of due date. The Bond is
also subject to optional redemption at par plus accrued interest
in certain events of damage, destruction or condemnation of the
Project, change of law, as a result of a court order or decree or
if the Bank agrees to finance any future project to be located on
the Project Site as provided in Section 5.05 of the Loan Agreement.
If a Determination of Taxability shall be made and the Company
shall elect not to redeem the Bond, the Bond shall bear interest
on the unpaid principal amount at the interest rate of 9.75% per
annum from the date from which the interest on the Bond is deter-
mined to have been taxable.
On or after November 1, 1993, but before November 1, 1994,
the Municipality, at the request of the Holder of the Bond, shall
have the option upon six months prior written notice to the Company,
to declare the outstanding principal balance of the Bond to be
due and payable in full at par plus accrued interest, thirty days
from the exercise of the option.
Notice of any such prepayment shall be given to the
owner or registered assigns of the Bond by certified or registered
mail, addressed to him at his registered address, not later than
sixty (60) days prior to the date fixed for prepayment, and shall
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be published, if required by law, in a financial journal circu-
lated in the English language in the cities of Minneapolis or St.
Paul, Minnesota, at least once, not less than sixty (60) days
before the date so fixed for prepayment_ At the date fixed for
prepayment, funds shall be paid to the owner hereof at the office
of the Farmers & Mechanics Savings Bank of Minneapolis, Minneapolis,
Minnesota, or shall be deposited with said Bank, sufficient to
pay the Bond, or the principal amount thereof to be prepaid, and
accrued interest thereon. Upon the happening of the above condi-
tions, the Bond thus called or the principal portions thereof
prepaid shall not bear interest after the date specified for
prepayment.
This Bond is transferable, as provided in the Bond
Resolution, only upon the bond register of the City Clerk, as
bond registrar, by the owner hereof in person or by his duly
authorized attorney, as provided in the Bond Resolution.
Under paragraph 11 of the Bond Resolution a substitute
Bond may be issued in a principal sum equal to the outstanding
and unpaid balance of advances on account of the authorized
principal sum of this Bond, in certain cases, with an adjusted
schedule of installment payments thereafter to be made hereon,
subject to approval of the Holder hereof and the Company. In
case this Bond shall become mutilated, lost or destroyed, a
substitute Bond may be issued in the manner and subject to the
conditions provided in the Bond Resolution.
In case an Event of Default as defined in the Loan
Agreement occurs, the Bond and the Loan Repayments thereafter to
become due under the Loan Agreement may become immediately due
and payable, in the manner and with the effect and subject to the
conditions provided in the Loan Agreement. The Holder of the
Bond shall hava the right to enforce the provisions of the Bond
Resolution, Loan Agreement, Mortgage, and Guaranty Agreement.
The terms and provisions of the Bond Resolution, Loan
Agreement, Guaranty Agreement, and Mortgage, or of any instrument
supplemental thereto, may be modified or altered pursuant to
Section 9.03 of the Loan Agreement and paragraph 11 of the Bond
Resolution.
It is hereby certified and recited and the City Council
has found: That the Project is an eligible "project" defined in
Section 474.02, Subd. 1 of the Act; that the issuance of the Bond
and the acquisition and construction of the Project will promote
the public welfare and carry out the purposes of the Act; that
the Project has been approved by the Commissioner of Securities
of :.be State of Minnesota as tending to further the purposes and
policies of the Act; that all acts, conditions and things required
to be done precedent to and in the issuance of this Bond have
been properly done, have happened and have been performed in
regular and Niue time, form and manner as required by law; and
that this Bond does not constitute a debt of the City within the
meaning of any constitutional or statutory limitation.
-4-
W
IN WITNESS WHEREOF, the City of Plymouth, by its City
Council, has caused this Bond to be signed in its behalf by the
manual signatures of the Mayor and the City Manager and sealed with
the corporate seal of the City, all as of the6th day of November
1978. `
CITYOUTH
=�.—j
By/7 c<�
(SEAL) Mayor
and by ----I J 3S�
ty Manager
-5-
(Form of Transfer)
For value received, the undersigned owner does hereby
assign and transfer the foregoing Bond to the named Assignee, and
the undersigned City Clerk of the City of Plymouth as bond regis-
trar hereby certifies that the foregoing Bond has been transferred
and registered on the bond register in the name of such Assignee.
Date of
Name of Signature of Signature of Transfer on
Assignee Owner City Clerk Bond Register
(Form of Annex A)
The undersigned Authorized Company Representative of
Garlock Equipment Co. and the Authorized Municipal Representative,
hereby certifies that Farmers & Mechanics
Savings Bank of Minneapolis, as purchaser thereof, has made the
following payment of an installment of the purchase price of the
City of Plymouth, Minnesota, Industrial Development Revenue Bond
(Garlock Equipment Co. Project), Series 1978, and that said
payment has been loaned to and received by the Company pursuant
to the Loan and Purchase Agreement dated as of October 1, 1978,
by and among the City of Plymouth, Garlock Equipment Co. and
Farmers & Mechanics Savings Bank of Minneapolis:
Amount of Date of
Payment Payment
-6-
Signature of Authorized
Company Representative
Signature of Authorized
Municipal Representative
EXHIBIT 2
TO BOND RESOLUTION
ASSIGNMENT AND PLEDGE'AGREEMENT
This Assignment is made as of the 1st day of November,
1978 between the CITY OF PLYMOUTH, Minnesota, a municipal
corporation in the County of Hennepin and State of Minnesota (herein
called the "City") and FARMERS & MECHANICS SAVINGS BANK (herein
called the "Bondholder").
Recitals
The City has executed and delivered to the Bondholder
its single fully registered Industrial Development Revenue Bond
(Garlock Equipment Co. Project) in the principal amount of
$1,150,000 dated the date of delivery, issued pursuant to a
resolution adopted November 6, 1978.
The proceeds of the Bond have been loaned to Garlock
Equipment Co. (the "Company") pursuant to a Loan and Purchase
Agreement dated as of October 1, 1978, between the City and the
Company.
The mond is payable from and secured by the Loan Repay-
ments to be made by the Company under the Loan Agreement and the
Bondholder, as a condition to the purchase of the Bond, has
required the execution of this Assignment.
ACCORDINGLY, as authorized by the Bond Resolution and
in consideration of the premises and other good and valuable
consideration, the receipt of which is hereby acknowledged, the
City does hereby grant, transfer and assign to the Bondholder and
its registered assigns of the Bond, all of the right, title and
interest of the City in the Loan and Purchase Agreement and the
Loan Repayments of the Company payable thereunder (except for the
rights of the City under Section 5.02, 7.01, 8.04 and 8.05 thereof
relating to expenses, indemnity and advances of the City), all
for the purpose of securing the Bond.
IN WITNESS WHEREOF, the City has executed this Assignment
as of the date first above written.
CITY OF PLYMOUTH
By _ ^�
Mayor
Attest ���i'���'� By •�.� .,��
City Clerk City Manager
(seal)