Resolution - #05-06-189 - 06/28/2005

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Council Member Elvig introduced the following resolution and moved its adoption: RESOLUTION # 05-06-189 RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF $3,810,000 VARIABLE RATE DEMAND INDUSTRIAL DEVELOPMENT REVENUE BONDS, (KILKENNY LIMITED LIABILITY COMPANY PROJECT) SERIES 2005 TO FINANCE A PROJECT WHEREAS, the Council has received a proposal from Kilkenny Limited Liability Company, a Minnesota limited liability company (the "Company") that the City undertake to 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 $3,810,000 Variable Rate Demand Industrial Development Revenue Bonds (Kilkenny Limited Liability Company Project), Series 2005 (the "Bonds"); and WHEREAS, it is proposed that, pursuant to a Loan Agreement dated as of June 1, 2005, between the City and the Company (the "Loan Agreement"), the City loan the proceeds of the Bonds to the Company to finance the acquisition, renovation and equipping of a manufacturing facility located at 6400 Bunker Lake Boulevard in the City (the "Project") which xvill be owned by the Company and leased to Sign-Zone, Inc., a Minnesota corporation. 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 duc. It is further proposed that the City assign its rights to the basic payments and certain other rights under the Loan Agreement to U.S. Bank National Association in St. Paul, Minnesota (the "Trustee") as security for payment of the Bonds under an Indenture of Trust dated as of June t, 2005 (the "Indenture"). Payment of the Bonds is initially secured by an irrevocable Letter of Credit to be issued by Associated Bank Minnesota, National Association in favor of the Trustee in an amount equal to the principal amount of the Bonds, plus certain additional interest thereon. Thc Bonds will be purchased by Northland Securities, Inc. (the "Underwriter"), pursuant to a Bond Purchase Agreement among the City, the Company and the Underwriter (the "Purchase Agreement") and an Official Statement (the "Official Statement"). WHEREAS, forms of the following documents have been presented to the City and arc proposed to be executed by the City in connection with issuance of the Bonds: (a) (b) (c) The Loan Agreement The Indenture The Purchase Agreement 'Fhe use of the Official Statement is hereby authorized, but the City has not participated in the preparation of or reviewed, and will not participate in the preparation of or review of, the Official Statement and has not made and will not make any independent investigation of the facts and statements provided therein; accordingly, the City assumes no responsibility with respect thereto, including without limitation as to matters relating to the accuracy, completeness or sufficiency of the Official Statement.