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. ~ . · RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROPOSED INDUSTRIAL DEVELOPMENT PROJECT BY S-H REALTY UNDER THE MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, AUTHORIZING SUBMISSION OF AN APPLICATION TO THE COMMISSIONER OF SECURITIES FOR APPROVAL THEREOF AND AUTHORIZING THE PREPARATION OF DOCUMENTS AND MATERIALS IN CONNECTION WITH THE PROJECT Resolved by the City Council of the City of New Brighton, Minnesota, as follows: 1. There has been presented to this Council a proposal by S-H Realty, a Minnesota general partnership (the "Company"), that the City undertake a project pursuant to the Minnesota Municipal Industrial Development Act (Minnesota Statutes, Chapter 474), to provide financing for the acquisition, construction and equipping on land in the City of one or more buildings to be used as an office-printing facility of approximately 30,000 square feet (hereinafter called the "Project"), and to be leased from the Company to Scarp-Heilman Co., a Minnesota corporation. The Company will enter into a loan agreement with the City upon such terms and conditions as are necessary to produce income and revenues sufficient to pay, when due, the principal of and interest on up to approximately $900,000 in principal amount of revenue obligations of the City to be issued for the purpose of financing the costs of the Project, all of said obligations to be issued pursuant to Chapter 474, Minnesota Statutes, and the City will pledge its interest in the loan agreement to secure the obligations. The obligations would be issued to institutional investors in a so-called tax exempt mortgage private placement transaction whereby the obligations would be secured by a mortgage on the Project. 2. It is hereby found, determined and declared that the purpose of the Project is and the effect thereof will be to promote the public welfare by the attraction, encouragement and development of economically sound industry, agriculture and commerce so as to prevent, so far as possible, the emergence of blighted and marginal lands and areas of chronic unemployment; the retention and development of industry to use the available resources of the community in order to retain the benefit of its existing investment in educational and public service facilities, by halting the movement of talented, educated personnel of mature age to other areas and thus preserving the economic and human resources needed as a base for providing governmental services and facilities; and the more intensive development of land avail- able in the area to provide a more adequate tax base to finance the cost of governmental services in the City, County and School District where the Project is located. 3. The Project is hereby given preliminary approval by the City subject to approval of the Project by the Commissioner of Securities and subject to final approval by this Council and -2-