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02-892� ORiGINAL RESOLUTION CITY OF SAINT PAUL, MINNESOTA Presented Referred To Council File # O?.-F?A Green Sheet # 101347 �l Comcnittee Date 1 WHEREAS: 3 1. The Port Authority of the City of Saint Paul (the "Authority") has given its approval to tkie issuance of 4 its $3,700,000 Variable Rate Demand Industrial Development Revenue Refunding Bonds (Camada Limited 5 Partnership Project) Series 2002-7 (the `Bonds") in the aggregate principal amount of $3,700,000, to refund the 6 $1,500,000 Development Revenue Note previously issued by the Port Authority to finance the acquisition by 7 Camada Limited Partnership (the `Borrower") of a building located 274 Fillmore Avenue, in the Cityof Saint Paul, 8 Minnesota (the "Cit�'), which was to be owned by the Borrower and leased to Vomela Specialty Company for its 9 use. In addition, proceeds from the sale of the Bonds will be loaned to the Borrower to finance the purchase of 10 printing equipment to be used in the Building. The refinancing of the Building and the Acquisition of the printing 11 equipment to be used therein are collectively referred to herein as the "ProjecY'; and 12 13 2. Laws of Minnesota 1976, Chapter 234, provides that any issue of revenue bonds authorized by the 14 Authority shall be issued only with the consent of the City Council of the City of Saint Paul, by resolution adopted 15 in accordance with law; and 16 17 18 19 20 21 22 23 24 25 26 27 3. Approval of the issuance of the proposed Bonds by the City Council is also required by Section 147(f� of the Internal Revenue Code of 1986, as amended; and 4. To meet the requirements of both state and federal law, the Port Authority has requested that the City Council gives its requisite approval to the issuance of the proposed Bonds by the Port Authority, subject to fina] approval of the details of said Bonds by the Port Authority; and 5. The Council of the City has previously approved by issuance of the $1,500,000 Development Revenue Note to be refunded through the issuance of the Bonds, by its Resolution No. 95-1438 adopted December 13, 1995. 28 NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Saint Paal that, in accardance with 29 the requirements of Section 147(� of the Internal Revenue Code of 1986, as amended, and in accordance with 30 Laws of Minnesota 1976, Chapter 234, the City Council hereby approves the issuance of the aforesaid Bonds by 31 the Port Authority for the purposes described in the Port Authority resolution adopted August 27, 2002, the exact 32 details of which, including but not limited to, provisions relating to principal amount, maturities, interest rates, 33 discount, redemption, and the issuance of additional bonds are to be determined by the Port Authority, and the City 34 Council hereby authorizes the issuance of any additional bonds (including refunding bonds) by the Port Authority 35 found by the Port Authority to be necessary for carrying out the purposes for which the aforedescribed Bonds are 36 issued. 37 38 Adopted: September 25, 2002 23855.1. ORlGINAL oa-� : ,.���ii � .� , :: .��o�� . -.,.. �■���■ : ,����� �e�� -. . .�: �. ,,. ;•: I�'�_�, r1 �. ��� � Form � AdoptedbyCouncil: Date �—�,� ��_5, e�_-OC'� —' ApI Adoption Certified by Council Secretary ',^` By: gy: '� e� � T'� n —` - � � Approved by � City Att ��-/. for Sc � � �. � � oa- 8 �- Peter M. Klein, Port Peter M. Klein (651)224-5686 September 25, 2002 �� � xourwc o`mFn TOTAL � OF SIGNATURE PAGES GREEN SHEET ��z_� No 10� 347 �;;�_,-_. � �,.,�. � �«� _ ����� �����a ❑ rvat/aeumurt� ❑ (CLJP ALL LOCATIONS FOR SIGNATURE) Approval of the issuance of approximately $3,700,000 of conduit tax-exempt revenue bonds for Camada Limited Partnership (Vomela Specialty Company) for the refinancing and purchase of equipment of an office and production facility located across the river from Downtown Saint Paul, Minnesota. PL4NNING CAMMISSION CIB COMMITfEE CIVIL SERVICE CAMMISSION Port Authority � m� aaBOn�� � wo�rea �� a�r,�.t ra w�s a�rtme�rr YES P10 Has this De��rm aver been a citY empbyee9 YES NO Dces tlxs PeisaJfirtn G�esc a sldll nd namalryP� bY arry curreM citY empbyee? YES NO Ia this petswVfilm a taipeteC ventla'7 VES NO The issuance of th� bonds will allow for the refinancing and purchase of equipment at Vomela`s manufaciuring facility located in the Riverview Industrial Park in Saint Paul, Minnesota. As a result of the refinancing and equipment purchase, it is anticipated that 5-10 new jobs will be created witnin two years. IF APPROVED None The new jobs stimulated by the equipment purchase will not be created. �rwwsacnoNs 3.700 000 Port Authority conduit tax-exempt revenue hnnds �Nwkw.nod (exxaM cosrmEVer+ue suoe�o �anu.e onfl 1 G. ACTNTf NNABER YES NO it;_. / 7900LandmarkTowers Q O R T Te1:651-224-5686 07,���j. 345 St. Peter Street J � Q Fax:65t-223-5198 Saint Paul, Minnesota Q ,11� s Toll Free: 800-328-8417 55702-7667 °- � s wv✓wsppa.com r o Z a �y �Y September 17, 2002 Ms. Marsha Fuller, Director Planning & Economic Development Department 1300 City Haii Annex 25 West Fourth Street Saint Pauf, Minnesota 55102 RE: $3,700,000 CONDUIT TAX-EXEMPT REVENUE BOND ISSUE CAMADA LtMITED Pp� TNERSHIP (VOMELA SPEC{ALTY COMPANY) Dear,l�s-°Fu`Il��� ✓ We submit for your review and referral to the office of the Mayor, City Councii, and City Attorney's o�ce, details pertaining to the issuance of conduit tax- exempt revenue bonds in the approximate amount of $3,700,000 to refinance and purchase equipment for a manufacturing facility located in Saint Paul, Minnesota. The City of Saint Paul's entitlement allocation will not be affected by this application. In addition to the staff memorandum, we are attaching a draft copy of the proposed City Gouncil Resolution and a copy of the Resolution conducting the required public hearing and authorizing the sale of the tax-exempt revenue bonds in the amount of $3,700,000 that will be considered by the Port Authoritys Board on September 24, 2002. City Council action will be required after the Port Authority's Board meeting of September 24, 2002. Your expeditious handling of this mafter will be appreciated. � Since���� ----., Kenneth R.Johnson President KRJ:cp Attachment cc: Mayor Kelly 23860.1. SAINT PAUL PORT AUTHOKITY MEMORANDUM 'i'p; BOARD OF COMMISSIONERS (Regulaz Meeting September 24, 2002) DATE: oa.-3�a— September 17, 2002 FRQ1yL• PeterM. Klein�l/�-- Laurie J. Hansen Kenneth R. Johnson $U$JECT; CAMADA LIMITED PARTNERSHIP (VOMELA SPECIALTY COMPANY) Authorization of the Issuance of Conduit Variable Rate Tax-Exempt Sonds in the Approximate Amount of $3,700,000 Resolution No. Action Requested: Provide final approval for the Port Authority to issue approxnnately $3,700,000 of conduit variable rate ta�c-exempt bonds to be used for the refinancing of existing debt and the purchase of equipment for the facility located at 274 E. Fillmore Avenue. Public Purpose: The refinancing and the purchase of new equipment will allow Vomela to reduce its financing costs and will enhance its ability to provide livable wage manufacturing jobs in the community. Busutess Subsidv: The proposed issuance of bonds is exempt from treatment as a business subsidy since bonds for which allocation is required, or which are issued to refund outstanding bonds, are exempt under the statute. Back round: Vomela was founded in 1947 and has been under the current ownership since 1990. Sales ($35 million) and number of employees (300) have increased ten fold from 1990 through 2002. The company has developed a core competency in printing graphics on vinyl. Its largest revenue segment is producing gaphics for original equipment manufacturers of recreational vehicles, snowmobiles, ATVs and watercraft. Camada Limited Partnership, which is controlled by the owner of Vomela, is the owner of the real estate and leases it to Vomela. In 1995, the Port Authority approved a$1,SQ0,000 tax-exempt revenue note for the purchase of Vomela's current facility at 274 Fillmore. As part of this financing, the Port Authority provided a $30Q000 reserve out of the Business Development Fund. The 1995 note will be paid off and the reserve will be returned to the BDF upon the completion of this financing. 23812.1. ProPOSaI: � �`�� � Type of Notes: Variable Rate Demand Industrial Development Revenue Bonds. Rate: Initially, approximately 3.00°/o including the Letter of Credit (I.00) fee adjusting on a weekly basis. Security. Letter of Credit. The Letter of Credit Bank is secured by a first secured interest and mortgage on the Project, including the land, building and personal properiy associated with the Project. Term: Issuer: LOC Provider: Placement Agent: Bond Counsel: Borrower's Counsel: Placement Agent Counsel: Bank Counsel: Trustee: 7 Years Saint Paul Port Authority Wells Fargo Bank Mimiesota, NA Wells Fazgo Brokerage Services, LLC Leonard, Street and Deinard Winthrop & Weinstine Briggs & Morgan Gray Plant Mooty Wells Fargo Conduit Financin� The bonds will be a conduit financing of the Authority and will not constitute or give rise to a liability of the Authority, the City of Saint Paul ar the State of Minnesota or a charge against their general credit or taxing powers. The bondholders will not have the right to demand payment on the bonds out of any funds to be raised from taxarion or from any revenue sources other than those expressly pledged to payment of the bonds pursuant to the indenture. 'The Port Authority will receive fees in the amount of 1/8th of a point ($4,625.00) at inception and 1/8th of a point on the outstanding balance, annually, for the life of the bonds. Workforce Implications: Approximately 10 new jobs, at $12 per hour plus benefits, will be created. Policv Exceptions: None. Disclosure: The Port Authority Cominissioners by SEC rules aze obligated to disclose any risks or facts you may be awaze of that would affect the probability of repayment on these bonds. Recommendation: We recommend the final approval for the issuance of approximately $3,700,000 of conduit variable rate tas-exempt bonds. 23812.1. b � - Y`1 Resolution No. RESOLIJT`ION OF THE PORT AUTHORITY OF THE CTTY OF SAINT PAUL [Camada Limited Partnership] WHEREAS: l. It has been proposed that the Port Authority of the City of Saint Paul (the "Port Authority") issue its Variable Rate Demand Industrial Development Revenue Refunding Bonds (Camada Limited Parhiership Project) Series 2002-7 (the `Bonds") in an aggregate principal amount not to exceed $3,700,000 and that the proceeds of such Bonds be loaned to Camada Limited Partnership Project (the `Borrower'� to refund the $1,500,000 Development Revenue Note (Camada Limited Partnership Project) previously issued by the Port Authority to finance the acquisition by the Bonower of a building located at 274 Fillmore Avenue (the "Building") in the City of Saint Paul, Mimiesota (the "City"), which was to be owned by the Borrower and leased to Vomela Specialty Company for its use. In addition, proceeds from the sale of the Bonds will be loaned to the Borrower to finance the purchase and installation of equipment to be used in the Building. The refinancing of the Building and the Acquisition of the printing equipment to be used therein aze collecrively referred to herein as the "Project." 2. The Authority desires to facilitate the selective development of the City of Saint Paul and the metro east community, to retain and improve its taac base and to help it provide the range of services and employment opportunities required by its population, and the Project will assist in achieving that objective by increasing the assessed valuation of the metro east community; helping to maintain a positive relarionship between assessed valuarion and debt; and enhancing the image and reputation of the metro east community. The Project will result in addifional employment opportunities in the City of Saint Paul. 4. The Project and its financing has received an allocation of bonding authority from the State of Minnesota Depariment of Finance. 5. The Authority's Credit Committee and Board have previously adopted Resolution Nos. 47 and 3949, respectively, giving preliminary approval to the proposed issuance of revenue bonds. 6. Pursuant to the requirements of Sec6on 147(fl of the Internal Revenue Code of 1986, as amended, and pursuant to a notice published by the Por[ Authority not less than 15 days prior to the public hearing, a public hearing has been held on the issuance of the Bonds, at which public hearing all persons were given an opportunity to speak. 7. The Bonds will be issued and secured by the terms of an Indenture of Trust (the "Indenture") between the Port Authority and a qualified trustee (the "Trustee'� and will be payable primarily from draws made on an inevocable letter of credit issued by Wells Fargo Bank Minnesota, National Association (the `Bank") pursuant to a I,etter of Credit and Reimbursement 25498.'I. b a- �"'�'�- Agreement to be dated as of September 1, 2002 (the "I,etter of Credit AgreemenP') between the Bonower and the Bank. 8. The Borrower and the Port Authority will also enter into a L,oan Agreement (Yhe "Loan AgreemenP') in which the Borrower will agree to maintain the Letter of Credit and make all payments due either to the Bank or on account of the Bonds. 9. The Bonds and the interest on the Bonds shall be payable solely from the revenue pledged therefor and the Bonds shall not constitute a debt of the Port Authority within the meaning of any constiturional or statutory lunitation of indebtedness, nor shall the Bonds consritute nor give rise to a pecuniary liability of the Port Authority or the City or a chazge against their general credit or tasing powers and shall not constitute a chazge, lien or encumbrance, legal or equitable, upon any property of the Port Authority or the City other than their interest in said Proj ect. 10. It is intended that interest on the Bonds be excluded from gross income of the holders thereof far federal income tax purposes. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE PORT AUTHORTTY OF THE CTI'Y OF SAINT PAUL, AS FOLLOWS: A. On the basis of information available to the Port Authority it appears, and the Port Authority hereby finds, that: the Project constitutes properties, used or useful in connection with one or more revenue producing enterprises engaged in any business within the meaning of Minnesota Statutes, Sections 469152 to 469165 (the "Act"); the Project furthers the piuposes stated in the Act; and it is in the best interests of the port district and the people of the City of Saint Paul and in furtherance of the general plan of development to assist the Borrower in financing the Project. B. Por the purpose of financing the Project, and paying certain costs of issuance and other expenses in connection with the issuance of the Bonds, and provided that the Project and its financing receive approval by the Department of Trade and Economic Development ("DTED"), the Port Authority hereby authorizes the issuance, sale and delivery of the Bonds in an aggregate principal amount not to exceed $3,700,000. The Bonds shall bear interest at such rates, shall be numbered, shall be dated, shall mature, shall be subject to redemption prior to maturity, and shall be in such form and have such other details and provisions as may be prescribed in the Indenture, substantially in the form now on file in the offices of the Port Authority. C. Neither the Bonds, nor the interest thereon, shall consritute an indebtedness of the Port Authority or the City within the meaning of any constiturionai or statutory debt limitation; nor shall they constitute or give rise to a pecuniary liability of the City, the Port Authority or a charge against their general taYing powers and neither the fixll faith and credit nor the general taYing powers of the City or the Port Authority is pledged to the payment of the Bonds or interest thereon. D. Forms of the following documenis have been submitted to the Fort Authority for review and/or approval in connection with the sale, issuance and delivery of the Bonds: 2246027v1 Oz- �'"l�- 1. the Bond Placement Agreement to be entered into between the Port Authority, the Borrower, Wells Fazgo Brokerage Services, LLC (the "Placement Agent") (the `Bond Placement AgreemenY'); 2. the Indenture; 3. the Loan Agreement; 4. the Bonds; 5. the preliminary Placement Memorandum to be used in marketing the Bonds (the "Placement Memorandum"); 6. the Remarketing Agreement to be entered into by and between Wells Fargo Brokerage Services, LLC (the "Remazketing AgenY') and the Bonower (the "Remazketing AgreemenY'); and 7. the Reimbursement Ageement and form of the I,etter of Credit (collectively, the "Documents"). E. It is hereby found, determined and declared that: 1. The issuance and sale of the Bonds, the execution and delivery by the Port Authority of the Documents, as applicable, and the performance of all covenants and agreements of the Port Authority contained in the Documents, as applicable, and of all other acts and things required under the Consritution and laws of the State of Minnesota to make the Documents and the Bonds valid and binding obligations of the Port Authority in accordance with their terms, are authorized by Minnesota Statutes, Sections 469152 through 469.165, as amended (the "Act"); 2. It is desirable that the Bonds be issued by the Port Authority upon the general terms set forth in the Documents, as applicable; 3. Under the provisions of and as provided in the Documents, the Bonds are not to be payable from or a charge upon any funds other than the revenues pledged to the payment thereof; no holder of the Bonds shall ever have the right to compel any exercise by the City or the Port Authority of its taxing powers to pay the Bonds or the interest or premium thereon, or to enforce payment thereof against any property of the City or the Port Authority except the interests of the Port Authority and the City which have been pledged to the Trustee under the Indenture; the Bonds shail not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City or the Port Authority except the interests of the Port Authority and tl�e City which have been pledged to the Trustee under the Indenture; the Bonds shall each recite that they are issued without moral obligation on the part of the State or its political subdivisions, and that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment 2246027v1 OZ- 8"'�'�- thereof; and the Bonds shall not constitute a debt of the City or the Port Authority within the meaning of any constitutional or statutory limitation. F. The forms of the Documents and e�ibits thereto aze approved substantially in the forms submitted and on file in the offices of the Port Authority, with such subsequent changes as may be approved by Port Authority management and Bond Counsel as contempiated by paragraph H. The Chair and Secretary of the Port Authority, or such other officer as may be appropriate in the absence of either the Chair or Secretary, aze hereby authorized to execute the Documents (to the extent the Port Authority is a party thereto) in substantiaily the forms submitted, as modified pursuant to paragraph H, and any other documents and certificates which in the opnuon of Port Authority management and Bond Counsel are necessary to the transaction herein described The execurion of any instrument by the appropriate officer or officers of the Port Authority herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. The execution of any documents necessary for the transaction herein described by ntdividuals who were at the time of execution thereof the authorized officers of the Port Authority shall bind the Port Authority, notwithstanding that such individuals or any of them has ceased to hold such office or offices prior to the authentication and delivery of the Bonds. Copies of all of the documents necessary to the transaction described shall be delivered, filed and recorded as provided herein and in the Indenture. G. The Fresident and other officers of the Port Authority aze authorized and directed to prepare and fuinish to the Placement Agent and Bond Counsel certified copies of proceedings and records of the Port Authority relating to the issuance of the Bonds and other transactions herein contemplated, and such other affidavits and certificates as may be required to show the facts relating to the legality of the Bonds and the other transactions herein contemplated as such facts appeaz from the books and records in the officers' custody and control or as otherwise known to them; and all such certified copies, certificates and affidauits, including any heretofore furnished, shall constitute representations of t1�e Port Authority as to the truth of all statements contained therein. H. The approval hereby given to the various Documents refened to above includes approval of such addirional details therein as may be necessary and appropriate, and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by the Port Authority's President and Chief Financial Officer; and includes approval of, among other things: 1. establishment of the final principal amount of the Bonds and the interest rate to be borne thereby far the initial period, including the principal amount of the Bonds and the Bonds; provided that: (a) the masunum aggregate principal amount of the Bonds shall not exceed $3,700,000; (b) the maacimuxn principal amount of the Bonds which require allocafion from the State of Minnesota shall not exceed the amount of the allocation awazded; and (c) the that the maacimum interest rate on the Bonds shall not exceed 12% per asunun; 2. the establishment of the maturity schedule and call provisions to be applicable to the Bonds; and 2246027v1 o�- _ �a- 3. such related instruments as may be required to satisfy the conditions of any purchaser of the Bonds. L `The Port Authority hereby consents to the distribution of the Placement Memorandum, as such Placement Memorandum is finalized with the participarion of Port Authority management and Bond Counsel. The proposal of the Placement Agent to sell the Bonds upon the terms and condirions set forth in the Bond Placement Agreement is hereby found and detennined to be reasonable and is hereby accepted. J. The authority to approve, execute and deliver future amendments to financing documents entered into by the Port Authority in connection with the issuance of the Bonds and the other transactions herein contemplated, is hereby delegated to the President of the Port Authority, provided that: (a) such amendments either do not require the consent of the holders of the Bonds or, if required, the consent of the required percentage of the holders of the Bonds has been obtained with respect to such amendment; (b) such amendments do not materially adversely affect the interests of the Port Authority as the issuer of the Bonds; (c) such amendments do not contravene or violate any policy of the Port Authority; and (d) such amendments aze acceptable in form and substance to Bond Counsel. The execution of any instrument by the President of the Port Authority shall be conclusive evidence of the approval of such instruments in accordance with the terms hereof. K. No covenant, stipulation, obligation or agreement contained herein or in the Documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the Board of Commissioners of the Port Authority, or any officer, agent or employee of the Port Authority in that persons individual capacity, and neither the Board of Commissioners nor any officer executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountabiliry by reason of the issuance thereof. Adopted: September _ , 2002 PORT AUTHORTTY OF THE CITY QF SAINT PAUL By Its Chair ATTEST: By Its Secretary zza6oz��t