Resolution 3412 - Issuance and Sale of Revenue Bonds, Outlaw Inn Project1, �,. . -, �
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RESOLUTION NO. 3412
.A RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF
REVENUE BONDS PURSUANT TO PART 1 OF CHAPTER 5
OF TITLE 90, MONTANA CODE ANNOTATED 1981, TO PROVIDE
FUNDS TO BE LOANED TO OUTLAW INN FOR
INDUSTRIAL DEVELOPMENT PROJECT
BE IT RESOLVED by the City Council of the City of
Kalispell, Montana, as follows:
1. Authoritz. The City is, by the Constitution,and
Laws of the State of Montana, including Part 1 of Chapter 5 of
Title 90, Montana Code Annotated 1981, as amended (the "Act")
authorized to issue and sell its revenue bonds for the purpose of
financing the cost of construction of authorized projects and to
enter into contracts necessary or convenient in the exercise of
the powers granted by the Act and to pledge revenues of the
project and otherwise secure the bonds.
2. Authorization of Series of Bonds. The Citv Council
hereby determines that it is necessary and expedient to autho-
rize, and the City Council does hereby authorize, the issuance of
revenue bonds of the city in the aggregate principal amount of
Two Million Nine Hundred Thousand Dollars ($2,900,000) pursuant
to the Act to provide money to be loaned to Outlaw Inn, a Montana
joint venture (the "Borrower") to finance costs of acquiring real
estate and constructing and equipping an addition (the "Project
Building") to an existing motel -convention facility (the "Exist-
ing Facilities") in the City (the "Project"). In order to
provide financing for the Project, the City shall issue and sell
its $2,900,000 City of Kalispell, Montana Industrial Development
Revenue Mortgage Note (Outlaw Inn Project) (the "Note").
3. Documents Presented. Forms of the following docu-
ments relating to the Note and the Project have been submitted to
and examined by the City Council and are now on file in the
office of the City Clerk:
(a) Loan and Purchase Agreement (the "Loan Agree-
ment"), dated as of July 1, 1982, by and among the
City, the Borrower and The First Northwestern National
Bank of Kalispell (the "Bank") whereby, among other
things, the City agrees to sell and the Bank agrees to
purchase the Note, the City agrees to make a loan to
the Borrower of the proceeds of the sale of the Note
and the Borrower covenants to complete the Project and
to pay amounts sufficient to provide.for the prompt
Payment of the principal of and interest on.the Note;
(W Combination Mortgage, Security Agreement and
Fixture Financing Statement (the "Mortgage") dated a
of July 1, 1982, by atid between the'Borrower and thes
Banki whereby the Borrower mortgages the Project Site,
the Project Building and the Project Equipment (t he
"Project Facilities") and:the Existing Facilities as
security for the Note (this document not to be executed
bythe City);
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(c) Assignment and Pledge Agreement (the "Assign-
ment") dated as of July 1, 1982, whereby the City
assigns to the Bank all of its interest in the Loan
Agreement and Loan Repayments of the Borrower there-
under (except its rights under Sections 5.02, 7.01,
8.04 and 8.05), for the purpose of securing the Note;
(d) Escrow Agreement (the "Escrow Agreement")
dated as of July 1, 1982 by and among the Municipality,
the Bank and the Borrower whereby the Bank, acting as
Escrow Agent, will disburse the proceeds of the Note;
(e) The Disbursing Agreement (the "Disbursing
Agreement") dated July 1, 1982 between the Bank and
Title Insurance Company of Minnesota, whereby the
Disbursing Agent will disburse the disbursements to be
made by the Bank as Escrow Agent (this document not to
be executed by the City); and
(f) Assignment of Rents and Leases (the "Lease
Assignment") dated July 1, 1982, from the Borrower to
the Bank assigning to the Bank the Borrower's interest
in the rents and leases of the Project as additional
security for the Note (this document not to be executed
by the City); and
(g) The Guaranty Agreement (the "Guaranty Agree-
ment") dated July 1, 1982 from Richard Dasen, Ronald W.
Torstenson, Daniel P. Lambros, George P. Lambros,
Leonard A. Hamilton, Bonnie R. Hamilton, George R. Pew,
Robert L. Delaney, Donald L. Delaney, Ella M. Delaney
and William R. Blair (the "Guarantors") to the Bank
whereby the Guarantors have guaranteed the principal
of, premium, if any, and interest on the Note to the
extent provided therein (this document not to be
executed by the City).
4. Findings. It is hereby found, determined and
declared that:
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(a) The Project, as described in the Loan Agree-
ment, constitutes a project authorized by and described
in -Section 90-5-101 of the Act.
(b) The purpose of the Project is and the effect
thereof will be to promote the public welfare by:
encouraging the location and retention of a significant
commercial facility within the Municipality, thereby
increasing the development and use of the available
resources of the Municipality and the State of Montana,
improving employment opportunities of present and
future residents of the Municipality and increasing and
providing a better balanced tax base from which essen-
tial governmental services may be funded, all in the
public interest.
(c) The Project has been approved by preliminary
resolution ithe "Preliminary Resolution") of the
Council duly adopted after a public hearing thereon,
-duly called and held on November 2, 1981.
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(d) The Preliminary Resolution has been amended
to increase the authorized principal amount of the Note
from $2,800,000 to $2,900,000 to reflect an increase in
project costs and is hereby confirmed as amended.
(e) The issuance and sale of the Note, the execu-
tion and delivery of the Loan Agreement, the Escrow
Agreement.and the Assignment and the performance of all
covenants and agreements of the City contained in the
Note, the Loan Agreement, the Escrow Agreement and the
Assignment and of all other acts and things required
under the Constitution and laws of the State of Montana
to make the Note, Loan Agreement, the Escrow Agreement
and the Assignment valid and binding obligations of the
City in accordance with their terms, are authorized by
the Act.
(f) There is no litigation pending or, to the
best of its knowledge, threatened against the City
relating to the Project or to the Note, the Escrow
Agreement or Loan Agreement, or questioning the organi-
zation of the City or its power or authority to issue
the Note or execute and deliver the Loan Agreement, the
Escrow Agreement and the Assignment.
(g) The execution and delivery of and performance
of the City's obligations under the Note, the.Loan
Agreement, the Escrow Agreement and the Assignment have
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been fully authorized by all requisite action and do
not and will not violate any law, any order of any
court or other agency of government, or any indenture,
agreement or other instrument to which the City is a
party or by which it or any of its property is bound,
or be in conflict with, result in a breach of, or
constitute (with due notice or lapse of time or both) a
default under any such indenture, agreement or other
instrument.
(h) The Loan Agreement provides for payments by.
the Borrower to the Holder of the Note for the account
of the City of such amounts as will be sufficient to
pay the principal of, premium, if any, and interest on
the Note when due. No reserve funds are deemed necessary
for this purpose. The Loan Agreement obligates the
Borrower to'provide for the operation and maintenance
of the Project Facilities, including adequate insurance,
taxes and special assessments.
(i) Under the provisions of Section 90-5-103 of
the Act, the Note shall recite that the Note is a
limited obligation of the City, not to be payable from
nor charged upon any funds other than amounts payable
by the Borrower pursuant to the Loan Agreement which
are pledged to the payment thereof, and moneys derived
from foreclosure or other enforcement of the Mortgage,
Lease Assignment, the Escrow Agreement or the Guaranty
Agreement; the City is not subject to any liability
thereon; no Holder of the Note shall ever have the
right to compel the -exercise of the taxing power of the
City to pay the Note or the interest thereon, nor to
enforce payment thereof against. any property of the
City; the Note shall not constitute a charge, lien or
encumbrance, legal or equitable, upon the general
credit or any property of the City; and such Note does
not constitute an indebtedness of the City within the
meaning of any constitutional or statutory limitation.
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(j) No member of the City Council W has a
direct or indirect inLeres'L Lci Lile P�_4)ic-CL, Lhe Loan
Agreement, the Escrow Agreement,ithe Assignment or
Note, (ii) owns any capital stock of or other interest
in the Project or the Bank, (iii) will be involved in
supervising the completion of the Project on behalf of
the Borrower, or (v) will receive any commission, bonus
or other remuneration for or in respect of the Project,
the Escrow Agreement, the Loan Agreement or the Note.
5. Ap2roval and Execution of Documents. The forms of
Mortgage, Loan Agreement, Lease Assignment, the Escrow Agreement,
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the Disbursing Agreement, Guaranty Agreement and Assignment
referred to in paragraph 3 are approved. The Loan Agreement, the
Escrow Agreement and Assignment shall be executed in the name and
on behalf of the City by the Mayor and the City Clerk, in substan-
tially the form on file, but with all such changes therein, not
inconsistent with the Act or other law, as may be approved by the
Mayor, City Clerk or City Attorney, which approval shall be
conclusively evidenced by the execution thereof. The Mortgage,
Lease Assignment, Escrow Agreement, Disbursing Agreement and
Guaranty Agreement may contain such revisions as may be approved
by the Bank, the Guarantors or the Borrower, as the case may be.
6. Approval of Terms and Sale of Note. The City shall
proceed forthwith to issue its City of Kalispell., Montana Indus-
trial Development Revenue Mortgage Note (Outlaw Inn Project), in
the authorized principal amount of $2,900,000 substantially in
the form, maturing, bearing interest, payable in the installments
and otherwise containing the provisions set forth in the form of
Note attached hereto as Exhibit 1, which terms and provisions are
hereby approved and incorporated in this Note Resolution and made
a part hereof.
A single Note, substantially in the form of Exhibit.1
to this Note Resolution, shall be issued and delivered to the
Bank in the authorized principal amount of $2,900,000 and as
authorized by the Act, principal of and interest on the Note
shall be payable at the office of the Bank in Kalispell, Montana.
The proposal of the Bank to purchase such Note at a price of
$2,900,000 (100% of par value) is hereby found and determined to
be reasonable and is hereby accepted. Pursuant to the Loan
Agreement the Bank has agreed to pay the purchase price of the
Note to provide funds to be loaned by the City to the Borrower to
pay Project Costs, as defined in the Loan Agreement, then due or
reimburse the Borrower for Project Costs paid by the Borrower.
7. Execution, Deliveryand Endorsement of Note. The
Note may be in typewritten or printed form and shall be executed
by the manual signatures of the Mayor and City Clerk and the
official seal of the City shall be affixed thereto and attested
by the City Clerk. When so prepared and executed, the Note shall
be delivered to the Bank upon payment of the purchase price, and
upon receipt of the signed legal opinion of Faegre & Benson, of
Minneapolis, Minnesota, bond counsel, pursuant to the Loan
Agreement. The Note shall contain a recital that it is issued
pursuant to the Act, and such recital shall be conclusive evi-
dence of the validity and regularity of the issuance thereof.
8. Registration Records. The City Clerk, as bond
registrar, shall keep a bond register in which the City shall
provide for the registration of the Note and for transfers of the
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Note. The principal of and interest on the Note shall be paid to
the Bank for the account of the Holder entitled thereto in
Federal or other immediately available funds The City Clerk is
authorized and directed to deliver a certifi;d copy of this Note
Resolution to the securities commissioner of the State of Montana,
together with such other information as the securities commission-
er may require pursuant to Section 90-5-103 of the Act.
9. Mutilated, Lost, Stolen orDestroyed Note. If the
Note is mutilated, lost, stolen or destroyed, the City may
execute and deliver to the Holder a new Note of like amount,
date, number and tenor as that mutilated, lost, stolen or destroy-
ed; provided that, in the case of mutilation, the mutilated Note
shall first be surrendered to the City, and in the case of a .
lost, stolen or destroyed Note, there shall be first furnished to
the City and the Borrower evidence of such loss, theft or destruc-
tion satisfactory to the City and the Borrower, together with
indemnity satisfactory to them. The City and Borrower may charge
the Holder with their reasonable fees and expenses in replacing
any.mutilated, lost, stolen or destroyed.Note.
10. Transfer of Note; Person Treated as Holder. The
Note shall be transferable by the Holder on the bond register of
the City, upon presentation of the Note for notation of such
transfer thereon at the office of the City Clerk, as bond regis-
trar, accompanied by a written instrument of transfer in form
satisfactory to the City Clerk and the City Attorney, duly exe-
cuted by the Holder or its attorney duly authorized in writing.
The Holder seeking to transfer ownership of the Note shall also
give written notice thereof to the Borrower. The Note shall
continue to be subject to successive transfers at the option of
the Holder of the Note. No service charge shall be made for any
such transfer, but the City Clerk may require payment of a sum
sufficient to cover any tax or other governmental charge payable
in connection therewith. The person in whose name the Note shall
be issued or, if transferred, shall be registered from time to
time shall be deemed and regarded as the absolute Holder thereof
for all purposes, and payment of or on account of the principal
of, premium, if any, and -interest on the Note shall be made only
to or upon the order of the Holder thereof, or its attorney duly
authorized in writing, and neither the City, the City Clerk, the
Borrower, nor the Bank shall be affected by any notice to the
contrary. All such payments shall be valid and effectual to
satisfy and discharge the liability upon the Note to the extent
of the sum or sums so paid. The Note shall be initially register-
ed in the name of the Bank.
11. Amendments, Changes and Modifications to Loan
Agreement, Assignment, Escrow Agreement and Note Resolution.
Except pursuant to Section 9.03 of the Loan Agreement, the City
shall not enter into or make any change, modification, alteration
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or termination of the Loan Agreement, Assignment, the Escrow
Agreement or this Note Resolution.
.. 12. Pledge to Holder. Pursuant to the Assignment, the
City shall pledge and assign to the Bank and its successor
Holders of the Note all interest of the City in the revenues of
the Project Facilities, including all Loan'Repayments to be made
by the Borrower under the Loan Agreemeht'and moneys derived from
enforcement of the Mortgage, Escrow Agreement, Lease Assignment
and Guaranty Agreement. All collections of moneys,by'the City in
any proceeding for enforcement -of the obligations . of the Borrower
under the Loan Agreement shall be received, held and applied by
the City for the benefit of the Holder of the Note.
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13. Covenants with Holders; Enforceability. All pro-
visions of the Note and of this Note Resolution and all repre-
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C3%--.LJL CX ans an undertakings by the City in tne Loan Agreement are
hereby declared to be covenants between the City and the Bank and
its successor Holders of the Note and shall be enforceable by the
Bank or any Holder in a proceeding brought for that purpose.
14. Definitions.and Interpretation. Terms not other-
wise defined in this Note Resolution but defined in the Loan
Agreement shall have the same meanings in this Note Resolution
and shall be interpreted herein as provided therein. Notices may
be given as provided in Section 9.01 of the Loan Agreement. In
case any provision of this Note Resolution is for any reason
illegal or invalid or inoperable, such illegality or invalidity
or inoperability shall not affect the remaining provisions of
this Note Resolution, which shall be construed or enforced as if
such illegal or invalid or inoperable provision were not con-
tained herein.
15. City's Election. The City hereby elects that the
$10 million limitation of capital expenditures set forth in
Section 103(b)(6)(D) of the Internal Revenue Code shall be
applicable to the Project and the Note and the City Clerk shall
execute and file on behalf of the City the form of election
required by said Section 103(b)(6)(D) and the regulations there-
under.
16. Certifications. The Mayc
officers of the City are authorized and
furnish to Faegre & Benson, bond counse'
to the Borrower, to the Bank and to coui
the Guarantors, certified copies of all
of the City relating to the Project and
affidavits and certificates as may be r(
appearing from the books and records in
control or as otherwise known to them; i
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copies, certificates and affidavits, in(
furnished, shall constitute representat:
truth of all statements contained there:
Attest:
City ClArk
"T
Si
'f., the undersigned, City Clerk of the City of Kalispell
[�Opy of the Resoliition passed IX the City Council of thi
1.1(�gular meeting held zz
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r, City Clerk and other
directed to prepare and
and counsel to the Bank,
sel for the Borrower and
proceedings and records
the Note, and such other
quired to show the facts
the officers' custody and
nd all such certified
:luding any heretofore
.ons of the City as to the
.n.
,ertify that the -foregoing is a true
.City of Kalispell, Montana at a
Ci
of the City
EXHIBIT 1
TO
NOTE RESOLUTION #3412
(Form of Note)
UNITED STATES Of AMERICA
STATE OF MONTANA
COUNTY OF FLATHEAD
CITY OF KALISPELL
Industrial Development Revenue Mortgage Note
(Outlaw Inn Project)
No. R-1 $2,900,000
The City of Kalispell, a municipal corporation in the
County of Flathead and State of Montana (the "City"), for value
received, hereby promises to pay, but solely from the source and
in the manner hereinafter provided, to The First Northwestern National
Bank of Kalispell (the "Bank") or registered assigns the princi-
pal sum of Two Million Nine Hundred Thousand Dollars (11e�2,900,000),
on July 1. 1998, upon the presentation and surrender hereof, and
to make repayments of said principal sum in installments as
hereinafter provided, and to pay to the owner hereof interest on
the outstanding and unpaid balance of such principal sum from the
date hereof until said principal sum is paid, at a rate which
shall be 14.0% per annum until Loan Year Six; as defined in the
Loan Agreement herein-fter mentioned, whereupon the interest rate
shall be adjusted as provided below (the "Adjusted Rate") to be
not less than 10.0% per annum nor more than 18.0% per annum
(rounded off to the closest five-one-hundreths of 1.0%). The
Adjusted Interest Rate shall be adjusted on each anniversary of
the loan commencing with Loan Year Six; and shall equal the
maximum average weekly interest rate on U.S. Treasury Notes -
State and Local Government Series, maturing five years subsequent
to the anniversary date at which time the adjustment is made, for
the four (4) weeks immediately preceding such anniversary. The
first twelve Loan Repayments, commencing on August 1, 1982 shall
be applied to accrued but unpaid interest on the Note, and
subsequent Loan Repayments shall be applied to unpaid principal
and interest of the Note. Principal and interest shall be paid
to the registered holder hereof in lawful money of the United
States at the office of the the Bank, in Kalispell, Montana.
This Note is issued pursuant to Part 1 of Chapter 5 of
Title 90, Montana Code Annotated 1981, and in conformity with the
provisions, restrictions and limitations thereof. This Note does
not constitute a charge against the general credit, property or
taxing powers of the City and does not grant to the owner or
holder of this Note any right to have the City levy any taxes or
appropriate any funds for the payment of the principal hereof or
interest hereon, nor is this Note a general.obligation of the
City or an obligation of the individual ' officers or agents
thereof. This Mote and interest hereon are payable solely and -
only from the moneys received under the Loan Agreement herein-
after mentioned, including loan repayments to be made by Outlaw
Inn (the "Borrower") and from enforcement of the Mortgage, Lease
Assignment and Guaranty Agreement hereinafter mentioned.
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This Note represonts ar. au 4- horize�-1 2ej:- c_s of S
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obligation Notes of an aggregate p'rincip'al amount of $2,900,000,
which have been authorized by law to be�issued and have been
issued for the purpose of funding a loan: from the City to the
Borrower to finance costs of acquiring real estate and construct-
.ing and equipping an addition (the "Project Building") to an
existing motel -convention facility (the "Existing Facilities") in
the City to be owned by the Borrower (the "Project"). This Note
is issued pursuant to a Loan and Purchase Agreement (the "Loan
Agreement") by and among the City, the Borrower and the Bank,
dated as of July 1, 1982, and a Note Resolution of the City duly
adopted June 21, 1982. Pursuant to an Assignment and Pledge
Agreement dated as of July 1, 1982 (the "Assignment"), the City
has assigned its interest in the Loan Agreement (except its
rights under Sections 5.02, 7.01, 8.04 and 8.05 thereof) to the
Bank. This Note is secured by the Loan Agreement, the Assign-
ment, the Note Resolution, a Combination Mortgage, Security
Agreement and Fixture Financing Statement (the "Mortgage") by the
Borrower to the Bank dated as of July 1, 1982, an Assignment of
Rents and Leases (the "Lease Assignment") by the Borrower to the
Bank dated as of July 1, 1982, a Guaranty Agreement (the
"Guaranty Agreement") from Richard Dasen, Ronald W. Torstenson,
Daniel P. Lambros, George P. Lambros, Leonard A. Hamilton, Bonnie
R. Hamilton, George R. Pew, Robert L. Delaney, Donald L. Delaney,
Ella M. Delaney and William R. Blair (the "Guarantors") to the
Bank dated as of July 1, 1982.and an Escrow Agreement (the
WoEscrow Agreement") by and among the City, the Bank and the
Borrower dated as of July 1, 1982, to which Loan Agreement,
Assignment, Note Resolution, Mortgage, Lease Assignment, Escrow
Agreement and Guaranty Agreement and amendments thereof reference
is hereby made for a description and limitation of the revenues
and funds pledged and appropriated to the payment of the Note,
the nature and extent of the security thereby created, the rights
of the Holder of the Note, the rights, duties aftd immunities of
the Bank and the rights, immunities and obligations of the City
thereunder. Certified copies of the Note Resolution and executed
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counterparts of the Loan Agreement, the Assignment, the Mortgage,
the Lease Assignment, the Escrow Agreement and the Guaranty
Agreement are on file at the office of the City Clerk. This Note
shall be -subject to prepayment on any installment payment date
commencing in Loan Year Six at the option of the City, at the
request of the Borrower, in whole or in part upon payment to the
Bank of the principal amount of the Note to be prepaid plus
accrued interest plus a premium of 3.0% of the principal amount
prepaid if prepayment is made in Loan Years Six through Ten
inclusive as defined in Section 5.05 of the Loan Agreement.
However, the Borrower shall have the option to prepay the loan in
whole or in part, on any installment payment date, without
prepayment penalty, during such period if the Adjusted Interest
Rate exceeds 11.0% lunless a Determination of Taxability has
occurred and is continuing). In addition, the Borrower may
prepay the loan, in whole or in part, on any installment payment
date, without prepayment penalty, upon payment of the principal
amount to be prepaid plus accrued interest on the first day of
Loan Year Eleven and thereafter. Such prepayments shall be
applied on the last maturing required installment or installments
of principAl-in inverse order of their maturity.
This Note be Subject t,) mandatory redemption en
the first day of Loan Year Eleven at a price equal to the princi-
pal amount hereof then outstanding plus accrued interest to the
redemption date, unless at least 180 days prior to the redemption
date such mandatory redemption shall be waived in writing by the
Holder hereof, in which event this Note shall remain outstanding
and monthly installments hereunder shall continue to be payable
as provided herein, but if on or before the redemption date, the
Holder hereof and the Borrower shall agree in writing to any
changes in the terms or provisions hereof, including the interest
rate hereon and the amount of the monthly installments subse-
quently due hereunder, and all such changes shall be approved by
a resolution duly adopted by the City Council of the City prior
to the redemption date, this Note shall remain outstanding there-
after and be subject to such modified terms and provisions. In
the event, however, that no such modifications are so approved
and the Holder nevertheless duly waives in writing the mandatory
redemption in full of this Note at least 180 days prior to the
redemption date,this Note shall remain outstanding and be
payable in the amounts and on the dates as provided herein to and
until its stated maturity.
Notwithstanding.anything herein to the contrary, if a
Determination of Taxability (as defined in the Loan Agreement)
shall be made, the Borrower shall have the option of either: (i)
immediate prepayment of the entire outstanding balance of the
loan at a price of par and accrued interest pLus a penalty of
3.0% of the amount to be prepaid, if the Determination of Tax-
ability occurs during Loan Years One through Ten, inclusive, and
the interest rate is 14.0% or less pli�s.a penalty equal to the
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difference in interest which would have accrued if the interest
rate on the loan had been 3.0% above the Average New York City
Bank Prime Rate (as defined in the Loan Agreement) prevailing
during such period during which the interest on the Note was'
deemed to have been taxable; or (ii) conversion of the interest
rate on the loan for the full remaining loan term to a variable
rate, which from the date on which interest was determined to
have been taxable, equals the greater of 14.0% or 3.0% in excess
of the Average New York City Bank Prime Rate and upon such
Determination of Taxability and the Borrower shall forthwith pay
to the Bank or the Holder hereof as additional interest the
difference between the amount of interest actually paid from the
Date of Taxability and the amount that would have been paid if
such higher rate had been in effect from the Date of Taxability
and thereafter, the Borrower shall pay to the Bank or the Holder
such increased installments of principal and interest as are
necessary to amortize the then outstanding principal balance and.
interest thereon at such higher rate of interest for the remain-
ing maturity of this Note.
Notice of any such prepayment shall be given to the
owner or registered assigns of the Note by certified or regis-
tered mail, addressed to him at his registered address, not less
than thirty (30) days prior to the date fixed for prepayment, and
shall be published, if required by law, in a financial journal
circulated in the English language in the cities of Minneapolis,
and St. Paul, Minnesota at least once, not less than thirty (30)
days beforethe date so fixed for prepayment. At the date fixed
for prepayment, funds shall be paid to the owner hereof at the
office of the Bank or shall be deposited with the Bank, suffi-
cient to pay the Note, or_the principal amount thereof to be
prepaid, accrued interest thereon and premium, if any. Upon the
happening of the above,conditions, the Note thus called or the
principal portions thereof prepaid shall not bear interest after
the date specified for prepayment.
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This Note is transferable, as providcd ir. the llc t
Resolution, only upon the bond register of the City Clerk, as
bond registrar, by the owner hereof in person or by his duly
authorized attorney, as provided in the Note Resolution.
In case an Event of Defauit as defined in the Loan
Agreement occurs, this Note and the Loan Repayments thereafter to
become due under the Loan Agreement may become immediately due
and payable, in the manner and with the effect and subject to the
conditions provided in the Loan Agreement. The Holder of this
Note shall have the right to enforce the provisions of the Note
Resolution, Loan Agreement, Lease Assignment, Assignment, the
Guaranty Agreement and Mortgage.
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The terms and provisions of the Note Resolution, Loan
Agreement, Assignment, Lease Assignment, Guaranty Agreement,
Escrow Agreement and Mortgage, or of any instrument supplemental
theretop-may be modified or altered pursuant to Section 9.03 of
the Loan Agreement and paragraph 11 of the Note Resolution.
It is hereby certified and recited and the City Council
has found: That the Project is an eligible "project" defined in
Section 90-5-101 of the Act; that the issuance of the Note and
the acquisition and construction of the Project -will promote the
public welfare and carry out the purposes of the Act; that all
acts, conditions and things required to be done precedent to and
in the issuance of this Note have been properly done, have
happened and have been performed in regular and due time, form
and manner as required by law; and that this Note does not
constitute a debt of the City within the meaning of any con-
stitutional or statutory limitation.
IN WITNESS WHEREOF, the City of'Kalispell, by its City
Council, has caused this Note to be signed in its behalf by the
manual signatures of the Mayor and the City Clerk and sealed with
the corporate seal City attested by the City Clerk, all as
of the _4LL day of 1982.
. ATTEST:
City C rk
t
CITY OF KALISPELL
, %fi
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roarmalZmao
FUN
(SEAL)
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EXHIBIT 2
TO NOTE RESOLUTION #3412
ASSIGNMENT AND PLEDGE AGREEMENT
This Assignment is made as of the first day of July,
between the CITY OF KALISPELL, MONTANA, a municipal corporation
in the County of Flathead and State of Montana (herein called the
"City") and THE FIRST NORTHWESTERN NATIONAL BANK OF KALISPELL
(herein called the "Bank").
Recitals
The City has executed and delivered to the Bank its
single fully registered Industrial Development Revenue Mortgage,
Note (Outlaw Inn Project) in the principal amount of $2,900,000
dated the date of delivery, issued pursuant to a resolution
adopted June 21, 1982 (the "Note Resolution").
The proceeds of the Note have been or are to be loaned
to Outlaw Inn, a Montana joint venture (the "Borrower"), pursuant
to a Loan and Purchase Agreement dated as of July 1, 1982, among
the City, the Bank and the Borrower.
The Note is payable from and secured by the Loan Repay-
ments to be made by the Borrower under the Loan Agreement and the
Noteholder, as a condition to the purchase of the Note, has
required the execution of this Assignment.
ACCORDINGLY, as authorized by the Note Resolution and
in consideration of the premises and other good and valuable
consideration, the receipt of which is hereby acknowledged, the
City does hereby grant, transfer and assign to the Bank and its
registered assigns of the Note, all of the right, title and
interest of the City in the Loan and Purchase Agreement and the
Loan Repayments of the Borrower payable thereunder (except for
the righ�_s of the City under Sections 5.02, 7.01, 8.04 and 8.05
thereof relating to expensest indemnity and advances of the
City), all for the purpose of securing the Note.
IN WITNESS WHEREOF, the City has executed this Assign-
ment as of the date first above written, but actually on the
day of July, 1982.
CITY OF KALISPELL
Attest
?-Jity CXhrk
(Seal)
(Form of Transfer) I
.. For value received, the undersigned owner does -hereby
assign and transfer the foregoing Note to the named Assignee, and
the.undersigned City Clerk of the City of Kalispell as bond
registrar hereby certifies that the foregoing Note has been
transferred and registered on the bond register in the name of
such Assignee.
Name of
Assignee
Signature of
Owner
Signature of
-City Clerk
Date of
Transfer on
Bond Register