17-037RESOLUTION NO. 17 - 037
RESOLUTION AUTHORIZING THE EXECUTION AND DELIVERY OF
AMENDMENTS TO A GROUND LEASE AND LEASE - PURCHASE
AGREEMENT, AND APPROVING AND AUTHORIZING THE
ISSUANCE OF PUBLIC PROJECT LEASE REVENUE REFUNDING
BONDS, SERIES 2017A (THE `BONDS ") AND RELATED DOCUMENTS
BE IT RESOLVED by the City Council of the City of Shorewood, Minnesota
( "Council ") as follows:
ARTICLE I
RECITALS
1.01. The City of Shorewood, Minnesota (the "City ") is authorized by Minnesota
Statutes, Section 465.71, as amended to acquire real and personal property as are needed to carry
out its governmental and proprietary functions, and to acquire such real and personal property by
entering into lease - purchase agreements.
1.02. The City previously agreed with the Shorewood Economic Development
Authority for the City (the "Authority ") that pursuant to a Ground Lease dated as of August 1,
2008 (the "Original Ground Lease "), the Authority would acquire certain property from the
City, and the Authority would lease such property, together with the buildings, structures or
improvements then located or to be located thereon, to the City pursuant to a Lease - Purchase
Agreement dated as of August 1, 2008 (the "Original Lease ").
1.03. Pursuant to a resolution adopted on July 28, 2008 (the "2008 Bond Resolution "),
the Authority issued its Public Project Lease Revenue Bonds, Series 2008A (City of Shorewood,
Minnesota Lease Obligations) (the "2008A Bonds ") in an aggregate principal amount of
$1,310,000.
1.04. Under the 2008 Bond Resolution, proceeds of the 2008A Bonds were used to pay
costs of acquisition, construction and equipping of the Facilities (as defined in the Original
Lease ").
1.05. Based on available interest savings, the Authority has decided that it is desirable
and in the best interest of the Authority and the City to issue its Public Project Lease Revenue
Bonds, Series 2017A (City of Shorewood, Minnesota Lease Obligations) (the "2017A Bonds ")
for purposes of refunding all of the 2008A Bonds and paying costs of issuance thereof.
1.06. In connection with the issuance of the 2017A Bonds, forms of amendments to the
Original Ground Lease and Original Lease have been prepared and submitted to this Council and
are on file with the City.
1.07. All terms capitalized but not defined herein shall have the meaning ascribed to
such terms as in the Lease (defined below).
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ARTICLE II
FINDINGS
2.01. On the basis of the information given to the City to date, it is hereby found,
determined and declared that:
(a) It is desirable and in the best interest of the City to enter into the First
Amendment to Ground Lease dated as of May 1, 2017, between the City and the
Authority, amending the Original Ground Lease (as amended, the "Ground Lease ").
(b) It is desirable and in the best interest of the City to enter into the First
Amendment to Lease - Purchase Agreement dated as of May 1, 2017, between the City
and the Authority, amending the Original Lease (as amended, the "Lease ").
(c) The terms of the Ground Lease and Lease are found to be advantageous to
the City and the form and terms thereof are hereby approved.
(d) The Site and Facilities described in the Lease constitute essential
governmental property, and the City presently intends to appropriate all Lease Payments
under the Lease for the term of the Lease; however, the obligation of the City under the
Lease are not to be payable from nor charged upon any funds of the City other than the
funds appropriated annually to the payment thereof, and the Lease shall not constitute a
charge, lien, or encumbrance, legal or equitable, upon any property of the City except its
interest in the Lease and in the Site and the Facilities under the Lease.
ARTICLE III
AUTHORIZATION OF DOCUMENTS
3.01. The Mayor and the City Administrator are authorized and directed to execute and
deliver the Ground Lease and the Lease on behalf of the City, substantially in the forms on file,
but with all such changes therein as shall be approved by the officers executing the same, which
approval shall be conclusively evidenced by the execution thereof. Copies of all of the
transaction documents shall be delivered, filed and recorded as provided therein. The Mayor, the
City Administrator and other City officers are also authorized and directed to execute such other
instruments or certificates as may be required to give effect to the transactions herein
contemplated.
ARTICLE IV
APPROVAL OF ISSUANCE AND SALE OF 2017A BONDS
4.01. The issuance and sale by the Authority of the 2017A Bonds as described in the
bond resolution of the Authority is hereby approved in all respects. The City will pay, from
proceeds of the 2017A Bonds or from other City funds, the costs of issuance of the 2017A
Bonds.
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ARTICLE V
PAYMENT OF LEASE PAYMENTS
5.01. The City will pay to the Registrar of the 2017A Bonds, promptly when due, all of
the Lease Payments and other amounts required by the Lease. To provide moneys to make such
payments, the City will include in its annual budget, for each Fiscal Year during the term of the
Lease, commencing with the Fiscal Year ending on December 31, 2017, moneys sufficient to
pay and for the purpose of paying all Lease Payments, a reasonable estimate of Additional Lease
Payments, and other amounts payable under the Lease. The agreement of the City in this Section
is subject to the City's right to terminate the Lease at the end of any Fiscal Year, as set forth in
Section 5.6 of the Lease. The City's fiscal year 2017 budget is hereby amended to reflect the
new payments required for the Series 2017A Bonds.
ARTICLE VI
MISCELLANEOUS
6.01. The City covenants and agrees with the owners from time to time of the 2017A
Bonds that the investment of proceeds of the 2017A Bonds, if any, including the investment of
any revenues pledged to the Lease Payments which are considered proceeds under applicable
regulations, and accumulated sinking funds, if any, shall be limited as to amount and yield in
such manner that the Bonds shall not be "arbitrage bonds" within the meaning of Section 148 of
the Internal Revenue Code of 1986, as amended, and applicable regulations thereunder, and that
the City shall comply with all other applicable requirements of Section 148. On the basis of the
existing facts, estimates and circumstances, including the foregoing findings and covenants, the
City hereby certifies that it is not expected that the proceeds of the 2017A Bonds will be used in
such manner as to cause the Bonds to be "arbitrage bonds" under Section 148 and any
regulations thereunder. The Site, the Facilities and the proceeds of the Bonds will likewise be
used in such manner that the Bonds will not be "private activity bonds" under Section 141 of the
Internal Revenue Code of 1986, as amended, and applicable regulations.
6.02. The officers of the City are authorized and directed to prepare and furnish to the
original purchaser of the 2017A Bonds, and to the attorneys approving the 2017A Bonds,
certified copies of all proceedings and records of the City relating to the power and authority of
the City to enter into the Ground Lease and the Lease within their knowledge or as shown by the
books and records in their custody and control, and such certified copies and certificates shall be
deemed representations of the City as to the facts stated therein.
6.03. The City covenants that it will file (or cause the Authority to file) with the
Internal Revenue Service the information required under Section 149(e) of the Internal Revenue
Code of 1986.
6.04. The City will annually provide to the Purchaser its audited financial statements
within 270 days of the end of the City's fiscal year.
6.05. This resolution shall be effective immediately upon its final adoption.
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Adopted this 24ffi day of April, 2017 by the City Council of the City of Shorewood,
Minnesota.
CITY OF SHOREWOOD, MINNESOTA
U10A
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