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HomeMy WebLinkAbout92-152 - ADMIN Resolution - City Council - 1992/10/051 RESOLUTION NO. 92-152 RESOLUTION AUTHORING THE EXECUTION AND DELIVERY OF AMENDMENTS TO THE INDENTURE OF TRUST AND LOAN AGREEMENT EXECUTED AND DELIVERED IN CONNECTION WITH THE ISSUANCE OF THE CITY OF"ST. LOUIS PARK MULTIFAMILY HOUSING REVENUE BONDS (BRIARWOOD WEST PROJECT), SERIES 1985 BE IT RESOLVED by the City Council (the 'City Council') of the City of St. Louis Park, Minnesota (the "City"), as follows; Section 1. recitals. 1.01. The City is and was at the time of the issuance of the "City of St. Louis Park Multifamily Housing Revenue Bonds (Briarwood West Project) Series, 1985", (the "Bonds"), authorized by Minnesota Statutes, Chapter 462C, as amended (the "Act"), to issue revenue bonds for the purpose of financing the acquisition and preparation of sites for, and construction of, multifamily rental housing development pursuant to the provisions of the Act. 1.02. The City assisted in financing a 186 unit multifamily rental housing development developed and operated by Briarwood West Partnership (with its successor hereinafter described the "Developer") in the City and known as Briarwood West Apartments (the "Project"), by providing funds to finance a loan to the Developer (the "Loan"), the repayment of which is secured by a Trustee Mortgage, Security Agreement, Assignment of Leases and Rents, and Fixture Financing Statement (the "Trustee Mortgage"). 1.03. The Loan was made to the Developer pursuant to that certain Loan Agreement dated as of December 1, 1985, between the City and the Developer (the "Loan Agreement"). 1.04. On or about August 20, 1991, the Loan Agreement was assumed by GHH Investments, a Wyoming general partnership (also referred to as the Developer), as successor to Briarwood West Partnership. 1.05. In order to finance the Loan, the City issued the Bonds under the provisions of that certain Indenture of Trust dated as of December 1, 1985 (the "Indenture") between the City and First Trust National Association, as successor trustee to First Trust Company, Inc. (the "Trustee"), in the aggregate principal amount of Eight Million Dollars ($8,000,000.00) of which $8,000,000 is currently outstanding. 1.06. Midwest Federal Savings and Loan Association of Minneapolis, a federally chartered savings and loan association organized and existing under the laws of the United States of America ("Midwest Federal") issued its irrevocable nonrecourse direct pay letter of credit (the "Initial Credit") to secure payment of the principal of and interest on the Bonds, and to provide funds to enable the Trustee t� purchase the Bonds from the holders thereof under certain circumstances as provided in the Indenture. 1.07. Pursuant to the terms of the Loan Agreement and the Indenture, all of the outstanding principal amount of the Bonds were purchased by the Resolution Trust Corp. as receiver for Midwest Federal (the "Bank"). The Developer has informed the City that no payments of principal of or interest on the Bonds have been made since the purchase of the Bonds by the Bank. 1.08. The Bank has agreed to sell the Bonds to Miller & Schroeder Financial, Inc. ("Miller & Schroeder") as Unsecured Bonds (as defined in the Indenture). 1.09. Miller & Schroeder has represented that upon purchase of the Bonds by Miller & Schroeder, the Initial Credit will have been terminated and discharged, all amounts payable under the Reimbursement Agreement entered into in connection therewith will have been satisfied and the Bank will have released its interest in the Trustee Mortgage, the Bank Mortgage, the Collateral Agreement and the Pledged Collateral (all as defined in the Indenture). 1.10. In order to remarket the Bonds as Unsecured Bonds and to have the Bonds remain outstanding in the future as Unsecured Bonds until such time as the Bonds are refunded, the Developer and Miller & Schroeder have requested that the City authorize the execution and delivery of certain amendments to the Indenture and the Loan Agreement as set forth substantially in the form of the First Amendment to Loan Agreement (the "First Amendment") and the First Supplement to Indenture of Trust (the "First Supplement') attached hereto. 1.11. The First Amendment and the First Supplement require the written consent of the City, the Developer, the Trustee and 100% of the Bondholders of the outstanding Bonds, as the case may be. 1.12. The consent of the Bank is not required in connection with the First Amendment and the First Supplement since at the time of execution and delivery of such documents, no Credit (as defined in the Indenture) will secure the repayment of the Bonds. -2- 2739PHT-3857-373 1l3/5/92 1.13. A public hearing, duly noticed and held on September 8, 1992, on the proposal of the Developer to undertake a refunding of the Bonds by the issuance by the City of one or more series of its multifamily revenue refunding bonds was held to give all parties who appeared at the hearing an opportunity to express their views with respect to the proposal. 1.14. The Developer has informed the City that it now desires to effect the first refunding of the Bonds through the amendment of the Indenture, the Loan Agreement and the Bonds. Section 2. Authorization of First Amendment and First 5unvlement. 2.01. The forms of First Amendment and the First Supplement attached hereto ure hereby approved in substantially the form attached hereto with such variations, insertions and additions as the City Attorney may here after deem appropriate and are hereby authorized to be executed in the name and on behalf of the City by the Mayor and City Manager, with or without the official seal of the City impressed thereon and attested to by the City Clerk. In the absence of the Major, the Acting Major, or in the absence of the Acting Mayor, any member of the City Council, may execute such documents. In the absence of the City Manager, any Acting City Manager or other official authorized to act on behalf of the City Manager may execute such documents. 2.02. The variations, insertions and additions to the forms of the First Amendment and First Supplement approved hereby may include, without limitation, completion of or changes in the mandatory sinking fund, the principal redemption schedule for the Bonds, the amendment of other redemption provisions for the Bonds, changes in the interest rates for the Bonds, the inclusion of the option for the Bondholders to tender all but not less than all of the Bonds to the Developer or its agent for mandatory repurchase, provisions to change the interest rate to a then current market interest rate in connection with the remarketing of the Bonds upon a tender, and such other business terms and conditions as are reasonably necessary to comply with requirements, if any, imposed by Resolution Trust Corp. or requested by Miller & Schroeder in connection with the initial remarketing of the Bonds, provided however, no such amendment change, addition or insertion shall increase the principal amount of the Bonds in excess of the $8 million outstanding, delay the final maturity of any Bond beyond December 1, 2015, increase the interest rate borne by any Bond to a rate greater than 10% per annum or give rise to any pecuniary liability of the City or charge against its general credit or taxing powers or in any fashion obligate the City pecuniarily in any way except with respect to the application of revenues of the Project derived from the Loan Agreement (including the security expressly pledged by or on behalf of the Developer) or in any -3- 2739PHT-3857-379 10/5/92 fashion subject the City to liability for any claim for damages, costs or other pecuniary charge except to the extent that the same can be paid or recovered from the Projects or revenues derived from the Loan Agreement. 2.03. The Mayor, City Manager, City Clerk and other officers of the City are authorized and directed to prepare, execute and furnish certified copies of all proceedings and records of the City relating to the amendments herein authorized and such other affidavits and certificates as may be required to show the facts relating thereto as such facts appear from the books and records of the officers in the officers' custody and control or as otherwise known to them and all such certified copies, certificates and affidavits, including any heretofore furnish, may be executed by one or more of such officers and shall constitute representations of the City as to the truth of all statements contained therein. 2.04. The execution of any instrument by the appropriate officer or officers of the -City herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms thereof. Section 3. Miscellaneous. 3.01. The First Amendment to Loan Agreement and First Supplement shall not be executed and delivered by and on behalf of the City until all written consents, as required by the Indenture and Loan Agreement, are obtained and delivered to the City. The City shall, and shall be entitled to, rely upon the consents delivered to it without independent investigation on the part of the City. 3.02. The City Council hereby finds and determines, based upon representations to the City by the Developer, that at the time of the original issuance of the Bonds, the final maturity of the Bonds did not exceed the reasonable life expectancy of the Project and as of the date of this Resolution, the final maturity of the Bonds established pursuant to the First Supplement will not exceed the reasonable life expectancy of the Project. 3.03. This Resolution shall be effective immediately upon its final adoption. -4- 2789PHT-8857-878 1 x5/92 PASSED by the City Council of the City of St. Louis Park, Minnesota this 5th day of October, 1992. ATTES Beverly A. Flanag City Clerk Reviewed for administration: Lyl4 W. Hanks, Mayor c.) Approved as to form and execution: W. C. Dixon, City Manager Suesan Pace -Shapiro, City Attorney The motion for adoption of the foregoing Resolution was made by Member Meland and was duly seconded by Member Jacobs and the following voted in favor thereof: Jeff Jacobs George Haun Allen Friedman Keith Meland Larry Mitchell Gail Dorfman Lyle Hanks and the following voted against the same: No one whereupon said Resolution was declared passed and adopted and was presented to the Mayor who approved and signed the same which was attested by the City Clerk. -5- 2739PHT-8887-979 1 G5/92