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HomeMy WebLinkAbout91- 148 - ADMIN Resolution - City Council - 1991/08/05RESOLUTION NO. 91- 148 RESOLUTION RELATING TO THE ACCEPTANCE BY THE CITY OF A THIRD AMENDMENT TO LOAN AGREEMENT TO THE CITY'S HOSPITAL FACILITIES REVENUE BONDS (METHODIST HOSPITAL PROJECT) SERIES 1985-A AND SERIES 1985-B AND A FIRST SUPPLEMENTAL LOAN AGREEMENT TO THE CITY'S HOSPITAL FACILITIES REVENUE BONDS (METHODIST HOSPITAL PROJECT) SERIES 1990-A, SERIES 1990-B AND SERIES 1990-C. WHEREAS, the City of St. Louis Park, Minnesota (the "City") has previously entered into an Indenture of Trust dated as of October 1, 1985 by and between the City and Norwest Bank Minneapolis, National Association, as Trustee, relating to the issuance by the City of its $31,000,000 Hospital Facilities Revenue Bonds (Methodist Hospital Project), Series 1985-A and $10,465,000 Hospital Facilities Refunding Revenue Bonds (Methodist Hospital Project), Series 1985-B (together with the Series 1985-A Bonds, the "1985 Bonds") and Indenture of. Trust dated as of October 16, 1990, relating to the issuance by the City of its $27,070,000 Hospital Facilities Refunding Revenue Bonds (Methodist Hospital Project), Series 1990-A, $7,760,000 Hospital Facilities Refunding Revenue Bonds (Methodist Hospital Project), Series 1990-B and $66,170,000 Hospital Facilities Revenue Bonds (Methodist Hospital Project), Series 1990-C (together with Series 1990-A and Series 1990-B Bonds, the "Series 1990 Bonds") which Series 1985 Bonds and Series 1990 Bonds were issued on behalf of Methodist Hospital (the "Corporation"); and WHEREAS, the City has entered into a Loan Agreement, dated as of October 1, 1985, as amended by a First Amendment to Loan Agreement dated as of April 10, 1989, and a Second Amendment to Loan Agreement dated as of September 1, 1989, each amendment entered into by and between the City and the Corporation (the original Loan Agreement, as so amended, the "Series 1985 Loan Agreement"), pursuant to which the City has loaned to the Corporation the proceeds of the Series 1985 Bonds for the purpose of financing certain improvements to the Corporation's existing hospital facilities and refunding certain outstanding bonds previously issued by the City; and WHEREAS, the City has entered into a Loan Agreement, dated as of October 16, 1990, by and between the City and the Corporation (the "Series 1990 Loan Agreement") pursuant to which the City has loaned the proceeds of the Series 1990 Bonds to the Corporation for the purposes of financing certain improvements to the Corporation's existing hospital facilities and refunding certain outstanding bonds previously issued by the City; and -1- 1e :TAH•O38 1450 o7/26141 WHEREAS, pursuant to Section 7.7(c) of each of the Series 1985 Loan Agreement and the Series 1990 Loan Agreement, the Corporation is required to maintain comprehensive professional liability insurance, including medical liability, malpractice and othersas recitedyinsurance in amount in each of said Loan Agreements; and WHEREAS, the Corporation has proposed a third amendment to the Series 1985 'Loan Agreement and a first amendment to the Series 1990 Loan Agreement (the "Proposed Amendments"); and WHEREAS, the Proposed Amendments would revise Section 7.7(c) of each Loan Agreement to read as follows: "Comprehensive liability insurance, including medical liability, malpractice and other hospital operation professional liability insurance (other than as set forth in subsection (b) of this Section 7.7) in an amount not less than $1,000,000 for all bodily injuries and deaths resulting from any one claim with an annual aggregate limit not less than $3,000,000 (the "primary malpractice coverage requirement") and umbrella coverage of at least $10,000,000, provided that the Corporation may elect to retain all or any part of the first $1,000,000 of risk beyond the primary malpractice coverage requirement and to obtain umbrella coverage for the next $9,000,000 or more of comprehensive professional liability risk"; and WHEREAS, pursuant to Section 11.01 of each of the Indentures of Trust relating to the Series 1985 Bonds and the Series 1990 Bonds, the Corporation is required to receive the consent from AMBAC Indemnity Corporation (the "Bond Insurer") and Norwest Bank Minnesota, National Association (the "Trustee") Sany a1meproposed the Series iLoan Agreement and See ries990Loan Agreement not requirngthe consent of bondholders; and WHEREAS, the Corporation has received such consent from the Bond Insurer and the Trustee for the Proposed Amendments to Section 7.7(c) (of each of the Series 1985 Loan Agreement and the Series 1990 Loan Agreement); and WHEREAS, pursuant to Section 7.6 (of each of the Series 1985 Loan Agreement and the Series 1990 Loan Agreement), the Corporation will' pay, protect, indemnify and save the City, the City Council, the City's officials and employees and the Trustee harmless from and against all liabilities, losses, damages, costs and expenses (including attorneys' fees and expenses), causes of action, suits, claims, demands and judgments of any nature arising from any violation by the Corporation of any agreement, warranty, covenant or condition of the Loan Agreement; and -2- 1890TAM-038137-350 07/26/01 WHEREAS, pursuant to Article 11 of each of the Indentures relating to the Series 1985 Bonds and the Series 1990 Bonds, the City is not required to consent to any amendment requested by the Hospital pursuant to Section 11.01 of each such Indenture and may rely upon the consent of the Trustee and the Bond Insurer to any such amendment under each Indenture; in authorising the execution and delivery of the amendments, the City is not passing on or expressing a view as to the substance of the amendments. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of St. Louis Park: 1. That the Mayor and City Manager will execute and deliver the Third Amendment to Loan Agreement in relation to the Series 1985 Bonds substantially in the form set forth as Exhibit A, and the First Supplemental Loan Agreement relating to the Series 1990 Bonds substantially in the form set forth as Exhibit B being attached hereto. 2. That this resolution shall become effective immediately upon its passage and without publication. Adopted this 5th day of August, 1991. w Mayor AT ST: 41 City C rk REVIEWED FOR ADMINISTRATION: City Manager APPROVED AS TO FORM" AND EXECUTION: '711.4-1.Slr ei-Tom- City Attorney 189:TAH -3- 097TA H-03857-350 07/28/0 1