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88-132 .. ,,-- j" ~ . CERTIFICATE OF ~CITY MANAGER I, the undersigned, being the duly qualified City Manager of the city of Chanhassen, Minnesota, hereby attest and certify that: 1. As such officer, I have the legal custody of the original record from which the attached resolution was transcribed. 2. I have carefully compared the attached resolution _ with the original record of the meeting at which the resolution was acted upon. 3. I find the attached resolution to be a true, correct and complete copy of the original: RESOLUTION NO. 88-132 e RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF $1,000,000 AGGREGATE PRINCIPAL AMOUNT OF INDUSTRIAL DEVELOPMENT REVENUE BONDS (LYMAN LUMBER COMPANY PROJECT), SERIES 1988, OF THE CITY; AUTHORIZING THE EXECUTION OF A FIRST SUPPLEMENTAL INDENTURE OF TRUST, A FIRST AMENDMENT TO LOAN AGREEMENT AND A BOND PURCHASE AGREEMENT, AND AUTHORIZING THE USE OF A PRIVATE PLACEMENT MEMORANDUM, ALL RELATING TO THE SERIES 1988 BONDS 4. Said resolution remains in full force and effect in the form in which adopted and has not been amended or repealed. 5. I further certify that the affirmative vote on said resolution was 5 ayes, 0 nayes, and 0 absent/abstention. 6. Said resolution was adopted at a special meeting which was duly held, pursuant to call and notice thereof, as required by law on December 12, 1988, and a quorum was present at such meeting. e , !\ , ,.., 1/", " ,I, (Sea 1 ~ . , l f I { , ~" , ) \ " \ ,,1; t 'I I <I' officially as such Manager and the 13th day of December , 1988. ;a~~" o Ashworth City Manager WITNESS my hand seal of said City, this 1'\ ". I) / iJji1L. r ~ , . e e RESOLUTION NO. 88-132 RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF $1,000,000 AGGREGATE PRINCIPAL AMOUNT OF INDUSTRIAL DEVELOPMENT REVENUE BONDS (LYMAN LUMBER COMPANY PROJECT), SERIES 1988, OF THE CITY; AUTHORIZING THE EXECUTION OF A FIRST SUPPLEMENTAL INDENTURE OF TRUST, A FIRST AMENDMENT TO LOAN AGREEMENT AND A BOND PURCHASE AGREEMENT, AND AUTHORIZING THE USE OF A PRIVATE PLACEMENT MEMORANDUM, ALL RELATING TO THE SERIES 1988 BONDS BE IT RESOLVED by the City Council (the Council) of the City of Chanhassen, Minnesota (the City), as follows: Section 1. Authorization and Recitals. 1.01. General Authority. This Council has received a proposal that the City finance a portion or all of the cost of a proposed project under Minnesota Statutes, Sections 469.152 through 469.165 (the Act), consisting of the construction of an approximately 30,240 square foot addition by Lyman Lumber Company (the Company) to its existing facility located at 18800 West 78th Street in the City, and the acquisition and installation of items of equipment therein (the Project). 1.02. Series 1979 Bonds. The City has heretofore issued its Industrial Development Revenue Bonds (Lyman Lumber Company Project), Series 1979, dated as of September 1, 1979, in the aggregate principal amount of $2,000,000 (the "Series 1979 Bonds"), for the purpose of financing the cost of a project under the Act consisting of the acquisition of land within the City (the "Land") and the construction of a storage and distribution facility thereon (the "Building"), by the Company, pursuant to an Indenture of Trust, dated as of September 1, 1979 (the "Original Indenture"), between the City and Northwestern National Bank of Minneapolis, as Trustee (the "Trustee"). The proceeds of the Series 1979 Bonds were loaned by the City to the Company, pursuant to a Loan Agreement, dated as ~f September 1, 1979 (the "Original Agreement"), between the City and the Company, and the 1979 Bonds are secured by a Mortgage and Security Agreement, dated of September 1, 1979 (the "Original Mortgage"), under which the Company is obligated to make payments sufficient to pay the principal of, premium, if any, and interest on the Series 1979 Bonds. 1.03. Proposed Project and Bonds. Allison-Williams Company, of Minneapolis, Minnesota (the "Underwriter") and representatives of the Company have proposed that the City, acting under and pursuant to the Act, issue and sell to the Underwriter, an additional series of bonds, pursuant to Section . I ..~ e e e 3-5 of the Original Indenture, designated as its Industrial Development Revenue Bonds (Lyman Lumber Company Project), Series 1988, dated as of December 1, 1988, in the principal amount of $1,000,000 (the "Series 1988 Bonds"), the proceeds of which are to be. used for the purpose of paying the costs of the Project. The Series 1988 Bonds will be issued pursuant to the Original Indenture, as supplemented by a First Supplemental Indenture of Trust, dated as of December 1, 1988 (the "Supplemental Indenture"), between the City and the Trustee (the Original Indenture, as s6 supplemented is hereinafter referred to as the "Indenture"). The proceeds of the Series 1988 Bonds will be loaned by the City to the Company pursuant to the Original Agreement, as amended by a First Amendment to Loan Agreement, dated as of December 1, 1988 (the "Amendment to Loan Agreement"), between the City and the Company (the Original Agreement, as so amended is hereinafter referred to as the "Agreement"). to secure payment on the Series 1988 Bonds the Original Mortgage will be supplemented by a First Amendment to Mortgage and Security Agreement, dated as of December 1, 1988 (the "Amendment to Mortgage"), from the Company to the Trustee (the Original Mortgage, as so amended is hereinafter referred to as the "Mortgage"). 1.04. Prior Approval. This Council following a public hearing on the Project, duly noticed and held on August 22, 1988, adopted a resolution giving preliminary approval to the Project and authorizing the issuance of the Series 1988 Bonds and the execution of documents relating thereto. 1.05. Documentation. Forms of the following documents relating to the Project and the Series 1988 Bonds have been prepared and submitted to this Council and are hereby directed to be filed in the office of the City Manager: (~) the Amendment to Loan Agreement; (b) the Supplemental Indenture; (c) the Amendment to Mortgage; (d) the Bond Purchase Agreement, by and among the Company, the Underwriter and the City (the "Bond Purchase Agreement"); and (e) a Private Placement Memorandum (the ("Private Placement Memorandum"), dated November 30, 1988. Section 2. Findings. This Council hereby finds, determines and declares that: -2- . M e (a) The welfare of the State of Minnesota requires active promotion, attraction, encouragement and development of economically sound industry and commerce through governmental acts to prevent, so far as possible, emergence of blighted lands and areas of chronic unemployment, and the State of Minnesota has encouraged local government units to act to prevent such economic deterioration. (b) The Project would further the general purposes contemplated and described in Section 469.152 of the Act. (c) The existence of the Project would add to the tax base of the City, the County and the School District in which the Project is located and would provide increased opportunities for employment for residents of the City and surrounding area. e (d) This Council has been advised by representatives of the Company, that conventional, commercial financing to pay the cost of the Project is available only on a limited basis and at such high costs of borrowing that the economic feasibility of constructing and operating the Project would be significantly reduced, but that with the aid of municipal borrowing, and its resulting lower borrowing cost, the Project is economically more feasible. (e) This Council has been advised by representatives of the Company that the Project would not be undertaken but for the availability of industrial development bond financing. (f) This Council has also been advised by representatives of the Company that on the basis of their discussions with potential buyers of tax-exempt bonds, revenue bonds of the City (which may be in the form of a revenue note or notes) could be issued and sold upon favorable rates and terms to finance the Project. (g) The City is authorized by the Act to issue its revenue bonds to finance capital projects consisting of properties used and useful in connection with a revenue producing enterprise, such as that of the Company, and the issuance of the bonds by the City would be a substantial inducement to the Company to undertake the Project. (h) This Council hereby finds that the issuance and sale of $1,000,000 aggregate principal amount of the e -3- e City's Industrial Development Revenue Bonds (Lyman Lumber Company Project), Series 1988 pursuant to the Act is in the best interest of the City and the City hereby determines to issue and sell such Series 1988 Bonds. The proceeds of the Series 1988 Bonds will be lent (the Loan) by the City to the Company, in order to finance the Project. (i) The financing of the Project, the authorization of the Series 1988 Bonds in the principal amount of $1,000,000, the execution and delivery of the Amendment to Agreement and the Supplemental Indenture and the performance of all covenants and agreements of the City contained in the Agreement, the Bond Purchase Agreement and the Indenture 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 and the Series 1988 Bonds valid and binding obligations in accordance with their terms, are authori~ed by the Act. e (j) The Series 1988 Bonds will be special limited obligations of the City payable solely from revenues derived from the Agreement, other than to the extent payable from the proceeds of the Series 1988 Bonds, amounts in the Reserve Fund held by the Trustee pursuant to the Indenture, the proceeds of insurance or condemnation awards or the proceeds resulting from the disposition of the property encumbered by the Mortgage upon a default by the Company under the Agreement. The Series 1988 Bonds shall not be payable from or charged upon any funds other than the revenue pledged to the payment thereof, nor shall the City be subject to any liability thereon. No holder or holders of any Series 1988 Bond shall ever have the right to compel any exercise of the taxing power of the City to pay any such Series 1988 Bond or the interest thereon, nor to enforce payment thereof against any property of the City except the Loan Agreement. The Series 1988 Bonds shall not constitute a debt of the City within the meaning of any constitutional or statutory provision. e Section 3. Authorization of Issuance of Bonds. In order to provide for the financing of the Project, the City hereby authorizes the issuance of the Series 1988 Bonds as revenue bonds under the Act, to be designated "City of Chanhassen, Minnesota, Industrial Development Revenue Bonds (Lyman Lumber Company Project), Series 1988" in the aggregate principal amount of $1,000,000. The Series 1988 Series 1988 Bonds shall be dated as of December 1, 1988, and shall mature in the years and amounts and contain the redemption and other provisions as are set forth in the Supplemental Indenture. The Series 1988 Bonds shall bear interest as provided in the Supplemental Indenture. -4- . . ., e e e Section 4. Execution of Bonds. Each Series 1988 Bond shall be executed on behalf of the city by the manual or facsimile signatures of the Mayor and the city Manager, and its corporate seal (which may be in facsimile) shall be thereunto affixed, imprinted or engraved. The Trustee is hereby designated as authenticating agent pursuant to Minnesota Statutes, Section 475.55. If any of the officers who shall have signed or sealed any of the Series 1988 Bonds shall cease to be such officers of the City before the Series 1988 Bonds so signed and sealed shall have been actually authenticated by the Trustee or delivered by the City, such Series 1988 Bonds nevertheless may be authenticated, issued and delivered with the same force and effect as though the person or persons who signed or sealed such Series 1988 Bonds had not ceased to be such officer or officers of the City. Section 5. Execution of Supplemental Indenture, Amendment to Loan Agreement and Bond Purchase Agreement. The Supplemental Indenture, the Amendment to Loan Agreement and the Bond Purchase Agreement are hereby made a part of this Resolution as fully as though set forth in full herein and are hereby approved in the form submitted to this meeting, and the Mayor and City Manager are hereby authorized and directed to execute, acknowledge and deliver the Supplemental Indenture, the Amendment to Loan Agreement and the Bond Purchase Agreement on behalf of the City with such changes, insertions and omissions therein as do not change the substance of the Supplemental Indenture, Amendment to Loan Agreement or Bond Purchase Agreement and as may be approved by the Mayor and City Manager, such approval to be evidenced conclusively by their execution of the Supplemental Indenture, the Amendment to Loan Agreement and the Bond Purchase Agreement and the City Manager is hereby authorized and directed to affix the corporate seal of the City to the Supplemental Indenture, the Amendment to Loan Agreement and the Bond Purchase Agreement. Section 6. Offering Documents. The Private Placement Memorandum is hereby made a part of this Resolution as fully as though set forth in full herein and is hereby approved in the form submitted to this meeting, said Private Placement Memorandum and the information contained therein are hereby authorized to be used by the Underwriter in connection with the sale of the Series 1988 Bonds; provided, however, that the City has made no independent investigation with respect to, and assumes no responsibility for the accuracy or completeness of the information contained in the Private Placement Memorandum. Section 7. Other Actions. The Mayor, the City Manager and all other officers of the City are hereby authorized and directed to execute and deliver all other -5- ~ ( e e e '. documents which may be required under the terms of the Supplemental Indenture, the Amendment to Loan Agreement or the Bond Purchase Agreement, and to take such other action as may be required or appropriate for the performance of the duties imposed thereby or to carry out the purposes thereof. Section 8. Absence or Disability of Officers. In the absence or disability of the Mayor, the City Manager or any other officer of the City named in any instrument to be executed on behalf of the City in connection with the issuance of the Series 1988 Bonds, the acting Mayor, acting City Manager or other officer may execute such instrument. The execution of any instrument by an officer of the City shall be conclusive evidence of its approval. Section 9. Compliance With Act. The Mayor and City Manager are directed, upon the issuance of the Series 1988 Bonds thereafter to comply with the provisions of Section 469.154, Subdivisions 5 and 7 of the Act. Section 10. Statement of Election. The City hereby elects that the provision of Section 144(a)(4) of the Internal Revenue Code of 1986, as amended, apply to the Series 1988 Bonds. Adopted by the City Council of Minnesota, this 12th day of De~ 198 Attest: QMO/6 (SEAL) '\ ) 1/ . '. .,' , , \' ,\, ' I ,(, \ ,. . l \ -6-