Loading...
1998-012CITY OF HOPKINS HENNEPIN COUNTY, MINNESOTA RESOLUTION NO. 98-12 A RESOLUTION AUTHORIZING THE ACQUISITION OF THE HOPKINS CENTER FOR THE ARTS AND APPROVING THE ISSUANCE OF PROMISSORY NOTE IN FAVOR OF THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF HOPKINS (THE "HOPKINS HRA") WHEREAS, the City of Hopkins (the "City") is authorized by Minn. Stat. 471.15 to 471.191 to "acquire ...equip and maintain, land, buildings, and other recreational facilities, including, but without limitation, ...concert halls, and facilities for other kinds of athletic or cultural participation, contests and exhibitions ...". WHEREAS, the Hopkins HRA has constructed the Hopkins Center for the Arts facility (the "HCA Facility") on real property located in the City of Hopkins, Hennepin County, Minnesota, legally described as follows: Lots 10, 11, 12, 13, 14 and 15, Block 70, West Minneapolis Second Division, according to the recorded plat thereof. The above-described land is hereinafter referred to as the "Real Property". WHEREAS, pursuant to the authority granted by Minn. Stat. 471.15 to 471.191, the City intends to acquire the HCA Facility from the Hopkins HRA upon the terms and conditions stated in this Resolution. WHEREAS, the Hopkins HRA has provided substantial financial assistance in the acquisition of the Real Property and payment of the costs of design and construction of the HCA Facility. WHEREAS, in consideration of the transfer of title to the Real Property and the HCA Facility from the Hopkins HRA to the City, and the substantial financial contribution by the Hopkins c:Mile\hpcivil\resolut.hca HRA to the acquisition and construction of the HCA Facility, the City intends to issue to the Hopkins HRA the $300,000.00 Promissory Note attached to this Resolution as Exhibit A. WHEREAS, the City has also contributed funds to the development and construction of the HCA Facility, including a $615,000.00 contribution from the City's general fund. WHEREAS, the City intends to repay the $615,000.00 contribution from the general fund from the revenues of the HCA Facility upon the terms and conditions stated in this Resolution. WHEREAS, the Hopkins HRA has entered into a Lease with Hopkins Independent School District No. 270 ("District No. 270") pursuant to which District No. 270 has agreed to lease portions of the HCA Facility, and said Lease and all other leases covering or affecting the Real Property or the HCA Facility are to be transferred to the City in connection with the transfer of the Real Property. WHEREAS, a Lease Agreement has also been negotiated with the Ho kins Area Arts p Association pursuant to which the Hopkins Area Arts Association has leased a portion of the HCA Facility. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF HOPKINS, that the following actions and Resolutions are hereby approved and adopted: 1. That the transfer of the fee title to the Real Property and the HCA Facility from the Hopkins HRA to the City is hereby authorized and accepted by the City. The HCA Facility shall be maintained and operated as a recreational and cultural facility under the authority established by Minn. Stat. 471.15 to 471.191. c:\filelhpcivil\resolut.hca 2 2. The $615,000.00 contribution from the City's general fund to the development and construction of the HCA Facility shall be repaid to the City's general fund upon and subject to the following terms and conditions: a. Said $615,000.00 repayment obligation (the "Indebtedness") shall bear interest on the unpaid principal balance thereof due from time to time at the rate of four percent (4%) per annum commencing on the date on which these Resolutions were duly adopted by the City Council of the City of Hopkins. The principal balance of the Indebtedness and interest thereon shall be payable in equal annual installments of principal and interest in the amount ofForty-five Thousand Two Hundred Fifty-three and no/100ths Dollars ($45,253.00) commencing March 1, 1999 and continuing on the first day of March of each and every successive year thereafter until the entire unpaid balance of the Indebtedness and accrued interest thereon shall have been paid in full. All payments on the Indebtedness shall be applied first to interest and the balance, if any, to principal. The Indebtedness may be prepaid, in whole or in part, at any time without penalty. b. The principal balance of the Indebtedness and all interest thereon shall be payable solely from the rents, revenues and income (the "Revenues") received by the City from the use and operation of the HCA Facility. The Indebtedness and the interest due thereon shall not be a general obligation of the City but shall be repayable only from the Revenues from the operation of the HCA Facility and not from any other source. Principal and interest payments on the Indebtedness shall be due and payable only as and to the extent there are sufficient funds available to make said payments, when due, from the Revenues after the payment of all costs of operation, maintenance and repair of the HCA Facility. c. The Indebtedness shall have priority to the City's obligation to pay any amounts due to the Hopkins HRA under the Promissory Note attached to these Resolutions as Exhibit A. 3. In consideration of the transfer of the Real Property and the HCA Facility to the City, and in partial payment of the HRA's financial contribution to the acquisition of the Real Property and construction of the HCA Facility, the City shall issue to the Hopkins HRA a $300,000.00 Promissory Note, in the form of and containing the terms and conditions stated in the Promissory Note attached to these Resolutions as Exhibit A. Said $300,000.00 Promissory Note shall be subordinated to the Indebtedness described in Paragraph 2 of these Resolutions. The Honorable c:\fi le\hpcivil\resolut.hca Mayor and City Clerk of the City are hereby authorized, empowered and directed to execute and deliver said Promissory Note to the Hopkins HRA. 4. The transfer of all leases covering or affecting the Real Property or the HCA Facility, including the Lease Agreement with District No. 270, from the Hopkins HRA to the City is hereby approved and accepted. In connection with the transfer of the Real Property to the City, the Honorable Mayor and City Clerk of the City are hereby authorized, empowered and directed to execute and accept from the Hopkins HRA an Assignment of Leases assigning the Landlord's interest in all of said leases to the City. The proposed Lease Agreement with the Hopkins Area Arts Association is hereby approved, and the Honorable Mayor and City Clerk of the City are hereby authorized, empowered and directed to execute said Lease Agreement for and on behalf of the City. • I certi that the above Resolutions were ado ted b the Cit Council of the C' f fS' p y y rty o Hopkins at a hearing of the City Council held on March 4, 1998. Attest: Terry O crier, City Clerk c:Mile\hpcivil\resolut.hca 4 EXHIBIT A PROMISSORY NOTE $300,000.00 Dated: March 4 , 1998 FOR VALUE RECEIVED, the undersigned, the City of Hopkins, a municipal corporation under the laws of Minnesota (hereinafter referred to as "Borrower") hereby agrees and promises to pay to the order of The Housing and Redevelopment Authority in and for the City of Hopkins, Minnesota, a public body corporate and politic (hereinafter referred to as "Lender"), at its office at 1010 First Street South, Hopkins, Minnesota 55343, or such other place as the Lender may from time to time designate the principal sum of Three Hundred Thousand and no/100ths Dollars ($300,000.00), together with interest on the unpaid principal balance of this Note at the rate of four percent (4%) per annum commencing on the date of this Note. Both principal and interest thereon shall be payable in coin or currency which at the time of payment is legal tender for the payment of public or private debts in the United States of America and shall be payable as provided in the third and fourth paragraphs of this Note. All payments hereunder shall be applied first to interest and the balance, if any, to principal. Borrower may prepay the principal of this Note, in whole or in part, at any time without penalty. Notwithstanding any provision of this Note apparently to the contrary, principal, interest and any and all other sums due to Lender under this Note shall be payable solely from the rents, revenues and income (the "Revenues") received by the Borrower from the use and operation of the Hopkins Center for the Arts facility located at 1111 Mainstreet, Hopkins, Minnesota (the "HCA Facility"). The indebtedness evidenced by this Note shall not be a general obligation of Borrower and, by accepting this Note, Lender agrees to look only to the Revenues from the operation of the HCA Facility for the payment of the indebtedness evidenced by this Note, and Lender acknowledges it shall not be entitled to seek or recover payment of s>.tch indebtedness from any other source. Borrower shall not be in default hereunder in the event the Revenues from the operations of the HCA Facility are insufficient to pay the principal and interest payments due Lender as described in this Note, and said principal and interest payments shall be due and payable only as and to the extent Borrower has sufficient funds available to make said payments, when due, from the Revenues. Reference is made to the $615,000.00 Indebtedness (the "Indebtedness") to the general fund of Borrower established by Paragraph 2 of Hopkins City Council Resolution No. 98-12, the source of payment of which is also limited to the Revenues. This Note is specifically subordinated to the Indebtedness, including the principal thereof and all interest due thereon, and Borrower shall be obligated to make payments of principal and interest under this Note only as and to the extent there are sufficient Revenues available after payment of all principal and interest payments due on the Indebedness, and after all expenses of operation, repair and maintenance of the HCA Facility have been paid currently, and in full. To the extent excess Revenues are available after payment of all c: \t"ilelhopcivillnote300. hca amounts due to the general fund of the Borrower to repay the Indebtedness, and interest thereon, and payment of all costs of operation, repair and maintenance of the HCA Facility, such excess Revenues shall be paid to Lender and applied to the principal and interest due on this Note. It is agreed that time is of the essence in the performance of this Note. In the event of default in the payment of principal or interest due on this Note, or if any other default occurs in the performance or observance of the terms and conditions of this Note or the Loan Documents, Lender shall have the right and option to declare, upon thirty (30) days written notice, all of the remaining unpaid principal balance of this Note, together with accrued and/or accruing interest thereon, immediately due and payable. Lender may exercise this option to accelerate for any default by Borrower regardless of any prior forebearance. In the event of any default hereunder the Borrower agrees to pay all costs of collection including reasonable attorneys' fees and legal expenses, whether or not legal proceedings are commenced. No delay on the part of Lender in exercising any right or remedy under this Note shall operate as a waiver of or preclude the exercise of such right or remedy or any other remedy under this Note. No waiver by Lender shall be effective unless in writing signed by Lender. A waiver on one occasion shall not be construed a waiver of any such right or remedy on a future occasion. Borrower expressly waives demand for payment, presentment, notice of presentment, notice of dishonor, protest and notice of protest. This Note shall be the joint and several obligation of all makers, sureties, guarantors and endorsers and shall be binding upon them and their successors and assigns. All remedies of Lender under this Note may be exercised by Lender concurrently or consecutively. No failure or omission of Lender to exercise any such right or remedy shall constitute a waiver thereof. Prior to the payment in full of all indebtedness evidenced by this Note, Borrower shall not voluntarily or involuntarily sell, convey, transfer, assign or dispose of the HCA facility, the real property on which it is located, or any part thereof, or any interest therein, legal or equitable, or agree to do so, without first obtaining the prior written consent of Lender. Likewise, the legal, beneficial or equitable ownership of Borrower shall not be changed by sale, transfer or assignment without first obtaining the written consent of Lender. All agreements between Lender and Borrower are expressly limited so that in no contingency or event whatsoever, whether by reason of acceleration of maturity of the indebtedness evidenced hereby or otherwise, shall the amount paid or agreed to be paid to Lender for the use, forbearance, loaning or detention of the indebtedness evidenced hereby exceed the maximum rate permissible under applicable law. If, from any circumstances whatsoever, fulfillment of any provisions hereof or of the Mortgage shall involve transcending the limit of interest permitted by law, then, the obligation to be fulfilled shall automatically be reduced to the limit of such validity and if from any circumstances Lender should ever receive as interest an amount which would exceed the highest lawful rate, such amount which would be in excess of such highest lawful rate shall be applied to the reduction of principal balance evidenced hereby and not to the payment of interest. This provision c:lfilelhopcivillnote300.hca 2 shall control every other provision of all agreements between the Borrower and Lender and shall also be binding upon and available to any subsequent holder or endorsee of this Note. This Note is made pursuant to and shall be construed in accordance with the laws of the State of Minnesota. IN WITNESS WHEREOF, the Borrower has executed this Note the day and year first written above. The City of Hopkins, Minnesota c:Mile\hopcivil\note300.hca 3 C es Redepenning, ayor