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City Council Resolution 2026-84 (Issuance of Lease Revenue Bonds)CITY OF MONTICELLO COUNTY OF WRIGHT STATE OF MINNESOTA RESOLUTION NO.2026-84 RESOLUTION AUTHORIZING THE EXECUTION AND DELIVERY OF A GROUND LEASE AND A LEASE -PURCHASE AGREEMENT, AND APPROVING AND AUTHORIZING ISSUANCE OF LEASE REVENUE BONDS AND EXECUTION OF RELATED DOCUMENTS WHEREAS, the City of Monticello, Minnesota (the "City") is authorized by Minnesota Statutes, Section 465.71, as amended, to acquire real and personal property under lease -purchase agreements. WHEREAS, the City of Monticello Economic Development Authority (the "EDA") is authorized by Minnesota Statutes, Sections 469.090 to 469.1082, as amended (collectively, the "Act"), and specifically Section 469.103 thereof, to issue revenue bonds for any of its corporate purposes and to pledge thereto income and revenues of the EDA. WHEREAS, pursuant to the Act, the EDA has formed the Public Works Facility Economic Development District (the "Development District") and has adopted an Economic Development Program (the "Development Program") for the Development District which sets forth development objectives for the Development District. A stated objective of the Development District is to foster the development of adequate public facilities necessary to serve the Development District and the City as a whole. WHEREAS, the City has acquired certain property described on Exhibit A attached hereto (the "Property") located in the EDA's Development District. WHEREAS, the City and the EDA propose that pursuant to a Ground Lease dated as of October I, 2026 (the "Ground Lease"), the form of which is attached as Exhibit B, the EDA will acquire a leasehold interest in the Property (the "Leased Premises") from the City, and the EDA will lease such Leased Premises, together with the buildings, structures or improvements now or hereafter located thereon (consisting of the Site and the Facilities as defined therein), to the City pursuant to a Lease -Purchase Agreement dated as of October 1, 2026 (the "Lease"), the form of which is attached as Exhibit C. WHEREAS, pursuant to a Trust Indenture dated as of October 1, 2026 (the "Indenture") between the EDA and a trustee selected by the EDA or its designee (the "Trustee"), the form of which is attached as Exhibit D, the EDA will issue its Lease Revenue Bonds (City of Monticello, Minnesota Public Works Facility Lease), Series 2026A (the "Series 2026A Bonds") in a principal amount not to exceed $34,475,000. 4909-2324-0139.2 WHEREAS, under the Indenture, proceeds of the Series 2026A Bonds will be used to pay costs of acquisition, construction and equipping of a new public works building in the City (the "Facilities") and the Series 2026A Bonds will be secured by and payable from the lease payments under the Lease (the "Lease Payments"). WHEREAS, forms of the Ground Lease, the Lease, the Indenture and a Continuing Disclosure Certificate of the EDA and the City dated on or after October 1, 2026 (the "Continuing Disclosure Certificate"), the form of which is attached as Exhibit E, have been prepared and submitted to this Council and are on file with the City. NOW THEREFORE BE IT RESOLVED by the City Council (the "Council") of the City of Monticello, Minnesota (the "City"), as follows: Section 1. Findings. On the basis of information given 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 Ground Lease, the Lease, and the Continuing Disclosure Certificate. (b) the terms of the Ground Lease, the Lease, the Indenture, and the Continuing Disclosure Certificate are found to be advantageous to the City and the form and terms thereof are hereby approved. (c) the Site and the Facilities described in the Lease constitute government property necessary or desirable as a public works facility, and the City presently intends to appropriate all Lease Payments under the Lease for the term of the Lease; however, the obligations 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. Section 2. Authorization of Documents. The Ground Lease, the Lease, the Indenture, and the Continuing Disclosure Certificate, together with any other documents or certifications necessary in connection with the issuance of the Series 2026A Bonds are hereby approved (collectively, the "Financing Documents"). The Mayor and the City Administrator are authorized and directed to execute and deliver the Financing Documents to which the City is a party, 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, in consultation with the City Administrator, which approval shall be conclusively evidenced by the execution thereof by the Mayor and the City Administrator. Copies of all of the Financing Documents shall be delivered, filed and recorded as provided therein. The Mayor and the City Administrator of the City are also authorized and directed to execute such other instruments as may be required to give effect to the transactions herein contemplated. 2 4909-2324-0139.2 Section 3. Official Statement. In connection with the sale of the Series 2026A Bonds, the officers or employees of the City are authorized and directed to cooperate with the Northland Securities, Inc., and participate in the preparation of an official statement for the Series 2026A Bonds (the "Official Statement") and to deliver it on behalf of the EDA upon its completion. The Official Statement, as completed and supplemented, and its distribution to potential purchasers of the Series 2026A Bonds, are hereby approved. The Mayor and the City Administrator are authorized and directed to certify that they have examined the Official Statement prepared and circulated in connection with the issuance and sale of the Series 2026A Bonds and that to the best of their knowledge and belief the Official Statement is a complete and accurate representation of the facts and representations made therein as of the date of the Official Statement. Section 4. Continuing Disclosure. The City hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate. Notwithstanding any other provision of this Resolution, failure of the City to comply with the Continuing Disclosure Certificate is not to be considered an event of default with respect to the Series 2026A Bonds; however, any bondholder may take such actions as may be necessary and appropriate, including seeking a mandate or specific performance by court order, to cause the City to comply with its obligations under this section. Section 5. Approval of Issuance and Sale of Series 2026A Bonds. The issuance and sale by the EDA of the Series 2026A Bonds at the price, par amount, and interest rates to be set forth in the Indenture are hereby approved in all respects. In accordance with the Lease, the City will pay, from proceeds of the Series 2026A Bonds or from other City funds, the costs of construction of the Facilities and the costs of issuance of the Series 2026A Bonds. The City hereby authorizes and requests that the EDA issue the Series 2026A Bonds in accordance with the terms of a resolution of the Board of Commissioners of the EDA and as further set forth in the Indenture. Section 6. Payment of Lease Payments. The City will pay to the Trustee, 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, 2026, 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. Section 7. Miscellaneous. 7.01. Not Arbitrage Bonds. The City covenants and agrees with the holders from time to time of the Series 2026A Bonds that the investment of proceeds of the Series 2026A Bonds, 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 Series 2026A Bonds shall not be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended (the "Code"), and applicable regulations thereunder (the "Regulations"), and that the City shall comply with all other applicable requirements of Section 148. On the basis of the existing facts, estimates and 3 4909-2324-0139.2 circumstances, including the foregoing findings and covenants, the City hereby certifies that it is not expected that the proceeds of the Series 2026A Bonds will be used in such manner as to cause the Series 2026A Bonds to be "arbitrage bonds" under Section 148 of the Code and the Regulations. 7.02. Not Private Activity Bonds. No action shall be taken or authorized to be taken in connection with the application or investment of the proceeds of the Series 2026A Bonds which would cause the Series 2026A Bonds to be or become "private activity bonds" within the meaning of Section 141 of the Code and the applicable Regulations. The City shall take all such actions as may be required under the Code and applicable Regulations to ensure that interest on the Series 2026A Bonds is not includable in gross income for federal income tax purposes. The Site, the Facilities, and the proceeds of the Series 2026A Bonds will likewise be used in such manner that the Series 2026A Bonds will not be "private activity bonds" under Section 141 of the Code and the Regulations. 7.03. 8038. The City covenants that it will file (or cause the EDA to file) with the Internal Revenue Service the information required under Section 149(e) of the Code. 7.04. Definitions. Capitalized terms used herein and not otherwise defined herein have the meanings given in the Lease or the Indenture. 7.05. Electronic Signatures. The electronic signature of the Mayor and the City Administrator to this resolution and to any certificate authorized to be executed hereunder shall be as valid as an original signature of such party and shall be effective to bind the City thereto. For purposes hereof, (1) "electronic signature" means a manually signed original signature that is then transmitted by electronic means; and (ii) "transmitted by electronic means" means sent in the form of a facsimile or sent via the internet as a portable document format ("pdf') or other replicating image attached to an electronic mail or internet message. 7.06. Bond Transcript. The officers of the City are authorized and directed to prepare and furnish to the original purchaser of the Series 2026A Bonds, and to the attorneys approving the Series 2026A Bonds, certified copies of all proceedings and records of the City relating to the power and authority of the City to enter into the Financing Documents 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. Approved by the City Council of the City of Monticello this 9' day of September, 2026. Mayor ATTEST: Cij Clerk U U 4 4909-2324-0139.2 4909-2324-0139.2 EXHIBIT A DESCRIPTION The property to be replatted as Lot 2, Block 1, Redford Crossing, Monticello, Minnesota. A-1 4909-2324-0139.2 EXHIBIT B FORM OF GROUND LEASE IKE 4909-2324-0139.2 EXHIBIT C FORM OF LEASE -PURCHASE AGREEMENT C-1 4909-2324-0139.2 EXHIBIT D FORM OF TRUST INDENTURE D-1 4909-2324-0139.2 EXHIBIT E FORM OF CONTINUING DISCLOSURE CERTIFICATE E-1 4909-2324-0139.2