HomeMy WebLinkAboutCity Council Resolution 1992-361•
RESOLUTION NO. 92-361
RESOLUTION AUTHORIZING
THE ISSUANCE AND SALE OF
$3,750,000 VARIABLE RATE DEMAND INDUSTRIAL DEVELOPMENT
REVENUE BONDS, SERIES 1992 A AND B
(FOOD ENGINEERING CORPORATION PROJECT)
TO FINANCE A PROJECT
BE IT RESOLVED by the Council of the City of Plymouth,
Minnesota, as follows:
1. The Council has received a proposal from Ralph D.
Burgess, Jr. (the "Company") that the City undertake to refinance
an existing tax-exempt Note and finance a certain Project as herein
described, pursuant to Minnesota Statutes, Sections 469.152 through
469.165 (the "Act"), through issuance by the City of its $3,750,000
Variable Rate Demand Industrial Development Revenue Bonds, Series
1992 A and B (Food Engineering Corporation Project) (the "Bonds").
2. It is proposed that, pursuant to a Loan Agreement
dated as of June 1, 1992, between the City and the Company (the
"Loan Agreement"), the City loan the proceeds of the Bonds to the
Company to refund the outstanding principal balance of the $905,000
Industrial Development Revenue Note (Burgess Project) issued by the
City on July 21, 1977 (the "Prior Note") and to finance certain
capital costs incurred by the Company in connection with the
construction and equipping of an expansion of its existing
manufacturing facility at 2765 Niagra Lane in the City (The
"Project"). The basic payments to be made by the Company under the
Loan Agreement are fixed so as to produce revenue sufficient to pay
the principal of, premium, if any, and interest on the Bonds when
due. It is further proposed that the City assign its rights to the
basic payments and certain other rights under the Loan Agreement to
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Minnesota (the "Trustee") as security for payment of the Bonds
under an Indenture of Trust dated as of June 1, 1992 (the
"Indent.ure"). Payment of the Bonds is initially secured by an
irrevocable Letter of Credit to be issued by First Bank, National
Association in favor of the Trustee in an amount equal to the
principal amount of the Bonds plus certain additional interest
thereon. The Bonds are intended to be privately placed with
accredited investors by FBS Investment Services, Inc. (the
"Placement Agent"), pursuant to a Private Placement Memorandum (the
"Memorandum").
3. Pursuant to the preliminary approval of the Council,
forms of the following documents will be executed by the City in
connection with issuance of the Bonds:
(a) The Loan Agreement
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(b) The Indenture
The use of the Memorandum is hereby approved, but the City takes no
responsibility for any of the information contained therein.
4. It is hereby found, determined and declared that:
(a) it is desirable that the Bonds be issued by the
City upon the terms set forth in the Indenture;
(b) the basic payments under the Loan Agreement are
fixed to produce revenue sufficient to provide for the prompt
payment of principal of, premium, if any, and interest on the
Bonds issued under the Indenture when due, and the Loan
Agreement and Indenture also provide that the Company is
required to pay all 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 Premises and payable during the
term of the Loan Agreement and Indenture; and
(c) under the provisions of Minnesota Statutes,
Section 469.155, and as provided in the Loan Agreement and
Indenture, the Bonds are not to be payable from or charged
upon any funds other than the revenue pledged to the payment
thereof; the City is not subject to any liability thereon; no
holder of any Bonds shall ever have the right to compel any
exercise by the City of its taxing powers to pay any of the
Bonds or the interest or premium thereon, or to enforce
payment thereof against any property of the City except the
interests of the City in the Loan Agreement which have been
assigned to the Trustee under the Indenture; the Bonds shall
not constitute a charge, lien or encumbrance, legal or
equitable upon any property of the City except the interests
of the City in the Loan Agreement which have been assigned to
the Trustee under the Indenture; the Bonds shall recite that
the Bonds are issued without moral obligation on the part of
the state or its political subdivisions, and that the Bonds,
including interest thereon, are payable solely from the
revenues pledged to the payment thereof; and, the Bonds shall
not constitute a debt of the City within the meaning of any
constitutional or statutory limitation.
5. The forms of the Loan Agreement and Indenture and
exhibits thereto shall be subject to the final approval of the City
Attorney. The Loan Agreement and Indenture are directed to be
executed in the name and on behalf of the City by the Mayor and the
City Manager. Any other documents and certificates necessary to
the transaction described above shall be executed and delivered by
the appropriate City officers. Copies of all of the documents
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necessary to the transaction herein described shall be delivered,
filed and recorded as provided herein and in the Loan Agreement and
Indenture.
6. The City shall proceed forthwith to issue its Bonds,
in the form and upon the terms set forth in the Indenture. The
offer of the Placement Agent to place the Bonds for sale at par
plus accrued interest to the date of delivery at the interest rate
or rates specified in the Indenture as of the date of issuance of
the Bonds is hereby accepted. The Mayor and City Manager are
authorized and directed to prepare and execute the Bonds as
prescribed in the Indenture and to deliver them to the Trustee for
authentication and delivery to the Bond Purchaser.
7. The Mayor and City Manager and other officers of the
City are authorized and directed to prepare and furnish to the Bond
Purchaser certified copies of all proceedings and records of the
City relating to the Bonds, and such other affidavits and
certificates as may be required to show the facts relating to the
legality of the Bonds as such facts appear 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.
8. The approval hereby given to the various documents
referred to above includes approval of such additional details
therein as may be necessary and appropriate and such modifications
thereof, deletions therefrom and additions thereto as may be
necessary and appropriate and approved by the City Attorney and the
City officials authorized herein to execute said documents prior to
their execution; and said City officials are hereby authorized to
approve said changes on behalf of the City. The execution of any
instrument by the appropriate officer or officers of the City
herein authorized shall be conclusive evidence of the approval of
such documents in accordance with the terms hereof. In the absence
of the Mayor or Manager, any of the documents authorized by this
resolution to be executed may be executed by the Acting Mayor or
City Manager, respectively.
Adopted: June 15, 1992
Mayor
Attest
City Clerk
(SEAL)
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