Minutes - Council - 01/08/2002 - Laserfiche WebLink

Home

COUNCIL BUSINESS Case #1: Public Hearing to Consider Amending Contract for Private Development between the City of Ramsey and Mateski Properties, Inc. Mayor Gamec closed the regular portion of the City Council meeting at 7:10 p.m. in order to conduct a public hearing. Public Hearing Mayor Gamec called the public hearing to order at 7:10 p.m. Presentation City Administrator Norman stated that the City entered into an agreement with Mateski Properties, Inc., d/b/a Systematic Refrigeration in June 2000. An 80,280 square foot building was constructed in 2000, which is currently being used for manufacturing, storage, and office space for the construction of refrigeration units. Mateski Properties have recently met with the City and informed the City of their intent to sell its interest to Zero Zone, Inc., a Wisconsin Corporation. Requirement to a sale would require the City to amend the job goal section of the Development Agreement authorized in the year 2000. Economic Development Consultant Mulrooney stated that the City of Ramsey had been approached by the owner of Systematic Refrigeration regarding the potential sale of the business to a company known as Zero Zone, Inc. Zero Zone is headquartered in North Prairie, Wisconsin. The company started in 1961, as a manufacturer of freezers. They soon became one of the first companies to use energy efficient glass doors in self-contained reach in freezer units. This is a product similar to what Systematic Refrigeration currently manufactures in Ramsey, only to different markets. In March 1999, Zero Zone was acquired by another company called C2, Inc., which is headquartered in Milwaukee, Wisconsin. C2, Inc. is a NASDAQ traded company engaged in integrated logistic services and the manufacturing of refrigerated merchandising equipment. The acquisition of Systematic Refrigeration fits with the business plan of C2 and its subsidiary Zero Zone, Inc. It will allow the company to grow at a more rapid rate and enter new markets. It is anticipated that the sale will occur through an asset purchase agreement. Zero Zone will be establishing a separate acquisition company called ZZ Acquisition II Corporation to complete the acquisition. The acquisition company will also be assuming some of the liabilities of Mateski Properties LLC and Systematic Refrigeration. The Contract for Private Development between the City of Ramsey and Mateski Properties, LLC is regarded as one of those liabilities. In December 2001, staff met with the Chairman of C2, Inc. and the President of Zero Zone along with representatives of the Minnesota Department of Trade and Economic Development to discuss a number of issues related to the acquisition. Zero Zone management stated at the meeting that they would require an amendment to the Contract for Private Development in order for the acquisition to proceed. Their main concern revolves around the job creation requirement City Council/January 8, 2002 Page 6 of 27