12-19-2007 Council Agenda - Laserfiche WebLink

Home Browse Search

resulting or transferee corporation or other business entity, as the case may be, is duly qualified to do business in Minnesota. Every surviving, resulting or transferee corporation and other entity referred to in this Section 4.2 shall be bound by all of the covenants and agreements of the Borrower herein with respect to any further consolidation, merger, sale or transfer. Section 4.3 Reports to Governmental Agencies. The Borrower will furnish to agencies of the State of Minnesota, such periodic reports or statements as are required under the Act, or as they may otherwise reasonably require of the City or the Borrower throughout the term of this Agreement in connection with the transaction contemplated herein. Copies of such reports will be provided to the City and the Lender. Section 4.4 Security for the Loan. As additional security for the Lender, and to induce the City to issue and deliver the Note, the Borrower agrees to execute and deliver the Mortgage, and the Security Agreement and agrees to meet all its obligations under the Mortgage, and the Security Agreement, which documents shall remain in effect until all payments required hereunder have been made; and the Borrower authorizes and directs the Lender to cause to be recorded and filed the Mortgage, financing statements and such other documents requested by Lender, in such places and in such manner as the Lender deems necessary or desirable to perfect or protect the security interest of the Lender in and to the Project and other collateral referred to in said documents. Section 4.5 Preservation of Tax Exemption. (1) The Borrower covenants and agrees that, in order to assure that the interest on the Note shall at all times be free from federal income taxation, the Borrower represents and covenants with the City and the Lender that it will comply with the applicable provisions of Section 103 and Sections 141 through 150 of the Code and as follows: (a) The Project is and will continue to be owned and operated by the Borrower and no portion of the Project is managed by anyone other than the Borrower. (b) The Project will not be used by the Borrower in an unrelated trade or business, determined by the application of Section 513(a) of the Code. (c) No more than five percent (5 %) of the net proceeds of the Note are to be used for any private business use as defined in Section 141(b)(6) of the Code. (d) The payment of the principal of, or interest on, no more than five percent (5 %) of the net proceeds of the Note is (under the terms of the Note or any underlying arrangement) directly or indirectly (a) secured by any interest in (i) property used or to be used for a private business use, or (ii) payments in respect of such property, or (b) to be derived from payments (whether or not to the City) in respect of property, or borrowed money, used or to be used for a private business use. (e) The weighted average maturity of the Note will not exceed the estimated economic life of the Project by more than twenty percent (20 %), all within the meaning of Section 147(b) of the Code. 2110583v4 12-31